But . . . but . . . 12 years ago, before the Swiss police walked him out of his bank and into his jail cell, before he'd even thought of writing "The Crash of '79," much less two other best sellers, Paul Erdman swung through New York in his black-toecap banker'sick shoes and a wristwatch about as thick as a communion wafer, and he was nothing like this. Nothing at all.
Right now, Paul erdman, at 47, is nodding and grinning away in Dean Krogh's office at the Georgetown University foreign service school. He is standing about five inches from the person telling him what he seemed like 12 years ago, when he was president of the Salik Bank in Basel, lean and solemn. And he loves it, he keeps ripping out these big men's-grill guffaws to think of it; with a belly now, and big red cheeks, solid American. No more Mr. Eurodollar.
What a choirboy he was on that New York swing, wearing a suit as lively as a Mercedes hearse.
"Right!" he says."That was the bit!" And the beefy laugh stampedes out again, the brass buttons flash on his tan sport coat.
He predicted, on that day, that America would have to devalue the dollar at least one -- a thought which was impossible in 1967. But not to the wunderkind, a graduate of the Georgetown Foreign Service School who went on to a PhD in economics from the University of Basel, a consulting job with the Stanford Research Institute, and then the presidency of the Salik Bank, which he cofounded.
He was an American bellying up to the bar in one of most private clubs on earth, which is to say Swiss banking, the sort of club in which there are no rules because there's no need for rules.
"Swiss bankers were all self-disciplined," Erdman says, his eyebrows rising, "until . . ."
Until Erdman's bank lost $40 million in 1979 and he was accused of trying to corner the world cocoa market, "which is not a crime a Switzerland unless you do not succeed," as he has written.
Now, he says: "Corner a market?C'mon, nobody corners markets." True, one of his assistants had contracted to buy half of the world's cocoa that year, $153 million worth, not bad for a bank with a net worth of $8 or $9 million. And thee had already been some problems with some silver and stock speculations which had lost money, but losing $40 million . . . .
Overnight, he became, as he puts it, an "ex-master banker" or "the Charlie Manson of the gnomes of Zurich," depending on how you want to look at it. He was accused of Verdacht der ungetreuen Gesachaftsfuhrung , which in Switzerland is viewed with a disdain ordinarily reserved for people who throw hand grenades into school buses. It means suspicion of untrue management.
He wangled a typewriter, then he wangled his way out of jail on $100,000 bail. Which he jumped, carrying 60 pages of what would become "The Billion Dollar Sure Thing," which led to two more best sellers, "The Silver Bears" and "The Crash of 79." Which have led to two more -- one an untitled novel he hopes to finish in January about the declining power of America, and another, called "Atlantic City," about a Wall Street-Mafia fight to control gambling. He's already sold that one to the movies.
He is rich, He lives in a house overlooking San Francisco Bay when he isn't at his ranch in sonoma County. He has two daughters at Georgetown's foreign service school, where he's getting ready to lecture a seminar in Dean Krough's office.
"The problem with banking," he says, "is that if you want to be a good banker you have to stay in the bank and watch people. All day. Every day. No fun."
Fun is getting on a plane "every two weeks" to do research, visit friends, or have lunch, as he has just had lunch, "with a bunch of big-time Wall Street types."
Who were they?
"I dunno," he says, with the men's grill guffaw lurking in the psychic wings.
He's scheduled to lecture financial experts the next day, too, "at the Hilton. Don't ask me who they are." He doesn't even know which Hilton. Then he flies up to Boston with his Swiss wife, Helly, to get roasted at a dinner held by the M.I.T. economics department.
"Samuelson's gonna be there, Galbraith. They're holding it at the aquarium. We get a dolphin show in between courses. What does that have to do with economics, I dunno, there it is, dolphins."
Anyhow, getting back to the difficulties in Switzerland, Erdman didn't spend a lot of time at the bank he was president of, and they guy who headed the commodities department bet that the price of cocoa was going up, and kept on betting as the price went down . . .
