L8 Financial Markets Flashcards
Author?
Karen Ho - ‘Wall Streets Orientation’
- Case study of NY financial market
- Performed doctoral research as post-Grad at Princeton
RISK AND UNCERTAINTY IN THE MARKET? 1)
1) The culture of the market is to move risk away from the consciousness of the firm onto the shoulders of the financial analysts.
- The market is volatile; this vitality is placing down the hands of the analysts… especially with high turnover or market
- It seems more like coercion than delegation
RISK AND UNCERTAINTY IN THE MARKET? 2)
2) No mechanism of correction/reflection, which creates an unstable business environment
- Responsibility for a deal that fails can be moved to the hands of junior analysts
- They become accountable for all problems
- Ho: employee condemned for minor error on powerpoint
RISK AND UNCERTAINTY IN THE MARKET? 3)
3) The work consitutites of “gruelling hours, no sleep and limited days off”. Risk of loosing social relationships.
- Harvard Grad Morgan Stanley linked it to slavery.
- Advised to be single and live far from family
RISK AND UNCERTAINTY IN THE MARKET? 4)
4) loose their AUTONOMOUS CHOICE
- Workers have no option but to work and accept the decisions of those more senior.
HOW DO THEY MANAGE RISK/UNCERTAINTY? 1)
1) Risk is INHERENT, but is micromanaged internally by ensuring there is logic of hard work and smartness that corporations claim to be natural
- Installed from an early age - they believe this is a minimum requirement for this line of work.
HOW DO THEY MANAGE RISK/UNCERTAINTY? 2)
2) They accept risk with the illusion that they will progress
HOW DO THEY MANAGE RISK/UNCERTAINTY? 3)
3) Analysts deal with daily risk of having to prove they are hard working by staying late, working long hours etc.
HOW DO THEY MANAGE RISK/UNCERTAINTY? 4)
4) Structure of the building internalises the risk
- idea that money is blind they argue through this that there is no segregation but in the business can visibly see the risk and inequalities.
