Demand Destruction

Sorry, a bit pushed for time today, so a cut-and-paste job (prompted by an email from Ben - feel free to add your own 'firm' views in the comments page ;-) from a recent discussion on future oil prices.

"Demand destruction" is one of those buzz-phrase memes that gets propagated without (I believe) really considering its validity. Usually by people on wireless bluetooth headsets. Here is my take on it....

Some interesting and valuable comments made here. I would just like to add mine on the "demand destruction" phrase that has been wheeled out and repeated a great deal in recent press.

True demand destruction can only happen in markets that are either non-essential, or where substitution options exist. Neither is the case with oil. It is so much a part of the fabric of our way of life and economies that any demand erosion will be temporary.

The recent grounding of planes by various airlines is not the destruction of demand for jet fuel. Air travel will continue, and once the airline industry has found a way to come to terms with crude oil above $100 those planes will be back in the air. American motorists might curb their driving habits this year, but they will ultimately accept Gas at $4 a gallon, or $5, or $8. In the UK Gas is $10 a gallon and I'd wager that $20 would have little more than a short term effect.

The industrialisation, urbanisation and improving lifestyles (not to mention exponential global population growth) of the emerging economies will only serve to increase demand for what are ultimately finite resources. Until we find a way to substitute our intimate dependence on
oil, there will be no "demand destruction", and only temporary respite from inevitably higher prices.

It's Catching

TB made a schoolboy error on his first night in town - going for a quick beer with VB after work.

Now, bear in mind that he came straight into the office on Monday morning after touching down on a 28 hour flight from Sydney, so at 3am after an extended night out on the town, "bleary-eyed" probably doesn't quite cover it. However, it's still something of a mystery how he came to wake up after somnambulating into the kitchen of the Holiday Inn. Looking for his wallet. Perhaps this is a metaphor for his Whale...who knows?

What's weird is that a while back, VB had an even stranger nocturnal episode, not long after arriving from Sydney himself. That mystery, worthy of a post all of its own (I'll come back to that one ;-), remains unsatisfactorily unresolved.

Let's assume both jetlag and copious amounts of alcohol played contributing factors in both cases...

Monday Shocker!

Horror! Disaster strikes! Not even FVJ quoting EUR/HKD 8 big figures off-market (I may return one of his kidneys on Friday if he manages not to screw up the rest of the week) could cause me greater consternation than seeing (the town of my birth) Weston-Super-Mare's glorious old pier burnt to a crisp.

TB is convinced it must have been an insurance job ("how do you burn something down that's in the water"...sorry, he's from Oz) but I'm not so sure. It's a well know arson fact that the perps like to watch their own conflagatory handiwork. I have no direct evidence, and the motives can only be guessed at but there is just something about the individual in this photo that reeks of malicious intent.

I urge the Weston-Super-Mare police to cover their asses and leave no stone unturned in their investigations

The Monday Feeling

It's Monday morning and, for once, I am actually looking forward to the coming week in the day job...

UDH Boy is roasting his children in sunny Spain, Schadenfreude Boy is somewhere else (I am guessing NOT Spain), and Pam is somewhere else too (I really do not want to think about what he does on holidays). Therefore, I am dusting off the old rusty handsets and spending the week demonstrating to Trywalker how easy it is to make a real mess of things in the Sterling markets.

On top of that, we have TB, "our man in Sydney", cruising into town. Presumably he will be spending the week deomnstrating to Trywalker how easy it is to make a real mess of things in the Altstadt. Should be some fun...

The Comfort Zone

Someone once said to me that "nothing worthwhile is ever achieved within one's comfort zone." There is a ring of truth to that, although of course with all vague, open, generalistic statements it probably doesn't stand up to rigorous examination. Sleep, for instance, a thoroughly engaging and indispensable activity best achieved at the very kernel of one's comfort zone, might be one glaring exception that I would find hard to argue against. However, the general principle of the statement has some merit, and besides, picking holes and splitting hairs is for someone with a more intricate toolset than I am equipped with. I have no microscope, average dexterity, and only rudimentary debating skills in the box. I digress...

Since the (purported) purpose of this diary is to document my thoughts, feelings and actions associated with the departure from the 'comfort zone,' on an (arguably) intrepid journey into the unknown, it's worth pausing for a moment to consider what we are leaving behind...

