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With Finance Disgraced, Which Career Will Be King?

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Interesting article from NYT education section
http://www.nytimes.com/2009/04/12/weekinreview/12lohr.html?_r=1&ref=education&pagewanted=all

Today, the financial crisis and the economic downturn are likely to alter drastically the career paths of future years. The contours of the shift are still in flux, in part because there is so much uncertainty about the shape of the economic landscape and the job market ahead.

But choosing a career is a guess about the future in which economics is only part of the calculation. Prestige, peer expectations and the climate of public opinion also matter. And early indications suggest new career directions that are tethered less to the dream of an immediate six-figure paycheck on Wall Street than to the demands of a new public agenda to solve the nation's problems.
Still, the industry whose troubles are having the greatest impact on the rethinking of careers, especially at the nation's elite universities, is the one at the center of the country's economic downturn — finance. For years, the hefty paychecks and social status on Wall Street proved irresistible to many of America's brightest young people, but the jobs, money and social respect there are much diminished today.
 
Those people going into Teach For America will quickly find that their threadbare paycheck is going to quickly fly into the face of whatever respect and self-esteem they'll be chasing. What follows is obscurity and finally the realization that they'll be nothing more than another statistic in the grand scheme of things.

All I see are the people that actually get it right--Paulson, Soros, Shaw, Simons...the money is still every bit as much in finance as it ever was if not greater for those who are genuinely willing to learn and not just chasing an image.

Maybe this is a return to the Wall Street of old times, in which firms were smaller, a man's word was his bond, and companies thrived on being solidly successful than colossal failures.
 
I beg to differ..

Several things:

1. Many people do it because they truly enjoy teaching. I believe you are grossly generalizing when you assume they are all chasing 'respect and self-esteem'. Further, what do you mean 'statistic in the grand scheme of things'? Are we talking about your grand scheme of things? (which, I believe, would include yourself morphing into a God.. AKA a certain Jim Simons). I find it rather disturbing when one imposes his life goals upon others.

2. Also, Ilya, for someone who has been complaining about inequality of opportunities, wouldn't you agree that an expanded TFA program helps bridge that disparity?

3. Less importantly, TFA is considered a 'feeder school' by many firms (think GS, BCG..). Many students take the opportunity to explore a career path they'd never consider before via TFA, safe in the knowledge that many corporate employers appreciate that career exploration. In all, I'm arguing that TFA is a fantastic career choice for many (based on what they seek in life).

4. In addition, you were arguing that 'the money is still every bit as much in finance', based upon your observation of successful managers. That's a very skewed sample there. The fact that you disregard a disproportionate amount of people losing money out there precisely induces survivorship bias. Regarding a fresh college graduate, I also doubt that 'willingness to learn and not just chasing an image' are sufficient conditions to ensure his/her success in this type of environment.

N.B. I have been a long-time lurker (hence my knowledge of one's obsession with particular financial institutions..). I don't go to Baruch (rather, to another program in the tri-state area).. but biggest thanks to all the Baruch students that post here -- you've created a fantastic community and hub of resources.
 
No not in my grand scheme of things. Think Brin, Gates, and if MfA does well, Simons. Someone whose name outlives them. That's what I mean.

As for survivorship bias, I said there is still the money for those that do it *correctly*, meaning not any manager that goes up on the roller coaster and comes down on that same coaster. The good ones are the ones that go up...and then KEEP going up. Ahem...160% in 2008?

As for inequality of opportunity, there's a reason that TFA volunteers only stick around for two years. It's not a long term thing. Education is the most critical foundation in terms of what can be improved (there's not much you can do to improve parenting), but I don't think TFA is the answer.

Remember, not all of us come from well off families. Some of us actually *do* have to worry about a paycheck. And if you've read my blog thoroughly, you'd know that my opinion is different due to my own set of circumstances.
 
Quoting from the NYT article, the respect is gone, that's for sure. The jobs are fewer and more precarious and the money is less. Finance people are not perceived as masters of the universe anymore and I don't think they perceive themselves that way anymore either. They're seen as part of the problem and not as part of any solution. But anyway, as Paul Wilmott says somewhere, PDEs are forever.
 
The closer to money you are, the more you make. It will always be true. Even in communist countries. Therefore working in Finance will be desirable.

