Elizabeth Warren is winning grudging respect among some on Wall Street

Sen. Elizabeth Warren (D-Mass.) questions witnesses during a Senate Banking, Housing and Urban Affairs Committee hearing on Wall Street reforms in 2013.
Sen. Elizabeth Warren (D-Mass.) questions witnesses during a Senate Banking, Housing and Urban Affairs Committee hearing on Wall Street reforms in 2013.
(Drew Angerer / Getty Images)

There’s a new whisper on Wall Street — maybe Elizabeth Warren isn’t so bad.

The Democratic senator, who rose to national prominence by calling for tough regulation after the financial crisis, is winning respect from a small but growing circle of senior bankers and hedge fund managers. As the presidential candidate from Massachusetts takes aim at the “rich and powerful” with a slew of tax-raising policy proposals, some financial types who fit that description say she’s proven capable and makes some good points.

“If she ends up being the nominee, I’d have no trouble supporting her at all,” said David Schamis, chief investment officer of Atlas Merchant Capital, where he’s a founding partner alongside former Barclays Plc head Bob Diamond. While Warren isn’t Schamis’ top choice, he said: “I think she is smart, hardworking, responsible and thoughtful. And I think she thinks markets are important.”

Schamis said people in his network who studied under Warren, a former professor at Harvard Law School, think highly of her, including some conservatives.


Warren emerged early as one of the strongest contenders for the Democratic presidential nomination, and she’s been generating buzz in recent weeks with detailed policy proposals and a well-regarded performance in the first major debate. A CNN poll taken after the two nights of debates and released Monday showed her in third place among Democrats with 15%, an increase of eight points since a poll from the cable network in May. Former Vice President Joe Biden drew 22% and Sen. Kamala Harris of California 17%.

For some Wall Streeters who lean liberal, Warren is an acceptable alternative to candidates who trigger their most visceral objections: President Trump on the right and Sen. Bernie Sanders (I-Vt.), a self-described democratic socialist, on the left.

It would be “just wrong,” Warren told CBS’ “Face the Nation” in March, to call her a democratic socialist: “I believe in markets. Markets that work. Markets that have a cop on the beat and have real rules and everybody follows them.”

At other times, she has derided parts of the financial industry as predatory.

“I clearly don’t agree with everything she says, but I do give her credit for getting things done,” Tom Nides, a Morgan Stanley vice chairman and former deputy secretary of State under President Obama, said of Warren. He didn’t share which candidate he’s supporting.

Warren’s work to set up the Consumer Financial Protection Bureau in the wake of the crisis was “impressive,” Nides said. “You can’t argue with that. Having an idea, driving it to fruition, and having set it up is really hard to do.”

I agree with her general assessment that we’ve allowed multiple systems to develop in this country that screw average folks in countless ways.

— Former hedge fund manager Whitney Tilson


Some who like Warren might find that their backing isn’t welcome. Former hedge fund manager Whitney Tilson recounted a 2016 episode in which she criticized him on Facebook for being a Wall Street insider who stood to gain from Trump’s policies. The attack surprised Tilson and his wife, who had previously made small donations to Warren and followed her career. She later apologized.

“I agree with her general assessment that we’ve allowed multiple systems to develop in this country that screw average folks in countless ways, from education, healthcare, criminal justice, trade, etc.,” Tilson wrote in an article last week. Despite the mishap, “I’m glad she’s running.”

More than a half-dozen other members of the industry agreed to discuss their warming views of Warren on the condition they not be named — underscoring the potential pressure they could face from associates for embracing someone who derides their business.

Indeed, Schamis and others were unwilling to commit to any candidate this early — either with their vote or their money. (His business partner, Diamond, previously donated to campaigns for Republicans John McCain and Jeb Bush.)

Some said Warren certainly won’t be their first choice in the primary, though they could imagine supporting her in the general election. In addition to Biden and Harris, Wall Street executives have shown interest in candidates including Pete Buttigieg, the mayor of South Bend, Ind., and Sen. Cory Booker (D-N.J.).

