The New York Times printed an article today entitled "Crisis Altering Wall Street as Big Banks Lose Top Talent" about the exodus of employees that is going on from many of the top financial companies.
The arrogance of Wall St. is on full display in this article. First of all the big financial companies, CITI, Bank of America, JP Morgan etc., are actually worried about losing these people! They are calling it a brain drain. "Brain drain" I assume implies that something of intelligence and value is being lost. All that top "talent" that torpedoed the global economy is leaving. Oh no! What will Wall St. do? Hire people that aren't huge fuckups? Nope. Bemoan government intervention? Yes. More craziness to come below the fold.
Top bankers have been leaving Goldman Sachs, Morgan Stanley, Citigroup and others in rising numbers to join banks that do not face tighter regulation, including foreign banks, or start-up companies eager to build themselves into tomorrow’s financial powerhouses.
Vikram S. Pandit of Citigroup and Jamie Dimon of JPMorgan,say it will be harder to break away from taxpayer support if the workers most capable of steering their banks toward recovery walk away.
The most capable of steering their banks toward recovery? These are the guys that drove us into this intractable quagmire. I suppose they may be the only ones who truly understand how profoundly they fucked up, but I doubt it. It is far more likely that they see themselves as free of guilt.
The idea of talent on the Wall St. has become completely divorced from performance. They don't understand that the "best" investment bakers are responsible for all of this. It's like they live in a dream world where their actions had nothing to do with it and they all got unlucky at the same time.
What may be even more disturbing is that these people are being rehired. Let me say that again. The people who wrecked the world's economy are being rehired at "up and coming" boutique financial companies.
Michael O’Hare, who used to run North American equity cash trading and sales at JPMorgan Chase, is building a new sales and trading operation at LaBranche Financial Services, an established firm that is starting a line of business that was traditionally done only within investment banks. "We are attracting people from Merrill, from JPMorgan, from Bear," he said. "I’m not talking the second tier. We have the cream of the crop."
The cream of the crop? Yes they have plucked the very best from the wreckage of the world economy. These special bankers made the most money for their corporate masters before passing on their huge losses to the American taxpayer. And you know what? They are looking to do it again. The article talks about previous companies that emerged during financial turmoil and then adds this,
Today’s upstarts aim to do the same by hiring away the industry’s talent and, in some cases, trying to replicate the entire investment banking model that was largely dismantled after Lehman Brothers fell last fall.
"We have the opportunity to step into the shoes of a Bear Stearns or a Lehman," said Lee Fensterstock, the chief executive of Broadpoint, a Manhattan firm that has hired more than 240 people since fall 2007, when the financial crisis started taking root.
Do they realize how insane that sounds? Why would you want to step into the shoes of Bear Stearns or Lehman brothers, two companies whose staggering liabilities caused them to go under. Why would you replicate that investment banking model?
It has been said before, but the definition of insanity is doing the same thing over and over again and expecting different results. These people are a cancer who are stuck in the same mode of thinking which got us into this mess. The new government oversight and restructuring must apply to all of Wall Street and not just the companies on the public dime. If the whole system is not changed, the same players will emerge playing the same game. And then we all lose.