The Future That is on Its Way to You!

We should be preparing for a set of major macro trends, Bernard Marr has written, after a discussion with Scott Smith of Changeist. Some of the trends already pre-dated the Covid-19 pandemic, but have been accelerated by it, and both men warn that these trends are ones we should not ignore.

Decoupled economies

According to Marr and Smith, the ‘decoupling’ of economies has been happening for around a decade. The result is a turn to nationalism in some of the world’s biggest economies, such as the USA, the UK, Brazil, Russia and India. As they say, ‘globalization is in the rearview mirror’ now, and we can expect a ‘multipolar world’ where three or four large regions with their own “distinct economies, security networks, cultures, and laws.”

Social change

Education, transportation, energy, food, and healthcare are in the midst of massive changes, much of it spurred on by the recognition that climate change is not a hoax. We are seeing a swell in the numbers of vegans and vegetarians due to livestock production accounting for 14.5% of greenhouse gases. There is also a transition to cleaner transport, and in the energy sector there is a move to meet the emissions reduction targets agreed to as part of the Paris Agreement on climate change. Covid-19 has also produced a transition to more working from home, and we are still grappling with this sudden change in our work life.

A new social contract?

The traditional social contract between citizens and government is no longer working for a significant number of individuals. Marr writes, “Societies have become divided between the haves and have nots, and any differences, whether religion, race, or sexual orientation, create chasms rather than common ground in the echo chamber of social media.” Automation threatens some workers, while the idea of a universal basic income has become a much hotter topic, as will debates about the nature of the future social contract between people, businesses and governments.

An AI reset

Currently we are seeing what is called an ‘AI reset’. The technology presents challenges that need to be carefully considered now, such as the regulatory obstacles and cost of development. On the other hand AI is accelerating and Smith believes another big wave is on the way.

Who are you?

Our personal identity would seem to be solid, yet thanks to digital technology it is varied and complex. Marr writes, “Today we have the ability to represent ourselves as a “stack” of identities that account for various affiliations, situations, values, and more.” Virtual and augmented reality has added to this ‘stacking’. As Marr says, “Given the tools at our disposal, smartphones, social media, and technology, we are free to create a digital narrative about who we are that might not match our physical world persona.”

Finally, we are facing life in a “blend of the physical, biological, and digital worlds.” The ‘new normal’ will be a combination of the physical and digital, and “Every organization must now consider how they provide products and services equally as well and complementary, whether interacting online or in the physical world.”

Some will welcome these trends, while others will be less enthusiastic. Whatever your view, it’s not difficult to see that regardless of opinion, this is our direction of travel.

Investing in Stock Exchanges: a novel idea

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The world of investing centres on investing in stocks. However, Jon Markman writing at Forbes offers up a new idea: investing in stock exchanges. How does that work, you may ask. Markman points to the Intercontinental Exchange (ICE), an operator of commodity and stock exchange, which posted exemplary financial results on 1st August and suggests that as its managers plan to disrupt lucrative markets, such as the new digital ones, it is worth looking at it as a potential investment.

ICE “builds, operates and advances global markets through information, technology and expertise,” according to its website. It’s a relatively new set-up that was only founded in 2000. In 1996, Jeffrey Sprecher, a mechanical engineer from Wisconsin, bought Continental Power Exchange, an Atlanta electronic energy trading company for $1,000. He saw an opportunity to take advantage of a move to electronic trading.

The company launched as ICE in 2000 when Sprecher gave up 80% of the business to investment bankers Goldman Sachs and Morgan Stanley, according. It immediately became a competitor to Enron, one of the biggest electronic trading platforms at the time. However, it wasn’t long before the Enron scandal broke and in a very short time ICE became the market leader.

Sprecher had no experience in financial markets, nor had he ever traded stocks and shares, but he “could see how slow, traditional financial markets were about to be disrupted by fast, low-latency software platforms,” Markman says. Sprecher recounted the story of how flying back from London he spotted a story in the Financial Time about credit default swaps (CDS), and while he had no clue about what they were, he intuited that there might be an opportunity for ICE to leverage its platform to build an electronic marketplace. Today,  ICE currently clears 96% of all CDS.

He also used his creative thinking to engineer the $8.2 billion buyout of the New York Stock Exchange in 2012. In a little over a decade, this small Atlanta company went from obscurity to being in the vanguard of financial markets.  Today ICE currently operates 12 regulated exchanges and six clearing houses. The company logged $6.3 billion in revenue in 2018.

Its success is down to a great strategy based on seeing the transformation of financial markets early on. It has continued to make interesting strategic acquisitions, including the Chicago Stock Exchange last year, and as Markman says, “Getting ahead of the digital transformation of the $11 trillion mortgage market is another multibillion-dollar opportunity for ICE.”

Furthermore, as it is based in regulated financial markets, the company is the logical intermediary for this emergent digital ecosystem. It appears ot be firing on all cylinders, and as Markman says, “Growth investors should consider using broad-market weakness to accumulate shares.”

 

Twitter comes under fire from McAfee

John McAfee, the bitcoin buccaneer, has grabbed the headlines again this week, but this time it is in a good cause rather than a self-serving one.

