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McKinsey: Half the World’s Banks Too Weak to Survive Downturn

bloomberg.com

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Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#101

Post by omginternets »

radiator wrote: post #14
omginternets wrote: post #7

Earlier quoted context omitted.

>do another bailout. I know you're being tongue-in-cheek, but in theory, are governments even capable of doing another bailout? My understanding is that public debt in most Western countries (not sure about China/India) is through the roof. Other than printing money and risking a cataclysmic devaluation, what can be done?

I hope it does not come as a surprise if I tell you that printing money has already been, since a long time and in great quantities, taking place. The cataclysmic devaluation part is the one they are working on postponing.

Indeed it does not. I'm just not clear on how one postpones a cataclysmic devaluation.

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#102

Post by omginternets »

ChrisLomont wrote: post #24
howard941 wrote: post #11

Earlier quoted context omitted.

From the bank shareholder's perspective the bailout was a stunning success. For the rest of us debtors, for those who greased the runways for the shareholders with their lost homes and lost savings that went to paying off debts in disinflationary dollars when stimulus and reasonable inflation would have made paying debts off easier, it remains an ongoing disaster.

>For the rest of us debtors...it remains an ongoing disaster Taxpayers didn't pay for bailouts. The Fed did. Taxpayers did make a profit form them, however, since the profits the Fed saw from the bailouts were, by law, handed over to Treasury (except for statutory operating expenses), offsetting taxes. >those who greased the runways for the shareholders with their lost homes Most of those those losing homes did so by…

>Also blame borrowers defaulting.

Forgive my ignorance, but wasn't the subprime crisis so scandalous precisely because bankers were recklessly pushing mortgages on people who couldn't pay?

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#103

Post by wcoenen »

mywittyname wrote: post #46
omginternets wrote: post #7

Earlier quoted context omitted.

>do another bailout. I know you're being tongue-in-cheek, but in theory, are governments even capable of doing another bailout? My understanding is that public debt in most Western countries (not sure about China/India) is through the roof. Other than printing money and risking a cataclysmic devaluation, what can be done?

> Other than printing money and risking a cataclysmic devaluation The US government would need to print an insane amount of money to have a tangible devaluation impact. Even more so when the money creation is intended to offset deflationary pressures due to a economic contraction. Considering the GDP of the US is ~$20 trillion, I bet we're probably talking about $2-4 trillion of printed money, in addition to deflatio…

Things can happen very fast. The fed printed $128B in just two days to address the repo market crisis.

https://markets.businessinsider.com/news/stocks/fed-repo-inj...

Granted, overnight loans are not permanent injections of money. But it serves as a reminder that there is no speed limit on the virtual printing press of the fed.

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#104

Post by throwaways66722 »

Rainymood wrote: post #87
throwaways66722 wrote: post #67

Earlier quoted context omitted.

Not really. They're pretty much the same. *current mckinsey data scientist who got an offer from both Gamma and McKinsey, and turned down Gamma despite being offered a higher salary.

I'm thinking of applying to McKinsey as a data scientist, could we have a chat sometime?

I would prefer to remain anonymous but I'm open to answering questions here

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#105

Post by DuskStar »

throwaway66920 wrote: post #25

I believe this is the actual article https://www.mckinsey.com/industries/financial-services/our-i... Broadly it seems to be less extreme than Bloomberg’s summary and more nuanced to particular conditions. I like how exhibit 6 is rotated to encourage reading it from either direction. Haven’t seen that before in charts.

Ugh, I hate it when people do things like Exhibit 4 [0] - the size and coloration of the boxes does not match the numbers for the bottom two figures (with the lower-right quadrant in both being displayed as larger than the upper-right, despite having a lower number).

Lies, damned lies, statistics and misleading figures.

0: https://www.mckinsey.com/~/media/McKinsey/Industries/Financi...

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#106

Post by dawg- »

geodel wrote: post #92
Scoundreller wrote: post #64

Earlier quoted context omitted.

Sounds high. Top partners at law firms will have rates lower than that.

It is extra reward for those who help leveraging the synergies while paradigms go shifting.

What a dynamic observation!

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#107

Post by throwaway66920 »

DuskStar wrote: post #105
throwaway66920 wrote: post #25

I believe this is the actual article https://www.mckinsey.com/industries/financial-services/our-i... Broadly it seems to be less extreme than Bloomberg’s summary and more nuanced to particular conditions. I like how exhibit 6 is rotated to encourage reading it from either direction. Haven’t seen that before in charts.

Ugh, I hate it when people do things like Exhibit 4 [0] - the size and coloration of the boxes does not match the numbers for the bottom two figures (with the lower-right quadrant in both being displayed as larger than the upper-right, despite having a lower number). Lies, damned lies, statistics and misleading figures. 0: https://www.mckinsey.com/~/media/McKinsey/Industries/Financi...

I think I agree. It’s also just not a very good chart, error aside.

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#108

Post by esoterica »

PopeDotNinja wrote: post #99
rchaud wrote: post #50

Earlier quoted context omitted.

The difference is that in most cases, the shady mechanic is not somebody you already know from college, or from golf or your national frat society. McKinsey gets paid ungodly sums in part because they are the archetype of the old boy's club. Their new hires usually come only from top business schools, and likely already have several years under their belt at the types of companies McKinsey gets business from. In addi…

Here's the basic model: - McKinsey hires a bunch of "top" school grads - after a few years, some hires clearly have the potential to make partner, and most don't - McKinsey encourages clients to hire the people who aren't partner material at an attractive wage - feeling good about making a step up after capping out at McKinsey, most people gladly accept - McKinsey now has an alumni network at client's which are a goo…

Most people leave McKinsey willingly for greener pastures, not because they were not considered partner material and were forced out. People join consulting mostly for the exit opportunities, not because they strive to be lifers there

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#109

Post by telotortium »

esoterica wrote: post #108
PopeDotNinja wrote: post #99

Earlier quoted context omitted.

Here's the basic model: - McKinsey hires a bunch of "top" school grads - after a few years, some hires clearly have the potential to make partner, and most don't - McKinsey encourages clients to hire the people who aren't partner material at an attractive wage - feeling good about making a step up after capping out at McKinsey, most people gladly accept - McKinsey now has an alumni network at client's which are a goo…

Most people leave McKinsey willingly for greener pastures, not because they were not considered partner material and were forced out. People join consulting mostly for the exit opportunities, not because they strive to be lifers there

They don't have to be formally forced out, just realize that they're not likely to win the competition to be partner and move to other companies out of self-interest.

Re: McKinsey: Half the World’s Banks Too Weak to Survive Downturn

#110

Post by olivermarks »

McKinsey & Accenture could do with some anti trust investigation at this point, they have too much of the outsourced brain work and strategy of important western firms executed in a cookie cutter way that then exploits the inside knowledge for future projects. This banking prediction is an example of this type of thinking. McKinsey are the problem not the solution
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