It wasn’t until late 2005 that Weird Wally (WW) gave much
thought to Wall Street. But when
President Bush announced his intention to privatize Social Security, WW sat up
and started paying attention. And from
what little he understood at the time, one thing was obvious: Bush’s idea of a
secure and happy retirement for all Americans was for us to each create a
private retirement account and send our money off to Wall Street.
Like many of us, in his minds’ eye, WW imagined cigar smoking
fat cats sitting in their offices figuring out which corporations were good
bets and which ones weren’t. And like
most the rest of us, his minds’ eye had it totally wrong. Instead of a noisy and chaotic stock exchange
floor with masters of the universe, studying charts and screaming into cells at
their minions on the floor to either buy or sell, we might now see small rooms
with tech folk and programmers working on secret coding and information infrastructures.
What Wall Street has been about for the past several years
has to do with complexity and speed. According
to Michael Lewis, in his recent book, “Flash Boys,” Wall Street is all about adding
layer upon layer of complexity
onto an already complex situation. And
upon each layer of complexity, there exists corporations and people whose only
job is to extract wealth, resources and energy from this complexity, without adding of
value in return; kind of like a disease.
But at the very bottom of this complexity are the tech guys
(mostly men), the guys who write the code and design the infrastructure along
which information travels at unbelievable speeds from one point to another. And although the speed of a blink of the eye
is considered slow in this fast paced world, billions of dollars have been
made over the information arriving faster than the blink of an eye, at one
place, before it arrives elsewhere.
These tech people at the bottom are often graduates of MIT,
Princeton or other high prestige universities.
People who might have otherwise gone into research and added something
of value to society, were instead drawn to Wall Street, where they hooked up
with MBAs from Harvard, and such, and are now both are making billions a year
without having to add value to anything but themselves. It’s much like a perfect marriage where a
brilliant techie meets up with a brilliant sociopath and they both go into
business.
