Receiving Wide Coverage ...
Brushing the Dust Off IT: Banks around the world use IT systems are basically antiques, and recent tech glitches at Royal Bank of Scotland and Commonwealth Bank of Australia are making that problem increasingly difficult to ignore. The Financial Times reports that part of the issue is that three-quarters of banks' tech spending has to go toward the cost of keeping the old, complex systems running, leaving them with just a fraction of funds to spend on innovation. On the bright side, urgent cybersecurity concerns are forcing banks out of complacency. "Making something secure requires it to be consistent and clean and up to date and well managed," an anonymous tech executive at a U.S. bank tells the paper. Sounds like a reasonable goal! Meanwhile, the New York Times reports that RBS has dealt with the 600,000 unprocessed transactions that resulted from its recent tech failure.
It Shoulda Been Jackson: The Treasury Department's plan to put a woman on the $10 bill has been a crowd-pleaser. But giving Alexander Hamilton the boot appears to be a much controversial move. The Times' Binyamin Appelbaum and Josh Barro are in agreement that Andrew Jackson should have been forced from the $20 note instead. "Mr. Hamilton was one of the best economic policy makers in American history; Mr. Jackson, in addition to being a terrible person, was one of the worst," Appelbaum argues. Hamilton's biographer Ron Chernow is equally outraged, particularly in light of the fact that the founding father is finally receiving more recognition with the debut of the hip new musical "Hamilton." (It's worth noting, however, that Hamilton isn't exactly getting the heave-ho. He'll either share space with the as-yet-unnamed woman or else appear on alternate versions.) The Washington Post is more concerned with the question of how the Treasury will follow through on its promise to incorporate tactile elements on the new $10 bill to help visually impaired people tell the notes apart. Over on Quartz, Heather Landy discusses her "feminist finance geek's mixed emotions" about the decision: "Cash is history. And women deserve recognition for being a part of it. Just like Alexander Hamilton."
Wall Street Journal
Starting next month, merchants that accept American Express will be free to encourage customers to pay with other credit-card brands that charge lower fees. AmEx had prohibited retailers from steering customers toward its competitors, but a federal court ruled in February that the policy violated antitrust laws.
Former AIG chief Maurice "Hank" Greenberg doesn't give up easy. Everyone expected him to appeal a federal judge's refusal to award damages to AIG shareholders who brought a class-action lawsuit against the government over the strict terms of the insurer's 2008 bailout. But Greenberg's appeal is also bringing back the claim that the government rescue was effectively a "backdoor bailout" for banks. Those allegations were dismissed by Judge Thomas Wheeler back in 2013.
The paper's editorial team (and its commenters) are squarely on the side of MetLife in the insurer's quest to overturn its "systemic risk" designation.
Blockchain technology could bring the chaos of securities settlement to an end via standardization, writes Dan Davies, senior research advisor at Frontline Analysts. But he admits any such change may be a long time coming. "It is unlikely that the banks will take on bitcoin in its current form, so they will have to agree on the design of a new standard," he says. Industry-wide consensus and teamwork? That'll take a while.
The paper's Robin Wigglesworth scrutinizes concerns over market liquidity and concludes that there's reason to be worried.
New York Times
A fear of failure is preventing Europe's tech centers from achieving the heights of Silicon Valley, according to the paper. The article also suggests that Europeans are resistant to change and disruption in general; Uber has reportedly failed to take off in London because the city's residents have formed emotional attachments to black cabs. On the other hand, London's status as a fintech hot spot has received plenty of press an angle that goes unacknowledged in the Times piece.
Home prices appear to be roughly on par with income and rent at long last, according to the Times' Neil Irwin. But current market stability could be upset if mortgage rates rise faster than overall economic growth.
Boston University professor of finance Ed Kane tackles the too-big-to-fail issue in an interview with Lynn Parramore on the Huffington Post. "If the law would recognize that taxpayers actually do have an equity position in these banks, then this would create ethical obligations directly from the management to taxpayers," he says.