"what Wall Street sells is less like engineering than like a forecasting service for a coin-flipping contest" http://t.co/MW3Ro2VBcK
— Eric Scott Hunsader (@nanexllc) September 25, 2014
Via Noah Smith, Michael Lewis on the “Occupational Hazards of Working on Wall Street“:
… Technology entrepreneurship will never have the power to displace big Wall Street banks in the central nervous system of America’s youth, in part because tech entrepreneurship requires the practitioner to have an original idea, or at least to know something about computers, but also because entrepreneurship doesn’t offer the sort of people who wind up at elite universities what a lot of them obviously crave: status certainty.
“I’m going to Goldman,” is still about as close as it gets in the real world to “I’m going to Harvard,” at least for the fiercely ambitious young person who is ambitious to do nothing in particular…
You may think you are going to work for Credit Suisse or Barclays, and will there join a team of professionals committed to the success of your bank, but you will soon realize that your employer is mostly just a shell for the individual ambitions of the people who inhabit it. The primary relationship of most people in big finance is not to their employer but to their market. This simple fact resolves many great Wall Street mysteries…
..[T]he people who work inside the big Wall Street firms have no serious stake in the long-term fates of their firms. If the place blows up they can always do what they are doing at some other firm — so long as they have maintained their stature in their market. The quickest way to lose that stature is to alienate the other people in it. When you see others in your market doing stuff at the expense of the broader society, your first reaction, at least early in your career, might be to call them out, but your considered reaction will be to keep mum about it…
“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” — Adam Smith, The Wealth of Nations
Skerry
Wall Street criminals. No moral compass.
Kid is home safe. I’m going to try to sleep. Night, all.
Major Major Major Major
Pretty much. I have very little respect for most of the folks I know who work in finance, even if they live in communes and swear they “want to leave the industry but just can’t right now”.
srv
Vampires are complex creatures. Michael’s own book, The Big Short, the Deutsche Bank guy was fine watching the rest of the empire self immolate. One side of Goldman was taking swaps out on the other side.
For all the smarts on Wall Street, the whole point is that only a few (and even fewer outsiders) were living outside the reality distortion bubble.
lamh36
Ugh…it never fuckin’ ends.
Yep, We Need Dashcams
IT.NEVER.FUCKIN.ENDS.
lamh36
Gonna watch some Golden Girls to cleanse my soul so I can actually have a peaceful mind so i can sleep.
I’m a Black female, but I have a young nephew and male cousins and male godchildren who I just worry for them daily.
Ugh, thank gawd I dont’ have children of my own…
Ugh
fleeting expletive
That last thread was seriously good. Well done!
KG
Wall Street is Vegas with either more or less blow and more or less strippers. Finance guys are gamblers but not as honest about it as the guys who play cards or bet sports. Basically they’re bigger degenerates because they either don’t know, don’t care, both, or worse case scenario think they’ve beaten the system. And following the cluster fuck that was the last bubble, we are now staking their bankroll. Which always ends well
Bob In Portland
“Network Of Death.” Wasn’t that the name of an early Richard Thompson song?
suzanne
So Phoenix just got an alternative radio station this week. Our longtime station, Edge, switched formats two years ago and we hadn’t had a dedicated alt station. They’ve been playing a nice mix of new and old, but I’ve heard that ridiculous “King Without A Crown” song by Matisyahu from approximately 2006. I hate that song. I hated it when it came out. I was dating a dude who liked that song a lot, and I remember that that fact lowered my opinion of him,
Major Major Major Major
Watching 20 Feet From Stardom right now, fun movie. Gonna stream the new Leonard Cohen album next.
Mandalay
Speaking of lies and deception, Chris Hayes interviewed Jen Psaki from DoS about the legality of incursions into Syria on his show last night:
So Psaki was just spewing one absurd lie after another, claiming that Article 51 somehow entitled the US to drop bombs in Syria, because Assad was “unwilling” to go after ISIL.
Well this was Chris’s golden moment. He’d allowed Psaki to spew her deranged talking points long enough, and he pounced! He directly told Psaki that everything she had just said was a pile of steaming crap, and you’d have to be a complete idiot, or a liar, or both, to believe a word of the garbage she had just spewed. Psaki removed her mike and stormed off the set.
Juuuuuuust kidding! Hayes sat there like a good little schoolboy as she poured that bucket of soggy bullshit over his head and nothing more was said. Mission accomplished on both sides!
