The Long View

When I left Charlotte and its banks for a stint abroad, the economy still had a fighting chance. Then I watched it all crumble

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On my flight to Frankfurt this summer, while I waited for the drugs to kick in, I watched a movie called The Terminal. Tom Hanks flies into JFK from an obscure Eastern European country, but by the time he gets to customs, its government has been overthrown. His visa is no longer recognized, and he can't be deported. So he spends a month or so living in the airport and going on dates with Catherine Zeta-Jones.

The customs director tries to explain what happened with a bag of chips and an apple. He puts the chips on his desk.

"OK, so let's say this bag of potato chips is Krakozhia and this apple is the Liberty Rebels. OK?"

He smashes the chips with the apple, spraying Hanks with crumbs.

"No more Krakozhia!"

The sleeping pills and airplane whiskey mixed together in my gut and carried me off into a surreal daze.

My kitchen in Frankfurt is cold and weirdly cramped. Half of the ceiling slants down, and through the eye-level skylight I can see only the roof of the next apartment building. I keep my laptop on a small table beneath the skylight, in the shadow of my German roommate's gigantic ham-carving machine. Since I left Charlotte to take a fellowship at a newspaper here, the 13.3-inch screen has been my smudged window to home. I've used it to check e-mail, call family, and read and watch the news, and in doing so piece together the blurred and unbelievable image of a country descending fast into something strange and new.

The ham machine has always struck me as very German. It's a sparkling fire-engine red and the size of an industrial-strength table saw—an indestructible and perhaps eternal force. If I knocked it off its stand, it might crash through all six of the floors below. It's old fashioned and efficient, simple but, despite the bone chunks and gristle that have been scattered along the base and jammed into the gears for months, elegant and beautiful. The machines go for something like $10,000. My roommate used to sell them out of his car. He loved the job, he says, because the people he met had saved up to buy one their entire lives.

The night I met my roommate, we were at a street fair with a big group of mutual friends. He was wearing a tight sweater with pastel stripes and was sloppy drunk, stumbling around with a bottle of wine. He overheard my accent and sauntered over to interrupt. "What happened to the invincible American capitalism," he slurred, referring to the tax rebate plan that had just been doled out in hopes of stimulating the economy.

I grumbled something about Tammany Hall and paying for votes and chalked it up to penis envy. Hard to blame the old powers for wanting to take the new one down a peg or two, jumping gleefully at every sign of weakness. That was the end of July.

A little more than a month earlier, I'd written an article for this magazine called "What Goes Up Must Come Down." It was a sort of eulogy for the young i-banking culture that had helped define Charlotte for me. It ended with an analogical wave of the hand. Buck the Banker compared his dwindling career options to an open bar at a wedding, where people order drinks a class or two above their normal fare—only the opposite. I said he could survive on decent booze for a while.

These guys were the canary in the coal mine for American finance, and for a city whose fate is so inescapably tied to it. When everyone was still partying inside the subprime bubble, with construction cranes filling the skyline and bulldozers rumbling through the neighborhoods, they were falling into huge contracts and signing bonuses, right out of college, like NFL draft picks. Now they'd been knocked back to earth. Jobs and bonuses were drying up, the moral of my story went, and they'd probably never be as ludicrously successful again. But the cyclical and self-correcting economy would render everything just fine in the end. American capitalism remained invincible, sometimes down but never out. And then I was shivering in front of my laptop each morning, watching the whole proverbial coal mine get blown to hell—Lehman Brothers, the brief relief of the Bank of America deal, smashed by the Wachovia sale, the insane bailout plan.

I got the frantic news stories on my laptop over breakfast, while most people at home were still asleep. Money quote from the president, under the headline "Talks Implode During a Day of Chaos" in The New York Times:

"If money isn't loosened up, this sucker could go down."

I imagined that by the time my sickened groan made its way across the Atlantic, it would join in with a morning chorus across the country.

"You might as well stay over there. Things are going to shit in this country," a level-headed adult e-mailed me just after the Wachovia sale, describing the atmosphere in Charlotte as one of "tremendous unease."

An e-mail from a friend, who works for Wachovia, made Charlotte seem like a devastated Third World country:

"Is Riga housing also cheaper than Belgrade? I don't know what is in further shambles, my fantasy team or Charlotte. There is no gasoline because of Hurricane Ike. Charlotte gets all of its gas from the Gulf Coast, and we haven't received any since the hurricane. People have been waiting in five-hour lines for gas and some even overnight. I have a third of a tank so I should be all right, but it is still insane. Not to mention economy concerns…"

As I sat down to write this story, I received a Gmail chat from one of my i-banking sources. He had mistaken me for a headhunter.

"Hi Michael, I was wondering if you are actively looking to fill any finance positions?"

My enormous stepdad, a steam fitter, as manly as men can get, a guy who drinks Budweiser from the can or no beer at all, has gone from Durango to Prius on the drives to work, my mother informed me through the computer speakers.

Staring at the ham machine, I wondered what indeed has happened to that indestructible American economy, and the unregulated, risk-happy brand of cowboy capitalism that snooty socialist Europeans might deride as cruel and reckless but secretly admire. Even the mountains of tax money have failed to keep this sucker from going down. The banks have been nationalized. Recession is already here. Jim Cramer is all but sobbing on TV.

Another of those i-bankers from the article has been watching everything go bust from what he calls the "bird's eye view" of a mergers and acquisitions desk in London. He saw the demise through a more symbolic lens.

"If you can pinpoint the moment that the U.S. lost its image, or mystique, or whatever it is, as the center or example for global capitalism, it was when Goldman Sachs became a [traditional retail] bank," he says. "That was your final-straw moment of losing respect for American dominance of the financial system."

The icon of Wall Street's purebred investment banks, those notorious institutions that attracted the best and brightest to engineer the complex and crazy trades that brought so much reward before risk finally got its ugly revenge, announced in September that it would soon begin helping little old ladies write birthday checks. The Wild West is dead.

Nobody here seemed all that gleeful about any of this, at least to my face. A friend did suggest I take the local Lehman Brothers sign home as a souvenir, but then backtracked so quickly and apologetically that you'd think he'd committed some mortal offense. My roommate, who is a financial reporter, has foregone gloating and vowed instead to do his part in saving the system. Frankfurt, where he was born and bred, is actually much like Charlotte. It's known solely as a banking center, giving it a reputation as boring and buttoned-up across the rest of the country, its small cluster of bank-named skyscrapers inspiring nicknames like "Mainhattan" (for the Main River) and "The Big Apfel."

So surely this has much to do with the fact that they're all screwed, too, along with the rest of the world. I was at an Obama rally in Rome just before the election, and someone brought up the old maxim that when America sneezes, Europe catches a cold—before going on to declare that America had come down with a case of pneumonia. For all his European admiration, this is something even the president-elect isn't expected to cure.

Maybe the nature of the global economy inspires a feeling of solidarity in such desperate times, as if we're all in this together. But maybe it's more like empathy, as if we're on the same level now.

And I close my laptop, finish my breakfast, and try to wipe the crumbs off my chest.

Former Charlottean Mike Giglio was living in Germany when he wrote this. His story on the local investment banking culture ran in the July 2008 issue.