As long as we’re on the subject of Ron Burkle, we might as well note that there’s something not-quite-right about the criticism of the guy leveled by that celebrity-and-media gossip blog called Gawker. More particularly, Gawker has been challenging the notion that Burkle “despises” Jeffrey Epstein, the wealthy money manager indicted earlier this year after police uncovered evidence that he had been getting naked and masturbating while local high school girls manipulated his flesh.
We too had thought the two men were friends. But just because they may have been friends back before Epstein was indicted doesn’t mean they’re friends after. This might be exactly the sort of thing that could make someone go from enjoying someone’s company to despising them. We certainly didn’t have anything against Epstein before the stories came out. So, like, maybe Burkle despises him now. And wouldn’t that kind of be a good thing? We mean, wouldn’t it show a bit of character, a moral compass, that sort of thing?
Archive for November 2006
The notion that California’s Supermarket King Ron Burkle is not a political entrepreneur—someone who has used his connections with politicians to profit—is unsustainable. But, of course, Burkle manages to sustain exactly that notion. The Forbes article that got so much attention from Gawker yesterday (mostly on the question of whether Burkle is or is not friends with Jeffrey Epstein), provides a brilliant little glimpse inside the self-image of Burkle.
The mainstream business press beats up on him, essentially for buying access and influence among politicians and leaders of the pension funds that invest with him.
“I basically became the poster child for the ills of political donations and business. It’s preposterous!” he protests.
Totally preposterous! Except, you know, for this sort of thing:
In the mid-1990s he had contributed money to the campaigns of Governor Gray Davis, San Francisco’s former mayor Willie Brown (his former lawyer) and State Treasurer Philip Angelides, and later Brown and Angelides joined the Calpers board. “How were we supposed to know in the mid-1990s that Willie Brown was going to be on the board of Calpers?” he says. You would never have guessed unless maybe you knew that Willie Brown was about as well-connected as any politician in California’s history.
Oh, and then there’s this:
Yucaipa arranged for Clinton to make a speech at a Teamsters conference in 2003, and later Clinton urged Teamsters President James Hoffa Jr. to trust Burkle and present him with possible deals. Result: This spring Yucaipa paid $100 million to buy a controlling stake in Allied Holdings, a trucking outfit in bankruptcy proceedings. “Clinton got it to the point where Hoffa actually helped us with that deal, something I couldn’t have gotten on my own,” Burkle says.
Ron, Ron, Ron. Look. We know you want people to think you built your fortune on your own, pounded it out on the battlefield of the free-market and all that. But it’s not taking. So we’re going to give you the same advice we gave Aleksey Vayner: Go with what you got. There have been plenty of American fortunes built on political connections. And now you’ve got one of them. If those nasty free-market types want to tease you for it, well just wipe away your tears with your piles of money.
The Rise Of Ron Burkle [Forbes]
This morning the New York Post names the extorted executive as Gary Wandschneider, a divisional vice-president of Pepsi Bottling Co. According to Forbes.com, Gary pulled in nearly $3 million in cash compensation last year and was awarded stock options worth about another $3 million.
Well, that’s somewhat less exciting than the idea that it was the CEO of a major company. But the good news is that thanks to help from our readers, we were on the right track! We had narrowed it down to a handful of companies based in Westchester, including the Pepsi Bottling Co. So good work team!
‘Pop’ Tart Scams Bigwig [New York Post]
Forbes.com Profile: Gary K Wandschneider [Forbes]
[Editors Note: There are problems this morning with loading the blogs at the New York Times this morning. We'll have our down and dirty summary of what's on their business blog later this morning. Watch this space. Still acting buggy, so we're putting this feature aside for the day.]
Sponsored by Bloomberg.com
Boeing Not Afraid to Say ‘Sold Out’ (NYT)
We’ve been commenting a lot lately that everything seems to be going swimmingly for Boeing, almost to the point where things might be looking too good. A run like this seems destined for a stunning reversal of fortune, or at least it would if this were a work of fiction. The Times notes that it’s biggest challenge now is the tragedy of abundance; it’s basically got too many sales to handle, and it risks stumbling if it can take on more than its chew. It recently told Southwest, one of its major customers, that it would not raise an order from 80 planes to 82, because it simply didn’t have the capacity. The firm also knows that orders can fail to materialize, and so there’s a danger in overextending itself, as it did in the mid 90s. Meanwhile, we’ve been noting how just about every airline is shifting orders away from Airbus to Boeing, but the US Air-Delta merger could have the opposite effect. Delta’s a Boeing shop, while US Air has big orders in at Airbus. In fact, Airbus has an investment in US Air, which was made as an incentive to buy Airbus planes. So it’s possible that Boeing could lose some major Delta business. Note: this is why airline mergers are so hard. Think of the added costs, just associated with dealing with multiple airline vendors now.
