The £4,327 tax is only talking about the UK subsidiary, right? Because from their income statement [1], they paid $1.97B in income tax on $4.91B income before tax for a rate of 40.12%.
I might be misinterpreting something, but I think we should be careful to accuse them of abusing loopholes if they're still paying such a high rate overall.
As someone who has been in school for his entire life, I've always noticed that the average girl typically outperforms the average male in my classes. But it seems like the distribution of males was much wider.
For example, if each gender's academic capabilities were normally distributed, then I would expect the mean for girls to be higher than the mean for boys, but the variance for boys to be larger than the variance for girls. I say this because I tend to see many boys at the very bottom of my classes, but also at the very top.
Of course this is all based on my experiences in school, and I have no data to back this up. But I'd be interested in seeing distributions of academic performance for each gender.
> These are kids really really smart, socially adjusted (enough to be accepted by Ivy League), and hard working. If they entered science/medicine/engineering/etc, they would've added great positive impact.
I agree that students may be able to have a stronger impact as a doctor, scientist, etc. But this is more a criticism of K-12 education, not the wall street industry! I've never heard of a high schooler thinking "should I grow up and be a doctor, or should I be an investment banker?" What I have heard is "I'm smart but not very good at math, so I'll major in business." We do NOT have many students choosing investment banking over STEM during their junior year of college in the midst of recruiting. These decisions are being made during senior year of high school when they're thinking about what to major in.
> And now they are abandoning these vital industries that actually produce something for an industry that is basically pushing papers around and printing money in the process.
Basically pushing papers around and printing money? Are you kidding me? If investment banks are so useless, why would essentially all large corporations (including Apple, Facebook, Yahoo, etc.) hire investment banks to assist in raising debt and equity or to facilitate mergers and acquisitions? By suggesting that investment banks are "printing money," you've shown that you aren't well-informed on the industry.
If your criticism is coming from the recent financial crisis, then sure, the investment banks due deserve some of the blame. But anybody who says investment banks are exclusively responsible and refuses to point out the mistakes by credit rating agencies, insurance companies, the federal government, and even US citizens needs to find an objective source and study the events leading up to the crisis.
> I know we live in free economy society and all that but I think we need to find a way to 'regulate' how the wall street recruits.
Is someone being harmed? Given that the students entering investment banks are fairly intelligent and coming out of prestigious universities, they are also intelligent enough to find another job if they don't like working at the bank. All of these banks also have well-structured internship programs, giving the students an opportunity to test the experience. Yes, the lifestyle can be very difficult for two years. But it's a trade-off; students work very hard in exchange for a high salary and great exit opportunities.
> Lastly, I believe the ratio of liberal-arts majors entering Wall Street is way lower than the article seems to suggest. From what I hear, overwhleming majority of the graduates entering Wall Street after graduation are science/math/engineering majors.
That is certainly not the case. STEM may be a majority of the graduates entering fields like high-frequency trading, but STEM is a very small minority of the students entering investment banks. And investment banks are much larger (in terms of # employees) than HFT. I'm not defending high-frequency trading -- I agree it's billions of dollars being spent on something that's socially unproductive. But it's inaccurate to make a blanket statement about "wall street" and apply it to any finance-related career.
Investment banking gets a pretty bad reputation in the media, and there are many misconceptions about the industry. I don't think this article was terrible, but I do disagree with a few of the points. For the record, I'm an undergraduate student at a non-Ivy but huge feeder into investment banks.
> They're going because they hate risk and are terrified about what to do next and Wall Street has figured out a way to calm their anxieties.
This is somewhat accurate, but it doesn't seem different from other careers. Not all of friends know exactly what they want to do when they graduate. So it's logical for them to pick a job that is well-paying, will continue to exist for at least a few years, and offers good exit opportunities. For this reason, most of my intelligent friends in computer science are looking to work at Google, Amazon, Facebook, etc. Similarly, most of my intelligent friends in finance are looking to work at premier investment banks (or premier consulting firms like McKinsey, Bain, BCG, etc.).
> So they created the two-and-out program. The idea is you're there for two years and then you move onto something else. That let them attract not just hardcore econ majors but people majoring in other subjects who had a passing interest in finance and didn't know what else to do.
This is absolutely correct; it's well known that you'll stay for 2 years and then move on to another finance world (Private Equity, Hedge Fund, Venture Capital) or perhaps business school. But the way the article describes this feature makes it sound as an evil trick. Maybe I'm the only one who gets that vibe, but I think this is a great feature for students who aren't yet ready to commit to a career (again, not exclusive to finance).
> And it's amazing, anecdotally, how often you see college seniors deciding between making huge money on Wall Street or making almost nothing with Teach For America.
