On the 25 June 36 Remove Economists visited three very different type of financial institutions in the City of London. The trip was aimed at helping the boys learn more about finance, and the working of the Bank of England. Not only will this knowledge help the boys in their studies next year, but it should also help them to make more informed career choices.
The first place visited was BlackRock, one of the World’s Leading Asset Management companies. The boys enjoyed a talk on what asset management is, who their clients are, and the company’s strategy for getting good returns in a time of enormous uncertainty in the global economy, where investors are finding it hard to locate strong investment positions. At a time when many of the boys are considering their next move in terms of universities, and future careers beyond that, it was fantastic for them to hear from four graduates recently recruited by BlackRock who told of their choices for A-levels, degree choices, and their route into asset management. After the talk the speakers commented on how impressed they were by the insightful nature of some of the questions asked by the boys.
Next, we walked East, to the London Metal Exchange (LME). The LME boasts an impressive 80% of all metal trading in the World, but as the boys learned during a talk in the boardroom given by the Deputy Director of Marketing, trading in the right to buy metal (futures/options) dwarfed the value of the physical product actually purchased. A staggering $15 trillion of options trading takes place at the LME in a single year. After learning about mining, metal trading and all of the complex financial instruments that come with it, the boys went down to the viewing gallery which overlooks the last open outcry trading floor in the City. There, they watched buyers and sellers shout incomprehensible instructions at each other in a way that only an insider could possibly understand, but the passion and sheer volume on the trading floor was quite remarkable.
After an hour to enjoy lunch on a bright summer’s afternoon, the boys went to the Bank of England Museum. Here they learned about everything from ‘what is money’, to ‘how does Quantitative Easing work’, as well as having the opportunity to learn about the Bank’s history. However, the obvious highlight for most was picking up a solid gold bar, and being hugely surprised by it’s deceptive weight.
Mr Nick Fyfe
Head of Economics & Business Studies