Eat the rich: The new City boys we love to hate
Mark is a hedge-fund manager with £30m in the bank and a plan to earn £50m more by 2010. He is also a man facing a mounting tide of resentment, as the world plunges into a recession partly of his own making. Does he care? Of course not. Peter York paints a picture of a monster for our times
Sunday 31 August 2008
You have to have bespoke now. Mark can tell a proper-built suit from 20 yards. Everything hangs and moves differently from a crap ready-made with a fancy brand, produced largely in the Far East and re-badged as European by a bit of finishing in Italy. He knows the business models of the luxury brands. He knows a lot of business models, because he's spent years with their inventors. The trick in our trade, they'll say, is to get the punters doing this or that. Getting them to buy popcorn in cinemas, for instance. Popcorn has a 2,000 per cent margin.
His own get-up today is almost Regency "buck", meaning a new – as opposed to 1980s – double-breasted suit with really narrow trousers from Richard James Bespoke. It works on him because he's fantastically lean and plans to be lean forever. It can be done. His face is wonderfully sharp and his thick hair's cut close-ish (anything gelled or spiked or highlighted or brushed forward Tintin-style, like some middling City types – is just naff).
His leanness is vulpine and distracting to anyone... flabby. When he puts his dramatically lean face up that bit too ' close on the personal-space testometer and asks tough questions such as "How d'you explain the inventory ratios?", normally robust thinkers find their inner-stammerer. He knows about the stare test and wins every time, staring so hard people feel he's doing heart-rate analysis. They'll always drop first.
He finds it oddly exciting that a mass of suburban Mr Blobbys who know absolutely zilch about his world – the "New City" West End world – are starting to blame people like him for practically everything that's wrong in 2008. For the credit-crunch via dodgy derivatives; for the oil and food inflation driven by speculation; for the "shorting" raids on the big banks. The lot. People who couldn't tell a hedge fund from a garden centre at Christmas, who've conflated US and UK, Old and New City are being told in newspaper leaders and illiterate TV investigations that "City boys" – latter-day chancers – have ruined their world and got away with the money. You could expect it from someone such as Will Hutton, but in The Daily Mail? They are calling them cowboys and asking for regulation. There's a part of him that wants to stand on the ramparts and put two fingers up (it's the side that worries his partners). And another part that knows that he and his peers are going to have to pay for a PR charm offensive like the one the private-equity people did last year, showing how they'd grown businesses and employment, putting their senior partners' massive rewards into context. (It'll take some doing; hedge-funds make private-equity sound positively cosy.)
And it's particularly unfair on Mark because although he's been making £4m-5m a year for the past four years – more than the average boring FTSE 100 CEO – his total net worth all-up is nothing – still less than £30m and you need £70m to even get near the Rich List. He could name 50 people straight off who've made much more than him – so far. (The Plan says he gets to £80m by 2010; the recession will help – there's always money to be made in a volatile market.)
The Regency buck suit is for the Christie's Contemporary View, which is packed solid with hedgies and other young money people like him, most of whom work round here, on either side of Piccadilly, in "MStJ" – Mayfair/St James's. They're all on to contemporary art now – it's an important global asset class after all – but he was there 10 years ago and more. You just had to listen to those Sensation people or meet Jay Jopling to know they could sell anything. They could beat most young City recruits, class of '96 like him, for sheer ambition and pretty naked aggression. Wonderful. Now it's moving at three times the speed, with the Chinese and Indian contemporary sales making big numbers and people talking up the Koreans. It's starting to look dangerously over-subscribed. All those Notting Hill American bankers wanting "wall-power" – huge, knock-'em-dead stunners from big branded artists so they can say "it's a Baselitz" or whatever.
All this – the suits, the art, the competition side of Mark's life – is much easier now he's over here in MStJ rather than the City, with its ridiculous 1980s and 1990s box-buildings for ants, all over-scaled atria and stodgy second-rate corporate art collections. Mark still meets people who think the old City is the shark-pool, but he thinks a lot of it's like a glorified back office in Basingstoke compared to Up West, the slice of London where the real skinny sharks work. The bit that's like a tableau straight out of the FT's How to Spend It. Meaning all the alternative asset classes you could want – art, yachts, wine, plus Jermyn Street – all blazing away from an injection of gorgeous new global money. Everyone knows Rollers are German now but – and here he's put that face up worryingly close again – "How many of the old St James's names are Chinese-owned? They don't exactly advertise it, do they?" He knows, of course – he could do Mastermind on global luxury players, their strategies, off-shore vehicles, sourcing policies.
Helping make the market in luxury brands had been a way of mixing business with pleasure back then, when he was still in the City. But those huge dealing rooms that'd once looked so impressive, so filmic and Wall Street-ish when he'd first been in EC2, now looked like doomed factories with bloated, expensive workforces, the kind you'd outsource. You'd get bright, brown kids out there, kids with better degrees and miles hungrier, who'd work for a third of the salaries, on which – he'd seen it in Mumbai and Ho Chi Minh City and all over – they'd run a big house with several servants as against the glorified semis in Wandsworth their overweight Brit counterparts live in. You need more than just a million bonus to get into Phillimore Gardens, Kensington, where houses start at £12m now. And those south London City boys still – in 2008 – want to move to Phillimore Gardens. Dull and over-priced and you're living next to the Globals, people who have to have one of those big Victorian villas, completely gut it to make it like a Dubai hotel and are then there just six weeks a year. You never see anyone on the street.
