Spread betting is an account grouping that permits traders who are UK occupants to use the forex market with a tax-free framework, which means capital additions are not taxed by the UK government. From an exchanging and execution point of view, there’s no contrast between the forex exchanging account and spread betting account. A similar stage is additionally utilized for each. Several Uk based forex managed accounts

Spread betting is sans tax because of the UK tax code. So on the off chance that you live in the UK, at that point, it’s to your greatest advantage to exchange a spread betting account. The pip an incentive on the spread betting account is distinctive since the account is designated in GBP.

The spread betting includes taking a wagered on the value development of currency sets. An organization offering currency spread betting normally cites two costs, the offer and the ask cost – this is known as the spread. Traders wager whether the cost of the currency match will be lower than the offer cost or higher than the ask cost. The smaller the spread, the more alluring the currency match. Like spread betting, traders don’t have to really possess any currency. Many managed forex trading accounts are working on hedge funds through the usage of spread betting to earn millions of dollars.

A financier firm quotes an approach cost for the EUR/USD match at 1.0015 and an offer cost at 1.0010. On the off chance that you as a dealer trust that the Euro will fortify contrasted with the USD, you could “wager” € 1 for each point (Pip) the Euro increments over 1.0015. In the event that the EUR/USD after a specific timeframe came to $1.0025, you would get € 1. On the off chance that the cost of the Euro was rather $1.0005, you would wind up losing € 1. Spread betting on shares illustration Say Apple is exchanging with an offer cost of 135.05 and a purchase cost of 135.20. You envision that Apple shares will ascend in the following couple of days because of another item discharge tomorrow. You choose to go long on (purchase) Apple shares for £10 per purpose of development at 135.20. Following three days, Apple shares have surely moved to support you and expanded to 135.50/135.65. You choose a decent time to close your exchange. This implies you’ll be turning out with a benefit of (13550 – 13520) x 10 = £300, barring all every day subsidizing charges. Then again, in the event that you initially chosen to offer Apple for £10 per point at 135.05 and afterward shut down at 135.65, you would have wound up with lost (13565 – 13505) x £10 = £600. By and by, barring any day by day subsidizing charges.


Posted in Uncategorized | Comments Off

What Is A Service Desk?

A Service Desk is an IT resource for organizations working with ITSM (IT Service Management) as defined in ITIL (IT Infrastructure Library). This software is intended to be the Single Point of Contact (SPOC) towards the customers of the IT department, usually the users in the company.

A Service Desk can easily be mistaken for being the same thing as a help desk. However, the difference is quite big when looking deeper on what this software can deliver.

This software works to support the different ITSM processes used in the company. That is right, Service Desk is not a process itself, it is called a function.
We are not going to discuss what the different processes do but here is an example of a few processes:

* Incident Management
* Problem Management
* Change Management
* Release Management
* Availability Management
* Capacity Management
* Security Management

The idea is for the company to feel that there is one instance to call to get help and propose change requests. All incidents and user queries are owned by the Service Desk and it is up to the Service Desk to make sure the user’s incidents are solved, regardless of if they have sent the request somewhere else or are working on it themselves.

Besides being the single point of contact it is the responsibility of the Service Desk to make sure that services that are provided are working. If an IT service is not working, the Service Desk should try to get it up and running as quickly as possible. It is also for the Service Desk to give system support to the users.

The work in the Service Desk is clearly defined and also has the responsibility of making sure that all incidents and user queries are managed as promised. Promises around the service are defined in an SLA (Service Level Agreement).

To manage all calls everything is stored in some kind of Service Desk Software. The Service Desk Software includes a lot of functionality to help the Service Desk perform its work, such as:

* Web / Email creation and monitoring of requests
* Knowledge base
* Internal chat with storing of conversations as part of the requests
* Interface customization to customize to support the processes and the organization the best
* Automated work flow engine to make as much as possible automated
* Flexible reports as needed to monitor progress of requests
* Dashboard for the personnel to give possibilities to easy know what needs to be done
* Automated monitoring of requests according to what is promised in the SLA
* and much more…

Since this software is the single point of contact to the users, it is often set that all communication should be going through the Service Desk. This includes questions that need to be asked from any of the service providers to the users. The communication then goes back and forth via the software.

