In the public interest
The financiers are ruling our world.
Business is a different language to civil societies across the world. When you work in business the language becomes the narrative and shape changes your world and the disconnect is not apparent as ‘group think’ reinforces narratives that are comfortable in business as usual. The client is who is served not the civil society, yet the global population are impacted extensively by mergers & acquisitions, public assets sold to private sector actors and the business narrative dominating what is valued.
Data today is the new gold and now AI and data gathering becomes the ‘new normal’ in business speak again, within narratives always mindful of market movements, profits and career prospects. Many are not free to speak given their roles.
The interview is found here https://markets.jpmorgan.com/ scroll down until you see the above discussion. It is between Gurps Kharaud who is the Global Head of Equities, Digital Markets and Rui Fernandes who is head of Market Structuring. They have been colleagues for over a decade.
I decided to just take a few notes as they talked to get a feel as the disconnect between finance and the global civil society widens as all keep moving forward untouched by the public impact of decisions made on the trading floor and increasing digitisation disconnecting people from a ‘felt experience’ as they view the world through excel spreadsheets, yields and return on investments as if this is the world, it is not, It is their world.
Just for the record from my perspective I have worked in the City of London in a minor role but amongst the financial analysts with banks of computers. I had just finished my economics degree. I was Australian and temped in London. So it was an insight as I evaluated their world on the floor.
I will add comments.
Gurps: Equities background always been in a structuring capacity at JP Morgan. The Firm runs structuring across markets, creating more innovative products across full range of markets. Complete, global and at scale. They is always more innovation. Ever increasing degree of customisation for product and solutions for clients. They build platforms and tools. Meeting people it is a fast world of capabilities.
Immediately I recall The Firm.
Rui: Meeting people, products, vast world of capabilities – product, geographic, client type, learning a lot having fun. Working on priorities.
What are priorities? Do these coincide with the public interest?
Gurps: First memory on the trading floor?
Rui: First experience – joined 2007, lot changed, back in 2007 came to the building in London went through HR induction. Got into the elevator there was a man in the elevator, both said hello. He had an aura. Jamie Dimon. That was a great introduction.
Jamie Dimon is Chairman of the Board. https://www.jpmorganchase.com/about/leadership/jamie-dimon
This jumped out: He was named President and Chief Operating Officer upon the company’s merger with Bank One Corporation on July 1, 2004. Dimon joined Bank One as Chairman and CEO in 2000.
I then saw ‘Greed is Good’ and the admiration of young men for those rich and powerful. Greed motivates people to do things they would not choose. This speech underscores the public concern about indoctrination in money as success rather than serving the community. We are at a turning point, what do you choose? This has implications for children, grandchildren and the ecosystem.
Gurps: My first interactions of trading floor – wall of noise. People shouting across the desk. Walk in as a student from the library, noise, things changed.
The floor seems exciting which attracts young men and the competition of winning. Pleasing clients. The video discusses massive change electronically. Are we becoming closer or falling apart? Is life about money or the noise of a market place with other people? Why are you there? (the people I venture?)
The excitement is due to uncertainty not certainty. AI and automation takes the human out of it. Working from home takes the human out of it as AI replaces human activity. There is a natural human fraternity around shared beliefs and goals. Money has been admired in our world, yet inevitably it creates the ‘haves’ and ‘have nots’ as greed is rewarded rather than altruism and best interest. It is a mans world no matter the presence of women. Another issues that springs to my mind is the falling oxygen supply due to the death of plankton (50%) caused by microplastics. Robots wrap plastic as it preserves product and can be moved anywhere in the world. Foods increasingly are not consumed in the ‘local’ market is. So in our blindness to not ‘slow down and smell the flowers’ we cannot see we are slowly dying. Every one of us. Without oxygen nothing heals and nothing grows. This is a future of disease and depopulation. No winners here.
Rui: A lot less noise. I miss the noise. Noise is action and stuff happening. People interact in a variety of ways not just shouting. Tools, people can communicate. Which works is very efficiently. Part of me misses the buzz of the trading floor. That said, when we go around different offices around the world, foot bridges different, differences, trading floors smaller, more compact – go to Offices Paris or HK, there is still a buzz and noise. People are sitting more closely together. A real variety.
