For any of the football fans who read my commentary, you may have been wondering if I took a convenient sick day yesterday after Sunday’s defeat to Manchester United. Thankfully, my client meeting in Kerry spared me the smugness (deserved) of the Manchester United fans that work alongside me at Invesco. In early February, I likened Liverpool to a momentum hedge fund riding the wave higher. Well, on Sunday, we got a nasty margin call! And on the other end of the line was an arrogant Dutchman. Every run comes to an end, but losing to Manchester United is never easy to take.
For those who wonder what football, or any sport for that matter, has to do with economics and financial markets, the answer is simple. People. Behind every economic statistic is a collection of decisions, made by people. The market is not an invisible hand, it is a mechanism defined by the behaviour of people, often rational but sometimes completely irrational. Sports teams are defined by people, who through passion and heart can bring success and inspire a zealous following.
For more than a decade, Steven Gerrard has been the person who has defined Liverpool FC, an undisputable legend of the game. The sending off was stupid, no question, but again it shows that emotion can short circuit the decision making of the key people in any profession. On leaving Liverpool, Bill Shankly said “It was the most difficult thing in the world, when I went to tell the chairman. It was like walking to the electric chair. That’s the way it felt.” For Stevie G, walking away from the club he loves – made worse by the events of the last year – is the end of life as he has known it for 26 years! It’s about more than just football.