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When I was contracting for some undisclosed financial company in Ireland I was doing some work around the building and one evening I was said there will be Dire

by funkyy 12y ago

When I was contracting for some undisclosed financial company in Ireland I was doing some work around the building and one evening I was said there will be Director coming from a meeting, so I should be around to open doors for him (I was only in the whole office atm) - the guy was pretty happy about deal so he started talking that he just made a deal for delivery of fleet of lease planes to some airline in EU. When I said the team must be really happy, he answered it is his own project, only few people in office knew about it. This illustrated to me that directors of finance companies can make multi billion deals and yet only few people knew about it... There was no teams working on it, bunch of risk management people trying to figure if this is worth it. Just one guy encouraged by few of his employees...

notahacker 12y ago
One of the major reasons why the finance industry works such ridiculously long hours is that small, arguably-understaffed teams are better at keeping secrets and maintaining client relationships and more easily held accountable for their errors. Aircraft leasing is a well-defined, finite market with most of the commonly-leased aircraft types having well-understood risk characteristics, and the lessors can and invariably do buy reputable independent opinions on market lease rates, residual values and empirical data on market activity (they can buy them by contacting me, actually :-) ) In many respects it's more risky to throw a large team at building a model to come up with a contrarian view. Needless to say, the airline will throw far more people at trying to ensure they can keep up with the lease repayments and bills from actually operating the aircraft and there are quite a few lawyers and technical consultants involved in the final signoff and aircraft redelivery. Similarly, some teams involved in supply chain management and business development at Maersk must have spent a vast amount of time figuring out the logistics of filling larger ships in future, which based on how little time the last generation of "biggest ships ever" stayed in service is a much bigger gamble than most airlines will ever make.
jpatokal 12y ago
Your finance guy didn't buy the planes though, he just sorted out the way the money is handled for the company that did. Still a pretty big deal, to be sure, but it's not his company that will go bankrupt if the end buyer can't figure out a way to fill up his planes at a profit.

by funkyy 12y ago

notahacker 12y ago

One of the major reasons why the finance industry works such ridiculously long hours is that small, arguably-understaffed teams are better at keeping secrets and maintaining client relationships and more easily held accountable for their errors. Aircraft leasing is a well-defined, finite market with most of the commonly-leased aircraft types having well-understood risk characteristics, and the lessors can and invariably do buy reputable independent opinions on market lease rates, residual values and empirical data on market activity (they can buy them by contacting me, actually :-) ) In many respects it's more risky to throw a large team at building a model to come up with a contrarian view. Needless to say, the airline will throw far more people at trying to ensure they can keep up with the lease repayments and bills from actually operating the aircraft and there are quite a few lawyers and technical consultants involved in the final signoff and aircraft redelivery. Similarly, some teams involved in supply chain management and business development at Maersk must have spent a vast amount of time figuring out the logistics of filling larger ships in future, which based on how little time the last generation of "biggest ships ever" stayed in service is a much bigger gamble than most airlines will ever make.

jpatokal 12y ago

Your finance guy didn't buy the planes though, he just sorted out the way the money is handled for the company that did. Still a pretty big deal, to be sure, but it's not his company that will go bankrupt if the end buyer can't figure out a way to fill up his planes at a profit.