Good Time Charlie : Part 3

What Goes Up: The Uncensored History of Modern Wall Street as Told by the Bankers, Brokers, CEOs, and Scoundrels Who Made It Happen
by Eric J. Weiner

(Page 3 of 5)

But this was Merrill's background. He backed J. C. Penney. He backed Newbury. He was a good friend of Frank Woolworth. When he came back to Wall Street in 1940, after he left in '29, he wanted to do the same thing at Merrill Lynch that he did at Safeway.

EDWIN PERKINS:

Merrill had all this experience from the chain stores that he invested in. So on a strategic basis, he decided to apply some of the lessons he learned from the retail business to what he was doing on Wall Street. He took his salesmen off commissions and paid them a salary, which was revolutionary. He said the interests of the customer MUST come first, with MUST in capital letters. And when he looked at it, the first thing he really had to do was educate his customer.

CHARLIE MERRILL:

It was probably the biggest job of mass education that's ever confronted any business at any time in the history of this country.

JOE NOCERA:

It wasn't just that Charlie Merrill's ideas permeated the firm. His whole larger-than-life personality dominated the place. Charlie Merrill was the sort of person who had to be at the center of any room he entered. He was a small man but he dominated a conversation, expecting you to hang on his every word. He also wanted you to accept his word as the received wisdom from the gods. He was a fabled womanizer and a remote figure to his children. Like many driven, successful people he was a mass of contradictions, ornery but generous, that kind of thing. He loved to party and drink, consuming huge quantities of martinis as he spun his stories. And he was that way from the very beginning. He met his partner Eddie Lynch because the two of them liked to crash debutante parties together when they were young men.

DONALD REGAN:

Charlie Merrill was a great ladies' man. He had four wives and about sixteen mistresses. And he was a great bridge player. He could be very disarming. Small in stature - I don't think he stood taller than five foot seven - white hair and soft complexion. He had sort of a droll sense of humor. He was quiet and very soft-spoken with a gentle southern accent. But he had a hell of a temper. Rub the guy the wrong way and you saw the fur fly. And Charlie had a will of iron. There was one way of doing things - his way or no way.

WINTHROP SMITH JR.:

I was really young when I met Charlie Merrill, maybe six or seven. I remember that even though he was a small man in size he actually was a very large person when you met him. He had this enormous personality. Even at that young age I could see that he was a very colorful character, completely different from any of my father's other friends. I remember he had this great smile and a way of carrying himself that drew you to him. My father, on the other hand, was a New England Yankee, very unassuming, very modest, very unpretentious. He was quite the opposite of Charlie. But I think those opposing traits helped cement their relationship as it developed. In some ways they were the better parts of each other.

DONALD REGAN:

After Merrill had his first heart attack in 1944 he basically retreated from running the firm full-time. In those days heart attacks were much more serious than they are today, so he had to quiet down, be the guy who operated from a distance. He'd come to the office seldom but he always knew what was going on. Win became his eyes and ears at the firm. The relationship was symbiotic and worked extremely well. Merrill was the idea man while Win's job was execution.

WILLIAM SCHREYER (former Merrill Lynch chairman):

Mr. Merrill had all the externals, a genius and all that. Mr. Smith was a guy who could analyze things, didn't shoot from the hip. He was very thoughtful and made good decisions. By the end Mr. Merrill had such bad heart disease that he very rarely came into the office. Mr. Smith was the guy that made things happen, beautifully.

LOUIS ENGEL (Merrill Lynch's first advertising director):

Win Smith was the only man who, after Charlie Merrill had his heart attack, could have held this thing together. He was an incredible man. He was absolutely one of the most quiet, unassuming men you've ever met in your life. In those early days the partners came from all these different firms. They still had their old ties, their old loyalties, and their particular buddies down the hall. But it was Win Smith who welded this thing together and made it one organization.

WINTHROP SMITH SR. (former chairman of Merrill Lynch):

In some ways Charlie's absence was an advantage. He had a better perspective on what was happening to the business as a whole, and to our firm in particular, than he might have had had he been actually participating in the day-to-day events.

ROBERT BALDWIN (former Morgan Stanley chairman):

Morgan Stanley did not advertise. We didn't have any public customers. We just didn't do it. Our standing came from people knowing who we were and what we were already, without advertisement. It worked very well for quite a while. Now, Merrill Lynch, they advertised.

JOE NOCERA:

A guy by the name of Lou Engel created perhaps the most famous financial ad in history. It ran in 1948 in the New York Times. Basically, it was a one-page instruction manual on the stock market called "What Everybody Ought to Know About This Stock and Bond Business." If you look at it today it's unreadable - just a mess of words. But at the time it was a sensation.

Copyright © 2005 by Eric J. Weiner

About the Author

Eric J. Weiner is a financial journalist and former Wall Street reporter for the Dow Jones News Service. His stories have appeared in countless publications, from the Wall Street Journal to the Village Voice. He lives in Brooklyn, NY, with his wife, Paige.