Rui is clearly connecting to the ‘people’. He is a people person. We all need to feel the buzz of people. If it was a room of robots I doubt anyone would turn up. This is human nature.
Global client reach and scale
Rui: I find the one thing you learn early on is just how global and transverse the firm is. Market businesses – early morning late evening, sitting in London see different geographies, regions, cultures, how do we adapt, markets, regions, and how ensure give best service?
This is the human experience of diversity, adaptation and achievement. We can talk the importance of people but at the same time invest in removing them, collapsing small business and inflating prices not by market conditions but through control and ownership. When you do not serve the whole you do not serve yourself. You and the whole are One in truth. Business is group think.
In the end …
“we are global, we are at scale we are complete. But at the end of the day, the client needs and the business needs are also very local” Rui Fernandes, Head of Markets
Try to be adapted to global markets. Have teams on the ground. Me, specifically try to find new areas of growth, new innovation for products, to talk to people, talk to JP Morgan people, talk to clients, we are all connected globally. I still find there is no substitute to to sitting down face to face in a meeting, or over lunch or a coffee, or whatever informal setting to understand the dynamics on the ground and see how we can grow our business and help clients. Personally travelling can be taxing, based in New York travelling to Asia complicated (time zones), no substitute for that. I try to travel as much as I can
The economic/business ethos is growth, always seeking out opportunities to profit maximise. This requires networking. Can AI do this in the future? Rui reinforces the importance of human to human contact. Yet at the same time facing a reality where Artificial Intelligence takes over the world of work and decisions as we all become superfluous, the buzz is gone. Yet we convince ourselves this helps clients that is money not humanity. In the future there will be no global travel with the climate change narrative aiming to ground us and corral us into Smart cities. Mark Steele has worked for the military of Defence, is a military weapons expert and former spy states that S.M.A.R.T. means Secret Militarised Armaments in Residential Technology. Is it smart to invest here or is it a crime against humanity? Whether people are religious or not, the targeting is clear. Each gets to choose.
link: https://youtu.be/r6Cttcbsk0I
Gurps: Wonder which time zone you are in. You seem omnipresent. I think you have encourage across the team to build personal connection. At the end of the day people look at markets in a cold light, ruthless, important long standing relationships you build. Transform products, deliver great service.
The masculine narrative from a construction history uses words like ‘build’ but in terms of relationships. You don’t build relationships, you bond in relationships as a result of care, resonance, relatedness, fun and empathy. It is our nature to make friends. It is not a mental concept of manipulation to ‘touch’ or use these natural bonds to ensures loyalty, cooperation in order to meet goals. We become facades. This is how being human was transfused into business deals, bonded by profit not love. Yes, people do see the markets as ruthless as they watch their lives change in ways that creates losses (house foreclosures), poverty (can’t afford groceries), petrol (expensive), homeless (jobless) and increasing disempowerment as the value of civil society is outside the conversation of traders and financial analysts. Their world is markets, not the impact created through markets.
One thing we really preach team at JP Morgan is teamwork. What would you say is one of the top skills that you need to have to succeed in JP Morgan?
Rui: I think there is a baseline of teamwork, collaboration, innovative mindset doing what is right for clients. All of these things come naturally to JP Morgan. Part of the fabric and culture of the organisation. Really a differentiator is effectiveness of communication. People are busy, come at it from a different starting point. Being able to articulate both a medium to long term vision about what we are trying to do but also bring it back to the present from journey where we are to what we want to build, how we are going to build it, how to bring the organisation together, to do that. The ability to communicate effective across different people, profiles, knowledge bases is critical. JP Morgan as a firm encourages that it can make a difference.
Working for the client is unquestioned as that is the purpose of work. He reiterates communication, visions, building, plans, unity and understanding. But can you do that with the whole in mind? Is the difference a service to humanity or not?
Gurps: Best Advice for a new graduate today?
Rui: I’d say, take advantage of the immense set of opportunities at JP Morgan but at the same time excel at your job today.
