Summary of “A digital capitalism Marx might enjoy”

Not for nothing did Karl Marx title his indictment of industrial economies, simply, Capital.
The world may soon face a new era of conflict between labor and capital, based on a relationship between the two far different from that which animated Marx.
In their recent book, Capitalism Without Capital, Jonathan Haskel and Stian Westlake describe a 2006 analysis of Microsoft.
On the one hand, as machines grow increasingly autonomous, capital will need fewer workers.
Capital is learning from labor in order to mimic labor and eventually replace it.
Within the elite firms developing and deploying the technologies that are changing the economy, the most valuable corporate capital is the culture-the procedures and norms that shape interactions between highly skilled workers, turning their individual expertise into profitable new ways of doing things.
The case for such a radical approach grows as information accounts for more of the indispensable capital in the economy.
With new capital comes a new capitalism-perhaps one, finally, that Marx could warm to.

The orginal article.

Summary of “Nobel-winning economist Jean Tirole on how to regulate tech monopolies”

The Frenchman is the foremost thinker on market power and regulation, and won the Nobel prize in 2014 for his work in this area.
Are tech firms like Google, Amazon, and Facebook monopolies?
Large economies of scale as well as substantial network externalities imply that we often have monopolies or tight oligopolies in the new economy.
The key issue is that of “Contestability.” Monopolies are not ideal, but they deliver value to the consumers as long as potential competition keeps them on their toes.
Is it possible that today’s tech monopolies will also face stiff competition one day?
Do you think tech monopolies cause more harm than good? Who pays the price for any harm they cause? It seems like, unlike monopolies in the past, tech consumers face low or zero prices.
Does market power justify regulation? If so, can a traditional approach to regulation offer a solution?
Such regulation tries to regulate profit in industries characterized by natural monopoly conditions.

The orginal article.

Summary of “Tomorrow’s cities: Google’s Toronto city built ‘from the internet up'”

On Toronto’s Eastern waterfront, a new digital city is being built by Sidewalk Labs – a firm owned by Google’s parent Alphabet.
Sidewalk Labs promises to transform the disused waterfront area into a bustling mini metropolis, one built “From the internet up”, although there is no timetable for when the city will actually be built.
“Writing on news website The Conversation, Mariana Valverde, urban law researcher at the University of Toronto, said:”The Google folks have not approached the city in the usual, highly-regulated manner, but have been negotiating, in secret, with the arms-length Waterfront Toronto.
For its part, Sidewalk insists that this year will be all about consultation – with city leaders, local policymakers and the wider community, to ensure what is achieved in Toronto is something that “Meaningfully improves lives”.
As part of the planning process of bidding to develop the waterside location, the firm looked at 150 examples of smart cities, including those built from the ground up such as Masdar, in Abu Dhabi and Songdo in South Korea.
“One of the mistakes that previous cities have made is the idea that you can plan something from the top. That is not how cities work – they evolve organically.”
Mr Doctoroff is a big fan of Jane Jacobs, an urbanist who fled New York to live in Toronto and spent her life encouraging cities to improve their shared spaces.
Whether the Google firm’s city experiment will fulfil this promise is one many will be watching with interest.

The orginal article.

Summary of “Ideo redesigns the dreaded annual review”

No one likes annual reviews: They’re structured, overly formal, and they make it difficult to get real feedback that you can act upon.
According to people who work at the firm, associates would get feedback from partners infrequently-if at all-that was completely out of date.
Lawyers would get a ranking that was supposed to tell them something about their place within the firm, but often didn’t have any bearing on their performance-something that happens at other law firms too.
So Hogan Lovells called in global design firm Ideo to help turn the dreaded annual review process into something that’s actually useful.
After a few weeks of talking to partners and associates, Ideo created “Pathways,” a new way of thinking about feedback that-shockingly-doesn’t require an app.
“When we did our research, we thought we could go the tech route, but it’d probably reinforce the behaviors they were trying to change,” says Rochael Soper Adranly, an Ideo partner and the firm’s general counsel who guided the design of the project.
“Associates now are a lot more empowered to request feedback to get the feedback they need,” says Ann Koppuzha, an associate at Hogan Lovells.
“Koppuzha recounted one instance where she asked a partner to give her the 10 minutes of feedback via email. Because it was supposed to be a short conversation, he ended up calling her right away. One piece of feedback was that she should feel more comfortable”managing upwards”-in essence, keeping the partners she works with on task by reminding them about deadlines.

