Tales from the 20th Century: My Embarrassing Mortgage

Our first child arrived in 1961. The following year, while JFK dealt with the Cuban missile crisis, we decided to buy a house.

Using every last dollar, we could just make the 20% down-payment on a cute, four-bedroom cape in Rowayton. At 5%, the prevailing rate our bank offered, the mortgage payments would be barely doable.

But then our banker told us the facts of 1962 life:

"You need a twenty-five-year mortgage instead of twenty? Best rate we can give you is five and a half percent." Ouch!

" Let's see, the house was built in 'forty-six. We classify any house built more than fifteen years ago as old. On old houses you have to put down thirty percent!" Double ouch!

Somehow, we managed to borrow enough from family to make the higher down-payment and buy the home we lived in for 34 years.

Isn't it amazing how conservative bankers were when loaning their own money? Yet how easily conservatism vanishes when the "lender" can hand off the loan to be packaged as a CMO and sold to somebody else who puts it in a CDO and sells it to a pension fund in Peoria or a village in Norway.

Toto, I don't think we're in the twentieth century any more
Lately, people haven't actually been buying homes, a front-page story in The New York Times points out. In effect they've been renting:

Last year the median down payment on home purchases was 9 percent, down from 20 percent in 1989, according to a survey by the National Association of Realtors. Twenty-nine percent of buyers put no money down. For first-time home buyers, the median was 2 percent. And many borrowed more than the price of the home in order to cover closing costs.

* * *

The same sorts of loans that drove the real estate boom now change the nature of foreclosure, giving borrowers incentives to walk away, said Todd Sinai, an associate professor of real estate at the Wharton School of Business at the University of Pennsylvania.

“There’s a whole lot of people who would’ve been stuck as renters without these exotic loan products,” Professor Sinai said. “Now it’s like they can do their renting from the bank, and if house values go up, they become the owner. If they go down, you have the choice to give the house back to the bank. You aren’t any worse off than renting, and you got a chance to do extremely well. If it’s heads I win, tails the bank loses, it’s worth the gamble.”

* * *

“When people don’t have skin in the game, they behave like they don’t have skin in the game,” said Karl E. Case, a professor of economics at Wellesley College . . . .

Investing and conserving wealth was a tough job when Wall Streeters still talked about "good, solid investments." The job looks a lot tougher in an age where mortgages turn into leases and more and more derivatives seem to consist of computer-modelled smoke and mirrors.

Previous Tales from the 20th Century:
Shutting Down the Stock Exchange
Good Brokers
"Going Out of Business"
Borrowing Trouble

Farmer, Plan Your Estate

Iowa farmland has doubled in value, on average, since 2000. The price of soybeans, corn and wheat is going through the roof. Result, an intensified need for estate planning by owners of family farms.

Day's Best Penny-Stock Ad

Never use round numbers, marketers. Just ask Wal-Mart. Some research suggests that round numbers can't help looking bigger even when they're not. Ask a study group which dollar amount looks larger, $41,387.53 or $40,000. Some respondents will pick the latter. Hucksters know that even the most outlandish investment claims look more plausible – well, less implausible – when displayed in unrounded numbers.. Today's example, an ad that popped up next to the New Yorker office joke of the day: Gotta love that 43 cents. Update: For more on round and unround numbers, subscribers to wsj.com can see Jonathan Clements' column. "Imagine you're selling your house, which you figure might fetch a little under $600,000. A round number, such as $595,000, will convey quality, while a precise number, like $595,385, will indicate a bargain."

Meet the Penta-Millionaires

From Julie Jason's column in The Advocate:

If you have more than $1 million, should you feel rich? Only if you have more than $5 million, suggests a recent Spectrem Group survey. Almost half of survey respondents said they would consider you rich if you had $5 million; 25 percent said $25 million; and 8 percent said you needed $100 million to be rich.

So who are the penta-millionaires? According to Catherine McBreen and George Walper Jr., authors of "Get Rich, Stay Rich, Pass It On," almost all are college graduates, and 63 percent have advanced degrees.

Forty-eight percent are retired. Of those still working, 22 percent are senior corporate executives, 15 percent are business owners, 10 percent are physicians and dentists, 7 percent are attorneys, 6 percent are consultants and 9 percent represent other professions.

How did these people get rich? Most 97 percent say they got rich from hard work, according to Walper, even though some said family connections, 13 percent or inheritances, 25 percent played a role.

What about financial goals? Eighty-four percent want to ensure they have a comfortable standard of living during retirement, according to Walper.

