Okay so five down – (Marketing, Strategy, Org behaviour, finance, business economics), two to go (macroeconomics and Accounting).
They’ve been going okay so far but ideas of great marks are pretty much out of the window. I didn’t do enough work over the xmas holidays and have been realising this every day. But I feel like I’m on the home straight. I mustn’t lose momentum. I was feeling pretty stressed over last weekend but am finally beginning to get my head round financial statements which is convenient, given the exam is on Friday. Though I am taking fairlyhigh risk strategies in terms of the number of topics I am revising.
Business economics is not my best subject, but one of the most interesting. I answered questions on tax (what would be the effect of an increase on stamp duty) and externalities (should the price of cigarettes be left to the free market) and price discrimination (I talked about how companies can make more money by having entry fees and per use charges, and why sometimes you want to decrease the quality of software to make more money).
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.
—Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (1776)
Last term in Business Economics we watched a series of videos taped by the FBI of price fixing by multinational chemical companies (fixing the price of lysine, an industrial chemical). [BTW this counts as revision as I am learning about collusion for an exam on Monday] The quotation from Adam Smith has dated a little - law enforcement agencies (at least in the developed world) go out of their way to prevent and break up cartels.
What strikes me from the videos is how brazen they are. Little did they know that one of their number had gone to the FBI and was wired. In fact by coincidence they released a film recently about this called the Informant with Matt Damon.
They (that is, the real life ‘they’ - I don’t know what they did in the film) use a trade association as cover and Mark Whitacre, the informant, convinces the Japanese to meet in Hawaii - I assume this was so the FBI would still have jurisdiction. Whitacre convinces the Japanese guy over the phone by saying how good the golf will be.
There ate two main challenges for an effective cartel: actually agreeing on how to collude, and enorcing that agreement. On the first challenge lysine has many properties that may lead to a successful cartel:
it is a homogenous product.
The market is highly concentrated: the four largest firms control most of the U.S. and world markets, and the four largest buyers purchase less than 30 percent of the total market.
Buyers make infrequent, large purchases.
Entry is difficult because new plants are expensive, take a long time to build, and need skills
I feel compelled to write something good – the gospel according to me is that finance is beginning to make sense. I had a really reassuring session with a few classmates today that brought it into focus, working out what I had to learn, what it all meant and that there isn’t that much. Not that I will be getting full marks or anything, just that I can actually pass. The exam is on friday – 2 hours: half multiple choice questions and half long answers, and not much room for tactically missing out any topics.
The next stress inducer is accounting. I am sure this is actually a necessary phase in my preparation – crap myself so much that I eventually do something about it. A few of us had a session on business economics last week. We blithely began to do some of the past papers and we picked the furthest one back. As we began to work through the question, I felt a cold sweat and a stunned silence in the room. At least one of the group is really good and he was ploughing through it on the whiteboard but my life was flashing before my eyes. Luckily we discovered a few minutes later that an announcement had gone out that morning saying the syllabus had changed since that paper. In fact we had been taught the stuff to do the question, we just weren’t expected to know it for the exam.
…but I can’t seem to help it. I was just thinking how I had been posting consistently negative comments recently (sort of – I thought I was being positive about the british government making me the only person who is). So I’d resolved to post something happy and sunny. But then reality struck as I woke this morning.
Last night I had a full on nightmare about my exams. I arrived late to the exam, and it was in an old time classroom, with those desk/bench combos – I had to squeeze into the centre of a row and when I started the paper it was all dark and I couldn’t read the words, like I badly needed glasses. I managed to finish a question, but then the invigilator (the MBA Programme Manager) said time was up for the first section, but I had not finished by a long way. The next section was impossibly hard – I had to translate loads of binary numbers into english which I didn’t even know we were supposed to know how to do. And my eyesight was still really bad. I ended up bursting into tears and flinging my standard issue calculator across the room, and storming out complaining, at which point a friend of mine I haven’t seen since sixth form turned up to console me.
