‘10 Surprises’ strategist Byron Wien dies at 90

Byron Wien, the longtime market strategist whose annual list of “10 Surprises” made him one of the most influential voices on Wall Street during a career at Blackstone Inc. and Morgan Stanley, died Wednesday. He was 90.

Wien was at Blackstone for the past 14 years and was most recently a vice chairman in the private wealth business, serving as a prognosticator of markets for the firm and its investors.

“Byron’s life was remarkable in so many ways,” Blackstone Chief Executive Steve Schwarzman and President Jon Gray said in a memo circulated at the firm. “He was always building new relationships and pushed everyone around him to think about the risks and opportunities that lay ahead.”

Orphaned as a teenager, the Chicago-born Wien overcame a hard-luck youth to become a household name in finance with a career spanning more than 50 years. He began publishing his predictions in 1986, when he was chief U.S. investment strategist at Morgan Stanley. The list quickly became a must-read, focusing as it did on seemingly low-probability outcomes on topics such as the direction of the S&P 500 Index, China’s economic growth and the next US president.

His formula was simple but provocative: Look at things an average investor would give a 1-in-3 chance of happening but that (to Wien) had a better than 50% likelihood of occurring. While oftentimes off-the-mark, his forecasts nonetheless were widely followed year in and year out and had the force to move financial markets.

LITTLE DOWNSIDE

“The great thing about Byron’s picks — and I’ve followed Byron for 30 years ... is when he’s wrong, it really doesn’t cost you anything,” stock picker Jim Cramer said on CNBC’s "Squawk on the Street" when Wien announced his surprises for 2018. “When he’s right, you can make a fortune.”

Wien continued the tradition throughout his career. In 2009, following a stint at Pequot Capital Management Inc., he joined Blackstone to advise the firm and its clients in analyzing economic, political, market and social trends. 

Wien, who came up with the list to distinguish himself from other investment strategists, said Morgan Stanley initially had deep reservations about the idea.

AVOID EMBARRASSMENT

“They said, ‘Byron, you could get all 10 wrong and you would embarrass the firm and humiliate yourself. Frankly, we don’t give a damn about your humiliation, but we don’t want the firm to be embarrassed,’” Wien recalled in a profile.

His predictions had a mixed record of success. Many times, a majority of his forecasts were spot-on. But there were also a number of notable flubs. In January 2016, Wien thought Hillary Clinton would become president in the election later that year — and that her opponent would be Texas Sen. Ted Cruz rather than Donald Trump.

But in some ways, keeping score was beside the point. Even when he was wrong, Wien had the power to provoke and influence Wall Street. In 2002, he said then-Federal Reserve Chairman Alan Greenspan would likely retire, something that didn’t come to pass until 2006. Still, Wien’s prediction moved markets and spawned a number of articles about whether Greenspan would, or would not, step down.

“I had a string of years, ’93, ’94 and ’95, where I got seven out of the 10 right,” he told Bloomberg. “And usually I get five or six right. But I don’t do it for score. I do it to stretch people’s thinking.”

Wien’s writing gave Blackstone a following among financial advisers and wealthy people. Over the past decade, the world’s largest alternative asset manager has extended its reach beyond big pensions and endowments and now invests for a broad swath of individuals. 

LUCKY BREAK

Byron Richard Wien was born on Feb. 14, 1933. His father, a doctor, died when Wien was 9. His mother died when he was 14, and her sister raised him while he finished high school on Chicago’s north side.

Wien described himself as a “nerdy middle-class Jewish kid.” He said he caught a lucky break when his guidance counselor told him Harvard University was looking for smart kids from public schools to balance out their private school enrollees, and had asked for one student for an interview with a visiting admissions officer.

“The guidance counselor called me in and said, ‘Wien’ — they called you by your last name then — ‘you’re our pick. Go downtown and don’t make a fool of yourself.’ That changed my life,” Wien recounted in Barron’s many years later.

NIGERIA VISIT

After getting a bachelor’s degree with a major in physics and chemistry, he went on to earn a master of business administration at Harvard Business School.

Initially, he worked for an advertising agency in Chicago but didn’t like it. Then he served two years in the Army before taking a consulting job that sent him to Nigeria, which he credits for spurring his lifelong interest in traveling and the developing world.

In the mid-1960s, Wien moved to New York, where he was offered a job at a small investment management firm by a business school classmate. Initially, it didn’t go well. By his own telling, he lacked the training to be an analyst and was almost fired. But soon, Wien found his way and ultimately became a partner at the firm.

In 1985 he moved to New York-based Morgan Stanley, where he stayed for 21 years. He made his reputation there not just for his annual list but for his popular monthly strategy essay.

LIFETIME ACHIEVEMENT

First Call named him the most widely read analyst in 1998. Smart Money ranked him the No. 1 strategist two years later, and New York magazine called Wien one of the 16 most influential people on Wall Street in 2006. He received a lifetime achievement award from the New York Society of Security Analysts.

At Blackstone, which he joined in 2009, Wien traveled extensively around the world to meet with investors, government officials and central bankers.

Wien was a regular commentator on financial media and was loath to miss the firm’s global Monday morning meeting. A relentless networker, he also organized a series of lunches in the Hamptons each summer to discuss markets, politics and the economy.

The market strategist never shied from tough debates. At past investor meetings, he squared off with Tony James, a top executive who played a key role running the firm back then, in a spirited exchange of ideas. Those debates played out on stage, leaving the audience taken aback when neither man would back down, according to Joan Solotar, who leads Blackstone’s private wealth solutions business. 

“Byron could be a bit relentless” but never entered a debate with anyone with an attitude of “I’m right, you’re wrong,” she said. And he bolstered his arguments with facts.

“He understood you can’t predict where an interest rate or market will be,” Solotar said. “But you can look at the facts presented and do the analysis, and aim for a better than 50% chance.” 

LIFE LESSONS

Wien published a list of 20 lessons learned over the course of the first 80 years of his life. They included: travel extensively, read all the time and network intensely.

The last one, characteristically, was to never retire. As Wien put it: “If you work forever, you can live forever. I know there is an abundance of biological evidence against this theory, but I’m going with it anyway.”

In recent years, he worked with his successor. Joe Zidle, chief investment strategist at Blackstone’s private wealth solutions business, joined Wien in formulating the “10 Surprises” in 2018. This year, they predicted the market would bottom by midyear and begin a recovery comparable to 2009. The duo made another prediction: “Elon Musk gets Twitter back on the path to recovery by the end of the year.”

Wien was married twice. After his first marriage, to a school teacher, ended in divorce, he married Anita Volz, chairwoman of the Observatory Group, a macroeconomic consulting firm based in New York.