In theory this is the way it should work, but in practice processes are often set up to make it possible for the person working with the request to communicate with the user, regardless of where in the ITSM organization the person is working.

Implementing this kind of software and therefore also ITSM in an organization can often be quite hard work and in the beginning a lot of things go wrong. But after some time and adjustments the work will be much more efficient and with higher quality than before.

A lot is thanks to the structured work defined by the processes, but also thanks to the Software that is implemented and tuned to fit the organization the best.

It is definitely recommended to start with one or at least just a few of the processes, such as Incident Management, Problem Management and Change Management. One will then be able to extend the ITSM commitment to include one more process at the time.

People working in the Service Desk are able to work in the different processes specified above. This will help in setting up your ITSM organization and to have ITSM work in your favor instead of the other way around.

Posted in Uncategorized | Comments Off

Strategy: Simplified

We all read about it regularly & gain insight into the depths of one of the most important aspects of the business world, strategy. But what we generally come across is probably a jargonized version. All the academicians, consultants, researchers & writers talk & describe strategy in a very complex way, as if it were something that was complex & hard to imagine monster of some kind. But the fact is, Jargon sells. So everyone writes about it in a way to make it look impressive & to increase its cost price. In the following article, I will describe corporate & business strategies in a way which everyone will understand easily. I will demystify the jargonized phrases & explain each sub topic in a simple way, as I believe in the ‘keep it short & simple’ ideology of explaining things & concepts.


Strategy!! According to the online Oxford dictionary (oxforddictionaries.com), strategy means:
• A plan of action designed to achieve a long-term or overall aim
• The art of planning and directing overall military operations and movements in a war or battle
The Origin of the word dates back to the early 19th century: from French stratégie, from Greek stratagia ‘generalship’, from stratagos.

The underlined definition (first one) above is the simplest meaning of the word. So, if we dwell a bit deep into the meaning of the sentence itself & try to read between the lines, it suggests that Strategy is:
1. A plan of action
2. To achieve a long term aim

In other words, the 1st sentence suggests that Strategy is a plan of the actions.
Now think a while on that & some questions arise regarding the 1st part of the sentence:
• Plan???
• What plan?
• How is it decided upon?
• What is the plan set for?
• Who sets the plan?
• Why is the plan set?
• What are the elements of the plan?
• When is this plan set?
• What are the actions?
• How are they decided upon?
• Who decides these actions?
• When are they decided?
• Why do we need to take actions?
• How are they related to the long term goals?
Etc. etc. etc. One can go on & on.

The second part of the sentence talks about the long term aim to be achieved. Here too, like above, some questions arise:
• Long term aims for what?
• What are these aims?
• How long is – long term?
• Can they be short term also?
• How short?
• What are these aims for?
• How are they decided upon?
• Who sets them?
• Why are they set?
• How is they decided upon?
• What are the elements of the aims?
• When are these set?

The list of questions above is basically asks the following questions, regarding the aims & the duration (also called strategic horizon period):

• What?
• Why?
• How?
• When?
• Who?
• For Whom?

So, whenever you hear the word strategy, it would mean that a plan is being talked about. Someone saying ‘I look after the communications plan for the XYZ Corporation’ would mean that he/ she takes care of formulating & implementing the communication plan to advertise or communicate about XYZ Corporation or its products.Let us see an example. Suppose I tell you to go to the supermarket & buy some vegetables. What is the process you will follow considering you are in your own home? Let’s see some questions to be considered:
• Which vegetables?
• How much?
• What’s the budget?
• Who will give the money?
• By when are the things required?

Etc. etc. etc. Now if you get answers to all the questions & finalize the plan to go & buy the vegetables, it would be called your ‘vegetable buying strategy’ for that day.

Now if I change the setting a bit & say that you are in my house in a different country. Would your approach change? Would the list of questions increase? I am sure it will.
• Which vegetables?
• How much?
• What’s the budget?
• Who will give the money?
• By when are the things required?

