As I mentioned, The New Yorker comes out periodically with collections of essays, grouped under different categories. There is The New Gilded Age, with pieces about the economy in the mid- to late 1990s. There is a collection of food writing, of sports writing, of comic pieces. There is a collection of Profiles. I have quite a few of them, and cherish them: I refer to them often for research or background. The subject matter is so vast!
The Fun of It is a collection of “Talk of the Town” pieces, from the magazine’s inception until now. Talk of the Town was started as an idea to report on New York happenings in 1,000 words or less. They were meant to be snapshots, as well as full three-dimensional portraits. It took some time to hammer the format into shape, and the various editors early on really wanted “Talk of the Town” to be a New Yorker tradition (which it certainly has become). In the early days, many of the pieces were unsigned. It is unknown who wrote them, although I am sure those familiar with the writing style of The New Yorker big-wigs back in the day could make educated guesses. The “Talk of the Town” pieces were meant to be concise, humorous, and informational. There is often what I would call an arch tone to them (especially early on). They use the “we” as a narrator. “We went to the jazz club last night …” That is not so much the case now. Also, the pieces feel (and in some cases are) much longer now. Writing in miniature is difficult, certainly – but you can tell, looking at the later “Talk of the Town” pieces how the style has changed and developed: paragraphs are longer, there is no more “we”, they feel much more like straight journalism pieces, done in miniature. The arch-ness is now gone, the sort of pleased-with-itself ironic outlook is gone. That’s part of the fun of this collection, The Fun of It. If you are a New Yorker reader, then certainly you read “Talk of the Town”. You know the style. It’s very interesting to watch how the section itself developed and changed over the years.
Harold Ross was big on the “we”, and he always wanted that “we” to be male. It was assumed that “we” meant men. So first off: Thanks for your openly institutionalized misogyny. Let’s just get that out of the way. But over the years, the “we” dropped out of style, and, of course, women had always written some of the “Talk of the Town” pieces, and continued to do so. Harold Ross also did not like bylines. He liked the New Yorker itself to be bigger than any individual writer. The “we” was used confidently and variously, giving the impression of a bunch of really cool sarcastic over-it people doing really cool things all over New York. It’s quite effective. Now, with bylines, it’s a bit more serious. And something has been lost in the transfer.
I actually prefer the older more arch “listen to this cool random thing WE did/saw/heard last night” style. It’s not meant to be taken too seriously.
Perfect reading for the subway: you can get through a “Talk of the Town” piece in between 42nd Street and 14th Street, no problem.
Here’s a Talk of the Town piece from 1925, a small snapshot of Gloria Swanson, who was one of the biggest stars in the world at that time. She had just married for the third time, a man named Henri, Marquis de la Falaise, which then made her a “Marquise”, which is just too perfect. She had moved to France to live for a while, and when she returned, in 1925, parades were held in her honor. This is impossible to imagine today. You think our celebrity culture today is overwrought and too adulatory? You should learn your history. Or if you do insist on making generalizations about how out of control celebrity-watching is today and how back in your grandmother’s time, none of this malarkey was going on, people were more responsible in those days, they didn’t have time for such nonsense, etc., then you certainly won’t mind if I don’t take you seriously.
I love Gloria Swanson. Here’s the piece, Author Unknown.
It’s slight. The Talk of the Town pieces are meant to be slight.
Gloria Swanson is back with her titled husband, the Marquis de la Falaise de la Coudraie. A day or so after her arrival, she journeyed over to the Famous Players’ Astoria studio, accompanied, of course, by the marquis. The reception was a touching one.
Attracted by advance announcements, a large crowd had gathered in front of the studio. The whole studio force was assembled on the steps and four policemen struggled to keep a lane open for Gloria’s car.
Suddenly the cry went up. “Here she is! ” The crowd surged forward, the quartet of police officers labored with might and main, and a smart foreign car slipped up the steps.
Out stepped a dapper chap. “The marquis!” gasped the assembled stenographers in one breath. News cameras clicked. Cheers shook the studio. Bushels of confetti were tossed into midair.
When the air cleared it developed that the dapper chap was James R. Quirk, editor of Photoplay.
When Gloria and the marquis did appear a few seconds later, it was an anticlimax. Still, it was prettily done. The marquis looked pleasantly democratic, Gloria burst into tears and everyone cheered all over again.
The marquis is tall, smartly garbed and speaks excellent English.
There is, as was inevitable, a little story of the trip over from Paris. Gloria and the marquis had been pursued daily by curious passengers and finally the star decided to grace a ship’s concert. Ranged alongside were some friends of the old lady in Dubuque. Gloria’s nose tilted a bit in midair.
The marquis leaned close to his stellar wife. “Don’t be a snob, Gloria,” he said.
Tashiana Washington and Ty Hickson, ‘Gimme the Loot’
I am a little bit in love with Gimme the Loot, a first feature by writer/director Adam Leon. It’s one of the most confident entertaining first features I’ve seen in a long time. Definitely seek this one out. It opens on Friday (limited release).
One of the fun things about this collection of New Yorker essays (focusing on the financial boom of the late 90s, written as it was all going down) is that the subject matter is diverse. An economic boom like that one affects all levels of a society, and it’s not just the Dot Com millionaires who get the full impact. There are pieces about the stock market, pieces about the Kathie Lee Gifford sweat shop scandal (that one is written by the wonderful Bill Buford), pieces about recruitment/headhunting practices on college campuses. Profiles of Donald Trump, Alan Greenspan, Martha Stewart. It’s a three-dimensional snapshot of a certain place, a certain time, our “New Gilded Age”.
Adam Gopnik, long-time staff writer at The New Yorker, wrote a piece called “Metamoney” (1998) and it’s a great example of the diversity in this collection. Our currency went through a re-design, a re-branding, if you will, in the late 90s. Gopnik’s piece is a reaction to the “New Money”. He analyzes the design elements, but, of course, since this is The New Yorker, he speculates on what it all might mean. Money is, after all, just a piece of paper. Who cares what’s on it? Gopnik’s piece combines research, analysis, and personal opinion.
It’s a lot of fun to read. It may put into words things you actually felt, like: “Wait … is this money real? This money will actually be accepted if I hand it over to a cashier??”
Money is a stand-in, a symbol. It’s a piece of paper, but it is representative of an abstract value. We all agree on this. A $10 bill is the same size as a $20, but it means entirely different things. The culture agrees on this. We all participate. We don’t question it. But it’s fun to read a questioning piece about not the value of money, but what it looks like, and our feelings about that.
Of course, I must point out that Ben Franklin was not, actually, a President. (This is also a note to Subway, whose Presidents’ Day commercial included Benjamin Franklin.)
The trouble started with the whole idea of making the New Money by fiddling around with the Old Money. The New Money, if you haven’t seen it yet, keeps the main graphic elements of the Old Money, and wiggles them a little. The medallion around the head of each President who appears on it – the same guy as before – is twice as big, and has become a simple oval; the Presidents’ faces are more detailed and three-dimensional: most of the fancy cartouche and tobacco-leaf framing elements are gone, and a brutally simple, Cubist sans-serif number is inserted on the back.
