Monday, January 29, 2007

My Dear Old Mammon

I stumbled across this posting on about Edward Carr's series of articles on executive pay in The Economist and became intrigued enough to go to the source (and the source's source).

Like, I also found Mr. Carr's justification of high pay as some sort of emotional salve to encourage risk-taking by executives rather dubious. First of all, senior executive positions (especially that of CEO) carry all sorts of non-pecuniary rewards that in my experience carry at least as much weight as greenbacks. These include fancy titles, corporate jets, personal tax planners, and curvaceous journalists breathlessly hanging on your every word. (Well, perhaps the last only if you're Jack Welch or Todd Thomson.)

Secondly, I think the evidence we have seen of backdated option grants, "pay for pulse," and incentive hurdles set low enough for your average turtle to clear with ease argues rather strenuously that most executive compensation schemes have been anything but geared towards risk-taking behavior. Perhaps in private equity land Mr. Carr's formulation holds, but at least there the penalty for underperformance is summary firing and forfeiture of most of your incentive comp. In public corporation land, it is usually cause for immediate vesting of shares, options, and pension plans and a free one-way ride on the corporate jet to Boca.

Apparently without noticing, Mr. Carr does touch on the central issue underlying the public debate on executive pay. He writes:
Between 1993 and 2003 the total pay of the top five executives in the Standard & Poor's 1,500, which accounts for roughly 80% of listed American companies by value, amounted to some $350 billion, according to Lucian Bebchuk and Yaniv Grinstein, of Harvard and Cornell Universities. The share of earnings consumed by those people's pay rose from 5.2% in the first five years of that period to 8.1% in the second five. And this is without counting the value of pensions, which can boost the total by as much as a third.

Looking to the original article by Bebchuk and Grinstein, the time series is even more dramatic: the top five executives' share of corporate earnings jumped from 5.0% in the 1993-1995 period to 9.8% in the 2001-2003 span. I don't know about you, Dear Reader, but my immediate reaction to that little statistic is "Who ordered that?"

Who decided that senior executives' share of the earnings pie should double over the last decade? The last time I checked, the quality and efficacy of CEOs and their ilk has not changed much since 1993, so I doubt they have gotten twice as effective at growing earnings. You could say their pay has gone up so much because the market value of their companies grew so much (the S&P 500 rose 109% over the period), but that implies we should pay them not only for building company earnings—which are at least nominally under their control—but also for general multiple inflation in the equity market.

Mr. Carr as much as implies that:

The lion's share of the executives' bonanza was deserved—in the sense that shareholders got value for the money they handed over. Those sums on the whole bought and motivated the talent that managed businesses during the recent golden age of productivity growth and profits. Many managers have done extremely well over the past few years; but so, too, have most shareholders.

Call me a skeptic, but managing a company in a "golden age of productivity growth" with the equity market wind at your back sounds like a pretty cushy ticket. Furthermore, correlation does not prove causation. The point is not that shareholders have not benefited from the rising tide that has floated all boats, but that we seem to have been paying the captain and crew extra just because the tide came in.

You could say, as some have, that senior executives' shares of corporate earnings were too low at the beginning of the 1990s, and they should be paid with more equity to align their personal financial interests more with those of the shareholders. (This was a popular argument last century among what we used to call "Old Economy" CEOs, as they watched jeans- and sneaker-clad arrivistes buy basketball teams and leapfrog the waiting lists at their country clubs.) This argument collapses in the face of evidence that Boards of Directors just piled this new equity on top of existing cash compensation and kept increasing the cash anyway. Plus you have the little issue of option backdating, reloading, repricing, etc., which took all the downside (or at least "non-upside") risk out of the equity comp equation.

Look, the issue is pretty clear: fairness. People are not upset about Robert Nardelli's $210 million goodbye kiss from Home Depot because he failed to raise earnings. In fact, he did a pretty good job at that. What steams Joe Shareholder is that he sashayed away with wheelbarrows full of cash while creating—adjusting for inflation and the price of corn—exactly bupkus in the way of shareholder value. I mean, why should we pay this knucklehead 200 million bucks when HD shares flatlined while he was driving the bus?

