Manhattan’s “girlfriend elite" are in trouble and need a bailout!
Eric Fry, on a visit to Charm City, reports…
Rumor has it that times are tough for Manhattan’s “girlfriend elite.”
Now that investment banking, proprietary trading and various other seven-figure Wall Street professions are losing a digit or two, funding is drying up for high-maintenance, extra-marital relationships.
During the go-go days (and nights) of the late nineties and early aughts, Manhattan’s “kept women” enjoyed 5-star lifestyles. But the disappearance of over-the-top pay packages has crimped the economics of under-the-covers liaisons. As Wall Street’s pampered professionals lose their perks, so do their girlfriends. Many of these privileged ladies must now adjust their lifestyles “down island,” so to speak. The posh, Upper East Side digs of 2007 are yielding to Lower East Side lofts and studios.
Some of these gals are suffering such a severe drop in income and lifestyle that they are starting to resemble, dare I say, prostitutes. It’s humiliating. Sadly, these voiceless victims of the financial crisis possess almost no recourse. Either they accept a cut in pay or choose a new line of work, just like their boyfriends must do. But the transition away from high-priced prostitution to less lucrative lines of work can be very stressful. And it’s not easy for the girls to change their professions either.
Even the fortunate members of the girlfriend elite who have survived this initial wave of layoffs face new stresses. They must now carefully consider the security of their revenue stream, and contemplate a vast new range of potential risks. They must ask themselves, “Does my boyfriend work for one of the big banks or does he work for a hedge fund? If he works for a bank, is the bank receiving TARP funding? If yes, is my boyfriend’s bonus ‘contractually obligated’ or discretionary? If no, can my boyfriend’s bank survive without bailout monies? If my boyfriend works for a hedge fund, is the fund suffering from poor performance in 2008? Or, if the fund’s numbers were good in 2008, were they also real? Who’s auditing this thing anyway? Is the auditing firm reputable or does it operate out of a small, dingy office in Florida?”
Younger members of the girlfriend elite will also want to contemplate long-term economic trends, like the prospective path of the U.S. dollar relative to foreign currencies or gold. There’s almost nothing more tragic than devoting a lifetime to backbreaking labor, only to accumulate savings in a fatally flawed currency. Sure, you get to keep all the memories from a career of faithful service, but what happens to your golden years?
So every highly compensated girlfriend owes it to herself to ask, “Would it be best to save money in dollars or euros or yen…or perhaps something more exotic like Brazilian reals?” After all, this is business.
“According to a survey by Prince & Associates, a Connecticut-based wealth-research firm, the average ‘price’ that men and women demand to marry for money these days is $1.5 million,” reports Robert Frank in a fascinating column for the Wall street Journal entitled, “Marrying for Love…of Money.”
“The survey polled 1,134 people nationwide with incomes ranging between $30,000 to $60,000 (squarely in the median range for nationwide incomes),” Frank continues. “The survey asked: ‘How willing are you to marry an average-looking person that you liked, if they had money?’
“Fully two-thirds of women and half of the men said they were ‘very’ or ‘extremely’ willing to marry for money. The answers varied by age: Women in their 30s were the most likely to say they would marry for money (74%) while men in their 20s were the least likely (41%). The matrimonial price tag varies by gender and age. Asked how much a potential spouse would need to have to be money-marriage material, women in their 20s said $2.5 million.”
Let’s think about this; $2.5 million seems like a lot of money. But it seems like a lot less money if you’re a 20-year old facing a new cycle of hyper-inflation. Therefore, given the crisis of the last 24 months, and the Fed’s inflationary response to that crisis, every forward-looking gold-digger has reason to wonder if $2.5 million is really enough…and whether the dollar is really the best store of value.
And one final note gals; PLEASE know your counterparty! Contracts – both actual and implied – are only as good as your counterparty. Specifically, examine the size of prospective “senior claims,” like the divorce settlement that might ensue from your first chance encounter with Mrs. Investment Banker. Additionally, be certain that your counterparty has not issued multiple, redundant claims on the identical underlying asset.
The “Risk Factors” section of the prospectus may not include all the relevant disclosures.
Well, that does it for today’s discussion of money and sex. But in the column below, Byron King dives into another hot and steamy topic…