Abby Joseph Cohen.
(PHOTO: Courtesy of Abby Joseph Cohen)
By Nancy A. Ruhling
The woman Wall Street always drops everything to listen to is dressed in her trademark conservative suit and gazing out the window of her Goldman Sachs office in Lower Manhattan as if she’s seeing the view for the first time. She points out the Statue of Liberty and Ellis Island; they appear almost close enough to touch and offer a poignant link to her family’s history. "This is an incredible view," Abby Joseph Cohen says. "It’s even more special to me because my grandparents and mother fled Poland and came through Ellis Island. This view is a regular reminder to me that, but for that…."
The voice, as broad and flat as a Midwestern cornfield, is that of a mother calming a child who has fallen and scraped his knee. Most of her mother’s family was killed in the Holocaust, she continues; her father’s made it to America earlier. She has been to Ellis Island twice and found it "very striking, imagining her family’s sense of relief and nervous anticipation when they arrived."
Her family history is not what we are used to hearing Cohen discuss; it is unlike the legendary market guru’s economics commentary on PBS, CNN, CNBC, and a host of other networks that we have come to count on as the bears-paws down-and the bulls- horns up-play their tug-of-war in the middle of the Street.
Cohen’s voice of reason is well known for sounding loud and clear calls to investors that often go against consensus views, bullish and bearish. Her influence was seen, for example, on November 15, 1996. The Dow Jones Industrial Average was up 65 points before a rumor that Cohen was going to change from bull to bear roared through the Street. The Dow was down 60 points, a swing of more than 2% in less than 30 minutes, by the time Cohen got on the firm’s worldwide communications system to reassure Goldman Sachs traders that she was indeed staying the bullish course. After she spoke, the market rose to the occasion and ended the day up 35 points.
The biggest bull on Wall Street. The prophet of Wall Street. The most influential market forecaster ever. The Empress of the Markets in China and the Good Fairy in France. The 54-year-old Cohen has, at one time or another, found herself the wearer of all these titles. The truth is, she’s not exactly comfortable with the kudos.
"I love the challenge of the market. It has so many moving pieces, and I’m told I’m pretty good at it," she says modestly, considerately asking whether she is speaking too quickly for the interview. "My track record has been good and far more consistent than is typical in the industry. I proudly recall that Louis Rukeyser frequently referred to me as the most accurate market strategist."
But you won’t find her gazing into a crystal ball. During the 12- to 14-hour days and six-day weeks she puts in as the chief U.S. investment strategist for Goldman Sachs, there’s not time for that.
"A key to the successful record of my analyses and research has been the long-term focus. I consciously avoid short-term forecasts, which can get caught up in market noise," she says.
"Typically, I look out six to 12 months or even longer. There’s no way to do this without detailed and conscientious work. It may not be glitzy, but I study the data, digging into details that many people prefer to ignore. In the 1990s, for example, there was a presumption by many that inflation would worsen and, as a result, there were fears that interest rates would rise, triggering another recession. We studied the underlying economic data carefully,and we didn’t agree. The general perception wasn’t correct."
Cohen, who heads a 10-person team, meets with clients around the world, including institutional investors, leading corporations, and government officials, providing insight on trends in the economy and capital markets. Her frequent travel, often exceeding 100 days each year, takes her around the globe. This year found her at meetings in Hong Kong, China, Japan, Australia, the Middle East, and several European countries.
"Goldman Sachs is a global firm," she says. "Our clients are based all over the world, and most have a keen interest in the United States, the world’s largest economy with the largest financial markets. Clients are interested in my views, and I am eager to know what they are thinking, too. It is an honor to work with government leaders, addressing issues ranging from economic development to market regulation."
The 12-hour days don’t faze her because she finds her work "an incredible intellectual challenge and an opportunity to engage with some of the most thoughtful and influential people around the world."
Unlike many of her peers who have made it big, Cohen doesn’t seek the limelight. She’s not glamorous or flashy. She doesn’t live in Manhattan; she doesn’t have a country home in Greenwich, and she doesn’t wear diamonds the size of the Ritz. She lives in the middle-class community where she grew up, is still married to her first husband-who just happens to have been her college sweetheart-and when she does wear jewelry, she favors a sedate antique gold chain inherited from her mother.
