Kissing the Underbelly

By Joseph Anderson and JUDY MILLSPAUGHAN M.D.

Jonathan Harrington Crossleys parents had great
expectations of him. He belonged to a family of intellectuals
and he was expected to follow in their footsteps. But
Jonathan wanted something different something more real,
something more connected with life. He wanted to taste the
excitement of the business world. He even saw himself as a
future Donald Trump. The fact that he was black never struck
him as relevant. Kissing The Underbelly, co-authored by Joseph
Anderson and Judy Millspaugh Anderson, M.D., is a novel
about love, poverty, the stock market, survival and race relations
set in Philadelphia, PA

• Language: English
• Publisher: Xlibris US
• Release date: Sep 30, 2011
• ISBN: 9781465367655

Book preview

PROLOGUE

Jonathan Harrington Crossley had rebelled during his sophomore year at St. Thomas’s College. He had taken a good hard look at the narrow confines of his father’s pedantic life as a philosophy professor at St. Tom’s and had decided it was not something he could spend his life pursuing. He also chafed at the thought of continuing as a student at St. Tom’s under the watchful scrutiny of the old man and all his pompous cronies. He wanted something different—something more real, something more connected with life. All the Crossleys and all the Harringtons were intellectuals, however, and they were all supposed to go right on being intellectuals. It was expected. His mother was tenured in English literature. His uncle was history of western civilization at Yale. Grandpa had also been philosophy. It’s what they did. Who they were. They were scholars. Jonathan wanted to make money. He wanted to taste the excitement of the business world. He was interested in high finance. There seemed to be an aura of glamour there that was lacking in academic scholarship. He saw himself as a future Donald Trump.

The fact that he was black never struck him as relevant.

He transferred out of St. Tom’s for his junior year and went to Philadelphia, enrolled at Temple University’s Fox School of Business and Management, and took a major in finance. He was fascinated by money, good at math, had an excellent memory, and he worked hard. He naively assumed that that was what it would take to succeed in life. His father disapproved. They argued. Then they went beyond arguing and ceased speaking. The old man agreed to finish paying for the education up to graduation but stated flatly that, from that point on, Jonathan was on his own and would get no further help from home. Graduation meant a bachelor’s degree, and no further. And paying meant tuition, room, and board only. Whatever fees were payable directly to the school. There was to be no allowance for such mundane sundries as laundry or the occasional night out with friends. Jonathan lived in the dorms but attended part-time for four more years, mostly in the evenings, and supported himself by working part-time in an accountant’s office for a bare subsistence wage plus partial benefits. Despite the hardships, he managed to accumulate grades that were at least respectable, albeit not spectacular. He salivated over Temple’s executive MBA program, but it was not to be.

Jonathan was average looking. That was how he thought of himself. Averagely black—not too dark, not too light. Averagely tall. Averagely handsome. Averagely attractive. His weight was average. He thought of his intelligence as only average, but in fact, it was well above. He had grown up in a college town, in the midst of an academic family. Everyone in town was of above-average intelligence. So in a sense, in that environment, his IQ was average for his surroundings; but by national standards, he was very bright.

While he was vaguely aware that he had not grown up in the real world, as he thought of it, he was woefully ignorant of what that real world actually involved. He had been raised in a microcosm that was blissfully distinct from life as it is experienced by the masses. His family had long ago retreated to the security and protection of a purely intellectual existence in a small college town in Pennsylvania, a bastion of tolerance and liberalism that allowed them to forget that they were black, and to raise their child in ignorance of what it meant to be black. Horrified by the prospect of their only begotten child immersed in public-school culture, they had investigated several private schools only to find that none measured up to their standards. Indeed, they were repulsed when one well-intentioned headmaster glowingly described the school’s fledgling black studies program and determined from that moment on to homeschool their son.

