Showing posts with label Devine. Show all posts
Showing posts with label Devine. Show all posts

Wednesday, March 30, 2011

The Devine Chronicles

Gerry Devine was one of the true characters on Wall Street.  What follows are a few of the short stories about the man who ended every conversation with "To Err is Human. To Forgive is Devine." (sic)  And believe me there were a lot of errors.

The Great Hair Piece-E-O
A man has a very unique relationship with his hair, because deep within his DNA could be a chromosome waiting to strike him bald.  Gerry Devine was one of these people.  For several years Gerry had been bald and never once mentioned it bothered him.  Then one day in his 60s he invited a bunch of his clients out to dinner.  Holding court with Gerry was a unique pleasure and no one wanted to miss it. 
Gerry being Gerry was late, so we all bellied up to the bar and talked about the day.  A few beers in, in walked Gerry in a brand new toupee.  We were hysterical.   Some of those at the dinner had known Gerry as a bald man for 20+ years and no one expected to see Gerry with hair.  It was my boss who chirped up first and said, “Introducing the Great Hair Piece-E-O!”  It was a nickname that lasted for the next 10years.


The War Department
Devine International survived completely on the charisma of its founder Gerry Devine.  It was not unusual on a slow day for me to call in and chat with Gerry at length about the good ole days.  Being a younger guy on the desk it was great hearing about the history of the market and the people around me.  It was much like talking to your grandfather.  Well one day in the midst of our conversation Gerry got a ring on another line.  This was common as customers would call him to do business.  When Gerry clicked back on the line he apologized and said he had to go the War Department was calling.  Baffled, I hung up the phone and asked the guy next to me why on earth the War Department would be calling a man that never served a day in his life.  To my friends great amusement he explained that Mrs. Devine (his wife) was the War Department.  It was several years later when I met the woman that I couldn’t help but laugh to myself at this memory.  She was a slight woman and one of the most forgiving ladies I have ever known.

Red Whips
Gerry loved to throw down a few cocktails and we used to joke that his other office was the bar down the road from Devine International.  On more than one occasion we had to call him there to sort out a trade problem.  When Gerry was enjoying a cocktail he drank one thing, Red Whips.  A Red Whip is a vodka and cranberry juice, but the way Gerry drank them it might as well have just been vodka.  Gerry always ordered the same way, “I’ll have a red whip with just a splash of cranberry juice for color.”  He was never shy about sending them back if it had too much cranberry juice either.
One of my favorite Red Whip stories was at a steak house in NYC.  My colleague and I had taken Gerry out to dinner for his birthday.  As the dinner wound down, Gerry decided he needed one more cocktail before the ride home.  When the waiter approached he ordered another round of Red Whips with just a splash and he shouted at the waiter “And this one is on you!”  Apparently the cocktails had been too weak for his liking.  The waiter staring at the angry, nearly 70 year old Gerry quickly complied.  We were hysterical with laughter.



Lawn Bowling
Gerry was notorious for driving everywhere he went (even in his 60s), despite having offices in White Plains and all his customers being in NYC.  After a few Red Whips with a splash, and before car services became common place, this was a very dangerous combination.  On more than one occasion Gerry made it home, but not before some “lawn bowling”. 
One evening after a late night out with customers Gerry awoke in his car in his front lawn.  There were tire tracks across his lawn and his neighbors.  Gerry being Gerry, he simply drove into his driveway, went upstairs, and went to sleep.  The next morning when my boss called him at the office to make sure he made it home alright, Gerry responded that he had done a little lawn bowling (off road driving) last night but had made it home safe.  “Lawn bowling” quickly became part of our lexicon.

Thursday, March 24, 2011

Devine International

When I first started trading government bonds, the intra-dealer market was traded entirely over the telephone.  Bids and offers were communicated on green screens and through open telephone lines to intra-dealer brokers.  If you needed to buy 2year notes you had to telephone a broker and see where the offer was from other dealers.  (Today Brokertec and ESpeed by Cantor Fitzgerald have completely automated this market.)  In this golden era for voice brokers, there were a ton of characters on the other end of the line, but none was more colorful than the legendary Gerry Devine.

Gerry Devine by the time I began dealing with him was already in his 60s and was a legend on Wall Street.  He had once been a repo trader, but quickly discovered his gift was more for gab than for trading, so he set up his own firm Devine International in Westchester, NY and began brokering repo trades between dealers.  With high level contacts at all the major dealers he was able to succeed and survive for 40 odd years.

There were several odd things about Devine International.  First they were a voice only broker, meaning they didn't transmit price information on green screens.  Two when you did a transaction with them they had no clearing facilities so you wound up trading directly with the trader on the other side of your trade.  For example if I called Garban and hit a bid on 2year notes, I would be selling 2year notes to Garban.  If I called Gerry up to trade with Devine International and hit a bid on 2year notes, I would be selling 2year notes directly to Salomon Brothers, or UBS, or whoever had given him the bid.  Devine International relied entirely on relationships. 

However, the truly interesting thing about Devine International was its origins.  Now it’s true that Gerry had set up the company because he preferred chatting with his friends to taking risk, but the real motivation lies with his father, the famous Christopher J Devine.  In 1919 the public debt reached $25,000,000,000 (a rounding error today) and trading in government bonds became a lucrative field.  Christopher J Devine started working for the first legend in government bond trading Charles Frederick Fields.  After cutting his teeth on trading through the great depression, Christopher J Devine opened his own firm in 1933, the aptly named C J Devine & Co.  His firm grew from the original 8 employees to nearly 200 at his time of death.   C J Devine & Co. was the undisputed king of the Treasury Market.  In 1964 after Christopher’s death the remaining partners of C J Devine & Co. approached Merrill Lynch, Pierce, Finner & Smith about a possible takeover.  Merrill Lynch, having no experience to that point in government bonds, seized on this opportunity. 

When Christopher passed away he was a millionaire several times over.  In fact $18million of C J Devine’s capital was left to his estate.  This made the deal with Merrill a necessity.  As for his estate, his will he set up a trust for his children.  In order to encourage them to be successful and make their own way in life he set up several incentives.  His children would receive more money for the higher the position they had at work.  So  a vice president of a Wall Street firm would get X each month from the trust, where a CEO of a Wall Street firm would get 3X each month.  So Christopher’s son Gerry after working several years at Merrill Lynch as a repo trader decided that it would be much smarter to start his own small intra-dealer broker and make himself CEO.  Devine International was born.

For more information on C J Devine & Co as well as their namesake check out these two Time Articles:
http://www.time.com/time/magazine/article/0,9171,931752,00.html