Tag: finance

No Financial System

As much as 50% of all unemployment monies, or $400b might have been stolen. Unemployment fraud is now offered as a service, much like ransomware. States without fraud-detection services are targeted the most.

This may be scare mongering by interested parties like the id “theft” cottage industry, but seems directionally correct. Terrible identity and financial infrastructure has consequences.

Alternative funding

If you have real revenue and real cash flow coming in, and you want to grow your business by pulling that revenue forward, don’t sell debt, or a WBS; don’t sell a claim on the black box of your entire business. Sell the smallest unit possible. Sell the thing itself: your revenue. And the purest way to represent that – the atomic, tradable unit of the subscription economy – is the revenue contract.

a possible alternative to debt or equity financing.

Citi $900m mistake

Last August, Citigroup Inc. wired $900M to some hedge funds by accident. Then it sent a note to the hedge funds saying, oops, sorry about that, please send us the money back. Some did. Others preferred to keep the money. Citi sued them. Yesterday Citi lost, and they got to keep the money. I read the opinion, expecting to learn about the New York legal doctrine of finders keepers—more technically, the “discharge-for-value defense”—and I was not disappointed. But I was also treated to a gothic horror story about software design. I had nightmares all night about checking the wrong boxes on the computer.

See, the “don’t actually send the money” box next to “PRINCIPAL” is checked, but that doesn’t do anything, you have to check 2 other boxes to make it not actually send the money.

ML bank interconnect

Stripe uses ML to improve transaction success rates by 10%

Over time, that model will learn in specificity, for a particular bank in middle America vis their UK-homed customers who have typed in lower cased zip codes, that the bank strongly prefers upper casing zip codes. So we just do that for them, for transactions across our network

Index fund confusion

Index providers should do case-by-case studies of stocks? Look, if you said to me that investors should do careful case-by-case analyses of the stocks they want to buy in order to make sure that their valuations were justified, I’d be like, sure, yeah, that sounds like investing all right. But if you told me that the indexes used by passive investors should do careful case-by-case studies of all the stocks they include in order to make sure that their valuations were justified, I’d be like, no, wait, that doesn’t sound like indexing at all. That is fundamental analysis; it is subjective and controversial; the whole business of stock markets is to adjudicate disputes over whether valuations are justified. The general idea of indexing is that you stay neutral in those disputes, and just buy stuff at whatever valuation the market gives to it.

Bank of the Underworld

“1000s of criminal websites relied on Liberty Reserve as their payment processor of choice. These websites predominated the sources of Liberty Reserve’s online traffic and generated billions of $ in transactions run through the company’s system.” Prosecutors dismissed the idea that many legitimate businesses used Liberty Reserve. After the takedown, users were encouraged to contact the US Attorney’s Office in Manhattan if they wanted their money back. Only 35 people did so.

Crypto is here to stay?

No matter what you think of this idea, it likely would boost the demand for Bitcoin and other crypto assets, as cryptocurrencies are potentially a way to store assets out of reach of many tax authorities. And the US is hardly the only nation that may be looking to a wealth tax in the future to balance the books. In essence, the new and higher price of Bitcoin is telling us that fiscal solvency will be hard to come by, and the wealthy will not give up their assets without a fight.