The Wolf of Wall Street (36 page)

Elliot went on: “Your ultimate goal should be to license the Steve Madden name. Then you can sit back and collect royalties. The first thing should be belts and handbags, then move to sportswear and denim and sunglasses, and then everything else…your last stop being fragrance, where you can really hit it out of the park. And you’ll never get there if John has his way in everything. No offense, John, but it’s just the nature of the beast. You’re thinking in terms of today, when you’re red-hot. Eventually you’ll cool down, though, and when you least expect it something won’t sell through, and you’ll wind up knee-deep in some retarded-looking shoe that no one outside a trailer park will wear. Then you’ll be forced to go to the dark side and put the shoes where they don’t belong.”

At this point Steve interrupted. “That’s exactly my point, Elliot. If I let John have his way, we’ll end up with a warehouse full of shoes and no money in the bank. I’m not gonna be the next Sam and Libby.”

Elliot laughed. “It’s simple. Without knowing everything about your business, I’m willing to bet that the bulk of your volume comes from a handful of shoes—three or four of them, probably—and they’re not the ridiculous-looking ones with the nine-inch heels and the metal spikes and zippers. Those shoes are what you guys create your mystique with—that you’re young and hip and all that shit. But the reality is you probably sell hardly any of those
facockta
shoes, except maybe to some of the freaks down in Greenwich Village and in your own office. What you’re really making your money on are your basic shoes—the staples, like the Mary Lou and the Marilyn, right?”

I looked at Steve and the Spitter, both of whom had their heads cocked to the side and their lips pursed and their eyes wide open. After a few seconds of silence, Elliot said, “I’ll take that lack of response as a yes?”

Steve said, “You’re right, Elliot. We don’t sell too many of the crazy shoes, but those are the ones we’re known for.”

“That’s exactly the way it should be,” said Elliot, who six weeks ago couldn’t tie two words together without drooling. “It’s no different than those wild couture outfits you see on the runways in Milan. No one really buys that crap, but that’s what creates the image. So the answer is to only step up to the plate with the conservative items—and only in the hottest colors. I’m talking about the shoes you know you’re going to blow out, the ones you sell season after season. But under no circumstance do you risk serious money on a funky shoe, even if you guys are personally in love with it—and even if it’s getting good reads in your test markets. Always err on the side of caution with anything that’s not a proven winner. If something really takes off and you’re short inventory, it’ll make it that much hotter. Since you guys manufacture in Mexico, you can still beat the competition on the reorder.

“And on the rare occasions when you swing for the fences and you’re wrong—then you dump your shoes to the discounters and take your loss right away. Your first loss is your best loss in this business. The last thing you want is a warehouse full of dead inventory. You also need to start partnering with the department stores. Let them know you’ll stand behind your shoes, that if they
don’t
sell you’ll give them markdown money. Then they can put your shoes on sale and still maintain their margins. Do that, and you’ll find the department stores closing out your garbage for you.

“On a separate note, you should be rolling out Steve Madden stores as fast as possible. You guys are manufacturers, so you get the wholesale markup
and
the retail markup. And it’s also the best way to move your dead inventory—putting things on sale in your own stores. Then you don’t risk fucking up the brand. And that’s the answer,” said Elliot Lavigne. “You guys are heading for the stars. Just follow that program and you can’t lose.”

I looked around the room, and everyone nodded.

And why wouldn’t they? Who could argue with such logic? It was sad, I thought, that a guy as sharp as Elliot would throw his life away to drugs. Seriously. There was nothing sadder than wasted talent, was there? Oh, Elliot was sober now, but I had no doubt that as soon as his ribs were healed and he was back in the swing of things, his addiction would come roaring back. That was the problem with someone like Elliot, who refused to accept the fact that drugs had gotten the best of them.

Anyway, I had enough on my own plate to keep five people occupied. I was still in the process of crushing Victor Wang; I still had to deal with Danny, who was running amok at Stratton; I still had issues with Gary Kaminsky, who, as it turned out, spent half his day on the phone with Saurel, in Switzerland; and I still had Special Agent Gregory Coleman running around with subpoenas. So to focus on Elliot’s sobriety was a waste of my time.