New extra questions:

• Where to buy from?
• Name of the shop/ store?
• What is the local language here?
• Do people speak English?
o Can you write it down on a piece of paper in the local language, in case someone doesn’t understand English?
o Can you jot down the list of items in the local language for the store?
• What is the currency & denominations?
• How to get there?
o Personal transport

Is there enough fuel for the round trip

Where will I park the car there?
o Public transport

How much money would be required for the round trip?
• How much time will it take to go there?
• Do you have any other information which might be useful to me?

Etc. etc. etc. Now if you get answers to all the questions & finalize the plan to go & buy the vegetables, it would be called your ‘vegetable buying strategy in new market’ for that day.


The basic thought process to develop a strategy is to think about & answer the following:

• Where are we now?
• Why are we here? What are the good things & the bad things that have happened in the past due to which we are here?
• Where do we want to go?
• What do we want to achieve?
• Why?
• How?

There are many questions to be asked, a lot of data to be gathered, loads of information to be culled out & a good deal of analysis done before one can answer those questions.


So, now we know the meaning & elements of strategy. But what are the types?

Even though the word strategy can be added as a suffix to any term (like technology strategy, innovation strategy, resume strategy, people strategy, road crossing strategy etc.) but, from a business perspective, it’s mainly classified into:


It talks about the plans of the corporate unit as a whole. A corporate unit consists of many businesses & is in-charge of running them profitably. Corporate groups generally have varied business interests& that’s why they set up many businesses in different sectors to leverage the business opportunities that come up from time to time.

Sam Walton saw a big opportunity in retail & thus set up Wal-Mart. Nokia saw a huge opportunity in mobile market & set up its handset making factory, totally changing focus from its fishing rod making business it was previously in. GE & Virgin groups run hundreds of businesses under their corporate structure.


This means to plan for successfully running a business. It may be a part of a corporate structure or may be a standalone business.

Body Shop is in the business of personal cosmetics whereas Nissan is in the automobile sector. Whereas Nissan is a part of a corporate group, Body Shop is not.


This takes care of the individual departments/ functions in a business, like marketing, finance, human resources etc. Every function has various elements which form an integral part of that function. For example, sales, after sales, product, advertising, pricing etc. are the elements of the marketing function. Each of these elements is run by managers & their juniors. These people are often called operational resource because they are the ones who do the job or perform the operations. There is strategy for each of these elements also, but it is called by a different name, objectives. Each of these elements takes care of their objectives. It is worth mentioning that the strategy, goals & objectives, all are measurable & can be quantified against set targets.

Vision & Mission of the group guides the strategic process. The corporate strategy is aligned to the purpose of the organization.

The various interlink-ages, which joins each of the types described, & the strategy framing process, above are:

1. Corporate strategy
2. Business strategy
3. Functional strategy
4. Elemental strategy
5. Individual goals

The process flow depends on the organizational culture. Some follow it 1 to 5 (the drip down approach) others set it from 5 to 1 (the bubble up approach). In the former, the corporate strategy is set & then the chain follows down to individual objectives. For example the Chairman says that next year we shall grow by 5% in our turnover (now he doesn’t say it just like that. He has his own way of gathering information about the economy, the sector etc. & based on these facts he draws the conclusion). This statement sets the process & targets for businesses which may be a part of the group & it goes down to the level of setting the individual targets.

In the latter, the individual targets are set & they lead to the setting of the corporate strategy. For example, the individuals in the sales department are asked to set a target for themselves, in consultation with their managers & thus collating of all targets gives a basic guideline for setting the corporate strategy.

No matter what the approach is, every objective & target is linked to the overall objective of the firm, the corporate strategy which in turn is aligned to the Vision of the group.

DURATION:The duration is also called the strategic horizon period.

There are short term & long term goals for all the five types of interlinking elements, mentioned above. The duration depends on the organization. Generally short term refers to less than one year & long term refers to a period of five years.


There are some analysis that have to be done before we can actually draw a strategy. These are classified as:

• Internal analysis

o Strengths

What are our strengths?

o Weaknesses

What are our weak points?

o Core competence

What are we best at?

o Product portfolio analysis

What is our product range & their performance from a financial& growth aspect?

o Market portfolio analysis

Which markets are we serving & what is their performance from a financial & growth aspect?