Now we are facing consequences of burst bubble and a lot of people getting fired. Most of them shouldn't be doing Finance at the first place. They will move to the next big thing and Finance job market will become normal in a few years. It reminds me IT mania of 90's. When people were hired for 6-figure salaries after completing 1 month computer-preparation course. Most of them left IT after bubble burst. However, IT is still creditable profession where you can make a good living.
 
'No not in my grand scheme of things. Think Brin, Gates, and if MfA does well, Simons. Someone whose name outlives them. That's what I mean.'

I still don't get this. What do you mean? Are you saying that the existence of these very few people allow you to bash other's career choices? Are you holding everyone to such standards that include Gates, Brin and Simons? (I think, these people are successful as a combination of exceptional intelligence, hard work, and being lucky.) Not everyone can be them, and I find it's equally respectable to pursue other things (that does not necessarily engrave your name in history via massive accumulation of wealth), as long as you love what you do.

Also.. of course there are still money for the ones who survives! That's the whole definition of the bias. The point of the article was to note a probable shift of labor supply from finance to other lines of work, given a decrease in the wage differential. You argue that what's important is to focus on the outlier samples. I argue that, along the lines of the article, I think mere mortals like us (pun intended) need to realize that 'the jobs are fewer and more precarious and the money is less' (BBW). I mean, it's not good being delusional about all of us being the next Jim Simons, let alone in these times, no?

Finally, I don't have that much time at hand to be perusing your blog. (Rudin has been keeping me busy). But I'm not sure if a disadvantaged background bestows the right to question others' life choices. We are talking about a very personal choice, and like you pointed yourself, they might have come from very different background than yours that led them to different career goals.
 
The closer to money you are, the more you make. It will always be true. Even in communist countries. Therefore working in Finance will be desirable.

Now we are facing consequences of burst bubble and a lot of people getting fired. Most of them shouldn't be doing Finance at the first place. They will move to the next big thing and Finance job market will become normal in a few years. It reminds me IT mania of 90's. When people were hired for 6-figure salaries after completing 1 month computer-preparation course. Most of them left IT after bubble burst. However, IT is still creditable profession where you can make a good living.

Fully agree with your observations. Very good post.=D>
 
Massive wealth to me is not an end. It is simply a means, since only money talks, and only the successful are respected. The accumulation of wealth to me is boring, as is its pursuit, and so is the possession of it. Green paper is meaningless after you are able to fulfill all of your needs. However, it is massively important to ensure that you have enough money to never worry about it while you can build a family and provide for them a dignified existence, free from any sort of stress that arises from financial issues.

It's the status that wealth brings, and the fact that you can be listened to, and have power to bring about positive change, and change people's lives for the better that counts for me. The reason why I'm such a massive fan of Simons is Math for America. The man is honestly trying to bring about a massive positive change, and I respect that as much as Medallion.
 
Well, since you seem to be so disinterested in addressing my questions to you regarding your imposing your career ideals on others -- I will respect your silence and drop the issue there.
 
Imposing? No, I just think it's a bit of a pity...these are Ivy League graduates that are destined for great things from such selective institutions that every time I see one go to TFA, I feel that their spot in those institutions would be much better suited to someone a bit hungrier for success on a greater scale.

Is it imposing? Perhaps. I just feel that every person should strive to be the best they can possibly be.
 
Interesting reply, to say the least. As someone who attended two Ivies, allow me to offer you my thoughts:

I find your 'pity' towards people who decided to do what they love (TFA, in our case) to be unwarranted at best. The fact that you feel 'pity' towards these people implies that you believe you know better what they should do with their lives. Now, short of having some sort of crystal ball, how can you claim to know what career path is optimal for each people, given their different abilities and interests?

Again, I am questioning your supposed omniscience that allows you to so kindly 'pity' people that did not pursue a career you deem optimal. The fact is, some of these bright students made all the right life decisions that led them to admissions to top schools. And now you think all of a sudden they'd make bad decisions? I tend to think that most people know what is good for them.

You claimed that Ivy League students without drive do not merit their spot in that institution. Who are you using as a yardstick for 'drive'? Yourself? Not only it's an incomplete parameters for merit (where's ability?), it's also hardly objective.