It actually isn’t too far from the truth in terms of my feelings of preparedness. I have four exams over the 2.5 weeks: finance, micro and macro economics, and accounting. They are very much my weaker areas. Anyway – I better get back to work. It’s good to be challenged, and it’ll all be fine. I think I’ve set impossibly high standards for myself and if I just get some perspective I’ll be fine.
It should a be a heartwarming sight. Back at Imperial I’m watching friends greet each other after the winter break, catching up on what’s been going on; some have exams or coursework deadlines so are working together in a spirit of teamwork…
But they’re doing it on the top floor of the library! aaaaaaarggghhh – p~#s off downstairs please!
My earplugs of choice are the disposable foam kind – basically very effective which is why you haven’t heard any rants from me since my last one. BUt they have the strange effect of magnifying sounds that travel through physical objects – so foot tapping and walking suddenly become like thudding drums.
…about the lack of preparation for snow in the UK! The next time someone says:
“A little bit of snow and this country grinds to a halt. In [insert country where it snows lots every year] we get much more snow and everything is fine”
…I will, I will… well actually I’ll smile politely and nod. But inside I’ll be like “Aaaaargh, how annoying!”
Now the UK government (local, national, all of it) is not perfect. But I don’t believe that it is so drastically more incompetent than comparable countries. The reason the transport system is heavily affected by snow is because it is not worth it for us to invest in snow ploughs, massive numbers of staff to run them, etc for what is usually a light dusting once or twice a year. For example, it usually gets to about about 30 degrees once a year. In 2003 it stayed around that for weeks. But it still doesn’t get hot enough, often enough, to justify all houses having air conditioning. If local authorities across the UK invested in enough snow preparations, only for expensive snow ploughs to lie dormant, most people would think it was a waste of money.
Now this is not to say it couldn’t have been handled better. But again don’t beat up on these guys too much. Everyone learns from experience, and we’re still getting there. Maybe if it does start snowing more we will start investig, but it’s not top of my list given the current deficit.
On another note, I used to a be a governor of a school, and that school closed when it snowed too much because of a shortage of grit – not because they were afraid of kids falling over, but because they were afraid of the legal consequences of kids falling over. That’s f***ed up.
PS this is a great photo of a sat nav with live traffic alerts yesterday in London:
Whenever I check my blog I get excited to see the number of new comments – but then realise they are just spam, sending me into fits of despondency and despair. Thanks to those who have commented on my posts. It makes my blog feel less lonely. Here are some of the more intelligible spam comments I have received – I still can’t fathom how it is really worth someone’s effort to generate these….
This weekend has been a blast man I have been obsessed with this full tilt poker game ive been playing. I didn’t even know about full title poker until the other night when my cousin invited me over to have dinner with him and his wife. Dude I stayed up all night playing it. I am almost embarrassed to admit [WTF?]
I luv your twitter icon, how did you make it? [I do not have a twitter icon - have no idea how to make one]
Pretty good post. I just stumbled upon your blog and wanted to say that I have really enjoyed reading your blog posts. Any way I’ll be subscribing to your feed and I hope you post again soon. [These ones really hurt when I realise they're fake - I can only dream of someone writing something this nice about me]
I am really enjoying reading your well written articles. It looks like you spend a lot of effort and time on your blog. I have bookmarked it and I am looking forward to reading new articles. Keep up the good work! [Again - heartbreaking, I do spend a lot of time and effort on my blog, only to have it degraded with fake praise]
Foremost, let me commend your pellucidity on this subject. I am not an expert on this matter, but after reading your article, my understanding has improved substantially. Please permit me to snatch your rss feed to stay in touch with any future updates. Pleasant job and will pass it on to supporters and my online followers. [I had to look up pellucidity - ironically it means 'easy to understand'. I do wish Ambrose would snatch my feed my more often. BUt I recommend that he stops using Google Translate]