Is finance the right path for you?

As for the argument that consulting provides an extraordinary skill set with which one can eventually change the world, I just don’t buy it,” he said. “Everyone knows what the skill set is for most entry-level consultants: PowerPoint and Excel.”


the attached article discusses the “unusually high” percentage (~25%) of yale graduates end up pursuing finance and consulting coming out of college. the author of the article argues that these sectors are not “producing” or “creating” value and that these consulting and finance firms are so damn good at making recruiting as personalized and convenient as possible, as to derail future “Shakespeares” from their actual dream for a 2-3 year stint in the corporate cube.

not sure how 25% compares to historic Yale rates, but for NYU Stern the rate is closer to 90%  (granted, the following caveats 1. this specialized technical vocational school is a mold created specifically to transform individuals into bankers, and 2. the incoming student body is self-selecting–deep down, they know that  they want to change the world one committed loan or IPO at a time).

what is particularly shocking is that prior to actually working full time at a bank, so many people kill themselves trying to get in.  unless they have a history of receiving hours of unreasonable abuse and enjoy it, they most likely have no idea what to expect at work and are only in it for the external motivators of money and prestige (the several-round interview process intends to focus on separating those people willing to “kill themselves” or, in HR-speak, are “hungry”–whether or not the applicant knows how deep the abyss is before he/she actually takes the leap. how accurate and precise the interview process is another story completely).

though i have long noticed the detrimental effects of the lure of finance among some of my NYU friends and acquintances (signs usually include 1. attending all networking events, even the ones held by tier five investment shops such as “Nigerian Prince Investments, PLC”; 2. holding conversations void of any substance except for last year’s salary and bonus data; and 3. excessive masturbation to piles of cash, aka engaging in “money shots” as the colloquial term was known), i was still attracted by the money and the thought of working with the smartest and most ambitious people.  but of course i didn’t have a strong history of unreasonable abuse. i was a poser, a lamb in wolf’s clothing.

from a macro standpoint, finance is the direct application of economics.  it is the grease that allows capital flexibility among corporations and businesses. it is a constant innovator in developing new financial instruments that can lower costs for businesses to capitalize themselves (swaps, derivatives). it is the market place that best allocates resources among household savings and corporations wishing to borrow money. in the increasingly internationally capitalistic society, finance is essential.

however, due to the immense money flowing into the sector since the 1980’s debt “boom” (which should consequently be followed by a painful deleveraging process that will proceed to rob the current economy of any growth), banks have expanded its presence in the economy, thereby requiring higher demand for labor. thus began wall street standardized recruiting processes and the advent of specialized vocational schools aimed to feed talent to these growing banks.  as expendable as a pawn in the trenches of war, a financial analyst does all the work that requires more than one second of effort from any employee of higher seniority.

as a result, the distance between the analyst’s contribution and the end product–the value-add to society–increases drastically. without the gratification of seeing an eventual impact, the only motivating factor for the long hours at work is the paycheck and the bonus.  the money is a great incentive, but its positive effect on your morale is not permanent. you really have to be passionate about the profession or have a very clear focus on your long-term goal in order to stick it out.  the only reason the pay is as good as it is, is just to attract talent/recent graduates to work there.  no reasonable, sane person would subject themselves to the corporate jail cell without the six figure salary.  the salary is just the bank paying you to not pursue something else that you find more interesting or more “productive” than crunching out excel spreadsheets and powerpoints.

the only upside from working at a bank is the learning–about industries, capital markets, how businesses operate, navigating the world of office politics, and the demerits of cubicle life. though you could read about each on wikipedia, going through it first hand is an invaluable experience. also, accumulating enough cash to make a pile on the ground for a session of “money shots” is pretty cool.  for some, however, it is major a concern to live a life comfortable and coddled by the paycheck and to wake up one day, an old man, filled with regret.


TL:DR; do you like money? are you ok with living at the office under a barrage of unjustifiable bullshit to get said money?



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