Faster Payments – Will tech eat the banks?

pexels-photo-870902
Checks and Pony Express

At last the big, big tech companies are driving the US Federal Reserve to sponsor and get behind a faster payments initiative.

Amazon, Apple, Google, PayPal, Square, Stripe and Intuit, have all co-signed a letter supporting the the Fed being in charge of the development of a system that can connect all the banks and credit unions in the U.S. to speed up payments. I’ve long complained here that the US System is laughably out of date, and the system Automated Clearing House and its associated network is still loosely based on the delivery times of the Pony Express and definately around checks.

The ACH itself still describes itself as a using batch processing and a store-and-forward system. And that’s exactly the problem, the store-and-forward part and the regional centers deployed to support it are largely based on the old Pony Express delivery model. The ACH and it’s partners have pivoted since the push by the tech giants, to lauding their fraud and safety. Largely the only reason they can is because of the huge inefficiency and delays built into their system, rather that the inherent security qualities they’ve developed.

While a fast payments network should not be implemented over the public Internet, it’s simply both unbelievable, and unacceptable that my bank cannot not directly send money from my account to your account. This isn’t about Bitcoin and similar nonsense, it does require databases that have the attributes of a Blockchain, but it doesn’t require a Blockchain. This isn’t spin to invest in some imaginary new technology, it is merely a plea to move to a modern switching network, with updated apps.

I don’t transfer money around in Europe or the UK anymore, maybe once a year or so. However, I’ve been able to use the UK Fast Payments network via my UK Bank, FirstDirect, to instantly pay other banks/accounts in the UK, as well as transfer money from UK Pounds Sterling to Euro’s in a German bank in less than 2-hours, all at not cost to me, and using a single system, rather than a secondary system, branded app, or external service. Faster Payments isn’t just a year or two ahead of the US, it’s currently celebrating its 10th Anniversary, and will likely be on its 15th before the US has anything.

That’s mostly why services like PayPal, Stripe, Square, PopMoney exist. To allow the banks and credit unions offer a service they themselves can’t offer. Also, when originally launched it was a way of charging extra for a service that was faster and more flexible than their ACH system offered. Any institution currently charging for these services is charging for lipstick on a big now.

pronto

I first came to the USA in 1983 to work on the server-side of worlds first home banking system, Pronto, at Chemical Bank in New York; in 1987, I was hired by IBM UK in their London Banking Branch, to help London banks like Lloyds Bank, NatWest and TSB, as well as Abbey National, prepare their systems to start Year 2000 (Y2K) testing.

Finally, in 1998, was the Chief Architect for IBM in their NatWest (Business) Online implementation. The first at-scale version of Internet banking at National Westminster Bank, after failed projects by Sun Microsystems and Microsoft.

nwol

I have some idea of the complexity of updating and integrating batch, hub and spoke systems, it’s no cheap or easy. While it’s easy to assert the banks don’t want to change because as everyone believes, “they are making money out of the delays”. They are really not, in any meaningful way. What they are doing is simply avoiding making key investments and dressing it up under the guise of safety and security. Now they are blaming the “lack of a mandate“.

as everyone believes, “they are making money out of the delays”

And that’s what is likely to be their undoing. They’ll continue to push back and resist, until so much of their business has shifted to non-core systems. While the likes of Amazon and Google have to be in the ACH, and have Fed backing and security, they can increasingly provide a home run around the traditional banks.

Earth, Wind and Fire; life and guidance

foto_20190111_100904Over the year-end I read the Maurice White, Herb Powell penned autobiography, “My Life With Earth, Wind & Fire”. It was both an interesting read, and revelatory.

While my early teens were heavily influenced by David Bowie, my late teens and in some respects the rest of my life was heavily influenced by the sound, and especially the mystical guidance that seemed to be coming from the group, led by it’s founder and bandleader, Maurice White.

White’s spiritual approach gave endorsement to my own uncomfortableness with my Christian upbringing and doubt that a single “God” existed. I never met White, but in the way you idolize someone, I thought I knew him through his music. I didn’t at all.

The book itself covers all the key phases of his life, and especially the struggles and troubles he wanted people to know about. His youth in Memphis was shocking. Yes, I guessed it wouldn’t be good, as a black kid in Memphis in the 40’s and early 50’s but it was worse than a white kid from England born in the 50’s could imagine. In many ways, I assume the events described, meant that Maurice spent much of his life searching for meaning, and examining ways to find context for what had happened to him.

As well as his long path through music until he hit success with Earth, Wind & Fire, the books chronicles Whites, obvious to me, struggles with commitment and identity. We all need stories in our lives to make sense of them, to understand  why you are, who you are, and the book covers Whites journey to understand his stories. Notwithstanding all that Whites’ story really had some great commentary and lessons on surviving in the music business.

