The Financial Services Club's Blog

Interesting stats from the Payments Council

Just received a press release from the UK Payments Council that makes interesting reading. 

The figures show that spending by card, cheque, cash and automated payments over the last six years has changed little, beyond the usual variance to consumers' payment habits, despite the difficult economic conditions.

The latest quarterly figures reveal that:

• The number of plastic card purchases - which includes debit and credit card purchases combined - rose this quarter by 6.9% and the value of purchases rose by 4.3%, compared with Q3 2008.

• Credit card spending by value fell by 0.7% although the number of credit card purchases increased by 2.5%.
• Debit card spending by value rose by 6.9% and 8.5% by volume when compared with Q3 2008.

• Gross credit card lending, which reflects all new spending on credit cards and includes interest, was 7.5% lower than in the 3rd quarter 2008. Reflecting this lower spending, repayments also fell but by 4.7%. Consequently the annualised ratio of repayments to new lending increased to 98.1% compared with 96.4% in Q3 2008.

• Debit cards dominated non-cash spending for the first time. Previously when reviewing all payments not made by cash, Direct Debits and Direct Credits made up the greatest number. However, this quarter debit cards accounted for 40.2% of all non-cash payments, whereas Direct Debits and Direct Credits made up 39.1%, when combined.

• Cheque and credit clearing volumes fell by 13% and values by 19%, between Q3 2008 and Q3 2009.

• The volume and value of Faster Payments rose by 11% and 12% respectively during Q3 2009, when compared to Q2 2009 - demonstrating the ever increasing use of the new service from one quarter to the next. This quarter, 47% of all standing orders and 73% of telephone and online banking payments were made using the Faster Payments Service.

• CHAPS Sterling volumes and values fell, as they were down 6.3% and 12.5% respectively from the corresponding quarter last year.

• The number of cash machine withdrawals rose by 0.5% compared with Q3 2008, whilst the amounts withdrawn fell by 0.7%.

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Fragmenting the banking structure

Most banks have evolved from days of branches and large offices, to banks with multiple channels of distribution and extensive technology backbones.

The issue banks have with this structure is that the technology backbone is broken.

This is well illustrated by a comment from one payments manager who said to me that he gets his highest rating for performance if he changes nothing. This is because the complex beast of transaction processing is best left alone. If it ain’t broken, don’t try to fix it. Leave it well alone.

This is why some banks have payments systems that are ten years, twenty years, thirty years old or even older. There is the classic story of one UK bank that still processes in pounds, shillings and pennies – a pre-decimal system – and Britain converted to decimalisation back in 1971!

But this just isn’t good enough anymore. Not only does it mean that banks are intransigent to change, but they will also be outsmarted by new players.

For example, it’s already seven years since Europe determined to introduce the Payments Services Directive and the Single Euro Payments Area, and we still have no end date in mind, nor do we have any idea how to get our customers to migrate to these instruments.

Many say it will be 2018 or after before we get to a fully-integrated Eurozone. That would make it a sixteen year change program.

Similarly, most banks will admit that there are so many councils created to provide governance over the change of these systems, that you can only move at the speed of the slowest player ... that is why change is so slow in the backbone infrastructures of this industry.

But it won’t be slow for the new entrants: the Payments Institutions.

It wasn’t slow for PayPal, who have rapidly become one of the largest payments processors by volume of transactions, and yet they are not even ten years old.

What PayPal achieved, and other Payments Institutions will do the same, is not just to build innovation on the old, out-of-date, legacy backbones ... but to completely rethink the payments process as a layer of innovation above the backbone.

This will happen more and more with other Payments Institutions.

Where this leads is that banks need to fragment themselves.

Break the bank into pieces.

Each piece should represent a piece of functionality, a process, a capability.

And for each piece of functionality, a process, a capability, the bank should ask hard questions: are we good at this? Should we be doing this? Could we provide this service to other banks? What would it mean if we did? How much do our customers value this? Would they pay for it?

Without this hard analysis, banks will stagnate in the sandpits of historical approaches, where legacy builds upon legacy, and the bank tries to serve all customers across all channels in a bank managed way.

Doing the above results in average and will never be exceptional.

Instead, banks should focus upon who they are trying to reach and serve, and in what way.

They should then look to see which areas of this service they can deliver exceptionally and, where it is average or below average, either improve it or junk it.

This means that the old way of banking, where the bank would deliver the entire infrastructure, product and service in a vertically integrated package, is no more.

Today, for banks to compete, they must focus upon where they have strengths, and outsource the rest to the best provider of the services they need to offer around their core competencies.

Equally, a bank must stop believing that they can serve all of the people all of the time. That is the reason banks have expensive legacy overheads because they are trying to keep the old products alive for the old customers, whilst trying to innovate services at the other end for the new customers.

The result of a bank believing they have to do everything internally end-to-end and serve all customer demands from legacy customer channels and instruments to new ones, is failure.

Banks must rationalise to categorically reach and serve the customers they want to reach and service the best, and internally restructure to process and manage only the parts of the customers’ processes they are strong at delivering internally whilst outsourcing the rest to the best.

Simples!

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We don't need your customer service

For a while now Monitise, the mobile payments processing firm, has been researching views on the future of banking with the Future Foundation, part of Experian.

Their objective is to find out how our relationship with money is changing and to understand how the culture of money will develop over the next few years.

The first research report was published last December, and focused upon the mobile internet and what that would mean for financial providers.

The second report came out in May 2009, and concluded that “consumers, led by young people, are migrating away from cash and towards digital transactions. The overwhelming benefit of convenience underpins the appeal of digital transactions and so does a deepening sense of trust in the technology.”

The latest report finds that Britons prefer doing their own banking, and would deliberately choose a computer or a mobile phone to manage their finances before phoning a call centre.  They don't want to deal with people in other words - whether in branches or call centres - but want to self-service wherever and whenever possible.

Key results include:

• One in five of us would prefer to log-on than dial a call centre and speak to a person

• This preference has grown rapidly - up from 1 in 20 in 2002 - as technology has improved and broadband become more widespread

• Unsurprisingly, it is the younger generation leading the way – with more than a quarter of 18 to 25 year-olds opting for technology ahead of the human touch

• Pensioners are also getting in on the do-it-yourself act, with one in ten logging-on or using their mobile phone to manage their money instead of call centre

• Fulfilling gender stereotypes, more men than women said that a major benefit of using technology to do their own banking was the lack of other people (22% compared to 13%)

The latest report was produced by the Future Foundation asking 1,000 adults in the UK for their views on the role of technology in customer service. The report is released on Wednesday.

All in all, it made me think it's just another hole in The Wall ...