It would be easy to say that the enlarged, oversized Presidents look more like celebrities for a celebrity age. You could do it, but, as a great, undollared President said, it would be wrong. They don’t look famous. Old Hickory, who used to just stare out defiantly, below that white shock of hair, on the twenty, looks pensive and worried, while Franklin, on the C note, looks oddly like Hannah Arendt, anxious and modern. They share the quality first discovered in Richard Avedon’s portraits of politicians and then passed on to Chuck Close’s portraits of artists: anybody just looking straight ahead, if made big enough, looks guilty, of something or other. Most troubling of all, there’s a lot of blank space on the New Money. The back of the fifty, for instance, is completely borderless, white from the edges in. The old complicated framing device, all those egg-and-dart patterns, have been sucked right off. The elements are the same, but the whole thing is a lot sparer. The New Money just looks – well, the New Money looks cheaper than the Old Money.
When money changes, it doesn’t usually change like this. In France, for instance, the money has just changed, too. But in France the old paladins – Delacroix on the hundred-frac note, Montesquieu on the two-hundred – have been dismissed outright, like government ministers, and been told to take their style, their pale, imitation-watercolor palette, with them. Even Delacroix’s Liberty, who kept him company with her gallant bare nipple, has been retired. The new heroes on French money bring along their own distinct emblems: on the two-hundred, there’s Eiffel (with his half-completed tower); on the hundred, there’s Cezanne (with his card players); and on the fifty-franc note – the French ten-dollar bill, the one you really use – there’s Saint-Exupery, with his Little Prince. And not just the Little Prince but also that sheep he wanted the aviator to draw – “If you please, draw me a sheep!” – looking wistful. When you pay a bad-tempered taxi-driver in Paris today, you hand over Cezanne and his anxiety, and the driver hands you back the Prince and the Sheep and their contempt for the grownups’ money-obsessed ways. Even the British have changed their money several times recently. The Queen has been aging on it. She has been growing old – slowly, discreetly, but unmistakably. An odd, Dorian Gray-like conception: money with liver spots and lines.
Our money, though, has stayed the same for so much longer than anyone else’s that it has become fixed – evergreen. (Not even the Presidents aged, since they were all dead anyway.) It would be nice to say that our money stayed the same for so long because it was so well designed, but really its having stayed the same for so long was just a reproach to the idea that good design matters much in the first place. Like Haagen-Dazs ice cream in its pristine period, when all the flavors came in the same carton, the Old Money showed that people are remarkably insensitive to packaging when they like the product. That our tens and twenties and fifties and hundreds looked, at a glance, just about the same never seemed to bother anybody. The pretense of a mixup – “Hey, wasn’t that a twenty I gave you?” – was a con man’s line. When it comes to kinds of money and kinds of ice cream, in a country that is made of both, you can always manage to tell the flavors apart.
What the Old Money had wasn’t good design but a terrific period feeling. The Times calls the look Belle Epoque, but it was more American than that. The Old Money looked like the old Gilded Age. Though it got standardized in the nineteen-twenties, its design and its iconography date from the period right after the Civil War: the just finished Capitol, proudly shown off; the tobacco-leaf motif; President Grant as a hero. How beautifully the Old Money managed to evoke the spittoon-and-Sunday-oratory world of the post-Civil War! It was there in the way that the heraldic ribbon above Andrew Jackson put the “The” of “The United States of America” right above his head, like a hinge. It was there in the solid, shadowy lettering of “Twenty Dollars” – the kind you still see inscribed on the forgotten statues of the 1876 centennial exposition in Fairmount Park, in Philadelphia. Even the leftover eighteenth-century Masonic symbols – that pyramid! that eye! – felt reassuring. (You see, we can assimilate any cult, it said. Check out our Mormons, well groomed and orderly in Utah.) The Old Money presided over calm avenues, and it was melancholy, too, in the stately ways of Gilded Age sadness. Is there a sweeter American image than that single motorcar chuffing along outside the Treasury Building on the back of the old ten? It has stayed there right up through the era of the Santa Monica freeway and drive-by killings, still asking the same forlorn question: Will the horseless carriage ever catch on?
I have this whole thing about “things”. Objects as symbols, talismans, totems, meaningful stand-ins for some other narrative. It is a childlike point of view, perhaps: children get attached to specific blankets, toys, objects. But adults certainly retain it, although it morphs into something else, sometimes an attitude that seems materialistic. But it’s really the same thing. Objects are not casual, especially not seen through the filter of memory.
Kind of a famous essay by Malcolm Gladwell, from 1999, ‘Clicks and Mortars’ details the backend operations of Lands End (primarily), as a way to show how the catalog-product-delivery business operates: its efficiency, its ease (but, of course, the ‘ease’ can only be in place because of the huge amounts of manpower as well as the good-planning of the entire operation). In 1999, we are really in the dawn of a new age with sellers like Amazon coming up, as well as stores starting to put their stuff “online”. Okay, so you no longer “need” an actual storefront (with bricks and “mortar”). You just need pictures on a nice website and a way for consumers to “click” on what they want, and pay for what they want. But … where will the products come from? Clearly you still need some kind of actual building to house all this stuff. You may not be able to walk into an actual store called “Amazon”, but Amazon does have to own, you know, real estate. So how does that work? Will it revolutionize buying and consumer behavior? Gladwell is interested in the process of how goods reach consumers, and what that can/might mean for the culture.
As I mentioned in this post, the best class I took in college was on the Industrial Revolution. It covered all aspects, and one thing I remember discussing in class was the development of the parcel post service, alongside of the standardization of highways/roads … so that out of the way farmers in Iowa could participate in whatever people were buying in New York and Boston. The markets stopped being local. You could order what you needed from a catalog. This was a revolution. Of course there had always been “catalogs”, but the standardization of catalogs, not to mention the wide variety of things companies offered, was an enormous change. It was no longer just for niche interests, like rare books, or fine china: You could buy bras, rakes, pot holders, children’s toys, all from Sears. You could live on a dirt road in the middle of nowhere, as long as you had a local post office or a mailbox, you could get what you wanted. This developed alongside things like interstate highways, and fast-food joints to serve those who drove on the interstates (and motels, and all that – they all went together). Gladwell goes into that a bit in his piece, in the delivery process system of the burgeoning parcel post service, and how it worked, but also didn’t work. You couldn’t order food, for example. Food was offered: you could live in Florida and order potatoes from some dude in Idaho, but if the truck broke down you were screwed. (I am thinking of Cal’s plan in East of Eden to ship lettuce across the country, packed in ice. The train broke down, the ice melted, the lettuce spoiled, and the entire thing was a costly disaster.)
Figuring out how to get goods to people is one of the most important parts of our economy, and how to do so in an efficient and fail-safe manner.
Netflix is pretty brilliant, in my opinion. I have no idea how they do what they do. Yes, occasionally there is the annoyance of receiving a cracked disc. But you “report a problem” on the website, they send out a new one that very same day – AND because of the inconvenience, you are sent the next film from your queue free. And I could drop my DVD into a mailbox anywhere in the US and it would arrive, be counted as arrived, and my next shipment would be in process. It’s not a local business. It’s a brilliant model. There are many more examples.
Gladwell is writing at the beginning of that revolution. More and more people were online in a casual personal way. The revolution of shopping online had begun. What would it mean? How would that change our behavior?
What can we learn from giants like Lands’ End? How do they do what they do? Also: how is Lands End responding to the Internet revolution? It started as a mail order catalog in 1963. You could pay by check. Then you could pay by credit card over the phone. Companies had to learn to sink or swim with the Internet. How did Lands End adjust? The process can’t be entirely automated because there is always human error: SOMEONE, a human, needs to be in charge behind the computer screen. How does that work?