Americans aren't dumb. We get it. In fact, most of us are more than happy to create gazillionaires out of sharp, aggressive leaders who can create wealth and jobs for the rest of us. They just have to deliver on their side of the bargain.

© 2007 The Epicurean Dealmaker. All rights reserved.

Thursday, January 25, 2007

Cognitive Dissonance

Yoo hooo... Mr. CEOPrivate equity is a tough racket.

Oh sure, everybody on the planet is simultaneously bemoaning the fact that PE is taking over the world and desperately trying to get a piece of the action, but still, it’s a tough racket. Unless you can swan your way through the World Economic Forum at Davos like one of the private equity plutocrats, your day-to-day life is no cakewalk. Yes, yes, we know that your firm No-Name-Middle-Market-Commodity Fund LLC has posted compound annual returns in excess of 98% since Noah crash-landed the Ark, but it’s hard to get the respect and attention you deserve with so many players on the field. More private equity deals are being done than ever before, yet it’s difficult to find good companies to invest in.

So, what do you do? You market yourself.

Now, as apparent punishment for my many sins, one of my jobs as an M&A intermediary is to periodically visit private equity shops to press the flesh and learn about their investment interests, styles, and preferences, so I am on the receiving end of a lot of this marketing. Let me make a small observation: most of you are doing it all wrong.

Mistake number one: In my experience, when it comes to investing in companies, most financial sponsors talk like girls but act like guys.

Most of the financial sponsors I talk to give highly specific criteria for the kinds of companies they are willing to invest in: minimum revenues, earnings, industry verticals, growth opportunities, etc., etc. When I sit in their richly paneled conference rooms listening to their pitch, it usually sounds exactly like the kind of comprehensive checklist some women use to screen potential husbands. You know: tall, handsome, rich, charming, exciting, good in bed, understanding, likes kids, etc. And just as unrealistic.1

On the other hand, when it comes to the mating game, men are famous for being far less discriminating. Likewise, notwithstanding their stated criteria, a lot of private equity firms end up investing in almost any company they can persuade to say yes. This is not a bad thing—it supports me and myriad other middlemen—but it does show up the gap between what financial sponsors say and what they do.

Mistake number two: The part of the conversation with a financial sponsor that I dread the most is when they start talking about how they “differentiate” themselves. Apparently, they all received the same PE trade group memo explaining that financial sponsors are no longer just financial engineers. Now, they “add value” by improving operations at their portfolio companies. They airlift a star-spangled SWAT team of The 25 Best Corporate Managers in America into each and every due diligence session and Board meeting. They employ a crack brigade of ex-GE Vice Presidents and former Navy Seals to scour expense reports for surplus paper clips. It’s not just about leverage anymore: “[Your private equity firm name here] makes companies better.”

The first time I heard this, I was suitably impressed. Now, when the 547th financial sponsor I have met trots out the same damn story, I find I struggle to suppress a yawn or a belly laugh. This is true even though I know I should feel intimidated by the 23-year old Associate with a net worth greater than the GDP of Botswana sitting across the table from me.

Now the average public company executive with undamaged temporal lobes can figure this out just as well as I can. As someone who works with corporate managers on a regular basis, let me give the three PE guys still reading this a clue as to how potential future portfolio company managers really view financial sponsors: They think most of them are assholes, and a few (maybe you?) are not.

This is the real secret of getting attractive companies to sell to you: it’s all about chemistry. Personal chemistry between the target company’s managers and the financial sponsor deal guys. If they like you, they’ll bend over backward to make a deal happen with your firm, and if they don’t, they won’t. It’s as simple as that.

Of course, ex-post facto corporate managers will always justify their decision with some flimsy rationalization like “Those guys at Skinem, Ripem and Rapem LLC really understand our company / industry / need for six corporate jets,” but don’t you believe it. They just like you. (Well, you and your money.)

The beauty of all this, of course, is that being an asshole is completely in the eyes of the beholder. The PE guy who seems like Typhoid Mary to one management team will look like Mother Theresa to another. In part, this is because—News Flash!—corporate America is full of assholes, too. Like you, they come in all different shapes and sizes, and I can guarantee you that somewhere out there is a public company CEO who thinks you look exactly like Gisele Bündchen.

