Matt's said before that he reached a certain point at GS where he was expected to get more involved in sales, as opposed to just the structuring side of his desk, and felt he was quite bad at it.
Probably quite a bit of self depreciation on Matt's part though given that when he decided to quit his boss essentially said, "Why don't you just, you know, take some time off to think about it?"
I'd say someone with Matt's background and general mannerisms - even at GS where eccentricity and raw intellect, for lack of better descriptors, are traditionally valued - would be a significant outlier.
I worked at GS and I think the only people that fit the Levine mold were in weird structuring desks, like Matt was. In particular, PFI had quite a few characters that remind me of Matt. Ali Meli, who left GS recently and was written up by Bloomberg, comes to mind. Clearly intellectually above others with weird, interesting perspectives on things. Also given leash to go dream up and do weird and interesting things.
I don't think people like Matt actually have much value add in most areas of a modern investment bank, unfortunately. As Matt says: banking is boring now. I don't see how someone like Matt would succeed is traditional banking - or a flow trading desk - over the "average" GS employee who studied finance at Wharton or whatever. Most areas of banking strike me as having become very commoditized or routinized and outliers are viewed as more apt to cause tail risk than anything.
I would recommend the following video that may not provide explicit answers, but will perhaps provide a contextual understanding for how you're feeling.
It sounds like you've slammed your new life full of ephemeral busywork to, well, keep yourself occupied. It also sounds like you don't have a professional network that relies on you and that you rely on (since you're financially independent and just poking around these days).
You may want to take a step back, enmesh yourself for a few weeks or months in all the possible paths you could focus yourself on (which will likely be chaotic and unenjoyable), and then just dedicate yourself to pursuing a given path. Try to build up a network, feel you are helping others in the network, and see where it all goes.
Whether this path ends up being financially fruitful or being conventionally successful along some other axis should be viewed as irrelevant given your current status. You'll likely find just having a thing to do, that other people are also working tangentially on or are interested in, will bring you all the success you need.
Do you happen to be from Quebec? I'm Canadian by birth and have wanted recently to learn Quebecois French, but have struggled with finding practical resources (as everyone seems to agree most French resources and learning programs are going to give you a rather half-baked understanding of Quebecois French).
My primary personal account is with HSBC. A few years ago the login infrastructure - with the little keypad you had to use, etc. - was ridiculous and their app was only a bit better.
However, over the past few years they've really improved. The website is now consistent across all tabs (at least that I use for personal banking) and the app is simplified with most functionality needed for personal use in there.
On the personal side, I've always found the people at branches of HSBC (regardless of where you go) to be courteous and professional relative to the few others banks I have accounts with. I'm not in the UK, so perhaps things are different there, but in North America I've found them to be a slight step above average (insofar as you can be for retail banking --- it's all relative!).
Your default perspective appears to be that U.S. domestic and national security policy is the sole remit of unelected authority figures (e.g. "...just because someone at the Pentagon claims something is the US best interests doesn't mean it is.").
U.S. domestic and national security policy is certainly refined by unelected folks within various departments and agencies, but the overarching direction comes via elected representatives selected by the people.
Senator Warren and Senator Sanders - if elected president - would likely make the contracts in question (related to oil/gas and AI in the military) obsolete. If the American people feel aligned with their views on these issues - among others - and elect them and folks like them to the house and senate then you'll see a fundamentally different set of domestic and foreign policy objectives.
> However, your position that since they're the authority figures, anybody who questions them is not an "adult", strikes me as extremely asinine and highly dangerous.
This reads like a moral screed. That's fine. They're entitled to their own views, to voice those views internally, and if they aren't adopted to leave the company and write a polemic.
Ultimately, two thirds of their complaints involve taking a position counter to the stated national interest of the United States. Sure, maybe they believe that national interest is wrong, morally objectionable, or whatever, but the inference you draw from the writing is that it clearly is. That everyone at Google knows this is wrong, should be stopped, but isn't because of the monetary gains of doing these things.
> 2. Google Cloud sales to the oil and gas industry
I mean, if Google Cloud makes the extraction of natural gas more efficient then that strikes me as a net good for the planet. A large part of the emissions decrease in the U.S. over the past decade is from the economic viability of natural gas relative to coal. Dream of a bucolic lifestyle all you want, but reality should be confronted in these matters.
3. Expansion into the weapons industry and the business of killing
The business of killing terrorists - with increasing levels of precision - strikes me (and every administration in memory) as clearly being in the national best interest. The better targeting capacity available, the less collateral damage and need for U.S. boots on the ground abroad there will be.
