10/16/2012 10:41 PM
Are you a curious person? Do you love learning new things just to know more about life and the world around you? I’m that way. In reflecting back on my classes so far, I realize how many new things I’ve been exposed to and what I’m taking away from this all. I only wish I could absorb an even higher percentage of the content that seems to be speeding by at 90 mph (or for my Canadian classmates, 145 kph).
I would have to say that my favorite classes so far are MLO (Managing and Leading Organizations) and BDM (Business Decision Modeling). While all of the classes have been fun and I’ve learned a great deal, the two mentioned above made me think and question my own understanding of what is going on in the world of business. They caused me to grapple with ideas and things I’d thought were truisms to see them in a more sophisticated or nuanced way. They challenged me in a fundamental manner that will cause to me apply my learning in everyday business life. And they gave me tools – tools I can use very pragmatically to make a direct impact on how I choose to deal with situations.
While the two classes are very different in nature – one is “soft” skills and the other “hard core quant”, the value for me in each of them is the way they’ve made me view things from a different perspective. That is so powerful!
My newest challenge is to learn about the world of Finance as we are in that class in the program at the moment. This whole world is foreign to me – the terms, the opportunistic mindset, the hedging, the wheeling and dealing of it all; at light speed. Being in the Manhattan cohort with several members of our team working in the financial sector, I’m lucky – I can ask very basic questions and my team will supportively help me understand the answers! I did have to laugh at my reaction to the opening session content. It was all about the notion of arbitrage (essentially trading something of value for something else of value to arrive at an overall equilibrium of pricing across a marketplace – seems reasonable) and the practice of short selling – seems “shady” to me! I’d heard the term short selling for years and thought I understood it to mean selling a stock for a lower price than….something – I wasn’t sure what. But I learned that it’s actually about borrowing from someone to sell their item, make a small profit and then returning the item to them (along with any fees for the privilege of using their item for a short time in order to profit from its sale). Along the way, there are a number of parties “helping” the transaction take place between lenders and borrowers of the item (in our examples it’s stock). The mechanics of this process are tricky to follow and my immediate reaction was ‘wow – there are lots of nooks and crannies in this process where people are taking a slice of the pie here and there’. Being a process geek, I’m skeptical of how streamlined and optimized this whole thing can be and I look for potholes. In talking with our professor I am learning that there are many checks and balances across the parties involved in the transaction, and several regulations and rules in play that do make this a ‘safe’ practice in the sense that it’s legal. It may or may not be a prudent way to spend/earn for everyone – but it is in my view, perhaps one of the purest forms of capitalism that exist at its core.
Being curious, I wanted to see if I could learn about where this practice of short selling comes from, and how it works. So, I searched on “short selling for dummies”. :). Below are the results. LOL - - I have NO idea how harmonica playing enters into this (perhaps you play the blues when you lose ;-) or why Canadians have a special form of personal finance different from the rest of us, but I think I’ll download the day trading book onto my Kindle to see if it has something useful I can learn.