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Morning Coffee: Goldman Sachs replaces its bonus whisperer. How 22-year olds can earn $175k driving trucks

Every leader sometimes needs the equivalent of what Mafia families call a “consigliere” (the role made famous by Robert Duvall in The Godfather and Billy Crystal in Analyze This).  It’s a trusted advisor, someone whose role in the organisation is that they can speak frankly to the boss and the board, and act as the voice of common sense.  At Goldman Sachs, this role is called “chief of staff”, and has been held for the last quarter century by John Rogers.  Until now; although he is staying at the firm and will continue to be secretary to the board and a member of the management committee, Rogers is being replaced as David Solomon’s chief-of-staff by his former deputy, Russell Horwitz, who’s returning from Citadel to take up the role.

Many profiles of John Rogers over the years seem to have focused on the fact that he doesn’t speak very loudly.  He’s variously been described as a “board whisperer” (because of his ability to build consensus on the board), a “CEO whisperer” (ability to persuade John Corzine, Henry Paulson, Lloyd Blankfein and David Solomon) and a “bonus whisperer” (ability to calm down angry MDs and Partners during disappointing compensation years).  He appears to have learned the trade of smoothing over big egos in Washington; as a young official in the Reagan administration he was responsible for things like parking spaces at the White House and arbitrating disputes over who was allowed to book the tennis courts.

His replacement as chief of staff seems to have a similar skill set. Russell Horwitz was the chief negotiator responsible for getting a global settlement of the 1MDB affair, and sat next to Lloyd Blankfein during the bruising 2010 Congressional hearings on Goldman’s role in the global financial crisis.

That connection has raised a few eyebrows: Lloyd was rumoured to have been critical of David Solomon’s management at a conference earlier in the year.  Horwitz has been described as being “viewed as a Blankfein loyalist”, which might make him an odd choice for a role so close to Lloyd’s successor.

However, there’s not really much evidence of any sort of personal conflict of loyalties; Horwitz was hired by Henry Paulson, not Lloyd Blankfein, and the 1MDB crisis would have involved working every bit as closely with David Solomon.  His brief departure to Citadel seems to have happened after losing a bid to take on some of John Rogers’ responsibilities, but there’s no obvious grudge there either; Rogers and Solomon were both directly involved in the bid to bring him back, and it seems that the Citadel executives didn’t make much of an attempt to retain him, knowing that “his heart has always been at [Goldman]”.

So now the board have the exclusive services of their “whisperer” and David Solomon has his “Mr Fix-It”.  One word of warning – titles don’t necessarily mean the same thing at that level.  Although both Rogers and Horwitz are partners, the chief of staff has historically had the title of “Executive Vice President”.  Although EVP is quite a lowly rank in most investment banks, it would probably be a big mistake to send either of them an email saying “pls fix”.

Elsewhere, how about a job that pays roughly the same as a junior investment banker, but only requires fifty hours work a week?  Under their latest deal with the trucking unions, long haul drivers at UPS can earn $172,000 a year after four years’ experience, which would put them more or less in the middle of the pack for Associate salaries; not quite as good as Evercore or Lazard but better than HSBC or BNP Paribas.

Obviously, there isn’t much option for remote working, but according to this interview the conditions aren’t too bad if you don’t mind spending a lot of time on your own.  You might drive 125 miles a day and deliver more than two hundred packages, but there are no emails in the middle of the night, and although you’re apparently sometimes “grilled and made to feel guilty” about taking time off, there’s a strong union protecting you against the equivalent of MDs.

Meanwhile …

Deutsche Bank “might have pulled back too far” in some investment banking teams in Asia and sees good opportunities to hire back ahead of a recovery in Asian M&A, according to CFO James von Moltke. (Straits Times)

David Kurtz, Lazard’s global head of restructuring, has decided that he’s not going to “transition to a new role as senior advisor” in September after all – he’s going to Hilco, a specialist in helping bankrupt retailers. (Reuters)

When someone claims to be a “seasoned trader” with experience at Wall Street investment banks and an Ivy League degree, it’s usually best to check them out before giving them any money to manage.  Christopher Anthony Slaga, also known as “Keith Renko” might have an entirely satisfactory explanation for everything when the authorities finally find him, but $3.1m of investors’ money is apparently gone. (US Attorney’s Office)

If you’re struggling through some compulsory compliance training today, spare a thought for your colleagues at China International Capital Corp, Bank of Communications and even the local offices of BlackRock, who are being asked to attend lectures (and even write essays) on the political thought of Xi Jinping.  Some bank executives are spending as much of a third of their working time reading four Xi books a month. (Bloomberg)

Still no word on the succession plan for Paco Ybarra at Citi.  Although he has seven deputies who might be up for consideration, CEO Jane Fraser has suggested that “the division of his responsibilities will be made in a manner that’s consistent with the work Citi is doing to simplify its structure”. (American Banker)

If you have the misfortune to find your name on a US sanctions list, it’s extremely difficult – although not quite impossible – to appeal and start to build your career back. (Finews)

Now that Snoop Doggy Dogg is on LinkedIn, which cannabis investment banker will be the first to get an endorsement from him? (LinkedIn)

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AUTHORDaniel Davies Insider Comment

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