So, do not despair, Dear Private Equity Reader: one day, your Prince will come.

1 Fortunately for the continuance of the human race, when it comes right down to it most women end up settling for some relatively average guy with a slight paunch, cute dimples, and a nascent bald spot, not Leonardo DiCaprio. Which is just fine, since not too many women qualify as Gisele Bündchen, either. (Besides, even Leo and Gisele couldn’t keep it together.)

© 2007 The Epicurean Dealmaker. All rights reserved.

Saturday, January 20, 2007


That's it. I'm starting a hedge fund. reports in the Wall Street Journal today that former Secretary of State Madeleine Albright is starting her own emerging markets hedge fund, Albright Capital Management. Now, I am a great admirer of Ms Albright, feisty little spark plug that she is, and I have no doubt that she pins the needle in the IQ department. But a hedge fund? Come on.

I guess she took inspiration from the actions of other prominent government officials who have recently joined the Dark Side of the Force: former Treasury Secretary (and slightly bruised Harvard Dean) Larry Summers, off to D.E. Shaw, and former Secretary of the Treasury and railroadin' man John Snow, movin' on up to Cerberus Capital. I might quibble with the implied analogy a little by noting that Messrs. Summers and Snow at least have PhDs in Economics, whereas I am ignorant of Ms Albright's economic credentials. Would I want any of them investing my kids' college funds? I don't think so.

It gives me hope, though, that I still have a chance of riding the hedge fund wave, even after the Amaranth blowup and the pathetic underperformance turned in by those supposed Masters of the Universe at Goldman Sachs' hedge fund, Global Alpha. I mean, if a Dutch pension fund can give $330 million to an untested new hedge fund co-founded by Madeleine, a few other State Department weenies, and the former head of the EPA (!), how many spondulics can I wheedle out of the naive and unsuspecting? I'm guessing gazillions, at least.

So, get ready to send in your checks and money orders ($1 million minimum), Dear Readers Investors. I'll let you know when my lawyers have drafted the documents. In the meantime, I am looking for name suggestions. It seems that all the obscure Greek and Latin mythological terms have already been taken.

How about "The TED Fund?"

1 "Descent from heaven." Before Prime Minister Koizumi banned it in 2002, high-ranking officials would often leave government service for cushy jobs in corporate Japan. In its current incarnation in the US, it just seems like the descent is a little further down. "Cerberus" indeed.

© 2007 The Epicurean Dealmaker. All rights reserved.

Ding Dong

I was rummaging through some old files yesterday and came across an interesting tidbit from a private equity conference I attended in the Fall of 2005. As is usual in such confabs, Sam Zell, founder and Chairman of office REIT Equity Office Properties Trust (and a very successful man), was invited to talk about the "secrets" to his success. He said a great many interesting things, but one interested me so much I wrote it down verbatim in my notes.

Before I hit you with the punchline, however, a brief review of the current situation would help. You may recall that private equity hegemon Blackstone Group announced last November that it was buying EOP for $48.50 per share, or $36 billion all-in. REITs are not volatile things, and commercial real estate has been on a tear, but Blackstone's offer represents a rich 5.9% cap rate and 16.9 times forecast 2007 EBITDA. The proposed deal structure includes $29.6 billion of debt, a $3.2 billion equity check from Blackstone, and—most interestingly for our readers—a $3.5 billion equity bridge from Blackstone's bankers and financiers, Bank of America, Bear Stearns, and Goldman Sachs.

Now, it is fair to say that investment banks have until recently been very leery of anything remotely resembling a bridge, ever since First Boston's near-death experience from a bridge loan for Ohio Mattress (affectionately known as the "Burning Bed"), issued just in front of the great Junk Bond Meltdown of the late 80s. Things are different this time, apparently. As the private equity juggernaut has rolled on in recent years, banks like these have gotten increasingly desperate to share in the lucrative financing fees associated with LBOs and increasingly envious of the apparently limitless simoleons their PE clients have been lighting their cigars and papering their bird cages with. Bridge loans are now routine, and I guess it should not surprise anyone that we have finally seen a multi-billion dollar equity bridge cantilevered out over the abyss, teetering on the twin pillars of Hope and Greed. In this case, the bridging banks do not even have any voting rights, and Blackstone has a six month exclusive window to syndicate the bridged equity to nice, compliant junior partners. Sweet.

