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My Time at Lehman

nickchirls.com

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Re: My Time at Lehman

#121

Post by freyr »

danielna wrote: post #5

I have a strange sense of sadness for my friends who are "stuck" on Wall Street. Strange because it's weird to feel sad for someone making $250k+ per year, but I've heard their first hand accounts of how much they hate their jobs. If you're the type of person who can step back from the ego-driven culture of investment banking I feel like everyone reaches the same meta-conclusions that Nick did. It's just unbelievably…

> it's weird to feel sad for someone making $250k+ per year, but I've heard their first hand accounts of how much they hate their jobs.

Most people hate their jobs. And very few make $250k+ per year.

Investment bankers and traders are smart enough and rich enough to make a leap into a new career, if they really desired.

Your friends should grab a wad of $100 bills from each of their wallets, wipe away their tears, and do something proactive about their lives.

Re: My Time at Lehman

#122

Post by rayiner »

pm90 wrote: post #118
tomkarlo wrote: post #88

Earlier quoted context omitted.

Even if you paid more, the incentives are wrong. Managers are told (often by state legislatures) to go out and hit unrealistic return targets, because to lower the targets would mean the states have to fund the pension more. If they hit the target, they keep their job. If they miss their target, they get fired. What would you do? This is also why state pensions like to jam money into alternative investments like hedg…

This sounds like a very difficult situation! I didn't realize it was this complicated; I always wondered why pension fund managers were so gullible.

The pension fund managers are stuck between a rock and a hard place. States underfund pensions while state employees keep demanding ever larger retirement benefits. So as a result they have to seek insane returns on their portfolios.

Re: My Time at Lehman

#124

Post by rayiner »

nchirls wrote: post #51
jwb119 wrote: post #8

I worked at Lehman from 2004-2008 in investment banking and on the bond trading floor and I think I have a little more balanced view. Yes, there are people on wall street that hate their jobs. Yes, there are people obsessed with money. That's easy to point out. But there are also some people that are there because they like working with their friends and making big bets, and getting proven wrong or right. It's actual…

Appreciate this perspective. Not hard to imagine why working with friends would be fun. I have many friends who still work on Wall Street or in the financial industry. I don't disrespect them for it, although I do wish more young smart people were focused on making things rather than transacting. I tried to write this post specifically about MY experience and stay away from generalizations as much as possible.

> I don't disrespect them for it, although I do wish more young smart people were focused on making things rather than transacting.

It's six of one, half a dozen of another. You either peddle exotic financial instruments on Wall Street, or peddle advertising in Silicon Valley (or work on something like Glass or self-driving cars that's completely subsidized by advertising profits). I don't think there is anything more noble about finding new ways to convince people to buy cheap Chinese crap they don't need.

Re: My Time at Lehman

#125

Post by mynewwork »

tomkarlo wrote: post #91

I worked at Lehman for 4+ years (left in 2008) and while I didn't feel so negative about work (I was more senior than the OP) I definitely was in a spot where I knew that if I kept at it for another 10-20 years -- no matter how much money I made -- I would feel like I wasted my time. I went back to tech, and now I have a job where I'm still well paid by any reasonable standard, and I really enjoy what I work on and w…

I'm always curious when I hear things like "Lehman for 4+ years" because, based on the numbers thrown around on HN and blogs like this, it seems likely you could have a net worth over a million dollars.

While not the "F You" money many here dream of, it still seems like a few years on wall street would give you a nest egg that would make it easy to live comfortably on any other salary (whether that's tech or teaching or bartending).

Do many of wall streeters who left after 5ish years do that? Or do most of them blow all their money? I think being under 30, a millionaire and having $PRESTIGIOUS_FIRM on your resume would be a pretty good setup, even if the work itself sucked.

Re: My Time at Lehman

#126

Post by rayiner »

jnewell wrote: post #90

I cringed when I read this headline on HN because I too worked for Lehman between 2006 and 2008. I felt the same way Nick did even around the same time (wanting to go back to making "real things"). However, lately I feel like I have come back somewhat full-circle. Many of the issues he complains about is rampant in almost of every industry. For example, Groupon was basically taking advantage of unsophisticated small…

Bingo! All the interesting, financially-remunerative jobs these days for ambitious young people are bullshit. Not in the sense of not creating value (because I think there is value created in these industries), but because they are all open to criticism of this sort in one way or another.

