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Opinion | The Meritocracy Is Ripping America Apart
Sept. 12, 2019 | - The New York Times | By David Brooks.

savage exclusion tears the social fabric.

There are at least two kinds of meritocracy in America right now. Exclusive meritocracy exists at the super-elite universities and at the industries that draw the bulk of their employees from them — Wall Street, Big Law, medicine and tech. And then there is the more open meritocracy that exists almost everywhere else.

In the exclusive meritocracy, prestige is defined by how many people you can reject....The more the exclusivity, the thicker will be the coating of P.C. progressivism to show that we’re all good people.

People in this caste work phenomenally hard to build their wealth......People in this caste are super-skilled and productive.....These highly educated professionals attract vast earnings while everybody else gets left behind......Parents in the exclusive meritocracy raise their kids to be fit fighters within it....affluent parents invest on their kids’ human capital, over and above what middle-class parents can afford to invest......the Kansas Leadership Center. The center teaches people how to create social change and hopes to saturate the state with better leaders. But the center doesn’t focus on traditional “leaders.” Its mantra is: “Leadership is an activity, not a position. Anyone can lead, anytime, anywhere.” The atmosphere is one of radical inclusion.....People in both the exclusive and open meritocracies focus intensely on increasing skills. But it’s jarring to move from one culture to the other because the values are so different. The exclusive meritocracy is spinning out of control. If the country doesn’t radically expand its institutions and open access to its bounty, the U.S. will continue to rip apart.
Big_Law  caste_systems  Colleges_&_Universities  David_Brooks  elitism  exclusivity  hard_work  human_capital  inequality  law_firms  leadership  medicine  meritocracy  op-ed  parenting  political_correctness  social_classes  social_exclusion  social_fabric  social_impact  social_inclusion  society  technology  values  Wall_Street  winner-take-all 
7 days ago by jerryking
How a private equity boom fuelled the world’s biggest law firm
June 6, 2019 | Financial Times | James Fontanella-Khan and Sujeet Indap in New York and Barney Thompson in London.

Jeff Hammes took the helm at a Chicago-based law firm called Kirkland & Ellis in 2010, with the aim of turning it into a world-beater, few in the industry thought he stood a chance.......known as a good litigation firm in Chicago with a decent mid-market private equity practice, in the blockbuster dealmaking world, however, the firm was largely irrelevant. Nobody took them seriously on Wall Street.....Fuelled by explosive growth in private equity, aggressive poaching of talent and most of all, a business model that resembles a freewheeling investment bank, Kirkland has become the highest-grossing law firm in the world.....This rise reflects the shift in the financial world’s balance of power since the financial crisis. Investment banks, the dominant force before 2008, have been eclipsed by private equity firms, which now sit on hundreds of billions of dollars of investment funds.

Kirkland thrived by hitching itself to this dealmaking activity. The firm presents with a relentless — many say ruthless — focus on growth, a phenomenal work ethic and a desire to up-end what it sees as a lazy hierarchy. Key questions: can its winning streak can continue? Will its private equity clients continue to prosper? how will Kirkland cope if and when the private equity boom ends? And can a firm with such a hard-charging culture survive in the long run?....Robert Smith’s Vista Equity has grown to manage assets from $1bn to $46 in a decade while working with Kirkland.....To establish Kirkland as a major player, Mr Hammes turned his attention to recruitment. ....poaching proven M&A experts and targeting all areas of dealmaking.....To entice the best lawyers to join its ranks, Kirkland managed to exploit a structural rigidity in its more traditional white-shoe and magic circle rivals. A dwindling but still significant number of elite firms remunerate equity partners using a “lockstep” model......
Kirkland sought rising stars in their late thirties who were at the bottom of this ladder, stuck in the queue for the highest share of profits. Part of its pitch was money — “With compensation, we can go as high as we want,” says one partner — but the other part was an almost unprecedented level of autonomy.
Big_Law  booming  business_development  Chicago  compensation  concentration_risk  dealmakers  deal-making  eat_what_you_kill  financial_crises  growth  hard-charging  high-end  hiring  howto  hustle  Kirkland_Ellis  law  law_firms  litigation  mid-market  organizational_culture  poaching  private_equity  recruiting  Robert_Smith  superstars  talent  turnover  Vista  Wall_Street  winner-take-all  work_ethic  world-class 
june 2019 by jerryking
Michael Lewis Makes Boring Stuff Interesting - WSJ
May 17, 2019 | THE WALL STREET JOURNAL | By Richard Turner.

The writer’s new podcast ‘Against the Rules’ asks what has happened to fairness in the U.S.......Michael Lewis doesn’t really need this gig. His new podcast, “Against the Rules,” doesn’t pay anything close to his book-writing day job. It’s unlikely to turn into a movie. Plus, the podcast’s subject is pretty abstract: Who are the referees in our society? Who determines what is fair and even what is true? Is our whole system rigged from stem to stern, as everyone from President Donald Trump to sports fans to the Black Lives Matter movement insists?.....The idea ...is to examine “what’s happened to fairness” in an age when America’s arbiters are no longer trusted. The Walter Cronkites of the world are gone, and those assigned to make the tough calls are reviled, threatened and assumed (sometimes correctly) to be corrupt.....“It’s a big problem for democracy if people don’t have a shared reality,” Mr. Lewis says. “It’s difficult to establish a referee in an increasingly unequal environment” like today’s U.S., “when there are powerful parties and not-so powerful ones. .......Mr. Lewis’s skills turn out to be well-suited to the podcast medium. His calling card, echoed by untold critics and readers, is this: He makes boring stuff interesting. He collects disparate ingredients, whips them up with character and narrative, and distills human stories into engrossing big-picture explainers........Lewis keeps seeing failures of refereeing. “There was no referee at the interface between Wall Street and the consumers—consumer finance. I saw the birth of that, when Wall Street hit segments of society it had never touched, through subprime mortgages, for car loans, through asset-backed securities. There was no one saying, ‘That’s fair and that’s not.’”.......Among his topics: correct English usage, judges, used cars, identity theft, credit-card companies, student-loan abuses, Cambridge Analytica, King Solomon and the famed mediator Kenneth Feinberg, who handled victim compensation for 9/11 families and those affected by the 2010 BP oil spill. Listeners can imagine myriad future topics related to fairness: expanding the Supreme Court, machines calling balls and strikes, cable-news coverage of the Trump presidency and so on.
boring  consumer_finance  credit-ratings  democracy  failure  fairness  gaming_the_system  Michael_Lewis  NBA  podcasting  podcasts  refereeing  rules_of_the_game  shared_experiences  unglamorous  Wall_Street  writers 
may 2019 by jerryking
A Man for All Markets by Edward O. Thorp
by Edward Thorp, a mathematician who applied his skills, from Las Vegas to Wall Street, from the blackjack tables to the world of hedge funds.
books  hedge_funds  Las_Vegas  mathematics  quantitative  Wall_Street 
march 2019 by jerryking
The need for weed: why Wall Street is getting hooked on cannabis
MARCH 15, 2019 | Financial Times | by Nicole Bullock in New York.

a “sea change in attitude” towards the sector.  “You don’t get an opportunity every day to participate in the very early stages of the creation of a large global industry and that is what is happening now,”
Aurora  Cambrian_explosion  cannabis  Canopy_Growth  FDA  investors  start_ups  Wall_Street 
march 2019 by jerryking
How a Former Canadian Spy Helps Wall Street Mavens Think Smarter
Nov. 11, 2018 | The New York Times | By Landon Thomas Jr.