Hu Tells Bush He’ll Seek Balance in U.S.-China Trade (Bloomberg)
Why do we find it worrying that Chinese President Hu Jintao is pledging to take measures to balance US-China trade. That’s apparently what he promised Bush, during a recent telephone call. What does he mean? Will he promise to make Chinese goods more expensive? Will the Chinese buy plastic toys, cellphones, and sneakers from the US? Sorry, but we don’t make those things. Maybe the newly rich Chinese elites will fly here to get massages, hair frosting, and formica countertops from our creative class. That’d be nice.
Buffett’s Berkshire complies with SEC request (Reuters)
Despite Warren Buffett’s supposed love of plain-folks talk and clear financial reporting, we’ve always found it difficult to delve into Berkshire’s financials. His insistence one solely reporting using GAAP means that there’s not much clarification, or indications about what items are one-time in nature. Of course, he’d scoff at the idea of a one-time expense, but come on, it can be helpful. Apparently, the SEC agrees that the firm to could do a better job opening up, and asked the company to be a bit more forthcoming. Busted.
EMI Says It May Draw Takeover Offer (Dealbook)
The major record labels could be fertile territory for private equity to conquer. For one thing, they’re really not doing very well these days. In part it’s due to changes at the industry, but the management is really stale at them. It’s easy to imagine that with a little bit of work, they could start to right the ship, or at least chart a better course. They’re also, of course, sitting on piles of assets, namely, their extensive music cataloges, much of it is under-monetized, or, perhaps, dribbling out a few sales on iTunes. So it’ll be interesting to see what happens with EMI, which may be in talks with Kravis Kohlberg to go private. Wonder what they’ve got cooked up for the company.
$$$The Donald’s thoughts on ‘naked statues.’ [Trump Blog]
$$$The Donald Jr.’s hair. [Gawker]
$$$The Natty Banker’s Gift Guide for Wall Streeters. [Banker's Ball]
Inexplicably, journalists everywhere covering the business beat have declared today “Wall Street Mental Health Day,” or, rather, “Wall Street: They’re F**cking Nuts! Day.” The Post has a piece on traders who’ve been “traumatized by mass layoffs as electronic trading replaces humans” and are, dun dun DUN, “beginning to seek help from psychologists.” New York’s cover story, “Can’t Get No Satisfaction,” delves into burnout and psychological trauma that can come with taking a job on the Street. Even FHM chimes in, with what appears to be a very well-researched article on a raging endemic over at Merrill wherein analysts are so “psycho”—their words—that they can’t understand the dangers of nailing their therapists, which most of them, to their own detriment, often end up doing. (I kid…maybe). But anyway, the New York piece was the most interesting to us because our old pal Alden Cass grabs the mic and really seems to get to the bottom of things:
…Ask Cass why his clients are burning out, and his answer isn’t any different for a banker than it would be for a public-school teacher; there’s a gulf between what they expected from their jobs and what they got. “I can’t tell you,” he says, “how many people come into my office and ask, ‘How come I have this money and I can’t find happiness?’
So what does he tell them? “That happiness equals reality divided by expectations.”
What else does he tell them?
[What do you tell your patients?]
I teach them “Act as if” tips, which is from the movie Boiler Room. “Always be closing” is a good one, too. A lot of my workshops have Gekko quotes, too. I also like “Don’t get emotional about stocks; it clouds your judgment.”
[The Wall Street Journal dubbed you “The Fraser Crane of Wall Street.” How do you feel about that? Would you rather be Niles?]
No. I’d rather be neither; they’re too touchy-feely. I’d rather be Dr. Phil.
[You have an advice column in Trader Daily. Would you call yourself the “Dear Abby of Trading”?]
No, “The Hitch for Traders.”
Can’t Get No Satisfaction [NYM]
LAID-OFF TRADERS ARE NOW SHRINK RAPT [NY Post]
DealBreaker Interviews: Dr. Alden Cass, Hair Stylist Therapist to the Stars Wall Street-ers
- Use the Bloomberg command
NH BLG_DEALBREAKER <GO>
to access Dealbreaker
