CHAPTER ONE

Fortune

Never believe anything you read in a fortune
cookie.
— Dal LaMagna (DL)

In August of 1968, my dad and I were traveling over the Throgs Neck Bridge in our ’ 58 Ford Country Squire, a Woody. I was 22 years old and on my way to Harvard Business School.

As a senior in high school I was so determined to go to Harvard College I did not apply anywhere else. Even with almost a straight - A average, I did not get in. However, because of my basketball skills, I ended up getting into Providence College on late admission, an all -boys Catholic school in Rhode Island. There, I did not distinguish myself academically, graduating 253rd in
a class of 350 students.

EVERYONE STARTS SOMEWHERE

To make matters worse, there was an instance in my college career when I almost got expelled. At the end of my sophomore year, the priests sent me across the Atlantic Ocean to get me out of their hair. Then, while spending my junior year abroad, the U.S. ambassador to Switzerland told me to return to the States for “behavior unbecoming a student guest of Switzerland.”

I had, during those years at college, started 11 different businesses, each of them imploding in its own fashion. Along the way I had compiled an inch - thick scrapbook filled with newspaper articles, ledger sheets, photos, and a journal, vividly detailing each of these failures. In my senior year I sent a summary of these exploits to Stanford, Columbia, and Harvard business schools with an accompanying letter that sought to dismiss my rather dubious academic qualifications and highlight instead my business failures. “This compulsive capitalist,” I wrote, “seeks your knowledge and guidance.”

My background certainly pointed more in the direction of the Willy Loman school of business than to any of these distinguished Ivy League citadels, but as fate and the gods of irony would have it, I was accepted by both Columbia and Harvard business schools.

My dad and I stopped at a diner somewhere in Connecticut. It was the kind of place my father felt at home in with its faux red leather seats and Formica tables in booths along the windows, the sound of the highway in the distance reminding everyone where they had been. He was a longshoreman when the Brooklyn piers were at their peak at 8,000 men strong in the early 1960s. You could easily picture him in
his T - shirt and work pants, a striking, good - looking guy like Marlon Brando in On the Waterfront , tossing sacks of coffee over his broad shoulders while the bitter winds of the early morning kicked at his face. But my dad wasn’t the hard - drinking stiff that Brando portrayed. He relaxed, not with rooftop pigeons, but with the New York Times crossword puzzle. He would do these puzzles as fast as he could print the letters, as if some divine source had already provided him with the answers. And he used a pen.

“You' re a smart young man — you got your mother's genes, after all. ” He laughed as we sat down in our booth. “But you know, I would have been happier with Columbia. At least you would have been closer to home. Not that I have anything against Harvard. Christ, it's a great school, the best in the world, maybe. It's just most of these kids — these young men you’ll meet — they were born with a silver spoon. Are there any Italians?”

“I don’t know, Dad.”

“Well, your mom's happy, anyway. She had Loretta, Sal, and me over last week, and Loretta was going on and on like she usually does about her kid Bruce. He's so smart this and clever that — a genius. Gabbing away about her brilliant Bruce, how he has a full scholarship
to UC Berkeley. Your mom is real quiet; she's not saying anything, just waiting for her moment. Finally, Loretta, so pleased and proud, asks your mom, ‘Oh, and where is Dal going to school? Is he even going to graduate school?’ Well, your mother sits back as cool as a cucumber and says, ‘Harvard.’ She says ‘Harvard’ like she’s flicking a piece of lint off her sweater. Loretta’s jaw dropped to the floor. After she and Sal left, I can't remember your mom and me laughing so loud for so long. ”

My mother, Cucci LaMagna, and my father, Aldo.

They had recently gotten divorced, so it was good to hear they could still laugh together.

The Harvard Business School campus was as beautiful as I had imagined it. If someone had asked me, I probably would have said that its tree-lined walkways were paved with gold. The buildings were classic red brick with open, grassy courtyards. It felt like a country village in England, cozy and quaint.

