Another Scary Day for the Regulars : The Schwab Bunch Just Hangs In There

A hairy spider hangs from the ceiling and a scowling ghost floats in the doorway, but the real horror--the kind that grabs you by the throat--shimmers in a ghoulish green from a computer screen.

The numbers, which represent the loss of millions of dollars to investors all over the world, haunt the regulars of Charles Schwab, a discount brokerage firm in Laguna Hills. This small knot of people has been here since before the New York Stock Exchange opened Tuesday, 6:30 a.m. in California, before the break of dawn and before the bumper-to-bumper traffic on Interstate 5.

There Are Other Demons

In the office’s small reception area, surrounding the two Quotron computers that spit out stock quotes and financial news, are fake cobwebs, orange and black crepe paper and an assortment of Halloween monsters. But the regulars, concerned with other demons, don’t seem to notice.

They are too scared.

“No, we’re not brokers,” says Bob, an accountant. “We’re just broke.”

Bob, like most of Schwab’s other regular front room clients, doesn’t give out his last name. That is getting too personal when the talk turns to thousands of dollars in losses. And on the day after Black Monday, when the Dow Jones industrial average took a record-breaking nosedive of 508 points, almost everyone is talking about losses.

But then there’s Rick, who sells computer parts and packs a beeper. He is wired on adrenaline, a bundle of nervous energy. He punches in stock symbols on the computer keyboard. The market is moving up, fast.

“You see Polariod, $19, is that a buy or what?” he shouts to no one in particular. “Look at Ford, up six.”

Another member of the morning crew, who won’t even offer his first name, chimes in: “The big boys are making big money. Those poor people who sold yesterday. Why did they sell?”

At the helm of the other computer is Sidney, a retired San Clemente store owner who has taken to nursing her stock investments as a full-time job. She is at Charles Schwab, five days a week, by 6:15 a.m. She munches on pre-cut apple slices, brought from home in a plastic bag, for strength.

Her losses, she says, “are too terrible to talk about.”

“Why did they have to let (former Federal Reserve Board Chairman Paul) Volker go?” she wonders aloud. “This would have never happened.”

There is general agreement that Volker should replace U.S. Treasury Secretary James Baker. Immediately.

He Turns to a Graph for Comfort

Off to the side of the computers, Peter, his half-glasses barely hanging on the end of his nose, is attempting to impose some order on the chaos surrounding him. He is drawing a graph that records the erratic path of Tuesday’s Dow Jones average, a barometer of the collective mood. Right now, his pencil point is heading downward--the market’s early rally is coming to an abrupt and violent end.

Cold coffee in foam cups is sloshed from side to side by the motion of waving arms. The jingle of coins in trouser pockets appears to be rising to a crescendo. Pacing space is at a premium.

“The worst that could happen is happening,” says Don, rumored to be have suffered more than a $100,000 paper loss Monday. “There’s always a sucker rally.”

With the worsening news, the pre-dawn crowd at Schwab is enlarged by retirees from nearby Leisure World and businessmen too concerned with their stocks to show up at their offices.

But one 85-year-old Leisure World resident, Tuesday’s edition of Investor’s Daily folded between his fingers, remains stoic.

“I’ve been through some hard times, ‘29, ‘82, ‘85--they’re all dangerous,” he says. “But this doesn’t scare me. No, absolutely not. You figure out how much money you have and how much money you can afford to lose. I’m safe.”

This financial sage won’t even divulge his first name. “Here, if they find out you have money, you get 159 telephone calls in five minutes,” he cautions.

Gulshan Bhatia, an Indian immigrant known as Gus to the other members of the regular crowd, says that Monday’s market plunge cost him about $75,000 on paper, a loss that apparently has fueled his philosophic tendencies.

He sits back on an office couch, feet outstretched, wearing a bemused look on his face as he watches Rick, Don, Bob, Sidney, Peter and the others scratch their chins and furrow their brows over the machinations of the stock market.

“I’m not going to do a thing,” he says. “What can I do? If I sell, then my loss is real. I’ll wait till people come to their senses.

“(But) I accept the situation,” he continues. “This is a game of thieves. Thieves working within the guidelines of so-called law. They can steal money from you, and there is nothing you can do about it.

“It’s like when there is a disturbance,” he adds. “Some people come to help and some people come to loot. That’s what happened yesterday. They came to loot.”

But Gus, too, soon becomes impatient. He joins the crowd peering at the computer screen under the capable command of Sidney.

“Well, there goes your Exxon,” Sidney says to a face poking over her shoulder.

Cut to center left and enter Ahhas Namazi, otherwise known as the Iranian psychic, who proclaims to the crowd that “the crash is now.”

This does not appear to be news. Namazi, who emigrated from Iran nine years ago, plays the stock market full time. He looks like he could use some sleep.

“I can predict which way the market will go,” he says. “God tells me. That is as long as I’m not in it.” Others in the room second that opinion.

One of about 10 people who opened new Schwab accounts Tuesday is Michael Nicoli, 25, of Laguna Nigel, who plans to enter Cal State Long Beach in January. This will be his first stab at playing the stocks.

“I’m looking for a way to maximize my earnings,” he says, standing at the office counter dressed in shorts, a T-shirt and tennis shoes. He says he plans to get some bargains with his $5,000.

“There is no reason why a reasonably intelligent person can’t come up with some gains,” he says. “I don’t expect to make a mint. But in the end, I do hope to make more than I lose.”

The others in the room don’t hear him. An approximation of a sigh of relief is heard. The market is climbing, again.

Sam Sheikh, a Pakistani immigrant, finds a dime on the floor. He wonders aloud whether that is a sign of good luck.

Three people tell him it is. “Put it in your shoe,” one suggests.

Somebody is almost always hanging on the in-house phones now buying, not selling. The outside lines haven’t stopped blinking.

“I’m not laughing,” Faye Diliberto, a Schwab employee, tells a client as she answers one ring. “I’m hysterical.” To another caller she quips: “Aren’t you glad you aren’t working here today?”

But things aren’t looking too bad. More retirees from Leisure World, most of them in safer utilities, certificates of deposit and money market accounts, pop in to check on the action.

“At this stage of the game, one doesn’t speculate,” says Morton Zacks, 74, a retired women’s ready-to-wear retailer, who takes on a dignified tone as he separates himself from the younger, more speculative clients closer to the computer screens.

“We buy stocks for income, those with a fairly good return,” he says. “Here in Leisure World the big question is, what do you do with your money? That’s the question everybody’s asking.”

Peter, the graph maker, is nearing the end of his work of art. The market closes up 102.27 points, but not nearly enough of a gain to persuade the Schwab regulars to sell out for good.

“I still can’t afford to get out,” says Sidney. “I’ll just have to wait another day.”