Rocks Back Pages has a revealing and frank interview with Maurice, by Cliff White, from I assume London during the 1979 tour, which I attended. RBP also has a list of articles which contains some useful background.

Surprisingly, NAMM, the National Association of Music Merchants (NAMM), doesn’t seem to have an interview with Maurice, but it does have interviews with Verdine White, Ralph Johnson, and Larry Dunn, all of which are really interesting and add great context.

ewf tatooI came to Earth, Wind & Fire in 1974, via Ramsey Lewis Sun Goddess album in 1974 and then their Open Our Eyes album, and shortly afterwards, That’s The Way of the World.

It wasn’t until a couple of years later that I saw them live, but in the “long, hot” UK Summer of ’76, I stopped one afternoon in Dunstable to get a drink. We’d been out at the disused quarry on the A5, practising motocross. I was riding my Honda XL125.

Nextdoor to the corner store/newsagents I’d stopped at, was a tattoo parlour. Back in the 70’s tattoos were not the fashion items they are today, my dad had a traditional, simple knife and heart tattoo on his left arm, but few people I knew did. I walked in, hand drew the logo that I’d seen on EWF albums, and asked for a tattoo. Not only had the tattoo artist not seen the shape/sign before, I had no idea what it was.

These days of course, with the pervasive internet, you’d just google and look up tattoos on pinterest and see what you can find. Of course these days I know it’s the astrological sign for Jupiter.

Like many, my interest in EWF faded in the Mid 80’s as the group fragmented, and the focus drifted. As I work to digitize my entire vinyl collection though, I’ve once again found their tight music, soaring vocals, and inspiring lyrics a great launching point for many parts of my own story, which started on the 23rd night of September. Kalimba.

“Socialism” vs. “capitalism”: what left and right get wrong about the debate

This is a great read, and completely on the “money”.

I grew up in “social” aka council housing or, as they call in America, the “projects”. I’ve worked in Moscow, East Berlin, Romania and China; I’ve been to all the countries in the Middle East with the exception of Libya; Israel twice, none of them have socialism but I’d rather not live there. The UK even with added “free” Healthcare, a Labor government, at it’s most extreme, the UK never had socialism.

Any discussion of Healthcare or public “welfare” in the USA descends into an argument about socialism within 90-seconds. It almost carries a worse stigma than Nazi Germany.

I can only think it comes from an era, when people were more easily brainwashed by propaganda, unlike now when propaganda comes from social media in the form of bias/prejudice sponsored intelligence attacks.

I assume, since i don’t know, that there a heavy sell to support anti-communism from the 20’s through McCarthy, and through the Soviet era to the destruction of the Berlin wall. You can see the same imagery in any of the ridiculous tea party supporting websites.

My favorite is this Regan poster. I’m not sure what we won, but having been in Russia both before, during and after the 1991 Soviet coup d’état , they’ve made huge changes, huge gains,and Russia doesn’t have the same scale hunger, desolation it had when it was the center of the Soviet Union, it now has arguably as many or more billionaires than America does.

We, with our self prescribed image of rugged individualism, innovation, and capitalist world leadership, on the other hand just have even greater wealth disparity, a completely fscked up Healthcare system, and a collapsing democracy manipulated by the very side that espoused Reagan.

The false dichotomy article linked below encapsulates so much of what we need here, now. I speak as someone who can afford not to work, who is in the 5% but knows America can and must do better.

https://www.vox.com/the-big-idea/2018/8/16/17698602/socialism-capitalism-false-dichotomy-kevin-williamson-column-republican-ocasio-cortez

America and Syria – the backstory

President Trump has decided, unilaterally apparently, to pull all America troops out of Syria, both surprising his Chiefs of Staff and allies.

The American story with Syria is intertwined with almost everything the west has done in the Middle East since the end of the 2nd World War.  American was the prime enabler of the Assad family rise to to power, and as everything post war seemed to be, all about fighting the rise of Communism and installing “democracy”.

Syria gained its independence in 1946 and in 1948 engaged in the Arab-Israeli war. Later in 1949, the Americans were party, or if you believe many, responsible via the emergent CIA, for the coup d’état that replaced the Syrian democracy with Husni al-Za’im, who was executed later the same year.

The Syrian story since the 2nd World War is complicated, wars, Hamas, Iran, Hezbollah. Assad senior played key roles in much of the 1980’s terrorism, before the US and especially the UK decided that their actual target in the Middle East was Gaddafi, and that they needed Assad’s Syria as an ally their upcoming war.