Three out of four use financial advisers, according to Walper, and 43 percent live off income produced by their investments.

Inflation Rate on UK Luxuries Nears Double Digits!

From January 2007 to January 2008, our producer price index rose almost 7.5%.

Think that's bad? Over in the UK, according to the economic team at RBS, the cost of luxuries has jumped even more. Last year the Coutts Wealth Inflation Index rose 9.5%.

Judge Posner takes up my argument

In the course of a post on Should Universities Have to Spend 5 Percent of Their Endowment Annually? Judge Richard Posner makes these observations:

The difficult question involves the federal income tax exemption for donations to universities. It is a legitimate question why the federal taxpayer should be subsidizing Harvard, with its $35 billion endowment. The only justification would be if the type of research and teaching that goes on at Harvard or the other major universities generates external benefits that, were it not for the subsidy, would be smaller by more than the subsidy. This seems unlikely.

. . .

Conservatives, who inveigh against big government, should not ignore tax subsidies. There is no economic difference between giving universities federal money and allowing donors to universities to deduct their donations from their federal income taxes. If the exemption were repealed, tax rates could be reduced without any increase in government spending, and in fact government spending would be reduced, since the cost of administering the exemption and the higher cost of collecting taxes when tax rates are higher would be eliminated. Hence all tax subsidies deserve close scrutiny. I am not convinced that the tax subsidy for donations to universities would survive that scrutiny.

Posner does not believe that the 5% spending rule that applies to foundations is appropriate for Universities, because they are already subject to market competition for the best students and faculty.

Britney May Need More Than a Trust

Norman Mailer had a revocable trust, and so does Britney Spears. But Ms. Spears' financial life is in a shambles nonetheless, according to today's NY Times:

On Feb. 1, the day after Ms. Spears was involuntarily admitted for treatment at the U.C.L.A. Medical Center, her estranged father, Jamie Spears, was named her co-conservator . . . . Mr. Spears is sharing oversight of her estate with an independent lawyer, Andrew M. Wallet, to dispel the notion that Ms. Spears’s parents were making a grab for their daughter’s fortune. With the court’s permission, they immediately fired her business manager.

Another team of lawyers was hired for the conservators and quickly set out to assess the financial damage. Yet another lawyer was appointed by the probate court, as is routine, to look out solely for Ms. Spears’s interests. Ms. Spears’s brother Bryan, along with a lawyer, were given control of her revocable trust, which contains all her liquid assets, so they could begin paying her bills. And Ms. Spears’s criminal lawyer, Blair Berk, was said to be overseeing the whole Humpty Dumpty-like effort.

At one time, estimates of Ms. Spears' net worth ranged as high as $125 million. Current guesstimate: around $50 million.

Care to guess whether Britney will still be rich when she reaches Julie Christie's age?

"A little, arrogant trustafarian"

That's the insult hurled at Jamie Johnson by Brian McNally. Johnson is one of the heirs to the Johnson & Johnson fortune; McNally is the family's financial advisor. The occasion was Johnson's filming of a documentary about the inequality of wealth in America, "The One Percent," reported in the Wall Street Journal as The Rich Man's Michael Moore. Johnson "has learned the hard way that the biggest betrayal for the rich is to talk publicly about their riches."

Also learning this lesson the hard way is Nicole Buffett, who appeared in Johnson's earlier film, "Born Rich" discussing life in the Buffett family. She is the adopted daughter of Peter Buffett, and so considers herself (as all ordinary people would) Warren Buffett's granddaughter. Alas, after her film debut Nicole received a letter from Warren informing her that she neither legally nor emotionally has that status.

Annuities vs. Estate Planning

Annuities (the tax-deferred investment packages, as distinguished from old-fashioned immediate annuities) are selling like hotcakes through bank channels. Investment News reports that just three major banks earned almost $800 million in sales commissions on annuities last year:

Wachovia Corp. earned the most commissions from annuity sales. . . . The Charlotte-based bank collected $483 million in annuity fees, or 0.06% of $782.8 billion in assets. JPMorgan Chase and Co. of New York came in second with $163 million in fees . . . .

Rounding out the top three was Charlotte-based Bank of America Corp., which brought in $152.5 million in annuity fees, 0.01% of $1.7 trillion in assets.

Good news for a bank's bottom line isn't necessarily good news for trust officers and others involved in estate planning. Another Investment News article warns annuities can destroy estate plans.

