It is in fact just a joke. New grads write shitty code (I certainly did when I started at Google) and after a few months of attentive reviews they write good clean code. It feels like hazing a bit at first because all us arrogant ivy league types graduate thinking we're geniuses and then it turns out, no, we can't even do the equivalent of fetching coffee correctly and have to be handheld through it. But afterwards people joke about it the way they joke about any other shared experience.