Tuesday, January 6, 2009

Greed and Sloth

It was 1995. I was fresh out of college and I was living in New York. Because the economy was almost as bad as it is now, I couldn't find a real job. Plus, I really didn't like working. So, I got a gig bartending at a Mexican joint in Hell's Kitchen. It was called El Azteca, which I think is roughly translated to The Aztec.

People liked me there because I didn't know how to bartend and subsequently, I made ridiculously strong margaritas. Once word of my ineptitude got out to the alcoholics in the neighborhood, I had a steady stream of regulars. One of those regulars was a guy named Dan.

Dan was about 40. He said he had a hot girlfriend (despite the fact that I never saw her at the bar). He said he was really rich (despite the fact that he spent his days at a shitty bar in Hell's Kitchen). He said he was best friends with disgraced football star Mercury Morris (I didn't know who Mercury Morris was, but Dan said he was pretty cool). Dan tipped me well and he seemed to be an alright guy.

One day, he made me an offer. No, it wasn't a proposition for gay sex. It was, as Dan said, the opportunity of a lifetime. He said that he laundered money for the mafia and, because I seemed like I could be trusted, I could get involved and make some serious greenbacks (yes, he said greenbacks). All I had to do was give him my money, let him launder with it for a week and then he would return with double the money. After pondering the prospect for a while, I figured what the hell and I gave him my tips for the night. Sure enough, a week later, he returned with double my tips.

I was stoked. How lucky was I to meet up with this guy that could make me rich without having to do a thing? I figured this would be my job. I'd be a money launderer. I could do this for a year or so and I'd retire to the beach at 24 without ever having to get a real job. So, when my parent's rent check arrived (yes, my parents were still paying my rent), I cashed it and gave the proceeds to Dan. If all went according to plan, I'd have double my money back just in time to to pay my landlord and then I'd reinvest the rest.

A week later, I anxiously waited for Dan to arrive with my cash. He didn't. I called him and he told me he'd meet me somewhere. He didn't show. Then, he apologized and told me to meet him somewhere else. He didn't show again. This cat and mouse game continued for a a while. Eventually, Dan disappeared. So did my money. I never did meet Mercury Morris either.

I got conned. Sure it was only $1000, but when you're 23 in Manhattan and you all you can afford are generic cigarettes and Ramen noodles, it hurts. AND, I had to listen to my dad call me an idiot when he cut me another check so I wouldn't get evicted.

In retrospect, I don't blame Dan. I blame myself. I wanted money, but I didn't want to work for it. My judgment was blurred and I trusted a person and a concept that shouldn't have been trusted. I fell victim to my own greed and sloth. It sort of reminds me of the current state of our economy...

Over the past decade or so, a lot of things occurred that made it easy to make money without having to do much. The mortgage industry was deregulated, while real estate prices went through the roof. If you had half a brain, you could buy a house, then flip it and make a tidy profit. Or, you could get a job in brokerage or construction or anything else necessary to support the real estate boom.

Meanwhile, consumer confidence reached record highs and the stock market saw record gains. Credit card companies gave away credit with reckless abandon and hedge funds invested with reckless abandon. Yes, it was a time of endless opportunities. The problem was that most of the people that took advantage of these opportunities were not hard workers. They were lazy, but they wanted to be rich, or at least live like it.

When I was growing up, there was a very clear differentiation between the classes. If you worked hard (or you were born right, married right, or got lucky), you were rich. Everybody else was either middle class or poor. The rich people had nice cars, nice houses, designer clothes, and vacation homes. Everybody else didn't. Over the past decade or so, that changed. The rich, the middle class, and the poor, had the same things. The class lines had blurred.

College kids were driving Audis and BMWs. White trash resided in million dollar homes with state of the art home theaters. Bottle service was the de facto way to drink and high priced clubs in Vegas were the only place to drink. Every dude had a Panerai on his wrist and every chick had a diamond tennis bracelet on her wrist. Everybody summered in Ibiza or The Hamptons and everybody stayed at boutique hotels or in beach front vacation homes. It was like communism except everybody had money. Unfortunately, none of it was real. It was the result of undeserved wealth resulting from unbridled greed and sloth.

We all remember when the shit hit the fan. People stopped being able to pay their mortgages, which led to the fall of our financial institutions, which led to the tightening of credit, which led to the inability of consumers to spend, which led to record unemployment, which which led to the drop in the stock market, which led to trillions of dollars of lost wealth (it's a rough summation, I'm not an economist). Essentially, everybody got conned. None of the prosperity of the past decade or so was real, but we wanted to wanted to believe it was. Now, we're going to have to collectively listen to our dads call us idiots while they cut us new rent checks.

So what's going to happen? Well, the American economy is going to reset. No longer will everybody be rich. As more and more Madoff-esque hedge funds are exposed to be frauds that relied on America's false prosperity, even the rich won't be rich. Then, everybody will have to start over. The people who work hard are going to rise to the top. Those who are lazy will sink to the bottom. We'll all settle in to our respective places in society.

Our country is a meritocracy. If you want things, you gotta work for them. There's no free lunch (except from the Hare Krishnas, but then you have to talk to those freaks). If you want to sling margaritas at a bar in Hell's Kitchen, that's fine. Just don't expect to have an apartment that's featured on Cribs or a car that costs more than a house. Greed and sloth are a bad combination. If you want to have money, you gotta get off your fucking ass!

Maybe I'm wrong. Maybe there will be another bubble or another ponzi scheme or another wave of unreal prosperity that will allow us to slide back into our riches. Who knows what the new year will bring? Still, if I were a betting man (which I am), I would bet that the easiest way to get rich in "The New New New Economy" will be to get a good job, work hard at it, and save as much money as you possibly can. Or, you could wait for a guy named Dan to give you the opportunity to launder money for the mob.

6 comments:

Al Lewis said...

Actually, the easiest way to get rich is to become a bankruptcy lawyer. Nice work, Iron Mike.

Dianna Williams said...

There's some truth in that, and the fact is they earn roughly around $100 and $300.
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Madeth said...

I'm glad you learned your lesson well. I'm sure you will be careful in making financial decisions the next time.

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michaeloco said...

Great read. Sometimes, you do not need to hire a financial advisor in Perth before you realize and decide things on your own. It is up to you how you would face challenges and learn the lesson afterwards.

BRIAN SMITH said...
This comment has been removed by the author.
BRIAN SMITH said...

It is hard to pinpoint your financial independence in life we have to fail at things in order to learn from them.

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