To apply the Socratic method successfully requires students to be somewhat interested in the questions.

Sir, with respect to Lucy Kellaway’s "End of Term Diary” (December 23), David Parker writes: “It’s the teacher’s job to facilitate and motivate. Show students the beauty of things. And, teach by the Socratic method. Ask a question. If the student doesn’t understand, ask another question. Keeping asking. When they understand, they’ve learned” “Teach by the Socratic method — keep asking” December 30.

I have tried to apply the Socratic method during years trying to make Financial Times understand the mistakes of risk weighted capital requirements for banks. Among the questions:

Why do regulators require banks to hold more capital against what has been made innocous by being perceived as risky, than against what has become dangerous by being perceived as very safe?

Why did regulators not define the purpose of banks before regulating these?

Why did bankers use as input for their risk weighted capital requirements for banks the intrinsic risks of bank assets and not the risk of those assets for the banks?

Why do regulators not understand that allowing banks to leverage differently with different assets will distort the allocation of bank credit? And, if they understood that, who gave them the right to distort? Etc. 

But FT shows no interest in these questions… so I have to find another method… any idea Lucy Kellaway?

@PerKurowski

Church organists, lapdancers, Uber drivers. What follows? Some Prime Ministry gigs?

Sir, in this day with so much dourness, it really brightens up the day to read such a solid British humored phrase as Sarah O’Connor’s: “Does Britain really want to be a country that defines its chocolate gingerbread men more carefully than its 32m-strong workforce? “Blurred job definitions serve nobody’s interest” June 28

What fun article. Many thanks. As I see it Sarah, or Ms. O’Connor, I am not sure on how to refer to her, could be greatly qualified to console us FT’s readers after the announced retirement of that equally good-humored gem that is Lucy Kellaway.

Now when she writes: “Before Uber drivers were compared with lapdancers, those lapdancers were compared with church organists” might she be implying a strange progression into a sort of underworld? If that’s the case, it would be interesting to hear what she believes could come after Uber drivers. Perhaps some Prime Ministry gigs?

But down to the business of the blurriness of definitions: To me, if you work when you want you work, in such a way you want to work, and nobody but you impose some specific targets that need to be achieved, then you work for yourself. If you work when someone else wants it, according to some imposed unnatural standards, or you must meet some clearly specified work targets, then you are an employee.

By the way, does Uber require any minimum number of drives per month?

PS. But what we most might need, is decent and worthy unemployments

@PerKurowski

Contrary to Gordon Brown, current bank regulators do not dare to take questions, they might not be able to answer

Sir, as truly responsible elite should behave, Lucy Kellaway takes society at task with her “There is nothing cute about innumeracy” May 8.

In it Kellaway refers to how a kid, almost 20 years ago, asked Gordon Brown, then Chancellor of the Exchequer, “what is 13 squared?” and got a correct answer.

I argue that the current risk weighted capital requirements for banks are dangerously nonsensical, and that is why I have been asking bank regulators many questions about these, during about 20 years too. I have not had that kid’s luck.

For instance, when I ask why they give what is AAA rated, that we know banks could be building up dangerous exposures to, a risk weight of only 20%, while the so innocuous below BB-, that which bankers would not touch with a ten foot pole, is handed a 150%, their eyes go blank, and they nod to each other either “what the hell is he talking about?” or “does he not understand that risky is risky and safe is safe?”

If I ask them how much they feel authorized to distort the allocation of bank credit to the real economy in pursue of an elusive financial stability, then they ignore me completely.

Frankly, how can a society allow its banks to be regulated by those that, knowing as they should that bank capital is to be there to cover for the unexpected, are so dumb so as to base their capital requirements on what’s expected?

Here follows a link to some of my many questions that have never received an answer.

http://subprimeregulations.blogspot.com/2016/12/must-one-go-on-hunger-strike-to-have.html

How is it that “Without fear” FT, contrary to that young kid who asked Gordon Brown, does not dare to ask bank regulators these questions?

@PerKurowski

Lucy Kellaway, what does FT’s code of conduct say about hushing up someone who sees something bad and says something?

