Question for everyone grinding it out. Do you think that Goldman guys will still be the public servants in the next decade, or will they now be replaced by folks from there banks. In the last two administrations you saw guys from GS working at the treasury and NYFed. Are they now tainted and if so, will they be replaced by another bank? And if so which one?
Sort of a random thread, but I would like to have a light at the end of the tunnel.
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government and the fed guys seem to have a hard on for small regional banks, mccain kept talking about them at the goldman hearding, i suspect commercial bankers at the bank of bumblefuck will take over fed soon
IMHO, having some geographical diversity at the Fed is all right- maybe even healthy. The key here is that there are a lot of smart people outside NYC and Washington, and if we already have one guy at the fed who's right 90% of the time, it's probably better to choose someone who's right 85% of the time- but 5% of the time is right when the other guy is wrong- than get another guy who thinks exactly the same way.
Voters hate elitism, and many of them would argue that the NYC got us into the mess we got into back in 2008 in the first place. Us New Yorkers might be awfully smart folks, but if a bunch of politicians from the West and the middle of the country can convince voters that we're too stupid to run the fed, maybe the pols are a lot smarter than we give them credit for, and maybe they should be choosing the bankers running the country, rather than us calling ourselves the "best" and saying they should choose us to set the nation's monetary policy if they have half a brain.
The main reason GS guys went to gov't was because they wanted to - I'm sure they'd still like to, but I don't think Lloyd et al. necessarily have that opportunity any more. For instance, Felix Rohatyn (Lazard) always wanted to be Treasury Secretary, and was undoubtedly qualified, but backing the wrong horse in the '92 election meant he was made Ambassador to France instead. It's an interesting question - community bankers certainly won't be coming in; Congress has had a hard-on for them since the 19th century, but they've yet to be stupid enough to act on it. Does that mean bankers from BAC, MS, C, etc will be coming in? Or will the flow of talent from pvt -> gov't be over? I don't know, but in the long run, if the gov't refuses to hire investment bankers anymore, that's bad for everyone, not just the guys at Goldman.
I could not imagine that bankers will become unwelcome in public service entirely, I wonder if some other franchise like Morgan Stanley or JPMorgan Chase will step into this role. Back in the day when Brown Brothers Harriman was a powerhouse they fed a lot of folks to Treasury and Chase did as well back when Rockefeller was head. There has always been a link between the Street and the Government. Hamilton after all did found Bank of America before he had a hand in the modern government financial system. I simply cant imagine that this link will be broken. I would guess that some other bank will become a feeder.
Who do you think is best positioned for this sort of thing? Could you see Jamie Diamond taking over as Treasury Secretary for a future administration? Maybe you are right and the boutique banks could have a shot.
I'm pretty sure you mean Alexander Hamilton, who founded the Bank of the United States, which was a government entity. Bank of America began in 1904 in San Francisco, and was certainly not founded by Alexander Hamilton.
Yea Bank of America is founded by an Italian immigrant who founded Bank of Italy in SF before the great quake.
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