gleedsaling

I confess – I’m stumped. I can manage a picture (the Christmas Tree in Brussel’s Grande Place, where I’ve recently attended the LSE’s excellent Brexit conference) but after that…

So we leave the EU, and Donald Trump is president. I suppose to look on the bright side, the EU debate may turn out, for the UK at any rate, to be a storm in a teacup, of more interest to ‘the international liberal elite’ (? how does one join this elite? is there a discount for retirees??) than the rest of the country. And in the States, the mid-terms are only a couple of years away (assuming Russia isn’t running the country by then).

But my Cassandra instincts tell me otherwise. Ten years of ‘austerity’ plus exit from the EU look to me like a return to the 1970s – with Southern Rail obligingly providing the industrial action. As for the US – how can so many supposed ‘Christians’ think backing out  of an international climate accord is a good idea?

Perhaps the UK will ‘muddle through’. I can recall the great economist Nicky Kaldor saying in 1980 (as the UK economy fell off a cliff) that we shouldn’t underestimate the resilience of the people and the companies at the micro level that made the macro economy work. Well, that resilience is certainly needed now.

And the US? – well, as I say, I’m stumped. Or should that be Trumped?

Mallaby on Greenspan

Good session last night at the LSE with Sebastian Mallaby talking about his book on Greenspan. You can see some pics on Twitter via #LSEGreenspan.

The discussion on whether interest rates/monetary policy should be used to deal with asset bubbles was interesting. Mallaby’s view was that the Fed could at least set interest rates, whereas trying to use regulation to deal with asset bubbles (and financial irregularities in general) was much more difficult – attempts to do so were bound to be mired in Washington politics and/or the ‘balkanisation’ of US regulation.

The position has echoes of Keynes ‘monetary policy a l’outrance’ – taking bold an decisive action to deal with a slump or boom. But Greenspan – ‘the man who knew’, as Mallaby explained, was not a man willing to act or confront. Knowing is only half, perhaps less than half, of what a central banker needs to succeed.

Good piece by Clayton Christensen and others on this – see http://bit.ly/2dReEdm. Includes  a useful business model descriptor and a life cycle of business models which reflects Michael Porter’s great chapter in Competitive Strategy on the transition to industry maturity.

An interesting interview in Fortune with a MasterCard exec (Michael Miebach) on why they are doing the VocaLink deal – interesting in two ways. First, the writer of the Fortune piece doesn’t appear to have heard the interview, as he focuses on P2P payments, which isn’t the focus of what Miebach was talking about. Second, in the interview itself, Miebach explains that, while they have a great position in cards, they don’t know much about ACH (viz interbank) payments, and think they should. No doubt the growth of near real time payments globally and the associated apps possibilities (like Zapp) are stirring MasterCard’s interest. Worth a listen! – http://fortune.com/tag/mastercard/.

So here’s a paper written originally for my children trying to explain what the EU is all about and why we need to remain:EU Referendum – A Guide for the Perplexed v2 I’m sharing it here as there is clearly a lotto misinformation out there from, inter alia, the Murdoch press.

Looks as if there is lot of interesting stuff happening in Copenhagen at the Money 20/20 conference – #Money 2020Europe on Twitter. Auka (formerly mCASH) for example has an interesting White Paper out on bank-based mobile payments (see http://auka.io/#/money2020 for your copy).

Auka’s cloud-based solution is offering banks a white label variant of Paym and ZAPP in the UK –  P2P smartphone payments and an alternative for merchants to card payments and PayPal. It will be interesting to see how they (and their competitors) fare. Customer and merchant uptake will be the problem – why would customers use this rather than Apple Pay (or the Android alternative when it lands in Europe)?

In case you are wondering why you have seen fewer posts of late…

Since March this year I have been working on a couple of payments-related projects with CEPA (see http://www.cepa.co.uk, now added to the blogroll on the right). The projects have gone well, and I’ve enjoyed the interaction with the CEPA team. So I’m now joining them (on a part time basis) as a Senior Adviser to develop their work in financial services.

One of the great aspects of CEPA is their recruitment of ‘bright young things’ with up to date economics and quant skills. So there is a trade to be done – they can keep us up to date on the latest thinking in economics while we pass on some of our painfully-acquired knowledge of how management consulting works.

It had really been a very pleasant meal. A number of old colleagues from PwC and IBM days had gathered together to celebrate a colleague’s retirement anniversary – he’d retired 5 years ago and very sensibly thought one celebration wasn’t enough.

But time had passed and carriages had to be summoned – so the time had come to pay the bill for the food (Trevor, our host and the quinquennial retiree, was stumping up for the wine).

Now I should explain, in the light of what follows, that this was a highly educated and analytical group of people – a high proportion of Oxbridge, a couple who were running or had run a software business, a senior guy from IBM’s Analytics offering, and a futurologist. By way of parenthesis, I should also say that the futurologist had spent part of the meal explaining to us why his prediction that ‘internet shopping would never take off’ had been so far off the mark.

Anyway back to the bill. This seemed to be a classic situation to try using Paym, the UK’s new mobile payment application available to most people with a bank account and a mobile phone, which allows you to make payments via your mobile.

‘Why don’t we use Paym?’ I said

‘What’s that?’ ‘Never heard of it’ ‘No need, I’ve got the cash here’ were the remarks that followed – a rather deathly combination of zero awareness and zero interest when the concept was explained.

Undaunted, I ploughed on. I might add I’d registered for Paym with my bank, HSBC, when it was launched a year ago, and had been on the lookout for an opportunity to use it.

I had Trevor’s number on my mobile. So I logged into the HSBC website, pressed the Paym button, and put in the details. I pressed ‘Confirm’ – the screen cogitated for a few moments and generated an error message. It had some zeros and an eight in it – which I assumed meant Trevor wasn’t a Paym user.

Meanwhile the twenty pound notes were whizzing round. I could fondly imagine that if the bill (£35 a head plus tip, so two twenties did the trick) had been for an odd amount Paym might have been of use – but somehow I doubt it.

Paym’s issue of course is ubiquity – like the spread of the mobile phone, it’s only useful to you if the chap you want to pay has Paym installed. Mobiles have taken off because of the lack of a close substitute. Paym’s problem appear to be – cash!