Capitalogix

Here Are Some Links For Your Weekly Reading - March 17th, 2019

The US grounded the Boeing 737 Max after similarities between two crashes. It's good they did, safety first, but it definitely caused some headaches coming back from Saskatchewan.  There's an interesting thought experiment here to understand the complexities that the airlines had to solve.

Imagine a 737 holds 200 people and does 4 or 5 flights a day. American has 24 737s in its fleet. That means each day ~24,000 people are displaced on American Airlines alone. They're replacing those planes with smaller regional jets – meaning more flights, more small airports, and more delays. The logistical/supply chain dynamics are a nightmare. 

 

 

Here are some of the posts that caught my eye recently. Hope you find something interesting.

Lighter Links:

• DARPA's New AI, Machine Learning 'Breakthrough'. (Realcleardefense)
• Dr. Elon & Mr. Musk: Life inside Tesla's Production Hell. (Wired)
• The Psychology behind Costco's Free Samples. (The Atlantic)
• The Fall of Rome and the Lessons for America. (Time)
• How Timeboxing Works and Why It Will Make You More Productive. (HBR)

 

 

Trading Links:

• Despite Store Closings, There's Still One Blockbuster Store Left in the World. (USAToday)
• Oracle's Larry Ellison Has a $1 Billion Stake in Tesla. (TheStreet)
• Mansa Musa: the Richest Man Who Ever Lived. (BBC)
• Amazon Go Cashierless Stores are Coming to Airports. (VentureBeat)
• Millions of Japanese Homes are Abandoned, and Owners are Giving Them Away for Free. (BusinessInsider)

Here Are Some Links For Your Weekly Reading - March 10th, 2019

I was in Toronto this week – and it was COLD!

Daylight Savings Time just springed forward ... and here in Texas, it is getting warmer.  Perhaps winter is over?

Here are some of the posts that caught my eye recently. Hope you find something interesting.

 

Lighter Links

• The World's Fastest Supercomputer Breaks an AI Record. (Wired)
• Study Shows Parrots Can Pass Classic Test of Intelligence. (Phys)
• Huge Spider Drags Opossum across Amazon Rainforest Floor in Horrifying Footage. (Video)
• H.I.V. is Reported Cured in a Second Patient, a Milestone in the Global AIDS Epidemic. (New York Times)

 

Trading Links

• Bill Gates Reveals the 10 Breakthrough Technologies that Will Change the World in 2019. (Forbes)
• Artificial Intelligence Regulation Will Be Impossible. (Forbes)
• Scientists Just Pulled CO2 from Air and Turned It into Coal. (Forbes)
• Map: The Most Valuable Brand in Each Country in 2018. (VisualCapitalist)
• Who's the Richest Owner in the NFL? Cowboys' Jerry Jones Doesn't Even Crack the Top Three. (CBS Sports)

 

The Relationship Between Stock Exchanges and Indices

Last year, I wrote about how the top 16 exchanges each have a market capitalization above $1 trillion.

That's a staggering amount of money being traded; but, how much of is it traded well?

82% of funds trailed their respective benchmarks over 15 years, and Indexes consistently beat stock pickers. 

With the NYSE and NASDAQ being the two biggest stock exchanges, looking at them can provide a lot of insight. The NYSE has 2058 companies, and the NASDAQ has 2588. 

 

via VisualCapitalist

 

With active managers' struggle to beat the market, many investors have moved to index-tracking funds (as of last year, investors withdrew $1.2 trillion from actively managed U.S. funds since 2007, according to Morningstar). 

My prediction, active management becomes a lot easier with AI and machine learning. You'll be hearing more about that from us soon. 

Funding Fintech's Future

I think it’s clear that Fintech is getting a lot of attention from the press, investors, and talent.  It is a hot space!

Here is a chart showing the Fintech companies that got the most funding recently.

 

via howmuch

Rapidly maturing sectors are payment processing, personal finance, and blockchain/crypto.

• Payment Processing - Stripe received $685 million in funding last year and is valued at over $20B
• Personal Finance - This is a broad market, but we're seeing the "average joe" empowered to make smarter personal finance decisions with companies like Robinhood, Acorns, and Credit Karma. Credit Karma raised $869M and is valued at approximately $4B
• Blockchain - While crypto is currently out of favor for many, blockchain is still an exciting prospect. Opendoor is bypassing real estate agents and brokers to disrupt the housing market. Receiving over $1B in funding last year, it is currently valued at $3.7B.

