Home Radio Segments Guest Segments How Silicon Valley’s Bad Behavior Compares To 80’s Wall Street: Part I

How Silicon Valley’s Bad Behavior Compares To 80’s Wall Street: Part I

Turney Duff, Silicon Valley

With Turney Duff, Author of The Buy Side: A Wall Street Trader’s Tale of Spectacular Excess, Contributor to Showtime’s Billions and CNBC’s The Filthy Rich Guide

A recent book by Emily Chang, Brotopia: Breaking Up the Boys’ Club of Silicon Valley, describes the secretive, bacchanalian underground party scene that takes place at epic mansions in San Francisco, Atherton, Napa Valley, and beachfront property in Malibu. The book reminded Steve of similar excesses on Wall Street in the 1980s, so he invited Turney Duff to talk about that.  Turney chronicled his own spectacular rise and fall on Wall Street in the book, The Buy Side, and is a consultant on Billions, a TV series starring Damian Lewis and Paul Giamatti.

Wild Parties Follow Money And Power

Turney sees strong parallels between Silicon Valley excesses and Wall Street in the 1980s.  He notes that a lot of deviant people went to Wall Street in the 80s and 90s, and today’s deviants appear to be flocking to Silicon Valley—following the trail of tremendous amounts of money and power, which perhaps brings out their hedonistic desires and character flaws.

Speed Bump World

Turney notes that revelations of Silicon Valley excess are minor speed bumps that clean-up the party scene and do not really take away from the work being done by plenty of highly successful and upright people who aren’t a part of these excesses, so one can’t paint everyone in Silicon Valley or on Wall Street with this broad brush.

Steve half-jokingly says we all appear to be living in a speed-bump world nowadays, with scandals galore almost every day.

While Wall Street has fallen from its long-held #1 position on the list of villains, it’s still filled with excess and bad behavior that led to excessive mortgage lending and the financial collapse of 2007.

Tables Turned

Turney also points to a reversal in roles.  Back in the 1980s, Wall Street was vilified by the media and politicians.  Now, ironically, prominent pundits in the media and politics appear to be wrapped up in scandals around sexual harassment, lying under oath, and grossly misappropriating government funds for lavish personal spending.

Steve takes a break and continues his conversation with Turney Duff on Silicon Valley excesses in the next segment where they talk about the implications of such excesses for the people involved and the industry as a whole.

Click here for Part II

Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions.  Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances.  The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by United Capital.

Read The Entire Transcript Here

Steve Pomeranz: New revelations have appeared in the media recently based on a soon to be released book by Emily Chang entitled Brotopia: Breaking up the Boys’ Club in Silicon Valley. As I read the article surrounding these goings on and excesses of many of the power players in Silicon Valley, what immediately came to mind was its similarity to Wall Street during the 1980s. And who better to trudge through this swamp other than Turney Duff? Turney was a part of the Wall Street excesses himself, where he chronicled the spectacular rise and fall of his own career on Wall Street in the book, The Buy Side, which we’ve talked to him about before. He was also a consultant on the show Billions, starring Damian Lewis and Paul Giamatti. Let’s see what he has to say about it all. Hey, Turney, welcome to the show.

Turney Duff: Thank you, how’re you doing?

Steve Pomeranz: I’m doing good. So I know we’ve discussed this off-air, trying to get a handle on all this. Let me set up the scene, as described in the book and excerpted in the magazine Vanity Fair. So, there is a secretive underground party scene taking place in epic mansions on San Francisco’s Pacific Heights and in the foothills of Atherton and Hillsborough.

Or you just have to drive up to nearby Napa Valley or drive down to the beachfront property in Malibu to see what’s going on here. Now, the nature of these parties is not for publication on a show like this, but I think we all know what we’re referring to—“wink, wink”. Romanesque and Grecian affairs of this nature are well-documented in the classical literature. And I think you can take these ideas and update them with modern memes of drugs and far out high tech creativity, and I think you’ll get the idea. So, Turney, talking about these kinds of situations, did you see a parallel to Wall Street in the 1980s you were involved with?

Turney Duff: 100%, the similarities are very striking. I mean, so much so that it makes you kind of wonder if this is just human nature and the nature of the beast. I mean, it can’t just be a coincidence that all the deviant people went to Wall Street in the 80s and 90s, and now all the deviant people are going to Silicon Valley.

