Ah, the zeroes! While it’s admittedly a little early to look back on the first decade of the 21st century – it only ended a couple of months ago – it merits some reflection given all the stuff that happened, particularly on Wall Street. Which is where Randall Lane’s The Zeroes comes in – it’s a “tell all” book about the Masters of the Universe and how their shenanigans and excesses brought us all to the brink of Great Depression II.
Lane is an interesting commentator because he’s a serial magazine/media entrepreneur who sought to profit off the decade’s trends by targeting the newly uber-rich traders, hedge fund managers and dealmakers. Not a member of the cliquey world he targeted, his success in holding up a mirror to the outsize egos he covered gained him entrée.
And what a world it was. I won’t spoil the book by giving much away, but if you don’t end up laughing, shaking your head and being shocked I’ll be very surprised. A minor but very funny, IMHO, snippet: a crowd of young male traders leaving a high-stakes charity poker game in Vegas where Lane had cleaned up, so engrossed in debriefing him on how he did it that they are completely oblivious to the horde of scantily-clad beautiful women they are passing through, desperately trying to get their attention.
Along the way Lane points out some of the amazing fallacies which made this an even worse Gilded Age than the original Gilded Age. Compensation schemes that simply rewarded taking risk, not earning money for clients (“I might as well bet big, because my original bets crapped out, and it’s not my money anyway”). Laissez-faire economics run amok, turning what most of this think of as a means of keeping society functioning – the financial system – into a high stakes gambling hall. Wealthy investors, exempt from most of the regulatory apparatus that girds the financial system by virtue of their supposedly superior knowledge of its workings, throwing money at people with no track record, or, odder yet, records of failure. “Wizards of Wall Street” who could’ve learned a thing or two from my mom, whose simple “if it seems too good to be true, it probably is” perspective might have avoided or minimized the problems that lead to the collapse of the global financial system in 2008.
I cannot imagine anyone reading this book and not concluding that the inmates – clever, clearly intelligent in some ways but equally clearly monumentally incompetent in many other ways – had taken over the asylum. And at least briefly thinking we need to grow beards (those of us who are guys, anyway), buy some camouflage uniforms, learn to smoke cigars and take matters into our own hands :).
Sadly, I think we’ve missed the chance to hold the people who collectively nearly wrecked us all accountable, and fix some core problems with our current financial regulatory system. There need to be, and should have been, far more perp walks of the people described in Lane’s book. Instead, they’re still out there, still scheming, and will likely once again come back to trouble the rest of us.