I know who is going to win the world Cup, because JP Morgan has told me. If you don’t want to know, look away now. England. It’s England. You read it here first.
Presumably tired of being part of the profession widely regarded as responsible for all that is wrong with this world, the best brains at the bank have decided to use their powers for good. They’ve taken all the wizardry they use to read markets and applied it to the World Cup, to predict who will lift the famous trophy. And I, for one, cannot fault their logic.
The quantitative model they’ve devised comes with a seventy page explanation of both how it works, and how quantitative models can be fun (they can’t). In short, the model takes all manner of variables – form, odds, rankings, probabilities, consistency, national expectation etc. (but not metatarsal fiascos) – for each team, and reduces them, through a complex process of mathematics, into an unarguable truth.
And that truth is that on July 11th, on a balmy evening in Johannesburg’s beautiful Soccer City Stadium, a global audience of billions will watch as Rio Ferdinand’s England thrillingly triumph over Spain (on penalties, would you believe?) to lift the famous trophy.
Oh sure, it won’t be an easy ride to the finals for England fans, but then that is all part of the fun. After seeing old rivals Germany sadly crash out in a round-of-sixteen shocker against unfancied Slovenia, and a confidence boosting demolition of the French in the quarters, England will again take it to penalties to edge past the Netherlands in the semis.
Slovenia, incidentally, will have a wonderful run, improving trade and tourism ties with England no end by not only knocking the Germans out of the tournament, but also England’s other sworn footballing enemy, Argentina, in the quarter finals. Sadly, Spain will outclass them at the last hurdle before the final.
JP Morgan says the purpose of quantitative models is to “remove human based opinions from investment decisions,” which is clearly, in this case, a good and proper thing to do. The only thing to do. And the bank must know what it is talking about: its hedge fund division is the biggest hedge fund in the United States, worth some $53bn, and the bank says it only took the $25bn TARP bailout after the crash because it was forced to – that it could have paid it back the very next day if it had been allowed to.
And besides, when do hedge fund managers ever get anything wrong?
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Of course, JP Morgan’s model, fun though it is to believe, is wrong. We knew as soon as we saw Germany wasn’t in the final.
A quantitative model might be a master of the money markets, able to remove all human emotion from decisions, but the wonder of sport is its complete immersion in human emotions. And nothing is more emotional for millions of men, including the players, than the chance to lift that famous trophy. Maths – or the maths that say Slovenia beats both Germany and Argentina, at least – is the first casualty.
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Why do hotels still charge exorbitant amounts of money to make phone calls from their landlines?
I stayed in one recently, in London, (let’s call it the May Fair, because that is its name). I made 28 minutes of local calls. When I checked out, I was charged about $150 – charming.
I asked the manager by email why the price was so high, but he won’t respond to the question. It’s strange, because every hotel room in the world today seems to be filled with literature telling you how valued a guest you are.
But when you check out, a bill like this says more than any words about how you are regarded. Is there any excuse?Damian Reilly is the editor of Arabian Business.
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