Global Crisis Blog

“Wall Street Recruiters Trawl Online Poker Circles for Talent”

or

Why We Should Lose Sleep

By Shlomo Maital

Nov. 22/2009

   

    Do you lose sleep, like me,  because America will pay, in 2015,  some $533 b. in interest on its public debt, debt equal to an entire year’s worth of GDP ($15,000 b.), where the interest alone will consume a third of all federal income taxes paid that year?  

    Do you lose sleep because, like me, you believe America is endangering the global economy because its currency, the dollar, has been dangerously overprinted and its impending collapse undermines  global capital markets?

     Do you lose sleep, like me,  because while political leaders and central bankers declare the global recession over,  global managers see no sign that ordinary people are spending more or that business are investing more, and a significant minority fear another recession soon? 

     If that is not enough, here is another reason to lose sleep.   The title headline is genuine, though it appears to come from Comedy Central, or MAD magazine.  It is from the International Herald Tribune, taken from Mason Levinson’s piece for Booomberg News. 

    Here is the gist of Levinson’s report:   “an increasing number of hedge funds and brokerage firms are scrutinizing professional poker to find talent and analytical tools.”  Levinson reports that a recruiter got a request from a hedge fund for online poker players with “no financial experience”, after the World Series of Poker in Las Vegas four months ago. 

    Let me get this straight.  It is widely agreed that a core cause of the global crisis 2007-9 was the utter breakdown in risk management models of banks and investment funds.   So, the solution is to recruit poker players?  The people who bluff, conceal, and deceive, who bet the whole pot on a single card?

       Global capital markets are apparently being rebuilt as enormous poker games with daily pots of $3.2 trillion (two-thirds of that derivatives).   Some of the better players, like Goldman, Sachs are profiting enormously.  In the past 90 days (the 3rd Quarter, July – Sept.), Goldman Sachs made $100 m. or more on each of 36 days from trading profits alone.  Why would they not want to return to the Great Global Poker Game? 

        Let’s see if we can figure out an optimal way for the financial services industry to build back the public’s trust.   How about, say, hiring a thousand star poker players?  Yes — that will do it.  That will certainly make ordinary people put their money back in banks and keep it there.