Busted, at Rick's Café Analyste

Welcome to Bankablanca, where the SEC rounds up Wall Street's usual suspects, Sam plays the piano, and we'll always have 1999

By Joan O'C. Hamilton

A fan spins lazily overhead here at Rick's Café Analyste. The air is smoky. Morgan Stanley's Mary Meeker, in a cloche hat and trench coat, sits at a wicker cocktail table, eyes furtive. Merrill Lynch's Henry Blodget walks by in a smoking jacket that has seen better days. He leans against the piano, peering into his Blackberry pager like a man looking for his soul in the bottom of a martini glass. In anguish, he turns to the piano player: "Nasdaq's down another 30, Sam -- say it ain't so, Sam, say it ain't so...."

That's how it goes, here in Investment Bankablanca. Suddenly, the door bursts open: A slew of plaintiffs' attorneys stream in, accompanied by Wall Street PR honchos and Securities & Exchange Commission coppers, announcing in unison: "We are shocked, shocked to find conflicts of interest here!"

Several analysts sprint for the back door. Salomon Smith Barney's Jack Grubman is pulled kicking and screaming from the back. "This one was halfway over the Chinese Wall when I grabbed him by the ankle," snarls a beefy attorney, one paw clamped around a writhing Grubman, who loudly protests: "A year ago, you were begging me for stock tips, wanting in on IPOs."

"Shad-ap," replies the lawyer, smacking him on the shoulder with a subpoena.

"Should I become a priest or a high-tech stock analyst?"

A nattily dressed SEC commissioner emerges from the storeroom holding a laptop. "Messieurs," he calls to the plaintiffs' attorneys, who have just cracked open a bottle of Dom Perignon at the bar. "We believe many of the analysts' self-serving trades were conducted on this very laptop. Imagine profiting from the once-noble calling of informing the public about the viability of a corporation's business. Tsk, tsk. Why, years ago this business attracted a different sort. Young men would come to me for guidance: 'Should I become a priest or a high-tech stock analyst?' they would ask. 'I feel a calling to serve.' How far we have fallen."

New York plaintiffs' attorney Jacob Zamansky buys a round of champagne, waving a wad of cash he made from the $400,000 settlement his client won against Merrill Lynch. "Perhaps what we're doing here can bring about real and lasting good for all of society," he muses aloud. "Here here," shout the other attorneys, raising their glasses, bursting into a spirited chorus of the Marseilles.

Continues Zamansky: "I know I speak for everyone here when I say we attorneys consider this work a form of public service. We are here for the little guy, the ministers, the day-care workers, the retired teddy-bear seamstresses who were simply investing in companies to make just enough profit so they could increase their charitable contributions.

"It was like putting a gun to investors' heads and making them buy, buy, buy"

"So you take these innocent, gentle folks, and then these, these...analysts" -- he spits the word out like a cobra with a hangover -- "force themselves on our clients with their overly aggressive stock recommendations. I mean, have you seen those reports with their extra-large, extremely bold type? Why, it was like putting a gun to those investors' heads and making them buy, buy, buy. It's shameful business. Shameful."

A nattily dressed SEC commissioner struts in, helping himself to a couple of Cuban cigars from a snifter at the bar. "The usual suspects have been rounded up," he declares. There's a disturbance in the hallway. "I'm not an analyst," protests Credit Suisse investment-banking capo Frank Quattrone, with his hands in the air. "They're vultures, vultures I tell you. I just ducked in here for coffee."

Blodget and Meeker walk out, side by side. "We may never see Amazon at $400 again, but in our memories we'll always have 1999," Blodget sighs. "Here's looking at you, kid."

Women and children can again walk Wall Street

Wall Street PR maven Web Spinster gathers the reporters waiting on the steps for an impromptu press conference. "If anything, we should be grateful for the widespread high-tech downturn," Spinster says. "It opened our eyes that these people here, in this café, were engaged in a virtual conspiracy to exploit all those poor investors. It's beside the point that we ignored all these horrifying acts when we were all making bucketsful of money."

Then Spinster goes for his sound bite: "Now, however, with these soulless stock touters tied up in lawsuits, women and children can again walk Wall Street, safe from the distasteful specter of profiteering."

An arm around the nattily dressed commissioner from the SEC, Spinster mutters as the flashbulbs pop: "Louie, this could be the beginning of a beautiful friendship."

When she's not re-imagining Casablanca, Hamilton is covers technology from BusinessWeek's Silicon Valley bureau

Edited by Douglas Harbrecht

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