Thursday, 8 November 2012

Why Finance Needs Bloggers

Like Hugh Young says, the finance industry is essentially venal. I wish I could read the entire interview where he says it, but because the financial publishing industry covers, well, finance, the interview is hidden behind a venal paywall.

So I tend to think financial blogging is a good idea when it comes to exchanging opinions about all things financial. Singaporeans in general don’t have a whole lot in the way of unbiased financial advice. Possibly because the word advice has subverted by financial advisors, 80% at least 30% of which are well, venal.

The other side is the mainstream media, which, rather than cultivate a diversity of financial viewpoints, has focused almost exclusively on the local stock market. Sure, there is some basis for this approach, after all, it’s a safe story to write, and you know there are a ready pool of stock investors in the local market that you’ll never have to worry about no one reading about SIA’s disappointing 1H2013 or the Heineken/Thai Bev tussle over Asia Pacific Breweries.

But what you gain in safety you lose in experience, and when you cover a world as fast-moving as finance, a diversity of experience is required to keep tabs on all the innovative ways this industry works to speculate on uncertainty. How many people did you know said anything about DBS High Notes 5 prior to the Lehman Brother’s collapse? Could this have been avoided by more honest opinions and better discussions among individuals? No one really knows, but it wouldn’t hurt.

If one were to do a poll right now, and asked the average equity-only investor on the features of a managed futures is, or a fixed income fund, or a multi-asset strategy, or a hedge fund, or a macro strategy fund, or a structured product, or a foreign currency time deposit, or a finglefangledoodletwat, I think most would have better luck describing that last term.

I’m not calling for people to take a position on where the market is going or trying to bet on the next financial crisis; only to venture authentic opinions, clearly backed by evidence, logic and data where available. Like one Chan Chun Sing says, “Diversity is a survival strategy.”

And now I’m going to attempt to come to terms with quoting the same guy who made the Lanfang Republic of ancient China famous. At least his speeches have gotten better over time.

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