Morning Coffee: What really happens when you make partner at Goldman Sachs. Paris, Frankfurt bankers will want to move to London

The election of the Goldman Sachs 2024 partner class may be of negligible importance alongside the election of Donald Trump, but if you're one of Goldman's 95 new partners, it's a whole new world. 

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Not only are you now earning a $950k salary, instead of the $400k salary Goldman pays its managing directors, but you also have - in the words of Feroz Khosla, Goldman's 35-year-old new partner, talking to Business Insider, a new responsibility that is "deeper, heavier" than before.

Goldman likes voice communication, and your elevation into the partnership is unsurprisingly communicated not by email but with a jovial call from the likes of John Waldron, Goldman's president and COO, who will say something like, "I look forward to calling you my partner."

Thereafter, it's a whirl of vintage champagne and cakes and celebratory meals. Khosla, who works in corporate derivatives with treasury clients, said his wife was invited to the meal, during which someone leant over and said, "Welcome to the family." As an Indian, Khosla said Goldman Sachs has literally been like his family since he began working there in 2010, but that his wife and actual family contributed to his achievement too. His parents laminated times tables as place mats and pushed his education, and his wife is well-used to cancelling engagements so that he can work. 

When Khosla got the call from Waldron, he therefore says he congratulated his wife on his promotion. He thanked her and thanked his parents. He also planned to thank everyone in his department, 'from junior analysts all the way up to other partners.' 

At some point, though, he'll be left with the "deeper, heavier" responsibility of his new title. Khosla told BI he plans to shoulder this burden with the help of energizing movie playlists, which he listens to while running. 

Separately, after all the excitement about moving to Paris - and to a lesser extent, Frankfurt in recent years - Financial News notes that the removal of the bonus cap in the UK has the potential to make London a lot more appealing this year. “My senior bankers in Paris or Munich will be outraged if their London peers are blowing the lights out with bonuses.” “My senior bankers in Paris or Munich will be outraged if their London peers are blowing the lights out with bonuses,” one banker tells Financial News. Another suggests that bonuses in London will now be comparable to America, although this implies that salaries in London will fall to a level similar to America, too.

Meanwhile...

“Banks are back. Trump wants to ‘build, baby, build’ and that requires a lot of financing.” (Financial Times)  

DCM bankers are hopeful that they'll get to finance all the new deals. But valuations of possible targets are high: equity markets surged following Trump’s win. Buyers typically don’t want to pay the top price for a company. (Bloomberg) 

Cantor's Howard Lutnick is building Trump's team. Trump likes to hire attractive people and wants their photos so that he can remember their faces. (WSJ) 

Elon Musk's personal wealth is up $32bn since election day. (Financial Times) 

Hedge fund that were shorting Tesla have lost billions. (Bloomberg) 

Hedge funds have been buying bank stocks at the fastest rate in three years. (Reuters) 

Merger arb hedge fund managers have been losing their jobs as mergers were cancelled . - Ed Cooper and Laurent Pujade-Lauraine at Millennium Management, Eric Fritz at Schonfeld Strategic Advisors, Adam Schwartz at Balyasny Asset Management and Neel Gupta, who worked at Soros Fund Management, were all cut this year. Now that mergers are less likely to be blocked under Trump, they're all likely to make a comeback. (WSJ) 

Hiring is back in Hong Kong. Citi Securities alone added 115 people between June and October. (Bloomberg) 

HG, Ares Management, Permira and others are hiring private bankers to land distribution deals with major private banks. (Financial News) 

Citadel hired 38 year-old Nabeel Bhanji, who spent more than a decade at Elliott Management in London. (Bloomberg) 

Brevan Howard wants more emerging markets PMs. “We have a great group of people in emerging markets at Brevan Howard, but emerging markets is a wide universe and there is more we can do in the space, so I’d expect we will see some growth in the team.” (Financial News)  

The new client you want is M42, an Abu Dhabi investment firm. “We continue to screen about 50 opportunities on a monthly basis to see what will really complement our strategic plans going forward. We have the appetite, and there’s a real hunger for growth.” (Bloomberg) 

Bob Foresman, a senior investment banker at UBS, says Bill Hwang of Archegos is a great guy and "one of the most generous people I’ve ever encountered...I have personally seen over and over again how Bill only ‘cares about money’ insofar as it allows him to support worthy ministries.” (Bloomberg) 

Rich Ricci, the former Barclays banker, has supplemented his wealth with the sale of Aquis, a challenger stock exchange that provides small companies with access to capital markets, which agreed to a takeover by Zurich-based Six Swiss Exchange Group in a deal worth £194m. Ricci made £16m. (Telegraph) 

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