Wall Street – The History

8 11 2008


The young urban professionals have arrived…
they’re making lots of money,
spending it conspicuously,
and switching political candidates like they test cuisines.”
–Newsweek Magazine1


The baby boom generation had grown up by the 1980s. They were the rising dominant political and cultural force in America: increasingly college-educated, upwardly-mobile and looking to find greater success than that of their parents. Every one out of three Americans had been born between 1946 and 1964, and the median age in 1983 was 30.9. Single-person households were on the rise, more people than ever were not getting married, and metro areas were growing faster than suburbs, a turnaround from the previous decade.2 Cold War tensions and the United States deficit under Reagan were on the rise.

Both the average household income and the rate of home-ownership dropped during the early 1980s. Who was benefiting during this time? Estimated to be only about 6% of all baby boomers, the “BMW-driving, Reebok-clad, madly acquisitive” yuppies were making ten to twenty times the 1981 average American income.3 The term “yuppie” came from the phrase Young Urban Professional, and echoed both “hippie” and “preppy.” The yuppies rejected the social revolution ideals of the hippies, while envying the preppy sentiment of entitlement.4 The major difference was that anyone with money could become a yuppie.

“It is as if the Woodstock mentality had somehow merged with the Bloomingdale mentality.”
–Landon Y. Jones5
Personal empowerment and the quest for financial independence trumped emotional connections like family and marriage. The worth and identity of a person did not come from their heritage, but from personal accomplishments. While their parents had started their lives by marrying young and having their own families, the yuppies spent their 20s and 30s pursuing their careers. This delay in passing the traditional signposts of adulthood meant that the yuppies lived their 20s as children, spending their money on gourmet food, travel, health clubs, and remodeled homes. Yuppies were three times as likely to carry an American Express card and travel overseas.6
Women did not begin entering Wall Street as professionals until the 1970s. The increased focus on career and the more liberal sexual ideals of the 1980s drastically altered the way in which men and women related to each other. Women had to choose between using their sexuality to get ahead in a male-dominated workplace, or risk becoming unsexed in their attempts to integrate. A 2004 study on Sex-Segregation on Wall Street showed that professional women in the field were less likely to be married, less likely to be parents, and on average earned 60% less than their male counterparts.7
“Babies become the signifiers of emotional life, in representation, now that women are no longer available for that task.” –Judith Williamson8

On the legal side, prosecutions for insider trading rose between 1982 and 1987. It is unclear whether this was due to an actual increase in insider training or simply an increase in prosecutions, since U.S. Securities and Exchange Commission (SEC) chairman John Shad shifted the focus in the early 1980s back onto prosecuting securities law violations. Hostile takeovers also trended upwards during the 1980s from 47 a year in 1981 to 85 a year in 1987.9 One possibility for this rise was the country’s eventual recovery of stagflation and depressed stock prices.

The Yuppies first burst onto the scene in 1984, but rode the wave of prosperity in the incarnation looked at in this presentation only until around 1987.

“The Yuppie lifestyle features rampant consumerism, distrust of the parent generation, fear of the suburbs, unstable intimate relationships, reliance on the peer network, confrontation of the lingering sixties consciousness, difficulty of growing up to accept adult responsibilities, the problems of parenthood,
and the desire to have it all.”
–Carol M. Ward10

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MySpace Codes

1 “The Year of the Yuppie,” Newsweek in The Seventies: The Great Shift in American Culture, Society, and Politics (Simon & Schuster, 2001), 241.
2 Richard Stengel, “Snapshot of A Changing America.” Time Magazine (1985): Time.
3 Ibid.
4 Schulman, 241.
5 Landon Y. Jones, Great Expectations: America and the Baby Boom Generation (New York: Ballantine Books, 1981), 317.
6 Schulman, 243.
7 Louise Marie Roth, “Engendering Inequality: Processes of Sex-Segregation on Wall Street,” Sociological Forum 19.2 (June 2004): 209.
8 Judith Williamson, “Having Your Baby and Eating It”, New Statesman 15 (April 1988), 45.
9 Martin S. Fridson in Robert B. Toplin, editor, Oliver Stone’s USA (Lawrence: University of Kansas Press, 2000), 130-131.
10 Paul Loukides and Linda K. Fuller, Beyond the Stars (Bowling Green: Bowling Green University Press, 1990), 106.

Wall Street sign found at Whitman School of Management, “Whitman Today,” http://whitman.syr.edu/HTMLEmail/Dean/whitmantoday/Images/Wall-Street-sign.jpg (accessed November 6th, 2008).



The Seventies: The Great Shift in American Culture, Society, and Politics

1 11 2008

Schulman, Bruce J. “The Seventies: The Great Shift in American Culture, Society, and Politics.” Simon & Schuster, 2001.

“The young urban professionals have arrived… they’re making lots of money, spending it conspicuously, and switching political candidates like they test cuisines.” (Newsweek, 1984 in The Seventies)

The term yuppie is an alternative and rejection of hippies, while echoing the term preppies – a sense of entitlement,  but significantly not dependent on birth, family, status. Anyone with the money could become a yuppie. Yuppies were three times as likely to carry an American Express card, travel overseas, and work out in the health clubs, according to Newsweek. Their loyalties lied in their networks, not with their families, corporations, or country.

