Let frivolous fashion defy the NY blues

New York Fashion Week is here – and, as Lela Rose, the Texan designer, says as she threads her needle and fits her models, “the show must go on.” “We need a little pick-me-up,” she emailed me, “and I actually think the upcoming week should be a way to move forward. That doesn’t mean we aren’t all facing reduced orders.”

Fashion week is an apt metaphor for what we are all doing: namely, getting on with our lives, still enjoying the “pick-me-ups” like lunches or dinners with friends, but in a different way from before. Friends email to ask me to lunch, but as we make the arrangements I’ve noticed we establish two or three weeks ahead of the engagement both who will be paying and where the venue will be. The unspoken reason for the latter is that there will an inbuilt cost for the person who has to travel.

Then there’s travel itself. It isn’t just Ken Lewis, chief executive of Bank of America, who finds it now takes him eight hours to get to congressional hearings in Washington rather than hopping on the corporate jet as he used to before we made him sell it. The rest of us now find when we travel we stay with friends, rather than in hotels, and we all fly economy, not business.

Of course, it’s necessary financially, but I do wonder if the result is really worth it. I discovered many years ago that if I had to step off a plane having missed a night’s sleep I was pretty hopeless at being productive. So I couldn’t help agreeing with New York Mayor Mike Bloomberg when he proclaimed that a journey of eight hours “was a hardly a good use of the CEO of Bank of America’s time.” Mayor Bloomberg added: “We’ve gotten so skittish about some of these things. The populist attitude of ‘Let’s go and cut out any frivolity’ just doesn’t make sense.”

He has a point. I’m all for regulating Wall Street and trimming the fat cats whose excesses led us down the path of destruction but let’s at least keep some perspective, and, above all, our humour and joy.

Lela Rose agrees, aesthetically, at least. She’s promised me she’ll show “jewel tones and really beautiful color, even a purple floral trench not sad, depressing clothes.” After all, no one ever suggested that fashion needed to reflect reality. V

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Bad times bring out the best in Manhattan

Another day, another one bites the dust. Friends everywhere are losing their jobs.

They’re bright. The New York Times described the growing ranks of the city’s unemployed as the new chic club in town. In part, this is because the people who are losing their jobs are the best and ergo the most expensive talent around. I have been bewildered to see some of the cleverest people I know go down, while five goons get left sitting in their office chairs.

They’re also mostly male. A study last week claimed that one result of the massive job cuts was that for the first time ever, women are poised to surpass men on America’s payrolls: 82 per cent of the cuts have been men.

For those left in work, the cuts seem illogical. A really busy, productive photographer friend tells me he got an email from a bureaucrat’s young female assistant asking him to account for every paper clip, pencil and battery in his desk — with suggestions of cheaper places to buy them. Why, thought my friend, didn’t they just cut the cost of the assistant, if she had time on her hands to add up how many paper clips he was using?

But cost-cutting bureaucrats are not thinking in these panic-stricken times. In one large media company the interns — rich 21-year-old inheritors with zero experience — have taken over.

Fortunately some managements have not entirely lost their heads. At JP Morgan Chase, associates are being promoted to vice presidents — but without any pay rise. The promotion is a signal you’re wanted to stay on. The signal that you’re not is what’s called a “message bonus” — that is, a bonus of zero.

Meanwhile, various IT companies and hedge funds have told employees to make a collective decision: take a pay cut or some of you will be fired. Hearteningly, people are taking the pay cut.

And that’s the interesting thing about these times: we see who people really are. For the most part, the collective anxiety has brought out the best in people. I’ve never been prouder of the friends who’ve stoically accepted the axe but have kept their ideas flowing and their sense of humor — even as they hunt for work in places where the sign “nothing available” hangs metaphorically above the door. V

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Cloud-cuckoo-land on Wall Street

“How much should a Wall Street CEO get paid?” The question got bandied around on Thursday night at dinner — by a bunch of Wall Street CEOs.

