Something I get asked quite frequently is why I have such a dislike of last look, after all during my trading career it barely existed and anyone who did regularly “drop” others (that’s reject in modern day idiom) soon got a reputation they didn’t want (or the threat of a visit from some very “tasty geezers” fond of carrying crowbars from a spot broking desk!) I accept my dislike is mainly aesthetic, but last week I was last looked by Malaysia Airlines and it’s a very unpleasant experience!

Although this is a story of me feeling ripped off and treated poorly by an airline, there are so many parallels with the FX market that I couldn’t resist sharing – nor can I resist highlight how in one area I am determined to be different to the vast majority of FX clients.

So, what happened? Well, I was in the UK on an extended business trip which was to take in Profit & Loss’ conferences in London and Frankfurt. The pandemic hit and, due to family reasons as much as anything else, I decided not to fly home earlier than planned. Showing the judgement for which I was famous during my trading days, my scheduled return in May was cancelled thanks to lockdown, as was a rescheduled flight in June. I write this from 18 weeks on the road and counting,  and I continue to live out of a suitcase, which may explain why I am a little grumpy – I am WFSEH, working from someone else’s home!

Malaysia Airlines finally started flying to Australia again but could not find me a flight in August, but they did have availability in early September, which I naturally grabbed.

It was at this point I was last looked and a disclosure was (metaphorically) waved in my face.

Yes, I could have a seat for my return in September, but the seats available were on a different price scale to that of my original ticket, which was a promotion, and therefore it would be another A$ 3500-odd. I asked about seats in my ticket band and was told, “actually there are none”. My choice therefore was to continue to live out of a suitcase longer than the six months I would already have done so, or bite the bullet.

The parallels with FX are obvious. I was lured in by, and dealt at, a very attractive price with the airline for a return ticket, but when I went to complete the deal it was rejected and I was presented with a new price that will cost me money (I don’t think airlines, like many LPs, have heard of positive slippage). When I complained I was very politely informed that the Terms and Conditions allowed the airline to do exactly what it had done. In other words the disclosure basically said, “we can do what we want and this is us telling you that”. There, in a nutshell, is why we should heed warnings from the Global Foreign Exchange Committee about the caveat emptor disclosures.

My response to this is simple; economic sense dictates that I fly home and accept the reject this time. But this is where I differ from the vast majority of FX clients. I have a choice of airlines to fly from Australia around Asia, Europe and the Americas, just as they have an array of LPs willing to provide them with a price and credit. I am going to ensure that only as a last resort will I fly with an airline that has undermined the relationship and agreement I thought I had with them (and to show there is no limit to my pettiness, I was let down – repeatedly – by another airline in 2008/2009 and haven’t used them since!)

My attitude differs dramatically from how clients react to repeated rejections, however, they roll over and ignore it, whilst also complaining about the practice whenever the subject is brought up in discussion. Having experienced first-hand, what it feels like to be last looked, instead of sympathy, I have a growing contempt for their attitude. Every time there is a reject a question should be asked (and I acknowledge that reject messages have been enhanced in recent years), and if an LP is rejecting you, go to another one. The original LP will soon miss your business and if enough consumers are brave enough to take this course of action, which may involve, as it may with me as a frequent flyer, dealing on a slightly wider spread occasionally, the end result will be weak LPs, who hide behind last look to shield their inabilities, struggling to survive – which will be healthy for the market overall.

So, here the lesson endeth, but the message should be clear, take action when you are being last looked…and don’t fly Malaysia Airlines unless you have to!

Colin_lambert@profit-loss.com

Twitter @lamboPnL

Colin Lambert

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