Those drawn to Warren cited her intelligence and stance on social issues. They expressed sympathy for her calls to bolster regulation after the financial crisis, within reason, and for her concerns about income inequality. There are worries among the Wall Streeters that if the wealth gaps keep growing it will trigger a more radical backlash — what they ominously called the pitchforks. Yet that doesn’t mean they support her proposal for a wealth tax.


And some privately predicted she will shift to the center if she becomes the nominee.

Openness toward Warren may signal a change from just three years ago, when powerful Democrats in the financial industry sought to block her potential rise to the White House. In mid-2016, a dozen major donors from Wall Street warned in interviews with Politico that they wouldn’t give money to Hillary Clinton’s presidential campaign if she chose Warren as her running mate. Donors feared Warren would push Clinton too far to the left and harm the economy. Clinton ended up selecting Virginia Sen. Tim Kaine. They lost to Trump.

JPMorgan Chase Chief Exectutive Jamie Dimon arrives to testify before a Senate Banking Committee hearing in 2012.
(Mark Wilson / Getty Images)

Wall Streeters’ views have proven adaptable over the years. Some like to think of themselves as savvy investors in politics, able to bet early on the next big thing. At least a few prominent financiers are known to trade stories about how early they backed Barack Obama in the 2008 presidential race. Sometimes support is a calculated move. Even donors who backed Clinton later gave to Trump’s inauguration.

Yet Warren’s criticism of the industry has at times flared into direct clashes with its most prominent leaders. Her book “A Fighting Chance” describes a heated discussion about regulation with JPMorgan Chase & Co. Chief Executive Jamie Dimon during an encounter in 2013: “We weren’t quite shouting, but we were definitely raising our voices.”

Dimon later echoed the views of many in finance at an industry event in 2015: “I don’t know if she fully understands the global banking system.”

Warren shot back: “The problem for these guys is that I fully understand the system and I understand how they make their money, and that’s what they don’t like about me.”


Despite that exchange, Dimon and Warren have met a few times and the visits went well, according to a person with knowledge of the talks who asked not to be identified describing private meetings. In recent years, Dimon has also expressed concerns about many of the same issues Warren prioritizes, such as income inequality, stagnant wages and soaring healthcare costs.

Yet there’s no truce: Last week, she took aim at JPMorgan for reviving a policy pushing credit card customers to use arbitration to resolve disputes. In a letter, she urged the bank to “reconsider your plans to resume exploiting its customers.”

Warren has no plans to ease off the industry. “Nobody has been tougher on Wall Street than Elizabeth — and no one will be tougher on Wall Street as president than Elizabeth will be,” the campaign said in an emailed statement. “She wants to break up the big banks.”

A representative for JPMorgan declined to comment.

The industry has good reason to worry about Warren’s ability to inflict pain. In 2016, she led calls to fire Wells Fargo & Co. CEO John Stumpf after the bank opened accounts without customer permission. Then she demanded the ouster of his successor, company veteran Tim Sloan, saying he couldn’t be trusted to clean up its scandals. After regulators signaled dissatisfaction with his progress, he stepped down in March, saying he didn’t want to be a distraction. The bank is seeking an outsider to take over.

Wall Street’s view of Warren has shifted throughout her political career.

Despite her steady criticism of the industry, Warren raised $625,025 from donors who work in the investment and securities firms for her 2012 Senate campaign, according to data from the Center for Responsive Politics. Financiers were more comfortable with Democrats then, and probably saw her as less of a threat, said Jeffrey Berry, a political science professor at Tufts University. But that likely changed during her first term as she established herself as one of Capitol Hill’s fiercest critics of the industry.

For her 2018 reelection bid, she drew $387,417 from the sector. To be sure, some backers may have felt less inclined to contribute because she was fending off an underfunded and a much weaker opponent. Though she got $53,760 from the sector in the first quarter, it’s too early to project what she might raise for her presidential bid.


Over the years, her views have become more accepted, Berry said.

“There is an increasing sense among the highly educated that the system is out of whack in terms of income inequality and so people who work with money day in and day out are acutely aware of that,” he said. “Her indictment of income inequality and the role that Wall Street plays in that is becoming more mainstream.”