
For the Love of Money - _ntka
http://www.nytimes.com/2014/01/19/opinion/sunday/for-the-love-of-money.html
======
tkiley
_I was a derivatives trader, and it occurred to me the world would hardly
change at all if credit derivatives ceased to exist. Not so nurse
practitioners._

Is this statement (from the article) true?

I'm under the impression that financial innovations throughout history have
generally spurred capital investment. Innovations like fractional-reserve
lending have made bankers&investors wealthy, but also spurred spending on
infrastructure in a way that could be a win-win for society as a whole.

If today's financial wizards went away, would we feel a surprising amount of
ripple impact, or would they really just not matter?

~~~
phillmv
It's sorta up for debate.

My understanding, which is tiny and very limited, is that you can think of the
role of finance operators as "liquidity providers". They're the grease in the
wheels of capitalism; by either providing access to capital (via loans, or
investment) or by matching buyers with sellers.

A classical example is you're a farmer that wants to hedge the risk that your
crop will fail due to random weather events or that there will be such a glut
in the market that you won't be able to sell your crop profitably. So, you
enter a contract to sell your crop at a fixed rate long before harvest comes
along. That's a future contract, and it's a kind of derivative.

So, derivatives can be really socially useful instruments. They can act like
certain kinds of insurance, or allow you to capture different dimensions of
value on assets that you already own.

However, and here's where the argument comes in, it's not clear that all kinds
of derivatives provide socially useful forms of gambling. The prime example
here is that of the collateralized debt obligation in which huge portions of
the US mortgage market got sunk into.

Mortgage backed securities are probably not in of themselves _terrible ideas_
but the way CDOs were structured made it impossible to objectively value the
risk behind the instrument. It's just not clear how a dip in the market might
affect the value of your CDO tranche. It's actually an np-complete problem -
[https://freedom-to-tinker.com/blog/appel/intractability-
fina...](https://freedom-to-tinker.com/blog/appel/intractability-financial-
derivatives/)

Another example is high frequency trading - where you're a day trader on
steroids and have computers exchanging massive quantities of stocks based on
fluctuations of fractions of cents. HFT people will argue that they provide
more liquidity in the market - it's easier to sell your stocks because HF
traders increase the overall volume, etc. However, it's in effect launched an
arms race between different trading firms and some people say that they're
literally making money by skimming off everyone else who trades stocks.
There's a very reasonable argument that _we don 't want markets to operate
faster than human perception_. If you have to make a decision about selling
something, placing a ground foor and minimum transaction time of say half a
second isn't going to harm anyone who needs that liquidity for their business,
or anything else that touches the "real economy".

To summarize: certain kinds of financial instruments seem to provide no value
above and beyond letting well-connected actors to place (potentially
ridiculous) bets. Using your money, one way or another - whether it's your
farm, the mortgage on your house, or your pension fund.

\--

If we accept the above as true, we can go further on a limb and ask questions
about why is the wealth that passes through financial markets so liberally
redistributed to people in the industry? Some people talk about it being a
function of volume, but individuals are rarely if ever liable. When do they
stop providing a service, and when do they start skimming off the top?

~~~
sbierwagen

      HFT people will argue that they provide more liquidity in 
      the market - it's easier to sell your stocks because HF 
      traders increase the overall volume, etc.
    

A problem with their argument, (one of many) is that HFTs are not regulated
market makers.

[http://en.wikipedia.org/wiki/Market_maker](http://en.wikipedia.org/wiki/Market_maker)

HFTs provide liquidity when the market's good, but you always have plenty of
liquidity when the market's good. You only really _need_ liquidity during a
price crash, which is precisely the moment all the HFTs head for the exits,
and the exchange seizes up.