• External analysis

o Opportunities

What are the current opportunities we can take leverage of?

o Threats

What are the threats that need to be seen & considered? & in which areas?

o Competition

How is competition doing vis-à-vis us? Who are the players?

o Economy

How is the economy performing? What is the forecast?

o Legal
Are there any policy changes recently? What is the forecast?

o Socio cultural

Is the demography of our target customers stable or is it changing? How?

o Political

What is the political scenario & forecast? What are the issues & stability factor?

o Technological

Is the technology we are using current? What are the new technologies in the market?


Data gathering
Data analysis
Data refinement
Review progress
Further refinement


Corporate Strategy setting is basically looking a group from a bird’s eye view. & similarly business strategy would mean to look at a business from a bird’s eye view. If you start imagining this, then you would only see a business unit & its functions & elements. How are they performing, & how they can be improved? This is the basic meaning of strategy.

People who frame strategy are information seekers & data analyzers. Above all they are great thinkers. They have the ability (or develop it) to think the very minute details of all the elements that form strategy at any level.

Information is the key to all decisions. Only time & results decides the rightfulness & the effectiveness of a decision because there are infinite variables & we cannot take care of every one while forming a strategy. All we can do is to put a sincere effort, be prepared for any situation & be responsible & accountable for our decisions.

Information is the key to success & more important than that are smart thinkers.

Posted in Uncategorized | Comments Off

Bankers’ Banks- The Role of Central Banks in Banking Crises

Central banks are relatively new inventions. An American President (Andrew Jackson) even cancelled its country’s central bank in the nineteenth century because he did not think that it was very important. But things have changed since. Central banks today are the most important feature of the financial systems of most countries of the world.

Central banks are a bizarre hybrids. Some of their functions are identical to the functions of regular, commercial banks. Other functions are unique to the central bank. On certain functions it has an absolute legal monopoly.

Central banks take deposits from other banks and, in certain cases, from foreign governments which deposit their foreign exchange and gold reserves for safekeeping (for instance, with the Federal Reserve Bank of the USA). The Central Bank invests the foreign exchange reserves of the country while trying to maintain an investment portfolio similar to the trade composition of its client – the state. The Central bank also holds onto the gold reserves of the country. Most central banks have lately tried to get rid of their gold, due to its ever declining prices. Since the gold is registered in their books in historical values, central banks are showing a handsome profit on this line of activity. Central banks (especially the American one) also participate in important, international negotiations. If they do not do so directly – they exert influence behind the scenes. The German Bundesbank virtually dictated Germany’s position in the negotiations leading to the Maastricht treaty. It forced the hands of its co-signatories to agree to strict terms of accession into the Euro single currency project. The Bunbdesbank demanded that a country’s economy be totally stable (low debt ratios, low inflation) before it is accepted as part of the Euro. It is an irony of history that Germany itself is not eligible under these criteria and cannot be accepted as a member in the club whose rules it has assisted to formulate.

But all these constitute a secondary and marginal portion of a central banks activities.

The main function of a modern central bank is the monitoring and regulation of interest rates in the economy. The central bank does this by changing the interest rates that it charges on money that it lends to the banking system through its “discount windows”. Interest rates is supposed to influence the level of economic activity in the economy. This supposed link has not unequivocally proven by economic research. Also, there usually is a delay between the alteration of interest rates and the foreseen impact on the economy. This makes assessment of the interest rate policy difficult. Still, central banks use interest rates to fine tune the economy. Higher interest rates – lower economic activity and lower inflation. The reverse is also supposed to be true. Even shifts of a quarter of a percentage point are sufficient to send the stock exchanges tumbling together with the bond markets. In 1994 a long term trend of increase in interest rate commenced in the USA, doubling interest rates from 3 to 6 percent. Investors in the bond markets lost 1 trillion (=1000 billion!) USD in 1 year. Even today, currency traders all around the world dread the decisions of the Bundesbank and sit with their eyes glued to the trading screen on days in which announcements are expected.