Both of his parents were descended from house slaves, and their ancestors had long ago bought into the values of their white masters. They had perceived themselves as somehow better than many of their brethren, and they identified with their masters and tried to distance themselves from their origins. They saw that their masters sent their young people to college, and once they had received freedom, they endeavored to emulate that practice. Several generations of black Crossleys and Harringtons sent their sons—and, eventually, their daughters—to colleges and universities across the land. Over time, the younger generations lost the awareness of where these values had come from but never lost the subjective feeling that their very survival depended on those values.

The elder Mr. Crossley vaguely sensed that there was danger lurking out there in the real world and wanted to protect his son from it, but he did not know how to do so other than by attempting to coerce Jonathan into staying and spending his life cocooned in the groves of academe. Upon failing to force his son to follow in his own footsteps, he took the only other recourse known to him and disowned the boy.

CHAPTER 1

JONATHAN

Jonathan therefore went forth and worked hard and did fairly well and, in due course, graduated with a bachelor’s degree in business and finance and went out into the world at large to seek his fortune. His dream was to start as a stockbroker, with a view to eventually heading his own brokerage firm and competing with the likes of Charles Schwab and Merrill Lynch. He diligently made the rounds of the major brokerage houses in New York and shopped his transcripts and résumé around on the confident assumption that he would any day now be on his way to fame and fortune. Nothing happened. He began to get the impression that he was being laughed at everywhere he applied, but he could not imagine why.

This was the summer of 2001, and he sweated through a long hot summer in New York, with nothing to show for it. He was still unemployed and staying in a friend’s loft on September 11 of that year. New York in the aftermath of that disaster was most definitely not a good place to be looking for employment in the world of finance. The city was in shock, and nobody even knew if they had a future, and nobody was hiring for anything—even janitor. With a heavy heart, Jonathan gave the endeavor up as a lost cause. He retreated back to Philadelphia and took a job selling insurance and continued to apply to brokerage firms. He started with the best firms. The top places, the ones with the excellent reputations. Then he tried the second-string places. Any brokerage firm, anywhere. He finally found a spot in a company he had never heard of—called Pellagrini Incorporated—that agreed to take him on and train him and sponsor him for his licensing exam. There were no benefits attached, so Jonathan signed up to pay his own health and dental insurance. He found an inexpensive policy by the simple means of Googling on cheap health insurance.

Early in his first week on the new job, he attended an orientation with a principal broker. This was a somewhat overweight Mediterranean-appearing guy who nevertheless exuded an air of success and confidence. He stood before the little band of new hires and gave a well-rehearsed introduction. For those of you who haven’t met me, my name is Greg Tarkissian, and I’m the general securities principal here at this office. I’d like to welcome you to Pellagrini’s, and to wish you the best in your training and on your future exams. I don’t want you to think that working here as an apprentice and studying to pass the Series 7 exam will be easy, because if you slack on one side, you will not be able to continue on the other. Your knowledge from study and your performance as an apprentice both must continue to show steady improvement, or both will be to no avail. I probably will not see much of you while you’re running this race, but I will be the first to congratulate you if you manage to cross the finish line. I wish you all well.

Tarkissian’s speech was, as they say, short, sweet, and inspirational. As Jonathan listened, he dreamed of the day he would finally sit for his Series 7 exam, which would make him a fully qualified broker. He made up his mind that nothing would deter him from that goal. As apprentices, Tarkissian informed them, they would need to seek out and cultivate new leads and clients for the existing brokers. Most newbies, he said, approached this endeavor with the innocence of a Christian meeting up in the den with a lion for the first time. After being pummeled by the public on a daily basis, many of them would drop out. Only the visionary few with the eye of the tiger would continue. Jonathan was determined to be among them.

