Wednesday, February 04, 2009

How Terrible Wouldn't That Be?

Oppenheimer analyst Meredith Whitney defends the extremely high pay levels on Wall Street by saying:

"The failure to pay employees well may drive away “the best and the brightest. If you can’t compensate your employees, they’re going to go somewhere else You’re going to get a different variety of folks who are going to come in."

Two obvious questions:
Just where are these "best and brightest" people supposed to go? Are there any companies out there eager to hire people who have just wrecked their companies?

And what's the worst thing that could happen if "a different variety of folks" came in? Could this result in financial companies not making hundreds of billions of dollars of losses?


Blogger fboness said...

In many ways Wall Street has seduced the best and brightest who we really could use elsewhere. The Phd mathematicians and physicists drawn to Wall Street to make economic models might find better use for their talents developing an improved power grid or fusion or...

5:45 PM  
Blogger VV111y said...

It's funny how stating the obvious can sometimes seem so shocking.

Of all people, I'm surprised she would say something like that.

6:52 PM  
Anonymous Anonymous said...

This is wonderful, mainly because it is not what I expected! Besides your wonderful quips about the best and brightest bankrupting the system, it implies an understanding that these salaries are not free market based salaries but reflect political privilege, commonly called corporatism.

7:52 PM  
Anonymous Bruce Codding said...

The culture on Wall Street is still one of privilege and entitlement.

You are right "a different variety of folks", beginning at the top, is what is needed for meaningful change.

12:07 AM  
Anonymous Kevin said...

Bravo Stefan BRAVO!!! The absurdity of her comment is apropos for the times. People operating in an oblivious state, blissfully unaware of the carnage going on around them, assuming that the way it has always been is the way it always should be.

2:34 AM  
Anonymous Anonymous said...

The balance of power should be restored in favour of the regulators so maybe the best and brightest can do some good work there. All the brilliant quants could devise a system structure and rules that do keep the system in check.

8:24 AM  

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