Gunny Walker

Greetings Folks. I've been reading a very interesting book for the pat couple of days called The Number : How the Drive for Quarterly Earnings Corrupted Wall Street and Corporate America. It's a pretty good book. I've been reading it at about 50 pages a day and considering it's only 250 long, I'll be done with it soon. It does however have some very interesting passages. Some of which struck me enough to think, "Gee whiz, I should put this in the blog. It's crazy." Of course, I went back over the pages and found several other things I found interesting. Some of them I hope to include here, but some of them I'm sure I'll go back and look at and say, "Nah, that's interesting to me, but I'm not sure that the average person will know why I find that interesting." Anyway, I thought that I would post the beginning of the first chapter. It paints a very interesting image about what the market was like after the crash of 1929.

It had been a very long week for J.P. Morgan Jr.
Morgan - the world's leading financier, the personification of Wall Street - had endured days before the Senate Banking and Currency Committee about his firm's misbehavior during the 1920s boom and the crash that followed. Under pointed questioning by Ferdinand Pecora, a hard charging New York prosecutor who was the committee's chief counsel, Morgan admitted that he and many of his partners had not paid any taxes in 1931 and 1932, with the depression at it's worst. He acknowledged at the height of the bubble, his firm had offered government officials the chance to buy shares in a hot new company at below market-price. With 25 percent of all Americans unemployed, with banks failing and farmers starving, these revelations did elicit great warmth. A generation later, The New York Times would call the inquiry "remarkable for its unfriendliness even in that year off banker's general unpopularity."
That year was 1933. And on the first day of its sixth month - Friday, June 1 - at 10 a.m., in a Senate hearing room crowded with reporters and photographers, Morgan and his aides waited for another difficult day to begin.
Then the midget showed up.
The reason Lya Graf came to the Senate that day has been lost to history. Her employer, the Ringling Brothers and Barnum & Bailey circus, was in town, but Graf had no obvious to make her way to the Capitol. Perhaps Ringling was looking for some easy publicity; a Ringling press agent named Charles Leef had accompanied her. Perhaps she wanted to see Morgan in the flesh. If so, both circus and midget got their wishes. Ray Tucker, a reporter a reporter for the Scripps-Howard news service, saw Graf in the crowd outside the hearing room and pulled her in. "I'm going to introduce you to J.P. Morgan," Tucker said. And he did. Photographers swarmed and reporters rushed to capture every word of the not-very-interesting conversation between Morgan and Graf. (Morgan: "I have a grandson bigger than you." Graf: "But I'm older") Then Leef, the press agent, picked up Graf and popped her onto Morgan's lap.
  In pictures of the incident, Morgan looks stunned and Graf amused, her arms spread wide. Richard Whitney, the president of the New York Stock Exchange and Morgan flunky, quickly sent Graf off, and Morgan recovered his composure.
  But he could not recover his reputation. In a moment, he was transformed from a powerful plutocrat to confused old man....
  A midget had sat on J.P. Morgan's lap. It would be two generations before Wall Street and corporate America again ran so far amok during a boom or were so badly humiliated in the bust that followed.

  I don't know. This makes the Enron/WorldCom/Imclone/Tyco circus look mild by comparison. I guess it may be as bad, but Martha never became a circus sideshow.
  There are a couple of notes here. The kind that are in the back of the book and tell you that this story came from The New York Times Magazine's article titled "Thirty Years Ago: A Midget Sat on J.P. Morgan's Lap and Showed the Great Banker Was Only Human" (May 26, 1963, p 50.)
  The other note of interest is one of sadness. It's a bit of "Whatever happened to?" It says that in 1935 Lya Graf, whose real name was Lia Schwarz, returned to her native Germany. Half Jewish and a midget, she was arrested by the Nazi's in 1937 as a useless person. She was executed later in the gas chamber at Auschwitz. It sad whenever people talk about people being exploited in freak shows. In freak shows, we make them celebrities. In the real world, we often make them corpses.
  That's all for today folks. I'm going to read some more. Or sleep, I don't think that I've gotten my full eight today.
  Read The Number : How the Drive for Quarterly Earnings Corrupted Wall Street and Corporate America. It's a pretty good book.