You can, of course, find drone strikes morally objectionable. You can find killing what are deemed threats to the homeland as objectionable. That's fine. But to state this as an objective truth is to find yourself holding a position at odds with nearly all elected law makers.
If you, as a company, agree or disagree with U.S. domestic and national security policy, fill your boots. But Google working in concert with the U.S. domestic and national security policies isn't choosing money over morality per se.
People have different perspectives and these people clearly have perspectives unaligned with their former employers. Good on them for leaving. However, I have to say reading this screed makes it seem like the adults in the room are the executives they lambast.
There is also an increasing issue in Canada of minor operations being delayed to the point where major surgical intervention is eventually needed.
With the medical system over-burdened, the system is now fundamentally reactionary in many specialties; delaying anything that can possibly be delayed.
It's saving a penny today to pay a dollar (or a loonie, I should say) tomorrow. It's economically burdensome and, obviously, creates a great deal of unnecessary hardship for those in line.
Nearly every Canadian has anecdotal stories of elderly relatively who had a minor ailment that needed surgery - were delayed for months because they were
low priority - and then needed a larger intervention as the problem compounded over said months.
Where does this show up in the data? How do you measure and value up to a year - which can be more than 10% of an elderly persons remaining life - being mired in uncertainty, discomfort, and pain waiting for a procedure? How do you measure medical efficiency and patient outcomes in this context?
The best way to describe the current system is that doctors (surgeons, in particular) are forced not to look out for the individual patient's best interest, but the best interest of their entire surgical waiting list in aggregate (and this can be dozens of names long).
So, yes, it is in the best interest of Patient X to have the minor operation done this week as there is a strong likelihood of further complications and a worse patient outcome if delayed. However, Patient Y needs a major surgery this week so Patient Y, rationally, gets the higher priority.
Thanks very much. These were all read before the 2016 election, if that's what you mean. I think they are important books for our times certainly though.
Depends on your definition of practically unknown. With that said, these are the four that immediately spring to mind as being both worth reading and relatively obscure (judging by date of publication in conjunction with being either out of print or with very few star ratings on Amazon).
Did Monetary Forces Cause the Great Depression? - Peter Termin, 1975
Termin is still going strong at MIT. His 1975 book was foundational for challenging Friedman on the cause of the Great Depression. Given what was to come in the 1980s this book quickly became overshadowed and destined for obscurity. However, it still provides an appropriate, timely lens to analyze monetary theory without the abstraction that has engrossed economics as of late.
The Supreme Court in the American System of Government - Robert Jackson, 1955
A series of lectures created for a Harvard lecture series in 1954-55 by Justice Jackson. He suddenly died before being able to deliver them, but they were compiled in a book now out of print. Justice Jackson is widely regarded - across the aisle - as one of the most brilliant legal writers of our time (or perhaps of any time). While this book doesn't set out his entire judicial philosophy, or even do what the title says due to his untimely death, it does lay a valuable conception of the proper role of the SCOTUS within the Republic. Also recommended, to see both his pen and intellect in action, are his opinions in Korematsu v. United States and West Virginia State Board of Education v. Barnette.
The Opium of the Intellectuals - Aron, 1955
Amazon does a better job of summarizing than I could off the top of my head, so here you go: "Raymond Aron's 1955 masterpiece The Opium of the Intellectuals, is one of the great works of twentieth- century political reflection. Aron shows how noble ideas can slide into the tyranny of "secular religion" and emphasizes how political thought has the profound responsibility of telling the truth about social and political reality-in all its mundane imperfections and tragic complexities."
An incredibly difficult read that is worth trying to get through. Brimming with ideas and not without its own pitfalls. Tells the story of 20th Century intellectual history and thought as well as any could, although in a rather indirect way.
The Protestant Establishment: Aristocracy and Caste in America (Aristocracy & Caste in America) - Baltzell, 1987
I'll let Amazon summarize again: "This classic account of the traditional upper class in America traces its origins, lifestyles, and political and social attitudes from the time of Theodore Roosevelt to that of John F. Kennedy. Sociologist E. Digby Baltzell describes the problems of exclusion and prejudice within the community of white Anglo-Saxon Protestants (or WASPs, an acronym he coined) and predicts with amazing accuracy what will happen when this inbred group is forced to share privilege and power with talented members of minority groups."
My summary would be: what will happen (hypothetically, remember the date of publication) when an ephemeral class (WASPs) suddenly disappear from their previous pedestal of influence? Prescient, widely applicable to other countries with their own quasi-classes, and deeply interesting for those less familiar with the subject.
