A day in 2015

inSight

23 Nov 2000

A day in 2015

Joseph Yam has written a number of articles in this column on the technological revolution now in full flood. In this week's column, he imagines what life might be like for the financial industry in fifteen years time.

He had had a bad night. He had forgotten to switch off the new e-mail alert feature he had installed the day before in his ICD, or Implanted Communications Device, and he was too sleepy to get up to do it from the computer in his study. And he did not want to switch off the ICD altogether, (something which he could do without moving, for it was voice-activated) in case of urgent telephone calls. Perhaps he should have gone for a voice-activated on/off switch for this new e-mail alert feature. Perhaps he should have forgotten about the e-mail alert altogether, because unlike phone calls, which could be taken through the ICD, e-mails still had to be read at the computer screen. In the event, the four e-mail alerts conveyed through his ICD during the night woke him four times, even though before he went to bed, he had already turned down the amplitude of the vibrating alert to its minimum.

He had a bad breakfast too. He had run out of orange juice and the supermarket delivery had been somehow delayed, despite the assurance that e-mail orders made before noon would be delivered the same day before nine in the evening. Well, at least he had a relatively easy day ahead, this being one of two days in a four-day week in which he could choose to work from home, where he did not have to even dress casual - or even dress at all - as long as there were no video calls. In his capacity as a legislator with a special interest in economic and financial affairs, he wondered for a moment whether the monopoly the supermarket was now enjoying might be undermining the efficiency of its service. Although it was only 7.30 in the morning, he voice-activated a call through his ICD to the PUS, or Permanent Under Secretary, for Economic Services, as he keyed into his computer the "work mode" to start the clock of his working day ticking. He knew that his good friend the PO, or Principal Official, with political responsibility on the subject, did not mind his getting in touch directly with the PUS.

His main job, when not on Council business, was as an investment advisor. He has been so good at it that his employer allowed him to clock his time on public duty as work, after he was elected legislator with a decisive majority. He got the voice box of the PUS, who seemed to him always to be very particular about privacy outside of office hours. Instinctively, he made the usual sarcastic remarks to the voice box about how comfortable life was for a civil servant, particularly a PUS, now that policy as well as political responsibility was carried by the PO. He then requested reports within 24 hours on the status of the draft Bill to limit market share in specified trades and the ongoing discussion about a related model scheme of control for monopolies, not forgetting to say that he would be raising these issues with the PO.

He then started to check his e-mail, while running his hand over the roughness of his unshaven face. He felt happy that, with the weekend starting tomorrow, he did not have to shave for another three days. The overnight e-mails were the usual market reports from the offices of his firm in London and New York, and the authenticated messages of trading positions being passed from London to New York and from New York back to him in Hong Kong. There was nothing unusual, other than the further strengthening of the euro that he had expected: this meant that the long positions he had been running were looking better and better. It could mean an even larger bonus for the year. He was already feeling rather refreshed, notwithstanding the bad night. He checked the activity in the market for Hong Kong stocks, now a market that ran 24 hours a day, and found that, at this early hour in Hong Kong and late hour in New York, only small deals were being done. It would be at least nine in the morning before activity picked up. Noting from the overnight e-mails that the inflation number just released in the US was rather moderate, he was quite sure that the Fed funds target rate would not be raised by the FOMC next week. He opened the word-file of his unfinished weekly market insight report for Hong Kong and put the final touches to it. He read it carefully again before pressing the send button to disseminate it to the growing number of subscribers, advising them, in the short to medium term, to increase their exposure to Hong Kong stocks and to hold their long euro positions, and offering his services. He was sure that this would bring in another ten million or so in business that day.

