issue 259 - September 1994
The art of wasting money
Martin Fagan reports on surplus cash and serial buying.
AT the height of the boom in the late 1980s a share-dealing company in the City of London decided to do something 'special' for Christmas. Awash in profits from selling shares in one of the recently-privatized public utilities, and staffed by erstwhile street-traders decked out in Wall Street-style red braces, the firm happened upon a brilliant wheeze.
Rather than fly its entire staff to New York to do their Christmas shopping, fork out for a company pig-out in a hideously expensive restaurant, or even buy each of their dealers a brand-new Porsche, the company decided to go one better. What was needed was a display of company wealth so big, so conspicuous and so absolutely pointless that no-one would be in any doubt that this company was in a league of its own when it came to wasting money.
Picture this: the company drained all the water from its central-heating system and filled it up with... champagne. Not fizzy grape juice or sparkling wine or anything as cheapskate as that. Oh no. They brought in several van-loads of the real stuff, costing over $30 a bottle, uncorked it, poured it into the central-heating system, started the pumps and listened to the sound of evaporating money swilling around their radiators.
Spending a lot of money can be an agonizingly difficult process. Eventually, rich people succumb to what American behavioural psychologists have recently identified as 'consumption fatigue'. There are only so many hours in the day in which to eat, drink, shop and play with the things you've bought already. But the serial-buy habit's a hard one to kick.
Elton John would frequently visit Tower Records in LA and buy 1,000 records at a time. He was also famous for breezing into his record company's office and distributing gifts. Typists would receive Cartier watches and jewellery. Then in 1988, when he had so many possessions that he had to move out of his mansion, he sent them to Christie's, the prestigious auction-house. The catalogue ran to four volumes and cost $60. In four days practically everything he owned went under the hammer, making Elton a cool $20 million in the process. History fails to record what he did with the proceeds.
At Christie's again last year American Mike Malone, President of the Seattle-based music company ALE paid over $150,000 for Elvis Presley's acoustic guitar, an instrument which may have attended at the birth of rock n' roll but, even to the casual onlooker, was clearly unplayable.
Children - as anyone who has any will tell you - can be relied on to soak up an inordinate amount of cash. They are rather like a collection of vintage Aston Martins. When you're stinking rich the confines of your home town may not, however, offer enough scope for your little darlings' spending power. In that case why not charter Concorde, fly to New York and have a stretch-limo ferry you to the Schwartz toy shop on Fifth Avenue? There, if you have a spare $200,000, you can buy your child a bespoke five-minute cartoon movie staffing your bundles of joy, based on a script they write themselves. If you need something to keep them occupied while the animators get to work, $15,000 will buy them a scaled-down Ferrari which can barrel along at a top speed of 30 mph.
Most people are hard-pressed to imagine possessing wealth on such a gigantic scale. But Christmas is never far away and soon firms of City brokers will start thinking all over again about how to celebrate in appropriate style.Martin Fagan is a London-based freelance financial journalist who is currently writing his first novel. This is an edited version of an article that first appeared in The Big Issue, the newspaper sold by homeless people on the city streets of the UK.