Wednesday, December 7, 2011

Metallica, forex dealers

Neil Shah in the Wall Street Journal reports:
Duff McKagan, the former bassist of Guns N’ Roses, once unwittingly spent $40,000 on expensive suits in Italy because he didn’t realize how much his purchases—then in Italian lira—were worth in dollars. The lanky musician now sings a more sober tune: After taking business courses at Seattle University, he started writing about finance for Playboy ("Duffonomics") and—most recently—launched a wealth-management firm for rockers: Meridian Rock Capital Management LP. Millionaire musicians, the 47-year-old told fans at New York City's Strand bookstore in October, are an “underserviced” community. 
And then, as always, there is Metallica:
After the 2008 global financial crisis, rock bands and their managers are paying closer attention to obscure concerns like currency rates and economic trends when inking contracts with foreign concert promoters. Eight months before Metallica takes the stage in Germany, [manager Cliff] Burnstein decides whether the band should be paid in dollars, euros or a combination of the two. If exchange rates swing in a way that hurts Metallica’s earnings, he buys derivative financial instruments to lock in a preferred rate. Sometimes ticket prices are hiked to compensate for possible currency-related losses, though Mr. Burnstein shuns this strategy.
“Nobody is looking to make a foreign-exchange trade to make money, but you don’t want to be a loser,” the scraggly bearded manager said.
Speaking of scraggly bearded comedians, here is Bill Bailey with his version of Metallica’s “Enter Sandman”:


Monitor: Penny Wise

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