Software Nerd

Sunday, November 23, 2008

Mean Bankers

In Atlas Shrugged, Part 1, Ch X: a businessman wanna-be whines "... I worked like a dog, trying to get somebody to lend us the money. But that bastard Midas Mulligan put me through the wringer." Mulligan is portrayed as a tough banker who was able to identify people with good credit (who would pay him back, and then some) from bad.

It was he who had invested in Rearden Steel at its start, thus helping Rearden to complete the purchase of the abandoned steel mills in Pennsylvania. When an economist referred to him once as an audacious gambler, Mulligan said, "The reason why you'll never get rich is because you think that what I do is gambling." [Atlas Shrugged]
I was reminded of Mulligan, when I read the following description of James Stillman, a prosperous banker from the late 1800's:

"A caller would enter Stillman's office, assured, perhaps a little enthusiastic. Without a word the dark, elegant little man at the big clean desk would motion him to a chair upon which the light fell full. He would look at him, quite impassively, through veiled, impersonal eyes. The man would begin stating his case.

Minutes would pass. The caller would make assertions that seemed to require response. Not a sound from the grave, composed Buddha at the desk, whose eyes seemed to have penetrated through the other to some distant spot in the room. The visitor would fidget, cough, and finally finish what he had come to say.

Invariably would follow a long, cruel pause.

Then, as if from far away, [Stillman] would begin to speak. In low, impressive tones he would rip the proposal to shreds". (Source: John Wrinkler, quoted in Money of the Mind, James Grant, 1992 page 67)

Consider this though: despite the description above, Stillman is said to have made many loans, actively prospected for new business, and his bank expanded rapidly. [Source: James Grant 1992]

If only we had some more mean bastards running our banks, we would be in better shape today.