The Buy Side (8 page)

The penultimate arrival is Gary. Raj, the boss, is of course last. But his entrance, despite his hulking frame and swarthy skin, pales
in comparison with Gary’s. Raj is as sunny as a beauty queen in a homecoming float—rose petals seem to cover his path. When Gary walks in, apprehension fills the office. He’s dressed in a Greenwich Country Club golf shirt and jeans. The first thing he does is turn down the thermostat. He likes the temperature a few degrees below comfortable. You never know what you’re going to get from him. On this day, he says good morning to Keryn and asks why she didn’t call him with where AMD is trading. The wheels start turning in his head a moment before his eyes snap open in the morning. I didn’t see AMD on the tape so I didn’t even know there was news out. I put my head down and hope to go unnoticed. And I pray that I got his breakfast order right.

But this day is going to be different. Gary’s fruit cup and yogurt are fine, but on my terminal, Goldman Sachs is showing that we bought 100,000 shares of IBM yesterday. I booked a sell. This is a problem. A huge problem. I immediately hit the Goldman light and ask our sales trader John. He confirms it was a buy.

“Are you sure?”

Yes, he says. He traded with Gary. So now it means one of two things: either Gary accidentally told me it was a sell order when it was actually a buy, or he told me it was a buy order and I accidentally typed it in as a sell. Either way, it’s going to turn out to be my fault. What makes the matter worse is Gary, Dave, and Raj have been basing their trading decisions on the wrong position. We began the day owning 100,000 shares of IBM. If I had booked the 100,000 that Gary said he bought, we should be long 200,000 shares. Instead, our portfolio reads that we’re flat. IBM is trading around $130. My mistake, if I made it, is a risk to the firm of $26 million. Chances are, IBM isn’t going to zero, but a major fluctuation in the stock could still cost Galleon a lot of money.

My desk is a few feet from Gary’s desk, but I decide to get up and walk over. No need for everyone else on the desk to hear what I have to tell him. He’s on the phone, and doing three other things, but I interrupt. He sees the expression of dread on my face and immediately knows something’s wrong. He lets the phone drop to his shoulder and looks at me with disdain.

“What’d you fuck up this time?” Gary never misses an opportunity to crush me. He’s the nine-year-old, and I’m the spider whose legs he relishes pulling off one by one.

I don’t have a choice. I have to tell him about the error.

“I just need to know if you bought or sold IBM with Goldman yesterday.” It’s my last hope. Maybe Goldman fucked up the trade.

“I bought ’em,” he says. “You know that, I yelled it over to you.” Worry begins to churn in my stomach. This is not good.

“I’m sorry, I, I musta heard you wrong or, or I typed it in wrong,” I say.

“So you’re fucking telling me we are long a hundred IBM?”

“Actually, two hundred,” I say. He looks at the futures to see how the market might open. Last I checked they were down small. He asks Keryn if IBM is trading. She types it into the computer quickly and gives me a sympathetic glance. The last two years she’s been dealing with him, but for some reason she can control him better than most.

“There’s only a few thousand on the tape,” she says, “but I’m sure I can get someone to put me up at last night’s close.” In other words, she will just call a broker and tell them to put 200,000 shares of IBM on the tape and they will assume the risk. She’s trying to help me, but Gary stays livid. He starts shouting about how incompetent I am. He screams over to Raj to tell him the IBM position is off, and then he screams over to Dave to tell him the same thing. He doesn’t have to
scream it again, but he likes to humiliate me. I start to walk back to my desk.

“Where the fuck are you going?” he asks. “Get back here.” He throws what’s left of his breakfast in the trash can. I don’t know what else to say. I look at him, but I can’t hold his stare.

“I’m sorry,” I say finally, and start to walk back to my desk again.

“Oh no you don’t,” he screams. “Stand in the corner! Five minutes!”

I look at Gary and then the corner of the room. I think he’s serious. Dave starts to laugh and Keryn and Todd-o are trying not to. Even Gary and Raj are smiling. Gary goes straight-faced again and points to the corner at the other end of the trading desk. I’m not sure what to do. I walk over to the corner. I don’t say a word. I face away from the desk about two inches from where the walls connect. I’m almost thirty years old and I’m stuck in the corner like a first grader. I close my eyes. I hear chuckling behind me. I think they’re grabbing analysts and assistants from other parts of the office to have them look at me. Maybe Gary did say “buy,” but why would I type “sell”? I want to laugh. The idea of an adult professional having to stand in the corner is comical, even if the adult professional is me. Now I have to try to stifle the laugh and pretend I’ve been humiliated or Gary will think up some other punishment. After two minutes, Dave yells over and tells me he needs me for something. I know he’s making up an excuse and I’m thankful. I run back to my desk. He tells me I can’t make mistakes. Fifteen minutes later Gary’s on the phone belittling a sales trader from Herzog.