HFTs are essentially a tax on stock transactions, and if you actually _wanted_
that, why not have a legislative tax, rather than giving 5% to whatever stock
trader has the shortest fiber optic cable to the exchange?

~~~
panarky
Charlie Munger, vice chairman of Berkshire Hathaway, argues that high-
frequency trading is "legalized front-running".

    
    
      I think it is very stupid to allow a system to evolve where half the trading
      is a bunch of short-term people trying to get information one-millionth of a
      nano-second ahead of somebody else. It’s legalized front-running; I think
      it’s basically evil and it should never have been able to reach the size
      that it did ... why should all of us pay a little group of people to
      engage in legalized front-running of our orders?
    

[http://blogs.barrons.com/stockstowatchtoday/2013/05/03/charl...](http://blogs.barrons.com/stockstowatchtoday/2013/05/03/charlie-
munger-hft-is-legalized-front-running/)

~~~
harryh
Charlie, as a guy who regularly buys and sells large volumes of stock, is just
talking his book. It would be great for him if he could make large
transactions without the stock price responding quickly to this new
information. But it would be bad for everyone he transacted with.

To make this concrete:

Say Charlie & Warren wake up one day and decide Company X is undervalued and
that they want to by 5% of it. They start buying stock. In the old pre HFT
days it would take a while for the market to notice all this new demand so
they could get a lower price. But now HFTs are really good at noticing this so
the price rises faster.

But wait you say! This is the "front-running" that Charlie is complaining
about and that's bad! He's getting screwed!

But what if you were one of the people selling to Charlie. Before HFTs made
the price faster you were the one getting screwed! There was all this new
demand and you didn't know about it yet so you weren't getting as good of a
price as you otherwise could have.

HFTs aren't front running. They just move the stock to it's true price faster
than the humans doing the job before could.

~~~
smartbuttcute
The large investment banks actually have a code they can append to their
orders so they can jump to the top of the order cue.

That is the definition of "front running".

I'd like to see a 1 cent tax per share per transaction. That'd dramatically
limit HFT.

~~~
djoldman
Anyone connected to Direct Edge can send an order flagged as HideNotSlide.
Everyone is playing on an even field with respect to that order type.

HideNotSlide does not cause an order to "jump to the top of the order
cue[sic]." It preserves your order entry time at a price that is contra the
NBBO if there is not an order at Direct Edge at the NBBO (if there is an order
at Direct Edge at the NBBO the incoming HideNotSlide order is filled).

I doubt "HFT" would be dramatically limited by a transaction tax. I believe
that it would lower trading volume by some amount and widen the bid/ask by
some amount. The number of "HFT" firms and their trading habits would look
mostly the same though.

~~~
smartbuttcute
I visited DirectEdge.com I doesn't appear that the average investor is allowed
to join.

[http://www.directedge.com/Portals/0/04Support/Membership/EDG...](http://www.directedge.com/Portals/0/04Support/Membership/EDGA%20Exchange%20Application.pdf)

~~~
djoldman
You don't have to be a member of the exchange to trade there. You can connect
through many outlets, some of whom offer a FIX (Financial Information
eXchange) API. You can submit HideNotSlide orders through FIX and perhaps
through your brokers' GUIs.

The point is that no special license or membership is required, although you
may have to do some work to implement this type of order.

------
pimentel
Whenever I see rich guys forfeiting on more money so they can help the poor, I
remember this:
[http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others...](http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others/)

TL;DR:

 _If a high-powered lawyer who makes $1,000 an hour chooses to take an hour
off to help clean up litter on the beach, he 's wasted the opportunity to work
overtime that day, make $1,000, donate to a charity that will hire a hundred
poor people for $10/hour to clean up litter, and end up with a hundred times
more litter removed. If he went to the beach because he wanted the sunlight
and the fresh air and the warm feeling of personally contributing to
something, that's fine. If he actually wanted to help people by beautifying
the beach, he's chosen an objectively wrong way to go about it. And if he
wanted to help people, period, he's chosen a very wrong way to go about it,
since that $1,000 could save two people from malaria. Unless the litter he
removed is really worth more than two people's lives to him, he's erring even
according to his own value system._