"Many trusts are drawn to continue beyond the death of the owner," said David F. Sterling, a financial consultant and attorney at Sterling Capital Resources of Sarasota, Fla. "When the trust receives and deposits the annuity profits, they could be subject to an onerous tax rate."

It's not necessarily the annuity purchase that is the problem, but rather how it works in this context, lawyers said.

For example, certain tax-deferred annuity contracts stipulate that an investor can designate a trust as the owner and beneficiary of an annuity as "an agent for a natural person." Since trusts are "non-natural" entities, the investor is still considered the owner of the contract, and the annuity remains tax-deferred.

However, depending on the structure of the trust, a detail in the tax code could force the payout of the annuity in the trust within five years if that investor dies. In this case, the annuity's profits are then taxed at the rates for a trust, as opposed to the rates for an individual.

Last year, for example, a trust needed to earn just $10,450 in order to be subject to the 35% income tax rate — which is higher than the tax rates assessed for individuals. The problem is especially serious for multigenerational trusts, Mr. Sterling said.

What about it, trust officers? Is the trend to investing via annuities threatening to screw up more and more estate plans?

How Can a Trust Company Go Bust?

Judging from the attention our earlier post is drawing, lots of people wonder what happened to Noble Trust Company, an outfit that seems to have specialized in charitable trusts.

Here's the story from the Colorado end, where the "Ponzi scheme" seems to have originated.

Here's the New Hampshire version from Colin Lindsey, Noble Trust's founder.

Art for Charity's Sake

As Jim Gust observes in the preceding post, we must now learn to think of Leona Helmsley as the Queen of . . . Philanthropy!

The Helmsley charitable trust will be augmented not only by the proceeds from the sale of Dunellen Hall, as reported earlier, but also by the proceeds from the sale of her art, collectibles and furnishings at Christie's.

This large green jade water buffalo from Leona's collection was crafted in China in the 1600s or 1700s. Christie's hopes the rare beast may fetch $500,000 or more.

A new queenly title

Earlier we commented that despite the bad press over Leona Helmsley's will, with the $12 million trust for her dog, Trouble, the terms of the will were likely to be upheld because of a charitable residuary worth $1 billion. We stand corrected, the charitable residuary is at least $4 billion, and might be as much as twice that as assets are liquidated. In fact, according to Slate's list of the top 60 donors for 2007 Leona was not only the most significant U.S. philanthropist in 2007, she gave as much as the next 8 charitable donors combined! Perhaps the nasty name, "The Queen of Mean," can be expunged from Leona's biography now.

(Slate's methodology does not count fulfillment of previously announced pledges, so neither Bill Gates nor Warren Buffett appear on their 2007 list.)

Could It Happen Here?

Singapore has abolished its estate tax, which it had inherited during the British era.

The conservator is named Wallet

Andrew Wallet is one of two conservators named to supervise the affairs of Britney Spears (her father is the other). Apparently a trust has been employed to manage her financial life, and her brother has been named the trustee.

“You have to diversify against the collective ignorance,”"

So says Yale's investment guru, David Swenson, in yesterday's New York Times. You can't know how the macro economy will play out, so diversification is the only answer.

No, you can't do what he does, not without access to tons of cash and staff. How should individual portfolios of ordinary investors be structured?

[Swenson] proposes a portfolio of 30 percent domestic stocks, 15 percent foreign stocks, and 5 percent emerging-market stocks, as well as 20 percent in real estate and 15 percent each in Treasury bonds and Treasury inflation-protected securities, or TIPS.

Although that approach would protect against any sort of loss, I doubt that there has ever been a year in which that asset allocation returned 28%, which is what Swenson earned for the Yale endowment last year.

Swenson is rarity not only for his outsize investment returns, but also for his lack of interest in personal wealth accumulation. It's been estimated that he would have earned hundreds of millions more had he left for the private sector—but he doesn't want to.

Queen's Dressmaker Killed over Family Will

From a story in the U.K. Telegraph:

"The adopted niece of a dressmaker to the Queen who murdered her 100-year-old aunt in a row over the £300,000 family inheritance was jailed for life on Monday."

Lesson for Millionaires: Taxes Are Certain; Derivatives Aren't

The Maher brothers realized their shipping business needed more capital, Also they faced a massive estate-tax hit if either brother died, today's Wall Street Journal reports (subscription). So they sold out for more than $1 billion and gave the money to three banks to invest in "conservative, cashlike investments."