"This happens every year, some guy in a bank gets stubborn and puts good money after bad till there isn't any left. The Franklin National Bank gets on the wrong side of the dollar and goes belly up.The Swiss Credit Bank lost $1 billion!"
Erdman, slouched on a leather couch, rolls this $1 billion figure around on his tongue. It takes him out of the book of records for being the biggest loser in Swiss banking history.
Well, we all lose once in a while. He would have it sound like just another bad day at the office until it's pointed out that Erdman's bookkeeping tended to stray from what's known as "standard accounting principles."
The guffaw thunders down the tracks again: "That's for sure!"
Fun. He uses this word a lot, especially -- or even -- for a Lutheran minister's son. ("I have standard Lutheran beliefs, but I'd never try to force them on anybody," he can say with a straight face.)
And nowadays: "It's fun writing novels."
His novels are all about high finance, and there's just enough truth in them that when the projected date for "The Crash of '79" came and went (March 20) the Wall Street Journal ran a piece saying it hadn't happened.
"I predicted oil at $16 a barrel in 1978, which seemed to necessitate American exports at $50 billion. Which, by the way, is exactly what happened."
On the other hand, on April 2 of this year, Erdman predicted 7-9 percent inflation.
"Yeah well, that's when everybody else was saying six percent."
Not citibank, it is pointed out, which is a large chunk of everybody in the financial world, and which predicted 8.9 percent.
Erdman shrugs. Win some, lose some. The guffaw is never far behind. People listen to him because they have to take him seriously but because they don't have to. But if they want to, he's got all the credentials. And he's right often enough that they'd be foolish not to listen.
Anyway, he writes novels for a living now. "I found out there's only one problem in writing books -- finishing them. Once I learned that, no more problems.It's fun. It's no fun reading them when I'm done. Hell, no, it's boring as hell. Are you kidding me? Anybody who reads his own book -- wowee, pal."
Life has been good. He can here everything now except a visit to Switzerland, where he was sentenced in absentia to eight years.
He refers to another writer who just got $1 million for the film rights to his novel. "A young guy, a million bucks, and he's talking about feeling his own mortality now, he doesn't know what to do with the rest of his life," Erdman says with his face puckering into a can-you-believe-it? frown.
Erdman knows what do do. It gets better and better, even with a cancer operation two years ago. "I was glad it was cancer. Either you're lucky and you live, or you're unlucky and you die. I'd rather have go/no-go than something that hangs on . . . And afterwards, you enjoy yourself much more, enjoy life. Sunsets, yeah, I don't want to get corny about it, but yeah."
Not that he's ever spared himself the finer things. Maybe he lost everything when the bank went belly up, maybe his wife had to move into an apartment and get a job, but he can remember, says, a Saturday night in jail watching the soccer game on his television set, drinking a 1957 Pommard with the curried lobster he'd sent out to a restaurant for.He drinks red wine with lobster. He knows most people don't but he likes it that way.
Lately, he's been forecasting a long period of economic stagnation and inflation for America because of the energy crisis. He's had hopes for nuclear energy "but after the number Jane Fonda did, it's dead." We're going to lose political and military power in Western Europe, he believes. Nuclear weapons will spread, "and that's what's gonna kill us, not Jane Fonda's power plant."
By now the room has filled with students and the conversation has shifted to a lecture, the syntax still winched tight with the men's-grill ironies, the guffaw.
"Japan?" he'll say. "Listen, we're talking about Japan, Inc. aren't we? You know, those guys . . . I mean, they believe in success, don't they?"
There'll be no crash, he says, as long as Carter doesn't succumb to election-year pressure and go back to easy money. But we've come close, he says, as in the dollar crisis just past.
"People were taking paper money and throwing it at gold, silver, even copper, sugar . . ." And then a reference to a $40-million mistake that probably none of his daughters' classmates in this seminar have even heard of: "They haven't gotten around to cocoa, yet."