There’s something about traders. This year alone, we’ve had Navinder Singh Sarao, whose life fell apart after he was arrested for allegedly causing the flash crash, and Tom Hayes, whose life disintegrated after being accused and convicted of manipulating LIBOR. Now the Financial Times brings us up close and personal with Kweku Adoboli, the UBS trader whose unauthorised trades cost the bank $2.3m and himself two and a half years in jail.
In the same way that the Wall Street Journal’s David Enrich became a personal friend of Tom Hayes, the FT’s Lindsay Fortado became a personal friend of Kweku Adoboli. Like Enrich’s, Fortado’s resulting article is peppered with communication from the sinking trader – although Adoboli seems to have sent letters while Hayes bombarded Enrich with texts.
Hence we learn that Adoboli writes in the simplistic script of a 13 year-old girl, that he learned to play the guitar in prison and likes to talk metaphorically (“It’s funny trying to prepare for the future when there’s a surprisingly real and very opaque bouncy rubber wall in the way.”) We learn too that Adoboli believes in telepathy (he tried to send telepathic messages when first arrested) and walks the good guy walk (he’s a “peace and love type” says a former boss). It seems that UBS was initially relaxed about his crime: they gave him pizza before saying, ‘really sorry Kweku, we know we said you could go home but we’ve had to call the police and they’re coming to arrest you.’
There’s also a rehash of some of the stuff we knew already: that Kweku Adoboli’s pay went from £45k to £360k over five years, that he was 31 when he was found out, that he was illegally booking non-existent trades to hide his losses. But we’re also informed that Adoboli was exhausted while his crimes were perpetrated (““There’s only so long you can go sleeping three broken hours a night”) and that his boss was at the Burning Man Festival when Kweku needed him most.
Overall, the picture that emerges is of a nice guy who couldn’t differentiate between right and wrong. ‘He never denied the methods but maintained that everything he did was done in order to make UBS more money,’ notes the FT of his trial. “I was found guilty under criminal law, so according to the law I was wrong,” Adoboli tells Fortado. “- I’ve said I’m sorry all the way along . . . I don’t want to cause pain to anyone. In fact, that’s the tragedy of all this. The pain was the result of trying really hard not to cause the pain.”
Separately, a Princeton economist has researched the income level which is best for happiness. It’s $75k (£49k): beyond that, happiness plateaus. Life assessment, however, keeps on rising with income. “Giving people more income beyond $75K is not going to do much for their daily mood … but it is going to make them feel they have a better life,” says the professor who performed the research.
Barclays’ chairman John McFarlane does not approve of bonuses. (Financial Times)
The new trading book rules could kill banks’ fixed income trading businesses: unless things change, banks will have to hold 4.2 times the total market risk capital they hold today and will face an increase of 2.2 times in capital requirements for securitisation, the study found. (Financial Times)
Credit Suisse will no longer be a primary dealer in Europe. (Bloomberg)
Hedge fund trader who was going to join Credit Suisse decides that’s not such a good idea after all. (Reuters)
Leda Brega’s fund now manages more money than BlueCrest. (Bloomberg)
Goldman Sachs is hiring commodities traders from Glencore and Moore Capital. (Bloomberg)
BNP Paribas might make 100 of its 560 staff in the Middle East redundant. (Bloomberg)
What Greg Smith, the man who left Goldman Sachs, did next: “…leaving the top of the financial food chain for a Kansas-based small business, giving up giant sovereign-wealth funds as clients and picking up elementary-school teachers and bus drivers.” (NY Mag)
A video about what it’s like when you work for Google. (Inc)
How do you know if your level of social anxiety is considered disordered? (The Atlantic)
Lift weights, have fewer brain lesions. (NY Times)