How Amazon Can Blow Up Asset Management • Hacker News Board

Re: How Amazon Can Blow Up Asset Management

#51

Post by y4mi » Wed, Mar 07, 2018, 12:32 PM UTC

compsciphd wrote: post #7

obblekk wrote: post #3

If Robinhood, a start up with very few resources, can offer commission free trading, I'd bet Amazon could offer approximately 0 cost S&P500 funds. If the partnership with JP Morgan works, people could direct deposit money into their Amazon account, auto-invest into Amazon funds, and then spend on Amazon ecommerce. In this model, Amazon immediately saves ~2% on credit card transaction fees, a small portion of which co…

vanguard and fidelity offer approximately 0 cost S&P500 funds already today. you're talking .03% in fees. On a $1Mil investment that's $300 a year.

> you're talking .03% in fees. On a $1Mil investment that's $300 a year.

i thought vendor creditcard fees are 2-3%? that would come out at $20-30k for each $1Mil

Re: How Amazon Can Blow Up Asset Management

#52

Post by ceejayoz » Wed, Mar 07, 2018, 12:59 PM UTC

y4mi wrote: post #51

compsciphd wrote: post #7

Earlier quoted context omitted.

vanguard and fidelity offer approximately 0 cost S&P500 funds already today. you're talking .03% in fees. On a $1Mil investment that's $300 a year.

> you're talking .03% in fees. On a $1Mil investment that's $300 a year. i thought vendor creditcard fees are 2-3%? that would come out at $20-30k for each $1Mil

It’s not 2-3% at Amazon’s volume. Amazon also allows you to load up a gift card balance with a checking account.

Re: How Amazon Can Blow Up Asset Management

#53

Post by mabbo » Wed, Mar 07, 2018, 1:03 PM UTC

Why does it have to be Amazon? Look, Amazon's strategy isn't complicated.

Find a market where margins are large ("your margin is my opportunity"). Bring a simple, easy competitor to the market and aim for zero profit. Grow wildly. Build related products that either your customers want (and go elsewhere for) or else you are currently spending money on. Repeat until billionaire.

Anyone with some capital, industry-specific knowledge and a bit of courage can try this strategy. It won't always succeed. But the point is that waiting for Bezos or Musk or some other behemoth to solve all the world's problems rather than doing it ourselves is a very poor way to live.

Re: How Amazon Can Blow Up Asset Management

#54

Post by arsenico » Wed, Mar 07, 2018, 1:15 PM UTC

I am amazed, how much people underestimate the whole complexity of setting up a successful fintech. Basically, you don't have to work for the clients - you need to work for regulators, and also for risk and compliance, and also for duty of care, and much much more, on the thinnest possible margin, if you want to be competitive. Setting up AI to help people make investment decisions is a nightmare due to the number of dimensions you need to take into account while validating data.

I really hope Amazon doesn't start the investment service in the way described in the article.

Re: How Amazon Can Blow Up Asset Management

#55

Post by mseebach » Wed, Mar 07, 2018, 1:17 PM UTC

deanCommie wrote: post #34

thisisit wrote: post #4

Amazon has a serious problem with counterfeit goods and fake reviews. One might think that with the rise of AI/ML catching fake reviews and counterfeits will be much easier but Amazon doesn't seem to be doing any thing. In which case, allowing them to handle money seems like a recipe for disaster. As for the Ant Financial comparison, I find it hard to believe that Amazon is not utilizing the reserves it gathers by se…

> but Amazon doesn't seem to be doing any thing. I would have thought that on Hackernews of all places people would recognize the scale that is involved with a site like Amazon and recognize that fixing this problem is far from trivial. I'm sure Amazon is taking it very seriously - when have they ever shown anything but "obsession" about positive customer experiences. But it is hard, and it will take time to do it ef…

There are any number of steps they could take to dramatically decrease the counterfeiting problem, chief among them to make sure the customer can choose which supplier the goods to fulfill the order comes from.

I think Amazon is making a bet that reducing the number of SKUs in their warehouses is of greater value than counterfeiting is a problem - and this is probably true for a ton of their more generic stuff that comes from the same factory in China anyway.

Re: How Amazon Can Blow Up Asset Management

#56

Post by powvans » Wed, Mar 07, 2018, 1:25 PM UTC

I got my law degree at Costco.

This is the umpteenth thread where commenters are complaining about the sad state of Amazon’s retail. I hear a constant stream of complaints about counterfeit goods, fake reviews, less than great pricing, and shipping that takes longer than promised. I’ve personally experienced all of the above and cut way back on Amazon.

How many companies thrive while the quality of their core business withers?

Of course, maybe retail isn’t their core. Maybe the core is providing barely acceptable products and services at razor thin margins. In that light asset management makes perfect sense.

Re: How Amazon Can Blow Up Asset Management

#57

Post by yjftsjthsd-h » Wed, Mar 07, 2018, 1:25 PM UTC

deanCommie wrote: post #34

thisisit wrote: post #4

Amazon has a serious problem with counterfeit goods and fake reviews. One might think that with the rise of AI/ML catching fake reviews and counterfeits will be much easier but Amazon doesn't seem to be doing any thing. In which case, allowing them to handle money seems like a recipe for disaster. As for the Ant Financial comparison, I find it hard to believe that Amazon is not utilizing the reserves it gathers by se…

> but Amazon doesn't seem to be doing any thing. I would have thought that on Hackernews of all places people would recognize the scale that is involved with a site like Amazon and recognize that fixing this problem is far from trivial. I'm sure Amazon is taking it very seriously - when have they ever shown anything but "obsession" about positive customer experiences. But it is hard, and it will take time to do it ef…

> I would have thought that on Hackernews of all places people would recognize the scale that is involved with a site like Amazon and recognize that fixing this problem is far from trivial.

Yes, but:)

Fixing it is far from trivial, BUT there are trivial things that would help. It's the 80/20 rule again; sure, a full solution would take years and be a massive undertaking, but even a minor effort would make a big dent in the problem.

Re: How Amazon Can Blow Up Asset Management

#58

Post by BatFastard » Wed, Mar 07, 2018, 1:31 PM UTC

Lots of FicTech in my city. From friends who work for these companies. They are a mess. Amazon needs to come in revolutionize the market place. But if they did, they would get broken up.

Short term question is whether Walmart will survive, I hope they do much as I despise the company. Amazon needs competitors. Longer term is will it be Alibaba vs Amazon worldwide? Interesting times...

Re: How Amazon Can Blow Up Asset Management

#59

Post by muddi900 » Wed, Mar 07, 2018, 1:34 PM UTC

powvans wrote: post #56

I got my law degree at Costco. This is the umpteenth thread where commenters are complaining about the sad state of Amazon’s retail. I hear a constant stream of complaints about counterfeit goods, fake reviews, less than great pricing, and shipping that takes longer than promised. I’ve personally experienced all of the above and cut way back on Amazon. How many companies thrive while the quality of their core busines…

Amazon's business model is built on predatory pricing. Their Cloud business is wholly subsidizing there monopolistic grand plan.

Re: How Amazon Can Blow Up Asset Management

#60

Post by avoutthere » Wed, Mar 07, 2018, 1:49 PM UTC

How long before we see Amazon break themselves up as Google did into Alphabet? This seems like a solid approach to prevent government anti-monopoly action.