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Sunday, September 21, 2008

As the Lehman Brothers fell

The crisis in the financial markets has given everyone something to talk about. Lunch time discussions about the latest sale at Marks and Spencer has been replaced by themes like “adverse selection” and “moral hazard” as admin, HR and software professionals, try to explain the origin of crisis to other colleagues. During the last week, we have realized that there is a Paul Volcker within each one of us. And while many teenagers worldwide initially took Lehman Brothers to be another band on the lines of Safri Duo, Twisted Sisters or Allman Brothers, they soon realized that this was not as significant as another lip synching scandal. All the same, politicians in all countries other than the USA dashed for the microphone to pronounce that the crisis won’t have any effect on their country even as the stock indices in these countries fell as they were speaking.

The television screens were filled with sights of ex-bankers wearing tees and jeans clearing out of their office premises. But many people watched these sad shots with great pleasure. Many of us MBAs are now feeling extremely happy to have been rejected by these banks. Some of us have been earnestly calling up batch-mates or friends from the finance industry, snubbing them at the pretext of showing our concern for their careers. People constituting the sub-prime segment are happy to have taken their revenge on the finance industry for calling them sub-prime. The Detroit mechanic is happy that the proverbial banker who had been asking for the mechanic to be laid off as part of cost cutting has become a victim of cost cutting herself.

But the finance industry professionals do deserve a moment of silence. Long proponents of free markets, their sustenance is now dependant on huge government dole outs which means that the Panini sandwich has been replaced by the one dollar Mcburger. As a result of this shift in diet pattern, “I am a banker” has lost its place in history as the best pick-up line ever. Another category of people significantly affected are the MBA students who are graduating this year many of whom have already sold their book on “Options and Derivatives” to the paper recycler. Yes, distress sales are happening even in such unexpected quarters.

Given such varied emotions, the media has rightly devoted all its attention to the crisis, that too in a week when over 20 people died in a stampede as they lined up to get $4 during a charity hand-out by a wealthy family.So when will the finance industry come out of this mess? That would be quite soon as the Gujarat police is probably already on the lookout for Muslim suspects who can be blamed for the crisis.

1 comment:

cheesyskepticism said...

well-written post, as usual.

even among undergrads here in NUS, there's an unsaid satisfaction with the prospect of usually-gloating finance majors not getting the best jobs that we non-finance people can only pine for. crab mentality.