'I love gambling. I've even bet on how many lace-up shoes were under the table at lunch'

Fiona Lafferty puts twenty questions to Michael Spencer, chief executive of Garban Intercapital Plc, the world's biggest money broker
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The Independent Online

1. What's the best piece of advice anyone has given you?

1. What's the best piece of advice anyone has given you?

My father said: "Don't employ people who always agree with you because you can agree with yourself and draw their salary."

2. What's the worst investment you've made, and the best?

The worst trade I did was in 1979 when I took a big short position in the gold market. Unfortunately, it was just before the Russians invaded Afghanistan and gold went from $200 to $800 an ounce. I remember the rabbit effect of being frozen in the headlights of an oncoming car. It was a disastrous position.I remember praying and praying that it would get better tomorrow, and then the agony of losing everything. It was not an experience to be repeated, but fortunately I learnt that lesson reasonably early in my career. My best deal was setting up the Intercapital Group, in 1986.

3. What was the first lesson you learnt in business?

If you want to be successful or get rich, there isn't a quick way of doing it. If you try to short cut you almost invariably finish up failing miserably.

4. Last year, some of your employees caused £20,000 of damage to a Hampshire hotel. Apparently, they let off fire extinguishers and dragged guests out of their beds. Did you sack them?

As always with the tabloid press the reality and the story were somewhat different. They did behave very badly, but it wasn't just my staff that got carried away, our clients did too. We gave our people a major bollocking and told them, and our clients, they were going to pick up the bill for all the damage. When you have 2,300 employees you have some tricky issues of what's sackable and what's not, but I didn't consider it a dismissible offence.

5. Why did you stop Intercapital's legendary annual parties?

They got to the stage where they were so good, they couldn't get any better and I wanted to quit while we were ahead. The other reason is that we could do that when we were a private company, spending our own money, but spending £500,000 on a party is difficult to justify when you're publicly owned.

6. Garban Intercapital was recently suspended from trading in Tokyo. What happened?

The Japanese authorities have been nit-picking to an extraordinary extent and made a great issue over technical infringements, which would not be considered heinous in any other regulatory environment. We were suspended for one week because we should have disclosed to the customer that we were trading as a principal through error, rather than as a broker. What happened was a perfectly normal part of our day-to-day business risk. We've built one of the most successful bond- broking businesses in Japan and we've overtaken a locally owned business. That says it all.

7. What single event or person gave you the impetus to succeed?

There wasn't a single event. I just knew that from the age of 15 I wanted to be a wheeler-dealer in the financial world. I won a scholarship to read physics at Oxford, which has been enormously useful because it gives you a strong mathematical bias. In hindsight, I wish I'd read politics, philosophy and economics.

8. Do you have a business philosophy?

That honesty and integrity pay off in the long run, and it is important to admit mistakes. I don't think anyone gets more than 60 per cent of their decisions correct. If, by definition, you think you never make mistakes, then how can you ever learn from them, and if you can't learn from your mistakes you ain't going to get much better at business.

9. Are you pro-Europe and the single currency?

I'm pro-Europe certainly and pro a single European market definitely, and I have nothing against the euro per se, but I'm profoundly against sterling going into Europe. All the arguments that the City would sufferer disastrously if we keep sterling out have been completely discredited. If we go into Europe, there will be European federalism and we will simply become a state within it. Continental Europe is fundamentally protectionist in its outlook and its employment laws are at least 25 years out of date. You only have to look at France, whose response to increasing unemployment is to reduce the working week to 35 hours. It's ludicrous.

10. Will you be voting for William Hague in the next general election?

Hague is a very underrated talent and a much more substantial politician than Blair. I didn't get swept up in the charm of New Labour, which has now been shown to be not much more than an elaborate marketing exercise. I have been a Conservative since as long as I can remember.

11. Do you still gamble and what was your most unusual bet?

I was once at a big City lunch where I started a market in the number of lace-up shoes under tables. Once you understand gambling you just somehow manage to feel your way on how to make a slightly better price than others. I used to love gambling - backgammon was one of my passions for a long time - but I now own a bookmaking business so it's more difficult because you can't gamble with your own firm and the competition don't like you to gamble with them. If I'm at Ascot I might have some casual bets for amusement but never anything serious.

12. What's your greatest personal indulgence?

Cheval Blanc, 1982

13. What was the happiest day of your working life, and the worst?

Shortly after we started the firm in May 1986 I didn't know in advance whether we would succeed or not, but as the summer started, business began to fade. I panicked throughout August then one day in September I did a huge deal, which paid four months of our overheads and I knew from then we were going to make it. There have been lots of worst days, particularly when I've had to sack close friends, but I'm pleased to say most have remained friends.

14. In terms of personal wealth, how much is enough?

I assume that one day I'll just lose my desire to make more and then I'll stop. If I left now I'm a rich man on paper, although I've secretly always had a big number in mind.

15. If your briefcase was about to be confiscated which three things would you retrieve?

My personal organiser, mobile phone and keys.

16. Where do you want to be five years from now?

I want to be working. I certainly don't want to be retired. The notion of spending my time on a beach in the Cote d'Azure fills me with horror, even though short visits to the Voile Rouge can be enormous fun.

17. Are you easy to work for and what makes you lose your temper?

In this type of business, you can't rule by threats, aggression or being remote. Successful social interaction is important and I think I'm popular. I lose my temper dramatically less frequently than when I started the business. I used to get stressed out all the time and I'd blow my top. Now I'm much more philosophical. One of my senior colleagues has an unerring ability to get me there from time to time, but it's not very often.

18. How do you envisage the money-broking industry five years from now?

There will be about three global firms, which will be highly technology orientated. A lot of business will be done electronically, particularly the high volume, "vanilla" business. The firms will be bigger but obviously there will always be specialist niche firms. Five years ago there were more than a dozen broking firms that had pretensions to being global. That is no longer the case because there have been huge numbers of mergers in the past few years and that will probably continue.

19. If not Garban Intercapital, which company would you most like to run?

I'd love to run British Airways because I think it's fundamentally a good airline. They've had problems with staff motivation and morale, which are issues I understand and handle every day. BA would be an enormous challenge although they'd be mad to give me the job.

20. If you went bankrupt tomorrow would you start again?

Yes, without a moment's hesitation. But I'm not going to.

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