
Wall Street’s Brain Drain Defense - peter123
http://www.nytimes.com/2009/02/22/weekinreview/22gillen.html
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pxlpshr
My dad always wanted me to be a finance geek, "he who manages the money, makes
the money" as he would say. In my eyes, it's a self-serving statement and a
prime example of the economy taking a left turn into the deep end.

When 'managing' is valued higher than creation, we have problems. Big
problems.

~~~
swombat
This argument is terribly fallacious.

"Managing" is extremely important to value creation. A fundamental principle
of capitalism is that you can use existing wealth ("capital") to invest in
ways to create more wealth. Capitalism relies on people's self-interest to
ensure that each investor will invest in the opportunity that has the most
value-creation potential with the lowest risk.

Investors, people "managing money", aren't just sitting on the sidelines
cashing in on everyone else's good ideas. Their essential purpose is to move
available capital to wherever it will produce the highest returns - i.e.
wherever it will produce the most wealth.

The total wealth of a nation impacts the wealth of everyone in that nation. I
don't like the way republicans use the idea of "trickle-down economics", but
the fact is, if you create lots of value (by putting money in the right place
at the right time), that value inevitably spreads to many other people in the
economy.

Managing money is not "taking a left turn into the deep end". Creation will
happen in hundreds of different forms. Picking the one that works best and
giving it life is extremely valuable.

~~~
pxlpshr
Good argument and I agree with you, but by my point is more focused on recent
actions in regard to the socialization of risk and privatization of reward. My
comment aside, I definitely appreciate the value of honest financial gurus.

To your point re: the principles of capitalism, US is still very young and
most institutional investments funds are not top performers longer than a few
years. They are NOT the best for picking long-term winners, ultimately their
criteria is governed by a 5-10 year exit. Let's not carelessly forget where
capitalism can get it wrong — self-interest has done plenty of harm in man's
time.

What concerns me is that many of these "managers" are now on the 'creation'
end of the "solution".

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RiderOfGiraffes
Quoting:

> _Up and down Wall Street, financial types are grumbling that their
> industry’s highest highflyers are getting their pay capped. Many Wall
> Streeters say this would be disastrous. The sharpest financial minds will up
> and quit, the argument goes, and take their smarts with them at the very
> moment they’re needed to re-engineer their companies and restart the
> economy._

If they're really good, and they go into industry, won't that actually be
better for the economy? It's hard to see what Wall St types actually
contribute to the economy.

~~~
byrneseyeview
_It's hard to see what Wall St types actually contribute to the economy._

It's really unfortunate that people see things this way.

Somehow, the fact that I can -- in seconds -- convert money I earned at my job
into a stake in one of thousands of businesses, many of them operating in
multiple countries and offering multiple product lines (and the fact that the
cost of converting my dollars into this stake costs less than, well, a good
steak) is incredible. It's jaw-dropping.

It's stunning that someone in Florida can live off of the profits of mines in
Madagascar, fast-food restaurants in California, steel mills in South Korea,
and insurance companies in Connecticut, all without spending more than half an
hour a week reading brokerage statements.

It's astounding that an entrepreneur can take a business whose future profits
can't be estimated to within an order of magnitude, and sell a portion of that
business for a specific amount.

Finance is an incredibly valuable industry. Getting even some of this stuff
slightly right creates a lot of wealth, and helps other industries create a
lot more wealth. There have been excesses and there has been incompetence, but
that doesn't change the fact that finance, in the aggregate, has been very
beneficial.

~~~
swombat
_It's really unfortunate that people see things this way._

It's also quite unfortunate that the wave of anti-banker populism seems quite
lively on HN too. I thought we were better than that.

~~~
jsteele
Its not anti-banker populism. Its the bailout mentality that these bankers
have that's disconcerting. A startup that fails disappears the way its
supposed to, but when a big bank fails we all pitch in the bail them out.
That's the problem.

~~~
swombat
_It's not anti-black racism. It's the welfare mentality that these black
people have that's disconcerting. White people work for their success like
they're supposed to, but when black people want to succeed we have to help
them out with minority protection laws and quotas and such. That's the
problem._

Whenever you generalise something to a large number of people, you commit some
sort of anti-? ?ism. "Bankers" are not a singular entity that can have a
"mentality".

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rayvega
>> If some Wall Streeters move on, perhaps other, more innovative
professionals will take their place and build something a bit more
durable..."You might get down to the core group that actually likes finance,
and lose people who are coming just for the money,"..

Is this not precisely what happened when the last big bubble burst, the dot
com era? People who had no real business being in technology or had no passion
about programming left the industry leaving behind the ones that actually
cared and were much more motivated and driven leading to greater innovation.

Taking a page from history, I say this is a good thing for Wall Street in the
long run.

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gaius
And where will they go, exactly? Corporate America isn't hiring either.

