“Croutons Wall Street”

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Croutons Wall Street Posted: 14 Jan 2011 05:24 PM PST By Dante Ramos More people on Wall Street should do what Brown graduate Lawrence Hester did. A story in this morning's Globe featured Hester, a 27-year-old who left a six-figure job in the financial-services industry to pursue his interest in gourmet croutons. According to the story, he's one of a number of local twentysomethings who are blowing off the white-collar rat race to start their own food-related businesses. Hester's reasoning was simple: After three years at his old job, he "wasn't excited to go into work anymore." Especially when unemployment is high, it's easy to mock someone's decision to quit a lucrative job for the purpose of self-actualization. Some online commenters certainly did: I'm sorry......not a good move. Call me sour, jealous, negative etc...hope it works for him, but at 27 most people don't have jobs that "excite them", or 6-figure salaries. It's called paying your dues, figuring it out. Hard to feel inspired by that story. Immediate gratification, wander-lust, idealism....not good reasons to start making croutons. In fact, the world may be better off if some of Hester's former colleagues followed his lead. The 2008 meltdown notwithstanding, employment in the US financial-services sector has grown enormously in the last three decades. And while the industry serves the important purpose of moving money from people who have it to people who can put it to productive use, there's a growing body of evidence that much of what that industry does is actively harmful to society — as investment houses develop innovations that make financial markets less efficient and transparent. This New Yorker article is essential reading on the subject. At one point, writer John Cassidy cites a British regulator who puts the case against the banks quite succinctly: Lord Adair Turner, the chairman of Britain's top financial watchdog, the Financial Services Authority, has described much of what happens on Wall Street and in other financial centers as "socially useless activity" — a comment that suggests it could be eliminated without doing any damage to the economy. In a recent article titled "What Do Banks Do?," which appeared in a collection of essays devoted to the future of finance, Turner pointed out that although certain financial activities were genuinely valuable, others generated revenues and profits without delivering anything of real worth — payments that economists refer to as rents. Accusations of rent-seeking are often leveled against, say, bloated public-employee contracts and bribe-taking politicians. And rightly so. But rent-seeking is also part of the reason financial-services firms can attract the brightest college graduates — and sustain six-figure salaries for 24-year-olds who, like Hester, don't really want to be there in the first place. The Globe story doesn't say precisely what Hester's old job was. But there's more benefit to society in a single package of Hester's Monterey Jack jalapeño cornbread croutons than in billions of dollars' worth of synthetic subprime CDOs. This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php Five Filters featured site: So, Why is Wikileaks a Good Thing Again?.

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