Daniel, the Quant
For about 25 years, I have worked on Wall Street, first as a reporter and then for several of its firms. “The Street” is a social ecosystem that is unique in its outsized effect on the rest of the world. Like the proverbial butterfly that flaps its wings and sets in motion a hurricane, the Street’ s everyday business can foster widespread prosperity or misery, often in unpredictable ways. In a series of blog posts, I hope to shed some light on a place that remains opaque to outsiders. The names have been changed for my protection.
I met Daniel in a yoga class near Wall Street. He was as young or younger than the lithe women in their revealing outfits, but he stood out as male, pale and pudgy. He wore oversized gym shorts and faded t-shirts, and heavy black glasses that remained on his face even when he attempted a headstand. His yoga technique was beginner-level, but he threw himself into every pose, no matter how difficult. When he removed his glasses to wipe sweat from his face, he looked like a mole blinking in sunlight.
He was French, but spoke fluent English with a breezy, affable manner that I found endearing. He was employed by Goldman Sachs on its quantitative trading desk, where he designed derivatives based on mortgage-backed securities portfolios. The year was 2006: Daniel was the equivalent of a man stoking the furnace of the Titanic as it bore down on the iceberg.
I was impressed when I learned what he did for a living: To be a quant at Goldman Sachs, Daniel had to have a brilliant mind for mathematics. He looked away and shrugged: “It’s just a job,” he said. Then his exuberance returned. “But it’s fun. Life is good.”
I didn’t ask him how much money he made, but in the etiquette of the Street, I said, “bonuses should be good this year,” to which he shrugged again. I expect his income was at least a million dollars that year. He was perhaps 24 years old.
We talked sometimes about the market, and I told him I believed it was overheated, quite possibly headed for disaster. But he always flipped his hand and pursed his lips, as if I had suggested it might rain tomorrow.
When the crash came, Daniel became one of thousands of quants laid off by Goldman Sachs. He disappeared from the yoga studio.
One day in late 2009 Daniel reappeared. His skin color was healthier; he had lost weight. He had mastered the headstand. With no reason to go downtown each day, he told me, he had been attending a class closer to his apartment. He had taken parachuting lessons. He laughed when I said I had been concerned about him—because of the crash. “Things happen,” he said. “It’s not the end of the world.”
“What are you going to do?” I asked him. Again he gave me the Gallic shrug. “I may go back to school. I may go back to France. I don’t know.” He paused. “But life is good.”