Customer:

We don't want no human service,
We don't want your bank controls.
No charges or fees on my accounts
Banker, leave my cash alone.
Hey Banker! Leave my cash alone.
All in all, I only want ...
Another hole in the wall.

And, after a comment on silo-based functions in banks the other day, I thought that Bankers could respond with:

We don't want no integration,
We don't want no consistency.
No surly clients in the branch rooms
Customer, leave those tweets alone.
Hey Customer! Leave those tweets alone.
All in all, please just use ...
Another hole in the wall.

Things worth reading: 30th November 2009

Things we're reading today include ...

 

Today's must read:

The joke’s on us as Bling Central loses its sparkle - The Times

"Dubai has a £48 billion debt default and this has a knock-on effect for our own RBS, which was Dubai’s biggest loan arranger to the tune of some £1.4 billion, and HSBC, which has some £10 billion tied up in the state, and Barclays, which has an estimated £3 billion investment there.  The stock market fell by 3% when it became clear to the money men that Dubai was a busted flush — late last week (well spotted, boys).  It was evident to most of us a year ago that Dubai was well and truly rogered ..."

Banking’s fragility is exposed - The Times
Brown seeks to ease Dubai debt worries - The Independent
Abu Dhabi will not race to Dubai's rescue - The Telegraph
UAE central bank moves to head off run on banks in Dubai - The Times

Companies

BNP Paribas, Deutsche Bank Sue Bank Of America - KOAT
Author Banks voices anger on RBS - BBC
Traders stuck with LSE in spite of crash - Financial Times
Visa Electron to be phased out - BBC

Regulations

Sir David Walker says naming UK's millionaire bankers 'would drive them away' - The Telegraph
Critics attack Gordon Brown for failing to protect City as EU calls for super-regulator - The Telegraph
Lord Myners to investigate record bank profits - The Times

Markets

The Bank had £150bn ready to stop a run - The Independent
Scottish recession will continue deep into 2010, predicts Ernst & Young - The Independent
Neelie Kroes says rising state debt a 'time-bomb' - The Telegraph

Techonology

Cyber-criminals cashing in with online pharmacies - The Times

Quote of the Day:

“Getting arrested is the one memorable thing I can remember him doing.”
Former colleague of Paul Hopes, a 'quiet' accountant who embezzled $5 million to spend on fast living and loose women

 

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The Finanser's Week: 23rd November 2009 - 29th November 2009

The biggest news stories of the week include:

Dubai debt shock knocks £14bn off bank shares - The Independent
Chinese banks seek capital after lending binge - The Times
The Progress of Migration to SEPA, a keynote address by Gertrude Tumpel-Gugerell, Member of the Executive Board of the ECB at the British Bankers’ Association
Cheques to be bounced into history - The Times
LSE profits fall 37 per cent amid tough competition - The Times
LSE comes under fire after glitch halts trading for three hours - The Telegraph
Britain's bankers win double victory on bonuses and charges - The Times
£62bn mission to save banking sector within hours of collapse - The Times
Britain's bank bailout may have broken world trade rules - The Telegraph
Goldman takes too narrow a view to be doing God’s work - Chris Blackhurst, the Evening Standard

And our biggest stories of the week include:

This is the www.recession

People have talked about an L-shaped, U-shaped, V-shaped or even LUV-shaped recessions, but don’t believe them.  This is not a LUVerly recession, it’s a nasty one as demonstrated yesterday by the news that Dubai is deeply in distress.  The UAE's news will make this the www.recession.

I.O.U.S.A... now pay up!

Interesting film made last year about America's debt ... and now, according to the New York Times, it's come true.

End of the cheque: open outcry!

The Daily Wail, Britain’s second largest daily newspaper after the Pun, has just heard the new about the imminent demise of the cheque in the UK, as discussed here the other week. This is because the banks vote soon as to whether 2018 is the year of its removal or not.  In their article, they have some good bits, such as some great facts and over 280 reader's comments, as well as a lot of whinging.

Cheques: 2-4-6-1-8 ... 2018

After previous references to the cheque being phased out by 2018 in the UK, the Cheque Clearing & Credit Company has just released a nice explanation of the 2-4-6 rules, which is 2 days to clear and earn interest, 4 days to be available for spending and 6 days to be irrevocable for any cheque payment.

Russia's nerves creates massive volatility

After my meetings in Moscow last week, I’m wondering whether there is a Russian model of investing that could work with our Anglo-Saxon world of trading and meeting one of the key guys at MICEX, the Moscow International Currency Exchange (nothing to do with one’s gender), gave me a different view of Russia’s position.

Chi-X exploits LSE's weaknesses further

There’s plenty of innovation in banking right now, from investment through commercial to retail banking. This is no better illustrated than the announcement of the London Stock Exchange (LSE) with their 37% drop in profits when the FTSE almost doubled in value during the same period.  This is a strong indication of how innovators are disrupting, such as BATS Europe and Chi-X.

Zombie money in a chainsaw hell

I recently discovered that friends were killing me.  Literally ripping me to shreds with a chainsaw.  And it hurt.  I was mad.  In fact, I was steaming.  Then I found Spare Change.  A new form of money.  And, before you knew it, I had killed all my friends several times over.

Entrepreneurs avoid borrowing

Techcrunch analysed the views of 549 company founders to see what made them successful.  After “experience” and “management team”, “good fortune” was the third most important factor.  But the bit that intrigued was the way these guys started their businesses and what finances they used.

Monstra mihi pecuniam!

The story of the month has to be the scandal mentioned two weeks ago regarding the Hedge Fund Manager and the Prostitutes.

 

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For details of sponsorship email us.

This is the www.recession

People have talked about an L-shaped, U-shaped, V-shaped or even LUV-shaped recessions, but don’t believe them.

This is not a LUVerly recession, it’s a nasty one as demonstrated yesterday by the news that Dubai is deeply in distress.

Dubai's news will make this the internet, or WWW-recession.

Just as we get a bit bolder – with stock markets rising 60 to 120 percent in some regions – we then get our fragile confidence knocked for six.

Why is this so much of a shocker?

Because Dubai has been in denial of any issues for months.

For the past three months Dubai's leader, Sheikh Mohammed bin Rashid al-Maktoum, has always said there are no issues. He has adamantly claimed that he has made no mistakes and any rumours of issues between Dubai and Abu Dhabi are unfounded and the scaremongers should just "shut up".

So yesterday ends with everyone disappearing for the religious holiday of Eid al-Adha for a week, what does the Sheikh do?

Oh, he just says that the $80 billion worth of debt may be in doubt (btw, it’s probably twice that amount as that’s just hte official numbers) and could they postpone their mortgage payments on Dubai World and Nakheel, the two largest firms in Dubai.

