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Wednesday, January 14, 2015
Investment Banking: Then, Now and the Future
The future of investment banking will be a much more open future if the current crop of banking experts has anything to say about it. With the world still recovering from the 2008 banking and housing crises, the investment banking world has had to make many changes in order to remain relevant in the financial industry. I will leverage my years of experience in the industry, to deliver you a quick rundown on everything you need to know; about the Investment Banking world.
In the past, investment banking prided itself on exclusivity. One of the main selling points to top clients was the belief that the investment banker was giving away exclusive services that were not available to rivals with less money or influence.
This was a system that relied on a closed system in order to work. There was a great deal of secrecy involved, and eventually, the politics became too complex to justify in a world of virtually no privacy. Nevertheless, bankers tried and were moderately successful until 2008.
Investment Banking: Now
The world of investment banking has made many updates based on political and economic concerns. For the most part, investment banking is a much more open and inclusive world - giving me a great sense of inspiration going forward.
In order to regain the trust of the public that finances its trades, investment banking has had to open itself to them. Many of the top investment banks have lowered their financial minimums for entry, creating programs for upper-middle-class and even middle-class individuals with expendable income rather than just providing services for the wealthy and connected.
What investment bankers have found is that the middle class is actually much less paranoid of investment banking than was once thought. This has many implications for the future of the industry as a whole.
Investment Banking: The Future
In the future, successful investment banks will conduct themselves like businesses and many other industries – competing for business on a much more commercial level. Many of the most forward thinking investment bankers have already put themselves ahead of the curve by putting themselves on YouTube and establishing personal blogs that explain the ins and outs of investment banking to the average person.
This new and more open culture will certainly endear investment bankers to the public at large again. Although investing is now within the reach of anyone who wishes to open a Scottrade account, many people prefer to leave the details of making money to the professionals. Investment bankers that give their attention to the new middle-class audience that is looking to build wealth will certainly have success in the future.