Who says journalism is a dying career path? A former Financial Times leader writer, BBC economics editor and most recently chief market strategist at JPMorgan Asset Management is returning to journalism at Bloomberg – and, in an unexpected twist, she’s getting a raise to boot.
Stephanie Flanders said the primary reason for her upcoming move to Bloomberg is that she has missed journalism: “Bloomberg has traditional journalistic values and ample financial resources.” The latter attribute was likely an important one. The Financial Times says Flanders will earn more at her job running a new 120-person team of economists and economics journalists than she did in her J.P. Morgan role – where she’s thought to have brought in as much as £400k ($520.18k) a year.
If Bloomberg is indeed paying Flanders very generously, it won’t be the first time. Joe Weisenthal, the former executive editor of Business Insider, is thought to have been paid a lot to join the media company in 2014. Authors Mark Halperin and John Heilemann were reportedly paid over $1m each when they joined to start a standalone politics brand in 2014.
Bloomberg expects hard grind for its money. The FT says Flanders will be expected to begin work at 7:30 am at Bloomberg and then travail into the early hours as she meshes together Bloomberg’s journalists and economists. This looks incongruous when you consider that Flanders’ father was a musician (Michael Flanders) who made hit songs as part of the comic duo Flanders and Swann. Flanders senior’s efforts included “The Sloth,” “Mud, glorious mud” and “Bed,” on the delights of sleep and laziness.
Separately, Morgan Stanley Chairman and CEO James Gorman thinks things are looking up. Gorman expects banks to benefit from higher interest rates and less regulation, and possibly even an increase in market volatility. Your job may not be in jeopardy after all.
“If we get a more normal yield curve [the relationship between short-term and long-term interest rates], I’m bullish on the bank stocks. I’m not surprised the market is reacting the way it is,” Gorman said on CNBC’s Closing Bell.
Bank profits increase when long-term rates rise, making the curve steeper. In addition, better capitalization, strong liquidity and other conditions – including the Federal Reserve’s and other central banks’ plans to tighten monetary policy and the Trump administration’s deregulation proposals – make banks “primed for growth,” according to Gorman, who previously worked at Merrill Lynch and McKinsey & Co.
While financial stocks have not performed well in the S&P 500 this year, after the stress test’s second-stage results were released, bank stocks climbed while the broader market fell and the CBOE Volatility Index (VIX), a gauge of fear in the market, rose to its highest point since May 18, so Gorman may be on to something. Bank executives could see their already ample pay packages expand further.
“So we’re now coming into this period of real volatility. People are starting to take positions, and we’re seeing that action in the market,” Gorman said on CNBC. “We’ve had an incredibly flat yield curve, and I think this is perhaps the beginning of more normalization.”
However, the outlook is not so sunny for British banks, which could be on the hook for €15bn ($17.1bn) in costs to relocate certain activities to continental Europe after Brexit, and that could weigh on bank profits for years to come.
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How does Renaissance Technologies do it? 🤔 (Bloomberg)
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Photo credit: Bloomberg by Roman Kruglov is licensed under CC BY 2.0.