Week 6 -- Grindstone

It's now 12AM and I am on my third Tanduay and coke. I am sitting in my bedroom blasting out a 20 minute PowerPoint for the charity council we are attending tomorrow. I have been here since the office gnomes left four hours ago and kicked me out of my cube. Ironically, my mad pursuit of the dollar has landed me with more community service than I ever suckered onto my college app. I thought I had forever escaped crack babies, hungry Croats, endangered marshlands, and self-righteous commserv pretty boys; instead, at the auspicious beginning of my corporate climb, perched in the penthouse of my first banking skyscraper, I'm closer to them than ever. This is the tenth hour I have spent on the third version of this PowerPoint; I have eight CDs of pictures and two binders of documents; I have done more research on the Bagong Silang Resettlement Project than anyone in the history of mankind.

These people were squatters that came to Manila from the farmlands to find work, and basically failed or ended up strung out on crack or detergent. Instead of sheltering them, the government bought a couple farms north of the city and dumped ALL of them out there, then locked the gates and hired a bunch of mercenaries with machine guns to make sure they didnt come back. No houses. No water. No electricity. Just people. You can imagine the kind of environment this produces after ten years. One guy told Ed (my boss) when he was visiting, "We'll join your [charity] program, just let me kill this bastard down the block first. And his family." Gangs are everywhere. No one has an education or any money. The only money that flows in is through crime and politicians buying votes. If businesses set up shop, they get robbed within a fortnight. Bagong Silang is the WORST of the third world: starving, displaced farmers hopping on meth, brandishing AK-47s.

Slum decor.
Angry slum dwellers.



For some reason, our firm wants to get involved cleaning up this mess. Ed told me that if the rich in the Philippines don't do something about the poor, eventually they will rebel and everyone will die. Makes sense when you consider that the rich are about 2% of the population and control 70% of the wealth. That's a big, big disparity -- much, much, much bigger than the United States, and it is felt in every interaction, every aspect of the society. Overall, though, this is really the definition of a bitch project; it has nothing to do with finance and I basically just research poor people and make pretty slides. You probably want to hear that I've had some kind of epiphany regarding the poor, but if anything the Philippines makes me realize how completely retarded poor people can be given a completely retarded government. We offer to build them houses to replace their cardboard shacks, and they refuse out of spite. When we do end up building them, they sublet them to drug lords then spend all the money on gin and crack. We build them schoolhouses and they loot them. We build them sustainable businesses (bakeries, meat shops) and no one shows up for work. We start school programs for their kids, and they force their kids to work so they can sit at home and drink rum. We dig them a well and they use it as a latrine. The problem is actually more a factor of the corruption of local politicians (taking dough from the pork barrel instead of spending it on utilities) than inherent stupidity in the population. It's pretty hard to build a functional community when you have no local representatives. This has just demonstrated to me that if you make someone REALLY REALLY poor, poorer than the poorest shithead in America, they become utterly retarded. Their focus shifts from the future to: rape anything that moves, snort anything that is granular and crushable, and kill anyone that walks by who isn't sporting your gang's tattoo. Oh, and take shits in your drinking water. My solution? Hang all the senators and set fire to the city.

This is not my only function as an intern. Ed is an incredibly gifted mentor and somehow finds at least an hour out of every day to sit down and talk with me about private equity. I realize now how little I knew about finance or business, and what a shithead I was in the Merrill Lynch interview I bombed last year. "So, what other banks are you applying to, David?" "Uhhh, if I don't get this job I'll probably just write stories." Ding. A few days ago I got to grill the CEO of a company we are looking at. Apparently this happens a lot, and they throw the job of roughing the execs up to the interns and analysts. Think police interregation, with coffee and groveling lackies. Imagine me, a 19-year-old indolent, sitting across from a guy who has poured thirty years of his soul into his company, demanding useless statistics and spurting obnoxious quips for three hours . "What's your plant capacity?" (like I know what this has to do with anything) "It sounds like your company has places to go in the industry. But can you crunch the logistics? Can you replicate? Can you scale?" (Econ 1 to the rescue) "Did you get that designed by a consultant?" (nggg...consultants good...entrepreneurs bad...) "Whose logo do you prefer -- Goldman or Morgan? Yuk yuk." At this point he was squirming uncomfortably and I launched into an unduly fraternal monologue about how we were both entrepreneurs and should learn as much as we can from each other (Honor, dude!). Then I told him I was still a college sophomore. At the end of the day, I write a report about whether or not we should invest, based upon my interview and other analysis. Partly it comes down to looking at their financials and seeing if the CEO's schpiel lines up. Mostly it's completely arbitrary.


From left: sweatshop gnome, me, my CEO