across disciplines is one of the best ways to improve our investment acumen.
Here is a summary of some of the best articles I read this week.
I especially try to not post Corona related articles as that is all
one gets to read in all traditional media.
If you like the collection this consider forwarding it to someone
who you think will appreciate.
Personal debt is going down
Credit-card debt in
the U.S. and other advanced economies has fallen. Fewer people are late on
their credit-card payments. Consumer demand for new borrowing—through credit
cards, personal loans and even pawnshops—is down sharply.
The main reason,
according to economists and financial executives, is government stimulus
programs launched in the U.S. and other advanced economies that have worked
unexpectedly well. The flood of money, along with debt-relief measures such as
deferred-mortgage and student-loan payments, has stabilized the finances of
many households and even left some in better shape than before the pandemic—at
least for now.
How Robinhood is fleecing
the very customers it was supposed to democratise
Welcome to the stock
market, Robinhood-style. Since February, as the global economy collapsed under
the weight of the coronavirus pandemic, millions of novices, armed with $1,200
stimulus checks and nothing much to do, have begun trading via Silicon Valley
upstart Robinhood—the phone-friendly discount brokerage founded in 2013 by
Vladimir Tenev, 33, and Baiju Bhatt, 35.
The firm has added more than 3 million accounts since January, a 30%
rise, and it expects revenue to hit $700 million this year, a 250% spike from
The problem is that
Robinhood has sold the world a story of helping the little guy that is the
opposite of its actual business model: selling the little guy to rich market
operators with very sharp elbows.
Instead of taking
fees on the front end in the form of commissions, Tenev and Bhatt would make
money behind the scenes, selling their trades to so-called market makers—large,
sophisticated quantitative-trading firms like Citadel Securities, Two Sigma Securities,
Susquehanna International Group and Virtu Financial. The big firms would feed
Robinhood customer orders into their algorithms and seek to profit executing
the trades by shaving small fractions off bid and offer prices.
The cart full of mobile
causing traffic jam on google maps teaches us a lot more
We shape our tools
and thereafter our tools shape us. Google Maps provides a particularly
illustrative example of that relationship. Not only is it a closed system, with
little transparency around what data informs it and how it’s used, but Google
Maps also uniquely shapes the physical world. If it picks up a traffic jam—real
or fabricated—it might redirect vehicles to less-traveled streets, in turn
putting strain on infrastructure that wasn’t built for the extra volume.
Systems people take
for granted involve inputs and outputs, and that they themselves are sometimes
both. It shows how simple it is to fool a product in which people put
tremendous amounts of faith. And it illustrates how maps aren’t neutral, either
in their creation or their interpretation.
For as long as there
has been commerce, there has been espionage. The methods for spying on
competitors have changed over time, but the desire to uncover a rival’s secrets
has not. Here’s a sample of some notable cases of corporate espionage.
Is the future of a car not a
driving doesn’t actually seem to be ready for the reality of messy, complicated
streets that are teeming with humans. Most experts now agree that full
self-driving tech is far from ready — and in fact, may never be ready. That is
a stark contrast from the claims from some companies that insist it’s already
self-driving cars face another problem of their own making: Their various
sensors and safety technology is actually making human-driven cars a safer than
their autonomous brethren. As just one example, automatic emergency braking has
already reduced rear-end collisions by 50 percent, and the National
Transportation Safety Board believes this figure will eventually rise to 80
percent. It seems that predictive or avoidant technology, combined with the
knowledge of a human driver, is a better solution to the problem of collisions
and injury than cars that just drive themselves.
Disclaimer: Abhishek Basumallick is the Head of the equity advisory www.intelsense.in for long term wealth creation and a pure quant focused newsletter at www.quantamental.in. The blog posts should not be construed as investment advice. Please do your own due diligence before investing.