Dubai World owns P&O (controversial buyout in March 2006) whilst Nakheel are the developers of the Palm Resort where David Beckman and other stars own properties.

What yesterday’s announcement really means is that Dubai can’t afford its debt. Not paying back the capital on its debt, but even paying the interest on its debt.This has been denied as an issue by Dubai until yesterday, and is a reflection that even with the $10 billion borrowed from Abu Dhabi, it’s not enough.

Dubai World on their own owe $22 billion and the issues of interest drifts on sovereign debt – the cost of borrowing has doubled in recent months – created this chasm of cost.

For the UK banks this is particularly difficult. Just as they were getting some sense of normality back in the system with share prices rising and Lloyds recapitalisation rights issue looking sound, the markets take a knock for six.

The thing is that the UK banks have been the most supportive of the region during the growth years ... which obviously means they would be the most exposed in a recession if Dubai does implode.

It is interesting for example, that for some time we have known the region has issues, with a mass exodus of workers leaving cars at the airport as they flee the country and their debts.

This is highlighted for me with the fact that I first visted Dubai in 2003 and there were a few buildings being developed, but you could count them easily.  Returning each year, it amazed me how many more new buildings were flying up, with what seemed like hundreds of new skyscrapers appearing each year.

In fact, with the ultimate arrogance, Dubai has most recently been building the world's tallest building for a cost of over £1 billion.  I also remember visiting the Burj Al-Arab Hotel a few years ago ...

 

... and seeing it's opulence, with gold leaf pillars and emerald encrusted walls, asking: "how much did this cost to build?"  The answer was that no-one knew.  They just said spend whatever it takes.

This would be fine for an oil-rich state, but Dubai is not oil-rich.  They realised twenty years ago that their oil reserves would run out before any other GCC nation, so they switched tack to create a logistics (cargo and port authorities), tourism and financial mecca for the Middle East.

And they have been on track to achieve this, but with the implosion of goods, tourism and finance in this crisis, their three main focal points, this is a bad time for Dubai.

Now whether this means the end of Dubai, another global knockdown, tighter lending or worse, we don’t know yet as it could not be as bad as it looks (really?!) ...

... but it does mean that the banks exposures to Dubai which people are saying is in the $13 billion to $40 billion range  – WHAT? that’s a massive range!!! Yes, but no-one knew what the cost will be as the Dubai authorities aren’t saying – will mean that the recapitalisation and rights issues of the UK banks means diddlysquat if partner nations move into meltdown.

All in all, a bad day and it’s no wonder that one City analyst described this as the new Lehmans.

Let’s hope he’s wrong.

The BBC has been collecting views from the region:

ANONYMOUS BUSINESSMAN, TEXTILE INDUSTRY

This news doesn't come as a surprise to anyone here, although the government has kept quiet on the subject and people don't discuss it. We've been concerned about the situation for quite some time. Since July we've had two increases in our electricity bills. Our monthly bill was £15,000, now it is nearly £30,000. That is a massive industrial price hike and it's totally unjustified in this oil-rich country.

SARAH, WESTERN JOURNALIST

Six months after I bought a flat, it lost more than half its value. I'm trapped here - even if I rent it, the rental income won't cover my mortgage payments.

MATTHEW, PERSONAL TRAINER

The word out there at the moment is that Abu Dhabi will bail Dubai out and people here are confident that sooner or later it will happen.

ANDREW, MANAGING DIRECTOR OF A COMPANY

I have to say, I think the West and the UK in particular focus too much on the negative stories from Dubai. Like all places, Dubai has been hit hard by the global financial crisis. But believing rumours of 5,000 cars abandoned at the airport, which has only 1,950 parking spaces, is a case of not letting the truth spoil a good story ... we have no rain, no tax and no jury service. I can think of many worse places to be.

PHILIP, FINLAND

Nakheel carried out the most ambitious projects in Dubai - too too ambitious and costly. They damaged the very thing that was Dubai's jewel in the crown - the beautiful white sandy beaches. Dubai needs to invest in a wider range of sectors: manufacturing, the service industry and perhaps more specialised industries. Unfortunately the emirate has learnt the hard way, but it will recover and it will be a good place to live and work in the future.

REBECCA, TEACHING ASSISTANT

I feel unsure about the future of Dubai. When I was listening to the news this morning I was thinking, if things get worse, maybe we should consider moving. It's not what I want to do, but the thought crossed my mind. As my husband says, Dubai has been going too big too fast and now there are not enough funds to sustain this development.

PAUL, DUBAI

A few of my friends lost their jobs, then over a period of three, four months most of my friends lost their jobs. Then I lost my job too. I was really hit hard. The bars and restaurants here were full of unemployed people, talking about moving. Then I noticed the small things - rental prices dropped massively, the daily commute to work in horrendous traffic took only 15 minutes instead of one and a half hours. Lots of abandoned cars in the car parks gathering dust ... greed played a huge part, short-sighted planning, an attitude of get what you can and get out, all played a big part. That's all over now, it's time for Dubai to mature. This is a good thing, I am staying as I know Dubai will come back as a vibrant, successful and truly amazing place to live.

JOHN, DUBAI

I never noticed those signs last year but now they are all over. There are so many office buildings empty here, giant letters on their sides spelling out how cheap the square footage is. There was no control, just wild building and even worse inflation. Now things are on the slide, you can pay your rent monthly and negotiate with desperate landlords for 50% reductions.

Cheques: 2-4-6-1-8 ... 2018

After previous references to the cheque being phased out by 2018 in the UK, the Cheque Clearing & Credit Company has just released a nice explanation of the 2-4-6 rules, which is 2 days to clear and earn interest, 4 days to be available for spending and 6 days to be irrevocable for any cheque payment.

Worth a look.

Here's the official blurb:

With market research confirming that consumer understanding of the cheque clearing process is still very low, the Cheque and Credit Clearing Company (C&CCC) has today launched an online film that helps explain the different stages involved in clearing a cheque.

The 'Animated Guide to the Cheque Clearing Process' is a two-minute film that clearly explains how a cheque is cleared - showing how, when and why cheques are moved around the country as part of this process - and what happens if a cheque ‘bounces’.

 The market research revealed that although the 2-4-6 timescales have been in operation since November 2007, very few people understand how these work in relation to the cheque clearing process.

Only 10 per cent know when they can expect to earn interest on money paid in by cheque (which is no later than two days after paying it in) and just 23 per cent of cheque recipients can identify when they are able to withdraw money (no later than four days for a current account or six days for a savings account).

