Serious Reading

I recently embarrassed myself hugely while reading Three Men in a Boat, Jerome K. Jerome's 1889 account of a trip up the Thames, on that other river of humanity, the Tube. I had the singular misfortune to stumble upon Herr Slossen Boschen's "comic song" during the morning commute, obliging me to hide my face in my hands until each laughing fit passed. A dozen times I tried to get it together, but a single glance at the stony faced commuters opposite was all it took to render me helpless. One should exercise caution while reading this novel at lectures, conferences, in court rooms and in the Houses of Parliament.

I've since ordered Idle Thoughts of an Idle Fellow, which I shall mostly be reading at home.

Improve Financial Capability - Simplify Products

The FSA says, "Financial Capability is about being able to manage money; keeping track of your finances; planning ahead; choosing financial products; and staying informed about financial matters."

The implication is that financial services don't have to change - you do. And the FSA provides a dazzling array of data to bamboozle you along the change curve.

This approach is doomed. Adult learning research has emphasised that the older you are, the less likely you are to learn. Of the 20-24 age group, 61% say they are learning now or have been recently. For the 55-64s, that statistic is 31%, and for the 65-74s, it is 18%. We have an ageing population and a ballooning pensions deficit.

So financial services must change, not you. Products must become simpler and cheaper, and it must be really easy for investors to develop fully diversified portfolios that produce sustainable returns.

Why can't I put suitable financial services in a shopping cart, like I can buy other stuff?

To make financial services simpler and more consumable for more people, providers and intermediaries must do much more to make it easy to find, compare, choose and buy products that contribute towards sustainable returns for the investor rather than scandalous profits for the provider. I'm not talking about the price comparison sites that simply list the same old stuff, by product type, by price. I'm talking about far more automated services that make the detail available to those who want it, but simply deliver diversification without the average person needing to understand more than the concept of not putting "all your eggs in one basket".

To support this, the clear objective of the financial regulatory regime should also be to deliver simple, low cost financial products that are accessible to us all. Currently, regulation funnels investment opportunities and funds into a zone in which relatively few firms are permitted to operate, enabling them to charge excessive fees and related compensation. In other words, regulation designed to protect the consumer is actually underwriting "fat banking". But what we need is a regime that fosters the growth of low cost 'facilitators' such as those who've allowed us to unbundle flights and hotels, music tracks and other one-size-fits-all products to create our own personalised, lower cost alternatives.

Training Tips

I spent much of the Christmas holidays digesting Joe Friel's The Triathlete's Training Bible, now in its third edition.

Having plodded my way through various multisport events since 2005 with only sporadic assistance from search engines, I've found myself at a bit of a performance plateau. So I figured I need to get more scientific if I'm to wring any more improvements out of my limited schedule. Although daunting in size, I've found Joe's bible has the right balance of science and practical tips to confidently tweak the training plan. He does a thorough job of explaining the latest research into physiology and diet, and recommending different workouts that contribute endurance, strength and/or speed depending on your needs (all of the above). Hell, just reading about training is a morale boost in itself.

Already I can report an increase in velocity, although times may have been wind-assisted by brussel sprouts.

The Great Aussie Firewall - The Game

The Guardian reports on the latest response to the Australian government's efforts to control the internet.

E-invoicing Integrated With SME Finance Platform

Alternative trade finance for small businesses is beginning to snowball - at least in the US. Early this month, the Receivables Exchange announced its integration with the Ariba Network, a leading provider of spend management services.

The press release says the integration will enable SMEs "to seamlessly transfer their invoices from the Ariba Network to the Exchange’s proprietary trading platform for auction. Leveraging a cash optimizer tool embedded in the latest release of the Ariba Network, suppliers can calculate their cash needs as compared to their eligible outstanding invoices and select the invoices they want to sell to help them optimize their working capital management and improve their cash flow."

This is virtually the same model Zopa and various collaborators took to potential UK clients and partners in 2008. Marketing was the only (major!) hurdle, and we were in talks with someone very big and friendly to support it. But, as is often the way with these types of services, there were simply too many interim integration steps competing against higher core priorities for the service to go into development.

Full credit to the Receivables Exchange for getting this launched - although I still think they need a bigger brand name that is already well-known to all SME's if they are going to get real traction against the established sources of trade finance. I wish them luck.

Maybe it's a signal that Zopa and its partners should dust off their plans...