I have to shake my head in disappointment at the headlines this past week in the world of finance and money. It makes me wonder why I even periodically come to the defense of the industry when in weeks like this, it seems like a fruitless exercise. Here’s a tasting of this past week:
1. LIBOR manipulation settlements. LIBOR is the benchmark interest rate that impacts hundreds of trillions of dollars worth of financial contracts. Everything from mortgages, student loans, car loans, derivative contracts, and many others are pegged to LIBOR. LIBOR is calculated daily based on the submissions of some of the largest banks in the world. And, in 2005-2009, it was apparently manipulated by some those contributing banks for their own personal gain. This week, one of the chief offenders, Barclays, reached another settlement with a regulators over their behavior in this period. How is it possible that one of the most important metrics in the global finance industry is manipulated over many years? I guess it’s entirely possible.
2. The stock market is “rigged” – according to author Michael Lewis. His claim is that high frequency traders front-run stock trades all day and every day so that both institutional and retail investors alike pay what amounts to artificially expensive and manipulated prices on routine stock trades. This is apparently legal, for now. But, its potentially wide-ranging impact on the US stock market is coming to light.
3. Alleged IRS corruption hearings proceed. Claims of the IRS abusing power are came back into the forefront this week. This has unfortunately become a purely partisan issue. But, further information about the IRS suggests there’s potentially a bigger issue at hand than even what’s presently going through the House.
4. SAC Capital pays largest insider trading settlement in history. $1.8 billion is what it takes to settle one of the longest running, widest ranging insider trading scandals in history.
So, in one week, the headlines are about THE benchmark interest rate being manipulated for years, the entire stock market being rigged, the largest taxing authority in the US potentially corrupt, and the largest ever insider trading investigation being settled. Clearly, this has not been a proud week for the world of finance. Let’s hope better things are in store next week.
I like to blog about different, random, more personal things on the weekends. Hence, I’m starting a series on books that I think directly or indirectly answer an interesting question with an interesting point of view. The first installment last weekend was Why Are 80% of Harvard Students First-Borns?. Today is the second installment and is about one of my favorite relationship books – The 5 Love Languages by Gary Chapman.
If we look around – it’s pretty undeniable that there are broken relationships within marriages, families, and friends. What’s underlying some of the challenged relationships between spouses, parent/children, etc.? Clearly, there’s not one simple answer. Yet, Gary Chapman lays out a relatively simple but profound theory based on a very straight forward framework that may have broad relevance. First the framework:
He believes that there are 5 primary love languages and everybody has a primary (usually one, maybe two) love language which makes them feel loved. Importantly, their primary love language is not necessarily the way they communicate love to others – but it’s how they feel loved by others. The 5 languages are:
- Physical Touch – hugs, kisses, physical play, affection, etc.
- Words of Affirmation – words of praise, encouragement, adoration, admiration, etc.
- Quality Time – focused, attentive time in a joint activity, conversation, etc.
- Gifts – self explanatory: meaningful, thoughtful gifts
- Acts of Service – helping out with projects, responsibilities, homework, tasks, etc.
So, that’s the framework. The theory on why some relationships are strained is pretty straight forward:
- Everyone has a primary love language – which is how they receive love.
- People tend to communicate love to others with their own primary love language.
- But, if the other person has a different primary love language, they will not feel loved.
For example – your primary love language may be words of affirmation. But, if your child’s love language is physical touch – no amount of verbal praise will replace your child’s need for hugs, physical play, and so forth. Or your love language may be physical touch, but your spouse’s may be acts of service. So, no amount of affection will replace the love communicated through service acts like cleaning up the house, cooking a meal, or taking out the garbage. That’s why two people in a relationship can be trying hard but not communicating love to each other because they don’t recognize the distinction in each person’s primary love languages.
Though it’s a relatively simple framework – I recommend getting the book if it’s at all interesting to you. The book gives more insight into how to determine someone’s primary love language, practical ideas around each love language, and more insight and detail on what each love language means. OK, I never thought I’d write a blog post with the word “love” in it 25 times. I think my next post will have to be about ultimate fighting or something.
That’s my estimate anyways. I remember it like it was yesterday. It was my freshman year at Harvard, and I was going to the first lecture of “Justice” – one of the most popular classes on campus. The lectures took place in Sanders Theater packed by over a thousand students since it’s only offered once every three years. The first question the professor asked – please stand up if you’re the first born child in your family (inclusive of only children). I literally felt like everyone in the entire theater stood up – except me since I’m a youngest child. Why is it that such a high majority of Harvard students are first borns or only children?
Because birth order matters according to Dr. Kevin Leman, author of The Birth Order Book – Why You Are the Way You Are. I’ve been reading it – here’s his framework on how the different orders generally are (noting that not every characteristic applies to every child):
First Child: perfectionist, reliable, conscientious, a list maker, well organized, hard driving, a natural leader, critical, serious, scholarly, logical, doesn’t like surprises, a techie.
Middle Child: mediator, compromising, diplomatic, avoids conflict, independent, loyal to peers, has many friends, a maverick, secretive, used to not having attention.
Youngest Child: manipulative, charming, blames others, attention seeker, tenacious, people person, natural salesperson, precocious, engaging, affectionate, loves surprises.
Only Child: little adult by age seven, very thorough, deliberate, high achiever, self-motivated, fearful, cautious, voracious reader, black-and-white thinker, talks in extremes, can’t bear to fail, has very high expectations for self, more comfortable with people who are older or younger.
[Related Post: The Letter Given to the Valedictorian of Harvard]