BY Michael Mandelkern
Two years later many people still have trouble understanding what sparked the financial crisis that brought the stock market to its knees. But tour guides for the Wall Street Experience mix history and personal experience to give visitors their best explanation.
A couple months ago, Tom Comerford quit his job as a presentation graphics consultant at Goldman Sachs that he held since 2000 after he became involved with the Wall Street Experience. According to Comerford, Sachs found the tours to be slanderous and pressured him to stop. He also said Sachs cut his hours. This fact, however, makes him more than qualified for his new job.
Last Friday, he was leading a group of tourists from Australia, England and Canada on a tour through the Financial District. The two-hour “Financial Crisis Tour” began directly across the street from the New York Stock Exchange with a wide view of what Comerford referred to as the financial capital of the world.
“Everything came through my hands,” he said.
As the group approached the prominent American flag that highlights the NYSE he took out a collateralized debt obligation document with a seemingly safe triple-A rating. But he proved that the mortgages and loans were “crap” with a deceptively alluring outer layer. Investors funneled trillions of dollars into these toxic assets.
“This is legalized gambling,” he told the group.
He then warned the group of the “skyscraper trade” model, when a developer tries to build the tallest skyscraper in the world but needs massive bank loans to finance the project, an early “sign of a bubble” that could result in loan defaults and inflation.
Comeford then directed his concern to the approximate $185 billion the United States financed to bail out AIG. He opined on the media’s past focus on the comparably small $185 million in retention bonuses AIG executives received.
“Nobody knows what’s happening…they had bad investments [sub-prime mortgages] tied up everywhere,” said Comerford in reference to where the $185 billion went. “That’s what I’d like to know.”
Comerford faulted the S&P 500 for assigning bad assets triple-A ratings. And he claimed SEC watchdogs merely “policed their friends” because they sought jobs in the same institutions they were overseeing.
“There’s a lot of blame to go around,” he said.
The group then took a turn to Goldman Sachs’ headquarters, where some of his ex-co workers took “fifteen minute power naps” during sixteen-hour workdays. He denied that his tours unfairly target Goldman Sachs or other financial giants, but rather tell the truth about what happened.
Near the end of the tour Comerford took his group into Trinity Church’s graveyard to pay tribute to those he regarded as historical economic geniuses.
He pointed out the grave of Robert Fulton, an 18th-century born engineer and inventor who “revolutionized how trade was done” by creating the steamboat. Comerford also paid homage to Alexander Hamilton, the first U.S. Secretary of the Treasury, for persuading Thomas Jefferson to purchase New York’s debt in the late 1700s.
Comerford concluded the tour at the Federal Reserve Bank of New York, home of ten percent of the world’s gold. Comerford directed the group’s attention to an octagon-shaped room atop the building that symbolized the height of the financial crisis in September 2008.
Hank Paulson, U.S. Secretary of the Treasury at the time, and Timothy Geithner, then president of the Federal Reserve Bank of New York, met with investors in a panic over the collapse of Lehman Brothers but “couldn’t come to a deal,” said Comerford. The government and investors played a game of hot potato over who should bail out the global financial services firm that ultimately declared Chapter 11 bankruptcy.
“It was financial Armageddon,” said Comerford. “History continues to repeat itself. [Capitalism] is flawed.”
Andrew Luan, founder of The Wall Street Experience, used to give tours to “friends who visited Wall Street.”
“It was natural for me,” he said.
Most participants are tourists, half of them from outside of the United States. And with favorable reviews from the New York Times, BBC and other major media outlets the “word’s starting to spread,” said Luan, who will be featured in the “Wall Street 2” DVD when it’s released.
Luan said the tours “give people a sense of Wall Street” and even trading advice from tour guides who have “seen day in and day out how these people are” while other companies focus primarily on history as opposed to current financial events.
“What happened could happen again,” said Luan. “People don’t understand Wall Street clearly. Our guides are able to answer those questions.”
Those interested in going on a tour with The Wall Street Experience can visit www.thewallstreeteperience.com, call 917.868.7009 or send an e-mail to info@thewallstreetexperience.com.