Steve Pomeranz: Yeah, so this is a result of youth and tremendous amounts of money and tremendous amounts of power being concentrated in this area. And it’s similar to Wall Street, and it brings out maybe the people’s nature.

Turney Duff: Yeah, I mean, money and power really sort of exacerbate or highlight whether we want to call them character defects or desires or hedonism, whatever you want to call it. But when you have endless money, you can make almost anything happen and oftentimes it does, and again I’m sure, just like Wall Street, it’s not everyone, right? I mean, there are plenty of extremely successful people on Wall Street and in Silicon Valley who don’t cheat on their wives or don’t cheat on their husbands, help their kids with their homework, and on the weekends are helping out at the local church, right? But there are definitely plenty of people who are partaking in the excesses also.

Steve Pomeranz: Well, the money brings options. I mean, if you’re making the average wage and you’re supporting a family, you really don’t have the money…you may want to do these things, but you really don’t have the money to do them per se, especially not to this degree.

So, the money, maybe it breaks down the moral fiber, or maybe it just allows the lack of moral fiber to be on display by itself. But I think that the point here is that Wall Street was a big stage, and now Silicon Valley is a big stage, it’s the biggest stage. And so now it’s under a microscope. What do you think is going to happen now with these revelations and compared to your experience on Wall Street?

Turney Duff: I mean, it probably is going to be a speed bump, probably nothing more. I look at Wall Street today because I still have plenty of friends who are in the game. And due to some of my writing, I’m constantly contacting them and 100%, it’s been cleaned up. But there is definitely still some of this kind of activity happening, sort of off-grid, I would say. It’s not in the open as it used to be. So, for Silicon Valley, there will probably be some people made example of and things will need to be cleaned up, but it’s probably not going away.

Steve Pomeranz: You said that it’s going to be a speed bump. It occurs to me that it seems to me we live in a speed bump world. [LAUGH] No matter, right?

Turney Duff: Yeah, 100%.

Steve Pomeranz: Yeah.

Turney Duff: I mean, my head spins watching CNN every night, because I’m like, wait a minute, aren’t we seven scandals?
Everything seems like speed bump. It’s a different world we’re living in.

Steve Pomeranz: Yeah, nothing seems to stick. Nothing seems to matter. They used to say Reagan was the Teflon president.

Turney Duff: Right.

Steve Pomeranz: And that seems to be happening. But again-

Turney Duff: But also, I would say to you, maybe you have a different opinion, but right now, if you’re going to list ten villains, right, where’s Wall Street? Maybe number seven. And we were number one forever. And so, yeah, we got slapped on the wrist, and there were a few years of needing to be on double-secret probation, but nothing changed.

Steve Pomeranz: Nothing changed on Wall Street?

Turney Duff: No, I mean, especially with all the negative headlines with, if you want to talk about 2009, first with the finance collapse, and then all the insider trading, of course, more regulation came in, and people were trying to clean it up a little bit. But it’s still filled with excess and deviant behavior.

Steve Pomeranz: Yeah, so Wall Street was vilified with bad, negative headlines, and the two biggest critics back then were the media and the politicians. Now what would you say about the media and the politicians today as to where their standing is?

Turney Duff: I mean, it’s very ironic, right? The people who were slinging the most mud were DC and the media. And you would have thought that they were all Girl Scouts and Boy Scouts and that Wall Street was the root of all evil. And now you open the paper, and it’s another media pundit wrapped up in some scandal or no one believes them, and they’re all evil and Washington, DC is filled with sexual harassment and lies. Look at all of the people who have gotten in trouble so far, and I’m not making this political, but you’ve got people misappropriating money flying on private jets. That sounds very familiar, right? And you’ve got men sort of treating women a certain way, and there’s sexual harassment, that sounds very familiar too. And you have all these side deals; Wall Street created that. So, I just feel it’s very ironic that everyone’s kind of getting their turn.

Steve Pomeranz: We’re going to be back with Turney Duff in a moment. Turney had chronicled his own spectacular rise and fall of his career on Wall Street in the book, The Buy Side. We’re talking about Silicon Valley and the parallels, and we’re going to get into some of the details of what these events, these parties are like. Not the lower details, but what it means to the players and prospects for their own careers as well. We’ll be right back.

Click here for Part II