Over three-quarters of cheque recipients (78 per cent) thought that the time when they could be sure a cheque could not bounce was sooner than it actually is (it is at the end of the sixth working day after paying the cheque in).

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Things worth reading: 27th November 2009

Things we're reading today include ...

 

Today's must see:

New PBS series - the Card Game

 

Today's must read:

The shocking headlines of yesterday is that Dubai and the UAE economy is possibly going bust:

Dubai debt shock knocks £14bn off bank shares - The Independent

Dubai was the poster child of the economic boom: a world of unimaginable luxury, impossibly tall towers, and islands shaped like palm trees. This week it became the epitome of recessionary bust. Global stock markets were left reeling yesterday after the city-state's spectacularly debt-ridden Dubai World holding company asked for an extra six months to pay the $4bn (£2.4bn) chunk due next month. In London, the stock market dropped by 3 per cent, its worst day since March. The French and German markets fared little better, and America's Dow Jones was only saved by being closed for Thanksgiving.

causing trading panic:

Dubai in deep water as ripples from debt crisis spread - The Times
Dubai finds Eid not such a good day to bury bad news about Nakheel - The Times
Dubai's debt shakes world markets - The Independent
Dubai - Financial Times
Dubai shock after debt standstill call - Financial Times

and big problems for the London Stock Exchange:

Traders 'panic' as LSE hit by double whammy - The Independent
Glitch halts LSE trading as Dubai woes trigger sell-off - The Times
LSE comes under fire after glitch halts trading for three hours - The Telegraph

 

Other news:

LCH.Clearnet needs clear path to Washington - Financial Times
Shareholders back Lloyds' record cash call - The Independent
Swedes back down on hedge fund pay rules - The Telegraph
More than 1,000 bankers in the City earn over £1m a year, Sir David Walker says - The Telegraph
Blueprint for future of banks being unveiled - The Independent

 

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Chi-X exploits LSE's weaknesses further

There’s plenty of innovation in banking right now, from investment through commercial to retail banking. And it’s not just amongst the big banks, the thriving banks and the growing banks but amongst the struggling banks, the tarnished banks and the zombie banks too.  For example, Citi is spending a billion dollars on new payments technologies this year, and there's plenty of innovation in their transactions services business.

But some innovators create new business models at the expense of the incumbents - that's the way it's supposed to be, isn't it?

This is no better illustrated than by the announcement of the London Stock Exchange (LSE) which has faced continuing difficulties, as shown by their 37% drop in profits when the FTSE almost doubled in value during the same period.

This is a strong indication of how innovators are disrupting, such as BATS Europe.  But the key innovator with first mover advantage is Chi-X, who launched over two years ago.

Announcing their results for the period between April 1st and September 30th yesterday, the LSE let it be known that the total number of trades in UK shares dealt on the exchange dropped 17% to 78.4 million, with the value of the shares traded falling 46% to £580 billion.

This is during a period when, between March and August, investors have seen the biggest rally in shares in half a century with the value of British shares up from £454 billion to £1.44 trillion.

This is why Xavier Rolet has cut prices and continues to do so (doesn't work), has shrunk the LSE’s workforce by 11% (let's shrink our way out of this), thrown out their TradElect flagship system (which just doesn’t work and broke again today) and is in talks to buy Turquoise (who are also struggling thanks to the Chi-X onslaught).

And how big is that onslaught?

Let’s put it this way, it now has such a large share of trading in most European exchanges that it is now the third largest trading platform for equities tradingl, just behind the Deutsche Bourse and Euronext, and bigger than Spain’s national stock exchange and the Swiss bourse.

It has managed to take a quarter of the trading in the FTSE 100 from the LSE, and this looks likely to increase, especially if LSE’s outages continue.

So what does Chi-X go and do? They only announce the next day that they intend to hire Alasdair Haynes, the hotly tipped contender to have taken the job that Xavier Rolet took earlier this year and also back in 2001.

In other words, the man who should have been CEO of the LSE is now the CEO of its likely slayer and successor, Chi-X.

Funny how the world turns isn’t it?

What would I do if I were heading the LSE, as it is easy to criticise and hard to strategise.

I would change the battleground and create a new market territory for the LSE outside the razor-thin margins of trading the most liquid stocks.

Focus upon creating new markets or generate a new platform offering razor-thin margin trading in other stocks or instruments

The trouble with this strategy is that with 75% of their business tied to the most liquid stocks today, it is too hard to consider as an acceptable approach.  It is too radical.

The thing is that all the radical things the LSE has tried so far have failed, and are likely to continue in this fashion unless they do something radical.

Meanwhile, the 75% liquidity isn't going to disappear overnight so keep that fat margin to fund the next generation of thin margin, and broaden and deepen the platforms.

They may well be doing this, with the implementation of MillenniumIT and acquisition of Turquoise, except that both appear to be second choice solutions to compete with Chi-X rather than first choice solutions to create a new battleground.

Roll on the next six months ...

Note: BATS Europe are also doing OK, with Bloomberg reporting that they “'aim to do between 8 percent and 10 percent by the end of the next year, doubling our market share in 2010' according to CEO Mark Hemsley said. 'We have a lot of new firms coming over and we’re benefiting from the increasing sophistication of the trading systems of the big brokers we signed up in the first wave.'

“Over the past five days, Bats Europe accounted for about 8 percent of U.K. FTSE 100 trading, 4 percent of France’s CAC 40 and 3.3 percent of Germany’s DAX on average, according to data from Bats. London-based Chi-X Europe drew about 25 percent, 17 percent and 19 percent, respectively.”

Note: Wall Street Journal headline - MTFs Capture 54% Of Europe's Dark Markets

A trio of alternative trading systems has seized more than half of Europe's "dark" equities market from broker-run rivals in just six months.

Chi-X Europe, Turquoise and Bats Europe together handled 54% of all trades executed by public dark pools in the month to November 19, according to Thomson Reuters. None of the multilateral trading facilities operated a dark pool before May.

Meanwhile, three established dark pools, Liquidnet Europe, ITG Posit and Nyfix Euro Millennium, saw their share of the market shrink to 39% in November from 98% in May, Thomson Reuters said. ITG launched Posit in 1998, while Liquidnet Europe went live in 2002 and Euro Millennium has been operating for 18 months.

Monstra mihi pecuniam!

The story of the month has to be the scandal mentioned two weeks ago regarding the Hedge Fund Manager and the Prostitutes.

It's been filling our papers for weeks, and is the sex harassment case between Canadian Jordan Wimmer against multimillionaire hedge fund manager Mark Lowe.

