On Friday, May 21, the Julis-Rabinowitz Center for Public Policy and Finance hosted a Zoom panel of young alumni in finance as part of the virtual programming for 2021 Princeton Reunions. The hour-long session, moderated by Hamza Chaudhry ‘19 and Julia M. Zielczynska ‘19, featured alumni who have taken diverse paths into the financial sector and addressed several topics for alumni, undergraduates, and economists alike.
Five panelists, ranging from the classes of 2011 to 2019, participated in the discussion. Katy Boettcher is a vice-president at Ara Partners, a global private equity firm specializing in decarbonization. René Chalom ‘17 is a Ph.D. candidate at Columbia University and worked for the Federal Reserve Bank of New York for two years before starting his doctorate. Sara Diressova ‘18 is a research analyst at the Federal Reserve Bank of New York. Ryan Chavez ‘19 is an operations analyst at Hatch, a digital-first banking startup that provides services for small businesses. Sarang Gupta ‘19 is an analyst at Briarwood Chase Management.
The panel began with a discussion of the trends common to the field of finance today, especially in the United States as the country accelerates its recovery from the COVID-19 crisis. The panel highlighted the effect of the epidemic on different aspects of economic and financial systems, from the labor market to savings rates to wealth inequality. One topic that quickly took center stage? Inflation.
Diressova (who noted that all opinions were her own, and not that of the Federal Reserve), said that at the Fed, “the effects of COVID [are] still our bread and butter right now.” Inflation, she continued, “is really top of mind for us. Figuring out if this inflationary spike in the data–is it temporary or is it going to last for a while?”
The panelists stressed the importance of the effect of inflation expectations on inflation itself and vice-versa. “Inflation begets inflation,” emphasized Chalom, giving an example of how laborers–anticipating inflation–could push for higher wages that then drive up prices, creating a self-fulfilling prophecy. “All it takes is a little bit of jitter to spark a big run,” he added. Diressova echoed this point, citing the evolving opinions of policymaking experts as evidence for the uncertain future of inflation rates. “Larry Summers was one of the main proponents of the idea of secular stagnation,” she pointed out, but now Summers is making headlines for posting op-eds with headlines like, “The Inflation Risk Is Real.”
The conversation progressed from inflation to a discussion of the effect of COVID-19 on consumer behavior and especially on the savings rate. Panelists were skeptical that the latest economic crisis would meaningfully change Americans’ savings rates. “It doesn’t seem like people have discovered the savings bug all of a sudden,” said Gupta. “I think consumers and corporations having been bailed out this time are likely to continue spending as extravagantly as they did before, if not more,” he later added.
Finally, the conversation turned to advice for current students interested in pursuing a career in finance. For those interested in pursuing higher education, it “involves a bit of persistence and delayed gratification,” said Chalom, who encouraged current students interested in such a path to take more classes in the subjects of Math and Computer Science. “Network and take risks,” encouraged Chavez, drawing on his experience at a startup as an opportunity to work on a different set of problems and join a different culture than would be possible within a large investment bank. Boettcher advised current students to draw on the Princeton network as well, and also to research the different possibilities that exist within the sector, emphasizing the vast differences between them. “There is a diversity of functions within finance,” she emphasized. For those interested in private equity, she said that prospective applicants should be careful to research the amount of runway at different firms to better understand whether “continued career opportunities” might exist.
Read about the other JRCPPF Alumni Forum, “Cryptocurrencies and the Future of Fintech,” here.