Unfortunately, one of the banks chose to invest heavily in "auction-rate" securities instead of Treasuries or money-market funds. Now the brothers hold auction-rate securities, purchased for $286 million, they cannot sell at any price.

Many rich investors like the Mahers are now discovering they hold exotic securities wrongly thought to be safe. As a result, the subprime-mortgage crisis that began with America's most financially strapped borrowers is climbing to the top of the wealth ladder, reaching into the pockets of America's millionaires.

Yikes! Just noticed that this story on the problems of auction-rate securities is one of four in today's Journal.

Another tells us what auction-rate securities are:

These securities are issued by municipalities, student-loan authorities, museums and many others, with interest rates that reset through bank-managed auctions every week to 35 days. The auction-rate securities are essentially long-term debt, but investors treat them like a liquid, short-term holding because of the auctions. The problem is that investors have balked at the auctions lately, sending interest rates on these securities on a wild ride.

This article reports that the New York area Port Authority just saw the annualized rate it must pay on its auction-rate securities jump from about 4% to 20%!

Yet another article spotlights student loans:

The subprime-mortgage crisis has driven investors away from the asset-backed securities that are a crucial source of capital for many student lenders, prompting smaller concerns like College Loan Corp. and Nelnet Inc. to stop making certain kinds of loans. And in recent days, the market for auction-rate securities, a type of financing vehicle tied to student loans, has seized up.

Finally, Ahead of the Tape suggests that if we enjoyed last year's meltdown of mortgage derivitives, we'll love 2008's shunning of auction-rate securities:

Some guy can't pay his mortgage, and the next thing you know Citigroup needs to raise cash. Who knew?

Now, problems are bubbling in two other backwaters of the credit markets, auction-rate securities and tender-option bonds. Like SIVs and conduits, these financing vehicles issue supposedly safe short-term securities that are meant to appeal to the most conservative investors. But the credit-risk panic has shaken faith in those assets, as well, and suddenly your daughter can't get a student loan in Michigan. Once again, who knew?

Sounds like it's time to declare a

Yellow Alert for high-net-worth investors

All millionaires should be vigilant, take notice of their investment holdings, and report suspicious derivatives to their wealth managers immediately!

Examiners Take Over Trust Company

In New Hampshire, banking officials have taken over a non-depository trust company, Noble Trust Company, after "a routine bank examination uncovered evidence of alleged deceipt and false entries in Noble's books."

In court papers, the banking department said Noble Trust concealed from investors and regulators that a $15 million investment in notes issued by Sierra Factoring had become worthless; failed to have an external audit; and failed to disclose lawsuits it filed in Colorado against its former chief financial officer . . . .

Noble Trust, whose web site seems dormant, specialized in handling charitable trusts and endowments.

New Hampshire has performed no similar takeovers for decades, probably not since 1991, when that era's real-estate binge left lending institutions reeling.

The Real Great Automotive Race

Four reasons why marketers of investment and trust services should check out this interactive salute to the 1908 automobile race from New York to Paris:

1. It's an incredible story. In 1908 no one had yet driven across the U.S. in winter. That coast-to-coast trip was only the first leg of this impossible challenge. Must have been a piece of cake compared to Siberia.

2. The NY Times ( which co-sponsored the race) has constructed a remarkable presentation, complete with photos and links to the original news reports from the Times archives (now freely available). Result: a content-rich digital diary/scrapbook. The Internet may be breeding worthwhile new media at last.

3. Just imagine creating similar interactive presentations relating to the financial world as educational and marketing tools: "The Evolution of Global Investing," "Hedge Funders at Work and Play." And, of course, that old favorite, "Wall Street Lays an Egg."

4. Many high-net-worth guys love old cars. Maybe you even have a client who's planning to participate in the 2008 sequel to the Great Race.

The Case of the Millionaire's Mistress

From a story on the Atlanta Journal-Constitution web site:

Cobb County millionaire Harvey Strother had three weeks to live when his mistress wheeled him into his lawyer's office to change his will one last time.

Strother, 77 and fading fast, was drinking a gallon or more of wine a day, according to court testimony. The tortured alcoholic barely resembled the vibrant salesman who racked up a fortune with car dealerships in Cobb and south Georgia.

Anne Melican, his mistress of seven years, accompanied the wheelchair-bound Strother into the Naples, Fla., law office on Dec. 16, 2003. With an unsteady hand, Strother changed his will so Melican would be left with a South Florida property, plus a slip at a yacht club where they'd docked his boat, the Lady Anne. He also directed his estate to pay off the balance on a Cape Cod, Mass., condo he built for her.