When you stand in the middle of the Lands’ End warehouse–while shirts and pants and sweaters and ties roll by at a rate that, at Christmas, can reach twenty-five thousand items an hour–you feel as if you’re in Willy Wonka’s chocolate factory. The warehouses are enormous buildings–as big, in all, as sixteen football fields–and the conveyor belts hang from the ceiling like giant pieces of industrial sculpture. Every so often, a belt lurches to a halt, and a little black scanner box reads the bar code and sends the package off again, directing it left or right or up or down, onto any number of separate sidings and overpasses. In the middle of one of the buildings, there is another huge room where thousands of pants, dangling from a jumbo-sized railing like a dry cleaner’s rack, are sorted by color (so sewers don’t have to change thread as often) and by style, then hemmed, pressed, bagged, and returned to the order-fulfillment chain–all within a day.
This system isn’t unique to Lands’ End. If you went to L. L. Bean or J.Crew or, for that matter, a housewares-catalogue company like Pottery Barn, you’d find the same kind of system. It’s what all modern, automated warehouses look like, and it is as much a part of E-commerce as a Web site. In fact, it is the more difficult part of E-commerce. Consider the problem of the Christmas rush. Lands’ End records something like thirty per cent of its sales during November and December. A well- supported Web site can easily handle those extra hits, but for the rest of the operation that surge in business represents a considerable strain. Lands’ End, for example, aims to respond to every phone call or Lands’ End Live query within twenty seconds, and to ship out every order within twenty-four hours of its receipt. In August, those goals are easily met. But, to maintain that level of service in November and December, Lands’ End must hire an extra twenty-six hundred people, increasing its normal payroll by more than fifty per cent. Since unemployment in the Madison area is hovering around one per cent, this requires elaborate planning: the company charters buses to bring in students from a nearby college, and has made a deal in the past with a local cheese factory to borrow its workforce for the rush. Employees from other parts of the company are conscripted to help out as pickers, while others act as “runners” in the customer-service department, walking up and down the aisles and jumping into any seat made vacant by someone taking a break. Even the structure of the warehouse is driven, in large part, by the demands of the holiday season. Before the popularization of the bar code, in the early nineteen- eighties, Lands’ End used what is called an “order picking” method. That meant that the picker got your ticket, then went to the shirt room and got your shirt, and the shoe room and got your shoes, then put your order together. If another shoe-and- shirt order came over next, she would have to go back to the shirts and back to the shoes all over again. A good picker under the old system could pick between a hundred and fifty and a hundred and seventy-five pieces an hour. The new technique, known as “batch picking,” is so much more efficient that a good picker can now retrieve between six hundred and seven hundred pieces an hour. Without bar codes, if you placed an order in mid-December, you’d be hard pressed to get it by Christmas.
None of this is to minimize the significance of the Internet. Lands’ End has a feature on its Web site which allows you to try clothes on a virtual image of yourself–a feature that is obviously not possible with a catalogue. The Web site can list all the company’s merchandise, whereas a catalogue has space to list only a portion of the inventory. But how big a role does the Internet ultimately play in E-commerce? It doesn’t much affect the cost of running a customer-service department. It reduces catalogue costs, but it doesn’t eliminate traditional marketing, because you still have to remind people of your Web site. You still need to master batch picking. You still need the Willy Wonka warehouse. You still need dozens of sewers in the inseaming department, and deals with the local cheese factory, and buses to ship in students every November and December. The head of operations for Lands’ End is a genial man in his fifties named Phil Schaecher, who works out of a panelled office decorated with paintings of ducks which overlooks the warehouse floor. When asked what he would do if he had to choose between the two great innovations of the past twenty years–the bar code, which has transformed the back end of his business, and the Internet, which is transforming the front end–Schaecher paused, for what seemed a long time. “I’d take the Internet,” he said finally, toeing the line that all retailers follow these days. Then he smiled. “But of course if we lost bar codes I’d retire the next day.”
A 40+ page essay by Ken Auletta about Bill Gates, Microsoft, and the anti-trust action against Microsoft in the 1990s. Microsoft had always been loved and hated in equal measure, and this was not the first time that the company had been accused of being a monopoly, but events had certainly escalated and the eyes of the world watched as Microsoft was dragged into the court of public opinion, and the actual court, to defend its practices. The Department of Justice headed up the investigation, although the Federal Trade Commission had also been on Microsoft’s tail for the greater part of a decade.
In college, the best class I took (outside of acting classes) was on the Industrial Revolution, and there was a giant “unit” on the passing of antitrust laws, in reaction to the giant monopolies created by the Barons of the Industry. Ron Chernow covers the Rockefeller trial in detail in his wonderful biography of John D. Rockefeller. It was a fascinating time in American history: where competition bucked up the underlying desire for fair-ness. And what happens when a company so dominates, and its practices are so rapacious, that it begins to squelch the important aspect of competition? And diversity of choice for the consumer?
It’s been a while since I read this huge piece on the Microsoft trial, and so many of the details are lost, although we all know how it turned out. I switched to Mac in 2006, after years of being a PC person, and I’ve never looked back. At my various jobs, I usually have to work on a PC and I find Microsoft quite annoying and unnecessarily so now. The “update” to Microsoft Word was so opaque, so ridiculous, that I actually had to ask someone where the “Save” button was. That is NOT a good update, Microsoft. I’ve been a User for years. You’re supposed to make it simpler, more intuitive. But I’m not particularly up to date on the workings of Microsoft now. And it’s not really relevant anyway.
Auletta’s piece is a massive accomplishment of research. He spent time with Gates, he spent time on the Microsoft “campus”, he described the culture, went to the meetings. He lays out the history of Microsoft, and its issues with its competitors from the get-go.
The issue in United States vs. Microsoft was the “bundling” practices of Microsoft, making everything a package deal: The browser was bundled with the operating software. This, essentially, cut out competitors in the browser market. Microsoft, in this way, killed Netscape, and I’m sure many others. It was easier for companies to order the bundled software/browser, than shop around, and purchase a Browser elsewhere – that, anyway, didn’t run quickly enough on the Windows software. I am sure there were many other elements in the case against Microsoft, but the bundling was the biggest. Microsoft, of course, was like, “This is bullshit.” (I told you I wasn’t an expert.) Microsoft argued that what they had developed went together: the browser and the software. It was, essentially, one product. How dare they be punished for their own innovation?
I seem to recall that the antitrust suit filed against Standard Oil had to do with their handling of the railroads (which they also owned). It was the “rebate” issue that was the real clincher. One could, of course, argue that Standard Oil was just doing what Standard Oil did best, find the best/easiest/most efficient way to get their product to where it needed to go. Of course they would buy up the railroads and offer rebates. It makes perfect sense. My college professor was so fantastic, breaking down all of the issues with these corporations, their drive, their ferocity, their success, and the corrective placed on them by the government. Every class was a cliffhanger. If you cannot imagine a group of college kids groaning in disappointment and agony when a teacher says, “Class is over – we’ll find out what happened at the trial next week” – then I am here to tell you: It happened – week after week after week!
United States vs. Microsoft went to trial in 1998. Auletta’s essay details that process, and to some degree is a Courtoom Diary, as well as a profile piece on Gates, on Microsoft’s culture and history. It’s fascinating!