The question was the topic of the day following coverage of the extravagant ways of John Thain, former CEO of Merrill Lynch, who spent $1.2 million on his office furnishings: $28,000 on curtains, $10,967 on a lampshade, $1,400 for a waste-paper bin, $88,000 for a rug and so on. Media speculation centered on a $35,000 commode — until it was pointed out that the commode was a cupboard.

Still, people were furious with Thain, who had sold Merrill to Bank of America in September without telling BoA’s chief Ken Lewis about nearly $15 billion of losses on his balance sheet or that he planned to push through billions in bonuses to his Merrill staff, unusually — ergo surreptitiously — before the end of the year. All this was to be paid for, in part, by the government bail-out money given to the merged bank. In retrospect, no wonder that a few months ago he was the only CEO on Wall Street with the gall to ask for a $10 million bonus at a time when the government was dolling out survival packages.

The man is clearly completely oblivious of the times. He needs to rewind Obama’s inauguration address and listen over and over to the part about greed and excess.

Thain’s extravagance has not only cost jobs but poor Lewis has had to go back to the Treasury, cap in hand, to beg for more taxpayers’ money — $138 billion, to be precise.

So when the CEOs at dinner started knocking around speculative figures and one ventured: “$15 million maybe?” I decided to speak up on behalf of taxpayers, now bank owners.

“You guys are speaking vernacular that is PS [pre-socialization]. You have to stop. Let’s assume you don’t pay yourselves anything until you actually start making profits that pay me back — the person who has subsidised your $80,000 carpet.” There was silence and head-scratching and muttering that maybe I was right.

And since we are talking about $80,000 carpets I have a new idea for anyone who runs a bank or firm subsidized by government money. Office photos should be mandatory and publicly displayed so we can be sure our taxes aren’t subsidizing photo-shoots for interior decor magazines. V

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Let’s Hear From The Madoff Women

Every day turns up an astonishing new detail of the incredible story of Bernie Madoff and his $50-billion Ponzi scheme: aside from Obama’s inauguration, New York can talk of little else. And some of the new angles are very odd.

It’s just been reported that Bernie’s late mother, Sylvia, herself had stock-trading troubles. In 1963 the Securities and Exchange Commission began a probe of broker dealers, including Sylvia, who had had her husband, Ralph’s business transferred to her, possibly because the couple was in financial trouble. Sylvia helped her husband out – at great risk to herself. The case was later dropped.

Then it turns out that 17 years ago, the SEC investigated a friend and feeder to Madoff, accountant Frank Avellino. The SEC believed Avellino was running a Ponzi scheme. He told investigators that most of his returns were being generated by Madoff. But the SEC checked Madoff’s books and could see nothing wrong.

Now it emerges Avellino has kept funnelling funds to Madoff all these years. His housekeeper is suing him for taking $200,000 of her money to invest (with Madoff) and then losing it. One thread in all this leaps out at me: the important role of women in this saga – and not just Sylvia Madoff.

Avellino met Madoff through Madoff’s father-in-law, Saul Alpern. The role of Ruth Madoff, a glossy blonde, has as yet gone unreported. But do we really believe Ruth knew nothing of her husband’s business? The couple spent an unusual amount of time together – just the two of them.

Then there’s Madoff’s sister, forced to move from her Florida home, so I am told, because of threats. Her son worked for Madoff. I know of at least one instance where a feeder fund was led by men who got to know Madoff through one of their wives.

Meanwhile Madoff’s son, Andrew, had divorce papers served by his wife Debbie the day after Bernie’ s confession. Yet the pair was seen happily shopping together shortly after. What, we all wondered, was really going on?

So while the daily reports of financial mismanagement are indeed gripping, what I really want to know is this: what do all the women in this saga have to say? Only when we hear from them will we properly unravel this bizarre affair. V

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Time to Blame Our Own Greed For the Madoff Mess

The mass hysteria surrounding Bernard Madoff’s alleged $50 billion ponzi scheme just leaves me with one question. When are we going to stop talking about Madoff’s “victims” or “foolish investors” and instead ask investors to take responsibility for their own actions? Madoff’s scheme was alluring. The guy was low-key and likeable; he was hard to get to. To gain access to his fund you had to go through one of his so-called “gate-keepers’: Walter Noel, Carlos Grasso and Charles Fix. Once in you got steady returns even in the most volatile markets.