If he feels it's unfair that he makes so much more many than others, he should
make even more and give out what he think is enough to make it fair.

~~~
arjie
Statement fails to take into account all factors by using a contrived example.
It isn't just about cleaning the beach. It's about cleaning the beach in the
same way as everyone else. It's about a long-term sustainable solution. What
happens when the lawyer is gone? Should you find another funding lawyer or is
it better to have everyone get into the habit of cleaning the beach? Then once
it becomes a community activity, it doesn't matter if the lawyer exists or
not. It becomes a thing that people do.

To address your second comment, we must consider the possibility that people
are interested in long-term solutions to problems. What happens when the
person who thinks that his profession makes too much money has given away all
his money? Is the problem fixed?

The world isn't binary. When someone says "I want to help the poor", there's a
world of meaning you can gather from context. We aren't AliceBot, we're
humans. And humans are fairly good at understanding statements like that.
After all, one way to help people is to kill oneself in a manner that
preserves organs for donation, but you'd dismiss this kind of meaning even
coming from a down and out guy who makes nothing and has no family. Why?
What's he implying when he says he wants to help people?

------
jackgavigan
I've long since grown tired of these sensationalist, populist, polemical,
self-flaggellating, attention-seeking, pseudo-confessionals by ex-bankers
(usually failed ones, although they'll rarely admit that, preferring to
portray themselves as having quit for moral reasons, rather than having been
unceremoniously fired), getting all angsty about their previous life as an
evil, greedy, detached-from-reality monster. Geraint Anderson, Polly Courtney,
Tetsuya Ishikawa, John Rolfe and Peter Troob - they're all just pale
imitations of Michael Lewis's "Liar's Poker" (Frank Partnoy's "FIASCO" is a
notably less-pale imitation), feeding the media's seemingly-endless appetite
for new scandalous revelations about the behaviour of people who get paid lots
of money.

Seriously. Enough already!

Disclaimer: I was an evil, greedy, detached-from-reality monster in a previous
life.

~~~
perfunctory
I am curious how do you tell a pseudo-confession from a genuine one.

~~~
gadders
See if they have a book or other project to publicise.

~~~
kelvin0
So I guess everyone marketing a book is a phony? You never learned anything
valuable written by someone who marketed it and believed in it? I though I was
cynical ... you Sir are the King.

------
mindcrime
Yay, more villifying "Wall Street" and fueling the "Wall Street vs. Main
Street" fire, and suggesting that it's somehow noble or good to _not_ want to
be rich.

I think everybody should want to be rich.

I've tried poverty and in my opinion - it sucks. It sucks big, steaming donkey
balls.

The desire to make more money, to improve one's "lot in life" and to succeed,
this is a Good Thing. Because a few assholes go too far in some ways, or do
bad things along the path, does not change the fundamentals.

You can be rich and unhappy, or poor and unhappy. Given a choice, if I'm going
to be unhappy, I'd rather at least be rich.

No one should feel any need to apologize or feel guilty about wanting to make
money, even lots of money. If you want to be a fucking billionaire, go become
a billionaire. Just feel guilty if you lie, or cheat or steal, or otherwise do
unethical things to get there. And remember that having more money doesn't
make you a better person, or intrinsically more valuable.

~~~
king_jester
> The desire to make more money, to improve one's "lot in life" and to
> succeed, this is a Good Thing.

One of the key points of this essay is that making more money doesn't
necessarily improve one's quality of life. The author clearly talks about at
age 25 being financially secure and wealthy, so his pursuit of additional
wealth wasn't really about an increase in quality of life.

> You can be rich and unhappy, or poor and unhappy. Given a choice, if I'm
> going to be unhappy, I'd rather at least be rich.

Wealth and class aren't about binary choices. There are levels of income that
are wholly satisfactory for an individual's life that still classify that
person as not rich.

> No one should feel any need to apologize or feel guilty about wanting to
> make money, even lots of money. If you want to be a fucking billionaire, go
> become a billionaire. Just feel guilty if you lie, or cheat or steal, or
> otherwise do unethical things to get there.

Is it even possible to be a billionaire without exploiting others? Even if so,
is it right that you can be a billionaire while there are more empty homes
each night in the US than the homeless population? Is it right that you can
safely eat anything you like while others have to make sacrifices and choices
because of political cuts to SNAP? The answer is clearly no. In this way,
pursuing money for wealth's sake is unethical.

~~~
peterpathname
I don't think it's possible. We live in a finite world. All my wealth comes
from someone else's poverty.

~~~
aidenn0
There is more per-capita wealth today then there was 1000 years ago. This is
despite there being far more people today than there was 1000 years ago.
Therefore it is possible to increase the total wealth in the world.

------
31reasons
I am just wondering, are these Wall Street traders smarter than an average
techie working in Silicon Valley ? Are they so irreplaceable that they are
offered so much salary and bonuses ? It just doesn't seem right. I am afraid
to even ask for 150k salary in SV for the same amount of cerebral work.