He found himself sitting at a desk all day long, making cold calls to elderly widows, trying to convince them to invest their life savings in questionable stocks. He had a set of prepared, rehearsed sales talks, which he stumbled through repeatedly as he proceeded down a list of phone numbers he was given each morning. He was discovering, however, that it was not only the apprentice that was armed with a prepared speech, but the public had its own script. Every presentation he made was balanced by a prepared excuse on the part of the client he was calling. Often, the people he called were more practiced at the process than he was. He did not make much headway. Since he was still unlicensed, he did not yet get to keep any new accounts he generated but had to turn them over to a licensed broker and go back to the telephones. The income was via commissions, not salary; and Jonathan lacked talent as a salesman, so his income lacked as well. It was not a classic boiler room—there was no pressure, and no one seemed to care if he came in or not since they were not actually paying him. Jonathan had bills to pay though. There was the rent, the electricity, the gas, his health and dental insurance, his car insurance, his VISA and MasterCard bills, his Internet account, cable bill and phone bills (one for the landline and one for his cell), plus all those little things that kept cropping up, like his car registration and the fee for the neighborhood parking permit, not to mention food and laundry and dry cleaning. So he pressured himself and put in long hours just to make ends meet. He was forced to put himself through an inhuman grind that left little time to learn the basics of the business. He always arrived at the office well before his breakfast felt settled in his stomach. The anxiety and uncertainty never ended. The adrenalin began to flow, and the acid in his stomach would churn before he even reached the front door of the building. With no baseline salary, each day’s income was an unknown at the beginning of the day.

Jonathan looked up at Winslow who was sauntering by on his way to the senior broker’s office suite. Winslow did not seem to have any such uncertainty. Winslow would have already whetted the appetites of his clients/victims, entreating them to buy into investments of questionable ilk without any concern as to their future well-being, so that he need only sit back and wait for them to fall into his traps. He used their own greed to ensnare them. Winslow was an equal-opportunity predator, concerned only with whether or not the next client was able to keep the playing field level with at least the minimum amount of dead presidents to maintain his average daily commissions. For current clients, whenever the investment turned south or the client became overly inquisitive, his assistant/apprentice would take the calls and practice how to placate the unsettled client while Winslow worked on new fish to fry.

You smell that? Winslow said as he lifted the lid from his Starbucks special order. That’s the smell of fresh commissions in the morning. He had managed to add to his client list even the starry-eyed clerk at Starbucks, who apparently was converting his tips and a good portion of his savings to junk bonds while giving Winslow free customized coffees in the belief that this would somehow get him an inside track on investments. The odor of his mocha latte drifted over the cubicles to which the various brokers were also drifting in slow procession.

Are you still yanking Cliff’s chain? asked one of the other established brokers with a smirk on his face as he settled in to his desk.

I don’t have to yank it any longer. That chain is now fastened to the front door! said Winslow.

Oh no! You don’t mean—

Yep! He’s now a proud member of the Blingenhof Fund. The Blingenhof Fund provided brokers with good fees, but was generally known as a true dog with fleas. Now if I could only find me a good restaurateur, maybe I could revise that old saying.

What old saying is that?

That there’s no free lunch in this world.

Jonathan and the other novices listened to the banter as the top brokers migrated to back offices and the conversations faded slowly from the reach of their ears. Just like the contrast between the well-appointed offices of the top brokers and the shabby cubicles occupied by the beginners, so also the investment vehicles they promoted were also quite diverse. While Winslow and the others laughed about getting a client to invest in the doggish Blingenhof Fund, Jonathan never steered any of his clients to it, despite the fact that it had a prominent place at the head of the list on his daily printout of suggestions and instructions. He had a conscience that told him not to completely abandon the interests of his clients, but he more often than not did compromise his standards. When he didn’t, his personal income suffered as a result, but he drew the line at the Blingenhof fund, among others.

Jonathan felt driven, and with every failed cold call and every refused account, he felt himself being pulled nearer and nearer to the edge of a dimly perceived doom. Nevertheless, he spent every spare moment studying for his exams and taking practice exams and generally living and breathing the stock market.

He hated what he was doing to earn his commissions, but while it oftentimes felt immoral, it was at least legal and it paid the rent. He dreamed of a day when he could be an important broker, handling impressive accounts for big-name clients, with an office in a high-rise overlooking the city. He viewed what he was doing as a learning experience to be endured and was confident that it was only a way station on the way to his dreams.

