"Top Talent" Fleeing Regulated Banks?

by Teh Nutroots | Yes, because money talks and bullshit walks---or in this case, "flees," like fleas deserting a dead dog.  As the following article amply proves suggests:

Top bankers have been leaving Goldman Sachs, Morgan Stanley, Citigroup and others in rising numbers to join banks that do not face tighter regulation, including foreign banks, or start-up companies eager to build themselves into tomorrow’s financial powerhouses. Others are leaving because of culture clashes at merging companies, like Bank of America and Merrill Lynch, and still others are simply retiring early.

This is certainly a concern for the banks losing top talent. But other financial experts believe it is the beginning of a broader and necessary reshaping of Wall Street, too long dominated by a handful of major players that helped to fuel the financial crisis. The country may be better off if the banking industry is less concentrated, they say.

“If the risk-taking spreads out to these smaller institutions, it is no longer a systemic threat,” said Matthew Richardson, professor of finance at the Stern School of Business at New York University. “And innovation is spreading out too. This is a good thing.”...

I don't even know what that means and it pisses me off.   There would be less of a systemic threat if our financial wizards were less venal and self-serving.  What are the chances of that happening?

Sensing a shifting tide, talented bankers who fear a dimmer future at banks that have taken taxpayer money are migrating to brash boutique firms like Aladdin, which are intent on proving their critics wrong by chasing fast profits and growth in hopes of one day rising up as challengers to the old guard....

These kinds of start-ups emerged in earlier cycles, and many remained small and inconspicuous. But some evolved into scrappy rivals. In 2006, senior bankers from Goldman and Morgan Stanley formed Perella Weinberg, a top boutique. Roger C. Altman, a former Lehman banker, created Evercore, another top performer, a decade earlier.

Today’s upstarts aim to do the same by hiring away the industry’s talent and, in some cases, trying to replicate the entire investment banking model that was largely dismantled after Lehman Brothers fell last fall. (NYT)

Do not let them. 

Update.  Atrios:

Or, NYT, maybe they're just rats leaving sinking ships?....Most of the article doesn't really support this story of tighter regulation and crackdown on compensation...it's about people leaving failing big firms for new smaller firms. Nothing to do with the bailout, really.

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