He was a Wall Street titan on his way up, and so ruthless he scared even his fellow tycoons. If anyone crossed him, he said one night at dinner with friends, he would rip the guy’s heart out with his bare hands. The businessman across the table visibly blanched.

Soon, the titan would discard old friends who were not rich or connected enough for the life he coveted. And he got it all—the top job, the hundreds of millions of dollars, the lavish homes with eight-figure price tags, the museum-worthy art collection.

Now his company lies in ruins, and his name is synonymous with greed, arrogance, and bad judgment. Yet his enemies couldn’t even gloat; the cost of his comeuppance was too great. As he and his counterparts drove major institutions into a death spiral, they took much of the world as we knew it down with them. The entire global culture was instantly transformed.

“There was a lot of schadenfreude as the Europeans jumped up and down saying, ‘Look what’s happening to the Americans and the Brits!’ ” said Andrew Hilton, director of London’s Centre for the Study of Financial Innovation, after the worst week in Wall Street history. “And then, suddenly, the Europeans realized they were going to get it too.”

On the harrowing October Friday that will henceforth be known as the wildest day the market has ever seen, a Connecticut hedge fund manager wandered around Greenwich, stunned. “It’s game over for me,” he admitted. “The truth is, I’m out of business. This is an utter debacle. I’ve been doing this for 37 years, and none of us has ever seen anything like this. There’s a lot of big ego involved in my business; it’s about feeling smart. There’s an old cliché: Never confuse brains with a bull market. But it’s hard not to flagellate yourself when things unravel. Everyone’s very humbled.”

So much of the smart money had gotten it wrong. The damage was so horrific; the ensuing volatility was so terrifying. Even the most venerated names were tarnished, from Alan Greenspan to Hank Paulson. Younger bankers were particularly shell-shocked; the extreme hubris and over-the-top decadence of recent years were the only norms they had ever known.

“I was at Voile Rouge in Saint-Tropez one night,” a 32-year-old American recalls, “when these Russian oligarchs were shaking bottles of vintage Cristal that cost thousands of euros and spraying the crowd with it. Then a bunch of Americans did it with some 300-euro Dom Pérignon, and they were booed.”

As the climax approached, the feeding frenzy often seemed like the last throes of a doomed empire choking on its own hubris. Hedge fund investors were already chafing at managers’ steep 2-and-20 (and 3-and-30) fee structures when SAC Capital’s Steve Cohen shocked them with his 50 percent performance fee. The $34,000-a-night hotel rooms, the $175 gold-dusted Richard Nouveau hamburger at the Wall Street Burger Shoppe, the Algonquin Hotel’s $10,000 martini on the rock (the rock in question: a jeweler-selected diamond): Conspicuous consumption didn’t even begin to describe the you’re-not-going-to-believe-this lifestyle and work habits of the rapacious übercapitalists who were replicating all over the world.

“Excess isn’t just an American phenomenon,” Hilton says. “In the U.K., there was the same envy of the people in the financial sector who were having those £25,000 lunches and dinners. They absolutely did think they were smarter than anyone else.”

How things change! “These days, you ask professional money managers what their performance goals for the end of the year are,” one young institutional equity salesman says, “and they say, ‘This year’s goal is employment.’ ”

For those who measure their self-worth by their net worth, sorting out the psychological toll can be excruciating, as a 60-year-old portfolio manager realized when he asked an old friend how he was doing. “He said, ‘I’m great; my money is terrible.’ That is such a sensible way to feel—but it’s so hard to distinguish between the two.”

And yet for every highflier who is chastened, another would-be mogul pops up elsewhere, convinced he’s smart enough to game the system. “On the day the House voted against the financial rescue plan,” the portfolio manager says, “I was in Shanghai, where there’s this huge building boom and all these Chinese Donald Trumps running around, all of them like, ‘My penis is bigger than yours.’ ”

Like a lethal virus, it seems, hubris never really disappears—it simply finds a new host.

“When things are very good, people take ridiculous risks, and then things come crashing down and the risk just moves somewhere else,” the brash young equity salesman concludes with a feral grin. “What we saw in London is moving to the Middle East—just look at Dubai. We don’t know where it’s going next, but someone will be making money somewhere.”