Little Miss Sunshivavna

I used to rule the world
Seas would rise when I gave the word
Now in the morning I sleep alone
Sweep the streets I used to own


Times are tough for financiers. “Flat” is the new “up” in sell side bonus—and that's for the stars. The Job Slasher has been reigning terror for the last 16 months, the victim toll now reaching over 120,000 according to a recent Bloomberg report. Such instability, combined with an equally volatile buy side, raises the question: where exactly are all these Wall Street throwaways supposed to go?

Let’s begin by acknowledging that their destinies bear direct impact on us all. "They had it coming," we might hiss outwardly, but deep down inside, visions of MBAs wiping the floors at Kentucky Fried Chicken make our stomachs turn. Such visions violate the Street’s most sacred doctrine — a previously uncontested conviction that education, dedication, and raw ambition lead to money and prestige. Judge those values (or lack thereof) if you wish, but don't deny that this notion of meritocracy, this paved road to success, this traditional interpretation of the "American dream" is imperative to our sense of comfort and normalcy, and that Wall Street has long been counted on to guard it.

There is an equation for success, and in this equation the output must always be equal to or greater than the input. In a sense, capitalism is a collective faith in this very mechanism. But what if the rules were to suddenly change? What if slaying the dragon got you nothing more in the end than a pat on the back and a handshake? Well, then we would be looking at more than a failure of the banking system—we would be dealing with a fundamental leak in our economic ideology, and that’s a large enough leak to drown us all.

The most unnerving thing about the layoffs is not the temporarily displaced, but the permanently misplaced, as many bright, talented, and highly educated people are now at risk for long-term underemployment. Bloomberg reports that, according to school directors, “A growing number of out-of-work New Yorkers are turning to bartending. Enrollment in the American Bartending School in Manhattan climbed 53 percent since last October to 84 pupils, the most for the month in five years, director Joe Bruno said in an interview. Another school director was quoted as saying “The increase I'm talking about, it's definitely that corporate, Wall Street, finance kind of thing.''
“This will be a huge year for us,” Bruno brags. And it is only four years ago that I had investigated some of the most prominent bartending schools for using unscrupulously aggressive recruiting tactics to beef up enrollment. I am guessing their recruiters no longer have the need to assure perspective students that they can ride their youthful appearance all the way to the bank because "men are dumb and will throw away money to have young girls serve them liquor."

As for the ones determined to stay on the professional track — their prospects appear grim. Perhaps Joe the Electronic Trading Platform developer can find a new home at Google, but finance as a whole is a highly specialized profession with a precise skill set and an esoteric knowledge base. This has not stopped many from trying to leverage their Ivy League degrees and their endurance for 14-hour days into alternative careers. One particularly promising New York City-based Internet startup received close to 3,000 submissions for their nine job openings. "A number of those were from Wall Street people" according to their CEO. Such a leap might be a viable option for junior bankers whose ties to the industry have not yet solidified, but we are unlikely to see an exodus of seasoned professionals fleeting Wall and Broad for good. They are much too vested in finance.

What I am seeing instead is a compromise that would hardly even register unless you understood the intricate balance of the financial game. Financiers are notorious for classifying and grading just about everything. In “Liar’s Poker” Michael Lewis gives a behind-the-scenes view of Salomon Brothers in the 80’s. Trainees were kept in line with threats of being assigned to an equities group at the end of the program. This was during the rise of the bond, and deportation to “equities in Dallas”, as they referred to it, was tantamount to suicide. As of lately, structured products, better yet structured-products at a hot fund or a prop desk was what Wall Street wanna-be dreams were made of. “I am flexible,” I would hear year after year at the NYU job fair, “just not risk.” Risk monitoring was the area that the stars would not touch with a ten-foot poll. Who wants vanilla when they can have the chocolate-sprinkled pistachio with a cherry on top? Is it any surprise then that we now find ourselves in a catastrophic mess? Yet, the current climate finds slews of the no-longer-persnickety job shoppers readjusting their barometers and redefining “good jobs”, much like the traditionally underperforming and slower paced fund of funds and pension funds are suddenly attracting the fast-trackers.

Whether or not we should consider those people underemployed is a tough question. In better days, it felt like natural selection to have crème de la crème, those innovative geniuses, hatch up new investment strategies, while the betas stuck to policing their recklessness. But the landscape has changed drastically, and so has our perception with it. It is clear that Wall Street had underestimated the importance of risk functions, and is now scurrying to rectify that. So perhaps it is not so tragic that the stars will now be reassigned to “second-tier” jobs because some of those, like risk for instance, has gotten an upgrade. And maybe, just maybe, if they had been there in the first place, our current crisis could have been prevented.

But - the greatest irony of all since Hollywood A-listers donned trucking hats, are Morgan and Goldman bankers, who once ruled the school and are now forced to eat lunch with the tellers and credit card sign-up telemarketers, seeing their elite employers surrender their “bad-ass [investment] bank” statuses. Sorry you went through seven rounds of hazing, ehh… I mean interviewing, to work at a commercial bank guys. Sure it will take some time to internalize the new vocabulary and for your confidence level to get back up to the point of where you can throw “Hey baby, I work at Goldman. The Commercial Bank. Ever heard of it?” around. Perhaps even longer till that gets you anything more than a polite nod and a subliminal “buzz off” smile. In your hay day, you had done a spectacular job of convincing the pretty masses of your gloriousness, and they are not so adapt to sudden status switcharoos. But you will get there. We all will. Wall Street will prevail. It just won’t be the exact same Wall Steet that we once knew, but those outside of it will hardly even notice. As for the ones unable to reinvent themselves on par with the new market and unqualified to do anything else? My heart goes out to them. Really, truly. Let’s say a little prayer for them and hope they have been saving their bonuses.