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Morning Coffee: Billionaire bank CEO offers advice on raising children. Banks that were hiring MDs in 2023 are still hiring in 2024

Rich Handler, the CEO of Jefferies, has been doing another “ask me anything” on his Instagram story, and one of the questions is particularly interesting. Someone asked, “What are your thoughts on inheritance? Is it a net positive or negative for children?”. 

Handler is quite uniquely well-placed to give a view on this; although nobody can really see things from both sides, he came from relatively humble beginnings to the top of the poshest industry there is. So he’s worked alongside children of privilege, understands the specific problems and expectations of the very rich indeed, and has also had to wrestle with the challenge of raising a family in conditions very different indeed from his own upbringing.

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Back in 2017, Rich shared some much more detailed parenting advice, publishing an edited version of the “100 Things To Know" letter that he gave his kids when they left for college. It included tips like “You rarely get this clean slate in life so take maximum advantage”, “Be as outgoing as you can stand” and “Even when professors suck, it isn’t an excuse to do cruddy in the class”, as well as “Never allow anyone to be bullied”. 

But in the abbreviated Insta form, he mainly spelled out the pitfalls. As he put it, “it is very easy for financially successful people to deprive their children of the chance to fail, or [to] enjoy the privilege and satisfaction of self-accomplishment”. Raising kids that are “ambitious, tenacious, dedicated, humble, polite and hardworking” is, in his view, hard work, and requires “total value alignment with both parents”. 

This is a big problem in the UHNWI world – although wealth management firms, elite finishing schools and every other kind of service provider advertises their ability to teach the younger generation the value of money, Handler is almost certainly right to say that this is a job you can’t outsource. Kids learn by example much more than in any classroom, and as the prestige television writers of the world know, it’s the easiest thing in the world for a driven and ambitious wealth builder to miss out on passing on those values, then reach the end of their life and realize they have nothing in common with their own children. Without throwing any darts, Handler has his own warning against that outcome. As he says, “Financially successful people whose kids are entitled, arrogant, lazy, judgmental and disrespectful, really are poor”. If you’re scared of that happening to you and your family and want some advice from Rich about how he did it, apparently the best time to catch him replying to Insta comments is early in his commute or when he’s on a flight.

Elsewhere, this week saw more evidence that although the overall market isn’t great, there are still good jobs available for the right people.  Firms like Deutsche Bank and Rich Handler’s Jefferies are still interested in building out their franchises, and that means that they’re still making managing director (MD) hires where they have a vacancy.

It’s not really a question of “what do I need to do to get one of these jobs?” so much as “if you’re one of the top performers in a market or segment where someone has identified a growth opportunity, they’ll come to you”.  The MD hires this week aren’t in red-hot sectors like crypto or private credit – Deutsche has hired Michael Hufton to be co-head of APAC infrastructure and utilities, while Jefferies has hired Philippe Drouin to be head of EMEA food & beverage and Vincent Thiebaud to be head of Swiss investment banking.

These really aren’t “growth areas where everyone’s hiring” – they are jobs where “everyone who is serious about this region has to have someone respectable in this role”. They say more about the strategic direction of banks like Jefferies and Deutsche than they do about the overall state of the market.  Which might be good news for MDs who are doing a good job in a less sexy sector right now.

Meanwhile …

In banking, strategic priorities are a matter for informed speculation, but real estate decisions are a matter of fact.  Bank of America is getting rid of one and a half floors that it formerly occupied in the Cheung Hong Centre in Hong Kong; although some support staff are being moved to Kowloon, this looks like a definite decision to reduce its footprint in the market. (Bloomberg)

Usually, private equity firms understand “raids” on senior talent to be part of the cut and thrust of the industry; after all, they make a practice of staffing their junior ranks at the expense of sell side training programs.  But Barings has run out of patience at a particularly swashbuckling episode which saw it lose nearly all of its private credit team to Corinthia Global Management, a new venture backed by Nomura. They’ve filed restraining orders and preliminary injunctions. (FT)

Governments feel like they need to regulate artificial intelligence, but they are coming up against the same problem as banks in trying to staff up – they aren’t offering the kind of work that excites qualified people and engineers, so they have to pay up.  And since they’re public sector employers, even this solution is difficult for them. (WIRED)

JPMorgan has launched a specialist sports investment banking team, to be co-headed by Eric Menell and Gian Piero Sammartano.  Slightly disappointingly, neither of the heads seems to have a background in professional sports themselves – they’re respectively co-head of North America and head of EMEA in the existing media investment banking team. (Business Insider)

Significantly more exciting than “Goldman Sachs at 150”, the new German TV series “Herrhausen – The Banker and the Bomb” covers the life of a former Deutsche Bank chairman and the mystery surrounding his assassination in 1989. (Variety)

Rare Beauty, the cosmetics company launched by Selena Gomes, has hired Goldman Sachs and Raymond James to evaluate options.  If you know anyone on the consumer goods team there, send them a text saying “Only Mergers In The Building”. (Womens’ Wear Daily)

Wu Qing was previously known as “the broker butcher” for harsh regulation of the Shanghai Stock Exchange, but he has now been given the job of nurturing domestic Chinese brokerages to compete with Morgan Stanley and Goldman Sachs by 2035. (SCMP)

Former Credit Suisse intern turned crypto hedge fund manager Kyle Davies of Three Arrows Capital apparently didn’t show up for a court date because his lawyers didn’t remind him.  He still has absolutely no intention of seeing the inside of a prison cell, and so won’t be going back to Singapore for a while.  He also says that only the “lamestream” media are interested in any payments to related entities that might or might not have taken place shortly before insolvency. (Protos)

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AUTHORDaniel Davies Insider Comment

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