Cohen also doesn’t rest upon her laurels; she doesn’t like to talk about her accomplishments. She has been the recipient of a slew of honors and accolades and has been recognized for more than a decade as a leader in U.S. portfolio strategy by Institutional Investor magazine and Greenwich Associates. A Goldman Sachs partner since 1998, she was ranked No. 19 among Forbes’ Most Powerful Women in 2005, has made the cover of BusinessWeek, has been profiled in the New Yorker and the New York Times, and her career was the subject of a Harvard Business School case study. And it was she who coined the term "Silly Putty economy" in the early 1990s.
The story of how that came about is typical of Cohen’s down-to-earth approach to economics and is a prime example of how she has managed to juggle the twin balls of career and family with ease. She was working at home, which she does every Sunday, and her younger daughter had left some of the pliable stuff near her desk. Cohen started playing with it and drew on it an S-curve to represent the standard boom-and-bust business cycle. She then stretched it horizontally and realized that it became a good picture of the future economy-a less exuberant but longer-lasting economic expansion, accompanied by a bull market with less price volatility than usual.
"I am delighted and flattered to have such a visible position," she says. "Helping investors and others properly analyze difficult economic situations is a great challenge. In the past, I’ve been able to parse through complex situations, especially when there are major structural changes, and to concisely describe the new reality, identifying investment opportunities. I love to explain complicated matters, simply but accurately."
It was somewhat of a surprise, especially to Cohen, that she even ended up in the financial markets. She started out as a physics major, then became interested in economics and the then-emerging field of computer science, which were dominated by men. Her first job was working for the research division of the Federal Reserve
Board in Washington. Her financial markets career path started at T. Rowe Price Associates and included a stint at Drexel Burnham Lambert Inc. She has been making her mark at Goldman Sachs since 1990.
Despite her crammed calendar, Cohen makes time for several nonprofits. She is a presidential councillor at Cornell University, where she earned her bachelor’s degree at a time when few of the Ivy League schools were open to women; is on the boards of the Weill Medical College of Cornell and The Jewish Theological Seminary, and sits on the investment committees of The Museum of Modern Art and Cornell University. She and her husband, labor lawyer David Cohen, are actively involved in Hillel: The Foundation for Jewish Campus Life-he is a vice-chair of its international board of directors; she serves on its international board of governors.
"These are my hobbies," she says. "My volunteer work takes up a good deal of time, but I’m able to keep up with my professional responsibilities at Goldman Sachs through focus and heavy usage of mobile computing, my ‘electronic tether.’ It is important for skilled people in other fields to become involved with nonprofits and not just from a funding standpoint. Many worthwhile organizations also need leadership and direction and benefit enormously from application of the same skills that drive success in the private sector."
Her work for The Jewish Theological Seminary satisfies her "overall interest in higher education. But this institution also plays an important role in the wider Jewish community, allowing a layperson like me to make a contribution."
The seminary, she says, "plays an important role in the future of the Jewish community as the training ground for the next generation of leaders-not just rabbis and cantors but also academic scholars and lay leaders."
Hillel honors International Board of Governors members Abby Joseph Cohen and David M. Cohen at a gala dinner. (l-r) David Cohen, Avraham Infeld, Abby Joseph Cohen, Hillel President Wayne L. Firestone and Harold Tanner.
Involvement with Hillel, she maintains, helps the younger generation of Jews, like her two daughters, "to identify as Jews not only in a religious way but also in a social and cultural way. Hillel has found an incredible niche market, that is, the future generation, and Hillel has a terrific product to sell."
Hillel’s skyrocketing membership numbers in the United States and elsewhere show that there’s "an enormous opportunity and interest on campuses to become involved in community service and social activities, and to demonstrate leadership within the rest of the university community. The young people who join Hillel don’t want to ‘bowl alone,’ to use the phrase from Robert Putnam’s book. Instead, they have interests and passions that bring them together."
Cohen, who still is close to the Conservative synagogue in which she was raised, says that "Judaism is an important part of who I am, and it is an essential element for my family. It helps define who we are, where we came from, and what we hold dear."
Reprinted with permission from Lifestyles Magazine.