GS : Goldman Sachs or Greg Smith

When whole world is talking about the spectacular exit of Greg Smith,  an executive of one of the world's largest investment banks Goldman Sachs; I cannot but write something on this to satisfy myself. So here's the journey of the "GOLD" man's tale.... (Original Article :http://www.nytimes.com/2012/03/14/opinion/why-i-am-leaving-goldman-sachs.html)

As a newbie or rather a freshie into the walls of IIT, we would hear names of McKinsey, Morgan Stanley, Goldman Sachs more than traditionally expected Google, Microsoft, Sony. Fat pay packages, recruiting best of students and promise of a bright future; this wonderland combination is truly hard to ignore. Secretly quite many times I considered working there ( I mean try !! ).

Did I know what these banks do? I had no clue. This quest was answered by " The Inside Job", an Oscar winning 2010 Documentary film that I hit upon. True to the award, this movie is a wonderful watch summing up on the 2008 Global ( or to be precise American) economic crisis. The way GS and other banks played with customer confidence, betting against what they were selling as safe, was to me shocking and disgusting. What went wrong?? What is the problem??? Here I try my hands on.....

1) Bonus :-

Having been to classes of Organisational Behavior, I chanced upon what motivates workers, what brings in new talent to the organisation of which "Bonuses" are a part. But with this younger generation in pursuit of money ( yet movies show Happiness) are excited and motivated by bonuses. With this culture becoming the norm from deep pocketed finance companies to start ups that come to recruit interns, it is not hard to imagine the change that happens in work culture.

Bonus depend on your performance for a certain period of time. The better you perform the more you get. Bonus is technology companies where things can be tested immediately is fine but what about financial sector where nothing is for certain, where fortunes melt in minutes ( $2.2 Bn loss for GS due to GS - Greg Smith). The employees looking for short term profits which are judged by number of contracts or financial instruments they sell, amount being made by the company etc are the weighing factors for Bonus. GS was clear to this point by qouting the words "axes" and "muppets" in the open resignation  letter. This is exactly what happened during 2008 crisis, now with the GS episode and what is happening with Wall Street all along. This culture of bonus is to be questioned

2) Stock Market :-

I needn't give any info about it, being one of the best ways of earning fortunes ( atleast that's what we hear). It is a wonderful place where companies can raise funds and achieve their goals, earn profits with the generated capital. But with the advent of technology like high-frequency trading, financial innovations like derivatives, speculative futures; more and more people are fighting over short term profits. Companies are not safe from this. They have got to show good Q1, Q2, Q3, Q4 results, each year otherwise their share price crashes, competitors win. This vicious quest is making people forget the long term strategies, commitments and responsibilities

55% of households in US hold stocks where as it is 11% in Japan and 7% in Germany. This shows how dependent US economy is on volatile stock markets. A small bubble, an insider trading, a cheating case, a copyright infringement, the whole economy crashes. You can understand why India with just around 5-10% has stood strong though Sensex crashed. We are not dependent on this casino ( :P ) playground. This economic model is to be questioned.

3) Money:-

Few of you might have observed that my above two start with money, profits. So it becomes necessary to question this also. Pursuit of Money or Material wealth doesn't necessarily lead you to path of happiness. But this world is blessed to assume so. The economics we so cherish, with dreams all becoming the American dream, the great stress and importance given to material  things which all boil down to money should be looked upon carefully. Even Michael Douglas retracted by saying "Greed is Bad" from "Greed is Good", valuing family relationships over money and profits.

I am doing a lot of injustice by limiting the article to these few points, but then I am not qualified enough to state more than what I could comprehend as salesmen do. I with this article would request you to think about what is said here. Critically review, comment, discuss and help me and you get a good picture of where we are heading. 

Question, Reason, Think, Review...............and ACT

With love,

Vishnu.

College Life...........

There wouldn't be an end to discussions that one has on their experiences and memories of LIFE @ IIT. Or to be more general their college life. It is celebrated, cherished by all and for ages. What sets it apart from this long journey of life, it its distinctiveness. 

It is distinct because of its rich social life. It is distinct because of our friends and teachers. It is distinct because of the joyful and fun situations that we have been and that we chose to be. And finally it is distinct because hardly people have that kind of charm in them later.

People who know that I am still in college, would wonder why he is describing this as something long lost. Well I agree with them, but what I am trying to, is to raise few important questions that might find some meaning here..... Life @ IIT. I prefer to call it a true social life. Why? We play, we dance, we party, we sing, we study, we act, we beat, we get beaten, we watch, we listen, we fight, we facebook, we gmail, we tease, we cry. we laugh...all facets of life packed into this small period of life.

And what is even more special with IIT is the opportunities that it provides to grow. Pick your interest, there is a group already working towards it and if not there people willing to join you. Say you wanna break a record, there will be hundreds supporting and participating. Call for a protest, there are thousands ready to march, shout and stand for hours together. Share your idea, there will be scores of peers, professors willing to guide you. Life here is heaven until you realise or miss it.

Why all the charm and liveliness goes behind the curtain once you step out of this world? Why the pursuit of happiness after college life is so unhappy? Why people become so pressured, depressed and life so challenging that people loose all the solace? Why people become so self centered? My description of college life given above might be too juicy for some. But,

Life here has its own dark times. We have quizzes, project submissions, presentations, interviews, intern's. It isn't that we don't have competition here. We have one of the best minds in country competing. The difference is that here, there are people who are supporting you, willing to give a helping hand, ready to share and care. Why is it absent outside? We do have a great share of sad times, we get scolded by parents, GF's, we get rejected by girls(boys), professors, staff. But then it isn't same outside, as we have people(actually loads) willing to guide us and help us out. 

Few might shout, "You do not have responsibility!!". I disagree. We have as much responsibility as anyone can. We have to study, we have to get good interns, we need to get fat pay packages, we need to care our friends, family and maintain relationships. All these might sound silly, but how different are they from what we all do later. We take care of children, we maintain relationships, we work to get good salary, we take care of family, friends. What I am pointing to is the difference in approach and conditions that surroundings provide.

These observations point out to the fact that we essentially loose our social life as I describe it above, when we go out in to the so called "real world". As if it isn't so now. Many people end up being self-centered, loosing friends, not knowing neighbors, always looking in terms of  'I, my, me, mine'. If it is that all those that trouble us in "real world" don't trouble us in college life. They do. We too are at times self-centered, at times competitive but then these are not the guiding principles. We live here in a dynamic balance of private and social life, a balance in competition and co-operation, a balance in love and hate.

This dynamism and balance is absent outside, its too one-sided. Where does the fault lie? I feel it is in social structures, the behavior that people develop and  that "cities" groom. This isn't the case in places rich in social life, like villages, IIT's etc. One should question, reason out if technology and the modern model of capitalist development are the causes. Their stress on individualism, competition, efficiency and standardization, I feel is the cause....

This is the aim of my article, to point out to the ills of the so called modern yet self-destructing society. Question, Reason, Argue, Discuss........and ACT

With love,

Vishnu Vardhan