Alphacution Feed

"Pay attention to what I say, not what I do..." More and more - over decades of practice - this opening statement has become the golden rule of marketing and communications, no matter if that "marcom" strategy is being applied in the context of finance, economics, politics - or, any other blood sport. Reason being: If you believe that perception is reality, then perception can have real economic consequences. However, with today's data ubiquity and resulting overload, we have the possibility of infinite perceptions and very little sense of reality... No one is truly to blame for this predicament. We have all conspired - most of us tacitly, some of us more directly - to participant in this confidence game. And so, when Alphacution picks out certain names, it is only to shed light on examples of how the game is played and not to pass judgement on the player(s) - since we are all more or less complicit... (As it turns out, Deutsche Bank is one of our best [...]

Disintermediation. And, desperation. That's what this is really all about. Together, these drivers produce an enormous amount of hype; a mixed wave of cryptocurrency insanity (and some blockchain legitimacy) washing over the global financial landscape... These days, it seems possible to transform any topic, no matter how dry or serious, into an all-out circus. And, it can be difficult - even for those most disciplined at rationing their limited attention - to look away as the spectacle unfolds. I mean, who can resist a tale that includes cornering the market on graphical processing units (GPUs), "chestahedrons," an Icelandic datacenter, the money flower, FUD and FOMO - among many other attention-grabbers? The Disintermediation Driver Now, typically, when the crowd rushes in one direction, I prefer not to follow - or, sometimes, head in another direction. Call it a bad case of intellectual claustrophobia. As a result, I haven't been eager to weigh in on any of this craziness. However, thankfully, the Swiss-based Bank for International Settlements (BIS) - sometimes otherwise known [...]

Take a deep breath... Focus your attention... And then consider: How bad do you want it? As a fellow #fintech entrepreneur, the reason I pose the question is that mass disruption and disintermediation (of status quo business models and "analog" workflow processing methods) is already here, and accelerating. In fact, chances are, you are involved in developing a digitally-savvy venture - likely related to #AI or #blockchain or #bigdata or #IaaS or even #cryptocurrencies - right now. We are living in a truly amazing and unprecedented period in history. And, should that venture be successful, your efforts will add to that disruption, winning you and team an invitation to the "other side" of fear, uncertainty and doubt (FUD), but also further perpetuating the ongoing skills mix shift to a more globally-diversified STEM workforce (weighted towards lower-cost regions), and continue the displacement of non-STEM personnel, many of whom are middle-aged, mid-management market veterans (some of whom with a woefully under-appreciated cache of rare, indigenous knowledge). What's more, our current techno-economic paradigm [...]

Before we dig into the latest numbers, let's level set the motivations here because, in the helter-skelter nature of most people's day, some of this analysis tends to get brushed aside as pedestrian. There is only so much one can do to make a headcount index sexy and provocative. But, this is something folks should be paying attention to. Banks are the biggest employers, the largest providers of services, and the most voracious consumers of technology in the global financial services ecosystem. As innovations strip away their dominance and incumbencies, people should want to know how the dominoes are going to fall because these players are currently interconnected with most everything that goes on in this space... Anyway, preamble (and gentle finger-wagging) aside, here's the setup: Why do we care so much about tracking bulge bank headcount? There are at least two reasons. The first is, well, a bit pedestrian, actually: Since we use headcount to normalize the variance in scale between banks (and other #fintech buyers) in order to [...]

Take a deep breath... Focus your attention... Now, consider that there are only about five people on the face of the planet who actually know the answer to our opening question - What does Citadel spend on technology?  Moreover, someone would likely need to hold one of these folks at gunpoint for that executive to spill those beans. The same scenario plays out for a firm like Millennium or DRW or Jump Trading or Two Sigma or IMC or any other privately-held manager. Only a hand full of the most senior people at any one of these mythological shops actually knows the answer to the question: What does [manager name here] spend on technology? Now, if we took one giant step further into the realm of absurdity, and wanted to know what any two or more of these players spend on technology - essentially attempting to answer the question: What does any Manager X spend on technology? - then the odds become significantly more improbable. What are the odds that [...]