Reality Check

Career Opportunities & Internships Investment Banking
1

<p>I've held back posting on CC for a while now. I read the threads and all the questions and see just how ill informed people are. Don't get me wrong, there are some good posters here, but more then half are kids who saw American Psycho or heard that IB=$$ and decided they wanted to do it when in fact they couldn't tell the difference between an ECM and a DCM. I usually post over at wallstreetoasis (an ib board) but I'm bored as hell so I figured I'd throw up a thread with my wisest bits of wisdom. </p>

<p>1) Lets dispel any notion that being in IB is cool/hip/fun. You think you can work a 100 hour week? Awesome, now go out and do it. Now go out and do it for a month. Now two years. The "models and bottles" mantra doesn't apply because you don't have time for either when you're in the office from 7am-1am. </p>

<p>2) Don't do this for the $$ because, truth be told, if you can make tons of $$ doing IB then you can make tons of $$ doing something else. I've always believed that successful people are going to be successful no matter what they do. </p>

<p>3) The IB that YOU are going to be going into is very much different from the one that you've heard about. BS got bailed out, Lehman is filing for bankruptcy, and ML just sold itself to Bank of America. Many on the street are questioning whether MS and GS will survive without help and most, while reluctant to say so out loud, don't think they will survive without some help (which they'll get). </p>

<p>4) Learn what IB is before you decide you want to go into it, and learn how to get into it. To learn what it is I suggest you check out wallstreetoasis, read monkey business, and keep up with the WSJ. Now...how to get into it. </p>

<p>5) Assuming you don't have family connections you need to go to a good school. There's no "list" of targets. Go to a schools website and see who interviews on campus. Find out how many people from your school work in banks. If you want IB right out of college then you're going to want to go to a fantastic school....and no, schools that many think are <em>fantastic</em> are not actually fantastic when it comes to IB (ND, UCLA etc...not picking on these two I'm just throwing out two schools I'd considered to be excellent but, when it comes to IB, aren't flooding the street with employees). </p>

<p>6) You don't have to be an analyst out of college to get into IB. In my group I have 2 ex corporate lawyers and 1 guy from the peace corps. The lawyers obviously got in after their corporate law careers and the peace corps guy came from business school. </p>

<p>7) You either like this job or you don't...you have to decide not only if you can handle it but whether it's worth it to you. 300k may seem like a lot of $$ but after NYC taxes, rent, the lifestyle you get accustomed to, it's not as much as it sounds. </p>

<p>If you have any questions I'd be glad to answer them...at least for as long as I'm here :)</p>

<p>-2nd year associate, BB</p>

2

<p>is Columbia a "fantastic" school. I'm a senior trying to pick a school for ED and I'm starting to find that CU isn't as well represented compared to other schools like Dartmouth, UPenn, etc.</p>

3

<p>All the ivy's are fantastic schools. I'd rather be at princeton than Brown but it's not that big of a difference. Columbia/Dartmouth/Penn aren't going to make/break you. It's not like we're talking about Harvard/Southwest State here. </p>

<p>FWIW: A senior picking a school to apply for ED based on IB opportunities is one of the dumbest things I've ever heard. When you get into college you'll realize two things:</p>

<p>1) There's not as much sex as American pie would lead you to believe and</p>

<p>2) Almost everybody plans to do IB/Medicine...that is of course until they realize how hard it is to get and how many <em>hoops</em> one must jump through.</p>

4

<p>I'm actually not, but it's one of those minor factors.</p>

<p>I'm currently trying to decide between CU, Dartmouth, and PENN.</p>

<p>Anyways I'm curious about how you got into the whole banking racket. What motivated you to go for the industry?
Also how do you think the banking landscape will change once the beheading of Lehman and ML becomes official. Do you think the industry will ever recover to the bull market state it was in a couple of years ago?</p>

5

<p>"Anyways I'm curious about how you got into the whole banking racket. What motivated you to go for the industry?
Also how do you think the banking landscape will change once the beheading of Lehman and ML becomes official. Do you think the industry will ever recover to the bull market state it was in a couple of years ago?"</p>

