Finance

There’s a very good article by Gillian Tett in the FT today which chides bankers for the murkiness of their world. For the last ten years they have been shielded from view, hard at their arcane business without ever making much effort to explain the workings of their toils to everyone else. '21st century bankers', she writes, 'have been acting like a Blackberry-toting priestly class that assumed that only people who spoke the equivalent of advanced financial Latin should be allowed to attend mass'.

At MT we’ve had good open relations with retail banks over the years – Barclays, HSBC, Lloyds all allowed us good access to their bosses and those in the ranks. But the investment banks were always very different in their approach. A good deal snootier. Whenever during my time at MT we have made attempts to get in touch with investment banks, about any number of subjects, calls were rarely returned. Even if our intent was friendly rather than in the form of awkward questioning, they never wanted to know. They were closed institutions as far as we were concerned. Simply far too busy with their lusty embrace of Mammon - which began when they reached their desks at 7am and went on long into the night - to bother with the media generally. Ok, so MT is a general business publication and they must have had some sort of relationship with their specialist correspondents. But it left a bad impression.

Even before the events of the credit crunch and Black September, the world of high finance was a communications disaster, a PR man’s bad dream. You cannot afford to be mute in the modern world, however well it all appears to be going and however much cash you are raking in. And after the right royal mess they have got us all into, they have some explaining to do. The fact that Joe Public never fully understood what they were up to is one thing. That’s a solvable communications problem.  The even more terrifying emerging truth is that they didn’t really fully grasp the implications of Faustian fooling with complex derivatives themselves. Or maybe they did and knew it was all going to end in calamity, but didn’t care as long as they filled their boots first.  

I doubt if they will be able to carry on behaving in this way. In the future they will need to be far more transparent and far more patient when they explain a) what a collateralised debt obligation is and b) whether they are a very good idea for anyone in the long term or should just be placed with spent uranium in a deep, dark hole. If they are ever going to regain the trust of the general public, they are going to need to start talking and explaining. Quickly.

In today's bulletin:
Mandy's back - and he means Business
UBS culls another 2,000 jobs
No crunch for card fraudsters
Editor's blog: Shining a light on banking's dark arts
Appealing to emotions, with YouTube