How to learn to love a banker

Mrs G is a magnificent lady. She loves hosting grand parties that one must wear pearls to. Mrs G also belongs to an era when investment bankers were glamorous beings that glowed with pride at London’s parties.

A few weeks ago at one of her soirées she grabbed a hold of me to introduce me to a nice young man. She introduced him as a banker at Deutsche Bank. I saw the trapped young man cringe as just that week the scandal that Deutsche Bank was in serious trouble was dominating the headlines. Mrs G went on and on about what a wonderful and successful banker he was as the young man stared at his feet and obviously wished he had been introduced as a psychopath, kitten-killer – anything other than a BANKER.

As an accidental capitalist I feel his pain. “Banker” seems to be a catchall phrase for anyone in the financial sector and we are the punching bags for the economy.

As a society however “bankers” are an essential and needed party of our economy.

With the 2008 financial crisis it's become de rigueur to banker bash. There were howls of outrage in the newspapers as it came to pass that the UK government wants to protect bankers on Brexit by potentially using billions of taxpayers money,

The financial sector works as an engine for the economy. You cannot look at finance as a “sector” like mining or airlines. Finance powers every other sector and is critical to the existence and expansion of the modern economy.

To break it down simply, there are 4 kinds of wealth:

1.    Cash – dollars, sterling, cowrie shells….

2.    Real assets – houses, building, gold in your safety locker, ownership of a uranium mine….

3.    Equity – shares/ stocks – ownership of a slice of a corporation

4.    Debt – fixed income/ loans – a promise to be paid back for wealth you had handed over to a corporation or government body.

Now “bankers” i.e. financial services have two major functions – one is to manage transactions for all these transfers of wealth. The other is to invest these types of wealth to generate new goods and services expanding the economy – creating jobs etc. and driving every other sector from technology to utilities forward.

An example of transactions could be going to the cash machine to transfer money from digital numbers in your bank account to hard cash in your hand. It could mean the process of lending you money to buy your dream house.

Investments by the financial sector can range from a fixed income product that concentrates on Chinese industrial companies to a fund that venture capitalists use to develop the next Google or Uber.

Every corporation, local authority and government depends on the ability of the bankers to manage the growth of our economic goods and services by (a) managing transactions and (b) investing.

So much as we hate them, we need the “bankers”.

Find a banker to hug today!

Best,

Mallika