<p>I got into it because I love the markets. While some people flip through the channels to find whatever sitcom is hot at the time I go right to CNBC. I was always reading the WSJ in college and the interest just grew. I got an analyst position out of college and was then invited back as an associate, which I took over a few PE/HF offers (one of which, as it turns out, would have been pretty lucrative...but that's life). </p>

<p>In regards to how everything will shake out I honestly don't know. Nobody does. If they tell you they do they're lying. I know a few things: 1) Everything has changed...I think GS/MS are eventually going to merge (with Wachovia most likely). 2) People are on edge, everybody. I work at a group that hasn't been hit too hard and even we're on edge. Just ask the Lehman guys who left work on Friday "on edge" and are now wondering if they even have to show up monday morning. </p>

<p>IB, as an industry, in my mind, won't recover to the bull market of a few years ago. The bull market was so good because there was such little regulation and oversight. Now, with big banks spearheading this nations economy into a lull, there's going to be a whole difference landscape when we come out of this (which I would expect to happen in ~2 years). That being said, no, I think the days of paying 22 yr olds 160,000 for a menial, simple job are over (and no, being an IB analyst takes no intelligence, just a will to work). </p>

<p>A little side note: watch Manhattan housing prices. With thousands of people out of work and unable to afford those pricey condos I'm expecting to see it come down a little. It'll be interesting.</p>

6

<p>Why is it that anything that drains your time away has the acronym "IB" lol :p</p>

7

<p>Come on, MonkeySee. There are a lot more important problems than IB to worry about.</p>

8

<p>^^^ Perhaps you could discuss them on boards that aren't dedicated to Investment Banking?</p>

9

<p>Come on, Bryce. There are a lot more important problems thank Sri Lanka to worry about.</p>

10

<p>Hey MonkeySee, good to have you on these boards. When you say IB, do you mean i-banking in general, or just IBD? I was under the impression that S&T was getting screwed and IBD less so. </p>

<p>That said, do you think a degree in Financial Engineering will be the best choice for breaking into banking (IBD or S&T, haven't decided) four years from now? I'm leaning towards no, but if you have any insight I'd like to hear it.</p>

<p>By the way, what group are you in?</p>

11

<p>^^ good question. FE is quant focused so I've been worried that people might get pigeon holed into quant focused jobs but the curriculum for it is definitely a good way to understand finance and the equations and modelling involved in it.
Hope you can answer this to too MS ^^</p>

12

<p>Anon, FE will not pigeonhole you into quant jobs. Search for posts by cryptography on the Columbia forums on this very topic. FE grads go into IBD just fine.</p>

<p>My question was pertaining more to the fact that CDS, CDO, ABS (I can't keep these things straight lol) and all those fancy derivative products played a large role in this crisis. They also happen to be a large part of what you'd learn in an FE program. And who knows what regulations on such products will be implemented? So given THAT, would FE still be a good major choice for banking?</p>

13

<p>"Hey MonkeySee, good to have you on these boards. When you say IB, do you mean i-banking in general, or just IBD? I was under the impression that S&T was getting screwed and IBD less so. </p>

<p>That said, do you think a degree in Financial Engineering will be the best choice for breaking into banking (IBD or S&T, haven't decided) four years from now? I'm leaning towards no, but if you have any insight I'd like to hear it.</p>

<p>By the way, what group are you in?"</p>

<p>You have to look at the bigger picture. Gone are the days of excess on wall street because, pretty soon, gone are the stand alone independent investment banks. Eventually GS and MS will merge with commercial banks and with that comes a dramatic increase in oversight and regulation. In terms of firings/layoffs this is just the beginning. </p>

<p>I think any degree that requires math and critical thinking is good. </p>

<p>I'm in technologies</p>

14

<p>would you say UVA's McIntire School of Commerce is considered a fantastic school?</p>

15

<p>Like I said it's not like there's a list of "fantastic" schools. That being said I'd argue that 'if you have to ask..."</p>

<p>Either way, with the way things are going now you 1) are not going to get IB no matter where you're coming from next year and 2) have to wonder whether or not you want it. </p>