The fact that they are in that very institution is a testament that they are hungry enough to get in. Have you seen the admission statistics for these schools? Sure, you can argue for athletes and legacies all you want, but their significance are diminishing quickly with pool of applicants' increased competitiveness. (Also, some of the fiercest competitors I've seen in my school are athletes/legacies, since they have a chip on their shoulders). It is incendiary to say that people do not merit their positions, when you are only making assumptions as to how they got there.

I still believe that you are wrongly imposing your goals to others, and some more. If you think this is not the case, then I challenge you to prove your previous claims. I hope I am wrong, but you came off as terribly condescending and sadly narrow-sighted. Alternatively, you could've been God, which explains why I am clearly wrong and all these things are obvious to you. (Pun intended, wholeheartedly)
 
Look, I'm not exactly sure how best to put it since my entire opinion seems me imposing my goals upon others, and don't get me wrong, I think teaching is a great calling (albeit not for me), but...

Couldn't someone else, instead of that future TFAer, have gone to said Ivy and instead went onto become a geo-engineer, working on projects such as improving paint-on solar panels, working on computer technology in order to make self-driving cars a reality, work on zero-emissions vehicles, etc...

It's not that I pity those who have chosen teaching...it's that I pity those that could have used that Ivy League name to go on and do huge things. Do I think teaching isn't huge? At the rate of 30 kids in a classroom in an understaffed k-12 school, I feel it is a futile battle, hence the high turnover rate.

Frankly, I think so many teachers across America are fighting a losing battle in k-12 schools, due to the anti-intellectual culture here in the U.S. of "the true small-town blue-collar American who's too simple-minded to be caught in the corruption of the politicians and the 'best and the brightest' on Wall Street".

I believe that it doesn't matter how many Harvard/Yale/Princeton kids with ideals you throw at the problem--the problem is deeper than that. I honestly and truly believe that it is a societal problem with lack of motivation to go and learn. So many kids in school, rather than do math problems, would rather shoot hoops/play cards/you name it.

Being a member of a math club/chess club/other intellectual group is seen as a stigma or a niche position. We are no longer in the days of Apollo vs. Sputnik, during which intelligence was king. These days, we have abundance of everything, and most want instant gratification, and see studying as a stigma.

Anyone out of TFA who can motivate those kids to actually see intellectualism as a guiding light in my eyes is a hero and commendable--however, this also begs a couple of questions:

1) How many of these idealistic Ivy kids achieve that

and

2) Why do you need an Ivy League school to train those kids?
 
Let me address your specific questions: TFA applications this year reaches 35,000, a sizeable number, no? Why would you need an Ivy League degree? You don't. But it doesn't hurt to have one. Having a teacher that has gone to a great school inspires the students, much alike we are inspired by our professors who have done great things. Think of your professors.. Jim Simons?

You say that you 'pity those that could have used that Ivy League name to go on and do huge things'. That's utter nonsense. Your scheme assumes that colleges can differentiate between the kids who will go on to become the next greatest researcher, and the kids who 'merely' makes it to TFA. They're all intelligent, and that's all that matters from a college's point of view. Further, they want to build a diverse set of students so that they're exposed to multiple points of view in life. I definitely benefited from having plenty of friends in other disciplines. You keep on saying that there are others that can make better use of that Ivy League degree. How can you prove that claim?

What my friends that go to TFA do with their lives and careers has nothing to do with you. You have no right to tell them what they should do; conversely, they have no moral obligation to follow what others tell them to do. Would you rather have me tell you to stop dreaming of becoming a quant, given your current state? Probably not, and I think it's wrong to do that. I think a man should be free to pursue his desires if that is what makes him happy.

I think TFA is part of the solution; you don't seem to think so. It's also scary to think that you are advocating for less K-12 education push, precisely at the time where we really need it. What? You want us to just stop caring about them because it's a losing battle? What will happen in a generation's time if everyone shares your sentiment?
 
No, I don't want us to stop caring. In fact, I think we need much *better* k-12 education. I just don't think TFA is the way to do it. I have an alternative theory about it which I'm currently writing to my blog. It more or less involves a dusting off of a very old idea combined with the philosophy of putting veggies into brownies.

Certainly I think our k-12 needs massive improvement.

As for top class researchers...well, I'd venture to say that those who go into engineering and the sciences are hopefully there for a reason.

As for the Ivy League degrees, at what point do people start understanding "Harvard Degree" vs. "Math Teacher"?