The orginal article.

Summary of “Tomorrow’s cities: Google’s Toronto city built ‘from the internet up'”

On Toronto’s Eastern waterfront, a new digital city is being built by Sidewalk Labs – a firm owned by Google’s parent Alphabet.
Sidewalk Labs promises to transform the disused waterfront area into a bustling mini metropolis, one built “From the internet up”, although there is no timetable for when the city will actually be built.
“Writing on news website The Conversation, Mariana Valverde, urban law researcher at the University of Toronto, said:”The Google folks have not approached the city in the usual, highly-regulated manner, but have been negotiating, in secret, with the arms-length Waterfront Toronto.
For its part, Sidewalk insists that this year will be all about consultation – with city leaders, local policymakers and the wider community, to ensure what is achieved in Toronto is something that “Meaningfully improves lives”.
As part of the planning process of bidding to develop the waterside location, the firm looked at 150 examples of smart cities, including those built from the ground up such as Masdar, in Abu Dhabi and Songdo in South Korea.
“One of the mistakes that previous cities have made is the idea that you can plan something from the top. That is not how cities work – they evolve organically.”
Mr Doctoroff is a big fan of Jane Jacobs, an urbanist who fled New York to live in Toronto and spent her life encouraging cities to improve their shared spaces.
Whether the Google firm’s city experiment will fulfil this promise is one many will be watching with interest.

The orginal article.

Summary of “The financial scandal no one is talking about”

Nestled among the hedge-fund managers on Grosvenor Street in Mayfair, Number Twenty had recently been opened by accountancy firm KPMG. It was, said the firm’s then UK chairman Simon Collins in the fluent corporate-speak favoured by today’s top accountants, “a West End space” for clients “To meet, mingle and touch down”.
The following year the number edged up – as it did for the other three big four firms despite the stiff competition – to $36bn.
Where a degree of independent oversight does exist, such as from the regulator established in the US following the Enron scandal and the other major scandal of the time, WorldCom – in which the now-defunct firm Arthur Andersen was accused of conspiring with the companies to game accountancy rules and presenting inflated profits to the market – powers are circumscribed.
In what one former big-four partner described to the FT as a “Faustian relationship” between government and the profession, the firms escape official scrutiny even at low points such as the aftermath of the financial crisis.
Covering every area of business and public service, the big four firms have become the reporter’s friends.
With serious financial incentives to get to the top, the major firms end up run by the more materially rather than ethically motivated bean counters.
In the UK in 2017, none of the senior partners of the big firms had built their careers in what should be the firms’ core business of auditing.
“Whether serving as a steward of the proper functioning of global financial markets in the role of auditor, or solving client or societal challenges, we ask our professionals to think big about the impact they make through their work at Deloitte,” say the firm’s leaders in their “Global Impact Report”.

The orginal article.

Summary of “There Is Another”

Every time you use Spotify, grouping songs into playlists, and your music pops into your friends’ feeds, giving them ideas, Spotify gets better, making it a Benjamin Button firm.
Unlike Apple Music, being a pure-play gives Spotify more cred among purists, young people, and influencers.
Spotify accounted for 36% of premium music subscribers globally.
Anyway, despite a substandard offering, Apple Music is growing faster in the US than Spotify, as the Apple Music icon is on the home screen dock of 1B iOS devices.
Apple charges Spotify a 30% tax to be in the App Store and denied an update to the iOS Spotify app, essentially blocking iPhone users’ access to the latest version of the Swedish service.
Netflix needs to become Spotify before Spotify becomes Netflix.
Nobody has cracked social and TV, and as half of young people no longer watch cable TV, if Spotify were to launch video and captured any reasonable share and engagement via unique playlists, then cable and Netflix would begin ceding market cap to Spotify.
Spotify now means streaming music – it could mean social entertainment.

The orginal article.

