In Mark Bernstein ’83’s article about Karen Ho and Wall Street, I was struck by two comments — one cynical and the other fanciful: that being a Princetonian with a pulse secured Ms. Ho a job, and that renaissance graduates from Princeton and Harvard were shown the red carpet as they made their way to Wall Street. I would maintain that neither proposition is true, nor were the best and brightest — pulsating art historians, for example — the real culprits in the crash.
Rather, it was the abandonment of the most basic underwriting standards and lack of fundamental due diligence — can a borrower repay a mortgage? — that should draw our attention. Furthermore, while causes of economic cycles may differ, that we live within them is a fact; and what ensures their recurrence is that while the business of bankers should, indeed, be the awareness of cycles, we never seem alive to the fact that we are actually in one.
By the way, Wall Street could do with a lot more philosophers.