I never said the rules were fair. If so, save it for dates and leisure time, at least if you work on Wall Street. The Epicurean Dealmaker. Main · Videos; Polyamory married and dating season 1 episode 5 tvtraxx match 1 dating site · epicurean dealmaker the rules dating · dating history of jake. Main · Videos; Speed dating in brisbane on saturday nights alright for fighting dating epicurean dealmaker the rules for dating austin powers mojo latino dating .
The Epicurean Dealmaker: November
Epicurean Dealmaker The Rules For Dating, Top Members (works)
They hold completely different life ambitions. This can be seen by the perhaps surprising absence of former investment bankers among the massively rich and successful entrepreneurs of the world. The entire fucking point of working 24 hours a day, for days on end, and canceling weeknight dates with Kate Upton, Las Vegas bachelor parties with George Clooney and Brad Pitt, and Christmas holidays with the Pope of all Christendom at the last possible minute is that the entire investment bank works at the pleasure and whim of clients who pay us a small fortune to do so.
That is why successful senior bankers never tell the client no. That is why we agree to impossible deadlines for ridiculous requests at the last minute.
The Epicurean Dealmaker
Because that is the fucking job. So telling some pissant college graduate or wet-behind-the-ears MBA she can futz off and take in a Broadway show, art gallery opening, or all-night drinking session in the East Village or West End from Friday night through Sunday morning does that person absolutely no good whatsoever.
Because it is telling her, incorrectly, that she should expect clients and bosses to respect the life-work boundaries of normal human beings in her life too. But none of these ever will, and if she wants and expects to make a success of herself in my industry, she better reconcile herself to that fact as soon as fucking possible. Then we tried fruit baskets, casual Fridays every day, and in-house concierges to pick up and deliver dry cleaning, Broadway tickets, and other bullshit in a desperate and ultimately fruitless attempt to prevent our most ambitious young Turks from joining such guaranteed future world beaters as Webvan or Pets.
None of it worked, since the true entrepreneurs or reckless idiots among our ranks lit out for the coast anyway, and the risk-averse remnants who stayed behind got utterly ruined by our coddling. It is no exaggeration to say an entire generation of potential investment bankers was ruined by such nonsense.
But that is the nature of large scale corporate investment banking nowadays. Later, banks began imposing more and more onerous vesting schedules and restrictions on bankers' deferred pay, typically preventing them from taking delivery of deferred stock for up to three years or even more from the year it was granted, and forcing any banker who resigned to join a competitor to forfeit unvested awards. Management's nominal argument for these practices was that they encouraged employee retention, making it difficult for bankers to job hop around the Street.
But if this was indeed the reason, it was a very blunt and usually ineffective instrument in practice. It certainly did little to prevent other banks from hiring your star performers, since all they had to do was "buy out" a banker's unvested pay with an equivalent amount of unvested stock and options of their own.
The only people these practices really encouraged to stay put were the average and even poor performers, who could not dream of getting bought out by a competitor. There was no clawback option in these plans, either, other than the nuclear option of confiscating an employee's unvested pay if he or she was fired for "cause," usually criminal.
On the positive side, a bank which lost a star performer to a competitor could take some consolation by canceling the departing employee's deferred pay—thereby reducing past and future compensation expense—or, more commonly, turn around and use the freed-up stock to poach some other bank's rainmaker.
As these banks bulked up their balance sheets to take advantage of larger and larger trading opportunities, traders on the prop desks began making bigger and bigger bets with more and more borrowed capital.
Twenty-five, fifty, even sixty million dollar paydays became regular occurrences, and caused no end of envy and hate among the traditional investment bankers who used to rule the roost on the Street. Of course, based on the old system of eating what you kill, those paychecks did make some crazy kind of sense. Top management of investment banks, who increasingly came from the capital markets side of the house themselves as profits from that division ballooned, began to rely heavily on the supercharged profits successful proprietary trading generated to meet growth targets and satisfy shareholders.
They did all they could to keep prop traders fat and happy, which became increasingly difficult as the independent hedge fund industry blossomed and any trader worth his salt could get a better bid away just by picking up the phone. In addition to corrosive pay envy from bankers on the other side of the wall, this system also exacerbated the age-old tensions between the agency side of the business and the principal side. It was no consolation that the offending trader was usually fired without a bonus.
Agency business—advising companies on mergers, underwriting stocks and bonds, and trading securities for clients' accounts—generates very little downside risk: Similarly, an investment bank is usually only on the hook for its commission and incidental losses if an IPO tanks immediately after the offering.
In contrast, principal activity can generate enormous losses, as we have all seen. This problem was compounded by the traditional Wall Street practice of paying bankers each year for the results they generated that year.
In fact, one could easily accuse the old system of making the reckless risk taking which has landed us in our current soup even worse. That way, when Lehman blew up, he was sitting pretty with stock in a firm not subject to those risks. One wonders whether some of these job-hopping superstars would have been quite so cavalier with their own bank's balance sheet if they knew that their net worth would remain exposed even if they swapped employers.
Its compensation practices either contributed to the mess or did nothing to prevent it. So where do we go from here?
The Epicurean Dealmaker: The Rules
First, I think we must realize that putting arbitrary pay caps on investment bankers and traders will be counterproductive. I don't think the Treasury does either, which is why the plan it proposed last week governing pay for senior executives at financial institutions suckling at the taxpayer's teat imposes no explicit limitations on total compensation for CEOs or anyone else.
Believe it or not, my friends, half a million in cash, before taxes, is a pretty skimpy wage to support a CEO-type lifestyle in New York City. Nevertheless, most of the people who will be looking for these jobs are rich already, and I am sure their personal fleet of accountants, compensation experts, and tax advisors will be able to find them enough of the folding to keep the wife and mistress in Prada. As long as they repay the Treasury, and repair their institutions, I see no reason why we shouldn't wish them Godspeed.
Furthermore, deferring the bulk of every banker's pay in like fashion makes eminent sense, too. But there are two reasons to disregard their complaints. First, one of the first things the walking wounded banks subject to these rules must do is re-equitize their balance sheets, and what better captive source of interest-free loans common equity is there than your employees?
Second, while bankers like these on the agency side of the business contribute little risk to the overall organization, they definitely draw a substantial portion of their legitimacy, stature, and revenue-generating capabilities from their firm's franchise. Locking them up with long-term deferred comp seems a modest price to pay for renting Goldman Sachs' or JPMorgan's good name, in my humble opinion, especially since the bid away is practically nonexistent.
Prop traders, of course, should be locked up until Kingdom come, or at least until the cows come home. The ideal solution, actually, would be to set up internal hedge fund accounting at each bank.
Track prop traders on their individual results, and pay them with long-vesting "shares" in their own trading book, just like real hedge fund managers. That'd align those little buggers, alright. Unfortunately, this solution is probably administratively unworkable, even if it is theoretically very neat.
As a distant second best, pay them in restricted shares of the parent bank that vest on a schedule which matches as closely as possible the long-term risk profile of their trading activities. Effectively structured, such a program would render bonus "clawbacks"—and all such similar proposals being floated in the court of public opinion right now—effectively moot.
Given their position at the top of the food chain, and their responsibility for using proprietary trading to dig their banks out of the holes they have put themselves in, senior executive management pay should be structured in the same way.
Of course, pushing the entire industry to deferred compensation will work much better if bankers can take their stock with them when they move.