Summary of “Killing Strategy: The Disruption Of Management Consulting”

The strategy industry is worth $250B, and the value of strategy is obvious to every company, from the smallest startup to the biggest Fortune 500.
Ironically, with this new business model, the company found that management consulting firms – often hungry for very specific, niche expertise – were some of its best customers.
Clients judge whether or not the solution will be good based on indirect signals: the consulting firm’s brand and prestige, the specific domain of knowledge required to solve the problem, and the company’s prior experience with that firm and consultants in general.
Over the years, we’ve seen companies move from hiring consultants to building out entire strategy functions inside their company – teams, staffed by ex-consultants and others, who can perform the role of a management consultant internally.
“We know that many companies have hired small armies of former consultants for internal strategy groups and management functions, which contributes to the companies’ increasing sophistication about consulting services Typically these people are, not surprisingly, demanding taskmasters who reduce the scope of work they outsource to consultancies and adopt a more activist role in selecting and managing the resources assigned to their projects.”
If companies are hiring ex-consultants to do strategy, and working less with the big consulting firms, it would certainly spell a recipe for disruption.
Today, the wide availability of tools that help companies collect and analyze huge amounts of data, on-demand domain experts, and previously “Black-boxed” consulting resources and ex-consultants have taken a chunk out of the strategic value proposition of the big management consultancies.
That’s not a problem that necessitates a McKinsey-level of involvement – and the company can probably get just as good results by working with a pricing expert sourced through somewhere like BTG. Smaller generalist consulting firms might have trouble competing with the possible disruption factors outlined above.

The orginal article.

Summary of “96-Year-Old Secretary Quietly Amasses Fortune, Then Donates $8.2 Million”

Ms. Bloom’s will allowed for some money to be left to relatives and friends, but directed that the bulk of the fortune go toward scholarships of Ms. Lockshin’s choice for needy students.
Like Ms. Bloom, Leonard Gigowski, a shopkeeper from New Berlin, Wis., who died in 2015, left his secret $13 million fortune to fund scholarships.
While her aunt’s wealth was a surprise, Ms. Bloom’s quiet plan to help students was not, Ms. Lockshin said.
Over her 67 years with the firm, Cleary Gottlieb Steen & Hamilton, it grew to its current size, with more than 1,200 lawyers, as well as hundreds of staff members, of which Ms. Bloom was the longest tenured, said Paul Hyams, a human resources executive for the firm who became good friends with Ms. Bloom over his 35 years working there.
Even when she married, Ms. Bloom kept her given name, which was indicative of her independent nature, said a cousin, Flora Mogul Bornstein, 72.Nearly all the money was in Ms. Bloom’s name alone, Ms. Lockshin said, adding that it was “Very possible” that even Mr. Margolies did not know the size of his wife’s fortune.
Ms. Bloom agreed to move to a senior residence mainly because “She wanted to find a good bridge game,” said Ms. Bornstein, a retired social worker.
Ms. Lockshin said an additional $2 million from Ms. Bloom’s bequest would be split between Hunter College and another scholarship fund to be announced.
Ms. Bloom’s view of education was informed by her own public school experience and by working with successful lawyers from highly rated colleges and law schools, he said.

The orginal article.

Summary of “Inside the World’s Most Elite Traders’ Club”

It has no name and no board of directors but has a roster drawn from the world’s wealthiest and most successful traders.
“It would be something for famous traders or investors with significant personal wealth who would have no trouble posting large amounts of collateral.”
To trade swaps and other OTC contracts with Citigroup, an individual must have a net worth of at least $25 million, $5 million or more of which must be deposited in an account with the bank, according to people familiar with the matter.
The Finnish native, who was a member of Pimco’s investment committee and head of global risk oversight at the company, traded interest-rate swaps and currency derivatives with the U.S. banks between leaving Pimco and joining Capital Group Cos.
Kieran Goodwin, the former head trader at King Street Capital Management, traded with an ISDA between leaving the fund in 2010 and starting his own firm in 2012, New York-based Panning Capital Management, according to a person familiar with the matter.
Rules created to prevent another crisis have increased capital costs for lenders trading derivatives that are not processed through a clearinghouse; what’s more, lawsuits that focused on mis-selling of derivatives prodded banks to be more selective with whom they are willing to trade.
In some cases, bank employees have been able to obtain ISDAs to trade with their employers, an arrangement typically facilitated by the bank’s wealth-management unit.
“I got the ISDA because I’m a prop trader at heart and needed to be able to invest and was pretty restricted on the desk in terms of what I was allowed to invest in,” said Wang, who signed a separate agreement with Bank of America Corp.The set-up whereby a bank trades with its staff can create potential conflicts of interest, such as when junior colleagues are leaned on to give their seniors a good price on personal trades, which can be processed through the same desk as client orders, according to people familiar with the matter.

The orginal article.