* “Atomic Habits: An Easy and Proven Way to Build Good Habits and Break Bad Ones,” by James Clear. “
* “The Laws of Human Nature,” an examination of human behavior that draws on examples of historical figures by Robert Greene.
* “Thinking in Bets: Making Smarter Bets When you Don’t Have All the Cards” by Annie Duke,
* “On Grand Strategy,” an assessment of the decisions of notable historical leaders by the Pulitzer Prize-winning biographer John Lewis Gaddis

Shane Parrish has become an unlikely guru for Wall Street. His self-improvement strategies appeal to his overachieving audience in elite finance, Silicon Valley and professional sports.....Shane Parrish is a former cybersecurity expert at Canada’s top intelligence agency and an occasional blogger when he noticed something curious about his modest readership six years ago: 80 percent of his followers worked on Wall Street......The blog was meant to be a method of self-improvement, however, his lonely riffs — on how learning deeply, thinking widely and reading books strategically could improve decision-making skills — had found an eager audience among hedge fund titans and mutual fund executives, many of whom were still licking their wounds after the financial crisis.

His website, Farnam Street, urges visitors to “Upgrade Yourself.” In saying as much, Mr. Parrish is promoting strategies of rigorous self-betterment as opposed to classic self-help fare — which appeals to his overachieving audience in elite finance, Silicon Valley and professional sports. ....Today, Mr. Parrish’s community of striving financiers is clamoring for more of him. That means calling on him to present his thoughts and book ideas to employees and clients; attending his regular reading and think weeks in Hawaii, Paris and the Bahamas; and in some cases hiring him to be their personal decision-making coach......“We are trying to get people to ask themselves better questions and reflect. If you can do that, you will be better able to handle the speed and variety of changing environments.”....Parrish advises investors, to disconnect from the noise and to read deeply......Few Wall Street obsessions surpass the pursuit of an investment edge. In an earlier era, before computers and the internet, this advantage was largely brain power. Today, information is just another commodity. And the edge belongs to algorithms, data sets and funds that track indexes and countless other investment themes.......“It is all about habits,” “Setting goals is easy — but without good habits you are not getting there.”......“Every world-class investor is questioning right now how they can improve,” he said. “So, in a machine-driven age where everything is driven by speed, perhaps the edge is judgment, time and perspective.”
books  Charlie_Munger  coaching  commoditization_of_information  CSE  cyber_security  decision_making  deep_learning  disconnecting  financiers  gurus  habits  investors  life_long_learning  overachievers  personal_coaching  questions  reading  reflections  self-betterment  self-improvement  slight_edge  smart_people  Wall_Street  Warren_Buffett  Pulitzer_Prize 
november 2018 by jerryking
Walmart tells investors to expect more risk-taking
October 16, 2018 | Financial Times | Alistair Gray and Pan Kwan Yuk in New York.

Doug McMillon said at an investor meeting on Tuesday that the Arkansas-based company was experimenting with technology ranging from floor-cleaning robots to augmented reality and biometrics as he urged Wall Street to “challenge your thinking about Walmart”.

Walmart superstores have transformed shopping habits and became a dominant force in American retail. The bricks-and-mortar model, however, has been upended in by the rise of ecommerce.

“Looking back, we had a proven model, and we naturally focused on execution. As the numbers grew, we . . . unintentionally became risk averse,” Mr McMillon said at a meeting for investors.

“But today we’re getting to reimagine retail and our business. To do that we take risk — try quite a few things and learn from our failures. That type of behaviour’s in our DNA, and we’re waking up that part of our culture.”.....Online sales, in which Walmart has been investing aggressively as part of its response to Amazon, are expected to increase around 35 per cent for the fiscal 2020 year, compared to the expected 40 per cent for 2019.

Walmart also on Tuesday struck a partnership with Advance Auto Parts, allowing it increase its presence in the car parts business. Under the tie-up the companies will offer home delivery, same-day pick up at each other’s stores and installation of some parts.
Amazon  e-commerce  experimentation  failure  innovation  retailers  risk-taking  Wall_Street  Wal-Mart  augmented_reality  auto_parts  biometrics  bricks-and-mortar  home-delivery  same-day  shopping_habits 
october 2018 by jerryking
Paul Singer, Doomsday Investor
August 27, 2018 | The New Yorker | By Sheelah Kolhatkar.

Paul Singer, ,
The head of hedge fund Elliott Management, has developed a uniquely adversarial, and immensely profitable, way of doing business.

Bush had co-founded Athenahealth, a platform that digitizes patient medical records and billing claims for hospitals and health-care providers, in 1999, and he had built it into an enterprise with more than a billion dollars in revenue. One of the firm’s marketing taglines was that it freed doctors and nurses to spend more time doing what they loved—practicing medicine—and less time on paperwork. Athena served more than a hundred thousand health-care providers...... Paul Singer, the founder of Elliott Management and one of the most powerful, and most unyielding, investors in the world. Singer, who is seventy-three, with a trim white beard and oval spectacles, is deeply involved in everything Elliott does. The firm has many kinds of investments, but Singer is best known as an “activist” investor, using his fund’s resources—about thirty-five billion dollars—to buy stock in companies in which it detects weaknesses. Elliott then pressures the company to make changes to its business, with the goal of improving the stock price.....Hedge funds, especially activist hedge funds, are established users of private-investigation services.....The investor acknowledged that Bush was far from perfect, and said that “there is a role for activists to hold managements accountable.” But the investor worried that the focus on the bottom line would undermine the innovative spirit that had made Athena successful. “.....The idea that companies exist solely to serve the interests of shareholders—rather than also to serve workers, customers, and the larger community—has been dominant in the business world in the past thirty years. As the field of activist investing becomes increasingly crowded, many investors are going beyond their original mission of finding ailing or mismanaged companies and pushing them to improve. Instead, some have been targeting larger, financially prosperous companies, such as Procter & Gamble, Apple, and PepsiCo. ......Often, activists advocate for measures that drive up the stock price but can have negative effects in the future, such as the outsourcing of jobs, the elimination of research and development, and the borrowing of money to buy back a company’s own stock. The wisdom of these tactics has come under increasing scrutiny. Some of the most successful businesses to emerge in recent decades have staved off short-term pressures, forcing their investors to be patient with uncertainty and experimentation. The founder of Amazon, Jeff Bezos, wrote in an early investor letter that building something new “requires you to experiment patiently, accept failures, plant seeds, protect saplings.” ........Over time, this lack of long-term vision alters the economy—with profound political implications. Businesses are the engine of a country’s employment and wealth creation; when they cater only to stockholders, expenditures on employees’ behalf, whether for raises, job training, or new facilities, come to be seen as a poor use of funds. Eventually, this can result in fewer secure jobs, widening inequality, and political polarization. ..........Bush spoke about his last day in the office, when he had sobbed during his final address to Athena’s employees. He had also written a farewell letter. “I believe that working for something larger than yourself is the greatest thing a human can do. A family, a cause, a company, a country—these things give shape and purpose to an otherwise mechanical and brief human existence,” the letter read. “The downside about things that are larger than ourselves, of course, is that we who have the privilege of serving them ourselves are fungible. It is the fundamental definition. You can’t have the grace of the one without the other......Throughout our conversations, Bush returned to a theme that consumed him. He talked about how investors like Singer—financiers who take the assets built by others and manipulate them like puzzle pieces to make money for themselves—are affecting the country on a grand scale. A healthy country, he said, needs economic biodiversity, with companies of different sizes chasing innovation, or embarking on long, hard projects, without being punished. The disproportionate power of the Wall Street investor class, Bush felt, dampened all that, and gradually made the economy, and most of the people in it, more fragile.
shareholder_activism  Wall_Street  Sheelah_Kolhatkar  profile  investors  financiers  vulture_investing  hedge_funds  distressed_debt 
august 2018 by jerryking
Big Investors Don’t Want Wall Street Analysts Snooping on Them - WSJ
June 14, 2018 | WSJ | By Telis Demos

the research shops are finding ways to make up the lost revenue, turning to readership data. They do say that information is power, and in this case I guess the banks have the power again.
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I think the WSJ is conflating two very different issues. The privacy concerns apply on ethical (possibly criminal) grounds rather than moral ones, in the example given of hedge funds asking a broker to provide aggregated readership data. It's very hard to imagine a responsible research provider doing this. The other piece - the tracking of utilization of research product is exactly what brokers need to do to ensure they are being paid appropriately for the level of service a client is receiving. MiFID 2 has and will continue to put pressure on how much research clients consume, and to precisely account for how much they pay for it. Transparency is a two-way street. A 90-day embargo on the readership data is a simple solution, as quarterly/bi-annual reviews should suffice to true-up the bank/client ledger.