Interest rates is only the latest fad. Prior to this – and under the influence of the Chicago school of economics – central banks used to monitor and manipulate money supply aggregates. Simply put, they would sell bonds to the public (and, thus absorb liquid means, money) – or buy from the public (and, thus, inject liquidity). Otherwise, they would restrict the amount of printed money and limit the government’s ability to borrow. Even prior to that fashion there was a widespread belief in the effectiveness of manipulating exchange rates. This was especially true where exchange controls were still being implemented and the currency was not fully convertible. Britain removed its exchange controls only as late as 1979. The USD was pegged to a (gold) standard (and, thus not really freely tradable) as late as 1971. Free flows of currencies are a relatively new thing and their long absence reflects this wide held superstition of central banks. Nowadays, exchange rates are considered to be a “soft” monetary instrument and are rarely used by central banks. The latter continue, though, to intervene in the trading of currencies in the international and domestic markets usually to no avail and while losing their credibility in the process. Ever since the ignominious failure in implementing the infamous Louvre accord in 1985 currency intervention is considered to be a somewhat rusty relic of old ways of thinking.

Central banks are heavily enmeshed in the very fabric of the commercial banking system. They perform certain indispensable services for the latter. In most countries, interbank payments pass through the central bank or through a clearing organ which is somehow linked or reports to the central bank. All major foreign exchange transactions pass through – and, in many countries, still must be approved by – the central bank. Central banks regulate banks, licence their owners, supervise their operations, keenly observes their liquidity. The central bank is the lender of last resort in cases of insolvency or illiquidity.

The frequent claims of central banks all over the world that they were surprised by a banking crisis looks, therefore, dubious at best. No central bank can say that it had no early warning signs, or no access to all the data – and keep a straight face while saying so. Impending banking crises give out signs long before they erupt. These signs ought to be detected by a reasonably managed central bank. Only major neglect could explain a surprise on behalf of a central bank.

One sure sign is the number of times that a bank chooses to borrow using the discount windows. Another is if it offers interest rates which are way above the rates offered by other financing institutions. There are may more signs and central banks should be adept at reading them.

This heavy involvement is not limited to the collection and analysis of data. A central bank – by the very definition of its functions – sets the tone to all other banks in the economy. By altering its policies (for instance: by changing its reserve requirements) it can push banks to insolvency or create bubble economies which are bound to burst. If it were not for the easy and cheap money provided by the Bank of Japan in the eighties – the stock and real estate markets would not have inflated to the extent that they have. Subsequently, it was the same bank (under a different Governor) that tightened the reins of credit – and pierced both bubble markets.

The same mistake was repeated in 1992-3 in Israel – and with the same consequences.

This precisely is why central banks, in my view, should not supervise the banking system.

When asked to supervise the banking system – central banks are really asked to draw criticism on their past performance, their policies and their vigilance in the past. Let me explain this statement:

In most countries in the world, bank supervision is a heavy-weight department within the central bank. It samples banks, on a periodic basis. Then, it analyses their books thoroughly and imposes rules of conduct and sanctions where necessary. But the role of central banks in determining the health, behaviour and operational modes of commercial banks is so paramount that it is highly undesirable for a central bank to supervise the banks. As I have said, supervision by a central bank means that it has to criticize itself, its own policies and the way that they were enforced and also the results of past supervision. Central banks are really asked to cast themselves in the unlikely role of impartial saints.

A new trend is to put the supervision of banks under a different “sponsor” and to encourage a checks and balances system, wherein the central bank, its policies and operations are indirectly criticized by the bank supervision. This is the way it is in Switzerland and – with the exception of the Jewish money which was deposited in Switzerland never to be returned to its owners – the Swiss banking system is extremely well regulated and well supervised.

We differentiate between two types of central bank: the autonomous and the semi-autonomous.

The autonomous bank is politically and financially independent. Its Governor is appointed for a period which is longer than the periods of the incumbent elected politicians, so that he will not be subject to political pressures. Its budget is not provided by the legislature or by the executive arm. It is self sustaining: it runs itself as a corporation would. Its profits are used in leaner years in which it loses money (though for a central bank to lose money is a difficult task to achieve).

