Tearing Down the Wall

David Perry


Walter Schubert Jr., never planned on being Wall Street’s first openly gay trader. Schubert never, in fact, planned on being a Wall Street trader, period. Growing up in West Orange, NJ, he bucked the financial traditions of his father and grandfather when, at Skidmore College, he focused on political science and philosophy.


Schubert solidified his black sheep status when he dropped out in 1976 after two years. At age 19, says Schubert, “I wanted to go to the Georgetown School of Foreign Service and end up in the State Department, and so I went to Germany so I could pass the fluency exam in a second language.”


And then life happened. His father, Walter Schubert, Sr., a broker with Fittin, Cunningham & Lauzon, fell terminally ill with congestive heart failure. Given two years to live, he was too weak for the open-outcry hornet’s nest of pre-computer Wall Street. Father called son, suddenly heir apparent: It was time to come home. Dutiful to the last, Schubert set aside his dreams of foreign intrigues and focused his sights on Wall Street.


It was a quick apprenticeship. “He didn’t listen to the doctors. He continued to work,” remembers Schubert, who, under his father’s guidance, took up the family trade at Fittin in 1978. “He didn’t last much more than a year after that.” Schubert, eldest of six children and man of the house, went to work six days after the funeral to provide for his family. First a clerk, he worked his way up to member. Schubert was 23, the youngest pro on the floor of the Exchange ever. It was 1980.

On Wall Street

In the heady days of the Reagan era, Schubert saw the first computers, the first one hundred million-share day. Becoming a broker, he went independent in the early 80s, and again heard the call of the Fatherland: In 1987, he became president and CEO of ABD-NY Inc., a $10 million company capitalized by ABD Securities Corporation, the shareholders being Dresdner and Hypo Banks in Germany. Among the growing number of feathers in his cap: a De Novo creation of a specialist unit, the first in 100 years, was the direct result of Schubert’s leadership. He even met the Gipper himself. Things were going great.


Except no matter how fast he climbed the ladder, being gay was always there ahead of him, and getting harder to compartmentalize. Schubert, nevertheless, knew the deal. He hadn’t grown up a Catholic Republican for nothing.


“There was no way to build a career on the trading floor as an openly gay man,” Schubert says simply. ““It was a locker-room environment. [Gay] jokes were rampant.”


And options were few. Schubert opted for denial. He never dated a man; he never went to any gay establishment, be it a club, bar, or bookstore, for fear of being discovered.


“So I tried to be the absolute best floor broker in New York,” Schubert says. “I was like a marine; I got up at 5 AM, ran four miles every day. I was in top physical condition. Then I would write a daily market newsletter that had everything you could imagine and fax it out.” In 1992, at 34, he started his own specialist company, Walter B. Schubert, Inc. He even got engaged (twice). But despite all the jogging, writing, faxing, incorporating and proposing, he was still gay.


As cancer hijacks the body to feed itself, the smoke-and-mirrors act hijacked Schubert. The sheer between what he truly was and what he had to be spiraled Schubert into depression. “I was in this business to provide for my mom and brother and sisters. Once everybody grew up and moved out, I simply could not do it anymore. I was going through the motions and as unhappy as you could possibly be. My spirit had died.”


“I had no idea I had a ‘self’ that was uniquely me,” he says. Critical mass came on a snowy night in January of 1994. There was no one event that pushed him over the edge. He had lived a heterosexual life, but after 36 years of denial, all he had left was the lie.


Schubert’s youngest sister, Patricia, was on the other end of the line. With great deliberation, he came out for the first time. Her response was immediate. “She said, ‘I love you,’” Schubert recalls, relief in his voice still. A nurse, she recognized the crisis her brother suffered and immediately put him in contact with a therapist. “I was freaked out,” Schubert says. “I went in and started crying hysterically, ‘I’m the only gay man on the trading floor of the New York Stock Exchange!’” Schubert laughs at the memory. “He was very calm and reassuring.


He told me, flat out, that I certainly was not the only gay guy on the stock exchange. But he said I may become the first openly gay one.”

Old Boys Club

Despite it being the Clintonian 90s, despite gays suddenly having the lion’s share of publicity, from Ellen DeGeneres and RuPaul to Will & Grace, and despite gays winning suit after suit for equality in and out of the workplace, Wall Street remained firmly the hands of the Old Boys Club. But what is Wall Street’s “Old Boys Club?” Ask any African-American, woman, or homosexual: It’s white; it’s male; it’s straight.


Thirty years after homophobia was called “the last respectable hatred,” homosexuality on Wall Street was then (and is now) a study in contrasts. A man from Mars would think gays in any profession could stand shoulder to shoulder with their straight counterparts without fear of reprisal. By the 90s, laws were on the books in New York, both city and state, forbidding discrimination based on sexual orientation. Gay networks in several firms have been established: Citigroup has Pride, KPMG has Pride and JPMorgan Chase has PRIDE.


