Of all the drivel that gets published these days, this one by William D. Cohen, published (where else?) in the New York Times' "Opinionator" section of its website, is patently stupid. Cohen asks (perhaps asserts; I could barely read this post) that if more women were in charge at the investment banks, would so many risks on housing securities and derivatives been taken? Would a little stronger pulse of estrogen have cooled off some of this risk taking?
The answer is no. (First, according to Gillian Tett, of the FT, a female at JP Morgan pioneered the use of some of these credit default swaps.) Look, Cohen is no doubt a smart guy, and he worked at GE Capital and as a banker for 15 years, and has forgotten more about Wall Street than I'll ever know, but puh-leeze. This gender/minority thing has got to stop. What should be the proportion of women working on Wall Street? Should it be equal to their number in the population at large (i.e. about 51 percent)? Or should it be some other proportion (say, based on the number of female lawyers or doctors or NYC subway conductors)? And who should decide upon the "natural number" of employment? Wall Street, first of all, does everything it can to hire women, minorities and gays. (If you read my 2006 artice in Registered Rep., a spokesman for the Human Rights Campaign Foundation told me that Wall Street gets an A for "inclusiveness" and in fact was a pioneer in insuring its employees' gay partners and transgendered employees years ago ("It's capitalism at its best," he told me, no one cares what your sexual orientation is or what color you are so long as you are "green," as in a producer). One executive of a major brokerage told me a couple of years ago that he'd kill to hire a black person or woman retail financial advisor --- or banker of any kind --- if only he could find a candidate.
But, I digress. The idea that a woman based on her biology wouldn't have gone long mortgage-backed securities (or pick your various derivative poison) is interesting in that it revives the concept that certain people, because of their biology, are unfit or better qualified for certain tasks or employment. And let me leave you this parting shot: Sallie Krawcheck, who was CFO of Citigroup during the housing/credit bubble, was in a position to know the firm's balance sheet --- that was her job. Gosh, how'd she do? Sources I know who know her and worked with her there say that she told them she didn't understand some of the complex asset-backed securities that nearly destroyed Citi. (Sorry, Sallie, I do think you're awesome, and I can't call you this Saturday a.m. for comment . . . but you, like everyone else --- or nearly everyone else --- just got slammed by those securities.)