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behavioural_data  investment_research  institutional_investors  reading  research_analysts  snooping  traders  Wall_Street  buy_side  informational_advantages  privacy  transparency 
june 2018 by jerryking
Opinion | Robert E. Rubin: Philosophy Prepared Me for a Career in Finance and Government - The New York Times
By Robert E. Rubin

Mr. Rubin was secretary of the Treasury from 1995 to 1999.

April 30, 2018

Raphael Demos. Professor Demos, an authority on Greek philosophy, was Harvard’s Alford Professor of Natural Religion, Moral Philosophy and Civil Policy. But to me, when I took a class with him my sophomore year, he was a genial little man with white hair and an exceptional talent for engaging students from the lecture hall stage, using an overturned wastebasket as his lectern. Professor Demos would use Plato and other great philosophers to demonstrate that proving any proposition to be true in the final and ultimate sense was impossible. His approach to critical thinking planted a seed in me that grew during my years at Harvard and throughout my life. The approach appealed to what was probably my natural but latent tendency toward questioning and skepticism.

I concluded that you can’t prove anything in absolute terms, from which I extrapolated that all significant decisions are about probabilities. Internalizing the core tenet of Professor Demos’s teaching — weighing risk and analyzing odds and trade-offs — was central to everything I did professionally in the decades ahead in finance and government.......Demos crystallized for me the power of critical thinking: asking questions, recognizing that there are no provable certainties and analyzing the probabilities. And that, coupled with my coffeehouse lessons, was the best preparation one could have — not just for a career but also for life.
Robert_Rubin  Colleges_&_Universities  Harvard  philosophers  philosophy  Plato  Wall_Street  Goldman_Sachs  career_paths  advice  life_skills  probabilities  decision_making  critical_thinking  U.S.Treasury_Department  Greek  tradeoffs 
may 2018 by jerryking
A Sidelined Wall Street Legend Bets on Bitcoin
April 16, 2018 Issue | The New Yorker | By Gary Shteyngart.
A Sidelined Wall Street Legend Bets on Bitcoin
Michael Novogratz is searching for redemption in cryptocurrencies.
Wall_Street  Bitcoin  Goldman_Sachs  digital_currencies  currencies  virtual_currencies  metacurrencies  crypto-currencies 
april 2018 by jerryking
A Rainmaker Seeks to Grow His Firm at a Time of Big Media and Tech Deals - The New York Times
By MICHAEL J. de la MERCEDDEC. 17, 2017

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rainmakers  John_Malone  moguls  dealmakers  investment_banking  boutiques  Wall_Street 
december 2017 by jerryking
Marty Chavez Muses on Rocky Times and the Road Ahead
NOV. 14, 2017 | - The New York Times | By WILLIAM D. COHAN.

Mr. Chavez is about as far from the stereotypical Wall Street senior executive as you can imagine, and that is one reason his musings about the future direction of Wall Street are listened to carefully.

He grew up in Albuquerque, one of five children, who all went to Harvard. He got a doctorate in medical information sciences from Stanford University. (At that time, he was known by his full name Ramon Martin Chavez.)

In 1990, Mr. Chavez came out, the day after he defended his doctoral dissertation. – “Architectures and Approximation Algorithms for Probabilistic Expert Systems.” He is one of the few openly gay executives on Wall Street. ......In his current role as Goldman's CFO, Marty views his job as a simple one that is hard to get right: “I’m not paid or evaluated on the accuracy of my crystal-ball predictions,” he said. “I’m paid to enumerate every possible outcome and do something about every possible outcome well in advance, when it’s still possible to do something, because once it’s happened it’s too late.”....Unlike many of his peers on Wall Street, Mr. Chavez does not complain about the extent of the regulation that hit the financial industry as a result of Dodd-Frank. Generally speaking, he says, the regulations have helped banks “confront their problems and capitalize and bolster their liquidity,” making them “stronger as a result,” and the financial system safer and more profitable.....Instead of complaining about the extra expense and manpower required to comply with the mountain of new regulations, Mr. Chavez chooses instead to think about it differently. “If you approach the regulations as ‘Oh, we’ve got to comply,’ you’ll get one result,” he said. He prefers thinking about the regulations as, “This makes us and the system and our clients safer and sounder, and yes it’s a lot of work, but what can we learn from this work and how can we use this work in other ways to make a better result for our shareholders and our clients? Everywhere we look we’re finding these opportunities and they’re very much in keeping with the spirit of the times.”

Like any good senior Goldman executive, he does worry. (Lloyd Blankfein, the Goldman chief executive, once told me he spent 98 percent of his time worrying about things with a 2 percent probability.)

His biggest concern at the moment is the risk of “single points of failure” in the vast world of cybersecurity. He worries about any individual “repository of information” that does not have a backup and that can “be hacked.”

He does not even trust Goldman’s own computer system; he treats it as a potential enemy.

.....What also makes Goldman different from its peers is the firm’s love affair with engineers. At the moment, he said, engineers comprise around 30 percent of Goldman’s work force of about 35,000. It’s what drew him to Goldman in the first place — to work on Goldman’s in-house software, “SecDB,” short for “Securities Database,” an internal, proprietary computer system that tracks all the trades that Goldman makes and their prices, and regularly monitors the risk that the firm faces as a result.

He said the system generates some million and a half points of data that were used to calculate, for the first time, the firm’s “liquidity coverage ratio” — now 128 percent — and that were shared with regulators every day. He’s been busy trying to figure out how the newly generated data can be used to help him understand what the firm’s liquidity will be a year from now.

That way, he said, in his principal role as Goldman’s chief financial officer, he can perceive a problem in plenty of time to do something about it. “We’re able to get much better actionable insights that make the firm a less risky business because we’re able to go much further out into the future,” he said......
actionable_information  CFOs  cyber_security  databases  Dodd-Frank  engineering  financial_system  Goldman_Sachs  improbables  information_sources  jujutsu  Martin_Chavez  proprietary  regulation  SecDB  SPOF  think_differently  Wall_Street  William_Cohan  worrying 
november 2017 by jerryking
After 20 Years of Financial Turmoil, a Columnist’s Last Shot - The New York Times
By GRETCHEN MORGENSON NOV. 10, 2017

For the past 20 years or so, as a business columnist for The New York Times, I’ve had a front-row seat for bull and bear markets, scandals, crises and management mischief.

But I am leaving The Times, and this is my last shot at Fair Game. So it seems a fitting moment to look back at what’s changed and what hasn’t in the financial world, for better or worse.

