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How will 2012 be remembered in the annals of finance? In the annals of finance, 2012 was eventful, but won't be remembered as remarkable. The year won't deserve a chapter in economics texts or finance history (like the years 1987, 1998, 2001, or 2008). The financial system didn't collapse, and equity markets, although sometimes unsettled by volatility and uncertainty, didn't fall through a sinkhole. No major financial institution went bankrupt; many continued to improve their balance sheets and narrow their business scopes.  Deals got done, although at a pace still far below the torrid mid-2000s. China proved to be human--at least in economic prowess. Brazil was proclaimed a favorite emerging market. Interest rates remained near zero, and banks remained squeamish about the burdens of new regulation. A few events, trends or phenomena, nonetheless, will stand out. Every year something unexpected occurs, a close-to-black-swan event (the large, breath-taking losses at JPMor...

Now is the time to prepare for interviews Most MBA students know that to secure the right job in financial services, you can't stroll out of the classroom, jump into an interview suit, and glide into a round of interviews.  Preparation is critical. You don't secure the dream job with a few practice sessions of the elevator speech. One of the best ways to gear up and prepare for the rigors of recruiting season is to have a useful framework, one that you can use to formulate a strategy, demonstrate expertise, and express a self-brand. The goal is to get from campus to a significant summer internship in finance in investment or corporate banking, investment management, private equity, asset management or corporate finance.  Indeed in the post-crisis environment of 2013, the world of finance has emerged from the abyss, but opportunities continue to be fleeting, segmented and scarce.  Approaching interviewing season with strategy, framework, optimism and unbridled confidence c...

What lies ahead in finance? After a long haul and after markets watched and studied the results, we've jumped the hurdle of the presidential election . We now head toward a year-end where sound bites and gurgles of noise from Washington scream "fiscal cliffs" and a possible end-of-world scenario if legislators don't reach an agreement and unveil a fiscal plan before January 1. Often in an election year, capital markets and finance managers go through pauses, starts and stops. They gauge the political winds that will affect economic recovery, interest rates or the tendencies for companies to invest in growth, merge with others, borrow long term or issue new stock. The election is done, and it's time to bring on 2013, of course, after legislators cease jousting with each other. What lies ahead for professionals in finance ? What is the outlook for those who manage portfolios, trade derivatives, underwrite securities,  borrow funds, invest in big projects, advise cli...

In finance circles, Jefferies , the mid-sized, New York-based investment bank, is a "tweener"--too big and mature to be a young upstart, but not  large or imposing enough to earn the label "bulge bracket" or "too big too fail." Like a Knight Capital or MF Global, if Jefferies were in danger of sliding into oblivion, government regulators and market counterparties would let it go. Amidst all the post-election squabble about "fiscal cliffs" and recent stomach-churning market volatility, Jefferies quietly slipped into the business news this month. It agreed to be acquired by its minority owner, the conglomerate holding company Leucadia .  The transaction won't shake the broker/dealer world. It may hardly move anybody in any way. But it brings to mind the consistent, stable performance of a niche investment bank, one that has always been too small to be a threat of any kind to behemoths Morgan Stanley, Goldman Sachs and JPMorgan. Yet it is one ...

UBS , the Zurich-based global financial institution, announced last week that it plans to dismiss 10,000 employees as it continues, like most big banks, to review, revamp and re-scale its business units around the world.  That's not an unusual news item. In financial services, that's a news blurb we see almost every other day. UBS provided more details.  Most of the dismissals will come in its investment-banking group.  More specifically, its fixed-income businesses will suffer the most.  The dismissals, the down-scaling and shrinkage are unfortunate. The announcements are, nonetheless, not shocking, since they are a common event in the business press. This might, however, be the first wave of dismissals in finance, where the bank stepped up to admit  blame solely on its inability to justify business lines because of hefty capital requirements from the new wave of regulation. UBS says new regulation (in Switzerland and from the reforms of Basel II, II.5, and III...

USC-Marshall (above) announces a new "MBV" program Across the country at top business schools, MBA students keep a watchful eye on all that's necessary to secure summer internships and full-time jobs.  It requires hard, steadfast work these days to secure work. But through it all, they keep an eye on yet another ball--midterms now, final exams later. It's a task of terror to attempt to pile on 6-8 weeks of intermediate corporate finance into a few days. On campus these days, including at the Consortium 17 , students scramble to find jobs for 2013, ponder the presidential election in the days to come, rush off to case-group meetings, and bury themselves in cubicles to study for an exam in advanced accounting. The pulse is steady, even as many try not to worry too much about what will or won't happen by next summer. Choices and Challenges In between normal academic chores, Dartmouth (Tuck) MBA students found an interesting guest on campus two weeks ago, as part of...