These are the sectors getting the most Fintech funding now (with payment processing the clear leader).

In my opinion, real disruption is brewing in the personal finance & Wall Street sectors ... and funding is ramping up there as we speak.

This Fintech sector reminds me of biotech.   Solutions have to be more mature and fully-tested before unleashing them on the public.  But winners will Win!

Wall Street is one of the smaller sections in this infographic.  Nonetheless, I think you'll be reading a lot more about this space soon.  Here are some of the companies worth noting.

• Symphony  does secure communications for companies like JP Morgan and Goldman Sachs. It helps with internal communication, and client-centric communication, and has various bots and apps to decrease decision time. 
• Addepar claims to "power the global financial system".  It's a performance reporting platform meant to provide better insights, and connect assets to goals. 
• Carta does equity management; helping private & public companies manage their cap tables, investments, and equity plans. 

Not seen on these lists are all the smaller companies at the beginning of their innovation cycle, and the companies doing their best to stay under the radar. More competitors and more opportunities mean more reason to keep your cards close to your chest. 

The funding cycle is always two steps behind the innovation cycle, which means ideas we've been hearing about from the likes of Gartner will be seeing increased publicity soon. 

I think 2019  will be a great year for innovation. What about you?

Here Are Some Links For Your Weekly Reading - February 17th, 2019

NASA's Mars Opportunity Rover has officially lost contact with earth after a fierce dust storm. Its last message was "My battery is getting low and it's getting dark." The rover's original mission was scheduled for 90 days ... it lasted 14 years. 

 

via XKCD

 

Here are some of the posts that caught my eye recently. Hope you find something interesting.

 

Lighter Links

• A Quantum Future Awaits. (Science)
• Can We Make Artificial Intelligence Ethical? (Washington Post)
• Life's Secret Ingredient: A Radical Theory of What Makes Things Alive. (NewScientist)
• What Does "Dead" Mean? the Debate Continues Some 50 Years after Harvard Defined Death. (Forbes)
• Scientists Have Built a Real Star Trek 'Replicator' that Builds Objects with Light. (ScienceAlert)

 

Trading Links

• Warning: Stocks Have Only Been Stretched this Thin Once in the past 150 Years. (MarketWatch)
• From the Year When Nothing Worked in the Financial Markets to the Month When Everything Did. (CNBC)
• Mark Zuckerberg Adds $6.2 Billion in a Day, Vaulting to No. 5 Richest in World. (OCRegister)
• American Billionaire Hedge Fund Manager Has Spent $700M on Personal Real Estate in Five Years. (CNW)
• There's a New Movie Coming out about High-speed Trading on Wall Street, and It Looks Bonkers. (BizInsider)

 

 

Presenting at IBM Think! 2019

This week, I spoke on stage at IBM's Think! 2019 conference in San Francisco. Our topic was "Gaining a Financial Edge through Fast Data and Analytics."  I think it went well (both the presentation and our exposure to lots of useful technology, talent, and opportunities).   

Moscone Center was filled with people clamoring for information about artificial intelligence, big data, and flexible computing (think of it as being able to do what you want locally, in the cloud, or with a hybrid cloud ... or through hardware or software).  That means solutions are becoming independent of how they are produced, delivered, or consumed.

Here is a picture of our team there.

 

 

Another cool topic that got lots of attention was Quantum Computing.  Here is a picture of me with one of the first Quantum Computers.

 

 

Pretty Cool!  But, remember, the hype cycle precedes the adoption and benefits cycle.  This will be an interesting decade.

The conference was in San Francisco.   That is where my oldest son lives. Lucky for him, the most romantic Valentine's Day dinner is one spent with your dad right?

 

 

I thought it was fun.  For them, at least there was Absinthe involved to dull the pain.

The Bizarre and Surreal Works of Deep Learning AI

One thing that Deep Learning excels in is analyzing pictures & videos, and creating facsimiles or combining styles. If you want to create art with deep learning look no further than the Deep Dream Generator or deepart.io which use Convolutional Neural Networks to combine your photo with an art style (if you want to do it on your phone another cool tool to check out is Prisma). 

via SubSubRoutine

Deepfake is it's exactly what it sounds like ... the use "Deep Learning" to "Fake" a recording.  For example, a machine learning technique called a Generative Adversarial Network can be used to superimpose images onto a source video.  That is how they made this fun (and disturbing) Deepfake of Jennifer Lawrence and Steve Buscemi.

