A friend in finance pointed out to me today that there are probably “more than 100,000” newly-unemployed bankers (including investment banks, hedge funds, private equity) in New York City right now, trying to figure out what comes next.
This is bad news for NY-based nonprofits, who are feeling the double-whammy of Wall St. donations drying up and the Bernie Madoff madness (plus huge cuts in local and state spending). And I suspect that 2009 will be the year where we learn how bad things really are, not the year when we’re pleasantly surprised that things aren’t as bad as we thought they were.
Nevertheless, I for one pray it is the end of an era, and not just a pause between acts. Not because of the greed (which has always been there and always will be); and not just because of the excess-piled-on-excess that had become the norm for pay on Wall Street (though it stinks).
The gravitational pull of Wall Street has gotten so strong that it pulled in many of our best mathematicians, lawyers, engineers, you name it. It’s an imbalance that has pulled talent away from other sectors, and one that I hope gets restored.
So what’s the upside look like? I wonder what those 100,000+ bankers – some of the smartest, most ambitious, out-of-work Type A personalities around – are going to end up doing.
Is it possible that there will be (slowly, quietly) a huge influx of talent into the government and our healthcare system and the education system and the social sector?
Wouldn’t that be great?
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And if you haven’t seen it, you must read Michael Lewis’ essay “The End” from Portfolio.com. Michael gives the inside story that explains what all this subprime / CDO / securitization really means — how it happened, how truly ugly it was, and how everyone looked the other way because so many people were getting so rich.
What happened on Wall Street at the end of 2008 was the music stopping after 25 years of buildup. If you want to understand how and why, take the 20 minutes to read Lewis’ article. It’s fabulous.