So, you can be surprised by President Trump’s actions, you can blame it on his trying to appease Russian leader Putin, or you can just believe that this is yet another of President Trump’s rollbacks of President Obama’s actions. Whatever you do though, don’t think American involvement in Syria is just about the defeat of ISIS.

serveimageA great read is Wilfords 2013 America’s Great Game. You can purchase the book from Amazon, you can read a book review on the Boston Globe, or this review, “Playing Both Sides” on the New York Times. better still, you can watch/listen to Wilford, here on C-Span.

Missing the point of Healthcare costs

We managed to get Health Insurance sorted out for my wife and daughter, without falling into the trap of me getting covered by an ACA policy, which would put me in jeopardy of violating the “public charge” agreement I accepted when applying for my green card. I’m self-insuring for another year aka uninsurance.

Today I took my daughter to the dentist, she needed two baby teeth pulled to make way for her adult teeth. The insurance didn’t verify when they put it in. So I paid by card. In a subsequent phone call we went through the process of how to claim the money back. The process involves mailing in an invoice, the insurer authorising it, contacting the dentist and having them re-submit for insurance payments, and then finally refunding us our payments.

Of course, I won’t pay for any of this back and forward. Insurance does. Insurance will pay the broker and admin who finally were able to spend a full hour helping us get the forms submitted without putting me in legal jeopardy.

The paediatric dentist will absorb the cost of trying to get the bill paid through insurance, then after discounting their charges for “cash”, taking a hit for payment by card, and then there is all the additional admin that the dentist and the insurer will have to put in. None of that is free, it’s all rolled into the cost of insurance. Repeat that thousands of times per day over a population of 300+ million…

Before this episode is finished, it will have cost more for the admin than the dental treatment. That’s madness. That’s just one small reason why we pay so much for medical insurance, and it’s invisible.

An Apple a day keeps the Doctor Employed.

apple drCNBC has an interesting article about the number, and quality of Doctors they employ.  I’ve no idea what’s going on an Apple, for a number of reasons, I’ve never bought a single product of theirs.

However, given their deep pockets and ability to play a strategically long-game, I for one would be surprised if this isn’t significantly more than just about the watch and apps that can diagnose conditions based on data in collects.

Here are my thoughts, in the form tweets to @charlesarthur original tweet and link to his daily Startup link list overflow.

 

Why we can’t have essential things

The meme

But this is much less funny. The drug companies have been conspiring to raise the prices for generic drugs.

albuterol, sold by generic manufacturers Mylan and Sun, jumped more than 3,400 percent, from 13 cents a tablet to more than $4.70.

https://www.washingtonpost.com/business/economy/investigation-of-generic-cartel-expands-to-300-drugs/2018/12/09/fb900e80-f708-11e8-863c-9e2f864d47e7_story.html?utm_term=.4ec5cbabdebd

What’s a #blockchain?

I posted the above to twitter, but its not really a joke. #blockchain has become the emperor’s new clothes and to some degree, @AARP is right.  The original article may be a little more aimed at humour than technical depth, but it’s not wrong.

A few of my friends have already been cold called and offering blockchain backed securities and similar. We know that’s mostly just marketing BS, but they don’t know. So this is, whatever you think, a good way to get them thinking about it.

For 90+ percent of the AARP readers these are good enough descriptions. The people who are AARP members who need to know about Bitcoin and Blockchain, already do and won’t be influenced by @brucehorovitz full article.

1535400878477-lost_and_foundIf you are really interested in the concept, and a non-tech example of #blockchain, Vice has one of the best examples I know of. It explains how, since 1995, how the theory of a blockchain and public ledger have been used in a non-technical solution. It covers and explains the use of a digital document store. The key to their store, was in fact to publish the unique hash for every document, and rather than use a technology solution as the public ledger, simply to publish the unique hash in the New York Times.

A more technical explanation is by Steve Wilson, on Constellation Research, called Blockchain Plain and Simple, covers the subject, and keeps on topic.

Remembering Terry Callier

Terry Callier
Terry Callier. Image by Johan Palmgren

Today is the 6th anniversary of the passing of Terry Callier.

I’ve been meaning to write this in time for the anniversary of his death for at least the past 3-years. After really enjoying his Hidden Conversations album [youtube playlist], I put it on my to-do list and here it is. I’ve tried not to just repeat all the other obituaries and rather make this more of a retrospective.

I don’t recall precisely when I became aware of Terry, sometime in the late 1990’s. Probably in some activity or performance around the 1998 release of his Timepeace album. My favorite Callier track, as I suspect many of his UK fan base was the eponymous Ordinary Joe, only bettered by the Nujabes 2005 album remix version.

