Banks vs Tech Giants

Discussion in 'Politics' started by NorseMythology, Mar 24, 2015.

  1. I needed a laugh
    Thanks
     
  2.  
     
    I speak fluent finance. Let me translate: "It's vital that regulators provide a level playing field, giving our competitors the same expensive regulations to comply with that we have to deal with."
     
  3. Such regulations to stifle competition, luckily Google, Apple and Facebook have deep pockets.
     
  4. I speak a different dialect of finance, what I got was "We must eliminate competition so that the banking interests we serve can remain in total control of the country's financial sector" 
     
  5.  
    Those deep pockets according to the FCC in Googles cases has lead to wide spread abuse. They stiffle searchs, steal technology then threaten you with search results if you complain etc. That made the news this week on Google. The deep pockets of Facebook leads to a dramatic abuse of privacy. Apple's deep pockets had lead to human suffering on a scale unparalleled just about in Asia. They put suicide nets around the factories that make Apple's products not to long ago.
     
  6. That is because money is valued over human lives :-(

    Your objection to facebook is not a violate on their part per se, its implicit when one signs up and adjusts their settings. I made a facebook account but never used it though.
     
  7. Same thing they are doing to crypto-currencies.
     
  8.  
    Money has, is, and will continue to be valued over most things. Money grants you things, grants you power, grants you just about anything but love even then you they can pretend and make you happy or at the very least a hot piece of ass.
     
  9. it's not just the tech giants.
     
    banks are losing money to start-ups... and they are feeling the heat. for most big banks the problem is that financial technology world is 10 years behind (at least) compared to other industries. old school banks have no other way to "compete" but to force more regulation..
    most of their systems are so outdated and complex, that it is simply impossible to go head-to-head with technologically savvy companies. 
     
    it will be very hard to slow down the progress.. big banks can complain all they want, but the game is changing before they can react. 
     
    http://www.swissinfo.ch/eng/bloomberg/-dinosaur--private-banks-losing-to-startups--abn-amro-exec-says/40795368
     
  10.  
    You would be incorrect the largest employer of physicists and mathematicians in the world is the Finance industry. The networks they have developed, formulas are unparalleled. Read this book...
     
    http://www.amazon.com/My-Life-Quant-Reflections-Physics/dp/0470192739/ref=sr_1_1?ie=UTF8&qid=1427333150&sr=8-1&keywords=life+as+quant
     
    The scientists that choose to go into finance are called "Quants"..and there are many. Some of the most advanced supercomputing networks are owned by companies like Goldman Sacs, etc.
     
  11. Why do they need physicists?
     
  12.  
    that's not what i meant. 
     
    look at companies like wealthfront, betterment, envestnet, ally bank, etc. their infrastructure is light years beyond what td ameritrade and schwab have in place, for example.
     
    when every other industry uses restful api's to exchange data old brokerage houses rely on good ol' csv file transmission (which most companies abandoned in the 90's). they just started using electronic document signatures and many companies still do not accept electronically signed documents. 
     
    many banks and RIA firms run on the software that written 25 years ago.. 
     
    the point is that even if there are one-off genius scientists employed by these companies, they are not building any public facing products which you need to have, in order to keep your customers and to compete.
    take acorns app for example .. it is based on a very basic concept of portfolio rebalancing (like many new robo-advisors).. now even today many financial advisors rebalance their client's portfolio by hand. and yes, depending on the complexity of a portfolio you probably need a financial guru to accurately and properly rebalance a portfolio.
    or you can write a program, which will do all the same calculations in a matter of milliseconds day in and day out.
     
  13.  
    I think you just used finance dialect to translate my finance dialect of his finance dialect...[​IMG]
     
  14. i was stoned when i wrote that.
     
  15.  
    Not to derail your discussion, but I'm not really that impressed with companies like Wealthfront, Betterment, or Acorn. I went on Wealthfront and Betterment to see what type of portfolio they'd recommend and was less than impressed. They use a combination of passive index funds (which is what I own), and by no measurable objective was theirs more efficient than mine. If I remember correctly, my portfolio historically had better risk-adjusted returns by a small margin. It's debatable whether rebalancing (other than between the equity and bond portions) is even worth doing. I seriously cannot imagine paying someone to rebalance...Maybe they're useful services for people who aren't proficient in finance and able to find the efficient frontier. For me, I'd just be giving money away by using their sites.
     
  16. Corporate American is going to ruin America. A
     
  17.  
    They are sleeping with the government too, which always helps.
     
    Of course, which party is truly the dominatrix isn't always clear.
     
  18.  
    not too many people are financially savvy enough to build their own portfolios. let alone manage them.
     
    considering that there are over 13k RIA firms in the US, clearly people are willing to pay for money management. which on the basic level comes down rebalancing of the portfolio to adjust to the market conditions. some may only rebalance once a year others do it on a more or less frequent basis. 
     
    but going to the issue of technology, essentially you are solving the same problem in excel, on a piece of paper or by using some software. if this process can be automated then you have a business.
    so if your business is just a software at it's core (wealthfront) it needs to be designed, built and deployed in way that is done in 2015 not 1985 .. and banks or large custodians simply do not have the infrastructure in place to compete. 
    their best route is to buy small competing businesses, but even that becomes increasingly difficult because all of a sudden a company like betterment goes from $0 to $1.5 billion aum in a matter of 2 years... 
     

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