In Macedonia, for instance, annual surpluses generated by the central bank are transferred to the national budget and cannot be utilized by the bank for its own operations or for the betterment of its staff through education.

Prime examples of autonomous central banks are Germany’s Bundesbank and the American Federal Reserve Bank.

The second type of central bank is the semi autonomous one. This is a central bank that depends on the political echelons and, especially, on the Ministry of Finance. This dependence could be through its budget which is allocated to it by the Ministry or by a Parliament (ruled by one big party or by the coalition parties). The upper levels of the bank – the Governor and the Vice Governor – could be deposed of through a political decision (albeit by Parliament, which makes it somewhat more difficult). This is the case of the National Bank of Macedonia which has to report to Parliament. Such dependent banks fulfil the function of an economic advisor to the government. The Governor of the Bank of England advises the Minister of Finance (in their famous weekly meetings, the minutes of which are published) about the desirable level of interest rates. It cannot, however, determine these levels and, thus is devoid of arguably the most important policy tool. The situation is somewhat better with the Bank of Israel which can play around with interest rates and foreign exchange rates – but not entirely freely.

The National Bank of Macedonia (NBM) is highly autonomous under the law regulating its structure and its activities. Its Governor is selected for a period of seven years and can be removed from office only in the case that he is charged with criminal deeds. Still, it is very much subject to political pressures. High ranking political figures freely admit to exerting pressures on the central bank (at the same breath saying that it is completely independent).

The NBM is young and most of its staff – however bright – are inexperienced. With the kind of wages that it pays it cannot attract the best available talents. The budgetary surpluses that it generates could have been used for this purpose and to higher world renowned consultants (from Switzerland, for instance) to help the bank overcome the experience gap. But the money is transferred to the budget, as we said. So, the bank had to do with charity received from USAID, the KNOW-HOW FUND and so on. Some of the help thus provided was good and relevant – other advice was, in my view, wrong for the local circumstances. Take supervision: it was modelled after the Americans and British. Those are the worst supervisors in the West (if we do not consider the Japanese).

And with all this, the bank had to cope with extraordinarily difficult circumstances since its very inception. The 1993 banking crisis, the frozen currency accounts, the collapse of the Stedilnicas (crowned by the TAT affair). Older, more experienced central banks would have folded under the pressure. Taking everything under consideration, the NBM has performed remarkably well.

The proof is in the stability of the local currency, the Denar. This is the main function of a central bank. After the TAT affair, there was a moment or two of panic – and then the street voted confidence in the management of the central bank, the Denar-DM rate went down to where it was prior to the crisis.

Now, the central bank is facing its most daunting task: facing the truth without fear and without prejudice. Bank supervision needs to be overhauled and lessons need to be learnt. The political independence of the bank needs to be increased greatly. The bank must decide what to do with TAT and with the other failing Stedilnicas?

They could be sold to the banks as portfolios of assets and liabilities. The Bank of England sold Barings Bank in 1995 to the ING Dutch Bank.

The central bank could – and has to – force the owners of the failing Stedilnicas to increase their equity capital (by using their personal property, where necessary). This was successfully done (again, by the Bank of England) in the 1991 case of the BCCI scandal.

The State of Macedonia could decide to take over the obligations of the failed system and somehow pay back the depositors. Israel (1983), the USA (1985/7) and a dozen other countries have done so recently.

The central bank could increase the reserve requirements and the deposit insurance premiums.

But these are all artificial, ad hoc, solutions. Something more radical needs to be done:

A total restructuring of the banking system. The Stedilnicas have to be abolished. The capital required to open a bank or a branch of a bank has to be lowered to 4 million DM (to conform with world standards and with the size of the economy of Macedonia). Banks should be allowed to diversify their activities (as long as they are of a financial nature), to form joint venture with other providers of financial services (such as insurance companies) and to open a thick network of branches.

And bank supervision must be separated from the central bank and set to criticize the central bank and its policies, decisions and operations on a regular basis.

There are no reasons why Macedonia should not become a financial centre of the Balkans – and there are many reasons why it should. But, ultimately, it all depends on the Macedonians themselves.

Posted in Uncategorized | Comments Off