~~~
bigbang
I was wondering the same. How hard is it to go from a programmer to a trader
in a bank?

~~~
mhb
Why be a trader in a bank? Lease a commodities seat and trade for your own
account. How hard could it be?

~~~
bigbang
I'd rather be trading on someone else's money :) My question is about how to
get foot into the door as a trader.

------
CreakyParrot
TL;DR: He used to use drugs and booze to deal with his insecurities. Then he
used money. Now he (apparently) uses the attention that comes from telling
everyone how wise and honorable he has become.

~~~
ivanca
This is a perfect example of the cynic snarkiness for the sake of snarkiness
that plagues Hacker News; the guy of the article only has written one article
besides this one[0] and that's it. He doesn't even have a profile pic or a
clickable profile as most journalist in the NYT have. And he seems to spend
his time as the director of something called groceryships not creating support
groups for money addicts or selling self-help books. So much for an attention-
seeker.

    
    
      [0]http://www.ocregister.com/articles/obesity-596818-food-stress.html

~~~
CreakyParrot
"Cynical: believing that people are motivated by self-interest." Call it a
plague if you like, but I'm OK with it.

And I wasn't being sharply critical (snarky) for the sake of being sharply
critical. Honest.

He's pretty actively promoting himself, his story, and his business (which is
what it is) online, and he just successfully SEO-bombed his way to the top of
the charts. You may think it's out of an abundance of goodness, but I think
that's as naive a view as you think mine is cynically snarky. (Or snarkily
cynical.)

~~~
ivanca
Because his name is not clickeable it means 100% of the people that is
interested in him had to google him. So it's pretty easy to measure it's
impact.

[http://www.google.com/trends/explore#q=%20SAM%20POLK](http://www.google.com/trends/explore#q=%20SAM%20POLK)

So it's impact augmented by a factor of 20; if he was searched 10 times per
month before it means now he is being searched 200. So not that much but even
if it were your point still doesn't make sense to me because what difference
would there be with anyone writing anything? I guess that your point is not
that everyone should write anonymously right? So, what is it?

------
yodsanklai
“I don’t have the brain capacity to think about the system as a whole. All I’m
concerned with is how this affects our company.”

I wonder how many people really understand the system as whole. From the
outside, it looks like a complex natural phenomenon that we don't really
understand and don't control.

~~~
ricardobeat
That's not to be taken literally, you can be pretty sure the head of a hedge
fund understands the system very well. He was just stating his priorities.

~~~
adaml_623
A large number of hedge funds lost a lot of money in the crash. This is proof
of a sort that their heads did in fact not understand the system well.

~~~
kamaal
There isn't much incentive or motivation to think of the larger system, when
you are being paid $12 million an year bonus to think only of your own
benefit.

~~~
venomsnake
And that is why businessmen make mediocre politicians and policymakers at
best. You need to take all thing into account thinking decades into the
future.

So next time a self made billionaire thinks he can enter politics on basis of
his current success this should be taken into account.

------
logicallee
I like how after all that, he ends with an ask for a quarter of his readers'
bonuses to start a fund for his philanthropy

old habits die hard :)

~~~
mbillie1
> an ask

Can this new idiom be stricken from our collective lexicon? I've heard this a
lot lately in the tech community (although mostly from manager types) and it's
a linguistic abomination. "...he ends _by asking_..."

~~~
jellicle
It's a term of art in the marketing world. Legitimate jargon.

What's an equivalent... hmm, suppose I talk "a pull" in the context of a
version control system. I'm talking about something with a specific meaning.
It would be wrong to try to correct me and tell me I should talk about "a
thing that is pulled".

~~~
mbillie1
Except that a pull in VCS is a separate thing. "An ask" seems to always mean
"the thing that we are asking for," not some nuanced alternative or domain-
specific concept.