I had a conversation with a TFA rep a few months ago, and he told me that my school was the largest feeder into TFA. Yet, I have never met someone deciding between investment banking and Teach for America -- obviously two very different career options. The TFA rep also said the major with most students applying to TFA was Accounting, which makes sense because the entry job for an accounting student is not as high-paying or "exciting" as the entry investment banking job.
> Being a young banker seems like an incredibly miserable existence. The people you follow are beyond unhappy.
Yes, some of my friends who did investment banking internships (it's near impossible to get the full-time offer without an internship) ended up being miserable. However, some enjoyed the internship very much, and they return for full-time. Again, this isn't unique to banking. I'm had an engineering internship at a top tech firm, and I haven't enjoyed it as much as I expected either. Nevertheless, some of my friends in similar roles at other tech firms are probably enjoying their experience.
> I talked to one guy who's a former Goldman Sachs guy who left to go to the tech industry who said the adage in the tech world now is "be wary when the pretty people show up."
This is not common. I'm majoring in Finance and EE, so I'm one of the few people who would potentially be making this decision. If we're talking about choosing between banking at Goldman Sachs and working on the acquisitions team at Google, then sure, that's a legitimate argument. But the only time students are making the decision between being a software developer at a tech firm and being an investment banker is when they apply for college and decide on their major.
Overall, I didn't think the article was horrible, but there were a few things I wanted to clarify. And although I don't plan on working for an investment bank, I hate to see the career ridiculed by misconceptions. I saw in another comment that it doesn't really take intelligence to work at an investment bank or it's not really difficult to do. Please don't insult a career if you've never really experienced it. Some bankers may not be very smart, but others are ridiculously intelligent and great at their job.
I don't understand the arguments against the merger very well. From what I've read, there is currently very little overlap between the regions of Time Warner Cable and those of Comcast [1]. If this is correct, how could the merger allow either firm to raise the price?
There are also arguments that combining the customer base will give greater buying power when making deals over content (ex. complete broadcasting power over local sports franchises). But the combined customer base is supposed to be less than 30% of households that subscribe to cable or satellite TV [2].
I understand net neutrality is a huge concern, but that seems to be a separate issue from the Time Warner - Comcast merger. It looks like the problem (which is addressed at the end of the post) is higher barriers to entry from local governments. If that's the root cause of net neutrality, that probably deserves more focus than just preventing a merger.
I'm working on my first (major) project -- an app that will show live winning probabilities for each team in ongoing NBA games. I'm hoping to get it done before this year's NBA playoffs are over.
I just started, and I'm scraping JSON play-by-play data. This is my first experience with databases, so hopefully it works out well.
This blog post gives off the impression that you must beat the market to make money. Given the author's CFA and enrollment at a top business school, I'm sure the author knows this isn't true. But if I didn't know much about the stock market, I'd think it was zero-sum just from reading this blog post.
Nevertheless, I agree with the premise of this blog post, but I think the author should put more emphasis on the difference between passive management and active management.
Passively investing makes sense -- you can earn higher returns if you're willing to take on higher risk. Actively investing is what the author and I have issue with -- picking individual companies rather than trading the market as a whole.
As pathetic as it sounds, I don't really know what my goal is. I guess I want to find an internship this summer that is enjoyable and offers solid exit opportunities for full-time recruiting. I know this is a lot to ask for, but I want to highlight the fact that I work very hard -- I'm not some kid that thinks he's smart and deserves a perfect job.
The biggest problem is I know absolutely nothing about the recruiting process, job requirements, internship duties, etc. for programming roles. Since the start of 2013, I've worked a bit on my coding and published very small projects on GitHub, but I haven't done much else in terms of seeking an internship.
I'm most worried about switching my focus entirely from banking to programming and missing out on a banking internship. If I don't do investment banking this summer, I basically have no chance at a full-time investment banking position. And although I've made it sound like I absolutely hate banking already, there is a chance I could enjoy the internship and the full-time position.
I'm pretty sure I would like a programming role more, but again, I don't know where to start for recruiting. And I'm afraid that working for a small tech firm this summer may not help much when I look for a full-time job after college.
Thanks for the advice. It seems as our paths are very similar.
To be honest, my biggest interests are in statistics, programming, and finance (in that order). The most natural intersection seemed to be working at a proprietary trading firm. Unfortunately, I applied to over 25 prop shops with no success. I haven't heard of a single alumni from my school in trading; they typically only hire out of MIT, Harvard, Stanford, UPenn, etc.
After no luck with trading, I figured banking would be the next best option with numbers and finance.
Just out of curiosity, do you program in your free time? Do you think you'll eventually make the transition from banking to software development?
I might be misinterpreting something, but I think we should be careful to accuse them of abusing loopholes if they're still paying such a high rate overall.
[1] http://finance.yahoo.com/q/is?s=FB&annual