An increasingly obvious observation from this Economist piece on the value of social media for commerce.  In particular the original promise was that social media would allow companies to infer and interpret customer preferences in a particularly granular and specific way, by associating customers buying preferences with their friends and their buying behaviors. Too much buzz – Social media provides huge opportunities, but will bring huge problems | Economist Most commentary on social media ignores an obvious truth—that the value of things is largely determined by their rarity. The more people tweet, the less attention people will pay to any … Continue reading What is the value of Social Media to commerce?

There is a brilliant collection of essays in the Jan/Feb issue of Foreign Affairs.  There is one lead piece from Francis Fukuyama entitled the Future of History (premium) which borrows from the title of his earlier book The End of History.  The broad theme is the failure of politics and the problem with the rise of economics over politics that has led (his words) to the end of left wing idealism as a counterweight to the right.  Foreign Affairs:  He closes with this statement on what is needed: It would have to have at least two components, political and economic. … Continue reading “The Future of History” (Fukuyama) and what does it mean for the design of banks

As a follow up to my ‘Failure of Politics’ post, here is succinct piece from Francis Fukuyama, Stanford Senior Fellow.  In particular this paragraph caught my eye.  We often hear of the divisions of power amongst the various branches, and the immobilising effect of lobbying in US politics.  However this was a new one to me, that any of the 100 Senators can place anonymous holds on work proceeding for entirely selfish purposes.  Talk about designing a political system to fail! Oh for a democratic dictatorship and not a vetocracy | ft.com – Francis Fukuyama In addition to the checks … Continue reading “A Failure of Politics” 2–designing a system to ensure failure

The banking and economic crisis of 2007 has touched many aspects of our lives and a now a clear trend and fallout, is the failure of politics.  I am biased but I look at Britain and believe there is still a hardy attempt there to keep things moving.  I watched David Miliband (Left) and Bronwen Maddox (Rightish journalist)  today being interviewed by Fareed Zakaria.  While they commented on the UK economy and the arguments for and against austerity and stimulus aspects to budgets, it was notable that they do not paint themselves into a corner that cannot be exited. Now … Continue reading A failure of politics

This Europol criminal threat assessment (pdf document – OCTA 2011: EU ORGANISED CRIME THREAT ASSESSMENT) is fascinating.  It covers everything including drugs, smuggling, human trafficking and weapons.  But the financial section is what caught my eye.  I have been vocal for years that it is time for banks to offer payment cards with only a chip and with no magnetic stripe.  The detainment of the stripe is a classic case of building a compromise product based on the needs of the minority. First the financial impact: The EU is the world’s largest market for payment card transactions. In 2009 organised … Continue reading Around 80 per cent of non-EU fraud against EU payment cards is committed in the United States | Europol

In a quite negative comment Fitch, a ratings agency note that US Banks will suffer from any additional deterioration in Euro sovereign debt circumstances.  This is a classic statement of the obvious.  It is hard to criticize further because it is behind a paywall. Eurozone Contagion Threatens Outlook for U.S. Banks   Though U.S. banks have manageable direct exposures to the stressed European markets (Greece, Ireland, Italy, Portugal and Spain), further contagion poses a serious risk, according toFitch Ratings in a new report. Fitch believes that unless the Eurozone debt crisis is resolved in a timely and orderly manner, the … Continue reading What is the effect on banks from a shift to technocrat government?

I have been reading ‘Civilization – the West and the Rest’ by Niall Ferguson.  He analyses that there are 6 core institutions or principles that account for the success of the West over the last 500 years, with the obvious implication that as the West falls, the answer lies in reduced advantage in those 6 institutions. Eurozone turmoil: Enter the technocrats | ft.com “If you look at the troubles which have happened in European societies, this is purely because of the accumulated troubles of the worn-out welfare society. The labour laws induce sloth and indolence rather than hard work.” One … Continue reading More signals of systemic shifts of influence from West to East

Once in a while Martin Wolf is on fire.  Economists can appear somewhat dissociated from real life.  This piece is one where he strikes home.  If you have any doubts about skepticism about banks then read this.  Bob Diamond’s unconvincing defence | ft.com Did the economy at least benefit from the run-up in leverage? Hardly. We saw huge rises in banks’ exposure to one another, which worsened systemic fragility, and in the prices of – and debt secured against – property. Who thinks these provided durable benefits? Mr Haldane also noted that “The purchaser of a portfolio of global banking … Continue reading Banks continue to fight the wrong fight