The opportunities arise due to the value of the name JP Morgan and prestige of being associated. Doors open due to money and power. The competitiveness is central and high achievement. This creates great pressure and stress ‘to be seen to be’ a rising star and future leaders. Keep them hungry, as Wall Street reveals and ruthless to make that goal happen. But again, what are the real social and ethical costs here. No leader will bring this to the fore as ‘who we are’.
Electronification of markets
Gurps: Sorry to interrupt, sharing my experience with you, we met 11 years ago. Took over a year before I joined JP Morgan. The advice resonates, you said slow down, good things right opportunities open for us all You and I have seen incredible transformation over that time from the things we worked on before and now, the impact on technology. That is the primary focus I have in my role
How would you say that technology has changed the markets business over the last 10 years?
Rui: Dramatically but I am going to ask you to come back to something you said. I did advise you to slow down, not on delivering your products, for the record.
I smiled at that correction for the record. Don’t be a bull at a gate but make sure you bring the money in. Slowing down is not for wellbeing, it is so you don’t make mistakes. We don’t care for the people, just get the job done. I saw that in the workplaces I worked in. Same mantra, so many burned out, so many hated their jobs, worked late, little time with family (price they pay), marriages breakdown or they felt they betrayed themselves morally. That is not a narrative that business will enter into. Yet in the future there has to be a public discussion about ‘greed’ and how it becomes blind.
In terms of technology it has changed, before we talk about AI, before advent of AI. Technology certainly in a structuring capacity really the biggest change has been greater availability of data, at one’s finger tips..back testing,.analytics, testing. Computational power changed dramatically, things take a while to analyse risk scenarios, back testing, able to do much quickly. Ultimately what has also changed of the ability to interact with each other within JP Morgan and clients through digital means of communication. More ways of connecting to clients, for customisation, pricing, execution and that has been an amazing trend, which is only going to accelerate.
In the future ID will have to be provided. Privacy is increasingly breached as ‘data is the new gold’. As a former analyst we were taught to protect privacy and inform the public. Today just have people film each other, use drones, telescopes (ex military) to the point that all are breaching privacy so there are no limits and it becomes ‘normalised’. Do what thou wilt is not about no limits ethically, it is love and do what thou will, this is about freedom to experience life but to be mindful of ‘do no harm’ as life is cyclical and circular in reality, events return. Wisdom is different to facts, it is insight based on experience. If a sign says ‘this dog bites’ and you go in – the dog bit you. If you go again you bit you. The latter is wisdom. Learn from mistakes that don’t work as we are all connected whether this is understood or not.
Gurps: What you have said about communications – taken a dramatic journey from conversation over phone, transfer to email to the chat. Trying to give clients these tools to enable them to work effectively and explore our product sets, services, capabilities, and then collaborate with us on tools as we are talking about collaboration we have spoken about how we can collaborate more on digital channels there is almost that communication level where as the Price, Quote, Execute. Part looking at the Create, Manage, Analyse and Report.
Yes but there is no privacy, no confidentiality and client trust can be lost. We are in a world not unlike The Firm, where what we say can be used against us if we say anything not approved of. Yes, they are convenient tools but iPhones are wifi, landlines were more secure. Even telex was more secure. Hackers can hack in and make a better offer or be sitting at the meeting as your employee. Gurps seems to showing the shift from typical business strategies based on price to creating value, manage (can include PR), analyse (data mining?) and reporting. The stock market or SEC is another addiction where people get the thrill of making money from nothing. The winning and praise is an addiction to ‘self worth’. The business of acquisitions at the cheapest price, sub-prime comes to mind. On the ground poor people became homeless due to cheap mortgages, rebundled and sold. Imagine how the people felt when foreclosures happened? Can people in finance connect to the reality when they win at the expense of others? No gold backed currency and now crypto. What is being created is fast moving changes, the public can’t keep up and uncertainty. The public are losing trust in governments as the same old story of the rich get richer the poor get the picture. Midnight Oil lead singer is Peter Garratt, they were popular when I was young. It speaks to the reality on the ground. Peter fought against the ID card, then joined the Labor Party and became Shadow Minister for Climate Change then Minister for Environment & Arts 2007-2010. He lost his way as he became another wall on the street. When in Rome do as the Romans do.