In addition to a string of garden-variety banking and business scandals, four seismic financial events occurred during my time as a columnist: the collapse of the Long-Term Capital Management hedge fund in 1998, the bursting of the dot-com bubble in 2000, the accounting scandals of Enron in 2001 and WorldCom in 2002, and the mother of them all — the mortgage debacle — in 2008. That one brought world economies to the precipice and wiped out Lehman Brothers and a raft of troubled banks.

......“Sarbanes-Oxley came into effect 15 years ago, and there have been fewer accounting scandals and more accountability,”...It’s too bad that the mortgage crisis six years later didn’t result in heightened accountability.

Here’s another sign of progress: Believe it or not, corporate directors are more active in their oversight than they used to be. Egregious board practices and chummy appointments are less common......Something else that hasn’t changed over the decades is analyst and investor reliance on companies’ creative earnings calculations. These figures, which do not conform to generally accepted accounting practices, typically exclude costs that companies incur in their operations.....Inventive earnings calculations, while more prevalent today, were very popular in the lead-up to the dot-com crash. Back then, analysts valued companies based on imaginative, nonfinancial metrics like the number of page views a retail website received or the percentage of “engaged shoppers” visiting a site. ....My search for truths on Wall Street and elsewhere over the years has sometimes raised hackles. That’s to the good. It wasn’t my job to be part of a company’s spin machine.
financial_communications  farewells  NYT  women  retrospectives  Wall_Street  seismic_shifts  LTCM  bubbles  scandals  SOX  truth-telling  boards_&_directors_&_governance 
november 2017 by jerryking
The Future Is Dodgeball -
Nov. 5, 2017 | WSJ | By Andy Kessler.

Ben Rosen rambled on about getting in the middle of things at events, conferences and seminars. He said that at first nothing will make sense and all these balls will be flying across the room out of your reach. But eventually you’ll find yourself in the middle of the room and balls will start hitting you. Then you’ll know you’re inside....Turns out it was the best advice I would ever receive.

The thing about the future is that, as William Goldman wrote about screenwriting, “Nobody knows anything.” Everyone is an outsider, and it’s all up for grabs. Someone might have an opinion, but there are few facts. What you need are your own opinions about where the world is headed in any given industry: artificial intelligence, gene editing, autonomous trucks, marine salvage—whatever.

You need to go to places where the future is discussed. Every industry has these events. Make the time to go. And not only to hear keynoters billow hot air, but for the panel discussions where people disagree. The conversation spills out into the hallways between talks..... Barge in anyway. Remember, there are no facts, only opinions.

Walk up and talk to people. Ask what they do. They’re there because they want to learn something too. They will all ask you what you think. Come up with something fast, but don’t be too stubborn to change what you think as you learn more. During the personal-computer era I saw a guy, whom Bill Gates had just introduced, standing by himself after showcasing the first truly high-resolution videogame. I chatted him up and he has been a friend for life, showing me not only where technology is headed but the path it takes.

It’s not classic networking but a network of ideas. The goal is finding a new way to think, to filter news over time as the future takes shape in fits and starts. It never happens in a straight line. Hydraulic fracturing has been around and argued about since 1947. Anyone had a chance to study this future of unlocking natural gas and make a fortune. Same for artificial intelligence in 1956, e-commerce in 1979 and quantum computing in 1982.

The future doesn’t happen overnight. You just need to get inside it and let some of those balls whizzing by start to hit you. And you’ve got to do this in person. Most issues don’t show up online, let alone on Facebook or Twitter . It’s tough as a writer to admit that subtle nuances sometimes require face-to-face conversation.

It doesn’t matter if you’re 25, 45 or 65. The industry you pick to work in has more of a say in your success than your job description. Same for giving money away. If you want to fund Alzheimer’s research, you better find yourself at wonky conferences going toe-to-toe with doctors. Eventually, you’ll know more.

I met Jeff Bezos at a tech conference about a decade ago and mentioned that I had just self-published a book and used his Amazon Advantage program to sell it. He proceeded to grill me like a steak, asking what was wrong with it and what features he should add. I’m convinced he keeps winning because he enjoys being hit with dodgeballs. He famously left New York a retailing outsider with an idea to sell books. Balls whizzed by until they hit. He now has the ultimate inside view.

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“Play in traffic.”.....“It means that if you go push yourself out there and you see people and do things and participate and get involved, something happens,” he said. “Both of my great occasions in life happened by accident simply because I showed up.”“I tell people, just show up, get in the game, go play in traffic,” Mr. Plumeri said. “Something good will come of it, but you’ve got to show up.”
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Andy_Kessler  '80s  Wall_Street  Morgan_Stanley  Communicating_&_Connecting  conferences  panels  future  small_talk  face2face  independent_viewpoints  action-oriented  ice-breakers  advice  playing_in_traffic  industry_expertise  straight-lines  Jeff_Bezos 
november 2017 by jerryking
Pentagon Turns to High-Speed Traders to Fortify Markets Against Cyberattack
Oct. 15, 2017 7| WSJ | By Alexander Osipovich.

"What it would be like if a malicious actor wanted to cause havoc on U.S. financial markets?".....Dozens of high-speed traders and others from Wall Street are helping the Pentagon study how hackers could unleash chaos in the U.S. financial system. The Department of Defense’s research arm, DARPA, over the past year and a half has consulted executives at high-frequency trading firms and quantitative hedge funds, and people from exchanges and other financial companies, participants in the discussions said. Officials described the effort, the Financial Markets Vulnerabilities Project, as an early-stage pilot project aimed at identifying market vulnerabilities.

Among the potential scenarios: Hackers could cripple a widely used payroll system; they could inject false information into stock-data feeds, sending trading algorithms out of whack; or they could flood the stock market with fake sell orders and trigger a market crash......Among potential targets that could appeal to hackers given their broad reach are credit-card companies, payment processors and payroll companies such as ADP, which handles the paychecks for one in six U.S. workers, participants said.....The goal of Darpa’s project is to develop a simulation of U.S. markets, which could be used to test scenarios, Such software would need to model complex, interrelated markets—not just stocks but also markets such as futures—as well as the behavior of automated trading systems operating within them....Many quantitative trading firms already do something similar.......
In 2009, military experts took part in a two-day war game exploring a “global financial war” involving China and Russia, according to “Currency Wars: The Making of the Next Global Crisis,” a 2011 book by James Rickards. ....“Our charge at Darpa is to think far out,” he said. “It’s not ‘What is the attack today?’ but ‘What are the vectors of attack 20 years from now?’”
Pentagon  financial_markets  financial_system  vulnerabilities  DARPA  traders  hedge_funds  Wall_Street  hackers  books  rogue_actors  scenario-planning  cyber_security  cyber_warfare  cyberattacks  high-frequency_trading  pilot_programs  contagions 
october 2017 by jerryking
With Deal-Making in the Doldrums, Goldman Tries Something New - The New York Times
OCT. 11, 2017 | WSJ | By JOHN FOLEY.

Goldman Sachs is trying to extricate itself from a box by thinking outside it. The Wall Street firm has set up a small team in what’s known internally as the Innovation Lab, to cook up supposedly clever ideas for big clients. The resulting acquisitions may end up destroying value for the shareholders of the companies involved, but Goldman’s own investors should be pleased the investment bank is trying new things.
innovation  Goldman_Sachs  idea_generation  experimentation  trading  Wall_Street  investment_banking 
october 2017 by jerryking
My top 5 investing lessons after 30 years as an economist
September 25th | The Globe and Mail | DAVID ROSENBERG.