Are you a rocket scientist? You probably make your money directly or indirectly from the military industrial complex. Are you a doctor? You'd make much less money if the AMA didn't artificially restrict the supply of doctors. Are you working in Silicon Valley? Your product is either based on ads, or is a side-project of some company that makes all its money on ads (e.g. Google, vis-a-vis Glass or self-driving cars).

It's not worth worrying about this shit. Do something you find interesting if not morally fulfilling, and try to make a lot of money doing it because we live in a country where your kids can't see a doctor unless you can write the checks.

Re: My Time at Lehman

#128

Post by tomkarlo »

mynewwork wrote: post #125
tomkarlo wrote: post #91

I worked at Lehman for 4+ years (left in 2008) and while I didn't feel so negative about work (I was more senior than the OP) I definitely was in a spot where I knew that if I kept at it for another 10-20 years -- no matter how much money I made -- I would feel like I wasted my time. I went back to tech, and now I have a job where I'm still well paid by any reasonable standard, and I really enjoy what I work on and w…

I'm always curious when I hear things like "Lehman for 4+ years" because, based on the numbers thrown around on HN and blogs like this, it seems likely you could have a net worth over a million dollars. While not the "F You" money many here dream of, it still seems like a few years on wall street would give you a nest egg that would make it easy to live comfortably on any other salary (whether that's tech or teaching…

That's not generally how it seems to work. For junior bankers under 30 (analysts and associates) you're making good money, but not such great money that you're putting away hundreds of thousands of dollars a year after your expenses and taxes. I can't recall ever hearing of someone saying, "I've worked 5 years, I've saved $500K, but instead of making $500K next year, I'm going to retire."

Also, the lifestyle (and partner, and kids) that you end up with while making banker money means that $1M is not remotely "quitting money", because it won't last long enough. I'd guess most folks would talk about $25M or $50M min for that in the industry, and you're not saving that anywhere below MD. Bankers have banker wives, banker mortgages, and their kids have banker tuitions. (One of my bosses had an $8M mortgage on a $12M home. That's ~$30K in mortgage payments a month... no way he could quit) I'm not saying anyone should feel bad for them, just the whole idea of "save up $1M and quit" doesn't make any sense in reality.

Finally, there's a lot of pride/ego/image folks have in their job and their job title, for better or worse. Even if it ruins their life. I didn't love being a banker, but I can't deny it's not fun telling folks you're an investment banker.

(Also, it's worth pointing out that people don't go work 100 hour weeks for years on end just so they can quit with $1M. They're doing it to have $10M or $100M.)

Re: My Time at Lehman

#129

Post by penny500 »

rayiner wrote: post #120
penny500 wrote: post #70

Earlier quoted context omitted.

Because for Wall Street to succeed, Main Street must fail? Why would Main Street transact with them at all if that were the case?

> Why would Main Street transact with them at all if that were the case? Because we force them to, through 401k's and the like.

What specific law are you referring to that forces Main Street to invest in 401Ks?

Re: My Time at Lehman

#130

Post by tomkarlo »

mapgrep wrote: post #110
tomkarlo wrote: post #102

Earlier quoted context omitted.

You're assuming that the occasional gigantic bankruptcy isn't a natural outcome of the smartest strategy as a bank. But when you're comped on this year's profits, and a large chunk of your comp is cash, it makes sense to take huge risks that result in near-term profit, or immense long-term profit, and largely ignore the potential for a total collapse. (Not to mention most of the employees found jobs at other banks, o…

You bring up a great point, which is actually an excellent alternative answer to OP's question, "what do you expect?" What we should expect is for banks to protect themselves as businesses by changing compensation to account for long term risk. And if they fail to do that organically, we should acknowledge that the market is failing in a dangerous way and more regulation around compensation is needed.

I don't know that you need to regulate compensation. You just need to not bail them out when they blow up, and it will self-correct. And you shouldn't let them gamble with federally insured (FDIC) money - either be a investment bank or a commercial bank, but not both, so that regular consumers don't get caught in the middle.
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