Of course, the final story on EOP's buyout is not yet written, since a consortium led by Vornado and Starwood Capital has lobbed in a competing offer at $52.00 per share ($37.6 billion). If consummated at that price, this would make EOP the largest LBO ever. Sam Zell, the archetypal value investor, must be giggling into his funky Abe Lincoln beard.

Which brings me back to Sam's remark from a little over a year ago. He said—and I quote:
"You have to understand that if Wall Street was smart, I couldn't be rich."

Sam Zell is seriously rich, Dear Reader, showing up at #52 in Forbes' 400 list with an estimated net worth of $4.5 billion.

Is that a bell I hear, ringing?

© 2007 The Epicurean Dealmaker. All rights reserved.

Wednesday, January 17, 2007

Affirmative Action


To: Joe Gregory

From: Dick Fuld

Re: The Latest Investment-Banking Bonus: A Life

Dear Joe -- What the $%@#!* is this?! I leave on a little ski vacation for a week, and Lehman Brothers goes to hell in a handbasket! I mean, jeez, we're the lead story in this $%@#!*ing abomination. I'll never live this down at the Maidstone Club.

"Encore?" What kind of a dumbass name for a program is that? I didn't even know we had a $%@#!*ing "Chief Diversity Officer." Did you hire her when I was out of town?

And you! I can only hope you were misquoted in this article. "We can be the best company only if we get and keep the best people." Since when is that? In my day, we didn't give a $%@#!* whether we kept any of those sniveling little Analysts and Associates in the Firm after we had used them up. And, the last time I looked, those were the only guys working 100 hours a week. Kleenex, I say. Why change over 30 years of industry practice just because some weenie in HR claims we need to boost our "diversity?"

I better get some answers, and quick. My Gulfstream leaves from Gstaad tomorrow morning at 10:00 am Swiss time. I expect you, this Anne Emi person, and every other $%@#!*ing Department Head in the Firm on a $%@#!*ing conference call to discuss this at 9:00 am Swiss time (3:00 am Eastern) so we can figure out how to extract ourselves from this $%@#!*pile.

Wake up my Assistant so she call plug me into the call, too.


© 2007 The Epicurean Dealmaker. All rights reserved.

Tuesday, January 16, 2007

"I Want to Be a Real Boy"

Commenting on the "truthiness" of corporate communications during hostile takeovers, Andrew Sorkin of the New York Times DealBook recently wrote that
[CEO of Delta Air Lines Gerald] Grinstein is just the latest executive who, faced with an unsolicited offer, seems to be speaking out of both sides of his mouth. Too often, executives seeking to fend off unwanted takeovers make claims that end up looking foolish in hindsight. In their desperate attempt to ward off bidders, executives make every excuse in the book, but rarely say what they really mean: Show me the money.

Truth, it would seem, is the first casualty in a takeover battle.

Umm, yeah, that sounds about right.

Now, before you go and join Mr. Sorkin in getting all of a lather, Dear Reader, it would behoove you to remember that all external communications made in the course of contested M&A situations are only a fragmentary record of true events and a necessarily limited one. When a deal goes hostile, the lawyers take over driving the bus, and they impose strict limitations on what a CEO or any other executive is allowed to say in public. They look to the potential implications of all statements in the light of potential future (or current) court action, so CEO communications necessarily appear stilted and strangled.

On the other hand, we must realize that a hostile takeover is always a negotiation in some form or another, always with many more than two interested parties involved. No one likes to negotiate in public, and you cannot negotiate effectively in any context if you are transmitting full and transparent information to the other side(s). Hence, we see shadings of truth, selective emphasis, omission of key information, and misdirection ("lies," in the common parlance) in even the most anodyne of negotiations, much less in the high stakes poker game of hostile M&A.