It was the second time in six months Strother had amended his will and the third time in six years. All told, the changes left about $6 million of Strother's $37 million estate to Melican and her son, including $7,900 a month for Melican for the rest of her life and a $1.3 million Marco Island, Fla., condo.

Were these amendments the wishes of a sound mind and the product of Strother's desire to take care of Melican after his death? Or did Melican take advantage of an addled alcoholic, unduly influencing Strother to ensure she'd get millions?

The probate judge wants a jury to decide. The Melicans have appealed. Meanwhile, the AJC put the question to its readers in a poll. At this writing 38% vote to honor the will amendments; 62% oppose.

Great Moments in Financial Services

Down in Orlando, the guys at Ameritrade who deal with investment advisers must have felt like they should have stayed in bed. Well, actually, one of them did:

TD Ameritrade Institutional dedicated much of the first 90 minutes of its annual conference for advisers in Orlando, Fla. issuing a stream of apologies for the series of blunders in technology and service that beset the firm in 2007.

The task for the Jersey City, N.J.-based asset custodian at Partnership 2008 was made more awkward when Joe Moglia, the chairman and chief executive of TD Ameritrade Holding Corp., overslept and was late to deliver the opening speech.

When Wire Houses Really Were Wired

Merrill Lynch, Morgan Stanley and other broker/dealers must be as smart-phoned, wi-fied and bluetoothed as everybody else by now. Yet you still see them referred to as "wire houses." And, as in this article on their salespeople quitting to become RIAs, you still see the term "wire-house broker."

Half a century ago, the wire houses really lived up to their name, as you'll read in this 1958 Merrill Lynch ad. These chatty columns were a regular feature of The Thundering Herd's advertising in the 1950s.

Click on the image to see the column in readable dimensions.

Women as Investors

Women, though often better educated than men overall, may need to learn more about investing, reports Jonathan Clements in The Wall Street Journal. Many women investors overrate the long-term risk of losing money in stocks, while underestimating the long-term risk (or near certainty) of losing purchasing power in bonds.

Men, meanwhile, still need to learn to limit their get-rich-quick trading.

Does the millionaire woman approach investing differently than the millionaire male? The Millionaire Corner surveys that question here.

Turns out some women really are different in dealing with their advisers:

. . . 70% of men said that once they are satisfied with a financial brand or provider they would not switch, while only 54% of women said the same.

• • •

Women define “quality service” differently than men do, marking themselves as possibly finicky and definitely discerning consumers. Women are less forgiving of things like a lapse in advisor communications or weak printed materials, and inadequate online content and tools. Men tend to overlook these things more, and focus on the one-on-one relationship with their advisor.

Fifty years ago, women were largely a forgotten market segment in the investment world. But not entirely. Here's one of the classic Chase nest egg ads from The New Yorker of February 1, 1958:


Love those old Chase nest-egg ads? You'll find more here and here.

Asking Price for Leona's Mansion? $125 Million. Its History? Priceless!

As noted in The Wall Street Journal, Leona's Helmsley's Greenwich mansion is up for sale.

"Known as Dunnellen Hall, the estate of more than 40 acres was at the center of Mrs. Helmsley's 1989 federal tax-evasion trial, when she was accused of illegally billing her company for more than $3 million of property renovations."

For a country estate less than a century old, Dunellen packs a lot of history.

The history starts with Daniel Grey Reid, the King of Tin Plate.

Before World War I, in the days when "rich" meant RICH, Reid's only child, his daughter Rhea, married Henry Topping, son of the head of Republic Iron and Steel. As recounted in this Greenwich Time article, Reid decided the young Toppings should live well:

Set on one of the highest hills in the backcountry, with distant views of Long Island Sound . . . Dunnellen Hall was named by Rhea for her mother, Ella Dunn, according to "The Great Estates" by the Junior League of Greenwich. Built of steel and reinforced concrete, it originally was surrounded by 40 acres. The Toppings acquired additional land for a total of 208 acres, but today the surrounding grounds again total 40 acres.

Among its outstanding features are eight double-stacked chimneys, in varying terra cotta designs.

It has a marble-floored 47-foot-long reception hall; a marble stairway with wrought-iron railings swoops up to a double landing on the second floor and an 86-foot gallery crosses the entrance hall.

The living room measures 45 by 25 feet, with molded plaster ceiling and teak floor, and includes a floor-to-ceiling fireplace of limestone. The library is swathed in oak paneling and has floor-to-ceiling shelves and a 15th-century carved stone mantel.

