The health of an economy can be measured by a comparison of the expected rate of return between
(a) $1M spent building better products
(b) $1M spent convincing the government to make rules that favor your company.
This puts me in an unusual disagreement with left-libertarian snark-master IOZ. IOZ argues that David Brooks column which suggests that geniuses are going into finance is false. Fact is, the margin is the right place to measure...and on the margin, the fact that finance produces insane returns for smart folks who are willing to work huge hours shifts effort from other areas into finance. Indeed, the EV in finance is simply better than anything else you can find....which means the more money minded of the 3+ Sigma set move more into finance, and less into other stuff.
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A friend of mine once interviewed at one of such firms (they had a taste for hard science PhDs and consulted heavily in quantitative finance) and told me that it was the first time he felt intellectually outclassed by the median interviewer. Given that he's in the high 3 sigma range, possibly bumping against 4, this would imply that said firm had 4, 5, and possibly even 6 sigma people working for them.
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