55 Billion Pennies

IT turns out that, in creating ``master of the universe'' Sherman McCoy in his novel ``The Bonfire of the Vanities,'' satirist Tom Wolfe suffered from a pinched imagination. As a symbol for Wall Street in the '80s, bond-trader McCoy was supposed to be larger than life. But alongside Michael Milken, Sherman's a 5-and-dime guy. Mr. Milken is the financial wizard who almost single-handedly invented the $188 billion market for high-yield ``junk bonds.'' But his wizardry may have included some illegal legerdemain; he is under indictment on a variety of market-manipulation charges.

The numbers that keep surfacing in the Milken story elude understanding through all the normal criteria - sort of like the number of miles in a light-year. In 1987 alone Milken made $550 million. Now we read that Milken's lawyers have been negotiating to get his bail bond reduced from $1 billion to a mere $600 million. For him, it probably makes the difference between being able just to write a check and having to sell a few assets.

(Just kidding. Actually, he will put assets worth the agreed-on sum into an account that can be monitored by the government during its prosecution.)

Maybe Milken is innocent of all wrongdoing. Maybe he earned every penny - all 55 billion pennies, that is - he banked in 1987. Markets can reward seemingly marginal skills, like hitting a baseball or screaming rock lyrics into a microphone, in eye-rubbing ways: That doesn't make markets bad, say what populists will.

All in all, it's well that the frenzied, grasping '80s produced a Mike Milken. Genius or crook, he brings complex issues into focus in a way no other person has done. His exaggerated - if you will, leveraged - circumstances have become a fable for our time. For years into the future, moralists will look at Milken's career and ask, What does that say about our system?

About these ads
Sponsored Content by LockerDome

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

Save for later

Save
Cancel

Saved ( of items)

This item has been saved to read later from any device.
Access saved items through your user name at the top of the page.

View Saved Items

OK

Failed to save

You reached the limit of 20 saved items.
Please visit following link to manage you saved items.

View Saved Items

OK

Failed to save

You have already saved this item.

View Saved Items

OK