It is also pretty scary when almost all the top talents want to be bankers. what kind of society will it be when the top talents all become bankers?

I guess you won’t comment on the corruption in China. Corruption takes on a new meaning there. I don’t know if it is true or not, but I heard all the high ranking party members are either Master graduates or Ph.D graduates regardless their real education levels. I hope this is not true, but who really knows? I guess the same can be said about the GDP also.

Thanks for the wonderful response and it is a great pleasure to know that we both went to Columbia and majored in Physics (though I was actually in applied physics, in the fu foundation school of engineering).

There is of course no objective measurement of talent and I agree academic research achievement may not be the best proxy. My judgment, ultimately, is framed by my own experience, which includes knowing quite many Beida/Tsinghua-ers who are less than impressive.

Also, that Beida & Tsinghua are the target of every student in the nation may be true, save, perhaps, for Shanghai. Most kids in my high school (one of the best in Shanghai) prefer Fudan to Beida/Tsinghua, with the best of them coming directly to the U.S. for undergrad study on full scholarships.

I’ve worked with students ascending the ranks of both Universities mentioned, mostly as their professors recruited me as an expert in the field for graduate projects they were undertaking. The kids stunned me with their aptitude and knowledge. Frankly, my encounters with Beida students — far more than anything I’ve encountered domestically — have filled me with hope for innovation and advancement in the future.

MIT and Stanford are both hollow shells of what they once were. I’ve been repeatedly and distinctly underwhelmed by both the choices made by administrations and bean-counting CIO’s across U.S. higher ed, and the lack of work ethic and practical skills in the student body. All the money and prestige in the States goes into facilities and football and basketball teams. It’s embarrassing.

Grad students in Japan were the most mediocre I’ve encountered, which seemed strange to me since they’re sharp people who don’t travel or study abroad as often; contacts there report the good talent gets an undergrad only before being slurped up by the corporate world.

nice shot from fitzgerald but unfortunately some of the brightest on both sides of the atlantic have for decades gone straight into banking , except perhaps during the depression and war years? There was an interesting article in the nyt regarding pay in relation to the banking industry; would be interesting to hear from an experienced alumnus of the industry? what do you think?

After the end of the cycle, however, finance declines sharply in importance over a several year period and becomes much less of a draw for the most talented and ambitious. Remember that in the very first paragraph of “The Great Gatsby” Nick Carraway decides to become a bond salesman after graduating from Yale largely because that is what everybody else in his class did. A decade later he would have never made that choice. I suspect that in three of four years investment banking will draw a much smaller group of top gaduates, in China and elsewhere.

I think it’s great that yo’are able to help your students get some of the most desirable jobs in the financial industry. However, given that the Beida students are among the smartest in all of China, don’t you think this is a waste of talent? I think there’s no doubt that – measured by the value-added of their work/output – investment bankers are vastly overpaid.

It is not a crime for a Chinese individual to be driven by pecuniary interests (i.e., to pursue a job in the financial industry), but don’t you think if this continues, China will move towards the same direction that other financial centres such as NY or London have moved to, where you waste an awful lot of human resources in the banking industry by paying them generously for moving money from A to B instead of performing other jobs with a larger substantial value-added for the real economy?

To cut it short, as with any other country, do you think it’s the best thing for China if most of its smartest graduates become bankers?

It’ll really be interesting to see how those loans are kept out of those greedy speculative grasping hands. The very price and volume of the speculative runs on metals and other commodities would indicate margin trading no?

Marks, there are supposedly strict limits on margin financing, but of course money is fungible and there is a lot of anecdotal evidence that margin rules are bent. In addition forward purchases or purchases in futures markets are automatically on margin.

Matt, some very good Chinese undergraduates do go abroad, but just given the weight of numbers I agree that most of the top students stay in China. The problem for the top students is not always money, since most of them come on scholarship, but also language. Buy the way I am not sure if the brain drain is better or worse. My understanding is that most Chinese students in the US, especially the top ones, still generally end up staying in the US. At any rate we really need to get long data series before we can know because in the short term volatility in migration patterns is always highly correlated with the economic cycle.

I hope to see you and your friends at the New York shows, Matt. Xiao He really is an astonishing musician and he is pretty excited about going. This is his first vist to the US and he just got marrried last Saturday, so lots of things are happening to him.