This is not necessarily a bad thing. Stakeholders of every stripe—employees, shareholders, etc.—should demand that their executive management play the game sharp and hard, in order to satisfy their heightened fiduciary duties. If that means that the executive in question comes off sounding like an oaf, or a shifty rascal, that's just too bad for him or her: it comes with the territory and, we might add, the paycheck.

Of course, neither of these points justifies outright fraud or “excessive” lies. My point, however, is that the context and development of a hostile takeover means that the only final arbiter of what constitutes “excessive” will necessarily be a judge or jury in a court of law.

The court of public opinion, led by the commentariat like Mr. Sorkin, will render its own verdict. As you see.

© 2007 The Epicurean Dealmaker. All rights reserved.

Monday, January 15, 2007

Bon Voyage

An Open Letter to Equity Private

Re: The King's English

Dear EP — I hope this message finds you well. Perhaps you are already in place in Old Blighty, watching out for crazy drivers roaring down the wrong side of the road and deciding whether you should incorporate the Brits' quaint spellings ("rancour," "stigmatise") into your postings on Going Private.

I do hope you will continue your blog. Firstly, for selfish reasons, because I have linked to GP from my own blog, and I always need fresh and funny content. Secondly, because I hope you realize that much of your audience is composed of people like me, old and battered specimens who do not have the wit or wisdom to find another profession. We would find your ongoing sardonic observations from London a continuing breath of fresh air. Sadly, the young tadpoles you have been trying to warn away from private equity do not seem to be listening, anyway. Besides, think of all the new material you will get!

Speaking from my brief experience as a City expat in London, I think you will find your stay there more agreeable than you expect. The food is better than you think (if you eat out), and, as an American (I know, I know, you have not definitively identified yourself as such, but, really), you will find more people are disposed to like you than you think. Heck, most of the people you will work with in London are Americans, anyway.

Except for the Brits and the Europeans. Watch out for them.

Cordially Yours,

The Epicurean Dealmaker

© 2007 The Epicurean Dealmaker. All rights reserved.

Sunday, January 14, 2007


Ya gotta love Carl Icahn.

The man knows how to turn a phrase, particularly in the presence of someone from the media, who eat up his bomb-throwing pronouncements like candy. Take this example, which was cited from a recent article in the neighborhood news rag for the Park Avenue set, Avenue magazine:
“The C.E.O. is the fraternity brother type who is great to have a drink with. He’s a survivor and maybe not all that smart, but he works his way up the ladder in the corporation. And if you’re a survivor, you never have someone beneath you who’s smarter than you. So you eventually work your way to C.E.O. You have someone a little dumber than you underneath, and eventually we’ll have morons running everything… which we’re getting closer to.”
Morons. Wow.

Now, you can argue with Carl’s premises, and you can smirk at the reductio ad absurdum of his argument, but you cannot deny that Carl does not seem to like or respect many CEOs. The interesting and somewhat surprising thing to me is that this is a pretty widespread attitude among the financial community, whether you are talking about investment bankers, private equity professionals, or hedge fund guys. Why is that?

Well, as with so many things, I think the answer goes back to high school. Unlike their suave, dashing, and debonair image in the media, cultivated with $5,000 suits and European grooming products, most of the Masters of the Universe now stalking Wall Street and its environs used to be… wait for it… Nerds. That’s right: while the future CEOs of America were playing varsity football, dating the hot cheerleaders, and polishing the social and political skills they would need to run multinational corporations, the future financial leaders were doing extra credit homework problems and watching “Speed Racer” on TV. Trust me, I speak from (sad) experience. Now that the handmade shoe is on the other foot, as it were, and the popular media breathlessly hang on their every word, the financial guys are just getting their licks in.

For what it’s worth, my experience tells me that the distribution of morons is pretty uniform across all socioeconomic groups, including investment bankers, PE guys, and hedgies. How do I know? Well, being a relatively smart and aggressive guy myself, I use the same definition for “moron” as Carl Icahn does: any idiot who does not agree with me.

© 2007 The Epicurean Dealmaker. All rights reserved.

Saturday, January 13, 2007

A Stunner

Now, breaking news for those poor souls who still believe the drivel they were taught in business school, namely, that all economic actors are fully rational, value-maximizing robots with only economic values in mind. Are there any of you still out there?