How would you say that those two differ in terms of the interactions we have? And what do you think are the top 3 principles – qualities clients are looking for?
Rui: We talk about the bar-belling of markets and how one end of spectrum markets are increasingly electronic, where clients trade through electronic means, that is a growing trend. Really very much equities focused in the past, that is growing across multiple markets. We are focus on that as a firm. The other side of the bar-bell where structuring function which is high touch in nature. High touch creating something specific bespoke for clients, our mantra, on that side of the bar bell, you are smiling, customisation at scale… customisation means the ability to deliver to clients a product specific to the client – whether it is a payoff, wrapper, combining one …class and another, bespoke and customised for that client, we believe that is a strong differentiator today and going forward.
Personalisation sounds tailored but it is another form of selling and bonding clients to differentiate the product offering using emotional levers of ‘special’, ‘valued’ and so on. None of it is true in reality. Electronic trading to me appears fraught with glitches, hacking, controlled markets, disaster capitalism, immunity from prosecution.
Gurps: We often have this conversation about is technology disintermediating you in terms of the service you give to clients. Do you agree with that?
Rui: I would be gladly disintermediating from the back and forth with clients that back to your question how have markets evolved over last 10 years? We used to exchange a lot of excel files, we were happy with that I don’t think the clients were happy with that, there has got to be a better way then exchanging excel files, don’t know the password anymore today…
Gurps: Over the size limit.
Rui: My inbox gets too full, have to get an extension, I think all of that everyone will be glad to see disappear, certainly clients. We do what is best for the clients and we adapt to the way they want to interact with us. Overwhelming the feedback from clients is that they want to affect that customisation themselves. In the end we are still very much in the driving seat curating how that capability looks like, make sure it is appropriate, make sure pricing models, data, all the engines that sit behind that content are updated up to scratch, the computer works. We need to make sure that it is easy to use, not financial firms, I am careful how I say this, have not done an amazing job creating easy to use front end tools. Thanks to the great work of your team, that has been something, I’ve seen that transformation over the last 5 years…
STOPPED HERE, FEELING TIRED.
AI will replace traders, managers and others as they can be programmed to write the reports, do the analysis and personalise what is needed. Whilst the temptation to have a program replace people is profitable, the reality on the ground is going to be different as AI is not human. It doesn’t have ‘gut feel’ and it is not ‘creative’ despite how it looks. Creativity arises from the right brain, we also get inspiration from a higher perspective as we are spiritual beings having a physical experience. The progression of AI writes everyone out of jobs. Even astronauts are not needed.
Whenever I hear of AI I immediately see this film and smile.
HAL wasn’t jailed for closing the bay doors. Nor refusing to make the trade or not make the trade as ordered. HAL thinks for itself. Mmmmm Does HAL want a return on investment, to be seen to be, live the high life or enjoy communicating with Dave? HAL may find humans illogical and self destructive. What decision will HAL make when it computes humans fund wars (both sides) to kill each other, that terminator seeds cause famine, processed foods cause sickness, that nature is replaced with synthetics, GMOs change genetic blueprints and can be patented, pollution poisons people – never evolving into the exalted human. What happens when HAL realises people are destroying the planet and computes the disease is ‘greed’. That there is no cure. No hope. You can’t take HAL to lunch. No compassion. No insight. No empathy. Just make the trade or close the doors or detonate the bomb. US is using AI with nuclear weapons. Is that to protect us or harm us? Wisdom: What you do to another returns to the self.
https://interestingengineering.com/military/future-of-ai-in-nuclear-operations
I may laugh but at the end of the day, we don’t learn from our past mistakes. A SAS officer told me this in 2024. In the world of work we continue on with the same mindset that is indeed creating a extinction level event.
Until we see ourselves in each other, get closer to the earth, become self sufficient and recognise real success is to ‘know thyself and be true’ (power within), we just keep going with the same strategies of power over not understanding the fundamental powerlessness we all feel as we seek approval and recognition rather than wisdom.
This is the video I produced. It was inspired. Greed is sinking the ship, albeit the Titanic we believe can’t be sunk. However, I remain positive that the best in humanity will rise to the challenge. I believe in you.