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Morning Coffee: Humble JPMorgan VP’s side hustle outclassed by Jamie Dimon. Another hedge fund guy opts for Barclays

“Vice-President” is an odd title, when you come to think about it.  In American politics, it means that you’re one heartbeat away from the most powerful job in the world.  In most corporations it’s a very senior post, only a step or two from the C-Suite.  But in investment banking, it basically means “someone who got through the analyst program without disgracing themselves and showed at least a little bit of potential as an associate”.  The VP title might sound grander than “managing director,” but it really isn’t.

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So when someone like Ed McGuinness, currently employed in credit research at JPMorgan, decides to try to swap the V for an M, by standing as a Member of Parliament in the coming British election, they’re going up in the world.  If someone on your desk has founded and runs an organization called something like “Conservatives In The City” in their spare time, they are also probably planning political elevation.

Ed has been selected for the Surrey Heath constituency, which ought to be a very safe seat.  He says he's "utterly humbled" by this, but has a very strong political CV – as well as the think tank side-hustle and banking career, he was an officer in the British Army for five years. Depending on the result of the election, he might rise to high prominence pretty quickly, and if he does the upper levels of British society are decked out with lots of funny titles that are even harder to parse than “Vice President”.  Is it better to be Lord Privy Seal, or Steward of the Chiltern Hundreds?

But even if he does get a heavy medieval title, Ed McGuinness might find he’s been beaten to it by his current chief executive.  According to strong rumours (albeit ones that are being denied by sources close to the British Prime Minister), processes have begun to award some kind of honour, to Jamie Dimon.  This wouldn’t even be particularly out of the ordinary – honorary knighthoods are often given out to people of global prominence (Bill Gates has one) and JPMorgan is a fairly large employer in the UK in places like Bournemouth and Basingstoke.  After a life of receiving bonuses that have made him richer than the King, Dimon might be about to get something that money can’t buy. (Or at least, something that can’t be bought for money without committing a serious criminal offence)

So will it be “Arise, Sir Jamie”?

Well, no. American citizens are not referred to as “Sir” when they are knighted (they just get to put “KBE” after their name).  And it doesn’t really seem like Jamie’s style to stand on ceremony. So even if the rumours are true, Sir Dennis Weatherstone (so far the only JPMorgan CEO to have been knighted – even John Pierpont Morgan himself didn’t get an honorary one) will remain in a class of one.  Unless and until Ed McGuinness does really, really well for himself, perhaps.

Elsewhere, we can’t help noticing that Barclays’ markets division is developing a bit of a habit of hiring people from pod shops.  The latest is Alexander Altmann, formerly an “equity macro portfolio manager” at Millennium, who will be in charge of “thematic idea generation” and “new equity strategies”.  (We are guessing that all three of these phrases basically mean the same thing; spotting new sectoral and geographic trends rather than picking individual stocks). Only a couple of months ago they did the same thing on the fixed income side, taking Owen Coughlan from Brevan Howard.

There might be a trend here.  As the multistrategy fund industry has grown, it’s tended to treat sell-side sales and trading in roughly the same way that the private equity industry treats advisory and capital markets – as a source of talent and a training programme.  But unlike private equity firms, multistrats have a tendency to churn through the young people they hire at quite a rate.  Either the pod’s capital is pulled after a couple of not-very-big losses, or they just turn out to not be as great places to work as they might have initially looked. And consequently there’s a circulation back into the investment banks as talented young staff return, a bit older and a lot wiser when it comes to the ways of hedge funds.

Meanwhile…

Bankers and hedge fund managers (as well as footballers) have been taking advantage of Italy’s generous tax regime for very highly-paid expats.  Now the locals in Milan, who are increasingly priced out of the nicest houses and amenities, are beginning to get cross about it. (FT)

The Andy Sieg revolution at Citi wealth management continues – he’s now hired Dawn Nordberg from Morgan Stanley to lead a new group focused on getting referrals to happen from the rest of the bank. (Advisor Hub)

For bankers of a certain age, the phrase “Equities in Dallas” will always recall Michael Lewis’s market classic, “Liar’s Poker”, which used it as shorthand for career death.  But with BlackRock and Citadel both supporting the development of a new stock exchange (“less regulated”, which might be a good or a bad thing), it might be the new place to go. (WSJ)

CITIC has cut base pay at its Hong Kong subsidiary CLSA, seemingly with the aim of reducing the gap between offshore and mainland employees.  Some bankers are facing cuts of 30%, and in current conditions there’s only limited opportunity to make that back with the bonus (Reuters)

Markus Braun, the former Wirecard CEO, has reached the “lawyer walks away because you’ve run out of money” phase of his downfall. (FT)

“I found it beautiful and­ mysterious—like I was on a safari.”  You wouldn’t necessarily guess that novelist Daniel Lefferts is talking about the time he used to date Wall Street men while researching his new novel “Ways and Means”.  It has scenes set on the JPMorgan repo desk, and descriptions of Patagonia vests and Excel spreadsheets. (WSJ)

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AUTHORDaniel Davies Insider Comment

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