Morning Coffee: It's not easy being a father in finance. And it's the season for career breaks
Was Marty Chavez’s disappearance from Goldman Sachs an inevitability? Maybe so. Arguably, it was only a matter of time when David Solomon took over. It’s not very fair for a new CEO to have daily dealings with someone who was regarded by many as his alternative. Nonetheless, the departure seems amicable. Chavez will have a kind of emeritus “Senior Director” role, reassuring the “strats” that they still have a voice at the top, and potentially continuing to see his Marquee IT megaproject through to completion.
Taking the obvious factors as read, then, it’s worth noting that Chavez reportedly began planning his departure back in January on a whiteboard where he wrote “Operation Kids, Freedom & Sunshine.” For a man who once said “My top priority is peace of mind. No 2. is my kids. No. 3 was Goldman Sachs,” this is telling. It looks a lot like Chavez quit because working for Goldman didn’t conform with his aspirations as a father.
Chavez and his husband have two children (in a 2016 profile, there was one baby, so this is a very young family). Clearly he didn’t get to be CIO and CFO for a bank like Goldman Sachs without working incredibly hard, but as the demands of family life grow, it’s quite natural for someone with Chavez’ success to reassess whether the game is still worth it. (At lower levels, of course, fathers of young children all too often just have to suck it up).
Now that Chavez is leaving to raise his children whilst teaching a course at Stanford University on “how software ate finance,” it’s also notable that Marc Nachmann, the guy who’s replacing him as co-head of securities at Goldman seems more willing to be away from his family. The Financial Times reports that Nachmann has been living in London working for Goldman Sachs while his family lives in Florida. When he takes over from Chavez, Nachmann will move to New York. This will narrow the gap between he and his children to 1,000 miles, instead of the 3,500 miles that seem to have been in place since at least 2017 - unless, of course, his family move to be with him.
Nachmann’s family arrangements are clearly his own business, but are nonetheless worth noting in juxtaposition to Chavez. - If cultural expectations are set from the top, there could be a surprise in store for people in Goldman’s securities division who currently rate Goldman Sachs as their third priority in life. It’s also worth observing that Nachmann comes from the investment banking division (IBD) as opposed to securities, and that this is also David Solomon’s most recent background. IBD people famously work some of the longest hours in finance. As Chavez’ ethos fades, Goldman’s strats, traders and salespeople could be in for a shock.
Elsewhere, as the kids return to school and a new crop of graduates come in looking even younger than last year’s, it’s quite natural for bankers of a certain age to start thinking about the merits of taking a career break. Mark Burgess, EMEA CIO of Columbia Threadneedle, has done just that, after having delivered an extremely strong year’s performance which saw him awarded Investment Leader of the Year after completing a series of projects and getting promoted to Deputy CIO of the whole firm.
Of course, a decision like this has a long lead time – as well as the financial aspects, you want to be sure that you’re leaving on a high like Mr Burgess, in order to ensure you’ll be remembered well if you want to come back. And at senior levels, you need to be thinking about succession and who you can hand your responsibilities over to while you’re considering your priorities somewhere sunny. So if you think you might be hearing the call of the wild in summer 2020, start planning now.
A “banking ethics advisor” at the FICC Markets Standards Board was moonlighting as an expert witness in litigation against banks involved in the forex scandal. According to the FMSB, that’s a clear conflict of interest; according to him, he’s a whistleblower who was pressured to keep quiet. Now it’s in court. (Bloomberg)
Also in court – short sellers, chicken farmers and former FBI informants get carried away abusing each other on Twitter and it ends up in a $25m libel suit. (New York Post)
Can retail and service industry jobs be “middle class”? It depends what you mean by that really, they’re not going to be competing with banking any time soon, but a number of companies make their business work while paying “a salary where you can raise a family”. (Harvard Business Review)
To the intense frustration of their bankers, rich people are holding more and more cash, on which it’s hard to charge fees and even harder to pass on negative deposit rates. (FT)
Another case of someone being refused entry to the USA because the immigration officials took exception to WhatsApp messages they’d received from someone else. (Techcrunch)
The Apple Card – the one you’re not meant to keep in a leather wallet in case it stains the surface – is made of 90% titanium and 10% aluminium. (Bloomberg)
And one of the parents (not the banker) in the U.S. university admission bribery scandal has come out with guns blazing, claiming that the practice of taking donations in exchange for admissions is far too widespread and tacitly approved of to be regarded as a crime. (Bloomberg)
Photo by Kelly Sikkema on Unsplash