 

via YouTube

While this is a fun example, Deepfakes create very real concerns. They're often used for more "nefarious" purposes (e.g., to create fake celebrity or revenge porn and to otherwise make important figures say things they never said).  It's likely you've seen videos of Trump or Obama created with this technology.   But it is easy to imagine someone faking evidence used at trial, trying to influence business transactions, or using this to support or slander causes in the media.

As fakes get better and easier to produce, they will likely be used more often.  So, as a reminder, don't trust everything you see on the internet. 

But also ... Technology is pretty freaking cool. Right?

 

Here Are Some Links For Your Weekly Reading - January 27th, 2019

Here are some of the posts that caught my eye recently. Hope you find something interesting.

 

Lighter Links

• Giving Algorithms a Sense of Uncertainty Could Make Them More Ethical.(TechReview)
• How Musicians Communicate Non-Verbally While Performing.(PsychCentral)
• Welcome to the World's Largest Gathering of Humans. (NPR)
• The Evolutionary Advantages of an Addictive Personality. (Scientific American)
• George Orwell Predicted Cameras Would Watch Us in Our Homes; He Never Imagined We'd Gladly Buy and Install Them Ourselves.(OpenCulture)

 

 

Trading Links

• The Weaponization of Artificial Intelligence. (Forbes)
• Apple Named 'World's Most Admired Company' for 12Th Year in a Row.(MacRumors)
• The Government Shutdown May Ripple through the IPO Market for Months. (Quartz)
• Billionaire Ray Dalio Shares a 3-Step Formula for Anyone to Start Investing.(CNBC)
• Ex-Goldman Banker Describes Finance as "Dark Art," Advocates Running McDonalds Franchise Instead. (News)

 

Here Are Some Links For Your Weekly Reading - January 20th, 2019

Most citizens don't have big savings account to buffer them against an unexpected expense or loss of income.

The Government Shutdown is one of the curveballs most workers haven't planned for adequately.

 

Actions have consequences.

Here are some of the posts that caught my eye recently. Hope you find something interesting.

 

Lighter Links

• Full Translation: China's 'New Generation Artificial Intelligence Development Plan' (2017). (Newamerica)
• Apple Buys 50 Business Class Seats from San Francisco to Shanghai Every Day. (MacRumors)
• Ford Built a Sweaty Robot Butt to Simulate Your Sweaty Human Butt. (BGR)
• Intimate Portraits of People over 100 Years Old Reveal the Beauty of Aging Bodies. (MyModernMet)
• Costco is Selling a 27-Pound Tub of Mac and Cheese that Lasts 20 Years. (BusinessInsider)

 

Trading Links

• Fear of Algorithm Trading is Really Just the Fear of the Unknown. (Quartz)
• Hedge Funds Suffer Worst Year since 2011. (FT)
• Nearly Half of Workers Earn Less Than $30,000. (Ritholtz)
• Michael Dell Gets $12 Billion Richer with Break from Public Eye. (Fortune)
• The New Impossible Burger 2.0 Won Everyone's Mouth at CES 2019, but That's Just the Beginning. (Forbes)

A Quick Visit to Cuba

I went to Havana with a diverse group of business people, financial professionals and representatives from the US Fed. 

Here is a photo taken with some of the classic cars that proudly dominate the roads despite cheaper Russian and  Chinese alternatives.

 

 

The city was beautiful … dirty and broken, for sure … but still beautiful.  Here is a view from my hotel room.

  

 

I commented that it was almost like seeing a severely wounded elephant. You can tell that it's hurt (and barely a shadow of its old self). Nevertheless, you can see the amazing bone structure. It is easy to imagine what it once was.

In Cuba, the geography and the architecture are amazing. However, money hasn't been spent on the upkeep. Even though people live there, it seems surreal (almost like a post-apocalyptic wasteland).

 

 

In the story of Exodus, the Jews spent 40 years wandering the desert after escaping from Egypt. That means two generations of people, who didn't remember life as slaves, were ultimately the ones who entered the “Promised Land”.

On some level, that's how Cuba is now. Most inhabitants weren’t born (or can’t remember) the 1960s. They have known nothing but this.

Cuba is an interesting place … and I’d bet that it has an interesting future.

The “lack” had a side effect. It produced a mutation. A portion of society grew more resourceful and resilient.

 

 

Like natural selection … nature finds a way.

The rules change, the players change, even the game itself changes ... That is how new ideas and new leaders emerge.

Sometimes, almost no one notices. Sometimes they do. 

Ultimately, change remains the only constant.

Onwards!