18 relatively successful years in financial markets has facilitated the establishment of a very agreeable lifestyle.

Home is a large apartment in the centre of a swish part of town, that most visitors seem at pains to compliment. The soon-to-be-completed holiday home in the Swiss Alps could be mortgage-free. Sparkly Aph enjoys a life of leisure (although certainly not idleness!). Nowhere is off the holiday radar, and the mini-Somnambulists jet around Europe on a regular basis. There has been fast living, fast cars (at least one of them was a 'proper' Porsche, before you say a word Mr K!), and the golf handicap is still heading lower.

There are no debts. Financial security means not having to worry about the curly credit card print-outs at the petrol station or at the supermarket. Or, for that matter, about credit cards at all. Or the credit crunch. Until now, credit has been purely something for bestowing on people who have done a satisfactory job.

Speaking of jobs, the current one is pretty good. The pay is great, the career path is gathering momentum, I work with some great people. Sure it has some stress attached, but so do all jobs. I don't really know anyone who isn't occasionally stressed out. A friend of the family used to do make-up for photographic models, and accompanied Patrick Lichfield on several Pirelli Calendar shoots. One of his tasks on tour was to ensure that, when in front of the camera, the girls' main assets were suitably perky, which he achieved with the careful application of melting ice cubes. That job had stress. (A moment's pause to consider the relative virtues of a new career as a make-up artist. Or is it artiste?...)

Re-reading the above, I can imagine that those readers who have got this far into the navel-gazing (and not already clicked the 'Next Blog' button at the top of the page), have probably started to form various opinions. I can imagine thoughts of 'idiot', 'lucky', 'w+nker', and 'get on with it' swirling around. Which one you are thinking very much depends upon how my current comfort zone aligns with your own individual Holy Whales.

As for my own, I'll try and explore why I feel the need to seek elsewhere in further posts...

What's so good about the comfort zone, anyway?

Today is Mutti's birthday, which she is celebrating in an exotic location called Penarth. I don't know where that is, but many, many happy returns all the same, from all the Somnambulistses ;-)

Feeling The Pinch

All is not well with the world. There are too many people on the planet and they need to eat, to drink, to get to work and to build websites, which is consuming a plethora of natural resources (such as food, oil, metals and bandwidth) at an unprecedented rate. Unless you are a Russian energy oligarch, a Monaco prince or Steve Jobs that means you are cutting back.

Given the scandalous mis-pricing of risk that led to the implosion of the sub-prime mortgage market and the current credit crunch, even the normally immune world of high-finance executives is feeling the pinch. It's rare these days that a bank's top market operators have the cash to flash Ferrari 430 convertibles and enough Rolex watches for an octopus. Come to think of it, I can only think of one...

"Tangible evidence of the world-renowned Global Head of Trading for an
international bank cutting back on fuel costs..."

"Rare glimpse of world-renowned Prince Albert of Monaco showing off his new
toy as he leaves for the office..."

Hands-free Phone Sets

There isn't really a great deal that genuinely irritates me (well, except for... no, let's not go there) but the recent office trend of using bluetooth-enabled cordless headsets is seriously getting on my nerves.

It's not the headsets per se, but rather the behavioural shift that accompanies their use. Specifically, just talking to someone who happens to be wearing one of these high-tech alice bands takes on a new dynamic. Take, for instance, those awkward pauses after you ask someone an equally awkward question. Is that gormless, vacant look on your face your normal gormless, vacant look of incomprehension, or are you actually listening to your gormless, vacant broker? Or on a conference call with your gormless, vacant technology vendor? Or spending company money on premium-rate phonelines?

Some kind of blinking light on top of your head to indicate that you are 'on-line' might be appropriate, perhaps...but then again, it already feels like an episode of Dr Who in here as it is.

However, the part that reeeally gets up my nose is that the passageway that runs along the length of the dealing room windows, and with unfortunate coincidence right behind my seat, is now Jerry Macguire Avenue. I have a constant parade of ego-pumping psycho-bankers power-wafting up and down, living in their own nightmarish reality-TV show, occasionally pausing right
behind my head to add extra emphasis to their condescending pitches, and leaving a pungent miasma of testosterone and bullsh+t wafting around my desk.

At A Tiger In Africa offices, these devices will be banned.

