By Rodney Morris
The issue is described in the appendix to JPMorgan's internal investigative task force's report. To summarize: JPMorgan's Chief Investment Office needed a new value-at-risk (VaR) model for the synthetic credit portfolio (the one that blew up) and assigned a quantitative whiz to create it. The new model operated through a series of Excel spreadsheets, which had to be completed manually, by a process of copying and pasting data from one spreadsheet to another. The internal Model Review Group identified this problem as well as a few others, but approved the model, while saying that it should be automated and another significant flaw should be fixed. After the London Whale trade blew up, the Model Review Group discovered that the model had not been automated and found several other errors.
The issue is described in the appendix to JPMorgan's internal investigative task force's report. To summarize: JPMorgan's Chief Investment Office needed a new value-at-risk (VaR) model for the synthetic credit portfolio (the one that blew up) and assigned a quantitative whiz to create it. The new model operated through a series of Excel spreadsheets, which had to be completed manually, by a process of copying and pasting data from one spreadsheet to another. The internal Model Review Group identified this problem as well as a few others, but approved the model, while saying that it should be automated and another significant flaw should be fixed. After the London Whale trade blew up, the Model Review Group discovered that the model had not been automated and found several other errors.
Microsoft Excel is one of the greatest, most powerful, most important software applications of all time. Many in the industry will no doubt object. But it provides enormous capacity to do quantitative analysis, letting you do anything from statistical analyses of databases with hundreds of thousands of records to complex estimation tools . And unlike traditional statistical programs, it provides an intuitive interface that lets you see what happens to the data as you manipulate them.
As a consequence, Excel is everywhere you look in the business world, especially in areas where people are adding up numbers a lot, like marketing, business development, sales, and, yes, finance. For all the talk about end-to-end financial suites like SAP, Oracle, and Peoplesoft, at the end of the day people do financial analysis by extracting data from those back-end systems and shoving it around in Excel spreadsheets.
Yes, Excel is very powerful, this software is one of the most complex software that we have access to. On the job Excel is very prevalent, whether it be inputting data for payroll purposes, or to create spreadsheets for management. Microsoft does a lot for the computer world, this software is only one example of how this company provides computer users with a variety of programs and ways to store and display pertinent information. Companies such as JP Morgan which was talked about in the blog, use simple spreadsheets from Excel to build a platform for even bigger projects. Excel is the best way to input and display data in a way that is universally viewable, and can be used by majority of all computer users.
ReplyDeleteBusinesses today are far more advanced technological wise than ever before. With the increase in technology in what is already becoming a paperless society, businesses need ways to collect, arrange, and organize their data. Excel makes it possible for businesses to do this quickly and effectively. Businesses want employees who can understand and use excel. This is why a lot of older workers are being laid off for younger ones. Older workers tend to become fixated in their ways and aren't willing to learn how to adapt to new technology and changing times. Excel gives businesses an effective way to display financial infer and contact info through the use of spreadsheets. Pretty much everything that is need to run a business can go into excel. Excel is online accessible, great for presentations, and can identify trends it notices in the data. Businesses are starting to ask about knowledge of excel in interviews and other application processes. As we can see, knowledge of excel can be a very important asset for a person to have.
ReplyDeleteThank you for sharing. There is no arguing that Excel is a vital part to any individuals success in the work force. The value of being able to properly and efficiently navigate is Excel is a key necessity for any individual looking to into today's current labor market. Excel allows for business analysts to be able to complete a wide array of task in a speed greater than before. therefore current business will not consider a candidate if he is not able to use Excel. Therefore, it is necessary for people to understand the power of Excel and learn how to use it effeciently.
ReplyDeleteThe business world is constantly evolving, learning Excel is a must. Excel is one of the greatest software created . College students must know how to operate excel before they enter the workforce. Excel have numerous benefits, it can be used in a variety of ways. Excel can be used for marketing, functional analysis, accounting, and payroll.
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