If you asked how he managed to pull this off, sources tell me, you got told simply: “Bernie knows…”

It appears none of his investors ventured further and asked the obvious sequitur: “Bernie knows what precisely? And how?”
“In a bull market no one bothers to ask how the returns are met, they just like the returns,” Jake Walthour Jr of Aksia LLC, an investment advisory firm told me Friday. In other words we are greedy. Or we were.

Aksia sent out a letter to potential Bernie investors many months ago warning them of the blatant red flags they’d found in Madoff’s operation.

But, just like so many people got suckered into purchasing mortgages they could not afford, or who allowed themselves to follow Wall Street banker’s so-called advice when making risky investments, people invested with Madoff regardless. If the returns were good – then who were they to worry, if the math or logic didn’t quite make sense to them?

For the past few years a friend made less than $50,000 pa, but nonetheless had a mortgage that put him in a house worth over $1 million. He thought this a bit strange – but heck, he had a great house.

Now, he’s got to move out, cannot afford the debt…who should he blame, the mortgage broker? Wall St.? The Government? Well, maybe – but what about himself?

If any good is to come out of the economic crisis, it has to be surely this: that as all the filth and corruption of Madoff and his ilk is unveiled, we too need to take a long hard look at ourselves and actually start to take accountability for our actions.

We can’t max out our credit cards every month or overspend without consequences. We can rant and rave about other people’s failings – and sure, they deserve it – but the first person who made a bad decision – and deep down if we thought about, we knew it – was us. V

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Take that smug smile off Madoff now

Today prosecutors will make their case that Bernard Madoff should be jailed for violation of bail conditions. On Christmas Eve he mailed out trinkets worth more than $1 million to family members. His defense lawyer says Madoff had no idea he was doing anything wrong and that these items were sentimental. Prosecutors argue his act shows he will try to hide assets as long as he is not incarcerated.

Even if Madoff goes to jail today, he still doesn’t face indictment for at least another 30 days. The grand jury has been given an extension to deliberate – and some of us are baffled as to why. Madoff has signed a confession admitting to carrying out a $50 billion Ponzi scheme. Why the delay?

Perhaps prosecutors hope that the longer they dangle a carrot, the more they will learn to help them nail the case. Maybe Madoff will be persuaded to sing about possible co-conspirators. Once he’s indicted, flexibility to negotiate becomes more limited.

But the court of public opinion is not privy to the behind-the-scenes negotiations, and it is impatient. We still remember the recent prosecution of Samuel Israel III, the mastermind of a $300 million Ponzi scheme. Israel was bailed for $500,000 and then faked his own suicide before finally turning himself in.

Furthermore, yesterday brought shocking reports that among Madoff’s victims was his own sister, Sondra, 74, who has had to put her Florida home on the market. My sources tell me that she is not selling because of financial distress caused by her brother. Rather her neighbors are making life “uncomfortable” for her. “The name Madoff is not a great name to have right now,” says a Florida businessman.

If that’s how neighbors feel about Madoff’s sister, it’s small wonder most of us are infuriated to see images of him walking near his apartment with that smug, quizzical smile on his face.

But what’s he got to smile about? If he thinks he’s taught the world that he was cleverer than all of us, or that money shouldn’t matter, he hasn’t. All he’s done is remind us of something articulated by Shakespeare hundreds of years ago – namely that: “One may smile and smile and be a villain.” V

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With Her Legs, Palin Didn’t Need a Makeover

So, just when I’d hoped Sarah Palin would disappear from public consciousness, it seems we can’t get rid of the former Republican Vice Presidential candidate. She’s everywhere and so too is the ongoing controversy over her ultra-expensive Hollywood style “make-over”. This weekend New York Times revealed details of the $165,000 the Republican party had spent on three stylists for Palin, in addition to $150,000 already reportedly spent on clothes. It’s now claimed, even more was spent than that. Palin, 44, through a spokesperson, has claimed she was “appalled” at the expense. The clothes are being given to charity.

