Oh, Stop The Baracking

Well, I'll have to put aside my discussions on investment briefly, as there has been an interesting development at the bank.

By good fortune, one of the junior team members has just decided to quit. The reason is being kept secret for now, but he was a veritable Lothario despite ears that stick out like dinner plates, and there are rumours he has been sleeping with the personal assistant of a particularly senior MD in synthetics. If that got found out then it was never going to go down well - particularly if the MD was also getting some on the side.

What was more interesting however is how this fits into the impending job cuts here - our Boss announced his departure rather cryptically this morning; that is was his own decision (yeah, right), and mentioning his leaving date was still to be confirmed "pending some negotiations".

From talking to the chap in question who is leaving, this is all about when he can hand over his work, which sounds reasonable enough on the surface. However our Boss is a sly old fox, and is more likely to be delaying the whole process so that our boy counts nicely in the round of cut backs next month. A splendid idea, and at the same time the Boss can avoid making any of those nasty decisions that reduce team morale.

Otherwise I have a couple of sources dotted around in the Bank, one of whom works for global security. They are very useful to know, because as a group they need to be informed in advance when we're about to fire people so they can be ready for the odd disgruntled former banker who might come storming back into the office to vent their views on life, the universe and anti-Capitalism. Global Security's usual tactics these days has therefore been to simply lock the doors on the day of the cull - unfortunately we all know that game now so it is also taken as a sign that something is afoot.

Apart from confirming my suspicions that a cull is on its way "within a month", he also confessed his team had even gone to the length of locking the office doors periodically on other days recently, to try and make it seem more of a usual event! It sounds like they haven't got enough to do if they're wasting time with antics like that, and a few of them should join the exit queue.

Otherwise my highlight news of the day was waking up to find that the new, incoming President, Barack Obama, is taking the time to make sure we bankers are lined up as the sole fall guys for the global economic crisis. In an age of irresponsibility, there is no doubt that the City and Wall Street ought to be hung out to dry. But so too should the governments that steadily reduced the regulatory framework for years to the point where all this was possible. To use a zoological comparison, if the government is an animal keeper and the City a tiger, it's like putting the tiger in an enclosure next to some lambs, with only a low, wooden fence between them. And then blaming the tiger the next day when you get in to find a blood bath (but a fat, happy cat).

And while we're on the subject of personal responsibility, let's have a moment to think of Average Man On The Street and his stupidity in spending far beyond his means for years by borrowing against the value of his house.

In reality, Barack's barracking is a response to 'Bonusgate' - the scandal currently engulfing Bank of America / Merrill Lynch, in which former Merrills CEO John Thain opted to pay his people a fat bonus before the inevitable bad times engulfed the firm. Thain's head rolled quickly enough this month, although BoA made a poor job of trying to stitch him up by pretending they had no knowledge or influence over the decision.

In reality that is a load of rubbish, as Thain made clear in public interviews that could not be convincingly denied by Bank of America. As such we ought to see Ken Lewis (CEO of BoA) on his way soon as well. It's entirely fair given the amount of public money being used to keep the combined bank afloat, and is probably the first signs that the compensation culture of global banking is changing forever.

Meantime for a man who spent his campaign talking about rising above finger-pointing and blame, and focusing on resolving the problems, the President seems to still have had a spare moment to give a mid-digit to Wall Street for all the problems they are going to cause him for the next couple of years. Fair enough.

Doom, Doom & More Doom

Well, it has certainly been an interesting year, with an even more interesting one coming. I am not one to sit around piously lecturing others, but I am sure I'm not alone in hoping that, once and for all, this downturn changes the world's views on personal and institutional responsibility forever.

First of all though, without wishing to point out the obvious, I have decided to start writing a blog.

It's hardly an original idea these days, but after the events of the last six months in particular, I am tired of listening to the press twittering on with its simplistic explanations to a public more than capable of following the detail. And of watching often laughable 'experts' talking about areas in which they largely know nothing about. Perhaps I find it more tiresome than most because I am in a better position than many to understand what has been going on, what is going to happen, and what to do to make money in these tough times. So that's what this blog is about.. and I'll of course update you on what's going on in the world of investment banking throughout - the kind of detail we must never reveal, naturally.

I have worked for investment banks for over a decade, and have escaped the current job "bloodbath" (to quote the amusingly overused phrase used describing any cut) while watching mostly likeable but average colleagues fall by the wayside. That's not to say I'm something exceptional, but I do work hard with the output and hours that make me useful even to my boss. The indications seem ok for me going forwards, helped because I work for one of the world's top investment banks best weathering the economic storm (i.e. it's not effectively nationalised like all the British banks). I suppose many people dream of a job like mine, but for nothing more than the pay.

But I'm far from satisfied. It's not what I want to do in life, and never was. I've ended up here more as a distraction until I can satisfy a long-standing urge I've had since I was 10yrs old to set up my own business and create something more meaningful (at least by my own definition). I'd like to do that rather than retiring as a fat, purple faced banker with a puréed liver, as most of those around me will, having been nothing more than a small cog in a very big machine.

The last 18mths have increased my desire to plan an exit by confirming what I always suspected - that the value our industry offers in providing important services is but a distraction in the pursuit of profits which are nothing more than the transfer of wealth from one party to another.

So that's what this blog is about. I'll give my opinions on current events and news, discuss what I'm investing in with my own money and why, and the latter might be most useful to you as I am absolutely amazed how few people have even an ounce of common sense when it comes to looking after their money. How much you earn helps, but it's amazing how naive most people are with their cash - and that includes my colleagues, hence the number of overpaid bankers in deep trouble now they have lost their jobs.

If you have any comments along the way then please do drop them after a post, and I'll try not to leave too lengthy gaps between updates.