After 30 years of experience as a Street economist, you pick up a lot of learning lessons – especially from the mistakes made along the way. Here are my top five below:

* Don’t put all your eggs in one basket (concentrated portfolios but diversified geographically and across the asset classes);
* There is no such thing as a sure thing (the forecast is just a base case across a continuum of possibilities across a distribution curve);
* Marry your partner, not your forecast – it may not love you back (what gets economists into trouble is lack of humility; admitting you’re wrong is never easy);
* If you don’t have a Plan B, you don’t have a plan. If you are wrong, it is imperative to know in what direction – and delineate the new course of action;
* Anything that can’t last forever, won’t last forever.
concentration_risk  economists  investing  lessons_learned  Plan_B  diversification  Bay_Street  Wall_Street  market_corrections  bear_markets  mistakes  forecasting  economic_cycles  beyondtheU.S.  Gluskin_Sheff  David_Rosenberg  probabilities  humility  contingency_planning  never_forever  asset_classes 
september 2017 by jerryking
SEC Chief Wants Investors to Better Understand Cyberrisk - WSJ
Sept. 5, 2017 | WSJ | By Dave Michaels.

The chairman of the Securities and Exchange Commission said Tuesday that regulators and Wall Street need to do more to educate investors about the serious risks that companies and the financial system face from cyberintrusions.

Jay Clayton, speaking at an event sponsored by New York University’s School of Law, said investors still don’t fully appreciate the threat posed by hackers. “I am not comfortable that the American investing public understands the substantial risk that we face systemically from cyber issues and I would like to see better disclosure around that,” Mr. Clayton said.
SEC  cyber_security  cyberthreats  cyberrisks  risks  hackers  cyberintrusions  regulators  Wall_Street  data_breaches  disclosure  under_appreciated  financial_system 
september 2017 by jerryking
Wall Street to CEOs: Disrupt Your Industry, or Else
May 26, 2017 | WSJ | By Christopher Mims

Investors and boards are hunting for corporate leaders who can move quickly to fend off upstarts and place big bets on disruptive tech.......For pretty much any industry you can name—not just autos but manufacturing, logistics, finance, media and of course retail—there are tech startups purporting to have better ideas, ones they say they don’t need decades to make into realities. It isn’t as if all these industries will see massive CEO turnover, but it does mean established companies need to consider drastic measures. They must be willing to tell their stakeholders they may have to lose money and cannibalize existing products and services, while scaling up new technologies and methods.

“Ten years ago, innovation was based on features and functions,”. “Now it’s about your business model and transforming your industry.”

Before, companies could innovate by acquiring tech startups. But the top disrupters now grow so quickly and capture so much market share, they become too valuable to buy or are unwilling to sell.....Act faster to satisfy shareholders.....Mickey Drexler, CEO of beleaguered J. Crew, admitted that if he could go back 10 years, he might have done things differently, to cope with the rapid transformation of retail by e-commerce. Who then would have predicted that in 2017, the No. 1 online retailer of clothing to millennials would be Amazon?....CEO turnover isn’t necessarily the only solution on the table....Companies also have to incubate potentially disruptive startups within their own corporate structures. This means protecting them as they develop, and being willing to absorb their losses for as long as their competitors do. Consider, for example, that Amazon made almost no profit for its first 20 years..... Wal-Mart’s e-commerce division increased sales 29% from a year earlier. Many analysts thought the company overpaid for Jet.com, which cost it $3.3 billion in August 2016. But the acquisition brought e-commerce veteran Marc Lore, who became chief executive of Wal-Mart’s online operations and quickly replaced existing executives with members of his own team.
analog  business_models  CEOs  Christopher_Mims  disruption  e-commerce  leaders  LVMH  operational_tempo  risk-taking  transformational  turnover  Jet  Wal-Mart  Wall_Street 
may 2017 by jerryking
Wall Street’s Endangered Species: The Ivy League Jock - WSJ
BY JUSTIN BAER

The industry started to shift away from athletes in the 1990s as derivatives grew in number and complexity. That necessitated a hiring spree for Ph.D.s who could understand and price them. More recently, the advent of electronic trading and quantitative investing called for many more recruits with math or computer-programming skills.
talent  athletes_&_athletics  Wall_Street  Ivy_League  quants  hiring  PhDs  trading  endangered 
may 2017 by jerryking
An Activist Investment in Whole Foods Exposes Shifting Power on Wall St. - The New York Times
APRIL 25, 2017 | NYT | By ALEXANDRA STEVENSON.

Neuberger Berman has eschewed its nearly 80-year-old tactic of playing nice (i.e. buy and hold stocks, sit back, and hope for the best), turning to the bare-knuckled world of activist investors made famous by the likes of Carl C. Icahn and William A. Ackman. Last year, as Neuberger Berman’s roughly $200 million investment in Whole Foods Market languished, the firm quietly approached some hedge funds and urged them to agitate for change at the high-end grocer. Two weeks ago, Jana Partners took up the fight......Neuberger Berman’s behind-the-scenes campaign to shake up Whole Foods is the latest example of a dynamic that is upending relations between public companies and the big investors that own their stock.....a reflection of the shifting balance of power on Wall Street....Traditional money managers in search of market-beating returns are demanding a seat at the table, turning to activists for help and even employing some hedge fund tricks of their own. And activists, once the black sheep of the investment world, are now accepted as regular, if meddlesome, investors. ....[Activist investors], she added, “[are an] important ‘check and balance’ on management that has lost its way.”....Neuberger Berman executives prepared an inch-thick presentation--a thorough critique--the kind of document usually produced by activists.....failures in how Whole Foods handled its brand development, and to what it said were customer service deficiencies and a poor strategy for distribution......Relations between institutional investors and activists have evolved in recent years, and it is not unheard-of for big investors to support activists who have set their sights on a high-profile company. ..... be careful of what you wish for, Neuberger Berman discovered that utilizing board seats on an underperforming portfolio company can be "expensive and time-consuming.”.....it is less common for an institutional investor to share its work on a specific target with activists in the way Neuberger Berman did with Whole Foods....There is even a term for the interplay: “R.F.A.s” or “requests for activism.”....Institutional investors do not make investments predicated on an activist showing up.
Wall_Street  money_management  shareholder_activism  beat_the_market  hedge_funds  Whole_Foods  Jana_Partners  Neuberger_Berman  institutional_investors  checks_and_balances  Carl_Icahn  William_Ackman  boards_&_directors_&_governance 
april 2017 by jerryking
With 125 Ph.D.s in 15 Countries, a Quant ‘Alpha Factory’ Hunts for Investing Edge - WSJ
By BRADLEY HOPE
Updated April 6, 2017

The firm is part of the forefront of a new quantitative renaissance in investing, where the ability to make sense of billions of bits of data in real time is more sought after than old-school financial analysis.

“Brilliance is very equally distributed across the world, but opportunity is not,” said Mr. Tulchinsky, a 50-year-old Belarusian. “We provide the opportunity.”

To do this, WorldQuant developed a model where it employs hundreds of scientists, including 125 Ph.D.s, around the world and hundreds more part-time workers to scour the noise of the economy and markets for hidden patterns. This is the heart of the firm. Mr. Tulchinsky calls it the “Alpha Factory.”....Quantitative hedge funds have been around for decades but they are becoming dominant players in the markets for their ability to parse massive data sets and trade rapidly. Amid huge outflows, traditional hedge funds are bringing aboard chief data scientists and trying to mimic quant techniques to keep up, fund executives say.