Microsoft, of course, was deemed a “monopoly”.
The New Gilded Age, a collection of financial writing from The New Yorker, is essential reading. It’s recent past, but it already feels like ancient history. The articles were written in real-time, with writers trying to come to grasp the implications of the Internet, and the boom the economy was then experiencing. There is no retrospect here. It’s an amazing compilation.
Here’s an excerpt, describing the head counsel for the Justice Department, David Boies, and his plan of attack. This is just one tiny section of Auletta’s huge essay.
Boies, who has thin brown hair and protruding ears, gives an impression of studied casualness. In court, he always wears a navy suit with pants that drape over black sneakers; a blue-and-white pin-striped button-down shirt; a square-bottomed dark-blue knit tie, which dangles above his beltless waist; and a black Timex strapped over his left cuff, so he can easily read the time. The suits, shirts, and ties are purchased in batches from Lands’ End. During the trial, Boies stayed in a modest apartment that the Justice Department rented for him. Despite his casual demeanor, his intensity is such that he routinely walks past associates without noticing them. He has become a celebrity in Washington restaurants, where he picks up thick lamb chops in his hands and chews the bones clean. Sometimes he takes a quick nap in a booth at the Capitol Grill. Playing tennis or Ping-Pong with any of his children – he has six, and has been married three times – he plays to win, as he does at craps or card tables in Las Vegas, which he visits several times each year. “When he plays craps,” Mary Boies, herself an attorney, says of her husband, “he remembers every roll, every sequence.”
Just before ten o’clock on October 19, 1998, the first day of the Microsoft trial, Boies entered the block-long, eight-story E. Barrett Prettyman United States Courthouse, rode the elevator to the second floor, then walked past a line of reporters parked against a mauve marble wall who were vying for the forty daily press seats, past an even longer line of spectators on the opposite wall, and entered Courtoom No. 2, where Judge John J. Sirica had tried the Watergate defendants. The room has no windows, and there is no street noise.
Then the door to the Judge’s private corridor opened and Deputy Marshall R. Kirkland Bowden, who has worked in this court since 1962, called out “All rise!” Judge Thomas Penfield Jackson entered and ascended his platform. Although Jackson, who is now sixty-two, was the first judge appointed by President Reagan to this district court and therefore might be assumed to oppose intrusive government, Microsoft executives have learned to be wary of him. He was the judge who ordered Microsoft to separate Internet Explorer from Windows, and since then he had made a number of preliminary decisions that angered the company, such as allowing unwanted excerpts from Gates’s twenty-hour-long videotaped pretrial deposition to be played in court. Before the trial began, Jackson had announced that it was his intention to speed it along by limiting to twelve the number of witnesses each side could call and by stipulating that all testimony be submitted in written form, so that all cross-examination could occur without delay.
After a flurry of procedural maneuvers and a brief opening by a representative of the states involved, Boies rose and stepped to the microphone on the podium in front of the judge, ready to make the government’s opening argument. Mary Boies looked on from the spectator section. Joel Klein, the bald top of his head bobbing, shifted in the aisle seat of the bench beside the counsel table. The Microsoft counsel, Bill Neukorn, sitting at the head of the Microsoft table, stared straight ahead, his pen and pad poised. Judge Jackson, who has white hair and gold-framed half-glasses, nodded with a welcoming smile to each table of attorneys.
For nearly three years, glancing occasionally at a few noted he had written on a manila folder, Boies described, first in sum mary form and then in chronological order, how, in his view, Microsoft had violated the antitrust laws – in particular, by “restraint of trade or commerce” – and so became a predatory monopoly. Coercion, he claimed, was standard operating procedure at Bill Gates’s Microsoft. Boies then gave a signal and played the first of many excerpts from Gates’s videotaped deposition – an excerpt that gave a portrait of Gates at odds with the decisive, fearless straight shooter of common lore. Shown slouched in a leather chair, and compulsively sipping from a can of Diet Coke, Gates appeared on several court screens:
BOIES: Are you aware of any instances in which representatives of Microsoft have met with competitors in an attempt to allocate markets?
GATES: I am not aware of any such thing, and I know it’s very much against the way we operate ….
BOIES: Now, have you ever read the complaint in this case?
GATES: No ….
BOIES: Do you know whether in the complaint there are allegations concerning a 1995 meeting between Netscape and Microsoft representatives relating to alleged market-division discussions?
GATES: I haven’t read the complaint, so I don’t know for sure. But I think somebody said that that is in there.
More than a few spectators laughed at Gates’s professed ignorance. Boies now paced in front of the bench, a pointer in his hand, and asked an aide to roll the second video. Gates again filled the screen, and, in response to a question from Boies about his understanding of Netscape’s strategy back in mid-1995, Gates said at the time “I had no sense of what Netscape was doing.”
Using his pointer, Boies displayed on the screens various Gates documents, including a May 26, 1995, memo titled “The Internet Tidal Wave,” which showed that Gates quite clearly saw the importance of Netscape. In it he wrote to his managers, “A new competitor ‘born’ on the Internet is Netscape. Their browser is dominant, with 70 percent usage share, allowing them to determine which network extensions will catch on.” With control over how software worked on-line, Gates noted, Netscape could cheapen Windows and “commoditize the underlying operating system,” by which he meant that people using any number of programs, for browsers, for word processing, for spreadsheets, for printers – for all sorts of applications – might begin to move away from Windows.
With a nod from Boies, an E-mail written by Gates five days later and sent to his senior executives appeared on the screens. It said, “I think there is a very powerful deal of some kind we can do with Netscape” – a deal that would reduce competition. “We could even pay them money as part of the deal, buying some piece of them or something.” Then, just a few weeks before the meeting with Netscape – the meeting that Gates said he was not involved in – he wrote, “I would really like to see something like this happen!!”
A division of markets was proposed at the June 21st meeting, Boies argued, producing E-mails from both Netscape and Microsoft. “What you have here is, in and of itself, an attempt at monopolization,” he went on, a “restraint of trade” effort prohibited by law. Why would Netscape feel compelled to cooperate? Because, Boies claimed, Microsoft’s leverage stemmed from Windows, which controlled ninety percent of the P.C. operating-system market (a somewhat inflated number, since it excluded the Macintosh and all other machines not running on Intel-type chips). Any computer manufacturer, or any maker of printers or software-application programs, from spreadsheets to browsers, needed to know Microsoft’s Application Program Interfaces, or A.P.I.s, in order to be able to connect to Windows, Boies said. He charged that Microsoft was predatory because it threatened to crush Netscape if it did not comply. There would be testimony, Boies promised, that one of Gates’s “top lieutenants” threatened to “choke Netscape’s air supply.”
For three crucial months, Boies said, Microsoft had withheld A.P.I.s that Netscape required to be compatible with Windows 95, the latest version of Microsoft’s operating system. Unlike Netscape, which tried to sell its browser, Microsoft adopted what Boies called “a predatory pricing campaign” and gave its browser away, bundling it with Windows. “Our business model works even if all Internet software is free,” Gates told a reporter in an article that Boies cited. Microsoft imposed contracts on computer manufacturers, Boies said – on A.O.L. and on software companies like Intuit – restricting their ability to do business with Netscape.