Before relocating from New York to Smith Barney’s Philadelphia branch, Jeremy Gussick, 32, came out to everyone in 2004, including his employers. “When I met with my future Philly branch manager, I was very upfront with him. I served a lot of gay and lesbian clients, and if I was going to bring them to Philadelphia, I wanted to be at a branch where they would be supportive, and they were.”


Deloitte, Deutsche Bank and JPMorgan Chase have all hit the business school circuit seeking gay MBAs. Schubert memorializes the late Lehman Brothers as one of the most gay-friendly (coincidentally, he sees, and foresaw, its failure as the tipping point into the all-consuming black hole of financial ruin Wall Street is in).


Now throw in the fact that of the 32 gay financial professionals, from Ameriprise to Merrill Lynch, from hedge fund managers to bond brokers, from New York to Cape Town, asked to participate in this article, only four, including Schubert, agreed, suggesting that, in spite of laws and progressive policy, fear of discovery, reprisals and glass ceilings remains palpable.


A fractured reality comes into focus: One man asked declined at once, but in the second breath stated he was out, proud and had a boyfriend for 19 years. Another, despite being in a relationship for over 20 years, said that he and his partner, a trader, never look at, speak with, or bump into each other at company events. Two others initially agreed but had to run it by their corporate communications departments. They were never heard from again. Even the retiree declined.


“Just because firms have the laws doesn’t mean those laws aren’t violated,” says Grant Lukenbill, creator of the Equality Project, a monitor of written nondiscrimination policies concerning sexual orientation and gender identity in the workplace. Some firms don’t even have the laws: Of the several thousand broker-dealers in New York City, the Human Rights Campaign lists just 36 corporate entities that specifically ban discrimination based on sexual orientation.

For some gay Wall Streeters, a million-dollar payday is adequate compensation for staying in the closet. Others are beholden to hypotheticals — on the condition of anonymity, a gay quantitative analyst and vice president at Deutsche Bank describes an Orwellian existence. He is part of his company’s gay network and is out socially, but closeted to immediate co-workers and clients. It is for future clients unwilling to have a gay man handle their finances that he remains so.


Throwing a punch

A straight trader, also anonymous, stated he would never come out if he were gay. “It would have negative consequences,” he says. “Not direct, but probably like a glass ceiling. Someone needs to come out to make it more acceptable, but that first guy to step up may pay big.”


That he is unaware someone already did step up is indicative how well the subject can be kept under wraps. Nevertheless, his words are prophetic after the fact — Schubert started paying the nanosecond he cannonballed into the placid waters of Wall Street’s hermetically-sealed heterosexual environment.


Schubert describes how, over the course of two years through slips of the tongue and overheard conversations, his orientation became an open secret on the floor of the Exchange. Rumors simmered at a slow boil until, in 1996, Schubert’s uncle, James J. Maguire, Sr., then chairman of Henderson Brothers, was asked by other floor traders if all the whispers were true. Maguire replied they were.


His brother was also ganged up on. “These other traders cornered my brother,” Schubert explains. “They cornered him, saying, ‘We know what your brother is doing on Halloween. He’s going to be on Christopher St. with a d__k in his mouth.’”


“If I had to beat it out of him, I was going to get it. I wanted an apology,” recalls Schubert, his thunderbolt-blue eyes flashing. “He told me, ‘So come down and beat it out of me.’ I said, ‘See you in 15.’”


Schubert suspected, rightly, that his staff, even family members, were being disdained, harassed and bullied for nearly three months in 1996. His antagonists never slithered out to confront the elder Schubert directly, even though he was the one they were after. But he would bring the battle to them, if need be, even if it meant a brawl at Wall and New Streets. Every gay man has to know how and when to throw a punch.

On the defensive

Before his brother was ganged up on, before Schubert himself came to grips with his sexuality (“It was like learning a whole different language”), he was on the defensive. Outside The Street was relatively accepting. Inside was not. “My friends there, even a director, told me to keep it to myself,” Schubert remembers. “They said it would ruin my career.”


Some were happy with that idea, in spite of very strict rules in place dictating floor behavior. First, it was the specialists. “My job was to make the decision about when stocks should be sold, and in those days, you went to a specialist to ask for a specific quote,” Schubert explains, who at the time was in the Blue Room. “After I came out, a lot of specialists ignored me. They knew I was there, and acted like I wasn’t. I had to threaten to get a governor involved. Even then, I never got the full picture.”


Then there was the calendar incident: Bemoan if you will, but sex pervades the Financial District. The aggressively heterosexual culture of Wall Street, in and out of work, is well-established. In an office bedecked with tits & ass calendars, Schubert put up the beefcake equivalent. For months, somebody took it down and put it in his desk every night. Only when Schubert bellowed across the room a challenge to the self-proclaimed — and not a little hypocritical — moral police did it remain in place.


