Let's are with one point that blankfein made, which i that was interesting.
One of the key questions that people have for wall street firms is can a rich -- can they attract and retain talent?
And as lloyd said, yes, 80% of the people who are applying to his firm and others, which is goldman.
Is that true?
I think he is spot on.
First of all, let me say, that is a very outstanding interview.
Very wide ranging.
I think we heard them kind of redefine a little bit and clarify the way they expect to do business, but also the way investment banks are doing business.
Overwhelmingly, young people still want to come to wall street.
It is kind of amazing that given the image that they have painted of wall street in the press, obviously and washington, d.c., in middle america, from what he indicated, i think he is absolutely spot on.
In our recruiting, he is spot on.
The desire to enter the investment banking field by young people, i do not see and doing.
We were recently looking for three and turns to one of our areas in the new yorker, had three schools in the northeast and had over 100 applicants for just three spots and very anxious top of the class type applicants.
So i think he is spot on.
Are you able to pay less, though, that you were a few years ago?
I think that generally speaking, compensation on wall street has come down.
The folks that have felt that the most are not the analysts and associates that enter the business.
The folks that have really felt that on the top line, the senior vp's, those are the folks we've seen the compensation compression.
On that -- in that area where you were seeing the new entrants, compensation has remained relatively static.
Pre-k's jim, one of the other things that struck me that blank blankfein said early on is we are dealing with a new situation, regulators want wall street firms to be safer, but he is so pressured to come as he said it, increase return, but decrease the risk.
It is very difficult to try to do both.
And you are now seeing this bifurcation of firms who can do that well and firms, like citi, who are not doing it well.
That was one of the point that out with striking about the interview, and also the part about legacy issues.
But to get back to the question that you just asked, it is fairly interesting because goldman sachs has always been sort of the gold standard in making that balance, striking a balance between risk and reward, and for whatever amount of risk, get the maximum gain from whatever that commodity is, whatever that trade is they're going after.
I think what i heard him to say is that we can really expect to see a different expert -- a different approach by goldman sachs, and we are seeing it.
The approach is as we are not going to go take huge positions in our fixed income book, but we are not going to take huge positions in a some prop trade because we think we can double or triple our money in four or five years because the risk of doing so, and the downside of doing so, might be something that we could have tolerated prior to 2008, 2009, but something that the ramifications of which we do not want to take right now.
The reality of what i am hearing them say as he redefined the, and as you can see what happens has happened in investment bank earnings, trichet betty, and stephanie kind of touched on it, is that those big trades, you know, those big transactions that used to fuel a goldman sachs where you would read about and hear about it are not as attractive as they used to be.
To get back to just a debt underwriting, equity underwriting, doing new issues, doing ipo's, taking moderate reasonable positions and seems to be what i thought and say -- saw him say you can excitedly from goldman sachs going forward.
Jim, hang on, we will talk more about the meeting between wall street and washington.
Coming up, house speaker john maynard gets a few laughs on late-night television when he
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