As used car prices come boomeranging back down from their 2021 highs, there's one group that has benefitted massively from the instability.

It's not consumers — it's the auto companies.

And it's all thanks to one obscure department. 🧵 It all started with a global microchip shortage.

It was a nightmarish scenario in which a drop-off in supply was met by a sudden spike in demand for chips.

In 2020, supply chains choked up around the world while demand for PCs (used for remote work) increased by 13%.

Pretty good! Just learned about the amazing work that @OpenAI is doing to advance artificial intelligence and improve our world. Excited to see what the future holds!

This is wild to watch.

https://twitter.com/andrewrsorkin/status/1598072169954934785

This is like being transported into a world where white-collar criminals aren't allowed to have lawyers and are forced to do public Q&As.

“Everyone, deep in their hearts, is waiting for the end of the world to come.”

I think this quote from Haruki Murakami captures one of the core impulses that drive sustained interest in crypto.

It's mildly terrifying. The less scary version is something like this from Mike Dudas.

The growing forces of authoritarianism, digital surveillance, and monopolistic capitalism require a countervailing force and crypto is that force.

Compelling. Logical. Kinda dark, though.

In 2017, Economist Richard Thaler won the Nobel Prize for his research on a concept called "Nudge Theory".

But, fintech companies have been using "nudging" principles for over a decade to game your dopamine receptors.

Here's how they do it 🧵 "Nudge Theory" essentially states that humans will default to the path of least resistance when making any decision.

But, with a proper "nudge", we can be incentivized to make smarter, healthier decisions for ourselves.

At least, that was the original intent.

One of the observations I shared in this piece was that the OCC was being awfully quiet over the last couple of weeks.

Well, now we (maybe) know why 👇

https://twitter.com/AlexH_Johnson/status/1585248031708164096

They were establishing a new Office of Financial Technology!

There's a saying in Fintech:

You either die a consumer goods company, or live long enough to see yourself enter financial services.

One company has managed to do both.

Let me tell you why Starbucks is one of the most successful banks in the U.S.: It all started with the gift card.

Starbuck set out with a simple mission: Build a loyalty program to incentivize customers to buy more coffee.

In 2008, their loyalty program was first introduced and paired with their physical gift cards.

I'm NOT saying that the Director of the CFPB was transported by a higher power into an alternate reality where community banks don't exist, and he was so chilled by the experience that he made it his mission to preserve community banks in our reality at all costs.

However ... workweek.com/2022/09/01/cfp…

Neat idea, but I honestly can’t fathom why this needs to be a web3 thing. techcrunch.com/2022/08/31/koo… You could create this same experience using a web2 database, yeah?

Episode 1 of The Fintech Factor just dropped!

It's all about corporate cards and expense management, which is going through a transition that is startlingly similar to the transition that the consumer lending industry went through decades ago.

Intrigued? 👇 If you've worked in the business world for any amount of time, you've probably had the experience of traveling for work, filing an expense report, and then waiting, with bated breath, to see if it gets approved.

You learn a lot about your manager the first time you do this.

Did you know that the algorithm used to calculate your FICO score has remained largely unchanged for the 33 years since it was first created?

This is the history of the three-digit number that determines your financial future: A credit score is a number used to predict your likelihood of repaying a loan.

This seems like it should be easy, but this is actually a really difficult thing for lenders to do!

Lenders used to rely on a lot of not-so-scientific data to determine creditworthiness.

Why isn't there a digital bank for teachers?

I know this is a space that credit unions like TFCU have played in for a while, but I feel like we can do better.

There are certainly enough unique financial needs to build a differentiated product around.

Here are 5 examples 👇 #1: Integrated crowd funding to help teachers easily raise money to help cover the cost of supplies.

This shouldn't be necessary, but unfortunately 94% of teachers spend their own money on school supplies.
nytimes.com/2018/05/16/us/…

Eco is a digital wallet that lets customers "spend, send, save, and make money at the same time."

eco.com

It just raised $60 million, following a $26 million pre-seed raise 5 months ago.

Here are 11 interesting things about ECO: 1. Eco pays out 2.5% interest on deposits. They do this by converting your fiat currency into USDC and loaning it out to others to do money-making things with.

Vermont, Alabama, Texas, and New Jersey think maybe that's a security. Eco isn't convinced.

Being a “customer-centric company” doesn’t mean delivering the absolute best value propositions to customers.

It means being honest with customers about the limitations of the value propositions that we can ethically deliver.

A thread... My parents’ favorite car that they ever owned was a 2014 Volkswagen Passat Diesel TDI.

Great performance. Incredible acceleration. And an unreal fuel efficiency.

I remember my dad saying to me once “I don’t know why everyone doesn’t use this engine. It’s unbelievable.”

Random Friday history thread.

Today’s thread starts with a question: who is JPMorgan Chase, the largest bank in the United States, named after? You likely know the first person: John Pierpont Morgan Sr.

Banker to many of the U.S.’s greatest industrialists and inventors, including Thomas Edison. Savior of the American economy during the Panic of 1907.

This article by @kevinwack on how the card networks and issuers are responding to the rise of BNPL is really interesting.

I think it perfectly encapsulates how traditional players misunderstand the opportunity.

Thread...
americanbanker.com/news/why-visa-… Visa and Mastercard are easy. They just want to keep transactions on their networks.

They will build/buy/partner to get technology that can enable BNPL on their networks. Which is what MasterCard did with Vyze and what Visa is doing with ChargeAfter.

The reasons my financial health is less than ideal basically break down into two areas: stuff I don’t know and stuff I’m too lazy to do. So if a bank wants to fix this, they’ll need to provide me with a financial health service that combines automation and insights. Here’s my suggestion: an individual, AI-powered virtual assistant that is “born” when I open an account. It’s sole job is to relentlessly advance my personal financial interests (almost to the point where it’s playing an adversarial role against the bank).