In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche
The major reason Jack Ma will stay away from mass retail in the U.S. is that the cost of entering in the market could simply be too high. The revenue from a large-scale U.S. retail operation might not justify the cost of setting up such a venture.
Read MoreJPMorgan Chase (NYSE: JPM) reported that one million of its account holders are now using Apple Pay at its Investor Day on Tuesday, February 24, 2015. That means one million customers of one of the nation’s largest banks are using an alternative to traditional banks. Bank consumer behavior is changing faster than we thought.
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One reason why the poor stay poor is that they often lack the opportunities to save money that middle and even working class Americans enjoy. By save I don’t mean put money in a bank account, which is obviously important, but simply pay less to live.
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Since most poor people have or could easily buy a smartphone, the government could simply disperse the aid to an app such as Venmo or Apple Pay. This would eliminate the paperwork, and it could be used to greatly reduce the bureaucracy.
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So what will post-consumer society be defined by? My guess is it will be defined by a lot of choices, and a few giant retailers that provide those choices. An example would be Amazon.com.
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The same-day delivery war will be won by the company willing to stick it out, invest money, and spend several years slowly building up and rolling out its service. In that time, we’re liable to see consolidation and alliances Walmart or Amazon.com teaming up with Google Express, or Google contracting with Kroger or Uber to provide deliveries.
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The Superchargers seem to violate one of the basic rules of business and investment as outlined by Benjamin Graham: Don’t lose money! Graham, as value investors know, once famously said that “don’t lose money” was Rule #1 for investors; Rule #2 was see Rule #1. The Superchargers don’t make money—they cost money—and the disturbing thing is that they could make money.
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The existence of next generation payment mediums like Bitcoin and market-based lending like portfolio loans will make for extreme economic volatility. Nothing, it seems, will stay the same in today’s economy of destruction.
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It looks as if holiday shopping season 2014 could be something of a bust. That means 2015 could become a very ugly year for department stores with lots of store closings, cutbacks, restructuring, layoffs, and losses. The retail recovery could be turning into a retail apocalypse for the department store industry.
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The threat to banks is best shown by PayPal’s growth rate. PayPal’s mobile payment volume increased by 72% between the third quarters of 2013 and 2014, growing to $12 billion. Mobile payments now make up 20% of PayPal’s payments. Venmo, a mobile payment App offered by PayPal subsidiary Braintree, saw its payment volume grow by 50% between the third quarters of 2013 and 2014.
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