Terry and his music reminded me why, and rekindled my love of soul music. His style, reminiscent in many ways of Gil-Scott Heron, lyrics often protest or love based. The ying/yang of soul music.

Callier, a Chicago native, he grew-up in the same Cabrini neighborhood as Major Lance, Jerry Butler, Ramsey Lewis and Curtis Mayfield also Charles Stepney, and via his early recording on Chess, house drummer Maurice White, who with Stepney went on to create the Earth, Wind and Fire sound and extravaganza. That area of Chicago was a petri dish for soul music. Callier though was largely undervalued and overlooked in the US. His style, his music, and his personality didn’t fit into a music business stereotype.

Part preacher, part activist, gentle soul, unassuming, and real Dad, Callier was renowned for making short term decisions based only on what was right. He effectively quit the music business in the mid-80’s to become a full time Dad and support his daughter who decided she wanted to stay in Chicago and attend high school there.

By the mid-90’s though, Callier got caught up in the whirlwind of being an American black musician is the UK. It’s something that happens to you, and for you, if you let it. Unlike the American music scene, where you still have to fit into a predetermined stereotype, and your music has to be classified within a narrow band, so it can be sold across a vast market. It Britain, your music has to be good, not exceptional, and YOU have to be adopted, and malleable enough to adapt to the your adopted market.

A great current example of this is Gregory Porter. He’s already Nationally famous in the UK, sells out the largest venues and can regularly be seen on TV. He is even front man for his own series on the BBC, Gregory Porters Popular Voices.

Callier was not just exceptionally authentic, after years of neglect by the US music industry, he was excited to absorb the admiration and inquisitive demand from the UK music industry, and especially the artists. Calliers music blossomed, not just his past work, but his future work. The story of how Acid Jazz founder Eddie Pillar contacted Callier and brought him back to music, is included in pretty much every write-up about Terry, including this obituary from his hometown paper, the Chicago Herald Tribune. In a Guardian article/interview by Tom Huron, following Calliers death in 2012, Pillar himself tells how this came about.

Hey, wassup? It’s Terry, Callier, I got a new way to flow for Ordinary Joe, you know!

and with those words, as he opened his return to music and introduction to the UK at a sold out 100 Club in London, 1991. In the years that followed via both label agreements, and through exposure getting absorbed into the emerging UK hip-hop scene. Over the coming years, Callier was involved in Giles Petersons UK label, Talkin’ Loud, stable-mate Urban Species; this low-res home recording of Callier and Urban species on the autonomous Later with Jools Holland, shows Terry in great form playing the soul man to the hip-hop

His work continued with Beth Orton, and not just samples, as is often suggested, but entire new tracks and collaborations, like “Bother to Brother” with Paul Weller, released on UK label Mr Bongo , the haunting Love Theme from Spartacus with north London duo Binns, Hardackers, Zero 7 who became a leader in the then emerging Chillout scene; and many more. It’s the collaborations with Massive Attack though that are the best for me, especially the music, lyrics and video for Live with Me.

Callier, like many others, including Alexander O’Neal have found the UK Soul, Jazz, Dance music scene much more compelling than the USA. It’s geographically smaller, much more diverse, less racially profiled and it’s had a successful business span of 50 plus years, and continues today.

It’s easier to perform live, you can get to most of it within day. Musicians and fans can stay home, or at the very least avoid flying to get to gigs. Word travels fast, and there is a national media who broadcast news and tv, that doesn’t require you to spend months on a tour bus in order to spread the word. Most of all the charts are not segregated. When you make #57, as Terry did with Love Theme from Spartacus, it was behind Madonna, Simply Red, RUN-D.M.C. and everyone else, not in a narrowly defined segment.

Calliers real impact can be measured by the fact that the BBC, and the major British broadsheets(the serious papers), The Guardian , The Independent all ran obituaries as well as the New York Times, Most remarkable though, perhaps, was the 2012 Terry Callier Tribute Concert at the Islington Assembly Halls. The youtube video, below, captures the beauty of Terry and his music. His original version of Love Theme to Spartacus.

I would rather be playing music, but what’s important isn’t always what you want, and what you want isn’t always what’s important. Isn’t that the truth?” – Terry Callier

Keep Terrys name alive!

Three to follow-up with:

Read: Jazzusa,com Interview with Terry – Terry Callier, Reluctant Musician

Hear: Massive Attack tribute Windmill Hill sessions.

See: Electronic Press Kit for Terry.

Terry Callier EPK from Alistair Batey on Vimeo.

