Ravi, in Conversation

Though the finance sector has seen an erosion of jobs, I believe that this is short-term, and just one of the side-effects of being greedy and not focusing on the bigger picture – going too thin to get too deep, whether it is into progress or into calamity. In other words, my premise is that we are limiting a lot of our energy and effort into a subset of economics, viz. finance, without considering the macro-economic implications and micro-economic fundamentals that lie embedded in the time value of money.

The debate between the behavioral economists and the quantitative economists has been widening as new events unfold, and we find ourselves scampering around for all-encompassing explanations and accurate predictions of the future. We still lack an understanding of what we have ourselves created in the likes of asset-backed securities and credit default swaps, their implications, and why we failed to predict what was coming. We do not know what a drop in the interest rates mean, or where the 700-billion dollar bailout package is going to end up. This, I would argue, implies that an influx of fresh talent into finance is increasingly necessary. We can smell opportunities for budding finance professionals who have the credentials to take a long-distance satellite snapshot in order to drill deeper, by effectively integrating other fields of management, literature, history, psychology, biology and technology into our financial thought processes – which essentially means that our future finance practitioners need to come from all other areas of art and science. It is also necessary that these minds are given ample freedom to break-out of routine models to build integrative approaches that can stand the tests of time.

The BRIC economies are all the more in need of such talent that has survived and understood turmoils such as the one we currently face, since these nations would want to progress without struggling at the same stumbling blocks as the present-day US economy does. For instance, in a sector like energy, we can expect huge infrastructure investments in India and China in the days to come (remember the Indo-US nuclear deal, and GE's investment) and we need financial talent to channelize and manage these investments on the basis of interdisciplinary knowledge rather than complicated spreadsheets.

I am not sure whether we will find jobs in such interdisciplinary areas in the near future, but this is certainly going to be the long term trend. So, the best thing for finance professionals to do today is to read, think, understand and prepare oneself for the future. I would suggest to everybody, myself included, to accept jobs that can take us a step nearer to where we want to be, rather than stressing ourselves out because we didn’t get what we set out to achieve.

The same way as a language will survive as long as (wo)men want to communicate, finance will remain as long as (wo)men want to transact.