Financial & Economic Blog

The WSJ reports tonight that the NYSE is going to close two of the remaining four more rooms by November 1st. The Blue Room and the Extended Blue Room (or EBR on the Floor) are closing leaving just the Main Room and the Garage. The NYSE has already closed the New Room.

"The moves reflect the pressure on the NYSE's stock-trading business following the industry's shift to electronic trading and the emergence of competitors touting advantages like faster execution or greater anonymity."

I was on the Floor last month, and was shocked on how empty it was. The normal buzz on the Floor was non-existant, and there was a ton of empty space. The downsizing by the Specialist firms, $2 Brokers, and member firms is obvious. The guys I know down there say the Floor is down 60% of the people. I think they were low on their estimate.

Why trade on the Floor when the NYSE themselves gives a rebate of 25 cents per 100 shares of posted liquidity that trades on the NYSE ARCA platform?

DUBLIN, Ireland, September 13, 2007 - As part of a continued effort to help build a collaborative and adaptive channel to accelerate customer and partner success, Cisco® today introduced the Cisco Industry Solutions Partner Network. The new Industry Solutions Partner Network will engage, enable and reward a global community of channel partners, application providers and device manufacturers to collaborate and deliver industry-specific solutions that address the business needs ...

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A short post today -- based on a couple of my recent interactions with/on YouTube.

We just published a research report, Uploading To Video Portals Isn't Easy, that looked at the usability of five video portals (thanks to Ross Popoff-Walker who did most of the work). It turns out that YouTube's usability was pretty good. Here's a summary of the report:

Forrester applied an abridged version of its Web Site Review methodology to the site experiences at five major video portal sites: YouTube, Yahoo! Video, Metacafe, Dailymotion, and Veoh. Our evaluation looked at how well each site supports young adults trying to upload a new video clip. Only YouTube received a passing overall score. Some of the major problems we found across the sites: poor contextual help and deficient privacy information.

I also just found out that someone posted an excerpt of my speech from Forrester's Finance Forum on YouTube. It was probably done by Forrester's marketing department; hoping that the video would generate the same buzz on YouTube as coke + menthos or the dancing cadet. :-)

Well, I can assure you that my video is not nearly as exciting as the running Russian video. But if you want to see a portion of my keynote speech on Experience-Based Differentiation, then here it is.

Unfortunately, you only see me -- and can't see any of the slides. Maybe someone in the audience who was illegally taping the event will post a video that shows the slides as well. You never know.

The bottom line: YouTube makes it easy to upload anything.

We at L9 have debated for quite some time about adding a blog to our site and decided to go ahead and give it a try.

There are a zillion blogs out there already covering every imaginable subject especially both in the private and business spheres. It's hard to find a topic that hasn't been covered from all sorts of angles. What we found also, that there are in fact not that many blogs that deal with financial services and this is where we want to fill something of a void. We do not intend to cover the industry from a ground floor level but rather take the 10,000 feet view. We want to deal with the big picture. Add commentary on web developments on the web that will impact your business and ours. We hope to bring a fresh new perspective to the conversation and welcome your comments both positive and less so. Welcome!

Sir Alexander Belloc-Brayne takes the waters in Baden-Baden and reflects on the state of the global economy and international relations.

Readers who feel the need to respond are invited to scroll to the bottom of the page and attack the Comments button.

August 2007

Summer is i-cumin’ in… Be that as it may, the Belloc-Brayne household is i-goin’ out… to take the waters at Baden-Baden. Lhude sing cuccu, you may think, considering the aqueous nature of our English summer this year. However, Lady Belloc-Brayne insists that there is a qualitative difference between the water that descends from the skies and the sort that bubbles up from the earth. There's no arguing with that.

I must say that there is no sign of financial and natural disasters out here in Baden-Baden. Not exactly the eye of the storm, but Lady Belloc-Brayne says that the town has been spared on account of a visitation by the eleventh plague last year, in the guise of the England World Cup Association Football squad and its camp followers. Something in my water says that Her Ladyship is eyeing a permanent move to this particular corner of some foreign field where the Poor are not inevitably with us - no matter what it says in the Gospels. I am mentally rehearsing the case for our British domicile, which currently rests on the cost of putting our four-bedroom home on the market. However, Her Ladyship seems to be ahead of the game and is already talking in terms of our “two-bedroom-two-study” residence, which could well evolve into “student accommodation” if our Government goes all the way with the Home Inspection Pack.

Lady Belloc-Brayne and Nurse are dividing their time between the "Russian Quarter" that seems to have sprung up on the higher reaches of the Baden-Baden property market, and regular expeditions to the shopping precinct, with Sir Alexander in the traditional role of Paymaster General. Nurse is much taken by the local designer jewellery, known colloquially as schmuck – presumably after the fellows who buy it for their wives and mistresses. As a man of finance, I am taking a professional interest in the biometric credit card used in these parts, which relieves the elderly shopper in particular of the burden of recalling a PIN. Vorsprung durch Technik... Unfortunately, one needs to remember the finger that one has registered, which does occasionally create congestion at the tills. I have seen the future...

By the way and lest we forget, I can recommend a rather good local wine marketed under the Fatima label – which turns out to refer to the Christian name of a Frau Wimmer rather than to the daughter of the Prophet. Nevertheless, I am inclined to report my initial suspicions to the intelligence services lest the enterprise turn out to be a front for an Iranian-backed Shia cell (Badr-Meinhof, perhaps? Ha, ha!). I suppose that I am obliged to alert the Financial Services Authority too, under the letter of our money-laundering legislation. Anyway, well spotted, Belloc-Brayne! A “tied agency” at MI6 is surely yours for the asking. Our man in Baden!

