<p>What a retarded statement. I guess all the people with Harvard degrees are lining up right now to swap theirs with degrees from State U.</p>
<p>^^^^</p>
<p>bobbytheb: I wasn't aware degree-swapping was possible. I think you missed the point of the article and instead focused on the headline.</p>
<p>we're only at college because we haev nothing better to do...
if we did, we'd drop out</p>
<p>most of the successful people running this world dropped out</p>
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<p>You're confusing the Big Ten with the Pac-10. The Big Ten conference has 11 schools (Penn State joined in early '90s), the Pac-10 has 10 schools. ;)</p>
<p>NYT had an article recently of the young 20-something crowd that are millionaires already, or 100 millionaires. One of the schools they graduated from is UIUC.
Things have not changed that much from the 70s. A degree can only carry you so far. At every step on your way up, you have to prove yourselfs all over again.</p>
<p>^^^
"prove yourselfs..." :)</p>
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The founders of the largest tech company (Google) went to Michigan and Maryland
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<p>Yeah, but more importantly, they met each other and then got the idea for the company from their grad school (Stanford). The first iteration of Google was a Stanford research project that was handed to them by one of their advisors. If they had never gone to Stanford, they wouldn't be be billionaires right now.</p>
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Some people, have to pay full tuition + room/board and If I were to go to the best school I could, I would end up with over 130,000 of debt.
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<p>On the other hand, some people actually find the best schools to be cheaper. I know 2 guys who got into both their flagship state school and Harvard, and actually found out that Harvard would be cheaper than the state school, once financial aid was factored in (as these guys came from relatively poor backgrounds). I will always remember one of those guys remarking acidly that as a kid he had always dreamed of attending his flagship state school, but since he couldn't afford it, he had "no choice" but to go to Harvard. He had a wickedly dark sense of humor. </p>
<p>The point is, we can't generalize that the best schools are always the more expensive schools for everyone. For some people, the best schools are actually the cheaper schools.</p>
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FT.com / In depth - One hedge fund in 10 to go bust, says Man
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<p>Barrons, nobody is saying that the hedge funds are going to ride out unscathed. Of course there are going to be many hedge funds that go bust! In fact, I would be deeply surprised to find out if that didn't happen. Similarly there are going to be plenty of regular companies that go bust if the credit turmoil persists and/or we enter a recession.</p>
<p>But, I (and the_prestige) have said it before, that's not really the point. What matters is not the performance of the hedge funds themselves. What matters is the (financial) performance of the hedge fund employees. Hedge fund employees can and do get paid very very well even if the funds themselves do not perform well. Furthermore, even if the fund does so poorly that it collapses, the principals can often times just start another one. For example, John Meriwether's LTCM fund collapsed so specularly as to threaten the integrity of the world's financial markets. Yet that apparently didn't matter, as he was soon afterwards able to start another billion-dollar fund anyway. </p>
<p>The salient point is that the hedge fund industry is one in which it is fairly easy to make a lot of money once you've gotten in, and where poor performance is never really punished. It shouldn't work, but it does work, and hence I am not surprised to find people who want to get in to make a lot of easy money. The trick, of course, is actually getting in. Many people rightfully view Ivy League degrees (and degrees from other top schools) as tools to help them get into the hedge fund industry and similar industries.</p>
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Hedge fund employees can and do get paid very very well even if the funds themselves do not perform well.
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<p>Sure, from the exorbinant management fees they charge their wealthy clients.</p>
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Sure, from the exorbinant management fees they charge their wealthy clients.
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<p>Exactly right. Exactly right! </p>
<p>That's my point exactly. There is easy money to be made. Hence, it is not surprising that people want to get in in order to make it. Again, the catch is that you have to get in. </p>
<p>I personally don't understand why investors don't simply demand that hedge funds lower their management fees so that you don't have hedge fund employees soaking up huge pay packets from the management fees despite the funds themselves providing mediocre performance. Right now, those employees are laughing all the way to the bank on their way to breaking the bank. But hey, what can I say? Nobody asked me. It's not my fault that those investors are offering easy money to the hedge fund employees. As long as easy money is available to be made, then people are going to want to make it.</p>
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I personally don't understand why investors don't simply demand that hedge funds lower their management fees so that you don't have hedge fund employees soaking up huge pay packets from the management fees despite the funds themselves providing mediocre performance.
