Interest Rate, Regs and Tech
Life after LIBOR – I briefly touched upon the phasing out of LIBOR and the impact on the financial ecosystem in last week’s post. The Wall Street Journal estimates there is $170 trillion in outstanding LIBOR-based swap contracts. In addition, the rate is referenced in several trillion dollars of corporate loans, floating-rate mortgages, floating-rate notes and securitized products.
Read this article on Bloomberg which talks about the comparative merits and demerits of the subjectivity that goes into determining LIBOR (unlike SOFR which is determined by the bank operations). The article’s hypothesis on the increased risk of volatility with SOFR is definitely worth a read.
Members and Exchanges – Another development this week, the Member’s Exchange appointed Jonathan Kellner (a veteran of brokerage Instinet) to lead the U.S. stock exchange that some of Wall Street’s biggest traders are building. These include Citadel, UBS, Morgan Stanley and BAML. Given that these firms own a major percentage of total volume in the world’s largest stock market, the creation of this exchange creates a very credible challenge for New York Stock Exchange, Nasdaq Inc. and Cboe Global Markets Inc., the nation’s three dominant incumbents.
Regulatory Sandbox – Talk about credible! Here’s something we can all get behind – Wyoming became the second state in the U.S. after Arizona to open up a regulatory sandbox for testing out innovative financial products including but not limited to crypto-currency and blockchain based solutions. I’m enthused by these movements which will allow the United States to foster innovation and growth. These reg sandbox have been in place for a number of years at U.K., Singapore,and UAE. In fact, Policy Pal – an AI based solution to digitize and manage insurance contracts – was one of the first graduates from Singapore’s MAS sandbox.
Check out this excellent piece providing strong data visualization being leveraged for data with multiple dimensions.
It’s fun read looking at schedules for some world’s greatest creative people. The abysmal absence of exercise (dark blue) apart, the percentage of time spent on honing their craft (orange), despite day jobs (green) and other day-to-day activities (yellow) fascinated me. Of course, they did not spend as much time on their blogs!
Read the piece to look at the different visualization concepts. The graph that combines depth of ocean and tallest human built structures will make you want to both dive deep and climb high.
The world’s next Oligopoly
Talking of climbing high – is it right to think of google search as a software anymore? How is the Google search any different from electricity or a bus service or even depository services provided by a bank? That is the basis of Sen. Warren’s argument as she pushes for extended and more structured regulation for Big Tech, i.e. treating critical software services as a public utility.
Meanwhile, Google’s cousins from Crystal City, VA and no longer from Long Island – were busy acquiring the Yes Network and (surprisingly?) beating all comers to the production rights for Lord of the Rings. Big Tech taking over Hollywood?
On a related note, for all of us who thought that Big TECH was in trouble, here’s a data face to chew on – Facebook delivered its best-ever earnings in its most recent quarter, showing investors that advertisers continued to flock to the platform despite public scrutiny over how it handles users’ privacy.
Hence my take on the 2036 Olympics logo:
Blast from the Past
Here’s the big quotes from tech events this week, “that” year….
“Mr. Watson come here I want you.” – Mr. Bell to Mr. Watson, 1876
“I invented the Internet.” – Mr. Gore to the world, 1999
…For a Fistful of Dollars (Or a Bit More)
If Al Gore invented the internet, I invented real estate. Okay, I did’nt but last week I did talk about some worthy real estate options if you have a few $$ lying about. This week’s theme – Space Travel!!!
Jeff Bezos’ Blue Origin reportedly plans to start selling $200,000 to $300,000 tickets in 2019 to send tourists on 11-minute suborbital space flights. And Richard Branson’s Virgin Galactic has tickets to space for about $250,000 each.
And SpaceX recently announced billionaire Yusaku Maezawa will be its first customer for a private space flight around the moon – but the cost has not been revealed.
Quote of the Week
Do not let your fire go out, spark by irreplaceable spark in the hopeless swamps of the not-quite, the not-yet, and the not-at-all. Do not let the hero in your soul perish in lonely frustration for the life you deserved and have never been able to reach. The world you desire can be won. It exists.. it is real.. it is possible.. it’s yours.
*Ayn Rand, Atlas Shrugged*
And as always, Citius, Altius, Fortius!!