Here's just a small selection of the many headlines worldwide:

Investment firm at centre of £4m sex discrimination case 'paid £11000 tax in 2007' - Telegraph.co.uk
Why are payouts so unfair? - Guardian.co.uk
£4m claim woman Jordan Wimmer 'was scared of boss' - Metro
City executive Jordan Wimmer 'believed boss had hired a Russian hit-man - Telegraph.co.uk
Mark's Angels: The three glamorous women hired by millionaire financier 'to ... - Daily Mail
Sex emails and 'blonde' jibe led to £4m claim - Irish Independent
Discrimination isn't always so photogenic - Guardian.co.uk 
British banker Jordan Wimmer feared ex-boss Mark Lowe wanted to have her - NEWS.com.au
Canadian exec in UK sues boss for sex discrimination Telegraph-Journal
DiManno: Life is so dis-tressing for blonds Toronto Star
City executive in stiletto harassment case 'denied bonus over tax inspection ... Telegraph.co.uk
Blonde Suing Hedgie Was One Of Three "Mark's Angels" The Business Insider
City exec in £4m sex discrimination case claims bonus withheld over tax ... PersonnelToday.com
Brit boss sued by Mississauga woman sent lewd e-mail: Intern Toronto Sun
'He served me up like a piece of meat', ex-sales executive tells tribunal guardian.co.uk
£100million hedge fund boss denies hiring hitman to kill employee in 'sex bias ... Daily Mail
City sex discrimination case: full-figured comments sparked feelings of self ... Telegraph.co.uk
Boss 'took escorts to meetings' BBC News 
City boss told executive how he loved 'exotic' Asian women Metro

Nothing like sex and drugs and banking to create headlines ... but the piece that has had the most coverage in the last couple of days is the use of Latin by Mark Lowe, the Hedge Fund Manager.

Several papers have run full page analysis of his use of Latin in fact, with the best piece appearing in the Telegraph yesterday:

Ariane Gordji, a young woman seeking work experience, had asked Mr Lowe, an Oxford classics graduate, the meaning of: "Ego autem dico vobis: diligite inimicos vestros, benefacite his qui oderunt vos."

It's actually from the New Testament (Matthew 5:44) and means, "But I say to you: love your enemies; be kind to those who hate you."

Mr Lowe didn't bother with a translation and instead answered with a chunk of Catullus's Carmina (Latin from the first century A.D.), which is so sexually explicit that it wasn't openly published in English until the late 20th century.

"Irrumabo vos et pedicabo vos," wrote Mr Lowe, before kindly adding, "It's Catullus, not very polite."

Too right, it's not polite; in fact it's so rude that the English translation still can't be printed in a family newspaper."

Read the Telegraph to find out more about Catullus and yes, it's quite explicit.

Oh my ... and there's me being all for the status quo. 

In fact, this clip from the HBO Series Rome shows that nothing much has changed in 2,000 years (warning of explicit language): 

d

Oh yes, and in case you were wondering, Monstra mihi pecuniam! means Show me the Money!

Things worth reading: 26th November 2009

Things we're reading today include ...

 

Today's must read:

"The National Australia Bank has confirmed a spike in customers using its retail banking services from internet-enabled mobile phones is likely to lead to it replacing security pass codes - now sent by SMS - with biometric voice prints within a year because of growing security concerns."
What is next in mobile banking - voice biometrics (CIO Magazine, NZ)

 

Regulations

Britain's bankers win double victory on bonuses and charges - The Times

Walker review: main points - The Telegraph
Banks 'must reveal £1m earners' - BBC
Walker review - Financial Times
Walker warns banks: Back me or face nationalisation - The Independent

Banks win legal battle on overdraft charges - The Times
Overdraft fees: why the Supreme Court was right to stand up for beastly bankers - The Telegraph

EC seeks tighter control of hedge fund managers - The Telegraph
EU proposals rattle UK private equity - The Times

Bank Bailouts

Darling defends secret £62bn emergency loan - The Times
Treasury rift with Bank deepens over secret loan - The Times
Lloyds directors under attack after diclosure of HBOS loans - The Times

Companies

LSE profits fall 37 per cent amid tough competition - The Times
LSE meets Euroclear opposition on post-trade - Financial Times
ING shareholders back share issue and company split - BBC
RBS vulnerability was 'no secret' - Press Association
Swiss set to share UBS tax data - BBC
Competition in cash equities hits LSE - Financial Times

Markets

Bundesbank fears relapse as German banks face €90bn fresh losses - The Telegraph
5 reasons banks don't get it (and a few banks that do) - CNN

 

Quote of the Day:

"It's been a tough year for my husband. He now owns four banks and that incurs a lot of paperwork and a lot of post-work-hours stress."
Maggie Darling, wife of UK Chancellor Alistair Darling 

 

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Zombie money in a chainsaw hell

I recently discovered that friends were killing me.

Literally ripping me to shreds with a chainsaw.

And it hurt.

After all, I am meant to be the Zombie Priest in the Church of Goth, and no-one had beaten me before.

And where did that chainsaw come from?

I was mad.

In fact, I was steaming.

So I vowed to get a chainsaw myself.

Problem is that I would have to turn at least 40 friends into Zombies too (note: not Zombie Bankers), in order to earn enough points to buy a chainsaw.

And so far, I had invited over 200 mates to become Zombies and only 12 had bothered to do so.

How would I get 40 of them to turn?

It was a problem.

And I was still mad.

In fact, I was boiling.

Then I found Spare Change.

Spare Change sits on top of PayPal (which sits on top of the banking system) and, for a small fee for each transaction, allows me to make microtransactions and buy things to spice up my favourite Facebook apps.

Oh, thank heavens for Spare Change.

For just $5, I could buy a chainsaw. So I spent $50 and bought two chainsaws, plus a machete, shotgun, uzi, meat cleaver and bazooka for good measure.

Forget turning mates into Zombies ... just kill them.

Now, I am the Zombie Pope in the Cathedral of Death.

And Richard, the idiot who attacked me with a chainsaw, is dead meat.

Now you may wonder what the hell I am talking about, but the above is a real incident that occurred on Facebook last year, after I signed up for the game promotion of Resident Evil.

And Spare Change is a simple little Facebook app, that allows me to buy things in Facebook gameworlds. I blogged about this app, and others such as the QQ coin, a year ago if you want to know more.

And these gameworlds are growing into big business.

According to current estimates, the worldwide market for virtual goods is expected to approach $5 billion this year.

That’s $5 billion worth of exchanging stuff that doesn’t exist ... but it’s fun.

And it’s also incredibly quick to build a business.

For example, within a week of its launch, game company Zynga's new Café World game in Facebook had garnered ten million players.

Farmville, another game from Zynga that started this summer, already has over 60 million monthly users.