He had found a halfway decent apartment in the Bella Vista neighborhood that rented for less than the going rate, as the landlord had not upgraded in several years. He had a reasonably current wardrobe, and he was in walking distance of the colorful mosaic storefronts and popular watering holes of and around South Street, but he had no time or spare money for any kind of a social life. He rarely dated since restaurants and shows were beyond his pitiful budget. He developed only one friendship down there in the pits (as they called it) with a friendly, unassuming white boy named Jerry Johnson who seemed to be in pretty much the same predicament as he and who shared much the same values.

Over cheap sour coffee on their occasional breaks, they lamented the crass attitudes of their coworkers and hailed themselves as paragons of moral virtue. They were not going to perform these shoddy practices one day, or one minute, or even one second longer than they had to. Oh no. As soon as they passed their exams and became licensed and could get a real job in a real brokerage firm, then they would only do the good stuff, the virtuous stuff. No more cold-calling; no more hard selling of dubious stocks. No more fifteen-hour days for very little money. They would work for big commissions, brokering deals for major players. And so, finishing their greasy donuts washed down by acrid coffee, they would return to their desks and call more little old ladies.

CHAPTER 2

JERRY

Jerry Johnson was twenty-nine and still lived with his parents.

Not that he was especially immature or afraid to strike out on his own or lacking in girlfriends that he might want to bring home, but his parents made it so easy to stay that he could never find the motivation to spend the extra money and effort to move out. They were very supportive of his interests and wanted to make it easier on him. They had the space, they pointed out, and it would just go to waste if he didn’t use it. Jerry contributed a little to the grocery and utility bills but, otherwise, lived rent-free.

Slightly shorter than average with dark-brown hair and greenish eyes, Jerry looked sufficiently like Toby McGuire to acquire the occasional nickname of Spidey—which usually caused him to cringe on the inside, but which he had learned to discourage by simply ignoring it outwardly.

He had majored in human services only to discover he wasn’t the least bit interested in it once he had the degree. He had worked at various jobs after college and invested every spare penny in the stock market. He taught himself the ins and outs of the market and developed a fair level of competence at picking good stocks with growth potential to invest in. And his little portfolio was growing steadily. He felt he could do better if he actually worked in the field and could meet and learn from others who did likewise.

He set out to find a job in a brokerage firm and discovered it wasn’t so easy. There was a catch-22. In order to work as a broker, you had to have a broker’s license. But in order to get a broker’s license, you had to pass the broker’s exam. And in order to take the broker’s exam, you had to be employed as a broker. The only way around that loop was to find a brokerage house that was sufficiently interested in you to hire you on a temporary basis and sponsor you for the exam and provide on-the-job training toward the exam.

The big brokerage houses could and did pick and choose from the top graduates of Harvard and Wharton, or from among applicants who came to them well supplied with letters and recommendations from colleagues and cronies from inside the industry. They hired the sons—and, occasionally, the daughters—of other successful brokers or of the CEOs of major corporations. There were few females and even fewer minorities on their payrolls. People with average grades from average schools need not apply, and Jerry had average grades with a degree in human services from a small Midwestern college of no particular reputation.

Jerry’s father was the owner of a fairly successful clothing manufacturing and distribution company, and he had always nursed a hope that his son would someday join him in the rag trade. But he was nevertheless supportive of his son’s choice and did what he could to help him get into that line of work. He was head of a minor company but was himself from a blue-collar background, and he lacked the connections to get his son placed in Merrill Lynch or Price Waterhouse. The best he could do was a small brokerage firm in Philadelphia called Pellagrini Inc. And so Jerry found himself toiling in the same environment in which he would later meet Jonathan Crossley.