I had pressing issues to discuss with Steve over lunch, and then I had to catch a helicopter out to the Hamptons to see the Duchess and Chandler. Under those circumstances, I would have to say that the appropriate dosage of methaqualone should be small, perhaps 250 milligrams, or one Lude, taken now, thirty minutes before lunch, which would give me just the right buzz to enjoy my pasta while allowing me to escape detection at the hands of the Cobbler, who’d been sober for almost five years. A killjoy.

Then I would snort a few lines of coke just before I got behind the helicopter’s controls. After all, I always flew best when I was on my down from Ludes but still crawling out of my own skin in a state of coke-induced paranoia.

Lunch on a single Lude! An innocuous buzz while dining in the armpit of Corona, Queens. Like most formerly Italian neighborhoods, there was still one Mafioso stronghold that remained, and in each stronghold there was always one Italian restaurant that was owned by the local “man of most respect.” And, without fail, it had the best Italian food for miles around. In Harlem, it was Rao’s. In Corona, it was Park Side Restaurant.

Unlike Rao’s, Park Side was a large, high-volume operation. It was decorated beautifully with a couple of tons of burled walnut, smoked mirrors, carved glass, flowering plants, and perfectly trimmed ferns. The bar was a Mob scene (literally!), and the food was to die for (literally!).

Park Side was owned by Tony Federici, a true man of respect. Not surprisingly, he was a reputed this and a reputed that—but in my book he was nothing more than the best host in the five boroughs of New York City. Typically, you could find Tony walking around his restaurant in a chef’s apron, holding a jug of homemade Chianti in one hand and a tray of roasted peppers in the other.

The Cobbler and I were sitting at a table in the fabulous garden section. At this particular moment we were talking about him replacing Elliot as my primary rathole.

“Fundamentally, I have no problem with it,” I was saying to the greedy Cobbler, who had become obsessed with the rathole game, “but I have two concerns. The first is how the fuck are you gonna kick me back all the cash without leaving a paper trail? It’s a lot of fucking money, Cobbler. And my second concern is that you’re already Monroe Parker’s rathole, and I don’t want to be stepping on their toes.” I shook my head for effect. “A rathole is a very personal thing, so I’d first have to clear it with Alan and Brian.”

The Cobbler nodded. “I understand what you’re saying, and as far as kicking back the cash goes, it won’t be a problem. I can do it through our Steve Madden stock. Whenever I sell stock I’m holding for you, I’ll just overpay you on it. On paper I owe you over four million dollars, so I have a legitimate reason to be writing you checks. And at the end of the day, the numbers will be so big, nobody’s gonna be able to keep track of it anyway, right?”

Not such a bad idea, I thought, especially if we drew up some sort of consulting agreement where Steve would pay me money each year for helping him run Steve Madden Shoes. But the fact that Steve was ratholing 1.5 million shares of Steve Madden stock for me raised a more troubling issue—namely, that Steve owned hardly any stock in his own company. It was something that needed to be rectified now, lest it create problems down the road when Steve realized that I was making tens of millions and he was making only millions. So I smiled and said, “We’ll work something out with the rathole. I think using the Madden stock is a pretty good idea, at least to start, but it leads to a more important subject, which is your lack of ownership in the company. We need to get you more stock before things really start to crank. You have only three hundred thousand shares, right?”

Steve nodded. “And a few thousand stock options; that’s about it.”

“Okay, well, as your general scheming partner, I strongly advise you to grant yourself a million stock options at a fifty percent discount to the current market. It’s the righteous thing to do, especially since you and I are gonna be splitting them fifty–fifty, which is the most righteous part of all. We’ll keep them in your name so NASDAQ won’t flip a lid, and when it comes time to sell, you’ll just kick me back along with everything else.”

The Master Cobbler smiled and extended his hand toward me. “I can’t thank you enough, JB. I never said anything, but it’s definitely been bothering me a bit. I knew that when the time came, though, we would work it out.” Then he rose from his chair, as did I, and we exchanged a Mafia-style hug, which in this restaurant didn’t elicit a shrug from a single patron.

As we both retook our seats, Steve said, “But why don’t we make it a million-five, instead? Seven-fifty for each of us.”

“No,” I said, with a pleasant tingle in my ten fingertips, “I don’t like working with odd numbers. It’s bad luck. Let’s just round it off to two million. Besides, it’ll be easier to keep track of—a million options for each of us.”