I read all this and thought – GOP: here’s a few things you need to know about makeovers and stylists.

1) Alas, but true, we women do need a hair stylist and a make-up artist for TV. If you can find one person who does both then great but even TV networks usually have different artists for on-air talent, since different skill-sets are required. We shouldn’t knock the expense spent on that. I have no doubt Hillary Clinton didn’t set foot on the campaign trail without a hair stylist and make-up artist in tow. Speaking from personal experience, I can tell you that if you do end up on TV, with your hair unstyled, it looks like a birds nest, wisps everywhere. And if you have no make up, then under the lights, you look not like yourself, but a shining sheet-white female Edward Scissorhands. It’s very distracting from what you are trying to say.

2) The clothes: you do NOT need a stylist nor to spend insane amounts of money especially if you have a decent figure, which Sarah Palin does. All you need to know is that there is one overriding principle for the camera: the simpler you keep the clothes, the better. A floral print, stripes or check may look wonderful in real life. Absolutely not in photographs or on television. Just look at the Oscars. The women who look the best are always the ones who stick to one color and who keep the shape as simple as possible. It’s when they get adventurous, the results are disastrous. Remember, Bjork as the swan, anyone? Or Lara Flynn Boyle’s tutu experiment?

So, for Palin, of course, the irony is that dressing conservatively should have been easy. A few pencil skirts (she has great legs) fitted jackets, or a knit dress or two, simple accessories and she’d have been fine – far better, in fact that Cindy McCain, whose ridiculously over-the-top designer wardrobe reminded me of the clothes that used to be worn by the character of the rich, isolated Krystle Carrington, played by Linda Evans in the TV series, Dynasty. They did not say “woman of the people.” No wonder the Republicans got trounced.

This article was originally published by the London Evening Standard

Haggling my way through the blues

I wish I could say that this holiday season has felt as cheerful as usual. But the emptiness in New York’s streets and stores both on December 24th and 26th merely amplified the depressing retail statistics. Eager sales assistants hawked their marked-down wares with an enthusiasm bordering on desperation. “I can hold any item for you at sixty per cent off for two weeks,” one woman told me.

Her sales-pitch pushed me out of her store empty-handed and frightened. If no one else was buying, why should I be the lone fool bucking the trend?

Manhattan-based friends who travelled abroad emailed that they too were miserable. “Sixty or seventy per cent of the boats are missing from St Barths,” one friend reported in from the Caribbean.

Another said she was having a “grim time” on the beach in Mexico. No matter how strongly the sun shone, or how much alcohol was poured into her poolside cocktail, she simply could not daydream herself into a typical vacation oblivion. A third phoned from his rented villa in the sun and said that one of his guests had just been laid off. How should the host react? Should he show how upset and shocked he was? Yes, I told him.

Now is not a time for dissembling with one’s friends. We all feel vulnerable and for once it’s OK to say so. “What’s your vice?” is a question we can all ask each other openly.

It’s OK to drink, smoke or dope (in moderation). Pot is appearing at the dinner table and no one blanches. In fact if you don’t seem like a victim of stress, then you’re the one to worry about. The rest of us are deeply committed to a very public panic attack.

I’m involved in a competition with a small group of friends, in which the winner will be whoever haggles the best with their utilities providers. One has set the bar by shaving off 20 per cent off their monthly phone bill so now I find myself renegotiating prices with all salespeople from the dry-cleaner, to the deli on the corner – and reporting in how I’m doing. (Terribly, for anyone who’s interested. Hard-nosed negotiation is not my strong suit).

At least it injects a bit of much-needed humor into a grim process. Who knew there was so much fun in recounting a conversation with the plumber or electrician? Now Christmas is over and we can stop feeling bad about feeling bad, perhaps the way to get through this recession is to joke about it. V

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No One Wants to End the Party

Read the papers, watch TV – and we’re told a global recession of almost depression proportions is taking place, fragmenting the social hierarchy. At the bottom end there is tragic chaos represented by suicides and rising crime. At the top, there’s divorce, misery and a small effort to be less ostentatious about one’s wealth. Meanwhile in the middle, according to the New York Times columnist David Brooks, there’s just depression – the mood. In this class you saw your dream – and now its gone.