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<p>Though this isn't 100% of the reason, I believe its at least part of it: the Veblen good effect (snob effect).</p>
<p>Individual investors in hedge funds are termed "high net worth" (HNW) individuals -- i.e. generally extremely wealthy if not super wealthy (these investments generally will not make or break these people). Often times there are minimum individual investment lots of not less than a cool $1 million per investor (not to mention minimum net worth requirements). These investors consume products / services differently than your normal consumer. Often times when a product / service is seen as "discounted" they perceive that the quality is somehow inferior... that in order to "get the best, you have to pay the best" --> that the best hedge fund managers will charge the highest for their services, or conversely, inferior mangers are forced to cut their fees. Also, the "snob effect" at play is simply that many of them like the fact that these high minimum requirements and high fees keep hedge funds out of reach of your normal investor... if Maybach started offering their product to the lower income segment via a low budget car, its "luxury" / "snob" appeal would take a hit.</p>
<p>Basically, I'd say that for many of these investors, the high management fees are not really an issue, they want to be "in the know", they want to keep up with the Joneses -- whether that's a summer home at Martha's Vineyard or comparing notes regarding their hedge fund investments.</p>
<p>The real big money in hedge funds and any other major investment form comes from institutions (endowments, pension funds etc.) and now offshore governments. They are less concerned with being in the know and very concerned with outcomes. The brief term of outlandish fees will soon be over as the bloom is coming off the rose and competition for the $$$$ is increasing meaning lower fees. All markets return to sanity pretty quickly.</p>
<p>^ agreed...the party's coming to an end.</p>
<p>some yeoman's work being done in this thread by sakky and the_vestige :)</p>
<p>My first reaction upon seeing the highlights of the article was to respond with something sarcastic along the lines of, "Sure, and coincidentally, most PEOPLE didn't go to an ivy league school." The fact that Stanford tops that list should be surprising to nobody.</p>
<p>And yeah, the lists of richest americans tends to contain a bunch of people who started their own tech firms. that's great. if we're comparing ourselves and our careers to those who made billions in their 20s and early 30s, we're sure going to find a lot of lessons that are applicable to us. yup, i see nothing wrong with that.</p>
<p>It's like Larry Ellison addressing a B-school graduation by saying "congratulations, now that you have an MBA, you will never be as rich as me!". Okay, Larry, but if the goal isn't to be as rich as you, but instead to maximize our chances of being merely rich, rather than owning-a-megayacht rich, a top MBA seems like a good call, no? Pretty low-risk there, wouldn't you say?</p>
<p>They never tell you about the legions of people who try startup companies, fail, live in their mom's basements through their 20s, and wonder why they have trouble getting a real job again in industry once the responsibilities of adult life catch up to them. I live with a guy, right now, in manhattan, who's started his own tech firm. He bartends on the weekends - enormously lucratively, i should add - and makes enough to cover living expenses, the expenses of one full-time employee and another part-time one, while keeping business hours free for him to make presentations and attend VC events. The man's 24 and has a dream but is putting himself in a position to succeed - and if it doesn't pan out, he'll probably take a sales job in finance one of these years if he has to. But even he knows that the odds of his business taking off and making himself rich are about 10%. Those are odds he's prepared to face. But the average MBA has much better odds, even if he'll never make $100M on an IPO.</p>
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But even he knows that the odds of his business taking off and making himself rich are about 10%.