"Hey! Herr Gitschleim... how about you get yourself a) A phone, b) A life, c) Away from my desk."

You Think Oil Is Expensive?

US light sweet crude.....................$130brl

Coca Cola.....................................$126brl

Milk..............................................$163brl

Perrier Water................................$300brl

Budweiser.....................................$447brl

Starbucks latte..............................$954brl

Ben & Jerry's ice cream...............$1,609brl

Tabasco sauce.............................$6,155brl

Chanel No 5..........................$1,666,560brl

Note: these facts were compiled by a contact on a certain foreign exchange desk in Singapore, who clearly has way too much time on his hands. I have no idea whether or not they bear any relation to reality. Well, except for the fact that as and when we need to tighten the belt, it might have to be the Tabasco sauce that goes. It's a hot :-) commodity in the kitchen, goes on everything, and seems to disappear at a considerable rate of knots. The only thing I have seen vanish faster was our ex-commodities trader when it was his turn to buy the desk sweeties. Which reminds me, his marbles are still knocking around here somewhere....

LV Has A New Nickname

Lord Voldemort, "he-who-shall-not-be-named," the bringer of evil, the instigator of chaos, the spreader of discontent, and generally rather annoying, has a new nickname: Schadenfreude Boy. The LV epithet has served him well for over a year now, but it's getting a bit worn out. Also, we are getting a little concerned about possible brand erosion, now that Sky TV is running ads for LV.com ad nauseum. LV does not do insurance. He does not do much really, other than play Ebay and cackle when other people are losing money.

While Schadenfreude Boy is away, his nemesis, UDH Boy, is taking a breather. In fact, with Invisible Girl away too, an air of positive calm has descended, with only the deranged antics of FVJ raising a flicker on the exasperometer.

By complete coincidence, today is UDH Boy's birthday, so many happy sausages old chap!

Only In Australia

Project Dennis consuming vast majority of available resources, therefore I have to resort to pictoral plagiarism this morning for a quick post (and possibly a quick laugh).

Inspired by Daddy Papersurfer's artisitic, lavatorial genius on doodle week, this one gets an airing...

"AIM: Comfortable Living Specialists"

All Go On The Western Front

A top weekend with lots done and the roadmap taking shape. Only some remaining preparatory work to be completed before we start courting appropriate developers to turn Dennis into an alpha-site. Can't wait to get started...

Meanwhile, Sparkly Aph is en route to Zermatt to see if Swiss builders know how to finish an alpine chalet, and the under-exercised hairy one is trying to escape into the great outdoors. Time to head off for the day job... At least LV-less atmosphere should be rather more bearable!

Progress On Project Dennis

After a day of schemeing, plotting and planning we have made considerable progress on project Dennis. Firstly, it has a new code name: Dennis. My proposals for more interesting and dynamic names were rejected. P-i-g thought Project Dinsdale and Project Spiny Norman were a bit too silly. In another landmark decision, we have come to the conclusion that we may need more computing power than my old BBC Micro, so unfortunately the old fella has to go back in his box in the attic. His time for one last killer app will come...

Weekend In Briefs

A short update this morning, partly since previous entries have bordered on the excessive side of verbosity, and partly since there is so much to do!

Exciting weekend ahead: p-i-g is jetting in with head-teach for a two-day workshop crammer, with project brainstorming, webstracting, elevator-pitch-plotting and bacon sandwiches all on the agenda. Plenty of prep work done (if I never see another entity-relationship-diagram ever
that's just fine - well, at least until the next big thing!), and pretty optimistic that the first lines of code for the beta-site are spontaneously materialising in the Interweb ether all of their own accord. That's how it works, isn't it?

For once, The Open is going to have to take a back seat...

If...

In tribute to my ex-father-in-law, Brian Ridge, who lost sadly lost his battle with cancer yesterday.

If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too:
If you can wait and not be tired by waiting,
Or being lied about, don't deal in lies,
Or being hated, don't give way to hating,
And yet don't look too good, nor talk too wise;

If you can dream—and not make dreams your master;
If you can think—and not make thoughts your aim,
If you can meet with Triumph and Disaster
And treat those two imposters just the same:
If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
And stoop and build 'em up with worn-out tools;

If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breathe a word about your loss:
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on!"

