Saturday, 16 August 2014

FX Employee Survey - How's life in the trenches?

I thought it time to give my old profession a chance to air how they feel about the state of the jobs market in sell-side FX these days. We have all had to fill in work related satisfaction surveys but we all also knew that they were not as anonymous as they promised (how else would HR know to send you an email reminding you that you haven't filled it in). This IS completely anonymous, no log-ins etc. which actually makes it less reliable as anyone could fill it in. But I trust folks to be honest.

I have set this up so everyone can see the collated results/answers as they come in, so the benefit of doing it will be to see those results. Please pass on to anyone in the industry so we can get a representative feel of what the mood is like.

The analysis of the responses IS HERE

Friday, 15 August 2014

Innocent Aid - Secured.

If I were Putin I‘d drive a huge convoy of aid trucks around the country gathering, like the Pied Piper, moral support along the way. The longer they parade, the higher the status they gain as humanitarian and morally good. They would be packed with bona fide aid materials, devoid of any military equipment (as this is truly aid) and the nations of the world would be allowed to fully inspect them to rubber stamp the validity of this humanitarian action.

Then I’d drive them into Ukraine to provide succour for the suffering innocents. However to protect this saintly mission security support would naturally have to be provided (as we can all see, this is a very violent environment) to protect not only the aid trucks but also those receiving it. Perhaps a tank or two, or three per truck. Well, you can never be too safe.

An Aid truck and its logistical support

I then split up the convoy deploying individual trucks of aid, together with their own protective force, to wherever fighting is most intense as obviously that is where aid is most needed. Once there, the truck’s escort of security will do its best to restore peace so that aid can be distributed. Obligingly the rebel side would desist from action leaving the only potential aggressor as Ukrainian forces who now have the choice of desisting or carrying on the aggression only to be countered by the Aid trucks security assistance. If the Ukrainian forces desist then naturally it would make sense for the aid trucks to push on to extend their aid services to others, Any aggression against the aid truck being swiftly dealt with by its protective swarm of T-90 battle tanks and air cover. Of course any resulting casualties on the Ukrainian side would need further aid thus justifying a further push west.

If the aid trucks were to stumble in their purpose then they would swiftly be reinforced by the Airborn Special Nun Service meting out their own form of moral rectitude.

Who could possibly morally deny this humanitarian aid to those who deserve it?

Monday, 11 August 2014

The Day the Earth Stood Still

I saw the remake of ‘The Day the Earth Stood Still’ on TV over the weekend. I don’t know why, but it was just on and I got hooked working out if Mr Keanu Alien Reeves was going to punish the human population for messing up the planet by wiping them out or let them off because a single mum and her twatish kid had shown him that humanity is not all bad.

Unfortunately he let the human race off with a second chance by effectively confiscating their mobile phones, or rather making all electrical things fail. A trick I have tried myself to the extent of putting the family router in the boot of the car and driving to work with it in an attempt to leave the holidaying and fighting kids looking for non-internet activities to entertain themselves whilst I was at work far enough away not to hear their protests. Unfortunately their mother could and I had to do the cowardly thing of pleading that I had indeed removed it temporarily and couldn’t remember where it was and perhaps the kids could play ‘seek the router’ for the rest of the day and no, there was no way I would have maliciously driven off with it leaving my dearest in the lurch with the howling horrors.

So the relevance of this to markets? Little apart from the way that Keanu Alien was planning the demise of the world by unleashing a plague of micro-insectbot things that consumed everything in their path in very tiny increments but very fast. A bit like sand blasting. Which is, in my jaundiced eyes, pretty much what we have with the markets. Lots and lots of bad things that are overloading the immune system and causing us to go to bed with some ibuprofen, hide under the duvet and hope we feel better some day rather than being devoured and recycled by some horrible plague of bad news.

It"s all very 1970s -

Ebola - It all came rushing back when the dreaded word Ebola hit the screens this year. I am old enough to remember it when it first appeared when I was a child in 1976, watching the news and hearing about this incurable dreadful unstoppable disease. Though my mother, as a very sensible doctor, assured me that its very lethality was its weakness, it gave me nightmares for weeks. Yet Ebola did eventually creep back into its darkest african cave and I though that was that. But here it is again and this time it’s getting out. I hate to say this, but my only recent experience of epidemics has been playing the ‘Plague’ game on my phone. Which all seemed great fun at the time but I predict its sales have crashed over the last month as it is now in the least possible taste. But I am hoping, probably at complacent levels, that the latest bout of Ebola burns itself out again.

Middle East- The Middle East and oil shock of the 1970s was a fundamental game changer to the nature of energy supplies and a jolt that showed that country's economies could not be considered nice little experiments for the incumbent political party to inflict upon their guinea pig populations. Globalisation was real and had to be considered. - FRANCE! FRANCE! FRANCE! CAN YOU HEAR ME FRANCE? This is your problem NOW!