Some critics of quants believe their strategies are overhyped and are highly susceptible to finding false patterns in the noise of data. David Leinweber, a data scientist, famously found that the data set with the highest correlation with the S&P 500 over a 10-year period in the 1990s was butter production in Bangladesh.
quantitative  Wall_Street  PhDs  alpha  investors  slight_edge  massive_data_sets  signals  noise  data_scientists  real-time  algorithms  patterns  sense-making  quants  unevenly_distributed  WorldQuant 
april 2017 by jerryking
‘An Anthropologist on Wall Street’ — Cultural Anthropology
Tett, Gillian. "‘An Anthropologist on Wall Street’." Theorizing the Contemporary, Cultural Anthropology website, May 16, 2012.

Anthropology can be extremely useful for understanding the contemporary financial world because of all the micro-level communities—or ‘tribes’ to use the cliché term—that are cropping up around the financial system....The event pulled together bankers from all over. They staged formalized rituals with PowerPoint presentations, but also engaged in informal rituals like chitchat in the wings.

As they came together and talked, these bankers were creating a network of ties. But they were also inventing a new language they felt made them distinctive from everyone else. The way they talked about credit was to emphasize the numbers and to quite deliberately exclude any mention of social interaction from the debate and discussion. In the first couple of days I sat there, they almost never mentioned the human borrower who was at the end of that securitization chain. They were also very exclusive. There was a sense that ‘we alone have mastery over this knowledge’....Part two of the CDO gospel was that bankers had had this sudden inspiration that they should stop concentrating credit risk and find ways to scatter it across the system....Looking back there were many elements of securitization that were evidently flawed. The tools bankers were using to disburse risk across the system were themselves very opaque and complex. The very way by which they disbursed risk was actually introducing new risk into the system.......fundamental contradiction at the very heart of the system that almost nobody spotted. Why not? To put it crudely, because there were too few anthropologists, using basic anthropological techniques, trying to understand what was going on. Having an anthropological perspective is very useful. The very nature of anthropology is to try to connect up the dots. That’s something that most modern bureaucrats, most bankers, and most company executives are not able to do, precisely because they’re so darn busy running around in their silos.
Wall_Street  Gillian_Tett  anthropologists  financial_system  securitization  finance  ethnographic  insights  CDOs  connecting_the_dots  cultural_anthropology  anthropology  tribes  silo_mentality 
march 2017 by jerryking
An Insider-Trading Tale That Reads Like a Thriller - The New York Times
By ANDREW ROSS SORKINFEB. 7, 2017

“Black Edge: Inside Information, Dirty Money, and the Quest to Bring Down the Most Wanted Man on Wall Street,”
nonfiction  hedge_funds  Andrew_Sorkin  books  slight_edge  insider_trading  informational_advantages  Wall_Street  Preet_Bharara  SAC_Capital  Steven_Cohen  book_reviews  white-collar_crime  Sheelah_Kolhatkar 
february 2017 by jerryking
When the Feds Went After the Hedge-Fund Legend Steven A. Cohen - The New Yorker
ANUARY 16, 2017 ISSUE
WHEN THE FEDS WENT AFTER THE HEDGE-FUND LEGEND STEVEN A. COHEN
Inside the government’s nearly ten-year battle against one of the most powerful men on Wall Street.
By Sheelah Kolhatkar
Wall_Street  Preet_Bharara  insider_trading  hedge_funds  SAC_Capital  Steven_Cohen  white-collar_crime  nonpublic  Sheelah_Kolhatkar 
january 2017 by jerryking
Goldman breaks tradition with unconventional choice
December 17/ December 18, 2016 | Financial Times | Ben McLannahan.

His promotion to chief information officer in 2013 ― after a stint at Credit Suisse and Kiodex, an energy trading software company ― meant that he sat atop Goldman’s biggest division, accounting for about one-third of global headcount.

A big part of that job has been bringing down the amount the bank spends on maintaining old systems, which consume about one-third of Goldman’s annual $3bn tech budgets, according to estimates by Credit Suisse analysts.

He has also taken a page out of Google and Facebook’s playbook and started giving away some of the bank’s trading technology to clients via open-source software, inviting them to use it and improve it.

What sets Mr Chavez apart is “his ability to take decisive action based on what the world will look like in five to 10 years”, says Tom Farley, president of the New York Stock Exchange, who worked with him at Kiodex. “Other people may have a view of the future but they’re afraid to act on it.”

In an address to Goldman interns this summer, Mr Chavez told them that as a new graduate, he wanted to “get busy and do a bunch of things”. When he landed on Wall Street, he learnt that people called that attitude “optionality”.

“You don’t know that these options are going to be worth something, but if you do the work, pay the premium, own a whole bunch of these options on a lot of different outcomes and you’re diversified enough, probably something will work out,” he said.
Goldman_Sachs  Martin_Chavez  CFOs  appointments  Wall_Street  unconventional  SecDB  databases  generating_strategic_options  forward_looking  CIOs  Hispanics  optionality  new_graduates  legacy_tech  playbooks 
december 2016 by jerryking
Edith Cooper Goldman Sachs on talking about race at work - Business Insider
Edith Cooper, Goldman Sachs
Sep. 23, 2016,

Focusing on what you can control and taking mindful steps and positive action towards what matters to you
Goldman_Sachs  African-Americans  Harvard  HBS  women  beyond_one's_control  Wall_Street  human_resources  affirmations  span_of_control  Edith_Cooper 
december 2016 by jerryking
Algorithms Aren’t Biased, But the People Who Write Them May Be - WSJ
By JO CRAVEN MCGINTY
Oct. 14, 2016

A provocative new book called “Weapons of Math Destruction” has inspired some charged headlines. “Math Is Racist,” one asserts. “ Math Is Biased Against Women and the Poor,” declares another.

But author Cathy O’Neil’s message is more subtle: Math isn’t biased. People are biased.

Dr. O’Neil, who received her Ph.D in mathematics from Harvard, is a former Wall Street quant who quit after the housing crash, joined the Occupy Wall Street movement and now publishes the mathbabe blog.
algorithms  mathematics  biases  books  Cathy_O’Neil  Wall_Street  PhDs  quants  Occupy_Wall_Street  Harvard  value_judgements 
october 2016 by jerryking
At BlackRock, a Wall Street Rock Star’s $5 Trillion Comeback - The New York Times
SEPT. 15, 2016 | NYT | By LANDON THOMAS Jr.

(1) Laurence Fink: “If you think you know everything about our business, you are kidding yourself,” he said. “The biggest question we have to answer is: ‘Are we developing the right leaders?’” “Are you,” he asked, “prepared to be one of those leaders?”

(2) BlackRock was thriving because of its focus on low-risk, low-cost funds and the all-seeing wonders of Aladdin. BlackRock sees the future of finance as being rules-based, data-driven, systematic investment styles such as exchange-traded funds, which track a variety of stock and bond indexes or adhere to a set of financial rules. Fink believes that his algorithmic driven style will, over time, grow faster than the costlier “active investing” model in which individuals, not algorithms, make stock, bond and asset allocation decisions.

Most money management firms highlight their investment returns first, and risk controls second. BlackRock has taken a reverse approach: It believes that risk analysis, such as gauging how a security will trade if interest rates go up or down, improves investment results.

(3) BlackRock, along with central banks, sovereign wealth funds — have become the new arbiters of "flow.“ It is not about the flow of securities anymore, it is about the flow of information and indications of interest.”

