The World is Full of Noise

Let’s face it – almost all of us succumbed to this temptation: we could do the toughest, most important task or we could break all of them into pieces (“eating the elephant” as the management gurus say) and start chewing them. Or just give in to the boss’ latest request and answer his (sometimes lazy) easy to dig emails.
In this world of digital enrichment, our human brains are spectacularly assisted and enabled to do so the work. Simple exercise: close your eyes and try to imagine how long and how many people you would need to achieve what you now manage in a working day… without laptops, internet and corporate cloud software solutions. Hmmm… not too much, right? Continue reading “The World is Full of Noise” »

Simplicient Financial Controlling – 1 – Laying the Ground

Let us face it – finance is not easy. Whoever tells you that the commercial financial management is a steady progression job, where one gets well trained and well paid over a reasonable number of career years, is trying to lure you into something. The finance specialism requires almost a decade of training (if you count a faculty/college degree plus professional qualifications plus specializations). Plus an in-commensurable amount of overtime hours and periodical work pressures (quarterly P&L targets or year-end closings speak for themselves).
Yet, it remains a wonder to me how over-complicated most finance processes are. Take any routine activity – you would expect 90% of them to be stable and running smoothly. Yet, the more you dive, the more details and complications hide behind. Obviously, this pushes the amount of work further up. And with the increasing pressure resulting from new (or amended) regulations, from ever-shifting processes (shared services or not) and from the ever-green chase for a lower cost base, finance is becoming more complicated every day.
Yet, it should not be the case. There are shortcuts. There are tips and tricks in controlling. These shortcuts come from the most unexpected place. They do not involve compromises on the decision-making quality. And long story short, I would like to share some of them here, so that this knowledge does not get completely lost.
So stay tuned and visit doitinvest.com from time to time for more simplicient controlling tips and tricks.

Post-modern Controlling vs Classical Financial Controlling

When it comes to financial controlling, many CEOs and even CFOs mention that it is boring. After all, controlling rotates around themes such as financials reliability and accuracy, predictability of the forecasting, solid safeguards in place, sound accounting, compliance. And immediately after this, the same senior leaders can be heard saying: “well, this way it should also stay”. Nobody’s hiring a controller to be creative and change the accounting standards, right?
Yet, when you browse through the job descriptions (and through the magazine interviews), the set of skills required looks different. Besides a long list of standard attributes (as per below), the differentiating factors ask for a different story. Many employers list (even in their performance reviews) required attributes such as:
– critical view on the business
– (being a) sparring partner for the CEO/business leader (maybe a hats down to characters such as Dr. Watson)
– change agent, especially for the local ERPs
– strong communication skills … and the list goes on Continue reading “Post-modern Controlling vs Classical Financial Controlling” »

How Will Terrorism Impact Investments in Europe?

If you have not heard about the March 2016 terrorist attacks in Brussels, you are probably not watching any news channels at all. But the chances are that you heard about the ISIS attacks in Belgium and the foiled plots to attack nuclear centrals in France or Europe.
What does this rise in terrorist attacks mean for the investments in Europe?
Well, first and beforehand, uncertainty and risk raises. Be it about real-estate investments in the European major cities (deemed to be one of the safest premium investments in the developed countries) or shares of the FMCG companies, there are obviously risks associated with purchasing shares of these companies: that is supply chains might be disrupted, key employees might be trapped or even harmed, or other countless factors might kick in. It means that overall the cost of doing business in Europe will increase: higher security costs money and slows down by travelling and communication, travel will be disrupted, insurance premiums will increase slowly but certainly. Continue reading “How Will Terrorism Impact Investments in Europe?” »

What is going on?

Looking at the status of the G20 economies, one might say nothing works. Keynesianism taken extreme has led to negative interest rates, moderate unemployment and no growth. Neo-liberalism generated uncontrolled banks, opinionated leadership and polarization of welfare. Trickle down economics do not work at all, especially if we look at the African or the Latam economics. Even the Chinese market-oriented communism is crumbling here and there. So now what?

European Bank’s Shares Shattered or Under-valued?

The last few days saw the European bank’s shares substantially going down. Deutsche’s Bank shares went down from around 25 EUR/share in December 2015 to 13,68 today (Feb 12th, 2016). Other German banks suffered also losses of 10-20% on their share prices, whilst French and Italian ones did not fare very well too. Most of the hit banks were from the invesmtent banking sector – but the traditional commercial ones have not been spared too. Unicredit, the biggest Italian bank, has seen a similar fate too (down from 6 EUR/share to 3).
This downfall share price trend is ggetting super-serious for the bank sector itself, badly hurt by multiple factors. Amid most concerns are the (relatively) capitalization rules, which requires the banks to maintain a higher capital-to-loans ratio – and most of these mammoths have failed on the stress tests. Of course, this is a measure of efficiency – and most of the investment banks are trying hard to keep as low a ratio as possible, since this means for them doing business with other’s (mostly central banks) money/funds. A nice business model indeed for the banks, who have become mostly asset managers, rather than loan-making machines. Continue reading “European Bank’s Shares Shattered or Under-valued?” »

Why the Housing Market in Anglo-Saxon Countries Will Further Boom

Recently I was reading an interesting article on The Economist about the UK housing market. Whilst I do not agree with 100% of it (after all, the real estate markets have gone through various historical cycles), it is a well-argumented read. It basically says that whilst subventions via free land for the constructors might help, the housing market still has a huge inertia and might continue to grow.
One interesting extra argument (from my side this time) – the quantitative easing has introduced to the US/UK markets a lot of liquidity, which is not yet absorbed. As the liquidity will hardly find its place in new investments, it might find a safe cushion in the real-estate investments. One more reason why this might continue to be a good long-term investment.