But war in the Middle East is back again. It never seems to die but this time it is unpredictable and uncontrollable because, just like those microbots in the film, it is a swarm of killers only programmed to do one thing. Kill anyone who isn’t them. Unfortunately they don’t have a Keirnu Alien to switch them off.

The Gaza situation is not only dividing the Middle East it is dividing Western nations. As the multi-ethnicity of the world's nations has expanded there is no longer that national feeling of them and us, Okokok American readers aside, where of course 'them and us' is at the bedrock of rallying calls at every level of life, sportsfield, corporate identity, investment bank slavery and finally foreign policy. But European nations are seeing local protests as their populations divide along internal lines that simply wouldn’t have been there a hundred years ago. The dangers of the Middle East are apparent now on city streets across Europe and it leaves governments in a quandary as to how to handle it with them ending up having their decisions pilloried by a good chunk of the population whatever they do. Western governments are doing their best not to get dragged on to a side and if they do, they have to be sure that the enemy they chose is definitely the enemy in most peoples eyes and that the supported side is not as bad.

Hypocrisy is evident everywhere as the the triggers for support come only when humanitarian thresholds are breached - when things get so bad something has to be done. Gaza is a case in point, the fleeing Christians in Iraq another. This sort of thing has been going on at a smaller scale for years but it is now judged too bad to be allowed to continue. But to hear Obama say “The US can’t stand idly by when there is this level of human suffering' does lead one to ask what happened or rather didn't happen, with Rwanda, Darfur and the original Syrian refugee camps which incubated the militant hordes we now see streaming into Iraq.

We could look at the this binary response by governments to vicious uprisings a bit like binary options. Nothing .. nothing .. nothing .. nothing Kaboom, the trigger being its own public’s horrors at what they see (Rwanda by the way wasn’t that visible, it was only when journalists went in afterwards that the true horror was seen. Pre-mobile phone camera apps plus poverty I suppose). But the binary function is a game that all the problem factions play to. Niggle away, spread the network, infiltrate, manipulate and do horrendous things on a big enough scale to take power but small enough not to trigger a reaction.

However the latest horrors in the Middle East appear to be trying something new. Being so absolutely barbaric that they cannot be ignored and appear to actively want the morals in the west to be so shocked that the west is sucked in, at which point, i assume, they hope that those nations getting involved are split internally about what to do.

US policy so far on every level has appeared to be ‘let them fight amongst themselves’ and whilst they have stopped short of fomenting war, there has been very little action in the way of progressing peace. Either in the Middle East or with the waking Bear.

Let me ask one last question before we lead the Middle East. What is the difference between Tony Blair as Middle East envoy and a banker? A banker loses their job and hands back their pay and is never allowed to work in that field again when they leave the place in ruins.

The Cold War - another one of the1970’s nightmares. It is strange to think that there is a whole generation who have no recollection of it and haven’t had the nightmares that I did involving mushroom clouds on the horizon, lost parents and all the other horrors of childhood terror.

To be honest I’m a bit annoyed at myself. After raising flags in this very space as to my concerns over Russian policy and how it wasn’t going to stop at Crimea, I let myself get reassured by (surprisingly mostly American) friends that the Russian economy was in a mess and there was no way Russia could afford a spat with the West as they need the energy revenues. As it is this spat is more like a slow insertion of hot steel than a slap in the face followed by a swift make-up. Who is Russia’s new energy friend? Why of course the Chinese, never fussy about the morals or methods of the supply of their raw ingredients/materials (see Africa). China meanwhile is taking the opportunity to test their boundaries in the South China Sea.

It's all very 1970s out there and all we need to complete the picture is a hefty dose of inflation and a few pares of flared trousers. Perhaps if we follow this into the 80s the next thing we would see is a rise of a radical right (Thatcher and Reagan) as a reaction to ineffectual social and international policy. Errrr.. hang on.

So where are we? It’s the 1970s, we have a swarm of microbots devouring the middle east and we have a swarm of bad news taking over the markets. None of it is big enough to have triggered a full scale rout, but each little nibble undermines the asset next to it and we see a self feeding sell off in risk.

Yet here is where I digress from all the points above.

The junk bond market may be looking as shaky as anything and Bund yields may be doing a Baumgarten (the jumping out of a ballon in space man) and equities may be overpriced and the Middle East may be blowing up and the Cold War may be returning and religious based riots may erupt on the streets of Europe and Portuguese bankers may continue to lie through their teeth and UK house prices may be going to crash and the US may be about to raise rates and Ebola may be going epidemic. But, but, but I think we've had the panic. That's it for now and..

I'm still long equities.