• • •

When the Toppings were in residence, the estate, like many of its contemporaries, was a private world with a working farm -- corn and potato fields, vegetable gardens, a herd of registered Guernsey cows, chickens and pigs.

The year the building of Dunnellen began, Reid also gave his daughter his six-story home on Fifth Avenue. In the wintertime, when the Toppings lived there, and later in an apartment, vegetables, milk, cream and butter from the farm were sent on the baggage car of the 8:15 a.m. train to the city, where they were collected by one of the family chauffeurs for home consumption.

There were 23 servants living in the Greenwich mansion, and several working families lived on the estate. A coachman, dairyman, gardener, two chauffeurs, a farm worker and an engineer lived on site.

• • •

The three sons of the Toppings were famed in town for their parties at Dunnellen Hall and their indoor motorcycle staircase rides. Two of them also were known for their multiple marriages.

Dan, a co-owner of the New York Yankees, had five wives, among them Sonja Henie, the Norwegian ice-skating and film star, who won three Olympic gold medals, and Arline Judge, the dancer and actress, who was later married to Dan's brother, Henry J. Jr., known as Bob. Bob also was married to Lana Turner, the movie star.

After World War II and the death of Rhea and Henry, Sr., Dunnellen passed through various hands. Those I remember belonged to Jack Dick, who for a time made Greenwich the Black Angus capital of New England. (It was a tax shelter venture that didn't end well.). In 1983 the Helmsleys' bought Dunnellen and its furnishings for $11 million. They then proceeded to fix the place up.

The rest is tax history.


Proceeds from the sale of Dunnellen won't go to Trouble, Leona's Maltese. (The dog is already well provided for.) Under the terms of her will, the money will be added to the Leona M. and Harry B. Helmsley Charitable Trust.

NY Times Headline You Never Thought You'd See

The end is nigh! If the Super Bowl didn't convince you, check out page one of today's NY Times:

Another celebrity endorsement of living trusts

Norman Mailer had one. What better way to provide for six wives and nine children?

Should High-Net-Worth Investors Shun 401(k)s?

Darrell Preston and Gary Matsumoto of Bloomberg News look at the investment drag created by high 401(k) fees.

Reportedly, total expenses for participants may run to 3.5 or even 4%. With inflation lately running around 4%, a plan participant would have to achieve an investment return of close to 8% simply to preserve the real value of the contributions he or she makes to the plan. Chances of real investment growth would be slim.

Are more high-net-worth investors limiting their 401(k) contributions to the minimum necessary to obtain the employer's match?

Are more investment advisers suggesting that their clients follow this course?

For more on 401(k) fees, see this Marketplace interview with Matthew Hutcheson.

Museum of American Finance

Last month the Museum of American Finance (formerly the Museum of American Financial History) opened in a former bank building near The New York Stock Exchange.

The New York Times reviewer indicates that the new, larger exhibit area is an improvement, but hopes for more:

After $9 million in costs (and with a $3 million annual budget), the museum, an affiliate of the Smithsonian Institution, now has a library and an auditorium, along with 10,000 square feet of exhibition space on what was once the imposing “private banking” mezzanine. It is a magisterial space, its grand murals celebrating American industrial achievements — powered, presumably, by the investments of many who once banked here.

Unfortunately, the bank was completed just before the 1929 market crash, which must have left many clients in straitened circumstances. But this museum is not shy about such vagaries in financial fortune. It sees its mission as both celebratory — paying tribute to the “American democratic open market system” — and educational, depicting just how that system evolved and the ways it works and sometimes falters.

So little is taught about this subject in the public schools, and so much still needs to be learned by those who have not quite figured out the nature of derivatives and other financial instruments, that the museum is both welcome in what it attempts and disappointing in how it falls short. In some cases it is too obvious (a wall display of the objects lying behind the trade of pork belly and grain futures doesn’t add much); in other cases too compressed (being taught about the nature of bonds is one thing, understanding junk bonds is something else).

The museum's currency exhibit includes this 60-pound gold ingot from the California gold rush.

The museum may need even more space to do justice to financial history in the making. The modern evolution of mortgages – from loans to NINAs (No Income, No Assets) to teaser subprimes packaged in toxic CDOs – could require a whole new wing.

Also, new forms of wealth and new symbols of financial status keep popping up. Super Bowl tickets, for instance. The chart below is from a print edition of today's NY Times.