Wretchedness and Excess

Santa Claus is coming . . . to Wall Street. Goldman Sachs' employees are getting bonuses that average over $600,000 a head and run up to $100 million for some of the top guys, though it's a safe bet the cleaning crew won't be seeing any of this largesse. Holiday parties are another measure of the frenzy in the financial and tech industries, reaching levels of excess not seen since the dot-com era: Hand-rolled cigars, $500 a shot champagne and caviar servings, "signature cocktails" like pomegranate martinis, custom disco lighting, and bevies of near-naked elves.

The New York Times (12/10/06) reports that "for a hedge fund firm, L'Olivier is creating an Aspen chalet-themed gala at the Morgan Library, with Ralph Lauren-style decor and fake animal heads for mounting on the wall, at a cost of about $100,000 (and that's before the food and drinks)."

Maybe they're just bitter because they haven't been invited to any of the right parties, but the folks at ABC News couldn't resist offering helpful tips on how to spend a $100 million bonus: "You could provide immunizations for more than 40,000 impoverished children for a year ($37.5 million), then throw a birthday party for your daughter and one million of her closest friends ($60 million). You'd still have enough to buy a different color Rolls Royce for each day of the week ($2.5 million)." (ABC News)

What bothers me about the wretched excess in the financial industry is not just the missed opportunity for immunizations, but the fact that, for most of us, Christmas is a portal to serious debt. More serious, I should say, since 115 million Americans already carry credit card debts from month to month, with an average balance of $9000. Throw in the seasonal obligation to toss money around for Play Stations, fruit baskets, cashmere twin sets, Talking Elmos, and the like - and you're looking at a long, cold, 2007.

It doesn't help that the average minimum monthly credit card payment has doubled within the past year. Fall behind, and you face a late fee of about $30, plus the possibility of seeing your interest rate soar to 30 or 40 percent. Fall really far behind and they'll come after your house, your car, and your children. You get to keep your credit card though, because the financial industry loves nothing so much as a debt slave.

But there's a bright side to even the most crippling debt: It can be sold. Not by you, of course, unless there's something I haven't noticed on e-Bay. Your credit card company can sell your debt to some other company that will happily engage in water-boarding or whatever it takes to collect it. In other words, and I will admit that my understanding of these financial shenanigans is sketchy, your debt magically turns into someone else's asset. Think of it this way: your misery over the January heating bill helped finance a pomegranate martini, served up by a scantily clad elf.