Steps from the New York Stock Exchange, only a handful of tables are occupied at Bobby Van’s Steakhouse. Across the street, Reserve Cut has scores of empty seats. A few blocks away at Delmonico’s, one of the few diners is the restaurant’s own hostess, seated at the end of a half-empty bar. It’s lunchtime on Wall Street, but it’d be hard to tell by peeking inside some of its most famed establishments. The TVs are silently tuned to the business news, documenting another topsy-turvy day in the U.S. stock market — and one that’s, yet again, kept traders and bankers chained to their desks.
Allow me to unravel the mystery of why the Wall Street steakhouses are all empty, with the S&P 500 sitting within 5% of all-time highs:
- Financial firms aren’t actually based in the Financial District anymore. They’re all on Park, Madison and Fifth Avenues between 36th and 57th Streets. The only firms with their headquarters on Wall Street are small-time broker-dealers playing the role. And they’re a dying breed.
- Steakhouse lunches are an 80’s and 90’s construct. Today’s successful hedge fund or money management titan has a resting heart rate of 10 beats per hour and under 5% body fat. Bill Ackman plays hours of tennis every day. John Paulson eats bags of organic cherries. Or so we’ve read in all the books.
- Goldman’s had four down-years for trading revenue out of the last five. And if Goldman can’t increase revenues by trading, can anyone? In this environment, layoffs are a constant threat. People are not cutting out of work in the middle of the day for a big, fat ostentatious lunch – they’re at work to do work.
- Sushi is better than steak. Yeah, I said it. Come at me, bro.
- People who need to give face time to clients still have lunch, but they aren’t based out of offices near the exchange anymore. It’s mostly technical and support personnel in the area now, largely waiting to be transferred to Jersey City. No time for lunch, have to pack their desks up.
- No alpha, no porterhouse. And no one has alpha anymore.
- The people doing the best on The Street in the modern era are not three-piece suit types. They’re quants and data scientists and software engineers. They’d rather be at Chipotle for 25 minutes than engorging themselves for 90 minutes at Delmonicos. And they certainly don’t drink martinis all afternoon because work isn’t social or a lifestyle thing for them – it’s a means to an end.