And analysts reckon that about a tenth of these players buy stuff so, if a tenth of Zynga’s 60 million farm players buy a cow or tractor for $5 this month, then Zynga are banking $3 million a month.

That is why another social game developer, Playfish, was acquired by the more traditional computer games developer, EA Games, for $275 million in cash last week.

This is big stuff.

Even bigger is the idea of using virtual worlds and social gaming to bling your profile.

That’s how China’s QQ coins started and soon became a phenomena. Today, QQ international boasts over a billion users and more than 500 million active monthly users. That’s four times the number of users of Facebook and six times more active users than PayPal!

Add on the microtransactions of iPhone apps, with over 1.5 billion iPhone downloads and over 100,000 apps now developed, and we start to see the world changing.

After all, if I charge $0.01 per download for an iPhone app, and get a 100 million downloads ... that makes me a millionaire. And with the SuBo effect, where a woman (Susan Boyle) appears in a UK talent show and is watched by over 300 million people globally via the internet in less than two months, 100 million downloads is not unreasonable for a good app.

These experiences, along with others such as Second Life’s Linden Dollar economy, indicate that the future of money is not money itself. We do not wake up and think about making payments and buying money, we think about waking up and thinking I’m going to use my money to buy something.

So money is purely there for the value exchange.

And if that value exchange can be achieved by using virtual coins, fantastic.

Conclusion: expect the world of the next decade to morph into a myriad of payment mechanisms that supplement, supplant and supply fun and games on top of the traditional banking network.

Oh yes, and expect billions of microtransactions to occur person-to-person globally.

 

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Things worth reading: 25th November 2009

Things we're reading today include ...

Today's must read:

After Lloyd Blankfein let slip that Goldman Sachs were performing "God's work", the revised Lord's Prayer has just been released:

Our chairman, who art at Goldman,
Blankfein be thy name.
The rally's come.
God's work be done.
We have no fear of correction.
Give us this day our daily gains,
and bankrupt our nearest competitors,
just as you taught Lehman and Bear a lesson.
And bring us not under indictment,
for thine is the Treasury,
the House and the Senate,
forever and ever,
Goldman.

Bank Bailouts

£62bn mission to save banking sector within hours of collapse - The Times

Shareholders in shock after banking bombshell - The Times

Lord Myners: shareholders risk 'sleep-walking' into another financial crisis unless they challenge companies - The Telegraph

Companies

Lloyds puts 60 per cent discount on record £13.5bn rights issue - The Independent
Lloyds launches record share sale - BBC
FSA fines Nomura £1.75m for rogue trades - The Telegraph
Lehman to thaw $11bn of frozen assets - The Telegraph

Markets

US economy recovering less quickly than forecast - The Independent
Federal Reserve forecasts better growth next year - The Times
King hints at a gentle end to printing money early next year - The Independent
Chinese banks seek capital after lending binge - The Times
Central bank outsourcing hits right note - Financial Times
We've paid the price to avoid chaos and we must learn from our mistakes - The Telegraph

*

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End of the cheque: open outcry! (UPDATE)

The Daily Wail, Britain’s second largest daily newspaper after the Pun, has finally got wind of the imminent demise of the cheque, as discussed here the other week. This is because the banks vote soon as to whether 2018 is the year of its removal or not.

In their article, they have some good bits, such as these great factoids:

• The ancient Romans are believed to have used an early form of cheque known as praescriptiones in the first century BC
• The English word cheque comes from the Arabic sakk, which refers to a written note of credit used by Muslim merchants
• The predicted number of cheques written per day in the UK in 2018 is 1.6m
• The average value of a personal cheque payment is £227
• The amount of retail spending still paid for by cheque is 3.9%
• According to the Guinness Book of World Records, the largest ever oversized cheque was 12m by 25m (39 ft × 82 ft)

But then the main body of the article provides the usual unhelpful rubbish such as: "the move was criticised by consumer groups, business lobbyists and charities representing the elderly.  They raised fears that vulnerable people, who have relied on their chequebook all their lives, will be left confused."

This is even though the Payments Council's research proves this is not the case and, in reality, it is like reading an article calling for us to give up the internet and return to logarithmic tables.

No wonder the almost 300 comments from readers say things like:

"If so few cheques are now being written out then surely it isn't beyond the wit and capability of the banks to be able to deal with them?"

"Of course they want to abolish cheques, why spend a £1 to process them when they can charge us a couple of quid for a direct debit. This will be the start, what next a £50.00 charge to open an account?"

"Electronic financial transactions are not secure, and the banks put the onus on the customer to prove that they the customer are not the fraudster."

"Without a cheque book I will no longer want a bank account, I will have to revert to using cash everywhere, and go back to gettinng pension from the post office in 'real' money."

What these comments demonstrate is that cheques may be a paper-based piece of ancient history, but it is not one that can easily be replaced by alternative means.

When you need to send a payment by post or are managing cashflow in a small business, the cheque is still the main method of payment and even with online and mobile banking, cards, PayPal and more, the cheque still has a place.

Until the banks provide a clear alternative, the arguments about the removal of cheque payments will continue.

More commentary today in lead opinion column by Rowan Pelling in the Daily Telegraph:

"My bank is always offering me indescribably useless "benefits", such as insurance I don't need, to justify charges on an account that's almost always in credit; now it's threatening to withdraw the one thing I find indispensable ... I just wish someone would set up a bank that gave you what you wanted: no fees for those in credit, handsome chequebooks, like those you used to get from Coutts or Drummonds, and freedom to phone your branch's manager directly. There would be a stampede."

Plus top reader's letters:

SIR – Last week I found I had not received the new cheque-book that usually arrives, so that I always have one to hand (Letters, November 24).
I phoned Lloyds, and was informed that it no longer sends out cheque-books automatically, as many big firms were no longer accepting cheques. It was the first I had heard of the bank's new policy and I asked for an objection to be registered because:
1. Paying utility bills by cheque gives me control over the date of payment. Where I have been forced to pay by direct debit I find it difficult to keep a check on payments;
2. Cheques are the only way to make a safe means of payment by post;
3. Cheques save keeping large sums of cash in the house;
4. They are a simple way to send money to private individuals and small societies.
Over the past two months, 20 out of 25 cheques that I have written have been to private individuals and small societies.
Diana Morgan
Swanage, Dorset

SIR – I am very fond of my cheque-book but those troubled by their possible demise should take heart.
When I lived in Amsterdam, I discovered that banks in the Netherlands do not supply cheque-books. My initial consternation was won over by their simple system of everyone from utility companies to charities supplying tear off forms on bills and the like, which one sent directly to one's own bank, asking it to make a payment.
This saves the roundabout method of writing a cheque, sending it the payee, their sending it to their bank, that bank sending it to one's own bank and the payment being made. It also removes the grey area of clearing, when money is in limbo.
The banks could reject the payment directly if, as often in my case, sufficient funds were not in the account.
If British banks abolish the cheque, could we not adopt a similar system?
Christopher Leach
London W11

SIR – I suspect that many a one-man business and their customers are looking forward to the demise of cheques.
Just think of the income to be hidden and VAT evaded through payment in cash.
Patrick O'Hara
Arden, Warwickshire

 

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I.O.U.S.A... now pay up!

