Morning Coffee: The tattoo-sleeved maverick moving to the top at Goldman Sachs. Drive a minivan, become a hedge fund billionaire
Is Goldman Sachs really a technology company? Maybe not, but the elevation of R. Martin Chavez, its current chief information officer, to chief financial officer is a big statement about the future of the bank.
Gary Cohn, who is now on his way to Trump's administration, famously headhunted ‘Marty’ Chavez back to Goldman Sachs after a three-year absence by saying "I was just calling to share with you that you're coming back." Now, Chavez is likely to be named CFO as the bank reshuffles the senior ranks. Cohn's role is set to be split between current CFO Harvey Schwartz (“very high EQ”) and co-head of investment banking David Solomon (“a hard-charging guy”), according to the WSJ.
Chavez now leads both tech and the team of quants and mathematical wizards in Goldman Sachs’ strats group and has therefore been growing in influence. This is a combined 9,000 of Goldman’s 34,000 or so people. He has his own PR division and has been leading the fastest growing divisions at Goldman Sachs. He also previously headed up Goldman’s equities business so is not a complete outsider choice.
The Goldman Sachs-type - bald, heavy-set, raspy-voiced, according to the FT - doesn't exactly describe Chavez. He's an innovator who has transformed technology at Goldman and his tattoo-sleeves imply a rebel tendency that doesn't fit entirely comfortably in the corporate Goldman culture. Still, if and when CEO Lloyd Blankfein steps down, Chavez is now in a better position to eventually position himself for the top job. Then, perhaps, the bank can justifiably describe itself as a tech company.
Separately, if you want to gain the trust of investors and make a fortune as a hedge fund manager, don’t be crass about it. Sportscar driving hedge fund managers possess a trait called “sensation seeking” and are much more likely to “terminate their funds, engage in fraudulent behavior, load up on non-index stocks, exhibit lower R-squareds with respect to systematic factors, and succumb to overconfidence,” according to new academic research cited on Bloomberg.
How can you tell a good hedge fund manager? They drive a minivan.
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