“Done!” agreed the Cobbler. “And since you’re the company’s largest shareholder, we should bypass the hassle of a board meeting. It’s all strictly legitimate, right?”

“Well,” I replied, scratching my chin thoughtfully, “as your general scheming partner, I strongly advise you to refrain from using this word
legitimate,
except under the most dire circumstances. But since you already let the genie out of the bottle, I’ll go out on a limb here and give this transaction a hearty two thumbs-up. Besides, this is something we
must
do, so it’s not our fault. We’ll chalk it up to a sense of fair play.”

“I agree,” said the happy Cobbler. “It’s beyond our control. There are strange forces at work here that are far more powerful than a humble Cobbler or a not-so-humble Wolf of Wall Street.”

“I like the way you think, Cobbler. Call the lawyers when you get back to the office and tell them to backdate the minutes from the last board meeting. If they give you a hard time, tell them to call me.”

“No problem,” said the Cobbler, who had just increased his stake by four hundred percent. Then he lowered his voice and changed his tone to one of a conspirator. “Listen—if you want, you don’t even have to tell Danny about this.” He smiled devilishly. “If he asks me, I’ll tell him they’re all mine.”

Christ! What a fucking backstabber this guy was!
Could he possibly think this made me respect him more? But I kept that thought to myself. “I’ll tell you the truth,” I said, “I’m not happy with the way Danny’s running things right now. He’s like the Spitter when it comes to holding inventory. When I left Stratton, the firm was short a couple million dollars of stock. Now it’s basically flat. It’s a real fucking shame.” I shook my head gravely. “Anyway, Stratton’s making more money
now
than ever, which is what happens when you trade long. But now Danny’s vulnerable.” I shrugged my shoulders. “Whatever. I’m done worrying about it. Regardless, I still can’t cut him out.”

Steve shrugged. “Don’t take what I said the wrong way”—
Oh, really? How else am I supposed to take it, you fucking backstabber!—
“but it’s just that you and I are gonna spend the next five years building this company. You know, Brian and Alan aren’t thrilled with Danny either. And neither are Loewenstern and Bronson. At least that’s what I hear through the grapevine. You’re gonna have to let those guys go their separate ways eventually. They’ll always be loyal to you, but they want to do their own deals, away from Danny.”

Just then I saw Tony Federici heading our way, wearing his white chef’s ensemble and carrying a jug of Chianti. So I rose to greet him. “Hey, Tony, how are you?” Kill anyone lately? I thought.

I motioned to Steve and said, “Tony, I’d like you to meet a very close friend of mine: This is Steve Madden. We’re partners in a shoe company over in Woodside.”

Steve immediately rose from his chair, and with a hearty smile he said, “Hey, Tough Tony! Tony Corona! I’ve heard of you! I mean, I grew up out on Long Island, but even there everyone’s heard of Tough Tony! It’s a pleasure to meet you!” With that, Steve extended his hand to his newfound friend, Tough Tony Corona, who despised that nickname immensely.

Well, there are many ways to go, I figured, and this was one of them. Perhaps Tony would be kind and allow Steve the honor of keeping his testicles attached to his body, so he could be buried with them.

I watched the Master Cobbler’s bony, pale hand hover suspensefully in the air, waiting to be grasped by a return hand, which was nowhere in sight. Then I looked at Tony’s face. He seemed to be smiling, although this particular smile was one a sadistic warden would offer a death-row inmate as he asked, “What would you like for your last meal?”

Finally, Tony did extend his hand, albeit limply. “Yeah, nice to meet ya,” said a toneless Tony. His dark brown eyes were like two death rays.

“It’s nice to meet you too, Tough Tony,” said the increasingly dead Cobbler. “I’ve heard only the best things about this restaurant, and I plan on coming here a lot. If I call for a reservation, I’ll just tell them I’m a friend of Tough Tony Corona! Okay?”

“Okay, then!”
I said with a nervous smile. “I think we’d better get back to business, Steve.” Then I turned to Tony and said, “Thanks for coming over to say hello. It was good seeing you, as always.” I rolled my eyes and shook my head, as if to say, “Don’t mind my friend; he has Tourette’s syndrome.”