If you can talk with crowds and keep your virtue,
Or walk with Kings—nor lose the common touch,
If neither foes nor loving friends can hurt you,
If all men count with you, but none too much:
If you can fill the unforgiving minute
With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
And—which is more—you'll be a Man, my son!

Rudyard Kipling

Admitting Deceit

It's a fairly common observation that most people find it hard to admit defeat. But, in my experience, not nearly as hard as they find it to admit deceit.

A certain friend, who I may return to in later posts, taught me, amongst other things, a great deal about bullsh+t first hand. Not, as you might expect, by pulling the wool over my eyes and leading me up the garden proverb, but mainly through a fearless, shameless and relentless effort to expose my own bullsh+t at every conceivable opportunity. And I presented plenty of those. It was an unsettling relationship, but the result is not only that I am a lot more careful about what comes out of my mouth these days, but also that my own BS radar is now a finely tuned, precision instrument. And goodness knows, in this business it needs to be.

One of the more obvious techniques of experienced, hard-core bullsh+tters is to turn up the volume in order to disguise the smell. It's a BS fact that the bigger the pile, the more emphatic the misdirection, so my advice (if I may be so bold) is to ensure your skepticisim is at its keenest when proponents are their most hysterically evangelical. (This post came perilously close to touching on religion there so a quick change of tack, methinks...)

I am disappointed by the fact that the word bullsh+t is now so overused. Most often, when I hear or read "that's bullsh+t!", it is actually being used to say "that's incorrect.", which to my estimation seriously dilutes the phrase's true value. It's so perfect for conveying it's real meaning: saying "bullsh+t" should be shouting aloud that not only have I caught you in the act of pretending to know the answer when you don't, but also that I am going to expose your deceit! Which is very different from shouting "You've made a slight error in your calculation there."

Most people are natural bullsh+tters. It's the default position, when you don't want to look silly, stupid, thoughtless, ill-prepared, etc. to just wing it. And put like that it sounds pretty harmless, but it's not! That little lies lead to big lies is inevitbable, inebivatble, inevtia... a foregone conclusion.

Kim Jong-Il: Level 12 Bullsh+tter

Another Day At A Medium-Sized International Investment Bank

I eagerly await the introduction today of my new boss. Yesterday my interim boss' boss called me for a secret meeting to explain the new organisational structure that was in the process of being discussed by the board. I would have felt a certain sense of importance by being brought into the circle of trust, were it not for the fact that all the details that were being revealed in 'strictest confidence' have been part of the public rumour mill for around 4 weeks. My interim boss' boss told me that my new boss' boss would be calling me yesterday afternoon to talk to me about the new structure but he didn't. I had a rare sighting of my interim boss yesterday afternoon. He looked flustered.

All this is indisputably the fault of my former boss, who quit three months ago, leaving a power vacuum of considerable proportions. Thanks mate.

(...meanwhile, in an attic far, far away, my partner-in-grime has taken a day off from his proper job and is beavering away... I can almost smell the corporate identity starting to flesh itself out from a different time-zone. Go for it N :-) )

It's All About Respect

A good Antipodean friend of mine has a favourite saying: "It's all about respect!" (most usually wheeled out when he isn't getting any).

No. 2 on the list of Goldman Sachs' Business Principles reads as follows:

"Our assets are our people, capital and reputation. If any of these is ever diminished, the last is the most difficult to restore. We are dedicated to.."

Reputation and respect go hand-in-hand. Respect is acquired gradually, one carefully planned action at a time, one blemish-free day after another. A reputation can take a lifetime to build and yet be so easily shattered. Lost in a careless moment of ill-conceived rashness...

Scooby Doo explains to world-renowned BBC correspondent Kate Adie why he is posing as a world-renowned money broker for the day

Starting Blogic

I have never kept a diary before, so why start now? In public (well, sort of)? There are a handful of reasons, and so for good order, I thought I would jot them down for my own interest.

First and foremost, I am embarking on a course of significant change, and leaving aside for now the validity of the particular avenue I am pursuing, I am keen to explore my own motivations in more depth. While I have tried to analyse and understand this on a rational level, I am also very aware that the real driving force is an intangible that I just cannot ignore, and I think attempting to articulate will assist in scratching the itch. Stepping off the gravy train to take major risks, at a time in life when most people are seeking to mitigate or eliminate them, deserves some soul-searching. In short, this will be a glorious exercise in self-indulgent navel-gazing.

