Self-reflection

Dear all,

Unfortunatlely our time at ebs ended (finally for some), hence it is primordial to do a self-reflection or a self-critique of my developement this course.

If truth be told, I started blogging over 6 years ago at a very low point in my life (blogs were a  trend in France).  All of the roads in my life were blurred and I was distressed over issues that I did not have the power to change.  So I began to blog, which in turn meant that I began to write, take pictures, and document everyday life.  Every step, was written and documented almost daily. Although I did not elaborate completely while blogging about those difficult, yet necessary steps that I took each day, I can now go back to those blog posts whenever I want, and see how I learned from my experience and help myself move forward. But writting a critical blog about finance, economic or a business subject raises the bar and is obviously more challenging. As I am someone who likes to be challenges (it gives me this adrenaline, this cutting edge that let's me surpass myself), I accepted the challenge.

During our lectures we learned theories about different styles newspapers write in, and how some journals can be really bias. Additionally we observed that journalists mostly add their own opinion to the stories, which they are covering, to address the regular readers, who are purchasing this particular newspaper to read the opinions. Before the course, I was only reading news from 2 or 3 newspapers (FT, thesun and Le Monde) but during this course I developed a wider knowledge about newspapers and consequently started to read daily different news sources. In fact, at the end of the course I was reading the FT, the sun , le Monde, the Economist, Newsweek, Businessweek ...

Furthermore, something that I really enjoyed in our lectures is how could easily compare 2 newspapers, that despite covering the same news, have a different style of writing and different opinion. To be honest, I was really naive in the beginning to think that politics or other external factors do not affect the view of the newspaper. As the weeks passed, I grew with this course and could easily understand why there are such differences. Overall, I really enjoyed writing this blog and  in my opinion it was a good opportunity for us to improve our writing skills but always to read the news continiously without being lazy. 

I hope that I created an interesting blog, which brought the readers my opinion about the financial markets a little closer and created some value for them. Personally, I learned that  using the internet to spread your opinion by using blogs as a form of communication can be a powerful tool for spreading your opinion and point of views. .

Finally, I would to express my gratitudes to all my class mates (I would lie if I say that I got a long with everybody though) and Ms. Linda lewis who made this class extremely enjoyable.

Yacine Dessouki

Bloomberg LP guided tour

Dear readers,

On the 24th of November, my class mates, lecturer Mrs. Linda lewis and I had the opportunity to visit Bloomberg's offices situated in Finsbury Square. Like an enchanting lullaby, I woke up to bloomberg's channel and slept on its mesmerizing financial news, and to be honest, I couldnt contain my excitment anymore. 

Source: Flickr

The first thing that really caught my attention is how well the different departments are layed out. Each deparment has a different flashy colour : blue, orange, green, yellow. This interesting approach is supposed to bring inspiration or calmness depending on the colours, which in my opinion is really important because the employees are a valuable asset for the company and their well being shouldnt be neglected. Well being, calmness, relaxation, positive thinking are all connected and this brings us to a second thing that fascinated me about Bloomberg's offices. On each floor, there is an enormous fish tank that holds more than 600 different species from goldfishes to tiger sharks. It is scientifically prooven that if every employee stares at the aquarium for 15 minutes, positive thinking and calmness will result. Also, something that I found unsually ''green'' is the recycled tables and chairs thus promoting a sustainable environment. Furthermore, we were lucky enough to watch a LIVE tv presenter Judith Bogner (picture bellow) which I immediatly recognized due to my timeless times watching Bloomberg on the sky television. I was really impressed by the high tech cameras and the big touch screen that they had on the set (something from a science fiction or a movie, minority report).

Source: Businessinsider

We also got an insight about Bloomberg's terminal which is the main core product, something that I always found imcomprehensible and really hard to use. To be honest, I really dislike the discomfort you have whenyou use the terminals keyboard, something that in my opinion Bloomberg should redesign.
Then, we gathered in a room and met one of the HR managers who gave us an insight about working at Bloomberg. She clearly said that there are no minimum requirments for some positions, something that I found hard to believe. She mentionned that the company's structure is flat, meaning that each employees are equal and they dont have a ''job title'' hence the seemless transparency and lack of walls in the structure of the bulding. Finally, we ended this interesting tour with a quick meal and snack at the cafeteria which provide food for free for its employees.

This guided tour was a nourishing experience to the extent that I already applied for an internship at Bloomberg as a junior sales analyst. I came , I saw, they conquered me.

Yacine Dessouki

The sad reality about Microfinance

Dear readers,

As the topic of my dissertation was about Microfinance, I think that it would be useful if I share my deep knowledge about this interesting topic.

MICROFINANCE is an example of something that is sadly all too rare: an anti-poverty tool that usually at least breaks even. If you make small, uncollateralised business loans to groups of poor women, they almost always repay them on time. It has grown rapidly in many countries, not least Bangladesh and India. With nearly 30m clients each, these are now the world’s biggest markets for microfinance. Yet the industry has come under attack for being too commercial. In Bangladesh the government has capped the annual interest rate that microfinance institutions (MFIs) can charge at 27%. In India a new breed of for-profit microlenders has shaken up an otherwise NGO-dominated sector—and annoyed the authorities. In Andhra Pradesh (AP), the Indian state with the most microfinance borrowers and the base for the biggest for-profit MFIs, local politicians have bullied the business to a virtual halt. An interest-rate cap is mooted. These steps are ostensibly motivated by a desire to defend the poor from getting stuck in a debt. But they are wrong-headed.

Despite charging what may seem high interest rates, MFIs typically have wafer-thin margins because of the high costs of making and collecting payments on millions of tiny loans. Pressing them to reduce rates further would jeopardise their ability to attract private capital, inhibiting their growth. Slower growth would in turn hamper their ability to harness economies of scale in order to lower transaction costs and cut rates of their own accord, as many—including the biggest for-profit MFIs—have done in the past. Forcing down rates would also deter new entrants and reduce competition.

Source : http://cdn.trak.in/wp-content/uploads/2010/08/image1.png

The rush to impose restrictions on MFIs also betrays a fundamental misunderstanding about how the poor use credit. Many politicians cite the existence of clients with loans from several MFIs at once to argue that the poor are over-indebted. This ignores the fact that most microcredit loans are tiny, so that several are needed to meet the needs of even a small business. Indeed, the poor often use microloans to pay off far more expensive loans from village moneylenders. This suggests that restricting people’s access to microcredit by capping rates could have the perverse effect of driving more poor people into the arms of village loan-sharks, who still provide the bulk of rural credit in poor countries. (In rural AP, 82% of households have such informal loans, whereas only 11% have loans from MFIs.) That would be good news for these moneylenders, but is surely not the outcome that policymakers want.

Peruse prudent

Sensible regulation need not be at odds with a thriving microfinance industry. Peru, for example, is ranked by the Economist Intelligence Unit as having the best business environment for microfinance, in part because the regulator has successfully set and enforced rules on capital buffers, leading to a more stable environment for the industry. India, in contrast, is yet to decide whether rules governing microfinance are to be set at the national level or by individual states.
An association of Indian MFIs is trying to set up a credit bureau which would allow them to track clients’ overall indebtedness and credit histories, thus guarding them against lending a person more than she is able to handle. This would be helped enormously if the government speeded up its efforts to give all Indians a universal identification number. The Indian government should also allow MFIs to take deposits, which they are currently prevented from doing: this would make them less dependent on capital markets for funding. All rather complicated things, unlikely to stir up populism. And all a lot more useful for the poor than an interest-rate cap.

Yacine Dessouki