------
mrbill
My thought after reading this article: "Must be easy to feel good about
walking away from making more money, and make a career of talking about it,
when you've got that nice cushion of a few million in the bank already."

~~~
vehementi
Same here, I was thinking of that anecdote about the catch 22 author being at
some party. Some banker says "that 25 year old over there made more money last
year than you have in your whole writing career"

and the author replies back "I have something he'll never have - enough"

Except when the banker wisens up and has the "epiphany" that his tens of
millions are enough and lives a paradise of a life ever after.

------
geezer
This is apropos for this thread

"The wealth of the 85 richest people equals that of half the world's
population, says development charity Oxfam

[http://www.belfasttelegraph.co.uk/news/local-
national/uk/wea...](http://www.belfasttelegraph.co.uk/news/local-
national/uk/wealthy-grabbing-power-says-oxfam-29931690.html)

------
yetanotherphd
I think the author has suffered from a lot of psychological pain stemming from
his childhood, and I can sympathize a lot with that. I think he really did
have a wealth addiction, like he describes.

However, that doesn't generalize to the entire industry. People (especially
men) like money and power because of the benefits they brings. It doesn't have
to be an addiction. Furthermore, the idea that it would take an addiction to
wealth not to see how immoral the finance industry is, is reliant on having
very specific (and wrong, in my opinion) political views.

~~~
ItendToDisagree
_Yes, I was sharp, good with numbers. I had marketable talents. But in the end
I didn’t really do anything. I was a derivatives trader, and it occurred to me
the world would hardly change at all if credit derivatives ceased to exist._

Hits the nail on the head for me. In the end these people make incredible
amounts of money for doing what amounts to a job that is worthless to the
society at large.

~~~
philosophus
If it is "worthless to the society at large" then why do people pay for it?
Are they insane? It's popular to beat up on the financial industry, but they
do actually do something: finance loans. Without them, good luck getting a
mortgage, car loan, or a loan to start a business.

~~~
ItendToDisagree
You're seriously attempting to imply that there were no loans/lending of money
before 1993 (when the derivatives markets became a 'thing')?

Or are you just talking about the financial sector in general (and even so
there were loans long before that.)

Wall St. does not exist so people can get loans to purchase houses/cars... You
may be missing some points about loans vs trading here...

~~~
jaredsohn
Derivatives help determine prices, moves risk to those who want it, increase
trade volume, control speculation, and create educated predictions for others
to observe.

[http://en.wikipedia.org/wiki/Derivative_(finance)#Economic_f...](http://en.wikipedia.org/wiki/Derivative_\(finance\)#Economic_function_of_the_derivative_market)

~~~
ItendToDisagree
Exactly, they do not provide loans, or determine availability of said loans
(beyond insulating risk allowing an institution to make more risky investments
which as we've seen can be a catastrophic practice).

I would venture that none of these things benefit the 'average' person. Not
saying its a bad thing, but the great amount of money dumped into this area of
the economy, does not equate to their usefulness to society.

Edit: Actually the next section in the link you provided shows exactly how
they can be a great detriment to economic stability including the recent AIG
fiasco.

 _the use of derivatives to conceal credit risk from third parties while
protecting derivative counterparties contributed to the financial crisis of
2008 in the United States._

~~~
jaredsohn
If you're an average person who was going to lose your home, derivatives
enabled the bank to give you a loan. Therefore, derivatives have provided
value to average people.

However, the 2008 financial crisis showed that when tested, derivatives don't
provide much of the value that they were supposed to (shifting risk to those
who want it and will quietly suffer the consequences of failure without having
spillover effects on the rest of the economy) which essentially retcons away
much of that value.

~~~
ItendToDisagree
I fully agree. With the exception that the derivatives market allowed them to
make a more risky loan to you (IE one you may likely have not been able to pay
off and they knew it). I would say the value to society at large is very
observable as a negative. Getting a low percentage loan that is unstable or
even totally illusory is not value. At least not in my opinion.

------
Montareo
I personally find the comments here, written by so-called "hackers", truly
depressing.

Instead of tinkering about how the system can be made more just, viable, etc.,
instead of "hacking", the only "idea" that comes to the minds of so-called
"innovators" is: how can i become THAT rich ?, where do i have to sign ?.

Sad, depressing, disgusting, predictable.

~~~
VexXtreme
Sorry to break it to you, it's called "human nature".