Earlier this week Ryan Smith at CCN revealed that a scammer was impersonating John McAfee on Medium. He wrote, “The so-called “McAfee Crypto Extravaganza” promises mouth-watering 10x returns — if and only if — you deposit a small amount of Bitcoin or Ethereum in the attacker’s wallet first.”

CCN alerted McAfee’s wife Janice to the scam and she posted on Twitter that it was a fraud. It was clear that the scammer had gone to some lengths to create two cleverly crafted phishing sites and the fraudulent pages even go so far as to fake Bitcoin transactions and mimic BTC block explorers.

It wasn’t long before John McAfee stepped up to add his view of the situation, and he took aim at Twitter for what he sees as its lax approach to bitcoin scams.

McAfee told CCN: “This happens three or four times a day where people pretending to be me on various platforms, attempt to scam people using a variety of scams. On my Twitter account everyone of my tweets are peppered with comments from people pretending to be me and attempting to get people to send Bitcoin or Ethereum in exchange for a larger amount. I no longer bother to report them to Twitter because I never get a response.”

You can understand his anger and frustration. As Ryan Smith commented, “Twitter has the paradoxical reputation of being both incredibly resourceful and annoyingly frustrating. Influencers find it increasingly difficult to wade through the information swamp only to interact with their genuine followers.”

And as CCN reveals, scammers will even use Pope Francis for an “Official BTC Giveaway”. Although, if anyone believes the Pope is giving away bitcoin, perhaps they also think that the moon is made of green cheese.

Over a year ago, Jack Dorsey, a big bitcoin supporter and one of the co-founders of Twitter, promised he’d take action to reduce the problem. But as CCN says, the problem seems to have got even worse. CNBC Crypto Trader host Ran Neuner recently challenged Jack Dorsey to stop wasting resources on a new user interface and do something to stop the exploitation of novice crypto users on Twitter.

Twitter may still be the leader in short form content, as Ryan Smith points out, but should another platform emerge that is scam-free, then Twitter may find its sizable community of crypto followers deserting it for a safer harbour.

Chinese workers are right to protest ‘996’ work culture

Perhaps you are wondering what is the significance of ‘996’? I was initially puzzled myself. Then I learnt that in China it refers to the hours and days of work demanded of employees by the big tech companies” 9am to 9pm, six days per week. That’s 72 hours of work per week. The employees have no time for a life.

As James Stanier asks in his OneZero article: “Is this the price it takes to get ahead in the booming Chinese economy, or is this a symptom of a hustle culture that has gotten way out of hand?”

Jack Ma is in favour of 996

Stanier presents an excellent example of the mindset behind ‘996’ in the shape of Jack Ma, the co-founder of Alibaba. This one of the world’s largest online retail companies. Ma, who is worth billions, has got himself into hot water with workers following his comments on WeChat (a Chinese social media channel) about 996 culture.

Some of you may be stunned by Ma’s comments: “Many companies and many people don’t have the opportunity to work 996. If you don’t work 996 when you are young, when can you ever work 996? In this world, everyone wants success, wants a nice life, wants to be respected. Let me ask everyone, if you don’t put out more time and energy than others, how can you achieve the success you want?”

No doubt Marx and Engels and a few others would have had a suitable answer for him. But Ma isn’t alone in supporting this approach. Stanier has uncovered emails from other Chinese companies, such as JD.com and Youzan that show management’s preference for working employees to the limit. One email from JD.com stated, “underperforming employees are those who don’t keep “fighting” to do more work “regardless of performance, position, tenure, personal well-being issues or family reasons.” And at a Youzan company event, the management demanded that employees follow a 996 routine.

Workers protest online

However, it seems that workers are not blindly accepting this regime. A website called 996.ICU, hosted by Github. The site’s name refers to “work by 996, sick in Intensive Care Unit,” which sums up the burnout and ill health workers suffer by working a 72-hour week.

The website highlights the fact that Chinese labour laws prohibit more than eight hours of work per day and 44 hours per week in a standard contract. Anyone working more hours should be paid overtime. It has a list of Chinese companies using the 996 practice, including controversial Huawei.

In the West we take the right to strike or protest as a given. But in China things are not so supportive of workers. It seems that the conversations online about 996 are being censored and blocked by the big tech companies: try to access 996.ICU via Tencent’s QQ browser and a pop-up message will tell you it is a “malicious site.”

Don’t let 996 become a global practice

It is somewhat understandable that China’s tech companies adopted the 996 regime in order to have first advantage in the global market. Some of them have been so successful that newer companies follow their strategy, believing that is the sure route to success. But as Stanier describes it, “It utilizes sheer brute force to beat the competition and capture a market.” And, while these punishing hours may work with repetitive tasks, how can designers and programmers maintain a high level of quality work under such pressure. To my mind, this is a form of modern slavery that will eventually damage China’s tech companies and perhaps foment a greater rebellion than protests on the Internet.

And we must watch out for it moving to the West. There are those in Silicon Valley who admire Jack Ma and have voiced an opinion that 996 is, “the same work ethic that built America.” We must maintain our sanity, and focus on strategy and efficiency rather than imposing insane working hours on employees. As the saying goes, you can’t flog a dead horse, and that is what tech companies are heading towards by treating their workers like machinery.