“When he started telling people, it got around quickly, and some guys were just mean-spirited,” says Schubert’s cousin, James J. Maguire, Jr., then in the Main Room as a specialist with Henderson Brothers. He recalls the hypercompetitive, hypermacho environment of the age, “If any sort of weakness was perceived, people would just pounce.”


When they pounced on Schubert’s younger, weaker brother, the line was crossed. When Uncle James, although with the very best of intentions, advised letting it slide, the powder was lit. To this day, one can hear the frustration in Schubert’s voice.


“He told me that I was different,” he says. “That this is just the way these guys are, and that I had to be the better man. If somebody said something really off-color about my uncle’s wife, and he slugged the guy, it’s OK — but because I’m gay, it’s not. I had my own family telling me I had to operate with one hand tied behind my back while people trash me.” (Let it be known, however, that uncle and nephew were, and are, very close.)


It is an industry where reputation is everything, Schubert’s was being shredded. But Wall Street had taught him well, and those lessons were about to be used against it. “I ordered my attorney to call whomever he had to call to make this s__t stop. I was ready to sue the f_____g pants off this place. I hadn’t worked 15 years to have it all torn to pieces because I’m gay. I was not fooling around; I wanted to take the roof right off.”


He has no idea who was called, but the homophobia came to a dead stop. “I took away their toy,” Schubert says.


Legal measures

Other salvos were to come. Schubert wasn’t the only target.


In 1999, Joe Daniel did what Schubert threatened, slapping a $75 million bigotry suit against Dresdner. Daniel, a VP fired soon after he came out, suffered conditions similar to Schubert prior to a “company-wide downsize” that axed only him. Wall Street firms require all such cases to be handled internally, that is, privately, but because Dresdner (ironically, one of Schubert’s past associates) is German, Daniel’s case was outside the privacy clause.


In short order, the suit went public and the press, already having a field day with Salomon Smith Barney’s notorious Boom Boom Room allegations, launched into a feeding frenzy. That the case ended in a confidentiality clause was a moot point; Daniel cast light onto a corporate culture demanding a segment of its population operate entirely underground. While in some industries gays are seemingly a requirement (fashion) or a non-issue (publishing), other sectors, including finance, indicate that social progress, like morality, comes in degrees.  


But in degrees, via social evolution and legal revolution, Schubert, Gussick, and Maguire, Jr. (who notes the “pouncers” have long vanished) see the inexorable force of change at work in the FiDi, the Exchange Floor, even the Old Boys Club. “The Exchange has done quite a bit over the years,” says Schubert, who credits former progressive policies — and spine — of former NYSE CEO John Thain with regime change. “There is the Exchange’s Diversity Council, and the NYSE rings the Gay Pride bell every June.” (Schubert cringes the first time he rang that bell: “I was so nervous. I look at the video and think, God, smile Walter. Smile!”)


But change rarely occurs in protean leaps, and Schubert notes that while these tentative steps by Wall Street may be of the baby variety, they are, never the less, steps in the right direction.


Off the floor, Schubert launched the online Gay Financial Network in 2007 to address and satisfy the unique financial needs of the LGBT community, tapping a market worth $712 billion in 2008. He also helped facilitate the annual Exchange dinner with the National Gay and Lesbian Chamber of Commerce (NGLCC), of which Schubert is a founding member and chairman. Under the banner of the NGLCC, he and other members of the organization were some of the first to meet with the then newly-elected President Obama to discuss the economic stimulus package, and introduced the idea of a capital gains tax-free zone “bad bank” as a method of attracting private investment.


“I know I’ve had a very important role in moving the Exchange along the path of celebration, not just tolerance,” says Schubert.


Today, at 54, the man the Exchange knows as “Schubie” is founder and CEO of The Schubert Group LLC, a global management consulting firm. He prides himself in being “office-less,” being able to up and move where clients need him, especially as he, and the rest of Wall Street, look on in nauseated awe as the markets stagger from the financial equivalent of a sucker punch. But he is confident that the days of literal slugfests are over — his own battle royal on the streets of the FiDi, in fact, never happened.


“Even if I won, I would have lost on all counts,” Schubert reflects. “I have, now, a lot more empathy and compassion. I don’t believe in settling differences with violence. That guy was just hurting. As the saying goes, ‘Hurt people hurt people.’”


Author Bio:

New York City-based writer David Perry once taught English in Japan and was a writer for NASA. His work has since appeared in The Advocate, Instinct, Trader Monthly, and Dealmaker magazines, plus publications for the American Foundation of Savoy Orders and the Huguenot Historical Society of New Paltz, NY.

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Sjoerd Van Oosten, Flickr
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