BusinessWeek article via the New York Times Dealbook1

1 Pace the New York Times, "vengeance" is spelled with an "a."
"I'm just going to the kitchen for some food, then I'm going to tell you a story that will make your balls shrink to the size of raisins." — Notting Hill

© 2007 The Epicurean Dealmaker. All rights reserved.


I am reluctant to post this so soon after the launch of this blog, for fear that readers will come to the conclusion that I am nothing but a hopeless crank (rather than a clever and sophisticated guide to all things M&A) but, after all, hopeless cranks can't help themselves, can they?

A polite suggestion to all would-be writers: USE A DICTIONARY!

I can't stand it when someone who should know better mangles the English language in print in an attempt to sound clever and sophisticated, particularly with a malaprop derived from French. My two favorite (?) examples from the scribblings of various investment bankers I have been privy to are "cache" and "marquis," as in "This company has true cache" and "This is a marquis deal."

No, no, no, Mr. Ambulance Chaser. What you should have written is "This company has true cachet" or "This is a marquee deal." Unless, of course, you mean to say your company has "a hiding place for treasure, provisions, ammunition, etc." or your deal is somehow connected to "a foreign nobleman ranking between a duke and a count." Now, were either of these latter statements true, you might actually attract more attention from your intended audience, the buy side, but from my experience something so unusual or interesting is rarely the case.

Also—although I cannot prove this as a rule—the use and misuse of such words seems to increase the higher up an investment banker rises in the dealmaking firmament. After all, I suppose one cannot expect Mr. Division Co-Head to pay attention to such trivialities as proper English usage when he is concerned about making his next mortgage payment on the East Hampton mega-mansion.

Having now unburdened my chest of this particular chestnut, I fully expect you Dear Readers to call me out for the inevitable inaccuracies and shameful mistakes I expect to make in writing this blog. Let the flaming begin!

© 2007 The Epicurean Dealmaker. All rights reserved.

A Cautionary Tale

Here is an amusing and instructive link from the blog of one of the more trenchant commentators on the private equity scene and a personal favorite of mine, Equity Private. One can draw any number of morals from this sad story of a naive and overmatched CFO and his team dueling with a financial sponsor over value: caveat vendor, never bring a knife to a gun fight, etc., etc.

If you are the impatient sort, like me, just skip down to the dialogue section, where the action begins. Here is the entire posting.

By the way, what is perhaps even more instructive is that the PE firm decisively won the battle (over value) but lost the war (the company).

There is no justice in M&A land.

© 2007 The Epicurean Dealmaker. All rights reserved.

Friday, January 12, 2007

“Iacta alea est”

Afficionados of Ancient Roman history (and the current HBO series Rome) will recognize the title of this inaugural posting as coming from our good friend and paragon among alpha males, Gaius Julius Caesar. It translates roughly as “the die is cast.” Caesar supposedly uttered this phrase as he crossed the river Rubicon, ancient and sacred boundary of the Roman Republic, in full war regalia at the head of a fully armed legion of crack Roman troops. Other Romans, historians tell us, considered this to be very bad form, at the least.

Caesar went on to oversee what we might call a successful hostile takeover of the Republic, ultimately appointing himself as Dictator for Life. Eventually, of course, some disgruntled senators took it upon themselves to restore the Republic (or at least get rid of Caesar), and the poor fellow ended up expiring on the Senate floor in a pool of his own blood. Now—minus the dodgy togas and the bronze daggers—this scenario draws so many parallels to the current state of play in mergers and acquisitions, corporate governance, and executive behavior as to make the head spin. Substitute, Dear Reader, the names of prominent companies, executives, directors, shareholder groups, and hedge funds of your choice into the preceding scenario in almost any order, and it is likely you will create a coherent and understandable picture of recent developments in the global M&A markets. “Et tu, Robert Nardelli?”