It’s been a difficult month. And a good month. My mother was here with me for a while, which was awesome. I have been reading a lot, writing a lot, watching a lot of movies, and working hard. The Shuffle is one of those random ongoing things that I like to incorporate into my life, which can be quite rigid in its routines. It’s just the way I’m built. I’m not particularly flexible. Shuffle is a gift, in that regard. I’m quite serious. It allows an element of random-ness into my day. I have to accept what comes. That’s the fun of it. You see, you can take lessons from anything in life, if you’re open to it. I’m trying.
“Evening Is a Little Boy / Night Will Never Stay” – this is from what I like to call Shawn Colvin’s suicidal Christmas album.
“Dive” – Nirvana. Fierce.
“Can’t Help Falling In Love” – Elvis, from the newly released Prince From Another Planet, his Madison Square Garden concerts in 1972. The sound is extraordinary. His final notes: amazing.
“Stuck On You” – Elvis. Elvis of the 1960 period, with the very tall post-Army hair. I know this is just a silly pop song, really, but it’s one of my favorite Elvis-es ever. He’s having a blast.
“The House is Rockin'” – Brian Setzer. Big band sound, with electric guitar. Great.
“Spend Some Time” – Eminem. A bit of a snoozefest, pal.
“Mercy” – Alanis Morissette. I have no idea what is going on here, but I love it.
“If I Loved You” – Elvis goofing around at home, being recorded by his friend Red West. Elvis plays piano here, too. I think this was from when he was in Germany. Elvis sings the HELL out of this song and it makes me wish he had actually recorded it. He could pull it off.
“Skull and Crossbones” – from the insanely hyperkinetic Pirates of the Caribbean soundtrack. SO. DRAMATIC.
“O Holy Night” – from the Glee Christmas album. I am assuming this is Lea Michele. She has a beautiful voice, and I like the arrangement.
“A Hazy Shade of Winter” – Simon & Garfunkel. I’ve always loved this song. I remember jamming out to it when I was a small child, which is a strangely tragic image to me now.
“Second Hand News” – Fleetwood Mac. Bitter bitter bitter. I love the bitterness of the song mixed with the positive non-melancholy melody. It’s vaguely psychotic and I love it.
“First In Line” – Elvis Presley. This is one of the early RCA recordings where, in trying to re-create the distinctive Sun sound, with its slap-back echo, they put an echo on Elvis’ voice so that he sounds like he is singing from the bottom of a well.
“Glass Onion” – The Beatles. I love the self-referential nature of the lyrics.
“I’ll Hold You In My Heart (‘Till I Can Hold You In My Arms)” – Elvis Presley. God, this is so emotional, so good. It’s from the American Studios sessions in the late 60s that yielded such gold. Elvis is in top form here. He’s WAILING, with that rough edge to his voice that I love so much.
“Pity the Child #2” – This is from the live concert of Chess at Albert Hall with Josh Groban, Idina Menzel and others. Adam Pascale sings this song, and I don’t think I had really listened to it before now. It’s a tremendously challenging song, it goes from A to Z, emotionally and vocally. Pascale is PHENOMENAL.
“I’m Alive” – ELO. Classic!!
“Spanish Lesson” – Madonna. This is from her Hard Candy album that I really love. This is one of my favorite tracks.
“Any Time At All” – The Beatles. This is from Hard Day’s Night, I believe, although please, someone correct me if I’m wrong! I love this one.
“Razor” – Foo Fighters. This is live. I am not sure they ever recorded this number in a studio. If they did, I don’t have it. It’s haunting. Not like their other stuff. No lyrics, just guitar. Beautiful and melancholy.
“I Love You Because (alternate take)” – Elvis Presley. He is YOUNG here. Early early Sun, one of the first songs he recorded there. There’s a whole talking section in the middle, which is vaguely ridiculous (he’s too young to have any experiences similar to what he is talking about), but it shows his natural acting chops, I will say that. He keeps it simple. And also just slightly absurd.
“New York Story” – Teddy Goldstein. This song was on a mix tape someone made for me a million years ago and I had completely forgotten about it. In a recent purge in my apartment, I came across said mix tape (which was awesome), and saw the title written out on the little sleeve and thought: “Hm. I have no memory of that, what is that.” I found it on iTunes, and fell in love all over again.
“Kashmir” – Led Zeppelin. This is up there as one of my favorite songs of all time.
“The Nightmare” – orchestra, from the movie Anastasia. I love that score in all its melancholy bombastic Russian-ness.
“Muquin” – Harriet Harris, from the adorable Thoroughly Modern Millie soundtrack. I’m clocking a ukelele in the background. Love it.
“Mother’s Pride” – George Michael. Great album, not a stinker on it. He’s got such an amazing voice.
“Heart of Rome” – Elvis Presley. This was on his country album, and I love it. It’s so dramatic, with a note you think he won’t be able to hit at the end … and then, naturally, he hits it beautifully. Indestructible voice. Freedom, courage, nothing held back, nothing left on the table.
“U.S. Male” – Elvis Presley. The ultimate in Elvis self-parody. There are a couple of different takes, and in each one, he keeps talking as the song fades out, and it’s clearly improvised, and so funny. In this one, he says, “You talkin’ to the U.S. male. The American U.S. male.” Elvis’ sense of humor was goofy, in some respects (he loved water balloon fights and practical jokes, etc.) but on another level it was quite sophisticated and ironic. His favorite movie of all time was Dr. Strangelove. Elvis had a highly developed sense of satire. You can hear it in the blown takes of various songs, and the things that make him roar with laughter. The humor in his clarification that he is an American U.S. male is ironic in nature, and a sort of letting us know that he is in on the joke. What other kind of U.S. male would he be but American? Doesn’t U.S. mean American by default? Elvis is making fun of the kind of macho cock-swinging dumbass that the song portrays. It’s great.
“Highway 57” – the opening number in the Broadway musical Pump Boys and Dinettes. I love this musical so much!
“Season of the Witch” – Donovan. My parents had one of his albums when I was growing up. This song is awesome. It always works for me. Never get sick of it.
“Cathy’s Clown” – The Everly Brothers. They are just perfect. The harmonies!
“Dumb” – Nirvana. The lyrics fucking kill me. “I think I’m dumb. Maybe just happy.” Heartbreaking.
“I Feel Fine” – The Beatles. Brilliant opening.
“My Babe” – Elvis, live in Vegas. Sexy as hell, and a couple of times he goes over the edge (which for Elvis, was pretty damn far out), and he cracks himself up.
“Night Train to Memphis” – Everclear. I love these guys! This is from their album of covers, which includes the theme song to “Land of the Lost”, so naturally it is a great album!!
“Your Love’s Been a Long Time Coming” – Elvis Presley. From the underrated Promised Land album. This is mature sad Elvis. He’s killer.
“Lindbergh Palace Hotel Suite” – Mark Mothersbaugh, from The Royal Tenenbaums. If I am not mistaken, this is also used in the great Canadian TV show Slings and Arrows as one of its themes.
“Old Shep” – Elvis Presley. Oh, Elvis. I know you love this song. It’s okay. He sang it at age 10 at a Tupelo country fair (held here), and came in 5th. He sang it a capella. He adored the song, which tells the song of a little boy and his beloved dog. It’s amazing to me (and cool, although the song is not my favorite) that when he became famous, he would record it. Elvis remembered things. Elvis had great ties with his past. But still. Old Shep, Elvis? Let it go.
