An industry dying
The rot is showing and starting to hurt. The first to be axed will be the remisiers. Following closely will be the backroom staff, then the dealers and the analysts. Eventually the brokerage will simply shrink to a skeleton crew.
How could that be? With investments in the hundreds of millions for out of this world high speed computers, big funds with their high speed sophisticated machines, and product managers with their sophisticated derivatives and wonderful paper products, and with sales volume chalking up double digit gains, why is the industry drying up, and dying?
There were all kinds of gimmicks to increase sales but mostly elementary. Most of the time it is just barking up the wrong tree. What is the real problem in the stock market? Why are the gimmicks of no lunch break, continuous trading, minimal commission, minute bid sizes, cutting more commission to gain market share, sophisticated high speed computers, more derivatives, all proved unworkable? And don’t forget the setting up of many foreign funds to gamble in the stock market, with their expertise and grand machines, it is simply not working.
Does anyone know? Does anyone want to know? Does anyone bothers to know why the stock market is turning turtle? It is time to set up feedback units and ask the people to come up with the answers. Yes, more feedback is the solution.
What is at stake, 10,000 jobs? That is inconsequential. It is the whole finance and banking industry, the financial centre, the companies that needed to raise funds in the stock market that are at stake.
When the financial crisis hit the US, they scrambled for more liquidity, more Quantitative Easing, to provide money to support the industry. What was being done here? Squeeze the liquidity, cut the commission to the barest. Has anyone forgotten that the industry needs the commission to pay for the overheads, to pay for the salaries of all the staff, the fund managers etc? The industry cannot survive without the oil to lubricate the system.
Does anyone know that when commission was 1% we had the best bull run in history? What more tricks are up in the sleeves to save the dying market that no one wants to talk about? How did the industry ended up in this pathetic state? Self inflicted, ignorance or tidak apa, leave it to the experts? Bring in the gods and all will be fine.