Interesting film made last year about America's debt.  Here's the short trailer:

and you can download and watch the whole thirty minute movie from the IOUSA website.

What's the movie about?  Here's the short thirty minute description:

Wake up, America! We're on the brink of a financial meltdown. I.O.U.S.A. boldly examines the rapidly growing national debt and its consequences for the United States and its citizens. Burdened with an ever-expanding government and military, increased international competition, overextended entitlement programs, and debts to foreign countries that are becoming impossible to honor, America must mend its spendthrift ways or face an economic disaster of epic proportions.

OK, so that's the quiet, mild, meek view of the creators.

Trouble is that the New York Times reported yesterday that America is now being asked to fez up:

With the national debt now topping $12 trillion, the White House estimates that the government’s tab for servicing the debt will exceed $700 billion a year in 2019, up from $202 billion this year, even if annual budget deficits shrink drastically. Other forecasters say the figure could be much higher. In concrete terms, an additional $500 billion a year in interest expense would total more than the combined federal budgets this year for education, energy, homeland security and the wars in Iraq and Afghanistan. The potential for rapidly escalating interest payouts is just one of the wrenching challenges facing the United States after decades of living beyond its means.

Seems to sum it up quite well ... oh dear, and the UK is even worse!

At least we're still a good place for doing business though ...

Things worth reading: 24th November 2009

Things we're reading today include ...

Today's must read:

Goldman takes too narrow a view to be doing God’s work - Chris Blackhurst, the Evening Standard

"Where Goldman has come unstuck, and where Dimon has been able to strike a harmonious note, is in dealings with politicians and the non-financial media and wider public. Being smart on a particular trade or adding a twist to a merger is bound to earn the acclaim of your banking peers; making politicians and those who do not care for the intricacies of finance believe you can be a force for good is quite another. Dimon has got it; Goldman, alas, has yet to do so."

Banks

IMF leader Dominique Strauss-Kahn says public will not tolerate another bailout - The Times
Only half of banks' losses have been revealed, CBI summit told - the Evening Standard
S&P raises fears over health of some banks - Financial Times
Independence 'would cost banks billions' says OECD - The Telegraph
Britain's bank bailout may have broken world trade rules - The Telegraph

Regulations

Critics condemn backtrack on plans to identify highearning bankers as 'feeble' - The Telegraph
Lord Turner interview: Time for truth Adair and consequences - The Telegraph

Companies

RBS chief Stephen Hester and his slice of humble pie - The Times
JP Morgan Chase chief executive Jamie Dimon touted as successor to US Treasury Secretary Tim Geithner - The Telegraph

Markets

World economy grows again but risks remain, warns IMF - The Independent
China derivative rule change hits banks - Financial Times

Quote of the Day:

"Despite the financial crisis, cashless payments increased, on a global basis, by almost 9% to 250 billion transactions per year in 2008."
The Progress of Migration to SEPA, a keynote address by Gertrude Tumpel-Gugerell, Member of the Executive Board of the ECB at the British Bankers’ Association

 

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Entrepreneurs avoid borrowing

Techcrunch analysed the views of 549 company founders to see what made them successful.

After “experience” and “management team”, “good fortune” was the third most important factor.

But the bit that intrigued was the way these guys started their businesses and what finances they used.

Apparently, nearly all began by using personal savings first, and borrowings from business partners, friends and family or the bank only if necessary.

Maybe that's not surprising, but it is surprising the difference between borrowing versus using savings:

Obviously, entrepreneurs don’t like being in hock.

*

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Russia's nerves creates massive volatility

After my meetings in Moscow last week, I’m wondering whether there is a Russian model of investing that could work with our Anglo-Saxon world of trading and meeting one of the key guys at MICEX, the Moscow International Currency Exchange (nothing to do with one’s gender), gave me a different view of Russia’s position.

As mentioned last week, real-time settlement is key to Russia’s markets, because no-one trusts each other. This then inhibits leverage because of the need to deposit enough collateral to cover your position.

On MICEX, the Central Bank obviously has an ability to leverage as much as they want because they are guaranteed to pay back. The large banks, such as Sberbank, are allowed a reasonable level of leverage based upon a deposit of a percentage of their trading position, although I had the impression that this is a sizeable percentage. But everyone else has to deposit enough collateral to near enough cover their total trading. This inhibits trading and leverage, but at least it guarantees settlement which some might say is no bad thing.

But there is a bad thing.

Volatility.

As mentioned on Friday, the RTS Index has been bouncing around faster than a Bolshoi Ballet Ballerina this year. This is because no-one invests in Russian stocks or stock markets for the long-term. It’s all short-termism.

A casual trader will play with Russian stocks for six months and then pull out. An e-trader maybe for just a month. When asked “what is long-term in Russia”, my friend at MICEX calmly replied: “less than a year”.

You see you can get your fingers burnt real fast. We talk about short-sellers in Europe and America, but in Russia these guys are not just selling short, they’re selling Bashful, Grumpy, Sleepy, Sneezy, Happy, Doc and Dopey.

These are the ultimate of short sellers, and hence you can buy into Russian stocks in the morning and be a millionaire or a pauper by end of day.

That is why real time settlement is critical, and why positions, margin calls and trading structures are so key.

With MICEX, they claim to be trading around RUB 700 billion (GBP £17 billion / USD $25 billion) per day. Of that, over half is currency trading and the rest is everything from derivatives to equities, corporate bonds to treasury bills.

MICEX’s history is also interesting. The Exchange started just after Gorbachov’s reforms in 1990, as a division of the Central Bank of Russia.

Launched in 1992, it enabled currency trading which, before MICEX, did not exist in Russia.

MICEX were also at the heart of the bubble that led to the 1998 financial crisis in Russia, as GKOs were their stock in trade.  GKO’s - Gosudarstvennoe Kratkosrochnoe Obyazatelstvo’s - are short term state bonds issued by the state of Russia and traded on MICEX. Because people did not understand or know how to deal financial instruments in Russia back then, it meant that debt was generated without any sense of the obligation to pay back.

