Why are young bankers so miserable?
Young, optimistic students come out with their prestigious educations hoping to make the world better. But why are they so miserable and pessimistic once they get a break on Wall Street?
From The Atlantic:
"I lie whenever I go out now,” he told me. “I tell people I’m a consultant, a lawyer, whatever—anything but a Wall Street guy."
“You’re working with this constant fear,” he said. “You go to this bulletproof firm, it gives you a ton of options, and it’s really self-validating. And then all of the sudden, you have no options, you’re not getting paid nearly as much as you thought, and you might get fired. And then you START thinking, Well, shit, I could be halfway through law school, and instead I’m in New York dicking around doing models and bottles, and at the end of it I won’t even have that much to show for it.”
Any success stories on Wall Street? How you coped with the hours, mundanity, and overall purpose?
Correct me if I'm wrong - law is a totally saturated market and most law school graduates do not land coveted associate roles at firms that justify spending more time at school. I'd consider spending my time at most law schools to be "dicking around"
One person who's a corporate finance lawyer told me it depends where you go - coming from a place like Yale law school etc you will have good opportunities if you are a fairly normal person and had good grades... But that was just one person that told me that
Yeah look up lawyer salary distributions, You will probably be shocked.
Who went to a BB thinking they were making the world better? If anyone actually thinks that....they're retarded. Also, comp is pretty standard at the junior level so I have no idea what these guys were expecting. They sound soft as fuck.
If you're going into M&A with the intention of making the world better, then you're mentally deficient.
Despite the hours and trivial work, there are some people who genuinely enjoy what they do. These are the people who went into the field for the right reasons. Unfortunately, this is the minority.
The majority do not enter the field for the right reasons. They end up being genuinely miserable for 2-3 years, whilst chasing some elusive distant opportunity that might eventually make them happy.
I agree that these people should know what they're getting into.
I visit this forum a lot and people always seem to be in search of a "noble" career. I think this is causing a lot of unhappiness in the workplace for many recent grads. Most people should get used to the idea that they won't be working "to make the world a better place" in any profession that they enter. The idea that these careers really exist in any meaningful way is a myth. Many jobs that actually improve society pay next to nothing. I don't see many young people beating down the door to become the next director of the parks and recreation department.
This leads me to my next point- I disagree that working at a BB is somehow "bad" for society. Is advising organizations through a complex financial system really that bad? Is having a functional capital markets where companies can issue debt/equity, or buy, sell and merge with other companies somehow the root of all evil now?
I know there are some people doing some shady things. I'm not trying to sugar coat anything here. But one of the students quoted in the article mentions law school- is that how low the bar is now? For every lawyer "doing something good", there are 100 lawyers lobbying congress for some esoteric piece of legislation that is better for his client than the citizens that a congressman supposedly represents. There's another 100 that actually work for a BB. There's another 100 chasing ambulances.
Tech is usually mentioned in the context of maligning careers in finance. You've heard it before- Wall Street is "losing out" to tech jobs. If you're at HBS and end up in banking, people feel sorry for you.
Give me a break. I could spend hours going through all the unseemly things tech companies do (offshoring to China, massive data collection, etc.), but I don't have a problem with tech companies. I have a problem with people who think developing a dating app is "revolutionizing" the world. I mean let's be honest here- engineers actually create technological innovation. If you're not an engineer, you're just monetizing their creation. This is no different than selling soap for P&G or bonds for General Electric.
Again, Nothing wrong with making a career in tech... Or law... Or banking, but let's get rid of the pretense that there is some nobility in any of it.
It's not working for a BB bank that makes your profession inherently bad for society. A BB bank is just a corporation that has been loosely defined as being 'bulge bracket'. Banks are significant and vital contributors to society. Most of the professions within banks are absolutely necessary for an advanced society to function effectively and efficiently. Rather, It's the profession itself (M&A) that is bad - regardless of whether you work at a BB bank, EB, MM, ect.
There are plenty of professions within a bank that add value to society. In fact, the majority of them do. However, it is one of the most well-established facts within finance that the majority of M&A has negative economic value - it destroys value for society. People in M&A can cry about this all they like but that will not change reality. This is one of the most well-researched phenomena within finance.
We can debate why this economic inefficiency still persists (behavioural factors, ect) and whether it will continue to exist in the future. Hopefully, in the future, company management will stop undertaking overwhelmingly value-destructive M&A deals. M&A markets will contract and become more efficient, leading to M&A becoming a positive contributor to the economy. But until then...
*Also, keep in mind that I'm not saying that ALL M&A is value-destroying. M&A is a vital profession for the functioning of the economy. With that said, the majority of M&A is value-destroying, which puts the entire profession into the category of "negative" in terms of contribution to society.
M&A advisors are market makers, just like equity traders, FI traders, etc. Their market just happens to be significantly less liquid and deals in much less volume. As such, it ends up getting lost in the shuffle that at the end of the day, M&A professionals aren't the ones making the deals, they just make the market. There are countless numbers of failed integrations and potentially lost shareholder value, but that's not on the advisors, that's on management.
There are numerous ways that M&A adds intangible value: allowing founders to monetize their creation, helping scale great products, ridding of inefficiencies in companies, etc. Just because a study found that a quantitative measure for shareholder value implied that M&A destroys value does not mean that M&A is "bad." If there weren't professionals that created a streamlined process for exiting your business, buying a business, etc., we would lose a very large alternative asset class (PE), entrepreneurs would be less incentivized to innovate and grow their businesses, and our economy would function at a considerably lower level.
This is one of the most short-sighted posts I've every read on this forum, maybe skip the Bernie rally and actually think before your next post.
Soft and bad at their jobs
Any particular reason you're posting these articles? This is the second thread today you've posted with the same premise. If it's genuine curiosity, you could just compile all your questions about banking into one thread and some of us would be happy to answer them.
Because they lack real-world perspective and gratitude which can only be gained through experience and time.
What many people fail to realize is that college students who are prospective bankers are not much different than those kids who don't know what they want to do in college and decide to go into psychology their junior year because it's "interesting". The only difference is that the former were convinced by family or friends to go into banking or were influenced by the media and pop culture depicting Wall Street as a place where money grows on trees, whereas the latter didn't have that same direction. Regardless, most prospective bankers are just as naive as those psychology majors.
So many people get into banking thinking that a FT BB position is the golden ticket to riches by transferring into PE or VC, trading at a hedge fund, or becoming a senior banker. The reality is that few people, maybe 20% (or less) that enter the industry as junior bankers, actually "make it" in finance. And in order to even have a chance of taking that next step, you have to do soul-crushing work that is awful for your health. On top of that, you have to sacrifice a significant portion of your social life, have little contact with friends and family. One may argue that the pay compensates for all of this, but the truth is, you're lower middle class living in NYC making ~120k a year.
I'm not saying that IB is a bad choice. Doing 2 years in IB post undergrad is arguably the best way to advance your career forward. There are excellent exit opps that pay well, provide you with more interesting work, and don't require insane hours. People just need to temper their expectations about what IB will bring them.
Unfortunately, I don't think the status quo will change anytime soon, unless something happens that suddenly makes banking unattractive. Recruiters will continue to sell fake dreams, prestige whoring will still run rampant, college kids will still be naive, and students will continue to be influenced by peer pressure and the desire to do something that's "cool".
But Bobby Axelrod didn't even go into banking.
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