Because your post is quite far down, I'm not sure it'll get many views/replies. Just wanted to say that I read it all and it's both informative, interesting, and (regrettably) demoralizing.
In my first year of college I wanted to be a doctor and landed an absurd position - in hindsight - over my freshman summer where I was in the operating room with my surgeon nearly everyday (he led the residents). I tagged along through all the rounds, operations, and (of course) the tedious paperwork and billings.
By the end of the summer I was entirely jaded and switched programs. I still often think about whether or not I should have stuck it out.
However, what I ultimately saw (as you mentioned) were residents at this top, well-funded hospital who deeply loved medicine when they began medical school fall into a deeply jaded, pessimistic state. They made no money (while living in a high CoL city), were consistently overworked, and riddled with anxiety about where they would actually get a job post-residency.
Becoming a doctor - a surgeon in particular - struck me as a dozen year journey of constant make-or-break tests, quasi-lotteries with regards to residencies/fellowships, and then complete ambiguity as to where you would actually work when it was all done and you hit your mid-thirties. It also seemed increasingly devoid of any kind of professional autonomy and, most surprising to me, was how ungrateful and mean-spirited many patients were. Their lives would be saved, but they would yell at the surgeons over cosmetic concerns about the scars.
I often wonder whether my experience was not representative or simply too much to absorb as an 18-year-old at the time. However, the only folks I've talked to who seem to be truly satisfied and content with their careers are family doctors operating (largely) on their own terms and making 200-300k a year.
EDIT: I should say, I wish you the best moving forward and hope you find a level of contentment and happiness in a bruising - to put it mildly - system.
If you're interested in this, you'll likely enjoy Gregory's interview on Masters in Business (a Bloomberg podcast) from last Wednesday. Also, Gregory's book will be out in a few days.
If memory serves, in the aforementioned podcast Gregory mentions that the RenTech generally holds most things for a few days (sometimes a few hours). However, they don't engage in HFT or HFT-like trading. This was surprising to me as I assumed it was all reasonably short holdings (relatively speaking), although I knew they weren't a pure HFT firm.
I also seem to recall Gregory mentioning there's some kind of running joke internally that their trading systems aren't nearly as good as they should be (or like what you would find at HFT firms). Given the intellectual and monetary heft within RenTech perhaps that's a bit of false modesty on their part.
I'll be interested in reading Gregory's book as he does seem to have put together a lot of novel information on RenTech. However, he does seem to suggest that very little of the day-to-day workings of the firm will be explored, which would obviously be immensely interesting.
EDIT: RenTech has several funds, it should be noted. Some of which still take outside capital. What I've said above may have only been applicable to the Medallion fund.
This is exactly right. Although your suggestion that a congressional law would overturn Citizens United is not necessarily true. It's a difficult question given the basis of the original decision.
With that said, I'm rather surprised at how poorly constructed this letter is. If you're going to trot out trivial platitudes, you might as well go full bore and craft a persuasive polemic.
Instead this letter reads to me as a mealy-mouthed, mushy argument crafted by people who self-evidently favor paternalistic oversight when their letter does little to persuade me these are the people who should have any oversight over anything at all.
Ironically, if a politician of a favourable political persuasion linked to this letter in an ad I'm not sure how it could not be labeled as "misleading". It posits things that directly render many of the underlying "solutions" moot. The argument is broken almost immediately after it begins.
The best treatment of Citizens United I've seen is by Laurence Tribe - who no one of any merit would consider an apologist for Republicans or a textualist - in his book "Uncertain Justice: The Roberts Court and the Constitution". The actual decision itself reads well and is worth everyone's time.
I wouldn't disagree with any of this except to suggest my comment was narrowly tailored to parents who feel compelled to provide their children "the very best" education and opportunity set in the country (predicated on ranking and exclusivity). If you believe American parents who aim toward this have an undue paranoia about class and an unhealthy amount of insecurity, then I'm afraid we entirely agree.
However, the point was that in Canada, because the peaks are lower, getting "the very best" education is much more readily achievable by those in the middle than in the United States.
> If you want to know why many Americans don’t view their country as a loaf-apocalyptic wasteland, it’s because they don’t live in New York or San Francisco.
I certainly hope my post hasn't given this impression. I have a green card and am proudly in the pipeline to become an American citizen.
This is a wonderful, special country which has provided me immense opportunity that does not exist within Canada (the primary thrust of my original post).
I have thought about this quite a bit and tried to word my initial post as a personal statement (not an objective fact of the inferiority of making $50k in Kansas as opposed to Quebec).
