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Morning Coffee: How to relate to your children when your job consumes your life. JPMorgan is as fussy as Goldman Sachs

If anyone in finance has a good relationship with their children, it's surely Carl Icahn. The 83-year-old New York hedge fund manager declared at the weekend that he's ready to give his 40-year-old son, Brett, a "piece of the action," and that Brett is the person who will probably replace him at the helm of Icahn Enterprises when he finally retires.

Blatant nepotism aside, Brett's ascension to the top job after 15 years working for his father and the kind of 'three year hiatus' that would relegate most finance careers to perpetual 'consulting' or the back office is testimony to the close relationship between father and son. Carl says Brett is the best candidate to fill the job. Brett modestly says he won't be able to fill 'Carl's shoes,' but will try. There's a rapport there. 

Brett's admiration for and willingness to be led by his dad comes despite the fact that, in the words of the Wall Street Journal, Carl spent Brett's entire childhood 'glued to his work.' When Brett was born in 1979, Carl was nailing his first victory as an activist investor after taking control of Tappan Company though a proxy vote. Brett's formative years were then spent on Carl's hostile raids for things like Trans World Airlines (successful) and U.S. Steel (not successful). Carl's parenting is unlikely to have involved hands-on after-school sports or daily interactions at the dinner table.

However, the relationship seems to have flourished just the same and the WSJ identifies two things that helped it along: chess and walks in the park. At the weekend, Carl would take Brett to Central Park or to the trails in Bedford and lecture his young son on investment theory and other topics. While some children might have rebelled, Brett was 'like a sponge.' When Brett became a teenager, Carl played chess with him on Sunday evenings and was consistently trounced by his offspring, who was subsequently found out to be devoting large amounts of time to professional chess coaching. 

Icahn only has one son, so his close relationship with Brett is uncomplicated by sibling rivalry. His daughter, Michelle, has worked for him too as well as pursuing a career as a school teacher. Michelle's husband works for Icahn too.

How, then, has Icahn - a man who once said, "If the price is right, we are going to sell. I think that’s true of everything you have, except maybe your kids and possibly your wife,” achieved such a close relationship with his offspring? 

Money clearly helps. When your father is worth nearly $18bn it doesn't take much to see where the path of least resistance in life lies. Brett's chess games with Icahn earned him $20k in wagers, which should be enough to make the most recalicitrant teenager interested in technique. Icahn does also seem to have had a parenting strategy, though, articulated previously as: don't spoil your kids, make them work for their money, and spend quality time with them walking in the outdoors.

Some might argue that giving your son $3bn to manage aged 33 is possibily spoiling him a little bit, but Carl would undoubtedly argue that Brett had already proved his ability and has continued to do so with investments in things like Netflix. Even now, Carl isn't exactly handing Brett the reins of Icahn entreprises - the two men have reportedly spent three years negotiating a '90 page contract' on how to proceed from here. Keep your children close, but also keep their parameters clearly and legally defined...

Separately, JPMorgan has got itself a new head of UK M&A in the form of Celia Murray from Goldman Sachs. Goldman Sachs has a reputation for making very, very careful choices about who it hires, but JPMorgan seems to have been equally deliberate in its choice of Murray. - Financial News notes that her new role was vacant at JPM since January. 


Chris Rokos has now taken full control of Rokos Capital Management after merging the portfolios previously run by individual traders into a single pool of money effectively run by himself. (Bloomberg) 

Wild parties and minor acts of vandalism at Woodford Investment Management. After the inaugural party, a senior employee, still heavily intoxicated, was seen driving his car around the car park at 4am. The police arrested Grant Wentzel, Woodford’s head of trading, who had been behind the wheel. (Financial Times)

Upset for bankers talking up the 'deal pipeline' as Saudi Aramaco delays its offer again (hopefully just by a few weeks). (Bloomberg) 

Bankruptcy for the RBS trading MD who tried to mitigate tax by investing in films. (Bloomberg)

When have an affair with your junior and the need for extra cash makes you susceptible to being bribed. “We were both married at the time and it was difficult to see each other unless we were traveling. I wanted that relationship to continue. I wanted to leave Credit Suisse. I wanted to establish a deeper relationship with Ms. Subeva.” (Bloomberg) 

Facebook's head of artificial intelligence, Yann LeCun, says the future for machine learning is all about 'energy based learning' where machines train themselves and compatibility between a prediction and reality is 'an energy level.' Lower energy is more accurate, so a neural net tries to reach an ideal low-energy state. (Zdnet) 

The horror of family life in Germany where there is “no script for being either a good-enough mother or a good-enough father”. “What I observe is that the mother works hard at her career, has a child, gets stressed trying to be a perfect mother, then tries to recruit her partner to be a perfect father, and the battles over parenting just escalate.”  (Financial Times)  

French bankers in London are buying post-Brexit boltholes in Paris. (Financial Times)

FX traders in London and New York were made to work Sunday to take advantage of Brexit-currency fluctations. (Financial Times) 

Lazard bankers in Paris were summoned to the office on Sunday night to learn that their star dealmaker and longstanding chief, 51 year-old Matthieu Pigasse, was leaving. Many 'expressed relief that the uncertainty hanging over them had been ended.'  (Financial Times) 

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AUTHORSarah Butcher Global Editor
  • An
    Andy Doddington
    21 October 2019

    "Icahn only has one son, so his close relationship with Brett is uncomplicated by sibling rivalry. His daughter, Michelle, has worked for him too as well as pursuing a career as a school teacher. Michelle's husband works for Icahn too." Excuse me, what century are we in?

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