Good to see the FTSE recovering bravely in our absence. I do declare that I am rather proud of our Bank of England for keeping its head while American and European central bankers engage in an undignified display of dove-eat-hawk monetary policy. Most impressed by our new Chancellor’s sphinx-like resolve to abide by the spirit of central bank independence. "Silence is as full of potential wisdom… as the unhewn marble of great sculpture", saith Her Ladyship (after Huxley) – or, the way I see it, whereof one knows sweet sod-all, one must pass over in silence (after Wittgenstein).

We are all naturally saddened by the human casualties of the financial upheavals – notably Edward Cahill of Barclays Capital, who has fallen on his sword after the brutal junking of at least three of his SIV-lite funds by the debt-rating agencies, and Martin “Mr Sub-Prime” Finegold, who has lost his Midas touch and fallen on his arse instead. Her Ladyship suggests that I circulate a petition in support of Blackstone’s opposition to the Baucus-Grassley Bill that would have publicly-traded asset management and investment advisory services taxed as corporations, and which would have lopped $525m from its modest $2.27bn net income in 2006. Incidentally, word is that some pension fund trustees and private investors may sue the hedge funds for issuing misleading prospectuses and for general mis-selling – presumably on the grounds that they were never told that their investments could fall in value. Where is the Financial Services Authority when you need it?

Lady Belloc-Brayne is cheered by the generosity of Goldman Sachs and Barclays Capital, which have splashed out $3bn and £800m to shore up their aptly named Global Opportunities and Cairns High Grade funds respectively. I am, however, having difficulty getting Her Ladyship to accept the institutional logic of not extending the precedent to Prodigal Life mutual funds. As for Nurse’s concerns about her self-invested personal pension, I have been able to reassure her that, as an unfunded retirement benefit scheme (UFURBS), it is quite intact. Strictly entre nous, though, I am at a loss to understand why securitised loans should be known as Collateralised Debt Obligations, when the absence of collateral seems to lie at the root of the problem. Her Ladyship suggests that the “damage” is silent. That must be it!

I must say that folk in this neck of the Schwarzwald are remarkably calm about the European Constitution and seem genuinely nonplussed as to why we Britons should object to rule from Berlin via Brussels. The way I see it, the Reform Treaty is not so much a constitution as a reconstituted Schlieffen Plan - which did not require a referendum either, if I recall. Meanwhile, the locals are celebrating the news that Bundeskanzlerin Angela Merkel has topped the Forbes List of the world’s most powerful women for the second consecutive year, ahead of Chinese Vice President Wu Yi, Tamasek Holdings CEO Ho Ching, Condoleezza Rice, Pepsico CEO Indra K. Nooyi, Indian Congress Party President Sonia Ghandi and countless other distinguished harridans. Word is that Frau Merkel is currently in China promoting liberty, intellectual property rights, environmental conservation, flexible exchange rates and other ideas to which the Chinese Government is famously receptive.

I notice that there is quite a hoo-hah about the quality of our imports from the Middle Kingdom – no doubt an oblique attempt to erode its impressive trade surplus and divert attention from its pre-eminence in creative recycling, as manifested in such innovations as diethylene-glycol-enhanced toothpaste, eels raised on contraceptives and soy sauce made from fermented human hair. Yum, yum! Meanwhile, Her Ladyship tours the stores in search of the detergentless WasH20 launderer, which works by passing an electric current through the water– a technology that has no doubt has been tested on dissidents by the Chinese equivalent of our Health and Safety Executive.

Rather alarmed by a looming stand-off around the North Pole between the Americans, Canadians, Russians and Norwegians over oil deposits rendered exploitable by global warming. Can’t think why the Russians should lionise the Mir-1 crew just for planting a titanium-alloy flagpole on the Arctic seabed. Hardly Everest, is it! Word is that the Bolsheviks are beefing up their armed forces and conducting joint military exercises with the Chinese People's Liberation Army – equally pointless, the way I see it, given that any conflict is more likely to erupt in the commodities and capital markets. Mind you, I fancy the Russians to hold a natural comparative advantage in the oil-extraction business, given their vast experience of labour relations in the Arctic Circle. We might have to send in our troops after all – perhaps on the pretext of bringing democracy to the polar bears and the ringed seals.

Must rush. Nurse has rediscovered her joie de vivre on hearing that our Baden-Baden visit coincides with Grosse Woche at the Iffezheimer race course, where one can easily find oneself rubbing shoulders with an Arab sheikh, a Russian oligarch or a hedge fund manager on the lookout for a safer investment.

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I'm on my way to the Office 2.0 conference in San Francisco. I'm particularly interesting to see what new cutting edge technologies, solutions, and ideas are discussed over the next couple of days. Also, I'm keen to see how this applies to Financial Services. I'll be posting during the show, so stay tuned.

How do you know when you've crossed the invisible line and you're not young anymore? Maybe it's the first time you look at Billboard's top 20 list and don't recognize a single name. Or when your kids start staying out later at night than you can keep your eyes open.

BELGRADE - NOVI SAD, Serbia, September 6, 2007 - Cisco® today announced that Erste Bank Serbia has implemented Cisco's Financial Services Intelligent Network Solution and deployed a new unified voice, data and video network, including 850 Internet Protocol (IP) phones, that will help accelerate the bank's growth by connecting all of its 62 branch offices in Serbia. Financial services make up one of the fastest-growing business sectors in Central and Eastern Europe. Increasing ...

Here are 7 stocks from Fortune's Fastest-Growing Companies list, plus 3 mutual funds, likely to rise steadily and reliably even in today's turbulent markets.