Investmment Banker For Hire
Episode 2: Optimism in Omaha and an MIT alum based in Hong Kong Chimes In
As we catch up with our friend the Oracle of New York, he is back in Omaha searching for work, quotes a strong vote of confidence in the market from Warren Buffet, and hears from an MIT alumni based in Hong Kong, who offers to circulate Josh's resume....and notes that in Hong Kong, they're hiring.
Oracle of NY by Joshua Perskey
I'm back in Omaha, and the Oracle of Omaha, Warren Buffet, has spoken through the N.Y. Times:
"Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.
" I don’t like to opine on the stock market, and again I emphasize that I have no idea what the market will do in the short term. Nevertheless, I’ll follow the lead of a restaurant that opened in an empty bank building and then advertised: “Put your mouth where your money was.” Today my money and my mouth both say equities."
As soon as I get back on my feet, I'll start buying stocks, perhaps Warren Buffet's Berkshire Hathaway.
I made progress on the job front again today, writing a sample valuation for a financial services firm in NYC and playing phone tag with a CEO from a car parts re-manufacturing company based in the U.K.
Meanwhile, my fame continues to spread in Hong Kong. I received the following email from a fellow MIT alumni based in HK:
Josh, saw your news front page on HK newspaper. As shown in this postcard, I believe that we are going though some tough snowstorm like times... remember those days at MIT when we had snowstorms, we used to go out and ski and throw snows when classes were on halt. We should take it lightly and try to weather through this storm with a small sense of humour just like what you did. Listen, I work for a Canadian Bank called Royal Bank of Canada and we are rather immune so if you would like to shoot me your resume, I maybe able to help. FYI, we are hiring especially in the far east!
I made progress on the job front again today, writing a sample valuation for a financial services firm in NYC and playing phone tag with a CEO from a car parts re-manufacturing company based in the U.K.
Meanwhile, my fame continues to spread in Hong Kong. I received the following email from a fellow MIT alumni based in HK:
Josh, saw your news front page on HK newspaper. As shown in this postcard, I believe that we are going though some tough snowstorm like times... remember those days at MIT when we had snowstorms, we used to go out and ski and throw snows when classes were on halt. We should take it lightly and try to weather through this storm with a small sense of humour just like what you did. Listen, I work for a Canadian Bank called Royal Bank of Canada and we are rather immune so if you would like to shoot me your resume, I maybe able to help. FYI, we are hiring especially in the far east!
Investment Banker For Hire: The Oracle of New York
You may have seen the investment banker Josh Persky on one of the tens...maybe hundreds of news pieces done about him...as the MIT grad hits Wall Street handing out his resume looking for work...wearing a sign saying "Experienced MIT Grad for Hire" hanging over his suit jacket. We believe his story itself is kind of an economic barometer, and certainly one that can reflect on the trajectory of thousands of out of work bankers in New York City. So we will present, once a week, the "Oracle of New York, " from Josh's blog, which is syndicated here by permission, and which can be seen daily at www.oracleofny.com
Here is the first installment.
Goldman Sachs, GE and the Oracle of Omaha
By Josh Persky (Currently in Omaha.)
The Oracle of Omaha (Warren Buffet) has added Goldman Sachs and GE to his trophy room, the Bailout Bill has passed the Senate, and I had a productive interview in Omaha. Is the worst of the storm passing?
I received the following email from a fellow MIT alumni:
I went to M.I.T.back in the '70s and am in a similar pickle: out of work. (I haven't tried your approach, but I am thinking about it.) Anyway, I thought I'd let you know (if you don't know already) that your picture with the sandwich board appeared in a Chinese newspaper, dated September 7. I'll be happy to send you the tear sheet, if you don't already have it. _Good luck on your job search. My heart goes out to you. I lost my position (as a speechwriter) last January....I am older than you and am having a very hard time.... _Best wishes ( out of work MIT grad)
For an upcoming interview, I was asked to provide the typical steps used to produce a valuation of a bank loan to a private company: 1. Gather and review financial and legal documentation. 2. Note key loan parameters, such as: interest rate, maturity date, type of loan (bullet or amortizing), first or second lien, financial covenants, up-front and other fees, pre-payment penalty. 3.. Note key financial performance parameters: EBITDA, income, margins, cash flow, balance sheet (historic, current, projected). 4. Analyze key financial ratios: leverage, interest coverage, loan to value. 5. Perform synthetic credit rating on company and DCF analysis on loan. 6.. Compare company to publicly traded similar companies. 7. Compare loan to publicly traded similar debt instruments. 8. If the company is distressed, determine the value of its assets. If the company is in bankruptcy, determine probability and timing of recoveries.
