Re:One of Wall Street’s Most Popular Trading Strategies Is N...
by roenxi on Sunday March 03, 2019 @08:02AM
(#19294251)
> I used to be a sell-side trader, allocation of capital was the last thing on our minds.
Bit risky telling someone what their job is, but nevertheless I'd suggest you missed the forest for the trees. The profitability of a trading firm is directly linked to their ability to allocate capital in a way the market likes, and someone with great information thinks that hiring lots of smart people achieves their goals more effectively than hiring small numbers of smart people.
> Something is seriously twisted in its current state
100%, but it isn't the concentration of smart people in finance. That is a good thing - better more scheming bankers than lawyers.
Free market capitalism gives capitalists perfect freedom to operate in the sliver of the Venn diagram that connects what is possible with what customers will pay for. If they step outside that, they go bust.
If there is a problem is probably that the US government didn't let enough companies go bankrupt in the aftermath of the 2008 crisis, and the same idiots that were in charge then are still in charge, or their protegees.
Bit risky telling someone what their job is, but nevertheless I'd suggest you missed the forest for the trees. The profitability of a trading firm is directly linked to their ability to allocate capital in a way the market likes, and someone with great information thinks that hiring lots of smart people achieves their goals more effectively than hiring small numbers of smart people.
> Something is seriously twisted in its current state
100%, but it isn't the concentration of smart people in finance. That is a good thing - better more scheming bankers than lawyers.
Free market capitalism gives capitalists perfect freedom to operate in the sliver of the Venn diagram that connects what is possible with what customers will pay for. If they step outside that, they go bust.
If there is a problem is probably that the US government didn't let enough companies go bankrupt in the aftermath of the 2008 crisis, and the same idiots that were in charge then are still in charge, or their protegees.