Well, that’s not what I see around me here in New York where theoretically the pain ought to be the swiftest and most searing.

Yes, I hear from saplings at banks that they’ve seen all their friends fired and they’re so underused they’d like to quit. Yes, I hear from wealthy people that their stocks are worthless. But do I see gloom and doom in their faces? Have I noticed people staying home at night? Have I seen, as has been stated in surveys, that hemlines are turning long and Penthouse models are large, earthy types?

Absolutely not. Reed thin models are still on magazine covers. Hemlines are high, as are chins determined to party like never before – perhaps even harder.

Black tie Charity dinners continue apace with the women dressed to kill. At a movie premiere recently I heard a media executive brag about his bonus (oblivious apparently to how sensitive a subject this in on Wall st). A tycoon held a dinner party the other night where the only sign that anything was amiss was that the host – who, ordinarily might have his ear attached to his cellphone – is so bored he’s smoking pot.

“I preferred it when I was poor and busy,” he said.

Even an economist at the New York Federal Reserve told me he’s been somewhat perplexed by the time-lag between the true appalling state of the economy and people’s reactions – especially in New York.

Yet if you look real hard you see small signs of change, At book launches people swill wine instead of water and linger instead of leaving. People debate the financial collapse endlessly but as if it were a theoretical scenario far away on another planet not connected to them.

Even a retailer I visited was positive. “It’s all about Dubai now,” he told me.

So either we’re all in denial, putting on a desperate façade. Or,more likely, so the brainy man from the NY Fed told me, it’s just that the market moves faster than us humans who will shortly awaken to our moment of reckoning.

Then, the party will really be over. But, for now, we’re squeezing out every last drop. V

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Just don’t tell us what your manicure costs

“What recession?” shouted the front page of the New York Post last week, beside a picture of a blonde Swedish countess, Marie Douglas-David. Douglas-David, a former banker at Lazard, is divorcing her husband of six years, George David, former CEO of United Technologies and worth hundreds of millions of dollars.

She is reportedly refusing to accept a post-nuptial agreement of $43 million; she wants their apartment at New York’s most prestigious building – 740 Park Avenue – and a minimum of $53,000 a week. This has been broken down into a fascinating list of her weekly needs. Travel: $8,000. Clothes: $4,500. Health/skin care: $1,000. Flowers: $600 – and so forth. She had the audacity to state in her affidavit that these figures have been cut back because of the recession.

I read all this with particular amazement since I happen to be friends with an ex-fiancé of Ms Douglas-David’s. I shot him off an email. “Bet you’re glad you got out of that ” His inbox, he replied, was full of emails similar to mine.

But Douglas-David is not the only tone-deaf woman in New York these days. Despite the searing wounds inflicted by Bernie Madoff, despite the fact that several divorces are stalled because suddenly there are no assets to divide, some people still don’t see what’s going on.

Ousted Lehman boss Dick Fuld’s wife has been spotted spending frenetically for Christmas. In an extraordinarily tacky display of ostentation Donald Trump Jr has shown the apple does not fall far from the tree by posing for a magazine with wife and baby in front of his sumptuous Christmas tree in his sumptuous apartment. I’ve heard one woman earnestly discuss with another how to get the couture sales going again. Small wonder John Thain, CEO of Merril Lynch, thought it was OK to ask for a $10 million bonus – until he was told to remember that US jobless figures are the highest in 26 years.

As for Ms Douglas-David? Here’s a tip for her or anyone in her plight. Read New York Magazine’s website as to how to list your expenses in a divorce: “Flowers = “office supplies”. Health and skin care = “puppy food”. Travel = “between New York and Calcutta”. And so on.

Really, right now, we just do not want to know what she needs to spend on a manicure. V

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