31st
Power of emergence. (via Mick Mountz: The hidden world of box-packing | Video on TED.com)
7 – #REVOLUTION | THE NEXT BILLION SECONDS
ht @petervan
cc @PeerIndex Reputation Enhanced Lending and Trading Becomes Mainstream by Assistant Vice President, Strategy Tim Morey
The recession, coupled with the rise of the so-called Collaborative Consumption or Shared Economy, has the early–adopter community abuzz with notions of the end of consumption. Companies like AirBnB and Zimride that allow people to open their homes or their cars to share or loan for a fee are cited as examples of new ways of using and exchanging goods and services. But the really interesting trend here is that new forms of trust are being enabled by social networking technology. We all joined Facebook and LinkedIn to stay in touch with colleagues and friends, but the upshot of mass adoption is that we can check up on virtually everyone we come across. Individuals who have never met or transacted with one another are using social networks to validate each other. If you are just selling goods on Craigslist, it doesn’t really matter whether the buyer is a good person or a bad one: I take the cash, you take my goods, and you are gone. But if I am renting something to you, trust becomes critical. I want to know that you are not a crook, or a thief, or a bad egg. By linking person-to-person transactions to social networks, we are reducing the need for cash deposits and other financial remedies to the bad egg problem. While logging into third party websites using your Facebook identity is now commonplace, we are beginning to see person-to-person exchanges making use of social networks to broker trust. For example, before you stay at someone’s spare bedroom via AirBnB, you have to sign in with your profile. I recently rented someone’s house in Toronto for a few days, and between our respective social networks we found enough friends, relatives, and colleagues in common for him to lend me the property with confidence. In 2012, this reputation enhanced lending and trading will become mainstream. We will lease, barter, and trade with relative strangers, banking on their reputation and connections.
The Age of the Algorithm
by Senior Principal Design Technologist Jared Ficklin
We live in the App Age and are entering new territory. The sexy math behind voice or facial recognition, real time translation, or even just assembly of a playlist of music, is no longer the realm of super computers or even desktops. Smart phones will run algorithms, and the data to feed them will also be more fluidly available. Forget Global Warming models: Consumers will pay good money for an algorithm that gathers data and solves everyday problems.
While other financial and insurance companies flirted with collapse, USAA’s net worth grew from $14.6 billion in 2008 to $19.3 billion in 2011. And it has continued lending money while other banks have tightened their loan operations despite billions in government funding to encourage liquidity. It has a free checking account, has been at the forefront of electronic banking, and reimburses up to $15 in other banks’ ATM fees. Its credit rates are 43 percent lower than the national average.
The firm’s structure is one of its most interesting attributes. Unlike nearly every other Fortune 500 company, USAA is not a corporation. It is an inter-insurance exchange made up of the people who have taken out policies with the firm. As a group, they are insured by each other and simultaneously own the company’s assets. Instead of paying stockholders, USAA distributes its profits to its members. In 2010, it distributed $1.3 billion.
Face value: Digitally aged pictures cause people to save more for retirement If you have trouble conceiving of the financial needs of your older self, you’re not alone. Studies show that the part of the brain that lights up when people think about themselves in retirement is the same one that is activated when they think about a stranger. To bridge the gap, a team of researchers at Northwestern University, led by Hal Ersner-Hershfield, have developed digital imaging techniques that show prospective savers what they will look like at retirement age. Seeing themselves years later significantly increased their willingness to commit more money to retirement savings, as did changing the image so that the face was smiling. Insurance and wealth management giant Allianz is now developing a scaled-down version of the technique for its financial advisers to use. (via An investor’s worst enemy? Their brain - The Globe and Mail)