The work was tedious and boring and sometimes ethically questionable. But he was getting a start in his chosen profession, and he pursued it with single-minded devotion and never complained about the working conditions. He worked hard and studied hard, and in his off-hours, he partied hard and invested in the market. He reasoned that life was better than, say, for a medical intern, who had to work thirty-six-hour shifts for practically no pay. He felt he was on the road to his future. He dated a lot but did not connect for any serious relationships. He made some acquaintances from among the other broker trainees but formed no close friendships for the first year. He focused on learning what he needed to learn to pass his licensing exam. He was a talented salesman, and he was constantly pulling in new accounts for the firm, so they gladly kept him on even though he did not sit for the exam during his entire first year with them.

In his second year at Pellagrini’s, Jerry clicked with a new trainee that was hired by the firm. He and Jonathan Crossley hit it off right from the first day. Jonathan was black (in fact, he was the only black trainee there) and was more or less shunned by the other trainees. He gave the impression of being blissfully unaware of the rampant bigotry in the place, and at first, Jerry admired him for his seeming composure in the face of overt discrimination. In time, though, Jerry came to realize that it was not an act—that Jonathan actually was blissfully unaware of the subtle ways in which he was mistreated. Jerry, who had been raised in a tolerant family and attended Philadelphia’s public schools, had grown up in an integrated environment, and the only thing he could not tolerate was intolerance itself. He became protective toward his new friend, and they became closer and closer as time wore on. They took their breaks together, studied together, and occasionally socialized together after hours. Many a Friday night saw them nursing beers and talking to attractive women at Fat Tuesday’s on South Street. Jerry lived outside of the city, so on Fridays, he would go home with Jonathan and crash on the sofa for the night. He couldn’t park at Jonathan’s due to the resident parking restrictions, so he would leave his car at work and pick it up the next day. Jonathan’s apartment was so close to South Street, they just walked up and back and never had to worry about a designated driver on the rare occasions when they overindulged. They talked endlessly: about life, about their families, about women, and most often, about the stock market. They shared the same passions and interests and moral values, and they never ran out of subjects to talk about. They became each other’s best friend. They continued to plan for the day they would pass and become genuine licensed brokers.

CHAPTER 3

NOW WE ARE BROKERS

The day did finally come when they passed their exams and received their precious licenses. These were not actually called licenses, but registrations. They were now registered representatives under the firm’s license. They could not just walk out the door and use it on their own but were inextricably tethered to a firm. There was a slight increase in their commissions on new accounts, but more importantly, they now got to keep those accounts as well as receive new ones from the fresh trainees.

Other than that, nothing changed. The next day still found them at their usual desks, conducting their usual business in the usual manner. Jonathan’s rent was due, the utility and phone bills were due, and work beckoned. Merrill Lynch did not call offering a position. Life went on.

It was the ambition of every broker to build up his or her book, or portfolio of clients. These were the clients who used that broker exclusively to conduct their trades and provide information and advice. The higher the amounts of the assets under that broker’s management, the more attractive the broker himself, or herself, became not only for the sponsoring firm but to other firms as well. Jonathan and Jerry grimly proceeded with the task of building their books.

Unfortunately, most of their clients fell into one or another of three categories, none of them particularly desirable. The first of these were the enthusiastic beginner investors, who promptly lost a lot of money and left with a terrible impression of investing and a vow never to invest again. The second category were those investors who actually made some money, but then left the firm and took their accounts elsewhere, to better-known firms that could offer them better services and more access to information. Finally—and most numerously, it seemed to the two brokers—there were the clients who invested very small amounts, or perhaps only invested once and had very little impact on a broker’s income, but who made major demands on a broker’s time. They invested little money but had great expectations. They tended to be graspingly needy and would call constantly, asking for service or information or advice. They were ideally suited for mutual fund account investments, but fantasized that they were sophisticated stock traders. Since word-of-mouth recommendation was a big part of gaining new clients, the new brokers could not afford to alienate even these nonproducing clients but spent many an hour in tedious satisfaction of the imagined needs of essentially worthless clients.