Now my point in the preceding rant was not to make you think this blog will become a specious exercise in drawing historical parallels to current events (although that can be fun too, sometimes). Nor was it to imply that my starting this blog is even remotely of similar importance to Caesar’s declaration of war against the Republic of Rome (although—let’s face it—all bloggers are convinced that what they have to say is worth reading). Caesar’s point was that he had literally crossed the line, and there was no going back.

I think I am trying to say the same thing. I have started this blog to comment on what I consider to be a fascinating part of the global economy: the global market for M&A and its various inhabitants, participants, and miscreants. Hopefully I will be able to relate some interesting anecdotes, a few enlightening opinions, and a couple of amusing stories that will shed a little more light (or a little more laughter) on what remains for many a murky area best left to investment bankers, corporate lawyers, and other such terrifying bogeymen.

Now, Gentle Reader, put your hand in mine and I will lead you to Wonderland. As that other preeminent takeover artist, Austin Powers, said, “I won’t bite… hard.”

© 2007 The Epicurean Dealmaker. All rights reserved.

Wednesday, January 10, 2007

Topics Addressed in These Pages

These topics will be added to, deleted, and modified at the whim of the editor. No returns, exchanges, or refunds will be accepted. (Last modified February 2014.)

ad hominem — Scurrilous slander, vile calumny, and cheap shots levelled at those among the Great and Good deserving of such treatment (i.e., most of them). A perennial favorite of our readers, and one guaranteed to continue ad infinitum, given the reliably ludicrous and pathetic behavior of said G&G.

amicus curiae — Possessing absolutely nothing whatsoever in the way of a legal education or basic knowledge of the laws and precedents of this or any other land, I nonetheless feel completely entitled to comment on any and all items concerning legal cases, courts of law, and lawyers which strike my fevered fancy. Isn't blogging wonderful?

bon mots — Memorable quotes and other tidbits authored by persons not formally employed by TED or its Cayman Islands affiliates.

filthy lucre — You wanna see me go red in the face, my ears smoke, and my teeth grind together? Then just get me started on the subject of compensation in the world of finance. Now that Aunt Millie has lost her house selling naked put options on Bear Stearns, every slimly credentialed noob and knucklehead in the Western World has an opinion on banker pay and manages to get it published in the mainstream press. I take a deep breath, calm myself, and try to inject a few facts and a little reason—along with a little of my trademark vitriol, natch—into this vexed debate. Fire-resistant gloves recommended for handling.

Folly — A catch all topic, which should be self-explanatory to anyone with more than a third grade reading level.

fourth estate — Affectionate gibes and tender pokes at the follies, pretensions, and general misdeeds of our fellow bloggers and friends among the financial press and mainstream media. Always good for a cheap laugh.

ghost in the machine — Discursions on financial bubbles, the madness of crowds, animal spirits, and other evidence that the relationship of rationality to human behavior in the business and financial spheres is tenuous, contingent, and highly suspect.

gray flannel suits — Dispatches from the bowels of Corporate America, in all its craven, sclerotic, and bombastic glory. Proven to be an effective antidote to overdoses of Fortune, BusinessWeek, and other corporate panegyrics.

Hogwart’s School of Witchcraft and Wizardry — So you really, really, really want to break into my industry and become an investment banker, do you? Even after reading more than one of the posts on this site? You poor, misguided fool. Well, I should know better than to try and stop you, so you might as well start here.

Kulturkampf — Mix together money, power, art, and high- and low-culture. Put in a blender on "puree." Serve chilled, with a dash of vitriol for garnish. Yum.

over there — Our intrepid reporters scour the globe for proof that countries other than the United States are also blighted with stupid, deceitful, and foolish morons cluttering the business, financial, and economic landscape. We have warehouses full of supporting evidence, which only await translation for publication.

philosophy — The occasional descent into mawkish self-regard, gratuitous pontificating, and specious sophistry you would normally expect from a website named after a long-dead Greek philosopher.

private equity — What, have you been asleep? Fail to renew your subscription to all newspapers and magazines other than Hello!? I fear this topic will continue to balloon in number of posts contributed as long as the current (May 2007) boom in PE fundraising and investment continues. After the bubble bursts, this topic should fade into justified obscurity on the dusty back shelf of the archives room, where it belongs (and where many of its practitioners would prefer it had remained). Update, March 2008: Dusty obscurity it is, but this is a topic which just keeps on giving. Keep your eyes peeled.

selling short — Shits and giggles about hedge funds and their peccadilloes, large and small. Most of these guys have more money than Henry Kravis and less time to have gotten used to it. A promising topic, from which we at TED expect a lot in the future. Timmberrr!

the agora — General bombast and ax-grinding on the behavior and nature of financial and other markets, not elsewhere classified. Getcher hot chestnuts here!