I have a better chance of predicting the market than I do Gary’s moods. He doles out punishment just for the sake of punishment. It really has nothing to do with my performance or lack thereof. In fact, only a few short weeks after the corner incident, Gary tells me he
wants me to start trading on my own. “Trade fives and tens,” he says in between bites of perfectly buttered bagel. “And make money.” It’s that simple. In comparison with the share amounts Galleon is doing, 5,000- and 10,000-share lots are insignificant. Yet, for me, it’s a defining moment.

That morning, I wait until ten a.m., when things have slowed down a little. The last message I want to send to the bosses is that I’m too busy trading my 5k lots to perform my daily responsibilities. I decide to buy 5k shares of Microsoft (MSFT). It’s liquid, so I can get in and out without any hassle. I have no basis for my buy other than it seems like the other traders on the desk are buying tech stocks today. The market is up small and if techs take off maybe MSFT will too. I book the buy into the system. The stock trades up a quick dime. My chair is adjusted so both of my feet are firmly on the ground. I’m rolled up so close to my desk, it pushes against my stomach. I focus on only MSFT on my computer screen. Each tick upward vibrates in me like the bass beats from a sound system in a club. I want my first trade to be a profit. I’m not sure what to do. It keeps ticking up: .11, .12, .13, .14 … I hit the Lazard light and tell Langel, our sales trader, to sell 5k MSFT. “Sold, 5k MSFT forty-five point fourteen,” he says. I scalped my first trade. I book the sell order into our system. I made .14 on 5,000 shares! But I paid .06 commission on both sides, on the buy and the sell, so my profit is only .02. The reason we pay brokers .06 a share is for their research, resources, and facilitation. In order to get the kind of service Galleon wants, we have to pay brokers millions of dollars a year. For my personal trades I can’t afford to lose so much on commission. I look at our performance screen. I see symbol MSFT—shares 0—profit/loss +$100.00. Woo hoo! A hundred bucks! But it’s better than a loss, and now I’m ready for my next trade.

I want to buy QCOM (Qualcomm). I lost all of my profits on
commissions, so I’m going to buy it on the Instinet machine so I only have to pay a .01 commission. I click on the buy button, type “QCOM” on my keyboard, type “10,000,” and hit send. I look at my screen; I bought ten, thirteen, twenty, thirty thousand shares.
What’s happening?
I keep buying more shares. Up, up, and up. I can’t stop it. I look at my 0 button and it’s stuck in the down position. The keyboard they gave me was the oldest, crustiest one they had. Oh my god, I just bought 100,000 shares of QCOM. I’m not sure what to do, and then I hear Dave scream, “QCOM being downgraded by Merrill!” He has no idea I bought the stock or that I bought 100k shares of it. The stock is down four points before I even realize what’s happening. In a matter of minutes I’ve lost $400,000. I have no idea what to do. Dave stands up and leans over to my computer screen. “Jesus Christ,” he says. He hits the J. P. Morgan direct wire and tells him to sell 100,000 shares of QCOM, on the wire. Meaning it will be done before he hangs up the phone. And as he does he says to me, “You’re welcome.” The stock is in a free fall. QCOM is down another six quick points, but now the broker is on the hook for the extra $600,000, not us.

Dave calls the broker later to thank him and tell him we owe him one. “You owe me ten,” the broker responds. No one says a word to me the rest of the day, but I don’t have to stand in the corner, either.

My days at Galleon are difficult. I have no confidence. I’m always looking over my shoulder waiting for a kick to the face for not booking a trade right or not picking up the phones fast enough. When I scope out the room I see brash, overconfident traders who push around anyone on the other end of the phone. Outside the office they appear like everyone else in Midtown, but in the office they have swagger. This seems to be a prerequisite for all buy side traders. I don’t think you have to be a bully to succeed in trading, but it sure helps. And on a trading desk filled mostly with bad cops, it’s only natural for me to
assume the role of good cop. I bend over backwards to help the salesmen who cover us. They’re ecstatic when I pick up the phone. It means they aren’t going to get a tongue-lashing for whatever trading sin they might have violated, or for merely being born. They always want to take me out to dinner or meet for a drink. Sometimes they even offer to take me to a game or a concert. I get asked at least three to four times a day. I never want to say yes. I’m afraid they’ll ask me questions about the market. Questions I can’t intelligently answer. They’ll realize I’m a fraud and don’t belong.