Sir, I refer to Lucy Kellaway’s “Codes of conduct are in breach of common sense” March 27.

It would be great if Lucy Kellaway would go thru FT’s code of conduct in order to explain to me whether it contains something that instructs FT’s journalists from not asking the regulators the questions that must be asked, in order to try to make some sense of what they are up to.

For instance: For their risk weighted capital requirements for banks the Basel Committee has assigned to the AAA to AA rated a risk weight of 20%, while for the below BB- rated one of 150%. Why on earth do they believe what’s below BB- rated and therefore made so innocuous, is more dangerous to the bank system than what’s AAA rated and which therefore could lead to the build up of really excessive and dangerous exposures?

That only guarantees that the safe will get too much credit against banks holding too little capital and the risky, those who are just as worthy borrowers, will get much less or much more expensive access to bank credit than usual. That is bad! That is why, when I saw something, I said something, in about 2.5k letters to FT. 

But perhaps Lucy Kellaway must keep silent on this, since she includes in her own code of conduct, “Don’t do anything that you would be ashamed to tell your colleagues about.”

http://subprimeregulations.blogspot.com/2016/12/must-one-go-on-hunger-strike-to-have.html

@PerKurowski

What a shame Lucy Kellaway missed teaching her finance expert colleagues in FT, to spot bullshit at 50 paces.

Sir, Lucy Kellaway no matter how she has educated her daughters in other aspects, something which I father of three might discuss, has all the right in the world to be very proud to have helped them “to spot bullshit at 50 paces” “How I help my children navigate their life journeys” March 13.

If she had taught the same to her finance expert colleagues in FT then they, upon seeing a risk weight of only 20% for what is so dangerous to the banking system as what is AAA rated, and one of 150% for the so innocuous below BB- rated, would have stated “What a BS!” and then the world could have looked quite less messier than now.

@PerKurowski

Dear Sir, using your extraordinary savoir-faire and FT’s immense influence, please educate our bank regulators

(I will try it the Lucy Kellaway way “How to ask for what you want — and get it every time” February 6.)

Sir, the world needs for you and your astonishing influential paper, as always without fear and without favour, to inform bank regulators about that their current regulations is based on a fundamental mistake, a sort of the mother of all “alternative facts”; namely that what is AAA to AA rated, is much safer for the banking system than what is rated below BB-.

That, in their standardized risk weights, has caused them to assign a meager 20% risk weight to the very dangerous AAA-risktocracy and 150% to those made so innocuous by being perceived ex ante as very risky.

Most probably because I am so unimportant, I have not found a way to transmit to the regulators the real truth, namely that excessive exposures to what was perceived as risky when placed on banks’ balance sheets have never caused a major bank crisis. That dishonor belongs to unforeseen events (like devaluations), criminal behavior, and to what was ex ante perceived as very safe but that ex post turned out to be very risky.

But Sir, with your importance and extraordinary savoir faire I am sure you would be able to reach out to them, discreetly if you so wish.

When you do, the world will owe you immense gratitude because, as is, this mistake has created such distortions in the allocation of bank credit to the real economy that our banks are no longer financing the riskier future our children needs to be financed, but only refinancing the safer past and present.

If they are too hardheaded and you need some backup argument, you could always quote Voltaire to them “May God defend me from my friends, I can defend myself from my enemies”

Yours always, admiringly and cordially

Per Kurowski

PS. Here some of my questions the regulators have refused to answer.

Math teacher Lucy Kellaway, before leaving FT, please explain to bank regulators the difference between a sum and an average

Sir, Lucy Kellaway stuns us announcing she will be leaving FT in order to teach some inner London students math. “It is almost goodbye from me and I want you to join me”, November 21.

Though I am not sure why she can’t write articles and teach math at the same time, her readers will sure miss her and her students most certainly welcome her.

That said, and given she must obviously know math and have some pedagogical proficiency explaining it, I sure wish that, before leaving, she would have a go at explaining to current bank regulators, the difference between a sum and an average.

In banking, the amount of credit and the interest rate charged on any credit is basically the result of the average bankers risk aversion to any average perception of risk. Were bankers to add up their risk aversion, then just the safest of the safest might get some tiny piece of credit and all slightly riskier would be totally left without.