The Canon — The best of the best. Diamonds among sapphires. Pearls before swine. You get the drift.

the distaff side — A clean, well-lighted location in which rare posts on this site having to do with women are bathed in candlelight, perfume, and flowers. Mostly to do with why so few of the delightful creatures inhabit my industry, natch, but enlivened with an admixture of love, sex, and fashion. Just like Cosmo.

the leafy groves — of academe, natch. The business, finance, and other slightly distasteful practicalities of private higher education in America. From a former, current, and future paying customer.

The Life — Inside dirt on investment banking and other such whores financial service providers. Sort of like The Godfather, but with classier cufflinks.

The Panic of '08 — Armageddon. Götterdämmerung. Severely reduced spending at Upper East Side lingerie boutiques. You know: the whole ugly, sorry mess, beginning sometime in 2007 and ending ... well, ending when it's over. At this rate, you'd better stock up on Depends. You'll probably need them.

© 2007 The Epicurean Dealmaker. All rights reserved.

Monday, January 1, 2007

About Me

Simply put, an oxymoron. Or at least an anachronism.

Merriam Webster (our heroes, dontcha know) says Greek philosopher Epicurus (Greek Έπίκουρος) (341 BC, Samos – 270 BC, Athens)
subscribed to a hedonistic ethics that considered an imperturbable emotional calm the highest good and whose followers held intellectual pleasures superior to transient sensualism.

Doesn't sound like the typical M&A closing dinner to me ...

Go ahead, send your rants, raves, and scurrilous slander in to the following e-mail address (not clickable). Your Dedicated Bloggist is always looking for amusing anecdotes, juicy gossip, and weighty theoretical tomes to use as material. Just let me know whether you want to be quoted for attribution. (Bad idea, by the way.)

Who knows? One day, I may even let you Dear Readers comment directly on the site. Don't hold your breath, though.


I facilitate, justify, and advise parties to M&A transactions, when I am not advising against them. I have been doing this for almost two decades, mostly at a couple of big banks everyone has heard of and lately at an independent advisory boutique. I am one of the bad guys, if you like.

I remain anonymous because I enjoy my job, my apartment, and my family, and I would prefer not to give any or all of them up because I have insulted or ridiculed some vengeful member of the Great and Good. This is good for you, Dear Reader, because it means I will continue to insult and ridicule said G&G, which we all acknowledge to be a more amusing pastime than reading The Wall Street Journal stock tables. You are welcome.

Should you see me on the street, however, you will be able to recognize me easily. I am the distinguished looking, well dressed 6'5" gentleman with chiseled abs and gleaming teeth the size of dinner plates. Sorry, ladies: I am not available.

View my complete profile on, if you must. You will find nothing there I have not already told you here.

© 2007 The Epicurean Dealmaker. All rights reserved.

Graveyard of Slightly Relevant Quotes & Aphorisms

A collection of quotes usually appearing on the home page of this blog that, in my sole and unappealable opinion, should be preserved for posterity. This post will be added to sporadically at whim. Amusing and slightly relevant contributions are welcome by e-mail at epicureandealmaker [at] hushmail [dot] com.

I will make an effort to confirm the authenticity and attribution of these quotes, but I promise you it will not be strenuous. My sources are various in kind and authority, and will include—gasp!—the internet. I am sure you can handle it.

"Never try to teach a pig to sing. It wastes your time, and it annoys the pig."

"There are certain sins for which even your death will not atone."
Investment Banking MD, briefing an Associate on a deal

"There are many people for whom 'thinking' necessarily means identifying with existing trends."
attributed to Marshall McLuhan

© 2007 The Epicurean Dealmaker. All rights reserved.