You hear a great deal about "power breakfasts," but most people don't know exactly what they are. The power breakfast is the essential meal now consumed by the business community. Without the wheeling and dealing that takes place over orange juice and scrambled eggs, all commerce in this nation would grind to a halt.
One of the most powerful places to hold such a breakfast is the Regency Hotel on Park Avenue in New York City. You must have at least $30 million in your personal banking account before they will pour you a cup of coffee. Not long ago, I was sitting at a table and had an opportunity to observe a power breakfast in play.
Four men at the next table were all buttering their toast at the same time.
One man said to the others, "I will offer three slips of pink paper in exchange for two sheets of yellow paper."
"Are you crazy, Pete?" one of the other men shouted. "This deal is worth six slips of pink paper and four blue flimsies."
Pete replied, "It might have been worth that a month ago, but the price of pink paper has gone up, and the price of yellow paper has hit a new low. But since the deal is so important to me, I will throw in a dozen pads of chartreuse unlined paper."
Another man joined in the conversation: "I can't accept that without talking to my lawyer." He stood up, walked to the next table and spoke to a man writing figures on a legal pad. The man returned to his table and announced, "We don't want any chartreuse unlined paper. We got stuck with a bunch on our last transaction with Drexel Burnham, and we still haven't been able to offload it. We would really like a straightforward deal -- purple memo-sized order blanks with pale green delivery receipts."
Everyone took a break while the waiter refilled the coffee cups. Then Pete said, "Gentlemen, I thought that when we met this morning, we had all come intending to negotiate in good faith. It's obvious that you are using this breakfast to gain the upper hand. I can go to any hotel dining room in New York and people will offer me twice as much yellow paper as I can get here. But I chose instead to hold the negotiations at the Regency because I prefer their croissants. At the same time, I am not going to compromise my principles, even if I have to pay for the breakfast."
The man who had consulted with his lawyer intervened. "Don't get all upset. We have to take care of our own interests at power breakfasts. Colored paper isn't what it used to be. Look at Donald Trump's paper; look at Mike Milken's paper; look at HUD's paper. The reason that you are stuck with pink paper is because nobody is crazy enough to give you yellow paper for it."
Pete said, "Would you be surprised if I told you that I am withdrawing my offer? I wouldn't give you any pink paper if you got down on your hands and knees and begged me."
"Nothing would surprise me," one of the men said.
"Every time you try to exchange some colored paper, you back out at the last minute when nobody will pay your price. If you don't trade us your pink paper, you are not going to have any yellow to pay off your notes to Chase. We're your last hope."
Pete answered, "Okay, you've got me in a box. I'll give six pink sheets of paper for five yellow and that's my final offer."
"How do we know that the paper is any good?" one of the other men inquired.
"Ask the waiter," Pete told him.
"Is his paper any good?" the man asked.
"It's okay," the waiter replied, "but the oatmeal is better."