Capital Read Free Page A

(Harrow) and a good university (Durham) and got a good job (in the City of London) and been perfect in his timing (just after the Big Bang, just before the City became infatuated by the mathematically gifted and/or barrow boys). He would have fitted seamlessly in the old City of London, where people came in late and left early and had a good lunch in between, and where everything depended on who you were and whom you knew and how well you blended in, and the greatest honour was to be one of us and to ‘play well with others’; but he fit in very well in the new City too, where everything was supposedly meritocratic,where the ideology was to work hard, play hard, and take no prisoners; to be in the office from seven to seven, minimum, and where nobody cared what your accent was or where you came from as long as you showed you were up for it and made money for your employer. Roger had a deep, instinctive understanding of the way in which people in the new City liked reminders of the old City as long as they showed that they also accepted the new City’s way of doing things, and he was very adroit at signalling his status as someone who would have been at home in the old world but who loved the modern one – even his clothes, beautifully made suits from a wide-boy, Flash Harry tailor just off Savile Row, showed that he understood. (His wife Arabella helped him with that.) He was a popular boss, who never lost his temper and was good at letting people get on with things.
    That was an important skill. A skill worth a million quid in a good year, you would have thought … But it was not straightforward for Roger to calculate the size of his bonus. His employer, a smallish investment bank, did not make it straightforward, and there were many considerations at work to do with the size of the company’s profits overall, the portion of those profits made by his department, which traded in foreign currency markets, the relative performance of his department when compared with its competitors, and a number of other factors, many of them not at all transparent, and some of them based on subjective judgements of how well he had performed as a manager. There was an element of deliberate mystification about the process, which was in the hands of the compensation committee, sometimes known as the Politburo. What it boiled down to was, there was no way of being confident about what the size of your bonus was going to be.
    Sitting on Roger’s desk were three computer screens, one of them tracking departmental activity in real time, another being Roger’s own PC, given over to email and IM and video-conferencing and his diary, another tracking trades in the foreign exchange department over the year. According to that they were showing a profit of about £75,000,000 on a turnover of £625,000,000 so far, which, although he said it himself, wasn’t bad. Simple justice, looking at those numbers, would surely see him awarded a bonus of £1,000,000. But it had been astrange year in the markets ever since the collapse of Northern Rock a few months before. Basically, the Rock had destroyed itself with its own business model. Their credit had dried up, the Bank of England had been asleep, and the punters had panicked. Since then, credit had been more expensive, and people were twitchy. That was OK as far as Roger was concerned, because in the foreign exchange business, twitchy meant volatile, and volatile meant profitable. The FX world had seen a number of fairly self-evident one-way bets against high-interest currencies, the Argentinian peso for instance; some rival firms’ FX departments had, he knew, made out like bandits. This was where the lack of transparency became a problem. The Politburo might be benchmarking him against some impossible standard of profitability based on some whizz-kid idiot, some boy racer who had pulled off a few crazy unhedged bets. There were certain numbers which couldn’t be beaten without taking what the bank