The wail of the 1% | Hacker News Reader

The wail of the 1%

nymag.com

19 pointsquoderat6 comments

“People go to Wall Street out of greed. When I was interviewing for jobs, frequently some form of the question came up: How much do you want to make money? If my answer was something like—and it wasn’t—but if my answer was, ‘I’m here for intellectual betterment,’ their response might have been, ‘University is a great place for you.’ They want people who think ‘I’m greedy, I want to be a billionaire.’ That was viewed as a really good thing.”

I think this quote symbolizes what's wrong with Wall street. There's too much of a focus on making money by any means necessary rather than doing what's best for your employer and clients in the long term. No matter how your incentives work, there's simply no way to have an incentive-based compensation system that can't be gamed.

"I was at my doctor the other day, and my doctor said to me, ‘You know, I like that when I leave the office, I leave.’ I get calls at two in the morning, when the market moves. That costs money. If they keep compensation capped, I don’t know how the deals get done. They’re taking Wall Street and throwing it in the East River.”

Maybe that's the problem. Maybe if people weren't compensated so disproportionately, and if there wasn't so much pressure for short term profits, they'd concentrate on doing deals that were more in line with economic fundamentals rather than instinct.

The issue with Wall Street overcompensation has more to do with what has happened to nearly every other profession in the past 3 decades: utter fucking meltdown. Academia: the job market for PhDs is so terrible as to constitute a glaring and likely mortal embarrassment to the profession. Law: big-firm ("biglaw") attorneys now face a single-digit percent chance of making partnership, but are still expected to work hours that would be reasonable only if eventual partnership were guaranteed. Medicine: doctors' standards of living are being continually eroded by the scumbag bureaucrats who staff the health insurance companies. Manufacturing: in the Midwest, the recession began in 1980 and hasn't stopped yet. Infrastructure: falling apart due to low investment. At the same time, housing costs, medical bills, and tuitions have skyrocketed while commodities like food and gas have been more expensive. Enough numerical gymnastics are employed to make inflation appear low (and, thus, real GDP growth seem high) but if the numbers were accurately reflected, inflation would be closer to 5-7% and real GDP growth would be flat or slightly negative; the entire 2000s decade would appear to be a recession, which is what it has been for most Americans. What changed in 2008, for most Americans, is that the rich fell down too, and quite visibly; thus, people became less embarrassed to talk about it. It's no longer an admission of personal failure to talk about how bad things are.

The result is an economy that shows a lack of pluralism: finance dominates, all other professions suffer. Most Americans don't understand the complexities of the situation and liken Wall Street to a cancer responsible for the atrophy of the real economy.

I don't want to see finance get destroyed, but a return to a pluralistic economy where people assume roles appropriate to their abilities and behaviors. The perverse irony here is that capital markets are supposed to efficiently allocate resources, yet the era of the market-state has utterly misallocated the nation's talent, strangling academia while directing a disproportionate share of talented people to finance, one of the industries in which they're least useful.

The last time I heard doctors and lawyers were pretty well off, the roads seem quite good, the trains still operate, there is still bus services, telly still gives news and my lecturer still lectures while doing research also. Until recently plenty of jobs were out there and people were really quite well off so well off in fact that they were willing to spend billions in a pointless war and still continue to spend billion in some other war. And dude if you do not think that in the past 10 years we have had a lot of growth then I do not quite see how you explain the bust?

Sure, I get it. To become a rich lawyer, yano in the 7 figures level you have to work real hard and be well smart and have loads of connections, same for doctors, same for academia, intelligence is not everything you know nor does everyone posses the qualities to go up to the cream of the cream. So you see it as the fault of government I personally would like to narrow the fault of government to failing to keep an eye on the bank, as for the lawyers they really are able to look after themselves, after all the president is a former one. If you think finances are dominant then well yeah that's true but if you think that is to the detriment of other fields I think you are a bit wrong. There is no lack of eminent research being conducted, nor any lack of entrepreneurs being made out of such research. There is no lack of doctors, lawyers, academia. Is there a lack of positions? I do not know, these people are sort of self employed, the academia, well the phd researchers get grants, the barristers here are self employed, the solicitors have plenty of positions and so do the doctors, so really I know it is fun to take it all out of proportion and picture a country in doom and gloom, but really we are all humans, as are the bankers, they experimented with something, they failed, that's how life works, if you fail to experiment, you failed again. Hopefully they learned their lesson. No one got hurt and that is because your country is a rich country and was able to recuperate the bankers losses. Lessons were learned and we move forward, perhaps that is what some people would call progress. Next year we good again and the news will be dominated by who knows, war, climate change, terrorist, bullshit in other words just so as to make people like you see this world and this country as doomed and full of gloom. Nothing personal btw. :)

The comment you responded to was actually quite accurate in it's description of what's been happening in the United States for quite some time. Each industry has taken it's turn at the chopping block and been hollowed out to a shell of it's former self, with the exception of a few "safe" industries -- until now.

The "safe" industries have appeared so due to their proximity to "The Bezzle". Go look that up. Finance, Health Care, Law, Defense, Government; I think those are the major ones. The point being that the outsized flows of capital through these industries has been a direct result of a feedback loop between government-induced market distortion and kickbacks. The large percentage of revenue in these industries which is rarely paid out of pocket (insurance, defense budget, malpractice settlements, etc.) has acted as the veil behind which a culture of flagrant embezzlement and bribery has been easily concealed. Now that the tap is running dry and the wheels are coming off of the lie we've been told for 20 years, us hoi polloi are perceiving The Bezzle for what it really is.

No one got hurt and that is because your country is a rich country and was able to recuperate the bankers losses.

We shall see.

Is this anything other than the utter tripe that the first paragraph would suggest?

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