In Encino, ‘Junk Bond’ King Is a Commoner

Michael Milken may well be the best known name on Wall Street. But on Ventura Boulevard, just a few blocks from his home, he’s something of a stranger.

In a highly unscientific survey last week, The Times queried 100 people in Encino, the San Fernando Valley suburb where Milken grew up and still lives today, and at Birmingham High School, where Milken graduated 25 years ago, to gauge how well known he is in his own back yard. People were picked at random in a telephone survey or asked to fill out a questionnaire in person.

Only one out of every three people surveyed could correctly identify the Drexel Burnham Lambert executive and philanthropist as the nation’s premier junk bondsman and subject of a huge federal stock fraud investigation.

And the rest? They listed Milken as everything from Encino’s mayor to heavyweight champ Mike Tyson’s divorce lawyer, a space shuttle astronaut, the new editor of The Times, inventor of the fax machine and a character out of the television series “thirtysomething.” Some confused him with New York developer Donald Trump, computer entrepreneur Steven P. Jobs and Walt Disney Co. Chairman Michael D. Eisner.

Business Lacks Celebrity

Because the survey was unscientific, definitive conclusions can’t be drawn from the results. Still, they suggest that Milken is far from a household name--even in his hometown.

“Somewhere I’ve read his name, but I don’t know of him. Is he an entertainer?” asked Alan Stein, a comic and producer at Encino’s L.A. Cabaret comedy club, whose response was typical.

Which isn’t surprising. Other, professional surveys indicate that business people aren’t nearly as well known as entertainers. According to Marketing Evaluations Inc., a Port Washington, N.Y., market research firm, the top celebrity in familiarity and appeal in most recent surveys was entertainer Bill Cosby with a 96% score, followed by actor Michael J. Fox at 90%. Chrysler Chairman Lee A. Iacocca scores about 71%, with Playboy founder Hugh Hefner at 67%.

Milken certainly isn’t lacking for publicity. A computer database survey of the nation’s largest newspapers, magazines and wire services showed that last year Milken’s name appeared in no fewer than 250 headlines. That doesn’t include countless other Milken-related stories on Drexel or others touched by Wall Street’s continuing insider trading scandal, such as imprisoned stock speculator Ivan F. Boesky.

Milken’s lack of recognition comes as no surprise to Kenneth Lerer, his personal spokesman. “Michael has said he has never sought the spotlight. He wants his kids to grow up in a very normal fashion,” Lerer said.

Despite the recent attention, it’s unlikely that Milken, 42, is even Encino’s most famous resident. That distinction probably goes to singer Michael Jackson, who reportedly plans to move to a ranch near Santa Barbara this spring but keep his Encino home.

$800-Million Fortune

Still, Milken is undoubtedly Encino’s wealthiest resident. Last year, Forbes magazine estimated his fortune at $800 million.

He got that way by creating the market for “junk bonds,” which are high-risk, high-yield debt securities. Believing that many good companies were shunned in financial markets, Milken from his Beverly Hills office built junk bonds into a market worth more than $160 billion, prompting some to call him the most important American financier since J. P. Morgan. But he also has become controversial, as junk bonds were used to fuel the ambitions of takeover specialists such as Revlon Chairman Ronald O. Perelman and TWA Chairman Carl C. Icahn.

Milken also is becoming increasingly known through his charitable empire. He and his wife donated $196 million to their three charitable foundations in 1987, according to recent state records. In addition, Milken has been seen increasingly at public events such as baseball games with disadvantaged youths he is helping.

Most of his notoriety, however, has come from being the target of a massive government stock fraud investigation. In September, the Securities and Exchange Commission accused him in a civil lawsuit of insider trading, manipulating stock prices and having an illegal stock trading arrangement with Boesky. Milken has denied the SEC charges. He is expected to be indicted soon in New York.

Despite the notoriety that came with the insider trading scandal, few of the 100 people queried last week knew any details about Milken’s predicament, even if they knew in general what he does for a living.

“I just know he’s in a lot of trouble,” said Henry Lipson, who has owned a pharmacy on Ventura Boulevard in Encino since 1955.

Encino’s Mayor?

The Encino survey was conducted in two parts. The first involved distributing questionnaires to 66 people along Encino’s main street, Ventura Boulevard, and at Birmingham High in Van Nuys. No one was told it was a newspaper survey. The questionnaires asked: “Who is Michael Milken?” and offered a choice of 20 answers.

Of the 66 responses, 21, or slightly less than a third, correctly identified Milken. The rate would have been lower had it not been for a group of students taking an accounting class at Birmingham, who presumably knew him because of their interest in business.

Some of the other results:

- 9% of the respondents picked Milken as Encino’s mayor. (Encino does not have its own mayor, except for the celebrities who serve as honorary ones, because it is part of the city of Los Angeles.)

- 8% identified him as Tyson’s divorce lawyer (Howard Weitzman is Tyson’s lawyer). Another 8% picked Milken as the county supervisor (Mike Antonovich) who was re-elected last fall over Baxter Ward. And 8% more thought Milken was The Times’ new editor (Shelby Coffey III is the new editor).

- 6% confused Milken with President-elect Bush’s choice to be Treasury secretary, Nicholas F. Brady.

- 5% said he was the New York real estate developer and Atlantic City, N.J., casino owner Donald Trump; another 5% though he was computer pioneer Jobs; still another 5% of those questioned thought Milken was a “thirtysomething” character.

- 3% said he was a crew member on the space shuttle Discovery. Another 3% answered that Milken was the inventor of the fax machine. And about 3% thought Milken was an unsuccessful Oscar nominee for best actor last year.

Hot Dog Man Knows Him

The other part of the survey involved asking 25 Encino residents, whose names were randomly selected from the telephone book, and nine local community or business leaders whether they could identify Milken.

He was easily identified by Steve Edwards, a Los Angeles talk-show host who serves this year as Encino’s honorary mayor, and Jan Sobel, executive director of the Encino Chamber of Commerce. Larry Buck, who sells hot dogs from a cart at Encino Park near Milken’s home, was also successful.

But others stumbled. Postmaster Barry Seltzer said he could not identify Milken. Also having trouble was Mark Wilson, a professional magician who this year is Encino’s honorary sheriff.

Milken is largely a stranger today at Birmingham High, where in 1964 he practiced high-yield pep as head cheerleader (along with actress Sally Field), was named prom king and served as a member of the Boys League service organization with Michael Ovitz, who would go on to become a Hollywood superagent as head of Creative Artists Agency.