The Predators’ Ball Read Free Page B

of corporate America would be challenged, andsome would be dispossessed. In their place would come Milken’s own—a band of mainly small-time entrepreneurs, raiders, green-mailers, the have-nots of the corporate world, who had had only bit parts to play until Milken made them its stars.
    Experts would long debate whether the value that Milken’s onslaught had added to American business outweighed the damage it had done. Some of the raiders’ cant, of course, had been self-serving, but some of it was true. What was not debatable was that Milken, some of his Drexel colleagues and his anointed players had made more money in a shorter period of time than any other individuals had done in the history of this country. And they may have broken lots of rules and perhaps even a few laws to do it.

PART ONE
S preading the Gospel

1
The Miner’s Headlamp
    A T 5:30 A.M . each weekday in the early 1970s, a bus pulled up to a stop in Cherry Hill, New Jersey, and a young man lugging a bag that bulged with papers mounted its steps. He was making the two-hour commute to New York City, where he worked at the investment-banking firm of Drexel Firestone. The train would have provided a more comfortable and faster ride; but, for those very reasons, it also offered more opportunity to meet other Wall Street acquaintances. They would want to engage in the kind of idle small talk that commuters share to pass the time. The thought must have been intolerable. He did not wish to be rude, but he wanted no interruption.
    As soon as he had settled into his seat, being sure to take one with an empty one adjacent, he unloaded a mountain of prospectuses and 10ks (annual Securities and Exchange Commission filings) onto the seat next to him. On winter mornings the sky was still pitch black and the light on the bus was too dim for him to be able to read. He wore a leather aviation cap with the earflaps down; he had been bald for years, and although he wore a toupee his head always felt cold on these frosty mornings. Now over his aviation cap he fitted a miner’s headlamp—strapped around the back of his head, with a huge light projecting from his forehead.
    Michael Milken was as anomalous at the impeccably white-shoe Wall Street firm of Drexel Firestone to which he traveled each day as were the low-rated bonds that he traded there. He came from a middle-class Jewish family. He had no aspirations to climb any social ladder. He was painfully uncomfortable, moreover, in mostpurely social situations. He was oblivious to appearance—not caring what kind of car he drove, or what kind of clothes he wore, or whether his aviation cap and miner’s headlamp made other passengers stare at him. Milken was occupied, at every moment, with his own thoughts, and those thoughts were riveted on the bonds.
    Milken had grown up in the well-to-do, largely Jewish enclave of Encino in Los Angeles’ San Fernando Valley. His father, Bernard Milken, was an accountant; from the time he was ten Michael watched at his father’s side as he prepared tax returns. A boyhood friend, Harry Horowitz, recalled that the kinetic quality so marked in Milken in later years was present when he was young. Even as a teenager he slept only three or four hours a night. He was a high-school cheerleader. And then as in adult life he eschewed all stimulants—no drugs, alcohol, cigarettes, coffee or carbonated beverages.
    He graduated from Birmingham High School in neighboring Van Nuys in 1964 and then attended the University of California at Berkeley, graduating Phi Beta Kappa in 1968. While that campus was roiled with the protests of the militant left, Milken majored in business administration, managed a few portfolios for investors and was active in a fraternity, Sigma Alpha Mu.
    Milken married his high-school sweetheart, Lori Anne Hackel, and headed east to the Wharton School, the University of Pennsylvania’s business school. Horowitz, visiting him during