Which is why, when bank regulators, to the bankers’ risk aversion to perceived risk, added by means of the risk weighted capital requirements for banks their own risk aversion to basically the same risk perception, they distorted all common sense out of the allocation of bank credit to the real economy.

For more than a decade I have tried to explain this to regulators, with no luck. Perhaps Lucy Kellaway would be able to find better words. We sure need our bank regulators to understand the simple fact that any risk, even if perfectly perceived, causes the wrong responses, if excessively considered.

@PerKurowski

Lucy Kellaway, how should guilty bank regulators apologize and be held accountable?

Sir, I refer to Lucy Kellaway’s “Wells Fargo’s wagonload of insincere regrets” September 17, only in order to ask her a question.

Here is a link to my unasked for testimony on the causes of the bank crisis 2008

http://subprimeregulations.blogspot.com/2016/09/if-ever-allowed-following-would-be-my.html

If I am correct, how would Lucy Kellaway suggest the guilty bank regulators should apologize… and how should they be held accountable?

@PerKurowski ©

And we must also stop regulators, like those in the Basel Committee, from being so damn creative

Sir, I refer to Lucy Kellaway’s “The plague of compulsory creativity may be dying out” September 12.

She is absolutely right in what she there argues, but she could have added power to her arguments by identifying when empowering creativity, can lead to some truly dangerous creativity, and cause huge disasters.

Think for instance of the bank regulators in the Basel Committee. Based on the very creative theorem that what is ex ante perceived as risky, is riskier for the bank systems than what is perceived as safe, they created the risk weighted capital requirements for banks; and with that they seriously distorted the allocation of credit to the real economy,

And now the safe havens are becoming dangerously overpopulated, while all the risky bays, where SMEs and entrepreneurs reside, are equally dangerous being underexplored.

@PerKurowski ©

If anyone in FT is living up to FT’s motto of “Without fear and without favour” that’s Lucy Kellaway

Sir, again, Lucy Kellaway is bravely shouldering her responsibility to socially sanction nonsense. That kind of sanction is extremely important, effective and much needed. Way to scarce nowadays. “Millennials ought to ignore career advice from BCG boss”, August 8.

How I wish she would help me out to socially sanction the bank regulators who came up with the loony concept of risk-weighing the capital requirements for banks, and, in order to keep the bank system safe, to assign a risk weight of 20% to what is AAA to AA rated and of 150%, 7.5 times larger,  to what is rated below BB-.

All as if the world of the ex ante perceived as highly speculative risky below BB-’s, pose greater dangers for our banks than what is ex ante perceived as prime and absolutely safe.

@PerKurowski ©

What makes me most nervous about Brexit is seeing how so many of the expert’s elite have gotten the willies.

Sir, you can all count yourself lucky at FT for having coolheaded Lucy Kellaway as a colleague. When she indicates, “The 10 minutes we debated high heels on the radio were the sanest minutes I’ve had since the referendum” she is telling the world that there still are some reserves of “stiff upper lip” in Britain, "My advice is to carry on, whether you are calm or not", July 4.

Thank God for that. If you are to handle the Brexit process reasonably well, the last thing you need is for that to be done by those who seem to have gotten down with some serious heebie-jeebies.

@PerKurowski ©

To survive we need to be smarter than smart products; like “Walking the Fitbits”

Sir, Lucy Kellaway writes about the ever increasing number of products supposed to help us manage intelligently many daily chores “We need more smart products because we are stupid” June 13. I think she has missed a very interesting point, namely our efforts to beat these products because we’re smarter.

For instance children who are concerned with their parents not walking enough have furnished many of us a Fitbit... for many of us a torture instrument. That represents a great market opportunity for hackers or app developers who find a way to surreptitiously multiply the number of daily steps taken. I am currently working on a more basic method I call “Walking the Fitbit”. It very simply consists in a group of neighbors organizing themselves to take turns walking each other’s Fitbits. I can already see before me seven Fitbits gladly sharing the same arm… while six happy walkers take a day off. 

