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And Another Thing... Whilst the publicity associated with the issue is unwelcome and untimely, last week’s revelation that a group of banks face a lawsuit over their use of (although it is probably more accurate to say ‘lack of disclosure of’) last look should have focused a few minds on the feedback process being run by the recently-formed Global FX Committee. We need to be clear about this – if this lawsuit is settled or lost by the banks then more will inevitably follow.
And Finally... I am very grateful for the responses to Thursday’s column, ranging from congratulations, through jokes, to guesses as to exactly what event triggered the Cable drop I was talking of. On the latter the favourite was the infamous (and possibly apocryphal) story of the “Carrier Down” message, but I think it was later than that. Either way, to complete my self –indulgent look at my top 10 events from my 40 years in foreign exchange, here are the top five.
And Another Thing... This very week 40 long, long years ago, I walked into a bank in the City of London and was immediately sent to the foreign exchange area. I won’t bore you with the story of how a 16 year old found himself learning about FX, but obviously it was down to my brilliance in every respect! So if my readers will indulge me (you don’t have much choice I am afraid) I thought I would very quickly provide 10 memorable events from that time.
And Finally... It feels like the trend of bankers leaving the industry to start hedge funds could be accelerating with two senior figures apparently leaving to do just that. It’s an interesting time to make a change because while there are plenty of incentives for traders to leave banks, there are just as many challenges in the hedge fund world – albeit of a different nature. The perception is that hedge funds are struggling and losing assets thanks to that under-performance and that may be the case across the industry, however I suspect it’s just a few headline big names that are creating that perception.
And Another Thing... I have to say I am already bored senseless by the welter of emails telling me that if I had invested $1000 in 2010 in Bitcoin I’d now be a millionaire. Some of these mails are from analysts trying to explain the phenomenon and that’s fine, but too many are from people trying to sell crypto strategies to me. Firstly, this seems to me to be a classic case of ‘Harry Hindsight’ analysis – Mr Hindsight being the best dealer in the world of course.
And Finally... Regular readers know that the increasingly blurred lines between retail and institutional FX markets have bothered me for years. Too many customers are unsuccessful in the retail sector and the reputational risk for the entire industry is off the scale. We need to be asking many more intrusive and difficult questions of these firms – for if we do, I think the answers – assuming they are given honestly – will highlight the scale of the problem and help deliver a solution.
And Another Thing... The starting point for this column has to be the observation that, by and large, foreign exchange dealers do like a moan. Let’s face it, we’re a bunch of whingers and the events of the past week – thanks to flip-flopping central bankers – have only reinforced this trait. Are we, however, looking at things the wrong way? Markets undoubtedly adjust quicker to events than they used to, but is there an opportunity for traders in this? I happen to think there is.
And Finally... Does a magic genie do the work of developing the next generation? No, it’s people like you and me and I think it is about time that the industry – and especially the major institutions and other employers – recognise that. Because without the volunteer network – people willing to give up their time to help develop the next generation of industry participants – FX loses its community spirit and that surely has to lead to greater regulation – something few, if any, of us want.
And Another Thing... Today’s column is about technology, speed and the race to zero. It also quotes Top Gun – a first in the pages of Profit & Loss – and in reality it does actually care that much. After all, do you pick sides when the National Football League owners (the billionaires) go up against the NFL players (the multi-millionaires) over money? Speed of technology is important to a certain extent, but there has to be a point when it becomes largely irrelevant to the most important people in the FX industry – the customers.
And Finally... The past year has seen me become increasingly irritated by platforms answering my call to help police bad behaviour in the Global Code era by saying either it’s not their responsibility or it’s an impossible request - so here's one area they can do something about. There are reasonable reasons for asymmetric price improvement data and - at a stretch - for asymmetric last look policies. But asymmetric response times? That's a whole different matter and something needs to be done now.