Wednesday, November 25, 2015

Three Goldman Sachs Execs Leave for Uber

Three mid-level bankers in Goldman Sachs' technology investment banking group in San Francisco have left to take positions at Uber Technologies, reports Reuters.

Reuters notes:
A vice president in Wall Street investment banking can get paid $500,000, including bonus, while a mid-level corporate development employee at a technology company like Uber might earn closer to $200,000, recruiters said. The banker's salary will often fluctuate depending on how the deals and capital raising areas are doing in a particular year. Bankers may take pay cuts to move to Silicon Valley, but there is often the appeal of a better work-life balance and the opportunity to work at fast-growing private companies that can offer shares or stock options, and therefore the possibility of big IPO paydays for senior staff. Those gains can sometimes more than make up for the reduced salaries.
Bottom line: Wall Street banker-types go where the biggest payouts are. The payouts have been huge in the Silicon Corridor for those given attractive stock options packages.

This Silicon Corridor boom will continue---until the Fed slams on the money printing brakes.  And there is no indication the Fed is going to that any tine soon. A Fed rate hike of just 25 basis points is going to do nothing to stop the boom.

The idea that we are not in a new Fed manipulated boom is absurd. The idea that the Fed "has lost its power" to manipulate the boom-bust cycle makes even less sense.


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