Citigroup caught everybody off guard this week, when its board announced it had asked for the sudden resignation of CEO Vikram Pandit. Or did it catch anybody off guard? Was this a gesture  investors pushed for? Was it the right move for the big global financial institution that seemed to have leaped a hurdle to move beyond the darkest days of the financial crisis--back when there were moments when many thought its survival was in jeopardy? Over the past few years, Pandit and team took appropriate, bold steps to make the behemoth profitable again. They sold assets en masse . They shuffled bad, non-performing, defaulted, bankrupt, and/or foreclosed assets into a special holding company and, little by little, sold off these positions, properties, securities and full operations.  By doing so, it rid itself of spoiled segments and began to polish ongoing core operations.  They downsized in every way possible--in just about every unit, operation, division, and geography. They ...

In the past two weeks, national media outlets hopped on a storyline, proclaiming that MBA students and graduates in finance have reached a boiling point of discouragement in investment banking and other activities in financial services.  The Financial Times and CNBC reported last week that MBAs at top schools are somewhat turned off to investment banking as a long-term career, at least based on hiring patterns the past few years. Yahoo reported similar trends last week. The Financial Times reported the dimming in popularity of banking and finance in Wharton's recent MBA classes.  In the past three years, the percentage of graduates entering banking has declined from 25% in 2008 to 16% in 2011.  At Harvard, MBAs choosing banking declined from 10% of its class to 7%. Are MBAs turned off? Or are they scared off? Are they turning away, or are they looking more closely at alternatives--like consulting and entrepreneurship?  Is there a campus backlash toward the industry...

Let's pause for a moment, if the lightning pace of high-frequency trading permits us to do so. In the U.S. today, high-frequency, electronic, computer-aided trading accounts for as much as 65 percent of all stock-volume activity. Computers whiz and hum.  Black boxes send out trading orders in thousands and millions of shares, and rout orders to exchanges and "dark pools" all over the globe. Execution occurs in fractions of a second. Algorithms and programs determine what to buy, when to buy, when to sell, when to buy and sell at the same time and on which one of a dozen or more electronic exchanges. Algorithms provide guidance on volume, prices to show, prices to execute, and prices, if only for a few seconds, to report as "bids" or "offers." High-frequency traders dart in and out of trading positions in seconds. Some firms buy in one venue and sell in another. They earn pennies per share, but generate large profits via big volume--tens of thousands of...

Goldman Sachs leads; everybody else follows. Or most everybody else. So it has been for the past couple of decades in how corporate and investment banks structure themselves and recruit, develop, promote and pay for talent. And so it has been in how banks--from Goldman to regional banks involved in corporate banking and foreign banks that set themselves up on American shores--organize banking units. Traditionally since the 1980s, most corporate and investment banks (including also their trading, cash-management and processing units) recruit finance professionals into the following "programs," "classes" or "levels": 1. Analysts (those with BA or BS degrees) who join a two-three-year program and who virtually learn from scratch financial analysis, accounting, capital markets and banking on the job, while toiling away long hours doing the dirtiest of work for banking teams (spreadsheets, analysis, projections, document preparation, document printing, research...

Jenn Wei, a Stanford MBA who once worked in investment banking, is now researching, chasing and negotiating deals in technology as a venture capitalist at Bloomberg Capital.  Last week, in postings that appeared widely in business media, including  VentureBeat.com , she wrote about the startling, but not surprising lack of women in venture capital--in Silicon Valley (California), in Silicon Alley (New York) and at other pivotal venture spots around the country. She reminded us of the glaring scarcity of females at negotiating tables, within network huddles when ideas are bantered about, and in closed-door meetings where entrepreneurs, deal-doers and investors decide the right amounts for an early-round investment to support the next new thing. She offered a few reasons why women are not prominent in the industry and dared to propose solutions. She said women desperately need role models in the industry and industry participants need to take time to understand the likes, intere...

Yale SOM's new campus: One year away In late August, there's always a vibrancy on the campuses at business schools (including the Consortium 17 ) across the country as they prepare for the fall sessions.  New MBA students arrive on campus--wide-eyed, anxious, and excited about new experiences, new classmates and the challenges of in-depth study of finance, accounting, marketing, policy and recruiting.  Second-year students arrive after the intensity of summer internships (and with full-time offers for the fortunate ones), ready to resume studies in cherished, more interesting electives after the core courses are done.  Professors and deans get excited, too, as they are buoyed by the interests, eagerness and dreams of students. Always there is electricity during the early days of school in the fall, until students drift into an October grind, when it's time to ward off the pressures of upcoming midterms and recruiting chores. But for now, it's August, and there are new f...