In 1987, in a moment of uncharacteristic exuberance, my friend Hummer bought shares of Adobe Corporation. He worked at a place that had recently installed computer equipment running Adobe software. At the time, Hummer was in the publishing business, and he thought the Adobe applications were very clever and saved him hours of painstaking work with a sharp knife and hot wax.
Other people in enterprises across the United States found themselves as impressed with Adobe’s performance as Hummer was. Adobe’s stock price rose rapidly and high. When Hummer sold, he cleared two grand.
Next, Hummer bought some Genzyme, a Massachusetts biotech company with a bright future. Genzyme’s share price also rose, but not so quickly, so Hummer sold and accepted a modest gain. He decided the future lay in tech but not necessarily biotech.
But Hummer was liking this investing action. He began to suspect he had a gift. He left the publishing business, got into house carpentry. He thought he had a gift for carpentry, too — plus the hours were more flexible.
A child of the fifties who fell hard for the girls on American Bandstand, Hummer bought Dick Clark when the impresario went public, but it was a bum stock. Apparently Clark was over, even though he didn’t know it, and although Hummer had a hard time believing it. He got out of Dick Clark almost whole. He was slightly disappointed, but he had formed an abiding enthusiasm for the excitement and potential of initial public offerings.
Before long, Hummer was out on his own in the building business, but he wasn’t doing much building. In the mid-nineties, living in a rented room over Main Street, he converted the dining room into his office. Calendars promoting building materials hung on the walls. Pretty girls in hard hats and bikinis decorated piles of lumber, air compressors, and galvanized fasteners. They posed blowing imaginary smoke from the business ends of pneumatic nailers. The calendars mostly displayed long-ago months.
Hummer’s desk was littered with confirmation slips. He was still trading stocks, but he was into options too, and currencies. The slips covered the building materials catalogues and marked the pages in which months ago Hummer had been searching for windows or doors or specialized moldings. There were slips on the floor and on the chairs.
Hummer had become a trader-slash-homebuilder, with the emphasis on trader.
He was long on coms, dot-coms and telecoms. He was in and out. Most of the companies he bought had no earnings. Doesn’t matter, Hummer said, it’s all about momentum. Don’t talk to me about balance sheets. It’s the big Mo that matters. Stock’s going up, gotta go with it. Banging nails couldn’t touch it for excitement. He could not wait for the Facebook ipo.
When irrational exuberance became perfectly rational despair nationwide in 2008, Hummer thought he was on the longest down-escalator of his life. You know how this story ends. Hummer is very disappointed these days. He is also angry, furious really, with the CEOs, the CFOs, the bankers, not to mention those bloody Europeans — and Bernanke, don’t talk to him about Bernanke — that have been cooking the books, bundling the sub-primes, booking the profits and profiting on the big Mo nurtured by what were not really profits, and then there’s the veiled and soaring sovereign debts.
But Hummer, weren’t they inflating the profits and disguising the sub-primes when the share prices were rising and you were delighted, you and the executives who were cashing in their options just like you were, albeit on a much greater scale?
Maybe, Hummer says, but they lied to me and everyone else, and that’s why I’m getting out of the market. You can’t trust big corporations. These executives have to be punished, and they ought to go to a real jail, not some country club either. And the politicians, they’re supposed to do the people’s business. Instead, they do the people in.
Hummer has picked up the tattered threads of his carpentry career. He’s flipped the pages of the building supply calendars. He’s swept up the confirmation slips that carpeted his home office. He’s mortgaged some Aquinnah property to pay his margin call. He knows who is to blame for the fix he’s in, and he wants them to hurt the way he is hurting.
Angry, bruised, hurt, Hummer is, despite it all, no quitter. He says he has some ideas about what to do next. Real estate is where it’s at right now, he says, and it probably will be the best place to be for a while. Real estate has made a bottom, he’s convinced. Hummer has his eye on some Chilmark property. He says that even though large-scale development is not happening anymore, the window is open for rehabs of properties whose owners are underwater and drowning. There’s money to be made by someone who doesn’t mind a little risk. As long as prices go on rising. To Hummer, it’s got a lot to do with the big Mo.
A version of this column appeared in At Large in 2002.