One day Gary tells Keryn, Todd-o, and me to meet him in the conference room after the closing bell. Todd-o appears bored, Keryn is texting someone, and I feel like I might puke. I’m not sure why he wants to talk to us. We wait. Gary saunters in and pulls out the seat at the head of the table. Todd-o is now alert, Keryn’s phone is put away, and I can’t stand not knowing what the meeting is for. I focus on Gary’s lips. I want to anticipate what he might say. “Who’ve you been out with this month?” Gary asks, primarily looking at Todd-o and Keryn. They respond with a couple of business dinners they’ve been to. It sounds to me like Keryn is exaggerating, but I know Todd-o goes on some dinners. Then Gary looks at me. The only people I’ve been out with are Ethan, Jason, and Jayme, and we crushed it at Red Rock West on Saturday. I almost lost an eyebrow from the bartender’s fire-breathing stunt, but I know that’s not what he’s talking about.

“No one,” I respond.

He mimics “No one” like a five-year-old. “Play the game,” he barks. “Get information.” He knocks his hand on the desk a few times as if we were sleeping. “If you guys want to continue working here,” he says while wiping the scuffs from his dress shoes, “then you need to start getting some calls.” Keryn and Todd-o nod. “I don’t mean the
great calls we’re already getting—I mean new ones.” He stands up and adjusts his shirt into his pants and turns for the door. “We have a new requirement here: you have to go on at least two business dinners a week. I want you to write up who you went out with, what you discussed, and how you improved the relationship,” he says. Then he leaves. Todd-o follows Gary out of the room; Keryn reaches for her phone to finish texting. I don’t want to go out with the sell side.

I guess the reason I agree to grab dinner with John first is because he rarely discusses business. Skinny with a beer belly and goofy, he’s not your typical Goldman Sachs employee. He’s more like a cartoon character. Whenever he picks up the phone he’s usually giggling about a prank he pulled on his desk-mates or telling a fart joke. He cares more about trying to make us laugh than being a sales trader. John is a few years older than I am, but it seems like he’s been in the business forever. He’s at the bar of the Upper West Side location I picked when I enter. He told me I could pick any restaurant in the city. I want to be close to my apartment. If things go bad I can just run out of the place and go home. Halfway through the first cocktail, I realize he just wants to get to know me. He likes me; he wants to be my friend. He’s fun. We order food at the bar. He asks me tons of questions about the guys I work for. He wants the dirt. I’m scared to tell the truth. By the third or fourth cocktail I’m feeling more comfortable and am willing to speak more freely about Galleon. “If I make a mistake,” I say, then take a sip of my drink. “Regardless if it cost the firm money or not, they get medieval on my ass.”

“That’s standard operating procedure,” he says as he lights up a cigarette. “Do they hit you?”

I think he’s joking. “No.” I point at his cigarettes and ask for one with my facial expression. It’s not my first one ever, but close.

“Look,” he says. “Are they paying you well?”

“Yeah,” I say. “I’m not sure what my bonus is going to be, but we’re making hundreds of millions of dollars, so I’m hopeful.”

“Then don’t worry about it,” he says.

“I guess,” I say. I want to say more. I want to defend my point, but he makes a valid one too. If they’re going to pay me a lot of money, they can do whatever they want to me.

“You wanna hit a strip club?” he asks as he takes his last bite of steak.

“No thanks.” I stand up and put on my coat. The strip club fascination is lost on me. I’d rather talk to normal girls.

After he pays the check he tells me there’s a car for me outside. I live just ten blocks away and tell him I can walk it. “What are you, Mexican?” he asks. I’m not exactly sure what being Mexican and walking have to do with each other, but I just smile and tell him I can hoof it. “No,” he insists, “take the car.” It doesn’t make any sense, but I open the car door and thank him again for the night. “We can do it every week if you want,” he says. The car is all black; the backseat feels more comfortable than my couch. I ride the ten blocks home in silence. The driver must think I’m an asshole. I feel like I should tip him or something, but I’m not sure exactly how this works. I watch the city blocks pass me. I feel like I’m in a movie. I could get used to this. When we get to my apartment the driver smiles and tells me to have a good night.