Everyone has some stories to share about how the current economic meltdown is touching them or the people they know. Here are two of mine.
Mary-Jo and I are planning a trip to Disney World in Florida with our grandkids in April. We'll be traveling during Easter Week, which is traditionally the busiest (and most profitable) week of the entire year for Disney.
Last week, I called to make a couple of dinner reservations at Epcot. The service agent was very helpful and explained that I had actually called several days too early. "We accept reservations at most of our restaurants starting 90 days in advance," she said, "so you need to call back next week."
I thanked her and was ready to hang up when she added, "But you could make a reservation for Cinderella's Table if you like. We take those up to 180 days in advance."
I was stunned. Cinderella's Table is the faux medieval "banquet hall" inside the iconic castle that is the visual focal point of the Magic Kingdom. It is the sine qua non of Disney dining--so much so that the Insider's Guide to Disney World, the brilliant guidebook we've relied on when planning all of our Disney trips, devotes several pages to the elaborate strategy required to bag a reservation there. (You're advised to call starting at 9 a.m. precisely 180 days before the date you plan to dine, to use speed dial to get past the inevitable busy signals, and to be prepared to talk really fast--"Ineedbreakfastfor4atCindy'sonthethirteenthatninethirty"--lest you lose your slot to a caller on another line.) Under normal circumstances, controlling the Cinderella's Table franchise gives Disney a license to print money.
I hadn't even bothered to ask about Cinderella's Table because I assumed it would be fully booked--Easter Week of all weeks. I said as much to the agent.
"No," she said, "we're not fully booked. In fact we have openings all that week." I reserved a table for lunch. If the Great Recession keeps up, maybe David Chang will be calling and begging me to accept a couple of seats for dinner at Momofuku Ko.
My second story is a Bernie Madoff tale from one of the three acquaintances I know who were formerly investors with him. Two of the three lost big sums in Madoff's alleged Ponzi scheme, but the third (I'll call him S.) withdrew his money well before the collapse.
"I'd invested in Madoff through a financial advisor," S. told me, "and the returns were very good. But I like to understand how my investments work, and the more I read about Madoff's supposed strategy, the less sense it made to me. So I finally told my advisor to move my money elsewhere, and he did. This was about seven years ago."
A few months later, S. and his advisor were having breakfast and reviewing his portfolio. "By the way," the advisor commented, "I never told you this, but those Madoff people really raked me over the coals."
"What do you mean?" S. asked.
"I mean that when I called to withdraw your money, the guy on the line--not Bernie Madoff, one of his staffers--started cursing me out. 'We delivered the returns we promised, and now you're pulling your f*cking money?! How the f*ck can you do this to us? You goddam motherf*cker,' and so on. He went on like that for ten minutes."
As you can imagine, S. was shocked. This is not how investment professionals are supposed to act when you withdraw your money from your account.
"At the time," S. told me, "I had no idea what that was all about. Now it makes sense."
My friend's story may not be admissable in a court of law, but if other investors come forward with similar tales, it'll certainly support the notion that Bernie Madoff wasn't the only person at his firm who had some inkling that the whole grand edifice was really just a house of cards. Interesting times we live in.