Mark could write a book on the Globals, more likely run one. (His father actually is a bookie, it's in the blood.) Mark had Gone Global at about 15; Hammersmith and the wannabe/almost Sloane world of a passable direct-grant school was just too small for him. While his friends had West Coast dreams and later Seattle ones, Mark was already leading his teenage Second Life on Wall Street. He'd seen the film how many times and he knew the Gordon Gekko "Greed" speech off by heart. He'd read Bonfire..., of course, and Barbarians at the Gate and everything Michael Lewis ever wrote. It all made London look, to use his dad's expression, pony.
That enthusiasm's as period as a full Duran-nie kit now, and just as embarrassing. Instead, he's been observing the Chinese and the Indians – even the Russians and the Mexicans – for the past 15 years. He got to know them in the 1990s when he was still practically an intern and couldn't do much for them. He'd started to think his beloved Americans were finished. But that out there, in the new worlds, there were those fantastic people who were real wealth-creators and completely unregulated. They lived the life of emperors and they thought really big. They didn't worry about unions or hostile press. (Mark sometimes reads The Guardian to remind himself what he hates.) Those first-generation entrepreneurs often wore the naffest clothes – that whole silk-suit-and-patent-shoes routine, but then the sons and grandsons moved on to Savile Row and the Cap Ferrat style – the Indian MBA Eurotrash look.
Mark's LSE first – better than Oxford for what he wanted – gave him global grasp, and his new Tiger Economy friends, who remembered him for paying them attention when they were down, all worked out. He's your point man for sovereign fund investors, well in with the Gulf towelheads and the great control-freaky Singaporeans. He's got access and trust with the people everyone desperately needs to know now. Everyone. It's fantastic to have some of these old lions in the biggest banks wanting a relatively obscure, thirty-something hedge-funder – not generally on the radar, though better rewarded than them already – to help make the contacts and the case for a capital injection of however many billions. It'll cost them. "The smell of fear," he says to himself – another wonderful corny movie line.
Mark's life has been one long round of obsessional groupiedom followed by contempt. Getting to despise your heroes – starting with the Americans – is one of life's epic pleasures. The same with the famous. You start collecting celebrities because you can. On the New Charity Circuit. Get to know Arpad Busson. Take a table at the Raisa Gorbachev Foundation fundraiser and you can ask who you want. Fantastic women, for a start; taller, better everything and, he's found, startlingly up for it. One's batchelor days can stretch out almost indefinitely with this kind of disposable income. He's helped several well-known actress/models with their finances, not to mention all those meals at Zuma and the Cipriani. A lot of quite famous people, old heroes, scrape by on a couple of hundred thousand a year, less sometimes, and they're grateful for the money if you ask them to speak at client dinners and bonding do's.
And it turns out they often live somewhere terrible, like Muswell Hill or Shepherd's Bush, which makes no sense. Eighty per cent of hedge-funders and 100 per cent of the Euros and Americans live in, ideally, SW3, SW7 (especially the French), SW10 or Notting Hill. Along with the sharp suits, Mark is reckoned a positive maverick for living in SW1 (Eaton Place), which is reckoned a bit "high-profile" and slightly old-flash, but actually cost no more than prime Chelsea when he bought it. And they've got huge rooms with high picture-hanging ceilings. And if it all went completely belly-up tomorrow, he's got £15m clean, legal and tax free in the Switzerland of the East, Singapore, and an investment manager job offer there too from one of those grateful conglomerate granddads with the silk suits and shiny shoes.
946 – billionaires worldwide in 2007, up from 306 in 2000.
£3.2m – average pay of a FTSE100 CEO last year (£737,000 cash, remainder bonuses, pensions, share options)
37% – pay increase for FTSE100 CEOs last year.
4% national average pay increase
£11,195 – income of a worker on the national minimum wage in 2007
130,000 – number of non-doms living in the UK in 2007, up from 64,000 in 2002
916 – super-yacht orders in 2007, up from 241 in 1997
£6,800m – value of private jets purchased in 2005, up from £1,700m in 1995
+1% – average rise in value of properties worth £10m+ last month
-1.6% – average fall of central London properties last month.
- 1 Heavy metal producer's corpse to be mutilated by models as per his dying wish
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
- 3 Nineteen-year-old student left gifts for parents before taking her own life
- 4 Deliberately urinating before sex can increase risk of urinary tract infections
British Muslim leaders outraged after Eric Pickles says followers of Islam should 'prove their identity'
UK terror fears: My jihadist son returned from Syria mentally scarred – now he is being ignored
Nigel Farage: NHS might have to be replaced by private health insurance
Billy Crystal: 'Stop shoving gay sex scenes in my face'
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
David Cameron says anyone criticising Eric Pickles' letter to Muslims 'really has a problem'
iJobs Money & Business
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...
£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...
£45000 - £47000 per annum + bonus + benefits: Ashdown Group: Java Developer / ...
£35000 - £38000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...
Day In a Page
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village