Wall Street, 2009: Deaf, blind, and just plain dumb

In Gone with the Wind, Rhett Butler wryly notes that there is "just as much money to be made out of the wreckage of a civilization as from the upbuilding of one." Having observed the near-Roman excesses of New York's money men over the past couple of years, I might go even further and argue that the end of a civilization tends to be even more outrageously profligate than its beginning. After all, it's hard to imagine stern, conservative men like J.P. Morgan and Andrew Mellon giving in to the incredible excesses of the latest round of would-be magnates.

While tales like Stephen Schwarzman's million dollar birthday and Dick Fuld's five homes tend to capture the public's attention, these outrageous expenditures are only the tip of the iceberg. From $175 hamburgers at the Wall Street Burger Shoppe to John Thain's $1.22 million office redecoration, it has become increasingly clear that New York's financial workers have spent the last few years living in a completely alien world. What's more, they are either unable or unwilling to adapt to the changing realities of America's economy.

The thing is, the economy has fundamentally changed. The imploding real estate market and booming financial services sector, boosted by variable rate mortgages, overleveraged assets and dodgy CDOs is over, a relic of the early twenty first century. It is a part of history, much like Holland's tulip boom or England's empire. What we are left with is a massive amount of debt that needs to be dealt with, a housing market that dropped over 18% in November 2007, and a populace that is beginning to think that the best place to put its money is under the mattress.