(4) Asset Liability and Debt and Derivatives Investment Network (Aladdin), is BlackRock's big data-mining, risk-mitigation platform/framework. Aladdin is a network of code, trades, chat, algorithms and predictive models that on any given day can highlight vulnerabilities and opportunities connected to the trillions that BlackRock firm tracks — including the portion which belongs to outside firms that pay BlackRock a fee to have access to the platform. Aladdin stress-tests how securities will respond to certain situations (e.g. a sudden rise in interest rates or what happens in the event of a political surprise, like Donald J. Trump being elected president.)

In San Francisco, a team of equity analysts deploys data analysis to study the language that CEOs use during an earnings call. Unusually bearish this quarter, compared with last? If so, maybe the stock is a sell. “We have more information than anyone,” Mr. Fink said.
systematic_approaches  ETFs  Wall_Street  BlackRock  Laurence_Fink  asset_management  traders  complacency  future  finance  Aladdin  risk-management  financiers  financial_services  central_banks  money_management  information_flows  volatility  economic_downturn  liquidity  bonds  platforms  frameworks  stress-tests  monitoring  CEOs  succession  risk-analysis  leadership  order_management_system  sovereign_wealth_funds  market_intelligence  intentionality  data_mining  collective_intelligence  risk-mitigation  rules-based  risks  asset_values  scaling  scenario-planning  databases 
september 2016 by jerryking
Wall Street’s Insatiable Lust: Data, Data, Data
By BRADLEY HOPE
Updated Sept. 12, 2016

One of his best strategies is to attend the most seemingly mundane gatherings, such as the Association for Healthcare Resource & Materials Management conference in San Diego last year, and the National Industrial Transportation League event in New Orleans.

“I walk the floor, try to talk to companies and get a sense within an industry of who collects data that could provide a unique insight into that industry,” he said.....Data hunters scour the business world for companies that have data useful for predicting the stock prices of other companies. For instance, a company that processes transactions at stores could have market-moving information on how certain products or brands are selling or a company that provides software to hospitals could give insights into how specific medical devices are being used......A host of startups also are trying to make it easier for funds without high-powered data-science staffers to get the same insights. One, called Quandl Inc., based in Toronto, offers a platform that includes traditional market data alongside several “alternative” data....
alternative_data  conferences  data  data_hunting  hedge_funds  insights  investors  exhaust_data  market_moving  medical_devices  mundane  private_equity  Quandl  quants  sentiment_analysis  unconventional  unglamorous  Wall_Street 
september 2016 by jerryking
Understanding SecDB: Goldman Sachs’s Most Valued Trading Weapon - WSJ
By JUSTIN BAER
Sept. 7, 2016

traders use the system to track how a position would have performed over the past year, how it might do in the future under different scenarios, and how the holding might alter their broader portfolio. They can also use the system to help determine a price to charge the trade’s counterparty.

But traders aren’t SecDB’s only users. The firm’s risk managers use the system to peer into positions held by a trading desk or business to determine aggregate exposures.

Every Wall Street firm has tools to run each of those functions. But SecDB’s power comes from its universal use throughout the firm, its flexibility to add new variables or new sources of information, and its ability to tap into all of Goldman’s data.
Goldman_Sachs  traders  Wall_Street  databases  counterparties  information_sources  SecDB 
september 2016 by jerryking
Goldman Sachs Has Started Giving Away Its Most Valuable Software - WSJ
By JUSTIN BAER
Sept. 7, 2016

Securities DataBase, or SecDB, the system remains Goldman’s prime tool for measuring risk and analyzing the prices of securities, and it calculates 23 billion prices across 2.8 million positions daily. It has played a crucial role in many of the seminal moments of the firm’s recent history, including its controversial trading just ahead of the financial crisis.....There is perhaps no better sign of the changes that have engulfed Wall Street than this: Goldman has recently started giving clients the tools that made it a trading powerhouse, for free.

The firm’s motives aren’t altruistic; rather, many of the edges that once made Goldman’s traders feared and admired have been blunted. New rules have limited banks’ trading risks, and made it costly to hold large inventories of stocks and bonds on their books. And electronic trading has squeezed margins, dimming the clamor of trading floors across Wall Street....Traders and executives tap into SecDB to inform how to price securities, and how the value of those assets may change with a twist on the dial on any one of thousands of potential variables. That information can be used to analyze potential trades—and then to monitor the risks posed by those positions.

What made it the envy of Wall Street, though, was its ability to scale up to include new classes of securities, new trading desks, even whole businesses. And the data it harnessed was all in one place.
Wall_Street  Goldman_Sachs  tools  traders  risk-management  informational_advantages  software  free  databases  platforms  CIOs  proprietary  slight_edge  Aladdin  Martin_Chavez  scaling  SecDB  seminal_moments  asset_values  scenario-planning  stress-tests 
september 2016 by jerryking
The Disrupters: Making New York’s Cultural Boards More Diverse
JULY 30, 2016 | The New York Times| By JACOB BERNSTEIN.

But Dr. Muhammad, the former director of the Schomburg center, cautioned against seeing Mr. Smith’s entry into New York cultural life as a sign that things will change in a meaningful way.

“White people are going to be wealthier on average, wealthier people are going to be in leadership positions more often, and in those positions they’re likely to be part of a network of people in the same social milieu,” Dr. Muhammad said. “There’ll continue to be people like Robert Smith, who happen to be African-American and do wonderful things, but there’s a giant wealth gap between blacks and whites, and it’s only widened in the wake of the great recession. Is this a sign of a trend that black people will be the heads of boards all over the country? I doubt it.”
Darren_Walker  glass_ceilings  African-Americans  high_net_worth  cultural_institutions  boards_&_directors_&_governance  diversity  New_York_City  museums  lawyers  investment_banking  Wall_Street  Harvard  Robert_Smith  racial_disparities 
august 2016 by jerryking
Steven A. Cohen’s Newest Bet: Do-It-Yourself Computer Traders - WSJ
By BRADLEY HOPE
July 27, 2016

Steven A. Cohen is betting as much as as $250 million that mechanical engineers and nuclear scientists can come up with market-beating mathematical models in their spare time. He's investing in a hedge fund launched by Boston investment firm Quantopian that provides money to do-it-yourself traders who come up with the best computerized investing methods, giving a share of any profits to the creators.

Mr. Cohen, chief executive officer of Point72 Asset Management LP, is also making an undisclosed investment in Quantopian itself through his family-office venture arm Point72 Ventures.

The billionaire’s new commitments are part of a broader push in the money- management world to embrace quantitative investing, which relies mainly on math-based models to bet on statistical relationships or patterns in stocks, bonds options, futures or currencies......Point72 Asset Management oversees the personal wealth of Mr. Cohen, his family and employees. It already has an internal team devoted to computer-driven trading strategies......Quantopian says it has 85,000 users signed up from 180 countries who have created more than 400,000 algorithms on the company’s free web-based platform. So far, the firm has only selected 10 of those to trade a few hundred thousand dollars on behalf of Quantopian. The platform is only for U.S. equities trading so far, but Quantopian plans to expand to other asset classes.
algorithms  quantitative  Wall_Street  Steven_Cohen  beat_the_market  hedge_funds  DIY  SAC_Capital  money_management  investing  Point72  asset_classes  family_office 
july 2016 by jerryking
Financial PR spins a new global story — FT.com
MAY 6, 2016 by: By Shannon Bond and James Fontanella-Khan in New York and Arash Massoudi in London

Leading financial communications companies from New York to Hong Kong are responding to growing demand for “whisperers” with global, political and digital nous. Nowadays, PR firms are expected to craft a corporate narrative that works across different markets, to handle complex relations with governments whose interests often diverge and to provide rapid-response crisis management.
crisis_management  Wall_Street  London  Communicating_&_Connecting  boutiques  public_relations  government_relations  consolidation  financial_communications  rapid-response 
may 2016 by jerryking
From Wall Street Banking, a New Wave of Fintech Investors - The New York Times
By LIZ MOYERAPRIL 6, 2016
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investors  angels  fin-tech  Wall_Street  financiers 
april 2016 by jerryking
Goldman’s Tech Chief Pushes the Bank to Be More Open, Like Him - The New York Times
APRIL 1, 2016 | NYT | By NATHANIEL POPPER.