We will survive!​

@PerKurowski ©

Lucy Kellaway is sure lucky a Basel Committee for Transport Supervision does not regulate her cycling.

Note: I just added a PS that might explain the letter better.

Sir, I refer to Lucy Kellaway’s “I want to get back on my bike in spite of the dangers” April 25.

The Basel Committee for Banking Supervision decided banks need to hold more capital, which is like a sort of tax, whenever they lend money to something risky, like to SMEs and entrepreneurs; and this even though banks charge higher risk premiums and give smaller loans whenever engaging with the risky.

And so it does because even though “the risky” are clearly riskier individually to banks, the BCBS ignores that it is those perceived as safe but that could turn out risky, which represent much greater danger to the banking system. 

So lucky Lucy Kellaway, that a Basel Committee for Transport Supervision does not regulate her cycling. Because, if it did, she would be taxed by much more than the “to avoid car doors and lorries turning left [and] wear all the safety gear” she taxes herself with when riding a bike.

And that because, like the BCBS, a BCTS could similarly regard cycling as much more dangerous than any other means of transport, even though most other means of transport, for instance cars, certainly cause more deaths in London than those “more than a dozen cyclists die each year” Kellaway refers to.

So if Lucy Kellaway had to pay a BCTS cycling tax, she might not get back on her bike, and she would then feel “angry, depressed, cynical, possibly prone to heart attacks and musculoskeletal disorders”… a bit like the banks and our economies end up feeling after being submitted to BCBS’s dumb rules.

PS. An alternative explanation is that the Basel Committee for Transport Supervision would pay Lucy Kellaway and the rest of Brits a subsidy in order for them to safely travel immobile on their bottoms and avoid the risks of cycling. Would Britain be better for it?

@PerKurowski ©

“Listen, do not forget that you are the millenial here, and so you are the one supposed to know”

Sir, Lucy Kellaway, enjoyable as always to read, discusses the jobs of millenials, and recommends managers to give them “something interesting to do, or at least be able to explain why filling in that particular spreadsheet really matters” “Don’t blame millennials if you can’t hang on to them” April 11.

Though that presumes the manager knows why the spreadsheet is filled out, which is definitely not always the case, it sounds like very good advice, something like “wash your hands and brush your teeth”

But if I was a manager confronting a recently hired unknown millenial, one of those who can find it interesting to spend hours on what seems utterly un-interesting actvities to me, I would suggest a more forthright approach:

“Look here young friend, I am giving you these spreadsheets to fill in. Try to figure why, and if you in the process find that something better could be done, tell me. Do not forget that you are the millenial here.” 

@PerKurowski ©

Does anyone see the grey showing on the roots of Lucy Kellaway’s hair or the smear of icing sugar on her leg? Not me!

Sir, you know I am usually a great admirer of Lucy Kellaway’s writings, but, this time, I think she’s got it wrong. “High heels and boxing gloves: a portrait of women at work” March 21

Kellaway writes: “If a company wants to show that it really values women and wants to prioritise action in the gender equality landscape, it will show pictures of them in which they don’t always look cool or gorgeous. They just look like professional women at work.”

Hold it there, my wife is a great lawyer, and she has never ever expressed to me any concerns about any type of discrimination based on gender; if anything she has lately felt, ever so slightly, more burdened by age. But, no matter how she looked at work (always gorgeous of course), she would always, no exceptions, prefer to be depicted as if not at work.

And we men are instinctive survivors. We know perfectly well we should never ever take photos of any woman, including Lucy Kellaway, with “grey showing on the roots of hair and a smear of icing sugar on leg”.

PS. The following is absolutely no opinion, especially not mine; its just a question:

Is there anything as deflationary as women willing to work for less? If women did not work, and stayed home to binge on over 100 episodes shows, then unemployment rate would be lower, salaries higher, and so central banks would get the higher inflation they desire and so allow us higher interest rates, and so we could all have a chance to earn a bit on our savings to cover for our retirements. Matching life styles with the economies is always challenging… so they say.

