You know, that credity thing
Posted December 13, 2008on:
With apologies to a London cab driver, what do I want to know about the credity thing?
I’m very interested in understanding the financial crisis, the meltdown, the credit crunch, or whatever you want to call our current predicament. There is a lot of talk about managers’ bonuses and the USD70 cost per hour for a worker who makes my car (is that a lot?), and surprising little talk about the role of legislation and the culpability of Company Directors.
I would like to know a lot more about the cost break downs in companies currently in the spotlight, and in our vision for Britain in the next 50 years. Who will do our work? Who will deliver our letters and our babies? What work do we want to do and what is it’s price on the world stage? I would like conversations about all these issues.
Curating clear presentations
For now, I am collecting straightforward descriptions of the crisis and posting them on one page.
Many of you may be familiar with Peter Fryer’s work on emergence in organizations and his concept of Trojan Mice. If you don’t subscribe to his monthly newsletter, you should. It’s packed with quotations and links and if you read nothing but his newsletter, you would be well served.
In December, Peter included a magnificent description of SHORT SELLING which will help you explain it to anyone, regardless of their education level.
It’s good for a weekend smile. Here it is.
Once upon a time, in a village, a man appeared and announced to the villagers that he would buy monkeys for £10 each. Seeing that there were plenty of many monkeys around the villagers went out to the forest, and started catching them. The man bought thousands at £10.
As supplies of monkeys started to diminish, the villagers ceased their efforts. The man then announced he would now buy at £20. So the villagers renewed their efforts and started catching monkeys again. Soon the supply of monkeys diminished even further and people started going back to their farms. The man increased his offer to £25 and the supply of monkeys diminished to the extent that it was an effort to even see a monkey, let alone catch one. But the man now announced he would buy monkeys at £50!
However, since he had to go to the city on business, his assistant would now buy on his behalf. In the absence of the man, the assistant said to the villagers: “Look at all these monkeys in the big cage that the man has collected. I will sell them to you at £35 and when the man returns from the city, you can sell them to him for £50 each.” The villagers thought that was a great idea so they collected all their savings and bought all the monkeys.
They never saw the man nor his assistant again. But they had plenty of monkeys Now you have a better understanding of how the stock market works.
UPDATE: For an HR Managers perspective on the Recession, I have written a summary on a new post.