When Markets Are Low, Some Get High
January 14, 2008
Back when Gordon Gekko pronounced greed good, some of the side effects of the pursuit of success and riches on Wall Street—the heavy drinking and drug abuse—appeared to afflict the investment banking community like a rogue case of chicken pox at a summer camp.
And, apparently, a cure has yet to be found. According to a recent cover story by Bank Loan Report sister publication Investment Dealer’s Digest, the combination of the Street’s lucrative salaries, the required relationship building (often done in bars), and long hours can up the risk of getting into trouble with narcotics—particularly prescription drugs—and alcohol.
One element of the story that I found especially relevant in the current market is that lousy times can often exacerbate problems.
The story quotes Dr. Alden Cass, president of Catalyst Strategies Group, who says Wall Street types share a common attribute, which can contribute to addiction. “These people tend to be very self-critical,” Cass said. “They’re definitely driven and ambitious, but also harshly self-critical. They can be perfectionists, and when their expectations don’t meet up with the reality, it can set them up for a crash.”
In other words, a downturn in the markets can be a powerful driver of abuse.
Of course, again, it is likely the overall demands of the job that contribute most to the high levels of drug and alcohol use seen on the Street. Not that individuals shouldn’t be responsible for their own behavior. They should. Still, when an employer basically says, “Here’s a credit card; I want you to be at Harry’s (restaurant and bar) three nights a week,” as one former senior VP described his introduction to life at a bulge-bracket bank, the employer should take some responsibility in helping the employee recover.
According to Cass, who works closely with senior level executives on Wall Street, the banks aren’t necessarily doing a better job of preventing substance abuse, but they are more accepting of it as a legitimate problem to be dealt with. And he says there is less paranoia nowadays among his clients to take advantage of the employee assistance programs.
One thing’s for sure, in 1988 or 2008, the story certainly resonates. The folks over at The New York Times’s DealBook page picked up on it, and it has become one of the most avidly read stories on IDD’s Web site. —CJC
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