Peering beyond the fuzzy, blue lint for a moment, ....when did THAT turn grey?! Sorry, distracted for a sec there.... it occurred to me that other people may actually have an interest in reading about this. If that sounds in any way self-important, let me clarify that I'm referring to the plot-line not the actor. For some, there should be some value in following the start-up process in 'real-time', principally to take note(s) of my inevitable mistakes. For others, I sense the life-change process is something that may be close to many hearts. For those that are also taking a mid-life plunge into the unknown, perhaps I can offer some solidarity. For those that would like to, but cannot bring themselves to break the shackles, there may be a mild vicarious pleasure without the likely train wreck (and don't feel guilty about the schadenfreude). It's a bit like the underdog getting to half-time in the FA Cup final (there's only one match in life, so it has to be the final), being 4-1 up, and then deciding to go and play rugby in the second half. At first glance, it seems irrational, the odds of success are not good and there is a serious risk of injury. But let's face it, whatever happens, it should make good TV.

There is of course the small chance that we are not barking mad, that (like every other start-up ever) we have the key to changing the world. Maybe we really can harness the power of social-networking and collaborative content generation for the not-inconsequential goal of creating order out of chaos in the unfathomable data mine that we call the Internet. Perhaps we really can usher in the next phase beyond Web 2.0. What a story we would have then...

A former boss had a wonderful phrase for breaking such trains of thought: "...and then I woke up, and my hat was on fire!", he would say :-)

Back in the real world, it's my hope that this blog will also provide a little aid to self-discipline. One of my biggest weaknesses that I have so far spotted, flushed out, cornered and tried to put in a box is a troubling tendency to not finish things I have started. I have a large collection of half-painted canvasses, for instance. Some of them are actually quite old. So I find making a verbal commitment, to as many people as possible, increases the chances of taking the project to at least an acceptable status of completion. Telling people gets results - this is not a 'cum hoc ergo propter hoc' fallacy, it's just a simple fact that it is harder for me to accept the shame of backing down and admitting defeat, than it is to carry on regardless (regardless, that is, of how far down the dark, blind alley you have gone). I cringe and shudder at conversations that start "Hey, weren't you going to **fill in blank with fleeting interest/venture/resolution** . So, what happened there then?", and proceed with pathetic, embarrassed rationalisation on my part. I have gone through periods of almost total social reclusion for this very reason. In this case, the commitment is doubly binding. Not only am I declaring the intended path, but also I am actually writing it down and documenting it as we go, leaving a veritable audit trail of intent: I have deliberately removed the option of resorting to "well, I didn't exactly say THAT..."

Oh, and finally there is of course the undeniable fact that since teenage years I have secretly always wanted to be as cool as the papersurfers. They always seemed to be able to do everything that I would consider very difficult (growing houses out of bricks, for example), with disconcerting ease and an air of nonchalance. They say that imitation is the highest form of flattery.

I hope that whoever ends up reading this finds something of interest here. In the last few months, I have tried to impart a certain casualness to the close friends who know what's on the cards, but privately, to me, it's all actually rather exciting. I wonder how well I will do at recording the mundane and dreary, when it comes.

If this blog dies a death in three weeks, please feel to send an email saying 'SOMNAMBULIST, YOU ARE A LOSER' in the largest available type-face.

Desk Blur

Sunday afternoon and after a day and a half of immersion in webness the scattered sheets of notes, ideas, proposals, lists, entity-relationship diagrams, flow-charts, company registration documents, agendas, post-its, airline tickets and (very old) score-cards have started to visually merge into a slightly out-of-focus and barely discernable, impressionistic montage. If Claude Monet had lived another hundred years and painted my desk it would have looked like this...

View from Somnambulist's Desk, Nikon 2008

View of Palace from Mula, Venice, Claude Monet 1908

Why "Holy Whale" ?

Grails have been done to death. They are so old hat. So Web 2.0. Holy Whale implies something BIG, slippery, and difficult to catch without the help of a few friends. Not that I advocate catching whales. It's a metaphor, ok? And on the subject of metaphors, it's also a kind of realistic acknowledgement that the prize at the end of this journey will almost certainly be rather different than the one envisaged at the outset.

Happy Birthday to TB in Sydney! ;-)