TO THE TEAM
“With the talent at the firm and “With the talent at the firm and our combined resilience, the our combined resilience, the future remains bright” future remains bright”
Richard Iley
Partner and Chief Economist Asia & Europe
“If you can dream and not make dreams your master; If you can think and not make thoughts your aim; If you can meet with Triumph and Disaster and treat those two impostors just the same;”
If – Rudyard Kipling
The above is a snippet Rudyard Kipling’s famous poem “If”. Like many things today, Kipling, the scribe of the British Empire, is now
deeply unfashionable but his admonition for equanimity in the face of success and failure nonetheless remains timeless advice
Tennis fans may know that Kipling’s words
are famously still inscribed on the walls of the All-England Lawn Tennis Club and it was in the context that I first become aware of these lines My then hero, Boris Becker –like Rudyard Kipling, no longer in fashion today! - had just lost his ever first match at Wimbledon, beaten, after back-to back titles at the age of just 18, by an unknown Australian called Peter Doohan in the first round when seeking a third successive title.
The BBC commentator quoted the Kipling lines as a shell-shocked Becker was whisked off in his limousine, noting that if
he can take the poet’s advice on board, he will come back stronger than ever Becker of course did come back, winning another six Grand Slam titles and, in turn, cementing legendary status in the game
Daniel Schneider, apparently once a handy tennis player himself, has often talked about how the performance mindset that elite sportspeople demonstrate, is needed at SPX. At both the elite sport level and in SPX, a high level of talent is a given as are entrenched work ethics It is grit and resilience in the face the inevitable shocks and setbacks, Shakespeare’s “slings and arrows”, that ultimately separate the greats from the also-rans. As we look to move forward to this year after a challenging 2023, Kipling’s call to embrace both setbacks and successes in level-headed fashion is as relevant as ever as we continue to knuckle down.
Before looking ahead, it is traditional to glance back and share with the firm some elements of my SPX “story” This began back as far as 2017 when I visited SPX as a client when I was chief economist for Asia and Emerging Markets on the sell-side at BNP Paribas. I have two strong memories (that I am prepared to share!). First, it was a tough meeting – a forerunner of later internal “committees” – with hard, detailed questions and a level of expertise in the room on Asia that I had not expected in South America. Second, I was taken to dinner with SPX at the racecourse and eat possibly the largest steak of my life which I sometime feel that I am still digesting.
Fast forward 18 months or so and I was approached over the role of Chief Asia economist at SPX in London. The timing was propitious. After nearly 20 years on the sell-side and nearly 10 years in Hong Kong, I needed a new challenge and jumped at the chance The opportunity of joining a small, but growing, company and help the drive to expand its footprint outside Brazil by bringing in global talent was appealing. The opportunity for continual, robust, hi-altitude macro discussion of the sort that I had experienced in Rio and, above all, greater intellectual freedom away from the inevitable political constraints of large global banks, was also a huge draw.
The recruitment process was slow but thorough and on my side involved both jungles (Myanmar) beach (South Australia) and desert (Qatar) as I tried to work through and accelerate the process around my (then crazy!) travel schedule One memory was trying to discuss the Australian balance of payments with Bruno from Myanmar with the worst phone line you can imagine. The line was so bad that I ended guessing his questions and answering anyway. I suppose that Bruno probably also guessed my answers, no doubt greatly helping my chances!
After several twists and turns and a final day of interviews in Rio, SPX offered me the role and I started my career here in the London office back in December 2018, leaving my family at least for the time being back in Australia. I like to think that I
started as I meant to go giving my first China committee on my first afternoon (albeit with someone else’s slides).
The last five years have been a blur involving Covid, making partner, an expanded Asia team, my family eventually joining me in the UK and the opening of the Singapore office as SPX’s globalisation drive continues, are edited highlights
Some of best memories came in the darkest moments I was frequently the only staff member in the London office for periods during Covid although Bruno and James Brilliant would also often be in the office While lockdowns seem increasingly like a distant dream, the Covid 3 in London all feel a certain nostalgia for those crazy days. Another highlight has been the opportunity to recruit Mole Hau to work with me again on Asian macro after a long collaboration in Hong Kong and giving him and his family the opportunity to build a new life in the UK
More fundamentally, SPX continues to have the culture of robust, honest hi-altitude macro-economic analysis and debate that first strongly attracted me to the firm and is of course essential I believe to our success and ability to generate true Alpha.
The shock of Covid undoubtedly stressed the model and, as we saw with wider society, risked a retreat into intellectual silos and reduced engagement and communication However, we are clearly back on track and newer members of the firms are now experiencing and benefitting
from better attended Committees with robust discussion and debate in classic SPX fashion.
At the start of my career at SPX, a senior partner gave me some advice at that year’s Christmas party He told me that the firm just wanted me to be honest. That was music to my ears and fitted with my research philosophy: always tell your clients what they need to hear, not what they want to hear. Popularity is a long game and will not sustained, nor will our P&L, by intellectual snake-oil.
The other side of the coin of intellectual honesty is also acknowledgement of errors and, crucially, a willingness to promptly mark our analysis “to market” when the facts either change, or we see them more clearly This dynamic is equally key to our success and must be a key differentiating factor between our research and that of the more cumbersome and frequently dishonest sell-side offerings
At root, like any organisation, however SPX’s ultimate strength is its people And this is the truly good news and cause for optimism. The enormous talent and deep well of human capital that the firm possesses and continues to attract is undoubtedly our biggest asset
I can honestly say that I have worked with some of the brightest and best of my career in my time at SPX (and that includes my first two bosses at the British
Treasury who are currently both Deputy Governors of the Bank of England!) To spare blushes, I won’t name names but I have lucky been enough to have some of the these key talents working on my team, at least until the tractor beam of the trading desks dragged them away!
Last year notwithstanding, the firm’s growth and success remains non pareil and testament to the vision and leadership of Rogerio, Bruno, Daniel, Leonardo and latterly Marcelo When I joined in late 2018, the London office was just around 15 people vs. around 45 now. An Asia office was distant pipe dream but now that is reality with research and PMs under the leadership of William Bethlem
Looking forward to 2024 and beyond, Kipling’s words ring truer than ever 2023 was challenging year as we all know but I have no doubt that, with the talent at the firm and our combined resilience, the future remains bright and SPX’s continued for push for growth and success remains firmly on track.