Protect Colorado – Give me a break! (Yes on 112)

When we ride our bikes north and east of Boulder you can see the gas and oil pipelines an extraction points at regular intervals. But it’s nothing like Texas. Very, Very few oil derricks, certainly in and around Erie, CO there are a number of fracking pad sites, you can see them clearly from Colorado State Highway 52, in places.

But there is nothing like the density I expected given the prominence of the Oil and Gas industry in the state politics. Even when you drive out through north east Colorado, wells yes, but still surrounded by massive areas of open farmland.

So when you see TV ads and claims like this, you have to wonder.

from the Protect Colorado PAC web site.

“extreme out-of-state groups” > “thousands of jobs” > “devastate Colorado’s economy for years to come” – All pretty extreme. I wondered.

But I wonder no more. As always the great folks over at CPR News covered this is much detail, there are lots of in-depth articles on their website. I found the Colorado Wonders segment on the radio by Energy and Environment reporter Grace Hood and presented with Journalist and Presenter Ryan Warner.

You can hear them discuss it in full here. It’s the first 12-minutes or so. To save time, and as a form of notepad, here are my notes.

  • The two main political action committees involved are Protect Colorado(Oil and Gas PAC) and Colorado Rising(Environmental PAC) 
  • Protect Colorado is outspending Colorado Rising by 32-1.
  • Depending on how you look at the land affected it could put 85% off limits if Prop.112 passes, or it could put only 54% off limits due to increased setbacks.
  • The 85% number comes from looking at surface land available for well pads. Except, as anyone who has watched the fracking industry for the last 10-years knows. Drillers can now drill underground and then go horizontal for upto 3-miles. Yep, so your fracking site can be setback 2500 feet from schools, hospitals etc. but they can still drill upto 3-miles underground. Stunning.

So thats who is involved and some numbers to get you started More interesting though are the claims for the impact on the Colorado economy. Here again Grace and Ryan have you covered.

Oil and Gas Industry Impact in Colorado Overall

  • 2014, the peak of the oil and gas boom, Oil and Gas accounted for only 7% of Colorado’s Gross Domestic Product (GDP).
  • 2016, a low for oil and gas, Oil and Gas contributed just 3% of GDP.
  • 2018 looks to be about 5% of GDP, and is the average over 10-years.

This sort of contribution doesn’t even put the Oil and Gas Industries in the top-10 list in Colorado. So much for the devastating impact.

But I hear you say. Oil and Gas contributes so much more. What about taxes?

  • Severance taxes(what Oil and Gas pays) from 2012-2017 were between $4-million and $265-million. Sounds a lot, but is less than 1% of the State budget.
  • Compared to other States, like Alaska, where the severance taxes make up more than 50% of the State budget.

Why the variation and swing in both GDP and Taxes from Oil and Gas? Because it’s all dependant on the price of crude oil and gas. While the oil price has been slowly rising, it’s nowhere near the 2013 peak.

Grace Hood makes the point in her answers that the numbers don’t include oil and gas service workers and service industries. One of which would be the truck drivers who truck water out to fracking sites. Then there are the people directly employed by the Oil and Gas Industry, that must be big?

  • Employment State-wide is circa 29,000 or just 1% of the workforce in Colorado.

Who Wins?

The last note I took while listening to the CPR News item was the biggest impact would be felt in Weld County. You can take the link to find out a bit more about Weld County, but here are some notes I looked up from Wikipedia.

  • Weld County has an estimated population as of 2017 of 305,000.
  • Weld County is the richest agricultural county in the United States east of the Rocky Mountains, and the fourth richest overall nationally.
  • For a relatively rich county, the median family income is just $49,569. So the money is going where?
  • There are just 76 people per square mile in Weld County, compared to some 450 people per square mile in Boulder County and even more dense in urban areas and cities.

So while it’s easy to see that Weld County, if as populace as Boulder County, would suffer real financial hardship, given the population density and size of Weld County, it’s hard to image that the setbacks will be a real inhibitor there. Unless of course they are all out of sites and places to drill already. 

It’s easy to come to the conclusion that you should VOTE YES on Prop.112. I can’t vote as a non-citizen. The TV Commercials by “Protect Colorado” are pure unadulterated fear mongering. Sure, families and workers will be impacted if 112 pases, but hey, they’ll be impacted if the oil prices head south again. The boom and bust of the Oil Industry has been going on for decades, the setbacks won’t change that.

Protect Colorado doesn’t have a leg to stand-on with their extreme claims. I know most people who live near me would be horrified to find that a well pad 2-3 miles away was drilling underneath them. The setbacks are well deserved for safety in urban and more populous areas than Weld County and the like.