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Segregation once commonplace on Wall Street

By From page C1 | October 23, 2011

I was just reading in the Wall Street Journal about Dennis Kozlowski and how desperately he wanted to be released on parole.

As he looks at the world through a coiled wire fence, he can’t help but think of the irony that his former company, Tyco, made the barbed wire. Kozlowski admits that he feels some sympathy for the Wall Street Occupiers, mentioning that in his last year at the helm, he pulled in $105 million.

Kozlowski, who apparently still owns a large piece of Tyco shares, wants to merge with General Electric when he gets out. That’s a decision that the boards of both companies will have to make, but it’s an interesting idea.

The Tyco story got me think about how many companies have gone bankrupt, merged or just plain been bought out. One is close to home, or office for me. My first credit card was Manufacturers Hanover Trust Company. It had the nickname in New York of “Manny Hanny.” Then, it merged with Chase to become Chase Manhattan, and finally its current incarnation as JP Morgan Chase, which itself has become the biggest bank in the country measured by assets.

My first brokerage job was for a Wall Street-based firm called Shearson, Hammill, from where, in 1972 or 1973, I went to Loeb Rhodes, which shortly thereafter merged with Shearson to become Shearson, Loeb Rhodes. These firms have been swallowed up by bigger fish, and then a whale.

During the summer in two of my high school years I had worked for Bache and Company. I can’t think of what that rhymes with, but four years into the business in San Francisco I went back to work at Bache. That company by then had merged with Prudential Securities to become Prudential Bache.

At that point it became the first large firm that had Jews and gentiles as senior partners. Until then, Wall Street was tightly restricted on a religious basis. One of the exceptions was a gentleman who, back in my summer internship days in the Bache mutual funds, was pointed out to me with a tap on the shoulder by an older gentlemen who wanted to know if George Meyer, my boss, was around.

I was almost rude when I said “He’s at lunch. Can I tell him whom to call?” The answer shocked me. “James Roosevelt. He has the number.”

He was one of the first Christians to work for a previously all-Jewish firm. I got to tell the story for the next 50 years. The reason for the segregation was that German Jews came over here before Russian or Polish Jews, and since the Germans, back home in Europe, at least, didn’t mix with Slavic Jews, the same tradition “applied” here. The segregation, which is what it amounted to, lasted more than 100 years.

There are now, by the way, a few black firms, specializing in municipal finance.

Often as not, though, an already-integrated firm will hire three or four black investment bankers to specialize in companies headed by black CEOs. All this time the number of firms was getting smaller and smaller. Look at what just happened to Merrill Lynch when it got swallowed up by Bank of America. Sad, because B of A had the distinction of being the first major firm run by Italian-Americans in the country.

Bud Stevenson, a stockbroker, lives in Fairfield. Reach him at [email protected]

Bud Stevenson

Bud Stevenson


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