I chanced upon this New York Times article today. Turns out a top Bear Stearns executive, Warren Spector, was ousted due to the subprime mortgage mess and the collapse of two major Bear Stearns hedge funds. That name was familiar to me. When… where…? Suddenly I remembered.
The year was 1979 and I was playing in an intramural bridge tournament. One of my opponents was the very same Warren Spector, a former “King of Bridge” (a high school player with the most yearly “Master Points”.) At this point we were both classmates at Princeton, but as I read in some other Internet bio article, he recently donated so much money to St John College (Annapolis MD) they built a dorm in his name. He must have transferred there, since he graduated in 1981.
I am “declarer” in the hand and I start running my trumps in desperation. Spector makes what seems to me to be a terrible discard, letting me take the rest of the tricks when he threw away an honor card. He mutters, “You just executed a guard squeeze and didn’t even know it!” He gave the impression of haughty imperiousness. But he was right. I didn’t know a guard squeeze (a complicated bridge ‘endgame’ maneuver) from shinola; I was just running my trumps and from my perspective, he had made an elementary blunder. This is a typical injustice of strategic games; it happens in chess too. An opponent stumbles into a resource that draws or wins for him, having seen nothing.
Returning to the impression of imperiousness, that’s what they said in the Bear Stearns ouster article too! “Mr. Spector is a cool, aloof man who has the casual confidence of one who achieved significant professional success at a young age.” They say also, “[he is] a smooth and at times imperious man with a wide-ranging intellect.” A leopard does not change his spots, but he acquires plenty of them! Witness this mind-boggling Spector compensation report from the Forbes bio sheet:
Cash Compensation (FY November 2006) Salary $250,000 Bonus $16,194,430 Latest FY other long-term comp. $18,847,625 Total CASH $35,292,055 Stock Options (FY November 2006) Number of options Market value unexercised 510,607 $46,257,839 unexercisable 247,372 $9,892,364 Total OPTIONS 757,979 $56,150,203
Not a bad combined compensation package for this imperious card player. There was a strange (or maybe not so strange, a good example of narrow-focused nepotism?) bridge link amongst all the top Bear Stearns executives: “Ace” Greenberg, the CEO Jimmy Cayne, and Spector are all very good players. An analogy in a game more familiar to us would be GM Patrick Wolff working for Clarium Capital, an investment fund captained by a chess player, Peter Thiel, the famous founder of PayPal. Another one is the famous surge by Bankers Trust into chess in the early 1990s that hired Norman Weinstein and Max Dlugy as traders. Let’s hope the chess connection trumps (get it? hahaha) the “deck of cards” which might “topple” at any time. Abusing a tired metaphor!
Conclusion? There might be more lucrative things to do than chess or bridge. Still doubting? Ask Stephen Feinberg, another classmate at Princeton! If memory serves, he was either a high expert or low master at his USCF peak. His investment fund Cerberus is always in the news, gobbling up companies left and right.
MG Addendum 6/29/08: Currently Cerberus LLC is running Chrysler (a car company) into the ground. Poor Chrysler is not long for this world.
In a weird coincidence, both he and I worked at some point for the toppled titan Drexel Burnham Lambert (felled by the misdeeds of junk bond king Michael Milkin). Stephen’s compensation is not public but estimated to be at least $50M/year. Do you think Feinberg and perhaps the newly “disgraced” Spector might be convinced to run a chess tournament? The “intensely private” Feinberg might cough up a few bucks (as might Spector) if we name it after them. Note: there’s something to be said for running PRIVATE companies. No embarrassing inspection of one’s net worth on public web pages.
So we reach the Caissic Crisis: who will approach this titanic duo to organize the first $10 million Open prize fund tournament? All the spokesperson needs to do beforehand is think of how it benefits the interests of Spector and Feinberg. There has to be an angle! Maybe play the Princeton card. Or we could play the Harley card. Both Stephen and I enjoy riding Fat Boys, Sportsters, Dyna Glides, what have you.