<p>1) Banks like MS, GS are interviewing on campuses just to keep a presence...that is to say they don't want to "go away" and have their name fade out of recruiting but it's almost certain that they're not hiring anyone, even if you go to wharton/princeton/harvard. </p>

<p>2) You have to ask yourself i you want to work 110 hour weeks for 70k (don't expect bonuses next year) and a very real chance that you're going to lose your job. </p>

<p>In addition wall street isn't going to be the same. The days of young, affluent bankers are OVER. My plan was always to save up enough $$ to open up my own business... unfortunately I (and many others) got accustomed to a certain lifestyle and probably didn't save as much as we should have. We'll see what the future brings but you're witnessing history here. Wall street is never going to be the same.</p>

16

<p>Reading this thread ripped my dreams apart, lol.</p>

17

<p>lol, this thread is basically what all "pessimistic" people are saying. You dont have 50 years of wall street experience or anything. </p>

<p>Markets ALWAYS go up and down. You cant say "IB" is over, never be the same, and etc. This is just another opinion. Some people say the banking sector will be booming again in 2 years, some say 5 years, and 20 years. But its 100% sure it will go up again, and you state the obvious of IB not hiring currently, do you think they should hire more people to compensate for the losses?</p>

<p>anyways this is my OPINION.</p>

18

<p>"lol, this thread is basically what all "pessimistic" people are saying. You dont have 50 years of wall street experience or anything. </p>

<p>Markets ALWAYS go up and down. You cant say "IB" is over, never be the same, and etc. This is just another opinion. Some people say the banking sector will be booming again in 2 years, some say 5 years, and 20 years. But its 100% sure it will go up again, and you state the obvious of IB not hiring currently, do you think they should hire more people to compensate for the losses?</p>

<p>anyways this is my OPINION."</p>

<p>The difference between your opinion and mine is that I have experience on the street and my opinion happens to fall in line with others opinions who have had experience on the street. Someone said investment banking will be booming again in the future? Please, link me to that article. </p>

<p>You don't seem to understand the difference between the economy and IB. They are not the same. One will go up again (economy) one will not (IB). The reason IB was so successful is that they weren't regulated, they could do as they wanted and bend the rules. Well, no more my friend. Not after they're all swallowed up by commercial banks.</p>

19

<p>As you pointed out "One will go up again (economy) one will not (IB)" thats not the case right now. Economy and IB are doing pretty bad right now.</p>

<p>What do you mean by "regulation," commercial banks dont regulate, I do not understand where you are going with "regulation." </p>

<p>You cant say that IB were "rich" just because of weak government regulation.</p>

<p>Your experience is like 5 years??? And you are in line with others, it seems like you took their opinion lol</p>

20

<p>CCVIA I mean this as an honest question, with no offense, but do you even know how IB's work? Investment Banking was lucrative because of the risks it took, risks that it wont (nor will it be allowed to) take. If an independent IB merges with a commercial bank it's not going to be allowed to take as many risks because the commercial bank can't afford to get hurt on those risks. Furthermore the government is going to impose more regulations on what you can and cannot do which will further hinder possible big gains. </p>

<p>I love your last comment too. So I guess a PHD student in astronomy who says astrology is BS is just "following the crowd" too huh? When everybody on wall street says the high days of IB are over I'd tend to believe them. That is unless you have experience on the street which begs the question, how much experience do you have? Do you honestly, a college student (I assume), think you know more about the future of high finance than people who have spent hundreds of thousands of hours doing it? In arguing certain points you appear to be in over your head.</p>

<p>EDIT: I checked your profile and you're a HS student? Wow, I can't believe I'm having this debate with you. Go ahead believing what you want and when you decide to face the facts you can remember that I was right. I remember when I knew it all too, it was fun, but then I grew up and found out that when you don't have a damn clue of what you're talking about you should probably just keep your mouth shut. I'd be happy to give advice and insights but I, a 4 year vet on the street who's on his way to a top biz school, am not going to argue with a HS kid when it comes to what I've been doing the past 4 years.</p>