<p>Alex, I think you hit upon a crucial point – that is, the reason that i-banks were able to recruit the best and the brightest talent (and more to the point retain them) was a simple matter of “show me the money”.</p>
<p>That equation doesn’t compute anymore. No risk, no reward. And that is where we are. So, yeah, if you have always had a burning desire to run spreadsheets into the wee hours of the night on some mega merger, that work will, of course, still exist… but don’t expect i-banking pay to punch above other industries the way that it did in the past. And if the money isn’t there, and the “prestige” is waning, then why do it in the first place? Isn’t it far better to do something that you really want to do? This is another unintended consequence of the current circumstances. As i-banks lose talent, it will after a period become just another hum-ho industry. I (and Sakky to a certain extent) have been arguing that this trend was taking place far before this crisis started anyways, this only accelerates this trend.</p>
<p>When the all of the dominoes have fallen, the financial industry will look far, far different than it did before this crisis started. It’s anyone’s guess what it will look like, but one thing is for sure, the days of fat i-banking bonuses and executive perks are over.</p>