My father pulled the old Woody into the rear parking lot behind my dormitory. I was two days early, wanting to get myself acclimated. I figured I needed whatever leverage I could garner, and two additional days couldn ’ t hurt. As I collected my suitcases from the back of the car, I could see several students from the previous semester walking along the pathways, packing up their sports cars, getting ready to leave campus. I nodded to a few of them, but their eyes were focused elsewhere. Our Woody was overheating and the steam was rising all around us. Nothing like this ever bothered my dad. In addition to being a longshoreman, he was also a full-time New York City fireman and was
usually ready for any emergency. He always carried a fire extinguisher. He opened the hood and we both looked down at the engine.

“It needs some water,” he said.

I could hear the hiss of the radiator, and for the first time I felt my heart beating faster and noticed that my palms were damp; the realization that I had finally made it to Harvard was sinking in.

My dad shook my hand and slipped me a hundred-dollar bill. “You take care of yourself. And if you run into any problems, you call me right away. Promise?” He got into his car and backed out of the parking lot.

I knew then, as I know now, that there was nothing my dad wouldn't do for me. He worked two full-time jobs to support five kids and a wife. That $100 he gave me didn’t come from a stock trade; it came from about 11 hours of work. Here I was standing in the midst of
the biggest opportunity of them all, and I sure as hell wasn’t going to squander this. With my dad’s hundred, my $85, and the $5,000 loan Harvard had given me to pay my tuition, I had $5,185 to my name: not bad for this kid from Rosedale, Queens. As I climbed the stairs
to my new dorm, I began thinking about how I could get enough money for a car.

My shoes slid and squeaked as I passed each room, an Old Spice-like smell rising from the wood floors as if they had been polished with it. I stopped in front of the closed door to my room and was about to open it when I heard a voice from within. I knocked. A young man, older than me, opened it, phone to his ear, and waved me inside. He then turned away, holding the base of the phone in one hand and the receiver to his ear. I could tell he was in an intense discussion, because, except for that wave, he wasn’t acknowledging my existence. I checked out his orange turtleneck and Brooks Brothers khakis and thought if it were a football Saturday he could have been holding a pennant in his hand. He spoke in a commanding baritone in the King’s English. I sat on the edge of the bed in rapt silence soaking in every word. He seemed destined for big things.

“Global Marine --yes, I have the call letters, G - L - M. Yes, Stanley I have the whole picture, Global Marine. Sounds like an absolute can’t miss . Of course I’ll buy it. I ’ ll even buy some for my sister. Thanks for the tip, Stan."

So this is what goes on at Harvard Business School, I thought as I quickly jotted down the call letters.

He grabbed his leather briefcase and scurried out of the room. I ran after him down the hall and yelled, “Hey, what’s with this Global Marine?”

He stopped and turned in my direction. “They just discovered gold in Alaska, my man, and Global Marine owns it.” He threw me a look like he had just lit the biggest cigar in the world, gave me the thumbs-up, turned, and left.

All my life I had spent on the outside of this world, watching people who by virtue of birth or status got to be privy to information that a poor, blue-collar person like myself never got a whiff of. I had somehow managed for all those years to believe that people who succeed succeeded on their own and all the people who fail failed on their own. Well, now I realized that that wasn’t true. I was a failure because I hadn' t been to Harvard Business School.

I needed to be calm, organized, and patient. I needed to get all my ducks in a row, consolidate everything I had, and focus all my energies on this sure thing. My hands trembled as I dialed a stockbroker in New York City.

John Krause was a guy I had met the summer before while taking the subway into Manhattan. He worked for Hayden, Stone and Company, a downtown brokerage firm, and he was the only real Wall Street guy I knew. When I first told Krause that I was going to Harvard Business School, he said, “You’re going to Harvard? What — to spread fertilizer?” He laughed.

"No, I’m going as a student."

Krause looked at me like surely I was pulling his leg and if he stared at me long enough I would crumble and tell him that I was just bullshitting. Of course this didn’t happen, and Krause soon became one of my biggest cheerleaders, my friend, and my stockbroker.

