Tag Archives: Futures

My first Wall Street year-end was 1990, 21 years ago. I was a grunt on the Kidder Peabody High Yield (Junk Bond) trading desk. I worked for the iconic Tom (The Human Piranha) Bernard. I was 22 years old. My base salary was $18,000. I had been on the trading floor less than 6 months. My bonus was zero. Nothing, but a few pearls of wisdom from my fearless leader. After sensing my frustration during my year-end review, Tom closed my file and sat back in his chair. He was younger than I am today, 39 maybe 40 at most, but wise beyond his years. He told me a story. He told me that there was once this Father Bull and Son Bull taking a stroll on the top of a mountain overlooking a canyon filled with grazing cows. For those who don’t know this as Bernard found it necessary to explain to me, “Cows” are Female Bulls. Male Bulls are just “Bulls”. As the story goes, the Son Bull got very excited when he saw the canyon filled with these luscious cows. He turned to the Papa Bull and said “Dad, Dad…lets run down there, nosing in the direction of the

eutherian harem, grab one of those cows and have sex with her.” “Let’s go, lets go, come on Papa.” Bernard paused for a moment; letting the young bull’s words sink in.  The Papa bull slowly turned to his son and looked him straight in the eye, “Patience my son, patience”…..”Why don’t we walk down this mountain and f*** them all”. Then silence. Bernard looked me straight in the eyes as he leaned forward over his desk. “Do you understand the f***ing story?” he asked. “Yes” I said, dead seriously, “I understand the f***ing story”. He was quite brilliant. Silence followed for a moment. I got up, shook his hand, ready to return to the trading floor and get my head back in the game. “Hey”, he called to me as I began to open the door to his glass office dubbed the “fish bowl”, at the far end of the trading floor. “Keep working hard and stay focused, maybe you wont be disappointed next year.”

He was right, too right.  Bonuses on Wall Street are a conundrum wrapped in an enigma. The next year I got a nice bonus.  And yes I wasn’t “disappointed”, but I wasn’t ecstatic either. Bonuses are meant to achieve a balance in your mind, often referred to as “satisfaction”. Satisfaction that you make more money than you ever thought you would but not as much as you now want. Satisfaction that the number you received was somewhere between the low end of your expectations and the high end, and you wont have to start looking for another job. Bonuses are also meant to give you a taste but not the full treat. They are meant to get you hooked. They are like a drug that gets you high but leaves you wanting more, needing more. Six months after you get your bonus, you are meant to have somehow elevated your life style, and increased your expenses such, that as you count down the next six months you work your ass off praying and hoping for a bigger bonus than the previous year, only to repeat the entire emotional process again and again.

There were year-ends of famine and year-ends of feast over the last 21 years. Such is the nature of a career on Wall Street, finance or trading. Even if your career is not structured around a year-end bonus, the last week of December is still a period of annual “career self reflection”. “What was my total take for the year?”, “How much better or worse did I do year over year?”, and “How am I going to make more money next year?”. During your early days, you try to gauge what you think you are getting by consensus. While it is taboo on wall street to discuss your actual bonus with anyone other than your manager, it is vey common to discuss bonuses as a concept with just about everyone under the sun, or at least on the trading floor. “What are you hearing? Up or down year over year.” “I heard there hitting the new guys first but they cant do anything about all the guarantee, so we are getting screwed”. Some of my favorites were, “look, we had a good year, but we have to make up for some of the groups that didn’t, we are a team”. I am not sure I knew which group we were making up for, let alone anyone’s name.  My other favorite was, “look, expect the worst and no matter what you will be happy.” What the f*** did that mean? Jesus, it was like water torture in the month leading up to bonus. Should I expect cancer my whole life and when I die of heart attack, be happy?” In the final week certain people would get told their bonuses before other, and then the rumors would start. “Did u hear that so and so trading desk was paid down 20%?” Or “I heard so and so desk really got fucked, they are all

downstairs drinking and putting together resumes”. Occasionally you would actually have a random trader crack, and see him kicking in stall doors in the men’s room. The worst though is when you saw someone who you knew was just told their comp and he was F’n smiling. You felt like ripping out his gullet. You see, traders were told there was a finite pool for bonuses, and any body smiling before you had gotten comped could only have taken money out of your pocket.  The whole process was structured such that when the moment finally arrived when you were to be told your bonus, your expectations had been lowered so severely, that the best you are hoping for is not to have to hit the men’s room in the middle of your review, because your stomach gives out. As you get older you are plagued by other questions. “Are my best years behind me?”, “What did I do to screw things up?” , “Why cant I be the guy who makes 1 million?” or “Why cant I be the guy who makes 10 million.” This whole process that begins as early as November is commonly referred to on Wall Street as, bonus messaging. It is both a science and art that has been practiced by management for centuries.

This year is different for me in a number of ways. It is the first year in a long time that I have not worked for an institutional firm and I am not getting a bonus. It is the first year in a long time that I am not being reviewed by a manager. But it is actually one of the most difficult bonus seasons I have faced in quite a long time. I am on my own. I will live or die by my own sword. There is no bonus for me this year, and there may not be any for many years to come. I continue to plow money into the business I started a year ago. I am investing in the journey, and there is no promise of a bonus or reward at the end…..Yes, I no longer will measure myself by “year end”. I have finally broken myself of “Bonus fever.” I will not suffer the year end “self worth affliction.” After 21 years of the December “money malady”, I see December no different than January or February. Each day I keep my business running and stay alive to fight another day is my bonus. The journey itself has become my reward, and I am looking inward for self worth. Management no longer will judge me, but I will weigh in on my own value. My “Self” will review my “Ego” and while the “Ego” may never be satisfied as I am sure it never has been in previous years. My “Self” will be much better off and has learned to have no expectations. That is my bonus.

Yes, year-end and the holiday season are about peace on earth and all that other stuff. But unfortunately for those particular demented species known as Wall- Streeters, bankers and traders, it is about money and self worth and then maybe peace on earth. So during this time of holiday cheer, try to remember the Papa Bull’s lesson.

My personal Bonus season message, is ignore the “Ego”, focus on the “Self” and try to enjoy the Journey…..Oh yeah, Peace on Earth too.