Alice has seen some amazing things as she’s moved around in Wonderland. How could she forget that tea-party where she met those oh-so-clever people who encouraged her to put her grand-papa’s pension funds in industrial metal ETFs? Fortunately for her (and her grand-papa) she’d spotted that metals were for using, not just holding, and if they weren’t being used, the price would be unlikely to go up for very long. She’d enjoyed going to the Treasury, as well, where she’d talked to the men who’d decided that when there wasn’t enough money, they could just rustle up some more. She’d spotted flaws in their concept soon enough, but it had been an educative day. And what about her trips to the Washington and Brussels Wonderlands? Those had been real highlights. She’d learned a lot on both those trips. But that’s the thing about Alice; we all know she’s a clever girl, but she’s always keen and willing to learn more about how Wonderland works. Unlike some of those she meets, she doesn’t believe she already knows it all.
So it was that she welcomed her invitation to visit one of Wonderland’s biggest banks, just before Christmas, to learn more about how they traded metals, and why. She was in the big City, the heart of Wonderland’s financial system. She skipped into the great big dealing room and met the men and women who made the business work. She was fascinated; she sat with option traders, futures traders, market makers and prop traders, and all of them explained to her how what they did made money for the bank and its shareholders. In the afternoon, she went and sat amongst the people who looked after the needs of some of the biggest hedge funds and speculators in the world; they were multi-skilled, helping their clients make the investments they wanted. There were also some people there whose job it was to assist the world’s biggest mining companies run their metal hedging programmes. Alice loved the day, and at the end of it, as she went home, her eyes were shining with excitement as she thought how clever the people she had met were and how important they must be to the bosses of the bank.
The next day dawned, and Alice was up with the lark. She was going back to the bank, this time to spend a day with the analysts and researchers who provided a flow of information and analysis about the markets to the bank’s own traders and its customers. But it was just a few days before Christmas, and she had a bit of shopping to do first – cards and presents for all her friends wouldn’t buy themselves, after all. So it was mid-morning by the time she went into the bank’s reception, with its twinkling Christmas tree and sprigs of holly in the vases on the receptionists’ desk. Back into the dealing room she went, and that was festively decorated, as well, Christmas cards in front of all the traders, spangly paperchains hanging from the ceiling and, as she knew from the traders yesterday, Christmas presents from grateful customers in the desk drawers (“don’t tell compliance about that”, the traders had said to her, with a knowing wink).
But something was wrong. Nobody was on the phone, there was no buzz of excited chatter. In fact, most of the people she’d met yesterday seemed to be taking the contents of their desk drawers and loading them into boxes and black plastic sacks. Alice ran across to the desk where she’d been sitting with the traders yesterday. “What’s happening?” she asked.
The head trader turned to her. “They’ve closed the business. Those people in there” – he pointed towards a glass-walled meeting room behind him – “came over from our head office this morning and told us the bank doesn’t want to trade metals any more, so everybody involved in the business was being ‘let go’. Most of us have to be out of here with all our possessions immediately, and just a few will stay on for a while to wind down the business.” He shrugged.
Alice was appalled. “But it’s only a few days before Christmas. And everybody is losing their job. That doesn’t sound nice.”
The trader shrugged again. “It’s not, but that’s just the way things are. Look” – he scribbled on the back of his card – “that’s my email. Keep in touch. We’re all going down to the pub, but you can’t really go in there.”
Alice didn’t really want to pry, and she knew the trader had earned a lot and lived in a beautiful house and drove an expensive car, but she had to ask. “Do they pay you off well?”
“Nothing special. The law tells them what to do. Look,” he said, “the bank has been in and out of the metals business over the years. They hire people in a rush of enthusiasm and then lose interest after a while and can them all again. Then the whole cycle starts again a couple of years later. Frankly, they don’t really know what they’re doing – they just follow the herd. Makes our lives difficult, though.” He grinned at her. “They pay us a lot while they want us, but forget about security. It’s not a bad balance overall, just a shame it’s only a few days before Christmas – puts a bit of a damper on it, somehow.”
Alice left the building and wandered off down the road, thinking hard. Everything in Wonderland was maybe not quite how it seemed.
This site has been running now for just about five months, and I’d like to take the opportunity – as it’s Christmas and time for taking stock of the year – to thank all the readers for their support. It’s really appreciated. I’d also like to thank my guest writers who have made a substantial contribution to the success of the site and my advertisers, whose participation is also much appreciated.
Merry Christmas and a Happy New Year to all.
