Wall Street Meltdown: The best thing that could happen to bankers

Wall Street Crisis
Image by MyEyeSees via Flickr

Roger Ehrenberg, ex-banker turned startup investor, wrote a good post a while back discussing the possibility that the collapse of wall street will fan the entrepreneurial flames of ex-wall streeters.  I’ve been talking about this since the beginning of the financial crisis and I have an answer: YES.  I believe that the financial crisis will lead to positive changes in the lives of many Americans.

As an ex-banker (well, sort of, equity research) turned sailor turned startup grunt turned rock band bassist turned student of startups, I believe that unleashing a herd of hardworking and (relatively) intelligent people will lead to more than a few entrepreneurial success stories.  If nothing else, a forced break from the fire-hose of “absolutely critical” business and career will help people to understand that there is more to life than climbing the corporate ladder.  Shouldn’t it worry you that spending a sunny weekday on sheep’s meadow nearly drives you crazy?  Thoughts on what I call “the river” and “PDA dependency” to come on later posts.

When The Street began to fall apart, I dreamed up a new project: collecting a set of stories about Ex-Wall Streeters who, freed from jobs that they hated, go on to pursue their passions and, most likely, much happier lives. What do you think? I’m not saying that every banker is self-loathing (most of the truly successful ones aren’t), but a lot are.   Sadly, people stay in jobs that they hate because their “opportunity cost” is too high to leave. They’d rather pay the price of lifelong self-resentment than pursue fulfillment in, gasp, a potentially less lucrative field.

Why do people who manage risk for their living make such “irrational” decisions you may ask? Their myopia is the result of spending 7 days a week, 51 weeks a year (save a week long “recharge” in an otherwise unused cottage in the Hamptons) in a culture that has but one yardstick, the dollar. The simplicity of a system where every decision can be measured with one simple metric- how much $$$ am I making? – is both distorting and intoxicating.

To bring it home, I  believe that Roger’s third factor, risk, will have the most affect on the ex-Wall Streeters. Wall Street was never risky to its participants. It’s probably one of the safest career choices (on an expected value basis) available. No longer be able to tell exhilarating stories about the exorbitant sums they made with Other People’s Money, these people will have to completely re-conceive their personal notion of risk and how it interfaces with their self-image. Drawing spreadsheets for a modest living is a bit harder to sell as exciting and risk taking, even to oneself. Accountants, where you at?

I think, and sincerely hope, that the implosion of “gravy train” will liberate talented ex-Wall Streeters from their myopic fear and enable them to follow their dreams. Value expansion, if only in the personal sense, seems inevitable.

If anyone wants to tell their story or has a  friend that wants rap about their new plans, I’d love to talk to you.   Thanks and good luck.

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3 responses to “Wall Street Meltdown: The best thing that could happen to bankers

  1. Kudos for touching on the possible, dare I say it, positive outcomes from the financial crisis. It is a refreshing rhetoric leaning away from the quick fixes of socialization that have emerged from an outlook of doom and gloom.

    In addition to the renewed invigoration of an entrepreneurial spirit and true personal passions I would like to comment on one benefit financial turmoil has afforded me: perspective.

    At first glance recent graduates, such as myself, appear at a disadvantage to our predecessors who left college with a plethora of job options. During the Clinton years entry level salaries were quite high. Newbies learned to love the green and ran with it.

    Warm and fuzzies associated from the purchases of fancy cars, nice homes, and bling tend to wear off once reality hits. The realities, to name a few, came in the form of high gas prices, mortgage meltdown, and DIVORCE….of course she left your ass, you were always working!

    We measly recent graduates who have to taste a bit of what its like to work hard, be poor, and get creative in order to achieve our goals should count ourselves lucky. My alternative route brought me to Brussels where I am picking up some French and teaching English to children. If I had rushed straight into the career world I probably would have missed out on this experience. Golden opportunity time: the world is giving us the perfect excuse to stay young, enjoy our youth, slow down. Sounds good to me. Put on your favorite sould record and do what feels right.

    I feel blessed that I was not handed a shiny job straight out of college. Now I can properly plan for the future with some real world perspective. Not to mention the fine tuning of my mad karaoke skills. Here’s to the good life!

    • Hi Holly,

      Thanks for your thoughts. I’m glad that you are able to appreciate the myriad of opportunities open to you that you might have otherwise overlooked. Safe travels and if you happen to try the half pipe in Christiana-be careful!


  2. Couldn’t agree with you more. Sad that it takes your house burning down to get you to venture outside, but… ah, well.

    I wholeheartedly encourage a sort of “WHAT NOW?!?!?”-wiki for former fincance-types (and hopefully future entrepeneurs) who’ve had a lot of conscious and subconscious experience with how markets and businesses work to think both big-picture and small-picture (“the forest AND the trees” to extend the frightening-wilderness metaphor) about what lies ahead and how we can find and harness some opportunity here.

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