As a result, GKOs were originally traded for the short term in days and weeks but, as people saw these as state-backed securities, they gradually moved into being traded in months and years. In other words longer term, rather than short term.

The result of over issuing GKOs and trading them long instead of short meant that, by the end of the 1990s, GKOs were worthless and the market imploded, creating a financial crisis with effects still felt today.

MICEX survived because they had diversified beyond trading currencies and GKOs to trading equities.  Today, they trade a few hundred of Russia’s most liquid stocks such as Gazprom.

But the issue remains that, having had fingers burnt by trading long, no-one trades long today. Everyone trades short.

So there’s the rub.

By being short sellers, Russia’s markets are highly volatile and very liquid and, by being risk avoiders, Russia’s markets are totally geared towards zero risk. There is no risk in Russian trading as everything is geared towards real-time settlement. The only risk is technical risk if the systems fail.

A market with risk eradicated is not a market that can trade effectively.

Now I’m back in London and thinking that European and American markets are geared towards high risk arbitrage strategies based upon low latency leverage. We have market risk, credit risk, and operational risk.

But our market encourages risks, and this is also a market that cannot trade effectively, as recognised post the Lehmans collapse.

We are trying to baton down the shutters on liquidity risk and we talk about ‘likelihood of settlement’ as a part of the puzzle, although price and cost are just as important.

In Russia, there is no ‘likelihood of settlement’. Settlement is guaranteed.

But equally, in Russia, there is no long-term investment market.

So there may be a middle ground here, between highly leveraged risk strategies and guaranteed settlement; a middle ground between long-term investing and making a buck through a short selling bet.

Right now, the Anglo-Saxon model is broken, whilst the Russian model is yet to start working effectively to build commerce.

So, will the financial instruments of the Anglo-Saxon model play a part in building leverage and commercial growth in the Russian markets? The Russians certainly think so but if, and only if, the trading model can incorporate the risk management principles of the Russian model.

Things worth reading: 23rd November 2009

Things we're reading today include ...

Today's must read:

"Goldman Sachs Group Inc., which got $10 billion and debt guarantees from the U.S. government in October, expects to pay $14 million in taxes worldwide for 2008 compared with $6 billion in 2007."
Goldman Sachs’s Tax Rate Drops to 1%, or $14 Million (Bloomberg)

Regulations

Bankers are forced to disclose pay - The Times
Sir David sharpens his bank reforms - The Independent
Walker tells bank investors to be more involved - The Telegraph
Bank of England starts debate on lending surcharges - The Telegraph
Bank customers in line for £6bn refund of overdraft charges - The Times
Britain's bank bailout may have broken rules says WTO - The Telegraph
Regulator's torch to light up dark pools - Financial Times
Brussels warns on accounts rules - Financial Times

Companies

Tesco moves closer to full banking - The Telegraph
Mortgages before current accounts at Tesco - Financial Times
Nationwide lashes out at rescued banks - Financial Times
RBS dumping toxic assets on Ireland - The Times
Investors tell Goldman Sachs board to curb bonuses - The Telegraph
Dame Clara Furse to join the board at Nomura - The Telegraph
Wills Fargo swing band forced to change name by Wells Fargo - The Telegraph

Money

Cheques to be bounced into history - The Times

Markets

Soul-searching has much further to go - Financial Times

Quote of the Day

"We can't make the loan and we can't get a credit score because you're deceased."
Sorry, No Mortgage: Experian Says That You're Dead (Consumerist)

 

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The Finanser's Week: 16th November 2009 - 22nd November 2009

The biggest news stories of the week include:

Queen outlines new banking laws - BBC
Barclays accused of taking unfair advantage in Lehman purchase - The Telegraph
Tobin is not a mythical monster to frighten the City; it has a moral force - Guardian
John Varley's blueprint for successful and responsible banking - The Telegraph
JPMorgan to take full control of Cazenove - Financial Times
Bankers intent on flouting pay rules should quit mainstream, says Myners - The Times

And our biggest stories of the week include:

From Russia with Love

It’s the third week of November and usually I’m off to the USA for a tradeshow.  Not this year. My usual American show took place earlier this year and so I missed it and, instead of going to the US of A, I’m Back in the USSR.  Or Russia as it is today, a thriving economy of diverse ethics and structures.

Why is a ruble a ruble?

You may be wondering what I’m doing in Moscow ... it’s all to do with new opportunities as the doors open.  I was invited here to join a small software firm who have had success in the Russian and other emerging markets, and are looking for some advice as to how to get to the next level of business.  They are introducing me to their Russian clients, including the Stock Exchanges MICEX and RTS, as well as some of their core banking customers in the retail and commercial banking space.

What has MiFID done for democracy?

Fascinating meetings with the Russian exchanges RTS and SPIMEX yesterday. After my reference to military intelligence yesterday, you may wonder whether SPIMEX is something to do with finding out who started the swine flu pandemic but no, it’s the St. Petersburg International Mercantile Exchange. 

Mashup technologies in real-world banking

For a while, I've been trying to find some real-world examples of mashup technologies in banking.   Mashups are where many independent web services can be plugged together easily into a 'mashup' that is personalised.  Examples are easily seen in Facebook where video and games are plugged in by users at the click of a mouse.  In banking, there are a few examples, but in the real-world with consumers? Not really.  But I have found an IT provider who gave me a great example as to how this might work in banking.

Big push for iPhone banking

Wells Fargo, PNC, HSBC and more have all been rolling out iPhone apps for banking recently.  Now, in a major public push, NatWest have followed suit and are running a mainstream advertising campaign to support their release.  But are iPhone apps really up to the job?

Who can be trusted after the financial crisis?

Just found a great paper by the Centre for European Policy Studies (CEPS) titled: "Who can be trusted after the financial crisis?"  Using extensive research they draw four main conclusions, including the fact that European citizens really do not trust the European Central Bank!

Talking about bank failures

As we look towards the end of the year with America suffering one of the worst year's for bank failures in recent history (over 120 so far this year), I was impressed by an image at the Tretyakov Gallery of Russian Art in Moscow.

Get 1000's of card numbers for $750

I'm loving Robert Siciliano's latest blog entry on buying an ATM off Craig's list, and finding 150 feet long printout of card numbers because the bar owner who sold it to him forgot to delete the transaction history.

American word of the year: 'unfriend'

Every year the New Oxford American Dictionary chooses a word of the year.  This year's word is: unfriend, which is "to remove someone as a ‘friend’ on a social networking site such as Facebook."

The Return of Goodwin

Just found this great online game called Fat Cat Cash Back, based upon the escapades of Fred Goodwin.

 

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