Indeed, the first million came in at 9 am from KS (which stood for his "King Size" account) through the RTGS system of the HKMA, which had by now been extended to bank customers via the internet. As usual, since KS after retirement still sat on the boards of a large number of listed companies, the money was to be managed on a totally discretionary basis, with, of course, a generous fee. He immediately put the money to use. He accessed the Internet page where the money banks advertised their interest rates for intra-day deposits, chose one that allowed repayment on demand, real time, switched to the page of that bank and placed the money, again through the RTGS system, settling the deal at 9.05 am. He wanted to allow himself a little more time to pick the right financial instruments for KS, at least after he had had the chance to wake up his London contacts at a more civilised hour and check a few things.

The phone calls and e-mails started coming in, but none of them raised matters he could not deal with in less than five minutes. By noon, his ten million forecast for new money for the day had already been surpassed. And he dealt with them with his usual efficiency, in accordance with his strategy for the day. He put a third of the new money in the Tracker Fund, a third in two-year Exchange Fund notes to benefit from the likely market reaction to the more benign inflationary outlook, and a third in the IPO of the Hong Kong Mortgage Corporation, closing at noon. He even managed to earn some intra-day interest on the money before parting with it. And all of this while he was still in his pyjamas. Technology had indeed increased his productivity, and quality of life, immensely.

The supermarket delivery eventually came at noon. While the maid was checking the delivery against the e-mail order, he dialled up his bank account and downloaded enough e-cash to his multi-purpose smart card to pay for the bill and the allowance for his son for the weekend when he got back from school. He inserted his smart card in the payer slot of his "portamento", as the palm-sized debit/credit machine was called, and punched in his PIN to agree to have the amount of the bill debited from his card and credited to the supermarket's card in the payee slot. He was old-fashioned about cash, and always insisted on using his own portamento for fear of information in his card being stolen using his counterparty's portamento, notwithstanding the privacy protection device now built in to all smart cards. The deliveryman muttered something about it being more convenient paying at the time when the e-mail order was placed, but he took no notice, being very firmly of the view, with his financial background, that every transaction should be settled DvP.

Time for some exercise. He changed into his shorts, switched off his ICD, turned on his hifi and jogged for half an hour on his treadmill, checking occasionally the currency page for wayward movements. He showered afterwards, put on a clean shirt for the video calls he planned to make later, and consumed the Caesar salad his maid had prepared for his lunch.

At 2pm sharp, he switched on his ICD again and activated the video mode - it was important that he could read the facial expressions of the person he was to talk to. He voice-activated a London number. It took a whole minute for the sleepy face of the other side - a lady - to come on to the screen. He asked, point blank, whether the Monetary Policy Committee of the Bank of England would raise interest rates at its afternoon meeting. Back came the annoyed reply that, since she was not a member of the MPC she could not possibly answer the question. She went on, nevertheless, to offer her opinion, with an enthusiasm that could be detected even through the video. He listened and watched, and let her continue with her prediction that the sterling market might be in for a surprise, until he had enough to convince himself that his respected London contact was on to something worthwhile. He then gave instructions to her to sell five London stock futures contracts on receipt of the necessary margin deposits, which he was already organising using the lower part of the partitioned screen of his computer. He called the one million intra-day Hong Kong dollar deposit and used it to buy sterling for immediate delivery, PvP, to his client's account with his London contact. He was sure that KS would like this one.

He sent a reporting e-mail to KS, describing what he had done for him, attaching also the electronic records of the relevant transactions. He then wrote his Hong Kong market report for the day, and e-mailed it to his colleagues in the offices in Hong Kong, London and New York. He also prepared and checked meticulously the outstanding market positions and passed them, through the usual authenticated message, to London, and copied it to New York and to internal audit. By then, he had clocked about nine hours of working time for that day, or well over 40 hours for the week. And he still had to read the two reports that he had asked for early in the morning, and just received, from the PUS, whose efficiency this time surprised him. Perhaps this could wait. He turned on his home theatre equipment instead, downloaded the classic movie "crouching tiger, hidden dragon" from the movie archive website for a small fee, which he allowed to be debited from his smart card, and began his long weekend.

Joseph Yam
23 November 2000

Click here for previous articles in this column.

Document in Word format

Latest inSight
Last revision date : 23 November 2000