Wall Street Troubles: Are They Too Much to Bear?

No Panic in New York -- So Far

Washington Post Staff Writer
Tuesday, September 16, 2008; Page C01

NEW YORK -- If you're one of those Manhattan-haters who hopes the city has been truly smacked upside the head by all the grim news out of Wall Street, listen to Alan Matarasso, a plastic surgeon with an office on Park Avenue.

In recent months, there's been little drop-off in the number of face pulls, breast augmentations and tummy tucks he does. Actually, he says, the turmoil has caused an uptick in a certain type of client: the laid-off, mid-career executive who wants to hit the job market looking as taut as possible. The only hint of bad news is that some clients are suddenly getting cost-conscious -- for instance, the teenager who recently came in for a nose job.

"I had worked on three of her siblings," Matarasso said. "Now, normally I charge $9,000 for a nose job, but we knew for a fact that her father had had a change in situation, so we worked with that person. We didn't charge an operating room fee, which is about $2,000."

Matarasso paused for a moment.

"We're not a discount store," he said, "but we're in the business of making people happy."

Take note, rest of the planet: It'll take more than a couple of belly-up brokerage firms to put the hurt on this town. Not that there is any lack of dread here. Anytime the mayor takes to the airwaves, as Michael Bloomberg did yesterday, to offer a pep talk and a Xanax to the locals, they worry. And no matter how comforting Hizzoner's words, there are plenty of plot twists that could yet change this movie into an economic horror show. Some companies are already getting singed, and plenty of people worry that they're about to get burned.

But for the time being, there's little evidence that hard times have hit Gotham. What's amazing is how economically impervious the place remains, even with megafirms such as Bear Stearns and Lehman Brothers closing. We're talking about a place where 3.5 million people work every day, said Mitchell Moss, a professor of urban planning at New York University, so the city can roll with a lot of punches, even a mass layoff of very rich people.

"There will be a decline in sales of Cristal, and a lot of high-end restaurants in the suburbs will get hurt, because the suburbs are where a lot of these finance guys live now," Moss said. "But this isn't a one-industry town."

This resilience will, of course, disappoint those of you who have been hoping that a downturn will take some air out of the monster truck tires that have long been the city's economy. You are one of those people if you noticed that yesterday's New York Times wedding announcement pages included a few employees from Lehman, and you said "Awww" in a mildly sarcastic tone. Maybe you just hate the Yankees, or perhaps you prefer the place the way it looked in bad old "French Connection" days of the '70s, when it still was a little dangerous. You might even live here and dream about the day when real estate craters, big time, and you can buy in.

Well, for the moment, you'll have to keep dreaming.

"I don't think the vultures will ever be well fed in Manhattan," said Pamela Liebman, CEO of the Corcoran Group, a real estate firm.

A few Lehman-ites have put their homes in the Hamptons on the market in the last couple of days, Liebman said, and others have pulled out of negotiations on deals that were imminent. A lot of potential buyers and sellers are in holding-pattern mode, waiting for a hint about what's coming next. Which is to say that signs of panic are very hard to find.

CONTINUED     1        >

© 2008 The Washington Post Company