Photo by Aranka Israni
Story by Richard Shinder
Gonzaga’s annual New York Trek, held each September, allows finance students to explore career opportunities, network and display their professional “bona fides” to prospective employers. Richard Shinder, a partner at Perella Weinberg Partners, has participated in all five NY Treks.
When I graduated from Gonzaga in 1989, the notion of finding an entry-level position at a New York-based investment banking or asset management firm – a job on “Wall Street,” in other words – would have been the stuff of fantasy. Gonzaga was not yet a national basketball power, nor did it figure in the popular consciousness in any meaningful way. I made my way to New York in 1993 by way of an M.B.A. from the Wharton School of the University of Pennsylvania, and quickly discovered that my Gonzaga gear prompted questions such as “Are you from D.C.?” (the location of a regionally-known Gonzaga High School). Given those years in the figurative wilderness, which were brought to an end by the success of GU men’s basketball (thank you, Casey et al), I was thrilled to support Gonzaga’s extension of the Trek to New York in 2007. Knowing how challenging my own path to Wall Street had been, I was supportive of any “leg up” that I and other New York-based alumni could give to younger GU graduates and alums as they follow their dreams – roughly 2,500 miles due east of Spokane.
What I had no way of knowing in 2007 – the year of the inaugural NY Trek – was that the somewhat generic challenges facing GU grads in obtaining a financial services job in a highly competitive job market (facing off against the Ivy League and other traditional “feeder” schools for Wall Street) would be radically altered by the financial crisis that crested in the fall of 2008 and continues to reverberate through our world today. Thinking back over the five New York Treks, including the most recent one this September, I can see how the narrative arc of my own recent career experiences (and my employers during the “Trek era”) revealed some of the fundamental changes in our national economy, financial markets and society generally.
In 2007, I had taken a position with Avenue Capital, a hedge fund specializing in corporate credit, high yield and “distressed” investing. I left behind a 14-year career as an investment banker focused primarily on advising financially distressed and bankrupt companies. Working in this new capacity gave me an appreciation for the perspective of this first crop of Trek students, for whom all my talk of credit default swaps, relative value and capital structure arbitrage likely sounded more than a little mysterious. I was then myself in the process of peeling away some of the mystery of these esoteric financial products and concepts.
While the high yield markets had started to “close down” in July 2007 (meaning it was becoming increasingly difficult for companies to finance themselves), in September the Standard & Poor and Dow Jones equity indices would make all-time highs. Prospects for employment opportunities on Wall Street opening up to GU grads seemed promising – provided Gonzaga continued to facilitate students’ exploration of such opportunities. The quality of the Trek students and the broader market environment convinced me that our “beta test” had been worthwhile.
The 2008 Trek would prove a different circumstance altogether. The financial crisis was unfolding in real time as the group of Trek students made their way to New York. Lehman Brothers had failed, a prospect that seemed inconceivable only weeks before. By this time, I had left Avenue for a similar position with Goldman Sachs. I found the investing philosophy and team approach at Goldman familiar and conducive to the sort of investing I was focused on (credit-intensive, high risk and illiquid investments).
Carson Bowlin (’11) works as an analyst with Morgan Stanley Smith Barney. His role in the capital markets division requires broad knowledge of global markets and products, ranging from high-yield debt, to structured securities, to precious metals trading. NY Trek 2010: “At Deutsche Bank, Gonzaga alumnus and Trustee Kevin McQuilkin had us meet with his first and second year analysts. The caliber of these individuals and the impressive backgrounds they possessed set a high bar and showed me what it would take to compete.” What students need to hear: “You must ‘own’ the next chapter of your life. Regardless of the trying economic times, there are incredible opportunities to be had. Reject complacency and set your goals. This process must be well on its way by your junior year.”