Jonathan hung up from a client call, held up a forefinger, and recited, As a broker, let us never forget that it’s not only what you brought in yesterday that the firm cares about, but what you produce on the present day.

Amen, Jerry responded.

The boredom was briefly broken by one broker whose father got him a ten-million-dollar account, but then he shortly left and took his account to a better firm.

I’ll bet that ten-million-dollar account will keep Andrew well paid, Jerry said with a dreamy look in his eyes. If I could get ten accounts like that for at least five years, I could probably take at least the following twenty years off.

"Well, I think ten accounts like that could make a good foundation for a budding new firm," Jonathan countered.

Not me. I just want to make a pile of money and retire early and have fun.

The scandal of Andrew’s departure generated a few weeks of gossip over carburetor coffee, but things soon settled back to their usual level of monotony. Getting accounts like that was a nice pipe dream, but the day-to-day reality was an incessant list of cold calls followed by commission checks that barely rose above subsistence most months.

In this manner, Jonathan slaved at his desk for a total of another two years—still dreaming, still sending out résumés, still hoping—until the day when they all reported to work only to be told that Pellagrini Inc. was going out of business and filing for bankruptcy. Their services would no longer be required.

There was a stunned silence at first.

Well, what now? one usually quiet broker spoke up. Others joined in with a cacophony of useless and directionless complaints and suggestions.

I’m not sure where we do go from here, but I think if we stick together as a group, we might be attractive to a new firm, Jerry interjected. The combined value of all our books presented together will carry more weight than either one alone. It made sense, but very few were interested in that idea, and there was a mad scramble among all the brokers and trainees for new positions, any position, anywhere. Jerry proved correct, however, and for those who agreed to join forces and present themselves as a unit, it made a big difference. Jerry had a friend who had a friend and heard about a firm that was hiring and might take a number of the brokers. So that was how Jonathan, Jerry, and three others from Pellagrini’s wound up at Craig Szlotny Inc.

They soon suspected that they had gone from bad to worse, however. To be sure, in some ways, there were hints that the working conditions might eventually get better. Jonathan and Jerry were still working as hard as at Pellagrini’s, and in much the same way, but there were senior brokers who had been there only a year or two who were doing considerably better and were obviously making better money. There was hope, but there were also subtle problems.

For one thing, they were now in a true boiler room. It was a cavernous space carved out of an old warehouse, and it was filled to capacity with desks, each outfitted with a phone and a computer screen. This firm wanted every seat filled during working hours, and filled they were. Nobody ever worked part-time here, and nobody ever casually took a day off on a whim. The desks were manned by a motley assortment of desperate-looking freaks. While it was still largely a white male operation, there were a few more females and several minorities and even a few obvious foreigners. In addition, there were fat people, ugly people, crude people, and people whose hygiene was questionable. Szlotny was, at his core, a pure bigot but, despite himself, was truly an equal-opportunity employer. At this firm, it seemed that you weren’t measured by your character, race, creed, color, religion, or country of origin but, rather, by the size and frequency of your commission checks.

Unlike at Pellagrini’s, there was an atmosphere of intense pressure. Everybody was given a quota to meet. Most appeared desperate and looked as if they thought they were going to die if they didn’t make the next sale. A few, though, had a smug look about them and appeared conspicuously prosperous. There was a visible hierarchy defined by one’s clothes, car, and haircut. A number of the senior brokers seemed to be doing very well indeed.

Toward the back were some offices retrofitted into the building, and these housed the most senior brokers and Craig Szlotny himself.

In particular, some of those guys appeared to be doing that well by virtue (or lack of virtue) of some fairly questionable practices. It wasn’t that anyone ever came right out and asked Jonathan or Jerry to do anything illegal, but there always seemed to be an innuendo, a hint in the dialogue that suggested that they come up with underhanded practices on their own initiative. It seemed pretty clear that the senior brokers were indulging in some kind of nefarious behavior, but