@PerKurowski ©

Lucy Kellaway is my large glass of wine that keeps me suscribing to FT and writing letters to its (quite dumb) editor

Though that would clearly be highly unethical journalistic behavior, it is clear that someone somehow must have issued a strong, very strong, recommendation to ignore my letters to the Financial Times.

And obviously that should have me raving mad and cancelling my suscription to FT.

But it is when I read something so great like Lucy Kellaway’s

“The reply consisted of one word: Noted. This was the perfect passive aggressive response. It was just about polite enough for me to have no legitimate grounds for complaint. It shut down the discussion, and left me with only one sensible course of action — to pour myself a large glass of wine and see”

... that all is forgotten. That it is just the kind of my large glass of wine that keeps me suscribing to FT... and keeps me writing letters to You Dear Editor.

With my very best regards

Per Kurowski

PS. I sure hope and pray this will not create any trouble for Lucy Kellaway. Sir, I swear she’s innocent!

@PerKurowski ©

At least Lucy Kellaway defends with honor the “Without fear and without favor” motto of the Financial Times

Sir, Lucy Kellaway does great living up to “Without fear and without favor” when she socially sanctions all the full of themselves experts, and those who socially suck up to these. Well done! “Boneheaded aphorisms from Davo’s windy summit.” February 1.

It is a real pity there are not many more like her at FT. The world could benefit a lot if the journalists at FT dared to, for instance, question more current bank regulators on what they are up to… like for instance with their zero risk weight to sovereigns and the 100 percent risk weight for that private sector that makes the sovereign strong.

@PerKurowski ©

That’s it Lucy Kellaway. Keep them honest.

Sir, setting of course aside the pay package of £8.25m a year, I would not like to be in Jes Staley shoes having to face those who when meeting him discreetly look away after having read Lucy Kellaway’s “Barclays boss needs to ditch his inexcusable focus on value”

Good for her. To reveal haughty arrogant stupidity among the powerful is the absolutely most important role journalists have.

That’s the “Without fear and without favor” spirit we expect from the Financial Times. I have sure been missing a lot of it lately.

@PerKurowski ©

Could one sue one’s Alma Mater for a partial valueless education, in order to pay back part of one’s student debts?

Sir, it is hard to know what to do with the so astounding information that Lucy Kellaway provides us with: “Over the past 10 years the 17 valueless companies have outperformed the others in the FTSE 100 Index by about 70 per cent” “Hands up if you can list what your company’s values are” October 5.

First question would have to be to clarify whether those results means valueless as in absence of values, or, hopefully, valueless as in absence of declared values.

The second, if I may, would be to try to figure out how much debt MBA students around the world have taken on, in order to learn about the extreme importance of declaring corporate values. Maybe there is a valuable class action lawsuit against their Alma Maters coming down their way.

@PerKurowski ©  J

When risky things turn out risky, they turn out as expected. It is in what’s “safe” where the real unexpected dangers lurk

Sir Lucy Kellaway when referring to Sergio Ermotti, the chief executive of UBS, telling “all the bankers who work for him that henceforth it was OK for them to make mistakes” writes: “Mistakes are never OK. And they are particularly un-OK in banking” because… “The main point about risks is that they are risky — and risky things have a way of going wrong.” “Listen to brain surgeons, not bankers, for the truth on errors” September 27.

Not so. When risky things turn out risky, they are actually turning out right as expected… it is when safe things turn out risky, that things can really go wrong.

And Kellaway argues: “What Mr Ermotti should have made clear was that sometimes his employees must take risks, and sometimes things will go wrong. When that happens, no one must ever make light of their cock-ups. Instead they should carry the memory of all their mistakes as part of their own internal score sheet of how they have fared as a banker.”

Indeed, but the greatest cock-up in banking history, a cock up so big that it is being frantically ignored, was the one made by bank regulators. It happened when they allowed banks to hold much less capital against assets perceived as safe, meaning against those assets that precisely because they are perceived as safe, represent the biggest danger to the banking system.

Lucy Kellaway, I am sorry, I have no idea why we would need to listen to brain surgeons for the truth on errors… even a bank regulator who knew what he was doing, should know that.

@PerKurowski