Markets with Bertie: Pink papers, IPO frenzies, and why AI won’t replace your bartender just yet

After a long hiatus, Bertie found himself back in the land of his beloved Queen—may her soul rest in peace. Ever a creature of habit, even on vacation, Bertie continued his routine of reading the country’s leading financial daily. Labour had recently secured a historic landslide victory, so he expected jubilant headlines, brimming with optimism.

To his surprise, the newly elected prime minister’s approval rating had plummeted by a staggering 45% in just two months. Politics is full of dramatic falls from grace, but the speed of this decline was remarkable.

Being analytically inclined, Bertie headed to a nearby pub, intent on unravelling the mystery—and perhaps indulging in a pint of ale. The young bartender was chatty, and when Bertie voiced his curiosity, the bartender replied, “Have you heard our Chancellor of the Exchequer? Gloomy as anything! Blames the other party for everything. She seems to have forgotten she’s no longer in the opposition. If things are bad, don’t moan—tell us your plan.”

“There must be more to it,” Bertie prodded, sensing that this alone didn’t explain the dramatic drop. “Oh, there is! The prime minister and the missus got gifted clothes, football tickets, concert tickets—you name it. Not good, mate!” Even then, it seemed trivial to Bertie. Scandals back home usually came with extra zeroes and, at worst, resulted in a brief parliamentary uproar. “That’s it?” Bertie asked, perplexed. The bartender stared back and declared, “It’s hard to wear your principles when someone else paid for the suit.”

Read this | Markets with Bertie: ‘Geopolitical risk’ is to fund managers what ‘world peace’ is to Miss India contestants

Bertie chuckled, convinced that everyone in Britain spoke in quotable quotes—until he realized it was lifted straight from the day’s headlines.

(Graphics: Mint)

Whither AI?

Not a day goes by without Bertie encountering breathless commentary on how artificial intelligence (AI) will transform the world. Yet, in his own life, AI has barely made a dent—beyond improving how he searches for things online. Bertie admits he’s a borderline Luddite, but when smart people insist AI is the “next big thing,” he’s inclined to believe them.

More here | Smartphone makers are betting big on AI features. Consumers see them as gimmicks

During a recent trip to the Big Apple, Bertie posed the “next big thing” question to an industry heavyweight. “Improves productivity, yes, but it’s not life-changing,” summarised the doyen. “Makes the world a large searchable document and delivers answers in whatever format you want. But for now, not much else.” The real challenge, he explained, is that the most valuable information locked within governments and corporations will never be part of this searchable document, and those entities are always reluctant to share.

“Anything that requires legal or compliance validation will always need a human sign-off,” the executive continued. “Why was this drug prescribed to a patient? How did the court arrive at its decision? On what basis was the loan approved? AI can assist, but a human will have to decide.”

That made Bertie pause. “So, it’s just a gold rush for chips and data centres, and nothing substantial will come out of it?” he asked.

“I didn’t say that,” the gentleman replied. “It’ll get better. It will improve productivity to some extent in certain types of jobs, but it is not the silver bullet it is made out to be.”

Overwhelming response

Back home, Bertie’s favourite pink paper informed him that capital markets were very much “in the pink” of health. That same pink glow seemed to be spilling over into the pink papers themselves, with everything abuzz—SME listings, main board initial public offerings (IPOs), qualified institutional placements, and block deals. Bertie noticed several pages exclusively dedicated to IPO advertisements and companies expressing gratitude to investors for their overwhelming support during recent capital raises.

Also Read | Why history tells us to beware the IPO frenzy

What really caught Bertie’s attention, though, was a public sector bank boasting about multiple qualified institutional placement (QIPs) it had completed over the past few years—three of them, each larger than the last, all within the span of three years. He had often heard about the supposedly self-sustaining profitability levels these public sector banks had achieved. Yet the frequency of these capital raises puzzled him. It left him wondering: which shareholders were truly being thanked here—past, present, or future?

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