We here in the U.S. already spend the most in the world per student in k-12. The system is broken, and idealistic kids that can leave at any time aren't going to fix it. I feel there needs to be a more innovative solution than the conventional way. 2 hours in school for 180 days between math and science in k-12 doesn't cut it these days. There needs to be a way to take math outside the classroom, which I don't think that even Jim Simons himself does an adequate job of addressing.
 
You have too many en grained misconceptions about Ivy League schools. It will take a while for bluechimp to change them :)
The interesting part is this perception about "pure superiority of Ivy League" or that "Ivy League students are guaranteed to reach loftiest goals" is pretty common.
Many people are shocked to find this "status" does not provide everything in most positions including financial services.

So then, what is wrong with a career in teaching?
 
I'll just say that I'm sticking to chemical engineering. I was looking at going into finance after graduation, but decided not to because of everything. I'm currently working for a very large agribusiness doing process optimization. I love my job. I get to go into the plant as well as sit at my desk programming Fortran or whatever. My plan is to do my best I can because there are a lot of opportunities within the company for what I'm doing since there are so few working on process optimization. But it doesn't mean that I'm giving up on finance. I still trade options during lunch and futures at night. Last year I made 40% on my trading. My philosophy is just work hard at what you are good at, and the money and promotions will follow.
 
If you remove the Unions in teaching, in your opinion, what are you going to achieve?
 
It's not that I pity those who have chosen teaching...it's that I pity those that could have used that Ivy League name to go on and do huge things. Do I think teaching isn't huge? At the rate of 30 kids in a classroom in an understaffed k-12 school, I feel it is a futile battle, hence the high turnover rate.

Again you're confusing different things. That the battle is uphill for the hapless American teacher is beside the point. The question you should be addressing is: Is the calling to teaching a "huge" thing? Or are you suggesting people take the easy way out each time? That since a socially necessary activity like teaching is beset with practical difficulties, low esteem, and low pay, it should be consigned to graduates of Swampwater U, while the lofty Harvard types take the plum jobs on Wall Street where they presumably do "huge" things like feather their own nests?

What's so "huge" about making a pile of money? By this criterion we should adulate every billionaire drug trafficker or every kleptomaniac Russian billionaire. Yet what have they achieved of enduring worth for their societies? I don't think cheerleading the Gordon Gekkos of this world serves any purpose.

Teaching on the other hand is a calling. It is a socially useful activity. That it's held in low esteem in a venal society like the USA -- a low esteem you echo -- is another matter.

Frankly, I think so many teachers across America are fighting a losing battle in k-12 schools, due to the anti-intellectual culture here in the U.S. of "the true small-town blue-collar American who's too simple-minded to be caught in the corruption of the politicians and the 'best and the brightest' on Wall Street".
Is that the teacher's fault? And people like you are fostering an anti-intellectual attitude by their single-minded adulation of the rich and "successful." Maybe we should build a temple to Donald Trump.

I believe that it doesn't matter how many Harvard/Yale/Princeton kids with ideals you throw at the problem--the problem is deeper than that. I honestly and truly believe that it is a societal problem with lack of motivation to go and learn. So many kids in school, rather than do math problems, would rather shoot hoops/play cards/you name it.
You're running all over the place, not making sustained and coherent arguments. The problem is "deeper" and part of the reason it's deeper is the contempt of commercial types -- including yourself -- for the world of ideas, intellect, and instruction for its own sake.

There is no harm -- and possibly some good -- in Princeton graduates being exposed to teaching, to a different social milieu, and to some of society's problems. Maybe once they reach the cloistered world of executive boardrooms they will have a better appreciation of the links between their decisions and what happens in the broader world outside. A social conscience will do them no harm and may do society some good.

Being a member of a math club/chess club/other intellectual group is seen as a stigma or a niche position. We are no longer in the days of Apollo vs. Sputnik, during which intelligence was king. These days, we have abundance of everything, and most want instant gratification, and see studying as a stigma.
So? I don't understand your line of argument. Your different "points" are not welded together to make a coherent argument.

Anyone out of TFA who can motivate those kids to actually see intellectualism as a guiding light in my eyes is a hero and commendable--however, this also begs a couple of questions ...
And now you seem to be contradicting yourself. Earlier you've been claiming these people have been wasting their time and should be going on to do "huge things"; now you do a volte-face and claim that if they succeed as teachers they are heroes. Surely these two statements are at odds with each other?
 
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