I entirely agree with your point that American families in Kansas, et al. seem reasonably content and the kind of fears that would lead me to look to Canada over the U.S. if I made $50-100k are perhaps entirely irrational.
My response though - again personal in nature, not objective in any sense - would be:
Canadians grew up in Canada with an imperfect healthcare system. Nevertheless, it's there and assessable whenever it is needed. There's no fear of random bills or imperfect coverage (there is a fear of waiting weeks or months, however, which is perhaps more important).
Canadian immigrants only understand the U.S. healthcare system in the abstract -- so losing your health insurance or having it and getting dinged with a large bill is a bit of a boogeyman (scary, but perhaps only because we don't fully understand how it all works in practice).
Likewise K-12 and college in Canada is a much simpler affair. I grew up in a city of 100,000. We had no private schools so everyone went to K-12 together. When it came time to go to university, my top-ranked school (in Canada) cost $7,000 a year and was quite easy to get into.
So for a middle-class Canadian family the notion of setting up your child to have the very best Canadian education available isn't an overly stressful affair. K-12 is public and college is reasonably affordable with reasonably high acceptance rates. Importantly: even if private K-12 is available, it's not overly difficult to get into McGill, et al. so why bother?
For a middle-class American family - because private K-12 is available and likely helps with getting into the best colleges - you feel somewhat compelled to send your child there (lest you do them a disservice). Then - again because elite colleges are available and better than privates - you feel compelled to help your child get into and pay for an elite, private education (even the top public options are quite pricey).
In reality what America provides is better alternatives. An issue I see with many colleagues with children is spending $10k a year on private K-12, but feeling like a bad parent because they can't afford the $30k option that has superior outcomes (a classic urban insecurity that is likely not entirely rational). In Canada there are few choices (or in health care only one choice) and while they are inferior to American comparables, they are much more widely assessable. You send your child to the public K-12, because that's just what's available. Your child has just one healthcare option. Your child can only pick from four "elite" universities and if she or he applies to them all, will likely get into one (at a reasonable cost).
I was born and raised in Canada. I, like many of my peers at the "top" Canadian universities, focused solely on recruiting to the "top" American companies that came to campus to recruit[1].
I would describe Canada as generally being tightly range bound. One of the most striking things about coming to the U.S. is the large class of what I would consider to be the working poor. People who are truly just doing enough to get by and are one mishap away from financial ruin. Of course, having lived in SF and NYC this is constantly juxtaposed with extreme, incomprehensible wealth that is equally striking.
In Canada, in my experience, the vast majority are still in the middle with few outliers in either direction. Earning potentials are significantly capped - even in areas like banking and tech - and social programs make it quite difficult for there to be the kind of working poor I observe daily here.
I've often thought to myself that I couldn't imagine what it would be like to make $50k in the United States (even living in a low CoL area). From health insurance, to private school costs (given the quality of many public schools), to college costs. It would seem an intense burden. Certainly if I had offers that paid between $50-100k in both the U.S. and Canada I would move back to Canada. I would feel I have no other choice.
With all that said, I make many multiples - especially after tax - of what I could ever have hoped to make in Canada. I have been inside institutions with the kind of institutional framework with no comparable in Canada (from a human capital and technological perspective). Opportunities have been afforded to me here that either do not exist or are analogous, but significantly inferior in Canada. The United States has given me a wonderful life and I'll always be grateful for the opportunity to be here.
I make no claim as to which economic system is better. I would just observe that Canada is a much easier place to live, but in my experience lacking in the kind of dynamism you see in the United States (that translates into personal opportunities, income, and fulfilment).
[1] Top is obviously somewhat subjective. McGill, U of T, UBC, and U of Waterloo would be the "top" schools. The "top" jobs are FANG or FANG-adjacent, investment banks or hedge funds (GS, JPM, Citadel, etc.), and consulting firms (McKinsey, BCG, Bain).
You'll notice in this graphic the sharp jump in holdings that corresponds to around October. This is when - for foreign buyers - the yield curve really inverted for practical purposes, leading to primary dealers filling up their books, which I detailed a bit in my initial post.
Sure, it's slightly complicated. Some may quibble on my somewhat explicit wording, but under the primary dealer system the Treasury can unequivocally ensure that auctions clear lest designations be stripped. It's hard to articulate how much an auction failure would disturb money markets. Therefore, clearing bond auctions is the highest possible priority of the Treasury and FRBNY and you saw JPM in Dec 18 taking it on the chin to make auctions clear (as there was surprise about the utter lack of foreign interest).