In some respects the 2008 Trek is both the most and least memorable for me. I recall walking into a sunlit conference room just off the Goldman Sachs trading floor with terror in the pit of my stomach to meet a bright-eyed group of underclassmen and women. That day may not have been the absolute nadir of the financial crisis, but it was close. Concerns about the global financial system shutting down were at their height. In the preceding days, an eerie calm had fallen over the financial district in lower Manhattan as the assumptions and trust upon which functioning financial markets rely – counterparties performing on contracts, banks lending to one another at the interbank offered rate, and rational responses to offered incentives – were being tested. I recall asking a junior colleague to describe the tasks and responsibilities of younger team members in our group, while I left the room at one point to attend to a financing-related matter. Upon returning to the conference room, I could see that the students were simultaneously fascinated and confused by the obvious stress that I was under, and I recall making a few feeble attempts at gallows humor while the markets continued to plunge, including encouraging them to consider a career on Wall Street “if we are all still here.”
Fortunately, by fall 2009 stability had returned to the markets, and the economy had begun to show signs of improvement. I had recently joined a startup advisory boutique, Perella Weinberg, and was busy with several companies navigating the tail end of the “Great Recession.” Ironically, as a senior at Gonzaga, I had applied to several top business schools with an essay noting my admiration for Joe Perella, who was at that time in the process of leaving First Boston to start his first entrepreneurial venture, Wasserstein Perella (which he sold 10 years later for $1.4 billion to Dresdner Bank of Germany).
With the benefit of student feedback and some repeat attendees (the Trek has come to take sophomores, juniors and seniors, with a focus on juniors), the quality of the 2009 students and their level of preparation was impressive. Our first student to land a job in investment banking in New York was part of this group. The 2010 Trek continued this trend. The combination of a seemingly more stable economic and capital markets environment, along with GU’s commitment to the New York Trek and “real world” examples of students finding positions in New York, validated the original notion that the New York Trek would prove a worthwhile investment of University and alumni resources.
Positive momentum notwithstanding, the 2011 New York Trek has found both the Trek and the broader economic and societal context at a crossroads. The successes noted above stand in contrast to an abortive economic recovery and a redefining of the notion of modern financial capitalism. At the same time, the economic primacy of the West is being challenged as never before. National economic questions abound: the long-term impact of hollowing out a modern economy’s industrial base, the related loss of export competitiveness, the consequences of chronic underinvestment in national infrastructure (both physical and social, particularly primary education), and the implications of uncontrolled entitlement spending (transfer payments, social insurance and health care). All of this transpires in a threatening global economic environment and with the federal government already having fired many of its bullets from a depleted arsenal in ill-conceived, short-term attempts to “jump start” an enfeebled economic recovery. Today’s NY Trek students confront an economy failing to create jobs, a public sector struggling with the legacy costs of decades of unwise economic decisions, and a financial sector with uncertain prospects.
Phil Chowaniec (’10) is an analyst in the mergers and acquisitions group at Oppenheimer & Co. in New York. What students need to hear: “Concentrate on your network and keep your mind open to as many opportunities as possible. Despite economic challenges, at least in my field, all banks still need new grads to fill the analyst ranks – it is just that much more competitive to get in.” Jimmy Barber (’11) is an investment associate at Putnam Investments. NY Trek 2010: “My most memorable experience from the NY Trek was visiting the New York Stock Exchange. The group was able to walk around on the floor of the exchange and talk to various traders. To stand in what is literally the center of the financial universe was an experience I will never forget.”
However, talented people find opportunities in any environment, and the accepted wisdom of one moment can find itself in the ash heap shortly thereafter. Business Week magazine famously declared “The Death of Equities” in 1979, three years before the stock market bottomed and subsequently commenced a 25-year rally during which the value of the Dow Jones Industrial Average increased over 17-fold. Serious industry participants have asked whether Wall Street needs to be reconceived or pared back to its narrower historical role of assisting the industrial economy with corporate finance.
Moreover, while 1989 seems to me like just a moment ago, I also recognize that it is the province of the well-seasoned to look through the prism of their own experiences and fight the last war – sometimes with a “beggar thy neighbor” sensibility. A reordering of the global financial architecture need not only (or even) limit domestic (or Western) opportunities in financial services, but may very well open new vistas to the globally minded. And I have great confidence that the holistic liberal arts education and belief in life-long learning inculcated in GU graduates will serve them well, just as it has served me. It may be that one of this year’s GU Trek participants will help one day to lead the U.S. financial sector toward a new relevance, making the industry’s dizzying heights reached in the mid-2000s appear quaint and the 2008 financial crisis a distant memory.
