Washington Post reporter Brooke Masters, author ofSpoiling for a Fight: The Rise of Eliot Spitzer, a biography of New York Attorney General Eliot Spitzer,recently spoke with Fool contributor Tim Beyers. Read on to find out what she has to say about Spitzer's view of the stock market, mutual funds, and the New York gubernatorial race. This interview has been edited for length and clarity.
Tim Beyers: Brooke, thanks for making time. Let's start with a softball: Can you handicap the New York gubernatorial race for us?
Brooke Masters: It is very clearly Spitzer's to lose. His foe in the general election, a guy named John Faso, used to be a leader of the Senate. I'm sorry, the minority leader of the Senate has very little money compared to Spitzer, and his polling numbers are pretty abysmal.
Unless Spitzer does something really, really dumb, I think it is pretty much over.
Tim Beyers: You graduated from Harvard in '89 and then earned a degree in economic history from the London School of Economics. Can you tell us a little about that? How do you get a degree in economic history? What do you learn?
Brooke Masters: Sure. I went to the London School of Economics about five years into my reporting career. I took the part of economic history that focuses on what they called the less-developed countries, which we would call the Third World, though that is considered condescending.
Tim Beyers: Let's move on to the Street itself. When did you start covering Wall Street and what was it like then compared to how it is now?
Brooke Masters: I was brought in to cover Wall Street and white-collar crime and securities regulations right as WorldCom collapsed in the middle of 2002. I came in as a courts reporter. I had been covering criminal justice in the federal court system for five years, and they realized at The Washington Post that we needed someone who really understood how the court system and the investigative process worked. They needed somebody like that to follow all the cases that would come. I covered not only WorldCom with Bernie Ebbers but also Frank Quattrone's numerous trials as well as Martha Stewart and then all of Eliot Spitzer's various adventures on Wall Street.
Tim Beyers: What drew you to Spitzer? He is a very interesting character, as you point out in your book.
Brooke Masters: Well first of all, just his sheer activity. He did so many different things in so many different places, and I ended up covering them all because The Washington Post has a very small bureau in New York. Every time he called a press conference, I had to decide whether or not to go and cover it.
What I actually found most intriguing about him is that, as I covered him, I started to feel like I had heard the complaints about him before. You know, he is overstepping his bounds, he is doing things that the Federal government ought to be doing, he is a populist. He reminded me of stuff I had done at Harvard where I studied the Progressive movement with people like Teddy Roosevelt, who is obviously an icon now, but was controversial at the time, and Louis Brandeis, who later became a member of the Supreme Court, but was initially a crusading lawyer who went after big government.
The criticisms that were made of the Progressives back then were very similar to the criticisms of Spitzer today. I thought there might be an interesting historical parallel here. Are we seeing the birth of a new movement? I don't know that we are, but that is what got me into looking at Spitzer as more than just an interesting guy. He is an interesting guy, but he may also be the face of something larger.
Tim Beyers: Let's move on to talking about mutual funds. Spitzer is most famous in Fooldom for cracking down on the practice of illegal late trading. I am curious to understand whether or not he thinks there is more work to be done in the industry? Does it need a lot more cleaning up, or should fund investors once again be looking at Janus (NYSE: JNS ) , FranklinResources (NYSE: BEN ) , and the other late trading offenders?
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Fool contributor Tim Beyers understands a progressive view of history is sometimes necessary. But he also thinks the Democratic mutual fund is just about the goofiest thing he's ever seen. Tim didn't own shares in any of the companies mentioned in this story at the time of publication. The Motley Fool's disclosure policy is as progressive as it gets.