Hayes surely earned the right to be inducted into the Villager Hall of Compliant Doormats tonight.
RobertDSC (Quad Intel Mac)
Glad my Dodgers clinched tonight against the hated Giants. Very happy.
MattF
Hadn’t known that Lewis is writing for Bloomberg. Good for both of them.
jl
@lamh36: I watched the video until the poor guy tried to follow the officer’s order and then stopped it. Not sure I can bear to watch the rest. Hideous story.
Edit: I guess the new crime will be trying to follow police orders while black? Or Hispanic, or whatever don’t look quite White, er… I guess I meant ‘right’, right?
Citizen Alan
The more quotes from Adam Smith I come across, the more I think he would be closer to Elizabeth Warren than anyone in the Republican Party if he were alive today.
Chris
It really is the new aristocracy.
Villago Delenda Est
Adam Smith had these parasites nailed over two centuries ago. They claim to revere him, but it’s obvious they never read his fuckin’ book, because in a very genteel 18th Century way, it’s clear he holds them in utter contempt.
Chris
@Citizen Alan:
Oh, absolutely. Adam Smith is up there with Jesus and the Founding Fathers in terms of people whose loudest and proudest “followers” neither know nor care what they actually said and did, but love to invoke their name as a shibboleth. (He’s just not the iconic character these other ones were).
I’ve never tried this myself, but a couple years ago someone here kept recommending this as entertainment: find yourself a right wing blog, troll their comments section with quotes from Adam Smith, then sit back and count the number of times they call you a communist or a socialist. I can well believe it.
Villago Delenda Est
@Chris: What is VERY hilarious is to quote Marx quoting Adam Smith, tell them it’s a quote from Marx, and then wait for their haids to kerplode when you do the reveal.
Chris
@KG:
I wonder whether America’s Mafia kingpins (the kind that were instrumental in setting up Vegas) ever sit up at night thinking they wasted their life, and that if they’d just gone to business school and from there into banking, they could be running bigger cons and rackets than they ever did in the underworld. All with the full support of Good Society and none of those pesky gang wars.
Vito was thinking small with the whole “Senator Corleone, Governor Corleone” thing – Hedge Fund Manager Corleone, now there’s something that would’ve been worth it.
Chris
@Villago Delenda Est:
Was that you recommending the Adam Smith trolling as a pastime? If so, thank you. Still haven’t tried it, but it’s on the bucket list.
Cervantes
@Citizen Alan: You should read him directly.
Cervantes
@Villago Delenda Est: That does sound like fun — if only I had the time.
Citizen_X
Or in other words, the douchebag.
C.V Danes
People do indeed have a character that endures, and Wall Street attracts those whose enduring character has been molded by Ivy League schools into little wolflings whose motto is “f-you, I gotta get mine.”
Procopius
@Citizen Alan: I think so too. Adam Smith did not admire rich people. Remember, he was a lecturer in Moral Philosophy at Edinburgh University, and his first book was A Theory of Moral Sentiments. I’m always glad to see quotations, especially since the Aynrandians and Glibertarians totally misrepresent the passage about the Invisible Hand.
hoodie
Although Lewis accurately portrays elite culture (same goes in law and other professions), he seems to labor under a fantasy that more “freedom” will solve the problem with Wall St. When my dad was a broker in the 60’s, the investment firms were all partnerships, the NYSE and other equity exchanges were almost completely separate from banking and corporate finance was dominated by vanilla bonds and bank loans. Banks gave the kind of institutional stability that Lewis seems to think is lacking. The exchanges were Vegas, which is what they should be as long as you keep the banking separate. Turning investment banks into publicly-traded companies and letting banks get involved in trading were the original big mistakes. Trying to turn Wall St. into Silicon Valley like he advocates would be another mistake because, as Lewis acknowledges, there is nothing in finance that corresponds to the relatively immediate feedback that is operative in SV (as flawed as SV is). You have no way of knowing whether a financial innovation really “works” until way down the road, when it may have become a systemic risk because firms have jumped into it like lemmings searching for a quick buck on the initial transactions.
Tyro
People from elite schools go to Wall Street because it provides the greatest rewards for the least risk.
Yes, some people get rich in tech, but most everyone there is just making a very low end upper middle class income. You can get rich being an orthodopedic surgeon, but it takes a lot longer to get there, and there are more “points of failure” that can derail your plans (application to med school, applying for residency, getting a fellowship). We all know what a mess the legal job market is. What does that leave? Finance.