When I heard his voice on the other end of the phone, I immediately dove in.

“How can I buy or control the most amount of a stock with my money? I’ve got a huge stock tip.”

“Who doesn’t? ” he replied, somewhat jaded and exhausted by the thought.

“This isn’t just any stock tip. This is a stock tip from Harvard Business School.”

There was a silence at the other end of the line. I could almost hear bells, whistles, and the ring of a cash register dinging inside Krause’s sleepy brain.

“Okay. I’m all ears,” he said.

I told him how I had heard about Global Marine, describing my source in superficial detail — what he was wearing, how he spoke. Krause did some quick research, and sure enough, there seemed to be interest in Global Marine recently. The stock was moving up.

“How can I get the most mileage for my money?"

“How much money you got?"

“Five thousand, one hundred, and eighty-five dollars.”

“You could buy the stock on margin and get twice as much as the money you put up,” he said.

“Is there a way I could get more leverage? Own or control more of the stock with my funds?”

“Well, you can buy a call. A call is the right to buy 100 shares of a stock over a period of time for a fixed price. With a call you can basically control or, in a sense, own 100 percent of the purchase price of a stock by putting only 10 percent down. So with $ 5,000 you can control $ 50,000 worth of stock. There is a downside. The stock has to go up at least 10 percent for you to make back all your money. If it stays put or goes down, you lose all your money. And the stock needs to move within 30 days. After that your call expires. Hey,
haven’t they taught you this shit yet?"

“I’ve been here for just an hour. Classes haven't even started. Anyway, I ’ m in. I want to buy $5,000 worth of calls of Global Marine, right away.”

I unpacked my belongings and took a walk across campus. The early-morning fog had darkened into a downpour. I had no rain gear or umbrella. The deluge beat down on me, but I could not have cared less. I felt like Gene Kelly skipping through puddles, twirling around lampposts. I noticed the Student Union building and decided to duck in to do some quick calculations.

In those days I had long hair. It was thick, unruly, a sort of white man’s version of an Afro. I was drenched to the gills. There were a few students at various tables and chairs, reading or in casual hushed conversations. I scanned the room, realizing that these were the faces of students who I would be spending two whole years with so I’d better get to know them.

I walked up to a group huddled in a corner and extended my wet hand.

“Hi, I’m Dal LaMagna.” I moved from one foot to the other. You could hear the water in my sneakers sloshing around. They didn ’ t move. They didn’t even blink an eye. They looked at me like I was an escapee from a mental hospital.

“Does anyone have a pencil and paper I could borrow?”

A round-faced blonde girl quickly tore a page from her loose-leaf notebook and handed it to me along with a pen. I thanked her, walked to a nearby table, and sat down. Oh c’mon, I thought, so I ’ m a little wet. Get over yourselves. I’m not going away, and in a few days when it gets out how much I’ve made on Global Marine, you’re all going to want to know me. You're all going to be asking for my advice.

I spent the weekend looking at cars, sound equipment, and some new albums. I bought a few textbooks, did some jogging along the Charles River, and watched a couple of scuttle boats race.

When Monday morning came, I was as excited as a kindergartner. I was really looking forward to learning from the masters. Half my brain, however, was focused on the stock market and Global Marine.

I called Krause.

“So how’s it doing?”

“Global Marine has been closed for trading!” He said, unable to contain his excitement.

“What does that mean?"

"Incredible is what that means."

"Incredible good?"

“Incredible very good. The only reason the exchange closes a stock is because there are so many people wanting to sell or buy it. So the specialist in charge has to stop the trading so he can figure out the correct price. This could be a killing. I’ve got the whole office in on this one. We are both going to be heroes.”

When I was young I believed my dreams were my right, that the world was predisposed to acting in my best interest. When success came that day, it came like a self-fulfilled prophecy. I went to classes that afternoon with the certainty that I had a special arrangement with the gods and that from that day forward I would forever and always remain in their grace.