“Maybe This Time” – Kristen Chenoweth, from Glee. Woman can sing, no doubt. But I don’t understand her interpretation of this song. She hits a final note that is clearly just a showoff moment for her, and seems completely at odds with the sentiment of the song, which is chastened, hopeful, and tinged with tragedy. It’s like she couldn’t help herself from pulling out the soprano register, it doesn’t fit. I saw Natasha Richardson do this role on Broadway, and it is the most memorable live performance I have ever seen.
“We Are the Champions” – the Glee version of Queen’s classic. It’s actually rather lovely.
“Old Woman From Wexford” – The Clancy Brothers & Tommy Makem. I was wondering when the Irish brigade would show up!
“Lucky” – Britney Spears. This is adorable and I don’t care who hears me say that.
“Summer Kisses, Winter Tears” – Elvis Presley, in an Oriental-inspired number that is completely absurd.
“Unchained Melody” – Charlie Rich. God, he’s good.
“Shake It Out” – from Glee. I have everything put out by Glee. It’s a compulsion. Sometimes they hit it, sometimes they bore me. This is great, though. Beautiful voices.
“Elevator Boogie” – Mabel Scott. I have this great album of old piano boogie-woogie. This stuff is so hot, drenched in sex and fun.
“Cigarettes and Chocolate Milk” – Rufus Wainwright. He’s hit or miss for me, but this song is great.
“Joey’s Arms” – Cliff Eberhardt. I’ve written a bunch about Mr. Cliffhardt before. I can’t imagine my life without his music. I don’t say that about every musician. I love Foo Fighters, but I certainly can imagine my life without them. Cliff Eberhardt was important to me at a very significant time in my life, and his songs were soothing, painful, cathartic, and healing. This man’s been through it. I’ve seen him perform a bunch. He’s fantastic. One of my favorite songwriters.
“Set Fire to the Rain” – Adele. You GO, you fabulous woman.
“Everyday” – the wonderful band Hellogoodbye, on their ukelele album. Yes, they do all this electronic stuff, too, but then they come out with an album of ukelele covers? They sing Buddy Holly? I LOVE THEM.
“Smooth” – Santana & Rob Thomas. I certainly remember the time when this song was everywhere, you could not escape it. Its power lasts, though. It’s a really good song.
“Diamonds Are a Girl’s Best Friend” – Marilyn Monroe. Not only do I love her voice (it’s quite a flexible instrument, and I don’t think she gets enough kudos for her singing), but I love the arrangement here. The big band feel.
“Basket Case” – Green Day. “Do you have the time to listen to me whine?” Actually, no. I’m busy with my own whining.
“Something In the Air” – Thunderclap Newman. Used, memorably, in Easy Rider. I love the song. “And you know that it’s right!”
“Jeremy” – Pearl Jam. The song still has power and relevance.
“Dragon Attack” – Queen. YES. From The Game. Such freakin’ rock stars.
“What” – Brendan Benson. Another one of my favorite songwriters writing today! He seems incapable of writing a bad or boring song.
“It’s a Boy” – The Who. Goosebumps all over my body. Not an inch left uncovered!!
“Minnie and the Moocher” – Cab Calloway. I love his stuff. I have a whole double-album of it.
“Strong Black Vine” – Tori Amos. I know many of her fans love her interior-introverted ballads. I am not as crazy about them. I like it when she gets big, rough, and angry. This is a great example.
“Washing of the Water” – Peter Gabriel. To be honest, this song is too painful for me to listen to.
“Scentless Apprentice” – Nirvana, live in Seattle. Outrageously huge. You can just picture how crazy the crowd must have been. The sound is a giant undulating WALL.
“Paid For Nothing” – Pat McCurdy. I believe this is his first appearance on the Shuffle, which is shocking. This is live, from one of the 350 shows he does in the Midwest every year. Funny lyrics.
“Window” – Fiona Apple. My dad loved her. I love that he loved her.
“Monkberry Moon Delight” – Paul McCartney, from the phenomenal album Ram. I believe this is the first thing he did post-Beatles. A solo album. Not a bad song on it, and “Monkberry Moon Delight” is my favorite track. I love it when Paul screams.
“Everyday is Xmas” – Pat McCurdy. I love this song of his. It’s live, and everyone sings along, as they always do.
“Harlem Pas de Deux” – from the Broadway production of Ragtime. Beautiful. And strangely sad.
“Gay Messiah” – Rufus Wainwright. I get bored with him sometimes. Like now.
“Shake, Rattle and Roll” – Elvis Presley. Lots of takes. The lyrics were seen as two risque for a white boy to sing (racist: it’s okay for blacks to glory in sex, but not whites?) But there are some takes when Elvis sings the dirty lyrics. “You wear them dresses, the sun comes shinin’ through …” Funnily enough, that was seen as too dirty. But somehow no one thought that “I’m like a one-eyed cat peeking in the seafood store” is the dirtiest line in the whole thing. I guess they didn’t understand the imagery, but I don’t know how you could miss it. A one-eyed cat? The seafood store? Come on.
“Spanish Lady” – The Irish Tenors. So ridiculous.
“Skip Rope Song” – The McGarrigle Sisters and Emmylou Harris. Rufus Wainwright’s mother! This is from the wonderful album The McGarrigle Hour. I am so glad that album exists.
“Poison Ivy League” – Elvis Presley, from Roustabout. Dark days for our rebel, Elvis. Where his rebellion is reduced to making fun of Ivy League guys, as opposed to completely destabilizing the ground on which we walk.
“A World Of Our Own” – Elvis Presley, from It Happened at the World’s Fair. Not a stand-out song, but Elvis performs it beautifully. Languidly melodic.
“The Long Black Veil” – Johnny Cash at Folsom Prison. Powerful, and so simple. You can hear a pin drop in that rowdy room of convicts.
“Danny Boy” – The Irish Tenors. You guys again? Relax. You’re all wonderful, stop competing with each other.
“One Hit Wonder” – the great Tracy Bonham, from her great first album The Burdens of Being Upright.
“It’s All Wrong, But It’s All Right” – Dolly Parton. A legend. So homegrown, so American, and yet so universal.
“That Thing You Do” – The Wonders, from the That Thing You Do soundtrack. (Of course, this was all by Mike Viola, one of my favorite songwriters.)
“Hosanna” – from Jesus Christ Superstar. The celebrity is gettin’ to J.C. at this point.
“It’s a Hard Life” – Queen. Who has the balls to open a song the way Mercury/et al opens this song? I mean, let’s not beat around the bush. Let’s jump right into the heart of the moment.
“Up the Ladder to the Roof” – The Nylons. This song, and this group, always makes me think of my friend Brett, who died recently. He loved The Nylons, and introduced me to their music.
“Don’t Say No” – Robbie Williams. Great song. Great pop anthem. He’s so awesome.
“Who’d Have Known” – Lily Allen. This song is so lovely. I realize she’s a bit of a trainwreck. She’s young. This is beautiful. I worked her Today Show segment, when she was first hitting it big.
“Chokin’ the Gopher” – Pat McCurdy. Pat’s gentle loving song about euphemisms for masturbation, male and female. He does not, however, include my favorite euphemism for female masturbation, which would only make sense if you are of a generation that remember rotary phones: “Dialing zero.”
“Jingle Bells” – Bleu. I pretty much said what I need to say about Bleu here. This is from his fantastically entertaining holiday album.