~~~
chippy
Actually calling something "human nature" is lazy, inaccurate and harmful.
It's giving up on the issue, it's simplifying psychology, it's encouraging
inertia and the status quo. It's saying "Sorry, nothing can be done, it's
biology".

This goes for many things, not just the desire to have lots of money.

------
frogpelt
This is the ugly underbelly of capitalism: that people aren't paid based upon
their "importance". They are simply paid based upon their "value" to the
market. Is it important for Clayton Kershaw to pitch for the Dodgers? No, but
it is demanded.

While I understand the sentiment of wanting to help the poorest of the poor,
if it's true that money isn't the be-all, end-all then does it really matter
that a trader makes millions while a nurse practitioner only makes $100k? The
money isn't what's important, right? And the poorest of the poor in this
country are rich compared to the poor from previous generations.

~~~
yetanotherphd
I would say that in most cases, people need to redefine importance in a way
that is hard to accept. There is no need for scare quotes. The value is real,
and when a person earns a certain amount, it's because the produce that much
value (finance is kind of exceptional, in that there is a mix of true value
and rent-seeking).

Now how can it be that nurse practitioners don't produce that much value? It
is because the relevant quantity is the _marginal_ value of an additional
nurse practitioner, not the _average_ value. And why is it fair to pay people
according to their _marginal_ value, and not their average value? That is
because it incentives the most efficient behavior. An additional software
engineer is worth more to society than an additional nurse. The fact that
getting rid of all nurses would be worse than getting rid of all software
engineers (assuming this was true) is irrelevant, because as people quit the
nursing profession, wages will rise.

So the problem is not capitalism, but people's inability to accept that the
implications of economics theory: first, that there is no ethical reason to
reward people for the average value of a person in their profession, as
opposed to the marginal value, and second, that frivolous things like Twitter
can be as valuable as medical services (if people are willing to pay as much
for either).

~~~
frogpelt
Very well stated. And you're right, no need for scare quotes.

------
yodsanklai
"I recently got an email from a hedge-fund trader who said that though he was
making millions every year, he felt trapped and empty, but couldn’t summon the
courage to leave."

I don't find it surprising. Many people feel that way about their job. It must
take a lot of courage to leave such a lucrative career.

~~~
gesman
It's arguably better to feel empty about million dollar occupation vs. feeling
empty about poorly paid occupation.

~~~
rpicard
It's arguably better to feel empty about a poorly paid occupation than to feel
empty about being unemployed.

It can go on for a while, but it doesn't mean people shouldn't address their
problems.

~~~
gesman
...starting with definition of the problems...

------
speakme
Having spent a few years in the finance industry, in my experience most people
in my area of work were not these type A money addicts described. That said, I
am confident they added no value, and made millions of dollars taking
management fees in exchange for lower returns to their clients than they could
have gotten in an index ETF. That might be just as big a problem: that even
honest members of the industry can convince themselves they're worth their
exorbitant salaries, because someone's willing to pay it.

------
mikekij
Great article.

TL;DR - I was a douche. Then I was visited by the ghost of christmas past,
stopped being a douche, and started giving away groceries. I'm still rich
though.

------
rwissmann
Just to point it out: The comments under Readers' Picks and NYT Picks are
really worth reading as well.

------
blazespin
The fundamental problem with HFT is not HFT itself, but rather that there is
massive intellectual capital playing tug a war with itself while it could be
working on huge problems in genetics, AI, software, physics, etc.

------
yodsanklai
I find the finance world quite fascinating! Some of those guys are super
wealthy even though they have what looks like regular technical office jobs.
With the same skills in a different industry, they would have had "normal"
salaries.

~~~
lxlxlxlxl
You might enjoy the book "Liars Poker" by Michael Lewis that the author
references. I find the finance world interesting also, and read the Financial
Times as much as possible. Most fascinating obituaries youll ever read.

------
auvrw
yeah, that's pretty f'd up, but it's good that the guy's moving on with his
life.

i wonder how much time it'll take until we get to a star-trek-like economic
system where people do the things they want to do to the extent that their
abilities allow and noone can make the excuse, "i'm not interested in money.
i'm interested in what money lets me _do_."

i like that this guy just came out and said, "yeah, i was interested in the
money for its own sake." it sounds a lot less noble, but it seems a lot more
honest to me than any other justification for having far, far more cash than
any one person really needs, except for, "i'm giving it to charity."