The Wall Street Journal even referred to Reagan as the nation’s most aged yuppie.

The path was to personal empowerment! The way to do that was to pay for it.

“The Year of the Yuppie,” Newsweek, December 31, 1984, p. 14-31.



Yuppies

13 10 2008

Hammond, John L. “Yuppies.” The Public Opinion Quarterly, Vol 50, No 4 (Winter 1986), p. 487-501.

Newsweek proclaimed 1984 the year of the Yuppie, since they were the rising dominant political and cultural force in American society. While conservative on economics (taxes, government regulation, and the New Deal agenda), they are socially liberal; they encourage less restrictions on sexuality, equal rights for women, freedom of sexual preference and abortion.

Trust in government declined, and personal fulfillment has become the dominant theme of culture = Self-help movements and psychotherapy!

“… it is as if the Woodstock mentality had somehow merged with the Bloomingdale mentality.” (Jones, Landon Y. Great Expectations: America and the Baby Boom Generation. New York: Ballantine Books (1981), 317.)

“Yuppies came of age in imposing numbers. They visibly transformed the American cityscape with health clubs, gourmet delis and remodeled houses. In the process they became a marketing target, and since newspapers, magazines, and television are marketed, journalists had to pay attention to them.” (Hammond, 497)

“The arrival of the yuppies qualified as an event; it could be dramatized and visualized.” (Hammond, 498)



Oliver Stone Interviews

28 09 2008

Silet, Charles L. P., editor. Oliver Stone Interviews. University Press of Mississippi, 2001.

“My father believed that America’s business brought peace to the world and built industry through science and research, and that capital is needed for that. But this idea seems to have been perverted to a large degree. I don’t think my father would recognize America today.” (64)

“The Pax Americana, to me, is the dollar sign. It works. It maynot be attractive. It’s not pretty to see American businessmen running all around the world in plaid trousers, drinking whisky. But what they’re doing makes sense.” (65)



Oliver Stone’s USA

28 09 2008

Martin S. Fridson

Reviewers said that “Wall Street” lacked emotional depth and that it was inaccessible to audiences because of its fidelity to the details of the security industries and jargon. “Wall Street” came on 2 months after October 19, 1987 (Black Monday, which shattered all previous records for Dow Jones one-day declines).

“The average stockbroker’s life is indeed much duller than Bud Fox’s, but it would be naive to suppose that a faithful depication of the mundance reality could have obtained commercial backing.” (Fridson, 120)

“[The characters] have no subtlety. They practically wear placards – ‘good,’ ‘bad,’ ‘corruptive,’ ‘redeemed’ – tacked to their $2000 suits.” (Hal Lipper of the St. Petersburg Times, “Wall Street: Paper-Thin”, December 11, 1987)

Critics overall saw the film as too black and white in its portrayal of good and bad people, simple-minded, melodramatic, too obvious, two-dimensional, soap opera-like, and thrilling but disposable. Stone did win praise for his cinematography for the enjoyment of the film. Michael Douglas was mostly lauded for his portrayal, but the rest of them (Charlie Sheen and Daryl Hannah) were panned for lacking emotional depth. Some blamed it on the script, asking if any actors could have made the roles palatable.

“Wall Street” was outgrossed by both “Throw Momma From the Train” and “Three Men and a Baby” in its opening weekend. It did well in Manhattan and other big cities, but it did poorly in city suburbs. Fox Studies tried to play up the romantic angle in its second wave of advertising, rather than the financial angle. (Fridson, 124)

Stone actually filmed at the NYSE uring trading hours, used the correct brand of computers for the trading floor (AT&T), and used the correct proportion of women to case for a business meeting (35%). (Fridson, 124) Douglas, Stone, and his staff met with Wall Street executives, takeover artists, and junk bond chiefs. Stone invited investment banker Kenneth Lipper to become chief technical adviser on the film, and he first denied, until Stone granted him the ability to read the script and write a critique. Lipper insisted that Stone keep some of the brokers honest.

Takeover lawyer Arthur Fleischer, Jr. called the film “a ludicrous portrayal and completely unbalanced.” (Geraldine Fabrikant, “Wall Street Reviews ‘Wall Street,'” New York Times, December 10, 1987, D1)

Prosecutions for inside trading soared to 25 cases a year between 1982 and 1987 under SEC chairman John Shad. Whether this increase was just in prosecution, or if the increase in prosecution was due to an increase in insider trading also is debatable. In the early 1980s under Shad, the focus of the SEC shifted from the 1970s focus of protecting investors to the 1980s focus on the prosecution of classic securities law violations (128). “There is no need to posit, as Wall Street does, that greed was the novel element.” (Fridson, 130)

The film accurately portrayed the rise of hostile takeovers in the US, as they trended upwards from 1981 (47 a year) to 1987 (85 a year) (Fridson, 131). This cannot be attributed just to greed or get-rich-quick thinking, as the film implies, but one possibillity is that it was a result of depressed stock prices, as the country recovered from stagflation.