“Somethin’ Stupid” – Robbie Williams. Lovely two-part harmony, with Robbie and Nicole Kidman. This is from his Rat Pack tribute album.
“I Need a Man” – Eurythmics. So do I, girl.
“Trapped Under Ice” – Metallica. My brother says that Metallica is for “metal math nerds”. Their songs are intricate, complex, and highly structured. I love them.
“Higher Ground” – the great cover of the Stevie Wonder song by the Red Hot Chili Peppers. One of those rare instances when the cover is almost (almost) as good as the original.
“When You Say Nothing At All” – Alison Krauss. Her voice soothes the troubled spirit.
“Party” – Elvis Presley. This is the big production number that closes Loving You (1957). It’s one of those great instances when Elvis is totally in the moment – at the same time that he is commenting ON the moment. Not too many artists can pull that off. One or the other of the attitudes tends to take over: either you are totally engrossed, or you are ONLY winking at the audience and commenting on yourself. Elvis does both.
“Two By Two” – hilarious number from The Book of Mormon. So mean, so funny.
“Go or Go Ahead” – Rufus Wainwright. A song that starts slow and on one level, and moves inevitably to a hugely expressive wailing level. I love it.
“You Don’t Know What It’s Like” – Nina Simone. No, I don’t Nina, but you sure let me know what it’s like. She’s so incredible.
“Seether” – Veruca Salt. Boy, this song brings me back.
“Little Sister” – Elvis Presley. Again, with the sex-on-a-stick Elvis. I love this Elvis.
“Tomorrow Is a Long Time” – Elvis Presley covering Bob Dylan. Haunting steel guitar. The song lingers, the song meanders, it’s beautifully modulated, beautifully performed. Dylan loved it.
“Give ‘Em Hell, Kid” – My Chemical Romance. I love them but I always want to tell them to relax, everything’s going to be okay.
“SexyBack” – Justin Timberlake. The song is already a classic. The O’Malley Sisters love JT beyond measure.
“Boyfriend Overture” – the great and swinging overture to the Broadway production of The Boyfriend. Seeing a local production of this when I was 11 or 12 changed my life. 1. It made me interested in the 1920s, an interest that has lasted me my whole life. 2. It made me want to get up on that stage and pretend to be somebody else, preferably a “perfect young lady” ensconced in a boarding school wearing a flapper dress.
“Dream On” – the Glee version, which is pretty damn awesome. It becomes a duet, featuring Neal Patrick Harris, and it works great.
“I Pleaded” – the great Gene Kelly, from Anchors Aweigh (speaking of Dean Stockwell! Anchors Aweigh was his debut!)
“Mothersbaugh’s Canon” – again from Mark Mothersbaugh’s score to Royal Tenenbaums. Beautiful and very sad.
“Could I Fall in Love” – Elvis Presley, from Double Trouble. Lovely, with rare moments of Elvis singing with someone else (he was always a solo artist, almost no duets). But you can definitely hear her the problems with the 60s soundtracks, in terms of the mix: Elvis’ voice is pushed so far out in front of the accompaniment that, frankly, it sounds weird. Elvis hated that sound.
“Dark I Am Yet Lonely” – Sinéad O’Connor. This is from her bizarre double album (which basically features the same songs on both albums). This is beautiful, though.
“Baby What You Want Me To Do” – Elvis Presley, live, in the 1968 NBC special, during the informal jam session section. I wrote about this song here.
“Love In My Heart” – Pat McCurdy. Another live track, with everyone singing along and harmonizing. “I’ve got love in my heart, anger in my pants …” Don’t we all.
“We Are Young” – Fun. I had forgotten I owned this song. Very exciting song!
“Heartache Tonight” – Michael Bublé. He turns it into a big-band number, and I think it’s quite effective.
“Blow Up the Radio” – Bleu. I love it when he writes dance-hits. This is basically a disco song. Donna Summer would’ve loved it.
“Shove” – L7. This is from the Tank Girl soundtrack, which is outstanding. I have some other songs of theirs, and I love the loud grunge sound.
“Sacrifice” – the superb Clint Mansell, in his soundtrack for Moon.
“Symphony No. 6 in F Major, Op. 68 ‘Pastoral'” – The London Symphony Orchestra, playing Beethoven. This sounds like it should accompany a royal pageant!
“Strong” – Robbie Williams. This may be my favorite of his songs. The lyrics kill me and I really click with them. “You think that I’m strong. You’re wrong. You’re wrong.”
“Look Out, Broadway” – poor Elvis Presley, and his co-stars in Frankie and Johnny. Harry Morgan sings along! The image of Elvis – ELVIS – being a Broadway-gypsy-hopeful is absurd.
“Take Me I’m Yours” – Squeeze. Ha. Totally forgot about this song until now!
“Heartbreaker” – Sarah Donner. She’s so good. I will always have her on my radar now.
“If” – Dean Martin. My God, he’s perfect.
“Are You Lonesome Tonight?” – Elvis Presley, in Vegas. He performed this in all of his shows. You never feel he gets tired of it, although he did make fun of it (often).
“Yancey Special” – Jimmy Yancey. Awesome boogie-woogie piano! Roll up the rugs and dance!
“Pride (In the Name of Love” – U2, live in Paris. This is an absolutely electric live album. The crowd is ferocious, so into it (any time Bono speaks a French word, they lose their minds!), and the band sounds great.
“Once Upon a Time” – The Pogues. I love The Pogues, and this is one of my favorites of their songs.
“Little Red Corvette” – Prince. This song took over the airwaves when it was first released for what felt like forever.
“Hound Dog (live)” – Elvis, live in the 70s, I think in Memphis. He starts off by saying, “This was a song I performed on the Ed Sullivan Show in 1912.” They totally rearrange the structure here, slow it down, so that it almost becomes a country song. He can’t stop making fun of it. He just can’t.
“Something’s Got a Hold On Me” – Christina Aguilera, wailing in all of her awesomeness in the wonderful Burlesque album. I recommend the album. Cher sounds amazing, and Aguilera is in fine form.
“Been a Son” – Nirvana, live in Amsterdam. It’s hard to believe how huge their sound is with so few people playing.
“Exit” – U2, again from the Paris live concert. The crowd sounds almost totalitarian: clapping in unison, screaming at the tops of their lungs. It’s exciting.
“How Do You Think I Feel?” – Elvis Presley, from his second album for RCA. I don’t know, Elvis, why don’t you tell me how you feel?
“Fairytale (alternate take 2)” – Elvis Presley. This is a strictly country number, traditional, and maybe not as well known as some of his other country numbers. But I absolutely love him here. I love him when he gets pissed, listen to how he hits the word “bet” – and listen to how it intensifies over the course of the song, getting angrier and angrier: that’s excellent “script analysis” right there: “You used me, you deceived me, and you never seem to need me, but I BET — you won’t forget me when I go!” You’re right, Elvis, we won’t!
John Cassidy is a British-American journalist, who is a staff writer for The New Yorker. I love his stuff, even though he often writes about things that are relevant to me life in only a peripheral way. He also wrote a book I love, called Dot.con: How America Lost Its Mind and Money in the Internet Era (excerpt here, involving Priceline’s IPO). As I talked about yesterday, I had a front row seat to that crazy era. I went through an IPO. I went through the following plunge downwards. It felt historic, AS it was happening. I was just a bit player, but it impacted my life. John Cassidy is excellent on breaking down how all that came about, and the acceleration of mania and speculation, which put the entire culture into La-La Land.
