Book Review: 'Confessions of a Wall Street Analyst'

Reingold is at his best when he's telling his own story.

Some of the best parts involve his salary negotiations. He stops disclosing actual dollar amounts when he hits the millions, but he's forthcoming on how he was able to double his previous pay rates.

Probably the most telling episode in Wall Street's elevation of analyst to star is a $1.5 million pay error in Reingold's favor. After negotiating yet another astronomical raise, he reviews the numbers and discovers $1.5 million extra. He tells his boss and a new contract is drawn up to exclude the extra pay, though Reingold laments that no one congratulates him on his admirable honesty.

Unfortunately, Reingold doesn't exactly deliver on his promise to reveal the inner sanctum of Wall Street banking. The times when he's actually asked to "go over the wall," to meet with investment bankers working on deals, don't quite turn out to be as juicy as one might hope. His role is largely limited to making presentations about a company's value, its addressable market, its strengths and weaknesses.

One begins to wonder if Grubman couldn't write a better tell-all book on how the real dirty deals get done.

As ethical lines blur amid the market mania, Reingold held even tighter to his belief in numbers. He took comfort knowing that his research was based on empirical science. Like many in his field, he had a strong faith in financial models. Using spreadsheets, he could extrapolate reasonable conclusions as long as the numbers provided by the companies were correct.

Notably, Grubman used the same numbers to draw his own conclusions. Yet both analysts, and the rest of the world, were totally blindsided when the numbers turned out to be phony.

Even though Reingold was lied to by executives early in his career, he's still crushed to discover that bookkeeping at the big telcos like WorldCom and Qwest (Q Quote) fudged billions of dollars. Dispirited and angry, he takes early retirement in 2003.

Though he waits until the end of the book to say it, you are already reading it between the lines early on. "I'd come in as an idealist and left a cynic," Reingold tells you.

It's difficult to imagine how Reingold navigated his way to upper echelon of street pros without sacrificing his naivete. But because he failed to apply a cynical lens to his analysis, he was blind to world right below his nose.

In Reingold's soul-searching conclusion, he admits that he should have blown a few whistles on insider corruption. But given his mind-blowing salary, his silence appears bought.