Christmas in Wall Street - Eight Things I Wish for Wall Street, by Michael Lewis

<p>Who's been naughty, and who's been nice?</p>
 Photographer: Rob Kim/Getty Images

Who's been naughty, and who's been nice?   Photographer: Rob Kim/Getty Images

It's a wonderful life on Wall Street, yet here is a holiday wish list to make it even better.

1. The financial sector rids itself of anyone with even the faintest reason to believe that he or she is unusually clever.

All those who have scored highly on standardized tests, or been invited to join Mensa, or finished in the top quartile of any graduating class will be banned. Most of our recent financial calamities -- collateralized debt obligations, credit default swaps on subprime mortgage bonds, trading algorithms that prey on ordinary investors, the gaming of rating companies' models, the rigging of the Greek government's books so the country might disguise its true indebtedness -- required a great deal of ingenuity. Lesser minds would have been incapable of causing so much damage.

Of course, it's not easy to prevent clever people from working in finance, or from doing anything else they want to do. Perhaps now more than ever, clever people are habituated to being paid to ignore the spirit of any rule -- which is one reason they have become such a problem on Wall Street. Upon seeing a new rule they do not think, "What social purpose does this serve, and how can I help it to do the job?" They think, "How can I game it?" If it pays to disguise their intellects, clever people will do it better than anyone else. Without further regulation, our entire society would soon be operating in the spirit of the Philadelphia 76ers: Kids tanking the SAT, parents choosing high schools that guarantee failure, intellectual prodigies scheming to gain entry to Chico State. No single rule, by itself, is capable of protecting the rest of us from their intellects. We'll need more rules.

2. No person under the age of 35 will be allowed to work on Wall Street.

Upon leaving school, young people, no matter how persuasively dimwitted, will be required to earn their living in the so-called real economy. Any job will do: fracker, street performer, chief of marketing for a medical marijuana dispensary. If and when Americans turn 35, and still wish to work in finance, they will carry with them memories of ordinary market forces, and perhaps be grateful to our society for having created an industry that is not subjected to them. At the very least, they will know that some huge number of people -- their former fellow street performers, say -- will be seriously pissed off at them if they do risky things on Wall Street to undermine the real economy. No one wants a bunch of pissed-off street performers coming after them. To that end ...

3. Women will henceforth make all Wall Street trading decisions.

Men are more prone to financial risk-taking, and overconfidence, and so will be banned from even secondary roles on Wall Street trading desks -- though they will be permitted to do whatever damage they would like in their private investment accounts. Trading is a bit like pornography: Women may like it, but they don't like it nearly as much as men, and they certainly don't like it in ways that create difficulties for society. Put them in charge of all financial decision-making and the decisions will be more boring, but more sociable. Of course, this raises a practical question: How will our society find enough women older than 35, with no special intellectual ability, to fill all of Wall Street's trading jobs? Well ...

4. Wall Street will take the resources it once hurled at Harvard and Yale universities, to recruit their students, and invest in America's leading retirement communities, to recruit their swelling population of elderly women, most of whom are currently wasting valuable trading hours.

I think that we can all agree that a human being is never too old to trade. Many of these ladies would no doubt love a chance to engage in a bit of risk management. Wheel 'em in! After all, there was a time, not very long ago, when very old men were allowed to linger in their Wall Street jobs until carried out, feet first. These old guys were useful; they improved the moral tone of the place. If nothing else, they reminded the young people around them of their own mortality.


Print this post

Do you like this post?

Add your reaction to this article