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TheStreet Open House

10 Dumbest Things on Wall Street in 2008

DUMBEST OF 2008 #10

Spitzer Spit Out

By Mike Taylor, 3/14/08

Earlier this year, erstwhile New York Gov. Eliot Spitzer shed his renown as a noted prosecutor of high-end Wall Street firms and assumed new prominence as a notorious patron of high-end prostitutes.

To recap, The New York Times broke news of Spitzer's illegal, immoral and alleged patronage of Emperor's Club VIP, a very expensive prostitute ring. The New York governor resigned in disgrace two days later.

To make matters dumber, when Spitzer covered the cost of the "pretty, American" brunette's Valentine's Day Eve trip to Washington's Mayflower Hotel from New York, he was technically violating the Mann Act, a 1910 law no one had heard of but that Spitzer-haters now treat like a Bill of Rights amendment.

Things really reached the apex of inane when, within minutes of the revelation, CNBC's sweaty on-air editor Charlie Gasparino leapt to the airwaves to plug his new book, King of the Club, while fitting in some comment on the news someone else broke.

Spitzer's downfall was reportedly met with shouts of joy on Wall Street. As New York's attorney general, Spitzer had fought aggressively against the market's biggest names, including noted AIG (AIG) founder Hank Greenberg, former Goldman Sachs (GS) boss John Whitehead and Richard Grasso, onetime chief of NYSE Euronext's (NYX) New York Stock Exchange.

Traders in the Financial District, widely known for their respect of the law and their avoidance of prostitutes, took comfort in Spitzer's immolation as a hypocrite and fraud. Those oft-persecuted Wall Streeters, who until this week had nothing to protect them but mountains of money, could rest easy.

For once, the law was also on their side.

Update 12/26: Once Wall Street's strictest sheriff, Eliot Spitzer now spends most of his time uptown, leisurely attending to his family's real estate business. In early December, Slate.com revealed the former governor will be writing a bi-monthly column on the financial markets. Our opinion is that he'd get more readers -- and maybe even a mini-series -- with a juicy tell-all.

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