World Energy Production/Consumption

Very nicely presented data showing worldwide production and consumption of energy. Here it is.

Exodus

First, analyst and research jobs. And then senior managers.

In a commodity business, the only way to survive is to have the absolute lowest cost structure, as prices will keep spiraling lower till only the cheapest player survives.

E.g. Walmart vs. Sears, KMart, family grocery stores

A similar effect in banking as well, as more routine functions automatically seek out the lowest cost base, especially in the face of hideous market losses.

The only way you can price higher is by possessing specific skill/knowledge that is not easily replaceable or substitutable. Thats why MDs got shipped and not their jobs :).

Spoilsports

Excerpt from the Economist.

Spoilsports
In their eyes, we were not earning money for the bank. Worse, we had the power to say no and therefore prevent business from being done. Traders saw us as obstructive and a hindrance to their ability to earn higher bonuses. They did not take kindly to this. Sometimes the relationship between the risk department and the business lines ended in arguments. I often had calls from my own risk managers forewarning me that a senior trader was about to call me to complain about a declined transaction. Most of the time the business line would simply not take no for an answer, especially if the profits were big enough. We, of course, were suspicious, because bigger margins usually meant higher risk. Criticisms that we were being “non-commercial”, “unconstructive” and “obstinate” were not uncommon. It has to be said that the risk department did not always help its cause. Our risk managers, although they had strong analytical skills, were not necessarily good communicators and salesmen. Tactfully explaining why we said no was not our forte. Traders were often exasperated as much by how they were told as by what they were told.

Why managing risk is hard when traders are pushing for the next big deal and big bonus, regardless of the consequences.

Result : Traders take home big bonus, bank saddled with garbage with shareholders paying the ultimate price.

Vacation!

Out and about for a week and a bit,
A little bit of London, in Stockholm for a bit,
Paris, je t'aime,
And on Chamonix I make my final claim,
Up a hill, down a valley,
And don't worry if the index is going to rally.

ROTW

Read of The Week : Oil! - Upton Sinclair

The High Price of Free Accounts

I knew I was getting ripped off.

http://www.economist.com/world/britain/displaystory.cfm?story_id=11750886

In summary:

You earn like 0.5% on your balance in your current account. The bank cooly lends out that money at 3.0% (more when interest rates are higher), and pockets the difference. Makes you want to start your own bank.

Don't you think..

..summer is fun? So stop reading this blog, go out there and do something. Unless, of course you are in the office, in which case you should continue to read this blog and procrastinate on work. Or you are at home, late at night, which means you should go to sleep, get up nice and early, go for a jog in the early morning sun, shower and read the newspaper to piping hot coffee. Or, you might be in the Southern Hemisphere, in which case it really doesn't matter because you have nothing else to do. Actually, you could go skiing.

Does anyone have a job?

Picked it up from Dealbook.