"The FRBNY also expects primary dealers to demonstrate their continued commitment to the market for Treasury securities by bidding meaningfully in all Treasury auctions. If a dealer fails to bid meaningfully in an auction, the FRBNY typically contacts that dealer to remind it of its so-called "underwriting" responsibilities."[1]
I find the general interest of the public in inversions - similar to their interest in negative yields - a bit surprising. I suppose it must be due to these concepts seeming counter-intuitive. Some brief notes, not all of which are meant to tie seamlessly together:
1. What's the lag time? Inversions in the past have had rather large lag times before recessions actually began (most recently they've been 24 months, 13 months, and 19 months for 2s10s). Inverted yield curves signal anticipation of future rate cuts or long-term rates staying the same or whatever (depends on the shape, obviously), but if you're of the view that global yields are just going to stay low for the foreseeable future (an increasingly common view, I make no claim as to my agreement with it) then sure the US and UK need to adjust down and get flatter. Why is there not a recognition of a new normal going on here? It's not like money is outrageously expensive or developed economies have been running hot (as historically inversions have indicated). We've had a decade of reasonably good growth in the US and UK with very low rates and the assumption was that long-term rates would be ~3-4%. Maybe money will just always be relatively cheaper now with long-term targets around 2-3%.
2. How expensive is money? In the past when inversions have occurred the Fed Funds rate has been significantly above inflation (sometimes by hundreds of bps), making money outright expensive. Money right now is relatively expensive (compared to the past 10 years, post GFC), but historically we're still talking about money being very cheap. I'm a bit of a relativist, but I think you need to make a distinction between money that is outright expensive and money that isn't (as is currently the case).
3. Where's high yield going? Over the past month a bit up. But this is after we've seem high yield spreads compress in to historically tight levels. Cov-Lite offerings are still being printed and snatched up despite the inversion of 3ms10s we've seen for a few months now.
4. Is there an issue in our financial systems plumbing? In my view, yes. The yield curve has been inverted for foreign-buyers (over 2016-2018 a very important buyer of treasuries) because they don't fund around the 3m point, but rather on (OIS + Libor-OIS spread + XCCY of the relevant currency). If you're a Japanese life insurer or European pension fund you can't take FX risk (FX markets are volatile!) so you need to swap back into your local currency.
These hedging costs got to a point last October where you're facing significantly negative yields (practically speaking) for foreign buyers so they buy their local negative yielding debt instead (as it's a relatively better investment). Because US auctions can't fail - primary dealers need to act as a back stop - you've had firms like JPM and BofA taking on huge amounts of treasuries. This has really clogged the o/n repo market and is beginning to distort bank balance sheets. They can't keep absorbing the amount of issuance the Treasury is pumping out with these trillion-dollar deficits. There's also an issue of bill-issuance notional amounts and banks trying to elongate their duration which is dampening down the 10yr.
The Fed needs to cut rates further - in my view - to steepen out the yield curve to get foreign buyers coming back in. It'll probably need to be at least 75-100bps from here to get meaningful purchases. The Fed has really pushed themselves into a tight spot from a pluming perspective.
5. Yields down, prices up. If you bought the 100yr Austrian bond you'd get negative yields, yes. Also if you bought the bond a few years ago you would have outperformed equities on an absolute basis. So, like, negative yields aren't great, but asset appreciation from a sovereign bond with no default risk going into more negative territory is good if you're a fast money player (the bond price is nearly $200 now!). In fact, it's even good for a pension fund who has no intention of holding to maturity.
Probably quite a bit of self depreciation on Matt's part though given that when he decided to quit his boss essentially said, "Why don't you just, you know, take some time off to think about it?"
I'd say someone with Matt's background and general mannerisms - even at GS where eccentricity and raw intellect, for lack of better descriptors, are traditionally valued - would be a significant outlier.
I worked at GS and I think the only people that fit the Levine mold were in weird structuring desks, like Matt was. In particular, PFI had quite a few characters that remind me of Matt. Ali Meli, who left GS recently and was written up by Bloomberg, comes to mind. Clearly intellectually above others with weird, interesting perspectives on things. Also given leash to go dream up and do weird and interesting things.
I don't think people like Matt actually have much value add in most areas of a modern investment bank, unfortunately. As Matt says: banking is boring now. I don't see how someone like Matt would succeed is traditional banking - or a flow trading desk - over the "average" GS employee who studied finance at Wharton or whatever. Most areas of banking strike me as having become very commoditized or routinized and outliers are viewed as more apt to cause tail risk than anything.