------
nilkn
Do programmers on Wall Street ever see similar bonuses, or is it necessary to
work on the trading floor?

~~~
ChristianMarks
No way. Programmers are on the wrong side of the suit/geek divide, which is
something like the blood-brain barrier.

~~~
nilkn
Bummer. I suppose what I should really be asking, though, is this: do
programmers on Wall Street make enough to live comfortably in the city while
still hitting normal savings goals, like retirement? For Manhattan, I'm
thinking this would be a total comp. of $200k or above.

~~~
ChristianMarks
One can live comfortably in the city on ~ 95K. Perhaps one would have to make
$200K on Wall Street, if only because turnover tends to be high.

~~~
nilkn
I probably over-estimated what I'd need. I was just basing the number on what
I make currently and the difference in COL. It wouldn't be possible for me to
maintain my current savings goals on $95k in Manhattan.

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ilaksh
We need to change the structure/paradigm to make so much inequality
technically infeasible.

------
read
What stood out for me was this sentence:

 _From a distance I can see what I couldn’t see then_

Why is it that when you are close you're unable to see something for what it
is?

~~~
KiwiCoder
perspective

~~~
peterpathname
or parallax ... I always confuse the two.

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shmerl
Love of money? Sounds bad already.

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msie
Lucky guy.

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michaelochurch
I've worked in finance. There are all types. Sure, there are asshole alpha
traders who whine about $2 million bonuses. Those guys are pretty uncommon,
they're disliked even in spite of their P&L, and no one helps them when they
get unlucky. There are also people who don't think or live very differently
from respectable professors-- except who have $12 million in their bank
account instead of $12. There some pathological "wealth addicts" in finance,
but not that many; and there are far more in the VC-funded startup world. (VC-
istan is essentially Wall Street with a lower talent level and worse ethics.)

I used to think it was a negative that Europe doesn't have the same "class"
mobility. If you're rich in Germany or England, you're still considered
middle-class. Politicians don't worship you, your kids still have to work hard
if they are to attend good schools, et cetera. (The "upper classes" are
hereditary aristocracies that have lost 80-95% of their wealth, privilege, and
relevance.) You can't become upper-class if you weren't born into it, but the
flip side of that is that middle-class people can rise quite high. (There's
less mobility in social class, but more in terms of things that actually
matter-- economic well-being, access to education, etc.) The sickness of the
US is that we unify wealth, power, privilege, fame, and social connections by
creating an efficient market through which people can trade one for another.
Instead of having a society where some people have more money and some have
less, we have this toxic arrangement where some people are just implicitly
held to be universally _better_.

The issue for the OP (who sounds like a self-indulgent twat, to be honest) is
that he learned the hard way that making more money didn't make him a better
person-- at all. It didn't make him smarter, happier, or anything else. He met
his God and saw vapor.

The sad thing is that he's still better off than any of us. If he wants to
start a hedge fund tomorrow, or raise a $5-million seed round for whatever
project he wants to take on, he's got the credibility to do it. If he doesn't
feel like working hard, he could probably use his VC connections as a cash cow
by funding young startup kids on a shoestring while taking an unreasonable
percentage in equity (although that's been done before).

~~~
javajosh
_> If he doesn't feel like working hard, he could probably use his VC
connections as a cash cow..._

Actually, if he doesn't feel like working hard, it sounds like he could retire
on a comfortable 6-figure income for the rest of his life. Without interest,
naively $6m will yield $100k a year for 60 years, which is more than enough to
raise a large family in a nice neighborhood anywhere in the states -
especially if the home and taxes are paid for.

~~~
vacri
Without interest, 100k/year now is a lot, but in 60 years will be very, very
little. Have a look at average salaries now compared to 60 years ago - from
memory it's a little over a factor of 10 difference.

~~~
smileysteve
I think that he left out any interest just to make the statement simple,
obvious, and to avoid contest.

I'd be willing to bet that somebody from a background in Wall Street and
derivatives markets is not going to stuff their cash under the mattress.

If you want a complex statement that can be challenged, 10%/year on that
$3.6mln last bonus would result in $360k pre tax.

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nctalaviya
I really like it