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<p>depending on one's definition of "rich" -- even 10% is a very optimistic number -- its more like less than 1%.</p>
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The real big money in hedge funds and any other major investment form comes from institutions (endowments, pension funds etc.) and now offshore governments. They are less concerned with being in the know and very concerned with outcomes. The brief term of outlandish fees will soon be over as the bloom is coming off the rose and competition for the $$$$ is increasing meaning lower fees. All markets return to sanity pretty quickly.
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<p>Absolutely disagree. If we agree that the alternative investment class is here to stay (for institutional investors) then the volatility in the market would suggest that the fee structure for the most successful / well known managers will remain. There will be a "flight to quality" -- and in such an event, the elite hedge fund managers will be in demand more than ever. This coupled with the fact that we are now inundated with a huge number of funds would only strengthen this thesis.</p>
<p>There is the saying that "no one ever gets fired for buying IBM". Well, if you are managing a pension fund or an endowment, are you going to stick your neck out and put your money with an untested hedge fund manger who is offering the K-Mart blue light special... or are you going to go with the hedge fund manager with the best track record? And you can bet that the best hedge fund managers will be in demand now more than ever. Simple supply and demand. Why would they cut their fees now?</p>
<p>"Most of the companies you speak of are ran by CEOs that graduated in the 70s, when college admissions and 'which college you went to' didn't matter as much."</p>
<p>That's news to me. (graduated in the 70s)</p>
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[quote]
It's like Larry Ellison addressing a B-school graduation by saying "congratulations, now that you have an MBA, you will never be as rich as me!". Okay, Larry, but if the goal isn't to be as rich as you, but instead to maximize our chances of being merely rich, rather than owning-a-megayacht rich, a top MBA seems like a good call, no? Pretty low-risk there, wouldn't you say?</p>
<p>They never tell you about the legions of people who try startup companies, fail, live in their mom's basements through their 20s, and wonder why they have trouble getting a real job again in industry once the responsibilities of adult life catch up to them. I live with a guy, right now, in manhattan, who's started his own tech firm. He bartends on the weekends - enormously lucratively, i should add - and makes enough to cover living expenses, the expenses of one full-time employee and another part-time one, while keeping business hours free for him to make presentations and attend VC events. The man's 24 and has a dream but is putting himself in a position to succeed - and if it doesn't pan out, he'll probably take a sales job in finance one of these years if he has to. But even he knows that the odds of his business taking off and making himself rich are about 10%. Those are odds he's prepared to face. But the average MBA has much better odds, even if he'll never make $100M on an IPO.
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<p>Yeah, it's all about being rich. That's what it all boils down to. </p>
<p>It shouldn't be surprising that Stanford, Berkeley, and MIT top the list of CEO's and where they earned their degrees, since the Valley is tech-centric.</p>
<p>While it's clear that all folks who want to be successful CEO's must have a basic modicum of smarts and so they will be heavily represented in the top 30-40 schools in the nation public or private, what the study really shows is that the prestige factor of where one went to school is largely irrelevant at least in Silicon Valley, particularly where one went to undergrad.</p>
<p>The finance industry, however, is much more clubby as a rule, and that is an implied point of this article (which is outlining an industry in a region which is apparently much less clubby).</p>
<p>If you live on the East Coast, you are largely unaware (usually, in my experience) that there are parts of the country that pay a lot less attention to the Ivy League. Actually, it could just be the "Ivy League" is different here -- in the Bay Area, Stanford, Berkeley, UCSF are schools that are beholdin' to no others -- but in general there is more of a meritocracy.</p>
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[quote]
On the other hand, some people actually find the best schools to be cheaper. I know 2 guys who got into both their flagship state school and Harvard, and actually found out that Harvard would be cheaper than the state school, once financial aid was factored in (as these guys came from relatively poor backgrounds). I will always remember one of those guys remarking acidly that as a kid he had always dreamed of attending his flagship state school, but since he couldn't afford it, he had "no choice" but to go to Harvard. He had a wickedly dark sense of humor.
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<p>Those things are rather isolated cases. Let's be honest, Harvard and the like would be more expensive than State Us, in general.</p>