What bankers hope for and fear in 2023
Danger looms in 2023, but that doesn’t mean there isn’t anything to look forward to, either.
The 1,500 of you who responded to our survey answered questions about your bonus expectations, job security fears, and even your inflation worries. But these were your big sources of excitement and trepidation for the next 12 months.
Will the Fed pivot?
This is the key question both for markets and for deals. A fed pivot on rate rises could be good for both in the short term.
A JPMorgan vice president in debt capital markets spoke for a lot of people in finance when he said his biggest hope for next year is a “Fed pivot with rate cuts starting late 2023.”
Equally, though, one macro MD at Morgan Stanley pointed out that the febrile move surrounding Fed decisions has been pretty good for macro traders this year and expressed some apprehension about it possibly coming to an end.
Will my bonus fall? Will I ever be able to buy a house?
Plenty of people were fearful of diminished bonuses and its impact on their spending power in an inflationary world.
A London asset manager who "saved well through [his] early years" said he was worried about a "prolonged recession and house prices." A Swiss private equity associate told us he was rather hopeful of joining the property ladder but fears "for friends in less secure, well paid industries."
Some felt they were being unfairly persecuted. A Spanish VP at Citibank was worried about ""banker bashing" and "protestors ruining everything" as he now "cannot afford to pay rent.
Going back to the office
There were some concerns about being summoned back into the office. One private equity associate earning over $300k was worried about "not being able to travel enough" as his days in office rose from one to five.
Others are taking it slow and steady. “I am happy with my job and my lifestyle. I want to improve exposure to other aspects of my role and rise up to leadership position,” said one asset management analyst who added that he recently began taking public transport due to rising costs.
Not everyone is so happy. One Credit Suisse director says their greatest hope is that their US business has a “controlled unwind”. His greatest fear? that it "implodes completely." A snarkier director, this one from technology, hopes for the bank won't be "run by idiots anymore."
Will we start World War 3?
For as much as bankers spoke of worries regarding monetary and social matters, the geopolitical climate was far and away the biggest fear.
Echoing Nouriel Roubini who's been cautioning about the impact of nuclear war on New York City, one HSBC VP got straight to the point, simply saying his big fear is "WW3". A female director in London said she fears "geopolitical risk" while a New York VP fears "escalating wars."
Others aren't as dramatic. One RBC director declared his hope that Europe will "stabilize." A BNP director in Italy said it will be "difficult to keep up with the politics in a lower revenue world" but sees 2023 being "slower"
Beyond looming war, COVID is still an issue. A NY MD said he's worried about a "resurgence."
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