Global wage arbitrage is nothing to celebrate when it impacts factory workers or Wall Street analysts. The standard of living for workers in industrialized countries will decrease as a global labor glut of billions of Indians and Chinese work for less money without health insurance or social safety nets. The only winners will be those whose families have amassed wealth from which to reap rents on capital.

The difference in this case R. Timm is that those now getting the boot were all for the factory workers getting the shaft...so in this case it's just what they deserve.

You know the old saw.

"In Germany, they came first for the Communists, And I didn’t speak up because I wasn’t a Communist;
And then they came for the trade unionists, And I didn’t speak up because I wasn’t a trade unionist;
And then they came for the Jews, And I didn’t speak up because I wasn’t a Jew;
And then . . . they came for me . . . And by that time there was no one left to speak up."
An early supporter of Hitler, by 1934 Niemöller had come to oppose the Nazis, and it was largely his high connections to influential and wealthy businessmen that saved him until 1937, after which he was imprisoned, eventually at Sachsenhausen and Dachau concentration camps. He survived to be a leading voice of penance and reconciliation for the German people after World War II. His poem is well-known, frequently quoted, and is a popular model for describing the dangers of political apathy, as it often begins with specific and targeted fear and hatred which soon escalates out of control.

http://en.wikipedia.org/wiki/First_they_came...

Well S in this case they came for me and everyone said Suck it.

My guess is this outsourcing will just leave more money to divvy up for those who remain. Lower costs will just mean higher profits and larger bonuses for those smart guys not outsourced.

Wow, they're even eating their own now. Let's hope that trend continues and that Wall Street offshores itself to Bangalore!

Nat wrote, My guess is this outsourcing will just leave more money to divvy up for those who remain. Lower costs will just mean higher profits and larger bonuses for those smart guys not outsourced.

This gets at the real point: why should there be such outsized profits and salaries at all in investment banking?

This state of affairs indicates either large barriers to entry or massive market failure.

This is great. The more Indians working on investment banking stuff, the fewer of them working on IT stuff.

I hope that as in the US the Indians working on investment banking stuff also make outrageous salaries relative to IT, that way, they will all want to go into investment banking instead of IT.

This is interesting for a couple of reasons:
- You typically don't have investment bankers coming to the US on an H-1B visa (because there isn't considered to be a shortage of these professionals).
- We have a lot (and I mean A LOT) of IT workers going off to school to get an MBA to switch to things like investment banking. I wonder what this trend will do to that. ($100K + loss of income for 2 years may not be all that attractive anymore!)

The next few years should be fun as the higher paying jobs move overseas.

See the movie "Trading Places".

My view is that your average investment banker has far less skill than the average IT worker. They are just more polished.

This couldn't have happened to a nicer group of guys.

The problem with this is that we are celebrating inequality gaps shrinking due to the misfortune of a group vs. another.

Why is that a good idea?

At the end of the day, free-trade is nothing more than a giant transfer of wealth to the poor countries, and the amassing of the arbitrage gains by the owners of capital.