If I had a 7 BILLION dollars, I’d buy…
moneyrelations :: Jan.28.2008
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Even for those who do not normally follow financial news, the name Jérôme Kerviel is getting pretty recognizable in the mainstream media… Pretty understandable if you’re on the hook for losing €4.9 billion through fraudulent trading at the second largest French bank, Société Générale.
I know numbers get thrown around a lot and they become pretty meaningless but let’s reflect on this a moment. Convert this to U.S. dollars and add in all the zeros, you have $7,140,000,000.
What exactly can you buy with this amount of money? Thank goodness for Google because someone actually calculated this. Take your pick:
- 110 F-35 Joint Strike Fighter jets
- 8 Queen Mary 2 luxury cruise liners
- 1 week’s worth of U.S. oil imports
- 2 Freedom Towers at Ground Zero
- 17 million Apple iPhones
- Nearly double Bolivia’s foreign debt
- But only 4.76 percent of President Bush’s economic stimulus plan
The most astounding thing from preliminary reports is that his motives are unclear. He didn’t stand to profit from his trades even though he only made a modest €100,000 ($145,700 U.S.) from salary and bonus combined.
Do I really believe this? That he acted alone and that it’s not some sort of cover-up for something else? Okay, whatever. I know there are ethical hackers but if you want to prove a security point, I don’t think you need to do it by jeopardizing billions of dollars.
And it’s not exactly the best timing either, when the world markets are volatile with the threat of a U.S. recession and banks are on edge with even more reputation risk after subprime losses.
So I guess if he didn’t do it for money, he did it for fame.
If convicted (as if not already through the media), his name will be synonymous with other financial screw-ups. The question is how much time he’ll do.
Nick Leeson - lost $1.4 billion U.S. for Barings Bank, sentenced 6.5 years
Yasuo Hamanaka - lost $2.6 billion U.S. for Sumitomo Corporation, sentenced 8 years.
Toshihide Iguchi - lost $1.1 billion U.S for Daiwa Bank, sentenced 4 years
John Rusnak - lost $691 million U.S. for Allied Irish Banks, sentenced 7.5 years
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I don’t even really need 7 billion, I would just need a couple hundred million for my landing strip, nice plane that will get me around, and my island. 7 Billion I don’t even know what I would do, you could probably solve lots of hunger problems around the world with 6.5 billion of it, simply by getting wells/water infrastructure and making sure people have potable water. The other 500 Million sustains my island, plane, and relaxing lifestyle.
In fact, for only 35 million you can buy a 800+ acre island near Fiji. That’s the life for me. One of my life goals I think is owning an island. There are surprisingly a lot of them, and one in my area that’s a few acres for only 75K. I never would have thought owning an island would be so attainable.
I believe he is covering up for someone. The other reasons don’t seem worthwhile to me.
@ Traciatim
Glad to see you’ve thoroughly thought this out
Wouldn’t expect less from a DIYer. And glad to see you can make do with only 500 mil 
@ Selene
It just seems an awful lot of money to go unchecked for the work of a single individual. They are saying he’s looking at 7 years in prison? That’s 1 billion per year. Is that appropriate or is that lenient compared to the run of the mill robbery? Hmmm.
you know, people think the financial pages are boring - but can you *imagine* the juicy movie that could be made about all this? We need more ‘wall streets’!
I assumed it was like the Nick Leeson story. He lost a lot of money on the markets making one or more bad calls, and then creatively committed fraud trying to cover it up, and save his job. And then it didn’t work.
@ Nancy
You know… I’ve never seen Wall Street
And the Nick Leeson story was done by Ewan McGregor in Rogue Trader. Never saw it either but maybe in my personal finance education kick, I should rent them 
@ plonkee
Yeah, maybe. And then when they found out and tried to unwind it, it got even worse. It just goes to show you… these smart people know all there is about sophisticated derivatives this and that. But at least I never lost a billion dollars.