“Greed is good.”
You’ve heard that line before. But do you know where it’s from? It was taken (incorrectly) from a quote from the 1987 movie Wall Street.
Gordon Gekko and Wall Street the Movie
In the movie Wall Street, corporate raider Gordon Gekko, the fictional character played by Michael Douglass, gives a great speech to the shareholders of Teldar Paper, a company he is taking over. In it he actually says,
“Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge, has marked the upward surge of mankind and greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A.”
The Guy Behind the Guy
The real life Gekko is partly Ivan “The Terrible” Frederick Boesky. He is noted as initially using the “greed is good” type language that inspired the speech in the movie. Boesky, also a corporate raider, was also involved in an insider trading investigation which led to jail time.
There’s an interesting story from Time magazine on Boesky if you want more details.
By the way, corporate raiding is a term used to describe the act of buying up a large interest in a publicly traded corporation, and then using the power from voting rights to make a decision that will increase the value of shares.
It’s not an inherently bad practice, but the corporate and investing world has since decided they no longer want it around and have taken steps to prevent it.
Insider trading, a more common term, is when someone trades the stock of a company after having gained insider (i.e. non-public) knowledge about the company. See Martha Stewart’s case of insider trading as a recent example.
More About the Movie
I highly encourage you to check out the movie. It’s a great look at the excesses of the 80’s (brick cell phones included), provides some insight into the world of the real wall street, and it has some solid performances by Douglass, and by the father and son Charlie and Martin Sheen.
Director Oliver Stone does a good job, I think, of laying out both side of the story. But ultimately, a kind of good greed (i.e. hard work) wins out over the type of greed Gekko is really about, illegal trading practices.
If you need another reason to check out this film, here’s one. The sequel to the 1987 film, now titled Wall Street: Money Never Sleeps, will be released into theaters on September 24th, 2010.
What Are Your Thoughts on Greed?
Did you notice that Gekko didn’t actually say that greed was good in his speech? What he said was that he didn’t have a better word to use, so he used greed. A genius move by the writers to make you like Gekko just enough to carry the movie.
Being the free-market capitalist that I am, there’s part of me that definitely agrees with Gekko’s theories here. My own daily efforts to increase my business’ bottom line are a positive force (it results in free and hopefully interesting financial information, a vacant corporate job, support of contract services, and more money to support other businesses and charity).
I’m driven by several things, but primarily to provide financial security for my family. Is that a selfish, greedy act? Is there a good kind of greed? And what’s the word Gekko should have used?