Today Goldman is trying to change not only that public image, but also some of the central tenets of its culture, like the secrecy and reliance on back-room dealings. The firm’s chief executive, Lloyd C. Blankfein, has said he wants Goldman to be thought of as a tech company — putting it in direct competition for talent with the Googles and Facebooks of the world. No one is more central to these efforts than Mr. Chavez.

Mr. Chavez, who was promoted just over two years ago to oversee the firm’s 9,000 or so computer engineers — nearly a third of the staff — is pushing the 147-year-old firm to, among other things, share more of its data and software with clients. His centerpiece project, Marquee, gives clients access to sophisticated trading data previously available only by phoning a Goldman employee.....Mr. Chavez represents broad pressures across the financial industry. The 2008 economic crisis and the regulations that followed it are forcing banks to become less opaque and more technologically savvy and efficient. This has shifted the center of power in the business away from the trading desks, where it was before the crisis, and toward the programmers and engineers — until recently dismissed as the geeks in the back office....Mr. Chavez says that if efforts like his are successful, clients will see “a very different configuration of the financial services industry than the one we have now.” Goldman will still have the chief product of a bank — money to lend and invest — but he thinks that the ways in which customers get access to that money will rely more on software and less on the bankers who traditionally delivered Goldman’s services.
CIOs  Wall_Street  Goldman_Sachs  Hispanics  transparency  financial_services  Martin_Chavez  war_for_talent  digital_savvy 
april 2016 by jerryking
Hedge Funds’ Idea Man - WSJ
By JULIET CHUNG
Jan. 4, 2016

The 54-year-old Brazilian immigrant is part of a larger ecosystem of consultants who sell their investment beliefs to hedge funds. The funds, hungry for returns or cheap hedges for their portfolios, get fresh ideas that comprise or inform their wagers. The consultants, in exchange, often expect to share in gains tied to their ideas, they and their clients said.....The ideas don’t always result in profits. ...Such arrangements make some veteran investors in hedge funds uneasy.

“If your manager’s renting a lot of ideas, you have to question the value-add they bring to the partnership,” said Chuck Bryceland of New York-based Bessemer Trust, which advises wealthy families and individuals on investments, including in hedge funds. “We want our people generating primary trade ideas and doing the primary work themselves.”
investment_advice  investment_research  ideas  Wall_Street  money_management  private_banking  hedge_funds  shareholder_activism  traders  exclusivity  idea_generation  value_added  financial_advisors  high_net_worth  Bessemer  Bessemer_Trust 
january 2016 by jerryking
BlackRock’s Chief, Laurence Fink, Urges Other C.E.O.s to Stop Being So Nice to Investors - NYTimes.com
APRIL 13, 2015
Continue reading the main storyVideo

PLAY VIDEO|3:24
BlackRock Chief on ‘Gambling Society’
BlackRock Chief on ‘Gambling Society’
Laurence D. Fink, chief executive of the largest asset manager in the world, warns that too many C.E.O.’s have been trying to return money to investors through dividends and buying back stock By CNBC on Publish Date April 14, 2015. Photo by Mark Lennihan/Associated Press.

Andrew Ross Sorkin
Laurence_Fink  CEOs  asset_management  Andrew_Sorkin  institutional_investors  Wall_Street  shareholder_activism  long-term  BlackRock 
april 2015 by jerryking
Why a Harvard Professor Has Mixed Feelings When Students Take Jobs in Finance
Walker New York 2 hours ago APRIL 10, 2015
Professor Mullainathan's article illustrates perfectly why the study and profession of economics has been dubbed the "dismal science." He draws upon highbro...
letters_to_the_editor  finance  Harvard  Wall_Street 
april 2015 by jerryking
Why a Harvard Professor Has Mixed Feelings When Students Take Jobs in Finance - NYTimes.com
APRIL 10, 2015 | NYT | By SENDHIL MULLAINATHAN.

Every profession produces both private returns — the fruits of labor that a person enjoys — and social returns — those that society enjoys. If I set up a shop on Etsy selling photographs, my private returns may be defined as the revenue I generate. The social returns are the pleasure that my photographs provide to my customers....
career_paths  career  Wall_Street  students  economics  Harvard  Colleges_&_Universities  talent  rent-seeking  arbitrage  finance 
april 2015 by jerryking
Hedge-Fund Magnate Robert Mercer Emerges as a Generous Backer of Cruz - NYTimes.com
APRIL 10, 2015 | NYT| By ERIC LICHTBLAU and ALEXANDRA STEVENSON.

Mr. Mercer, a reclusive Long Islander who started at I.B.M. and made his fortune using computer patterns to outsmart the stock market, emerged this week as a key early bankroller of Mr. Cruz’s surprisingly fast campaign start.

...Mr. Mercer does not have the name recognition of fellow Republican financiers like the Koch brothers or Sheldon Adelson, but he has spent more than $15 million since 2012 in support of conservative political campaigns and causes, donating to a number of candidates who had never even met him. ....Robert Mercer is discussed in “More Money Than God,” a book about the hedge fund industry by Sebastian Mallaby....Before joining Renaissance Technologies, Mr. Mercer, 68, worked at I.B.M.’s research center, where he specialized in computerized translation of languages.....When James H. Simons, the billionaire founder of the Renaissance hedge fund, hired Mr. Mercer in 1993, the company was more university campus than Wall Street firm. Mr. Simons, a mathematician and former code-breaker for the National Security Agency, brought in astronomers and physicists to analyze reams of data, using computer programs to search for patterns that could be used to inform trading decisions. Mr. Simons has been a major political backer of Democrats, donating $8.3 million in 2014.
hedge_funds  moguls  high_net_worth  Robert_Mercer  Wall_Street  Ted_Cruz  Renaissance_Technologies  books  Citizens_United  James_Simons  PACs 
april 2015 by jerryking
Google Should Feel Lucky in Its Finance Chief Hire - NYTimes.com
MARCH 24, 2015 | NYT | Robert Cyran is a columnist for Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.

Google should feel lucky about its search for a new chief financial officer.

There’s a dearth of executives with the financial, technology and government know-how needed to help run a $400 billion company. Even fewer women fit the bill. Silicon Valley and Wall Street just can’t find people like Morgan Stanley’s chief financial officer, Ruth Porat, fast enough. The challenge is to create more like her.

Ms. Porat grew up in Palo Alto, Calif., and graduated from Stanford before embarking on an almost three-decade career in investment banking.
CFOs  Google  Silicon_Valley  Wall_Street  women  Stanford  alumni  Andrew_Sorkin 
march 2015 by jerryking
On the Case at Mount Sinai, It’s Dr. Data - NYTimes.com
MARCH 7, 2015 | NYT |By STEVE LOHR.

“Data-ism: The Revolution Transforming Decision Making, Consumer Behavior, and Almost Everything Else,” by Steve Lohr,
Steve_Lohr  data  data_driven  data_scientists  Wall_Street  Facebook  hospitals  medical  books  Cloudera  consumer_behavior 
march 2015 by jerryking
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