Find out exactly how the big Investment Institutions and Banks exercise their controlling influence over British industry and commerce. A great book essential for anyone seeking a career in Investment Banking

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Product Description

The landscape of our financial system is dominated by institutional investment. The funds move markets when they act, and corporate empires can rise, fall or change hands on the tide of institutional opinion and the flow of equity. Today, in many ways, these institutions are the City, such is their influence over the whole financial process.  They are at the heart of the expectation machine; the Capital of capital.

These all-powerful financial players cast a long shadow over the worlds of investment, corporate and venture finance, and yet City outsiders - from private investors to company directors - many of whose expectations and fortunes are tied to the flow of equity, know little about them.  They may glimpse parts of the process through the, frequently distorted, lens of the press; they may find their activities and fortunes affected by the movements of institutional players, but rarely do they understand the subtle and complex relationships that drive behaviour of the City.

It is remarkable, in view of the power wielded by the big investment institutions, how little has been written about them, especially from an analytical rather than anecdotal standpoint.  The financial world, and the business world it drives, need a better understanding of the City and the behaviour of equity - the "visible" part of what the City does.

In The City; Inside the Great Expectations Machine , Investment Analyst Tony Golding takes you inside the equity market and explains its structure, dynamics and behaviour. An easy-to-read, comprehensive analysis of the big investment institutions who dominate the stock market, with key insights into their impact on the City, industry and the private investor.  This book will explain how the institutions achieved their ascendancy, acquire their funds, invest those funds and significantly influence other City activities and the corporate world in the process.  The book will trace the flow of funds through the City and offer valuable insights into how fund managers behave, what drives their performance, the pressures they are under and the effects of their actions on the investment and corporate worlds.     The behaviour of the investment institutions - pension funds, insurance companies, unit trusts, investment trusts - touches, in one way or another, the great majority of those living in the UK.  To an extent that few outside the City appreciate, they dominate the London stock market, both in terms of ownership and activity. This text examines the way these institutions work, how fund managers invest and the implications of their investment behaviour. Institutional investors own 75 per cent of the shares quoted in the UK. In no other major economy - including the USA, where the institutional control is a much more modest 55 per cent - do the investment instituions exert such a grip on the corporate sector.  It is not uncommon for large and medium-sized British companies to have 80 or 90 per cent institutional ownership. Share-prices are determined by the fund managers working in a small number of large institutions.  The nostalgic idea that price setting in the stock market is the result of a multitude of individual decisions is, this text argues, a dangerous illusion. The book provides information about the investment institutions around which the stock market revolves, arguing that their perceptions and their actions determine the level of share-prices and much else besides, such as the success or failure of a takeover bid.  It asks: what motivates fund managers and how do they make their decisions?; How do companies communicate with their institutional shareholders, especially in regard to the task of managing expectations?  What companies do fund managers like or dislike, and why?  And to what extent do they rely on the investment analysts employed by the investment banks for information and advice?

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Product Details

• Amazon Sales Rank: #182249 in Books
• Published on: 2002-09-09
• Original language: English
• Binding: Paperback
• 270 pages

Review
"In his new book, Tony Golding provides insights into the fund management industry which unline Mathew Goldsmith's view of large companies running small-cap funds".Fundstrategy, January 2001 "In this eloquent and intelligent book, Tony Golding shows why institutions behave the way they do, and how a knowledge of their priorities can help you."Shares, January 2001

"Former investment banker Tony Golding perfectly captures the psychology (of the City) in his recent book where he explains how investment institutions and analysts over-identify companies with their chief executives and then make exorbitant demands on them"
John Plender, columnist, Financial Times

"Tony Golding has done us all a service by lifting the lid on one of the best kept secrets around, which is how the City really works.  No investor can fail to profit from reading this insider's account of what drives brokers, fund managers and investment bankers to behave the way they do."
Jonathan Davis, Investment columnist, The Independent

"Fascinating 'anatomy' of the City, explaining to private investors how fund managers reach decisions, and why an understanding of their mindset is crucial to successful private investment."
Investors Chronicle

"Golding explains the ground rules with the clarity of an informed and observant insider, and few serious investors will not learn something from this book."
Financial News

"I wish I'd read this book before we went public rather than after. Understanding the dynamics of the City and the interplay between the various parties is very important and this book explains these relationships very well".
Dr.Tony Milbourn, Managing Director, TTP Communications plc

"A highly entertaining and particularly insightful read about what investment bankers, fund managers and investment analysts really do and what motivates them. To be highly recommended for all students of the City and an essential text for any MBA course in finance."
Richard Taffler, Professor of Accounting and Finance, Cranfield School of Management

Financial News, January 22, 2001
Golding explains the ground rules with the clarity of an informed and observant insider, and few serious investors will not learn something from his book.

Pensions Management, January, 2001
This book should be required reading for every pension fund trustee as well as chancellor Gordon Brown.

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Customer Reviews

'The City' by Tony Golding- a must buy!
For readers with all degrees of knowledge, Tony Golding offers an invaluable overview of the workings of The City. With chapters ranging from how the city actually came to be the financial centre of England, interpreting confused concepts such as ‘investment banking’ and ‘liquidity’, and explaining the mind-set of fund managers, Golding gives the reader a non-biased, dispassionate analysis.

Golding is not afraid to tell the reader how it really is. He criticises when it is appropriate and praises when necessary. He concentrates on equities, and details clearly how the change of ownership from private to institutional investors has come about in recent years. He shows how perception holds far more weight than reality with regard to stock valuation and states clearly and precisely what most British commentators try hard not to admit: the victory of the ‘US model.’

It is absolutely essential that this book retain pride of place on the bookshelf of investors, those employed in the City or for anyone with the slightest bit of interest in the inner and outer workings of ‘The Great Expectation machine.’

Tony Golding tells "tells it how it is"
To the outsider the City is bewilderingly complex. Not a place, but a set of interrelated activities: investment banking, corporate stockbroking, fund management, venture capital and all the paraphernalia that links funding to business.

In his book Tony Golding writes a history of the City, describes how it works, and explains the psychology of its participants. Such a colossal accumulation of wealth in the hands of so few can only have profound implications for the ordinary investor, and as Golding shows, it does.

Far from being a wallflower the City these days is the disk jockey. Companies dance to its tune and the ultimate sources of funding (you and I) are not even invited to the party. Yet the analysts, bankers and fund managers occupying centre stage are victims of circumstance too. Their behaviour is apparently perverse, but actually, says Golding, it is entirely logical.

To keep alive the conceit of steady progress, so essential to executive bonuses and fund manager remuneration, analysts drip-feed information to investors and the media using techniques to maximise the good news and bury the bad. It's a process akin to political spin sanitised by the label 'investor relations'.

These are a few of the more lurid insights Golding supplies into the "great expectation machine" and the characters that run it. With under performance, dodgy analysis and greed the norm, and the implications that has for small investors, savers and employees, the reality of the City is clearly flawed.

Changes will be made, lawyers stalking investment banks and governments scrutinising the business of finance will make sure of it, but Golding's book, part manual and part analysis, shows it took us centuries to get here. Fiddling with the rulebook is unlikely to revolutionise the game. At least in "telling it like it is", Tony Golding gives the determined reader and private investor the opportunity to make more sense of the City, warts and all.

Take it.

An Excellent Overview for the Outsider
Inside the City provides an excellent overview of how international markets function and how they've evolved in recent years. Its clarity and insights make it brilliantly easy to see through the complexities of the subject, as well as understand the issues and failings of the investment industry. As a layman I came away realizing the financial world is no longer a mystery - and with enough understanding to talk business with professional city contacts.