His profile of Alan Greenspan, ‘The Fountainhead’, came out in The New Yorker in April of 2000. The bad bad times were a-comin’. I honestly don’t know that much about Alan Greenspan, and what I do know (at least about his background) is from Cassidy’s essay. Greenspan was a musician, too. He played various instruments. The image of Greenspan going to little poetry-reading evenings at Ayn Rand’s apartment down in Greenwich Village … What? I kinda want to go back in time and crash one of those parties. Clearly that biographical detail fascinated Cassidy too, considering the title he gave the profile.
Greenspan was appointed Federal Reserve Chairman by Reagan and served in that role until he retired in 2006. His tenure was well-covered by the press (to put it mildly), and during the ups and downs of those years, he took on something of an Oracle status. This probably wouldn’t have occurred if we hadn’t experienced a speculative boom, as we did in those days – which certainly lessens people’s capacity to think clearly, or to want to hear the truth. Cassidy’s book is great in pointing out how the media became co-conspirators in the mania: nobody wanted to be “the one” saying, “Uh, guys? Maybe we should calm down. Looks like we’re in a bubble, and we all know how those go.”
I am no expert on Alan Greenspan’s role in all of that, although his image was certainly tarnished by the Internet crash and then the mortgage crisis. But I do remember very well the speech he gave in 1996 when he used the by-now-famous phrase “irrational exuberance”. (A pretty great phrase there, Alan.)
“Clearly, sustained low inflation implies less uncertainty about the future, and lower risk premiums imply higher prices of stocks and other earning assets. We can see that in the inverse relationship exhibited by price/earnings ratios and the rate of inflation in the past. But how do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?”
That is the question, Alan. But one of the things about “bubbles” is that it doesn’t seem like a bubble while you are in it. And that sound of a warning bell was not welcomed, by those who were making tons of money. “Irrational exuberance? What the hell are you talking about?” Hands over ears, lalala, I’m not listening.
Greenspan’s financial policies had a lot to do with creating the conditions that allowed the boom and subsequent crash to happen, but there is also a psychological aspect to finance (perhaps it is the most important aspect) – and controlling the markets is akin to wrestling with a giant anaconda. As more and more of the culture starts participating in and benefiting from what will later be seen as a bubble, the harder and harder it is to put the brakes on.
I highly recommend John Cassidy’s book about all of this! He’s a lovely writer! Books about “speculative bubbles” are one of my sideline interests – and I honestly don’t know how that came about. I guess I am interested in the psychological aspect. It loops in with my ongoing interest in how the brain works, in cults, in brainwashing, in the ability we have to turn our brains off.
Here is an excerpt from Cassidy’s essay on Alan Greenspan.
The Marriner S. Eccles Federal Reserve Board Building, built in 1936, is an austere white marble box extending for an entire city block along Constitution Avenue between Twentieth Street and Twenty-first Street. Visitors pass through security on the C Street side and find themselves in a large open area dominated by Doric columns and a grand marble staircase. At the top of the staircase and through a hallway is the Fed’s inner sanctum: a long corridor lined by governors’ offices and a large, ornate boardroom that was used during the Second World War for the Arcadia Conference, at which Roosevelt and Churchill mapped out the Allied campaign against Hitler.
Eight times a year, the boardroom houses a meeting of the Federal Open Market Committee. (The committee has twelve seats: seven are taken up by Fed governors appointed by the President; the five others rotate among the presidents of the twelve regional Reserve Banks. At the moment, two of the governors’ seats are vacant.) The meetings begin with charts and a presentation by Michael Prell and Karen Johnson, the Fed’s top staff economists. It is one of the Fed’s many peculiarities that these officials are paid substantially more than the Fed chairman. (Prell earns about a hundred and seventy-five thousand dollars a year, Greenspan just over a hundred and forty-one thousand.) After Prell and Johnson, Greenspan goes around the table and asks each committee member for his or her opinion before stating his own. This process is not just ceremonial. There are seventeen people currently eligible to serve on the F.O.M.C., and thirteen have doctorates in economics. Greenspan is the undisputed leader all the same, and the other members are reluctant to vote against him. “He produces consensus in the same way other good leaders do: by listening extremely closely to what others have to say, by synthesizing that very well, and by sensing the broad middle,” Roger Ferguson, the Fed’s vice-chairman, told me. “Also, he clearly has a point of view about the economy. He presents it in speeches. He presents it privately as well.”
The current debate within the F.O.M.C. is not whether to raise interest rates further but by how much. Greenspan, after playing the Randian hero, liberating the forces of Internet capitalism, has now reverted to the more traditional central banker’s role of restraining a rampaging economy. Complicating his thinking is the stock market. In a now famous December, 1996, speech, he posed the question “How do we know when irrational exuberance has unduly escalated asset values?” The query wasn’t purely rhetorical. For the next year or so, Greenspan and his staff studied the question, before concluding that it couldn’t be answered sensibly. With no signposts to guide him, Greenspan decided that the Fed should stand aside and let the stock market find its own level. Whether or not the decision was soundly based – some observers, including me, have argued that it wasn’t – it proved unsustainable. Eventually, the rising stock market revved up the economy to such an extent that Greenspan could sit on his hands no longer.
He is now in the awkward position of arguing, simultaneously, that the Fed needs to restrain the economy; that the economy is zooming mainly because of the rising stock market; and that the Fed is not targeting stock prices. In principle, the three statements might be reconciled – although not easily. In practice, if Greenspan is determined to slow down the economy he will almost certainly have to keep raising interest rates until the stock market cracks (not merely shakes). He still believes it is impossible to determine with certainty when a healthy bull market turns into a speculative bubble, but he has also told colleagues that he now suspects that what is happening on Wall Street has elements of a bubble. He is particularly alarmed by the spread of computer day-trading, which he compares to casino gambling. In lighthearted moments, he has been heard to suggest that all day traders should be forced, before they start trading, to take an examination in which they are asked to identify the products of the companies that they intend to buy and sell.
With the Fed raising interest rates, the big question is whether the bubble will deflate gradually. History doesn’t teach any simple lessons. In 1929 and 1987, Fed interest-rate hikes were followed, at some distance, by stock-market collapses. In Japan a decade ago, the central bank raised interest rates explicitly to burst a speculative bubble. There was no collapse, but a slow, inexorable decline in stock prices ensued. Greenspan is well aware that another stock-market crash is a real possibility, but that threat probably won’t deter him from raising interest rates further if he believes it is necessary. To him, the Fed’s primary duty is to keep the economy on a sustainable course of growth. He also believes that a Wall Street crash would not necessarily be such a bad thing for the economy, as long as the Fed acted wisely in its wake. “Remember the big one-day decline we had back in October 1987?” he asked Lawrence Lindsey. “Its impact on the economy was not all that great. Then, there was the severe decline in stock prices in Japan early in this decade. True, it took growth out of the system, but most of what they have experienced since is the result of an increasingly corrosive nonperforming loan problem. There is no guarantee that even if you get a 1929, you’ll end up with a 1932.”
I follow a group on Facebook called the Irish Photo Archives, which is a goldmine. The other day they posted this loveliness. It makes me happy and excited just looking at it. They’re all just so beautiful.
, edited by David Remnick
