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History Repeats Itself

Nobody had expected the Wall Street crash of 1987, much like no one expected the current meltdown

Wall Street is different, but not all that different, from Dalal Street. The buildings are taller and bigger, there are more tourists on the road and, instead of pani-puri, you have hot dogs. I had my first hot dog - a sausage wrapped in a bun - in the street just across the road from the New York Stock Exchange in 1987. I have visited the street only once since then but the hot dog man has vanished.

A friend of mine - an Indian was working in a broker's office nearby and, from what I could see, he was doing very well for himself. He had made so much money that day, he treated me to a slap-up lunch in a restaurant nearby. He said he would make a couple of million in two or three years and would return to India for good, a very wealthy man.

A couple of days later, I took a plane back to London and learnt to my great shock that the market had crashed. It was the so-called Black Friday, the crash of October 19 or 20 1987, I forget which, and there was panic around the world. Nobody had expected it, Wall Street the least.

History is now repeating itself, as it always does, and I have no idea where my broker friend is at the moment. He is probably running a taxi in Manhattan, not far from where he used to buy and sell stocks, or maybe a petrol pump near Central Park.

The CEO's of half-a-dozen finance companies which they ran into the ground may be keeping him company, though I doubt it. They must have made billions flogging their bogus financial products and bought themselves huge seaside mansions in the Caribbean. Or, for all we know, they too may be running taxis in Manhattan.

The Americans, unlike Indians, seem to take these ups and downs in their stride, almost as if they expected them. In fact, most of them do. Theirs is a very strange life, always on the edge, teetering between millions and billions on one side and a handful of dimes on the other, but it doesn't make much difference and life goes on, maybe with a new job and often a new wife.

But it doesn't work the same way for Indians, or at least some Indians. I had a friend who used to work for Hewlett-Packard, the computer company, in Palo Alto, California. When HP decided to downsize, they threw up a long list of departments where the axe would fall. My friend was managing one of these departments and he had to decide which of his colleagues to fire. He had worked with most of them almost all his working life, and the decision was not easy. “How did you do it?” I asked.

He said he decided to call them in one by one, not on the same day, and give them the bad news. But it was easier said than done. He was, after all, an Indian, not an American, and such things are not done in India. My friend had come up working for a government electronics company in India, where nobody is ever sacked.

So he called his junior colleagues, one by one, and had tea with them. They suspected something was up, and knew what was coming, but kept their cool. My friend had lots of morning teas and coffees with them, but when the time came to utter the dreaded word, he just couldn't do it.

In India, if you are the boss, you can always pretend you didn't know anything, as Naresh Goyal of Jet Airways did recently when his company sacked nearly a thousand staffers.

But things are different in America.

A few days later, my friend was called in by his boss and told he was fired. “Why?” asked my flabbergasted friend.

He never got a proper reply, but he knew and they all knew why. You live by the sword, you die by the sword, often the same sword!