ARTIFICIAL INTELLIGENCE IN THE FINANCIAL SECTOR
The race to adapt AI in the financial sector has begun.
Although we are only at the beginning, it is already clear that Artificial Intelligence has infinite applications in any Financial Institution
According to this latest study, the Risk and Research teams are leading the way.
Artificial intelligence can be the tool for the financial world to meet customer demands in a smarter, safer and more convenient way to finance, invest and save money.
It can also simplify, streamline, and speed up processes ranging from credit decisions to quantitative trading and financial risk management.
The rise of AI in the financial sector demonstrates how fast the business landscape is changing even in a traditionally conservative area.
Increasingly, AI will be used to:
> risk management
> fraud prevention
> investment
> trading
> personalized financial services
> process automation
AI is rapidly reshaping the business landscape of the financial sector.
There are high hopes for greater security of transactions and accounts, especially with the expansion of blockchain and cryptocurrency adoption.
In turn, this could drastically reduce or eliminate transaction fees due to the lack of an intermediary.
It is also thought that managing personal finances will be exponentially simpler, as AI will be able to plan and execute short- and long-term tasks, from paying bills to preparing tax returns.
And a new level of transparency will come from more comprehensive and accurate reporting of know-your-customer (KYC) and deeper due diligence checks, which now require many hours of human labor.
Artificial intelligence will be a key competitive factor for financial institutions in the future, far beyond process automation.
https://proytecpanamablog.wordpress.com/2023/09/27/artificial-intelligence-in-the-financial-sector/
The race to adapt AI in the financial sector has begun.
Although we are only at the beginning, it is already clear that Artificial Intelligence has infinite applications in any Financial Institution
According to this latest study, the Risk and Research teams are leading the way.
Artificial intelligence can be the tool for the financial world to meet customer demands in a smarter, safer and more convenient way to finance, invest and save money.
It can also simplify, streamline, and speed up processes ranging from credit decisions to quantitative trading and financial risk management.
The rise of AI in the financial sector demonstrates how fast the business landscape is changing even in a traditionally conservative area.
Increasingly, AI will be used to:
> risk management
> fraud prevention
> investment
> trading
> personalized financial services
> process automation
AI is rapidly reshaping the business landscape of the financial sector.
There are high hopes for greater security of transactions and accounts, especially with the expansion of blockchain and cryptocurrency adoption.
In turn, this could drastically reduce or eliminate transaction fees due to the lack of an intermediary.
It is also thought that managing personal finances will be exponentially simpler, as AI will be able to plan and execute short- and long-term tasks, from paying bills to preparing tax returns.
And a new level of transparency will come from more comprehensive and accurate reporting of know-your-customer (KYC) and deeper due diligence checks, which now require many hours of human labor.
Artificial intelligence will be a key competitive factor for financial institutions in the future, far beyond process automation.
https://proytecpanamablog.wordpress.com/2023/09/27/artificial-intelligence-in-the-financial-sector/
THE DOLLAR CRISIS
The domination of the Dollar on international markets was born when the World Economic System was affirmed at Bretton Woods in 1944.
When the English-speaking powers gathered in the town of the state of New Hampshire in the Mount Washington hotel, the pillars of finance and the world economy were erected that led to the creation of financial institutions such as the IMF, the International Monetary Fund, the World Bank and it was decided that the Dollar was the global reserve currency.
Until 1944, the 900 was the century of Nations and, before the Second World War, all attempts to transfer the sovereignty of Nation States to Supranational Organizations had failed.
The most notorious attempt to create a Supranational Forum in which states were forced to obey the will of a higher Institution was with the establishment of the League of Nations, promoted by U.S. President Woodrow Wilson after the end of First World War.
In this, world conflicts have had a function for the financial powers, that of trying to deprive Nations of their independence and sovereignty and have served to satisfy the will of those forces that have imposed themselves on the Nation States from 1945 onwards.
The Second World War succeeded, unfortunately, where the First had failed.
With the birth of the United Nations and the other International Institutions established at Bretton Woods, the Nation States became, despite themselves, supporting actors.
Thus, was born the power of the United States of America, not only on the military level through NATO, but above all with the adoption of the Dollar as a global reserve currency in international trade.
In the beginning, the United States guaranteed the convertibility of the Dollar into Gold.
In 1973, however, the US President, Richard Nixon, decided to abolish the convertibility of the Dollar into Gold.
Since then, the only thing that has guaranteed the Dollar its status has been none other than geopolitics.
The mere fact of owning global reserve currency in international trade and being able to print it on command has ensured the US virtually unlimited political, economic, and financial power.
However, this dominance is rapidly disappearing because the events of the last two years are leading to a phenomenon unprecedented since 1945.
The power of the Dollar is gradually eroding.
If you take a look at international trade, you will notice that today the American currency is used in only 59% of international transactions while only a few years ago, it was firmly above 70%.
And that percentage continues to fall very rapidly.
It is not yet clear whether the BRICS are interested in creating an alternative currency in trade or defining new rules for international trade based on multiple currencies.
In any case, they want to guarantee not only political but also economic parity to overcome the imbalances that have been consolidated since the Second World War.
It should also be borne in mind that from 1 January 2024, 6 other countries will enter the BRICS grouping, Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates and the BRICS will represent 36% of world GDP and 47% of the population of the entire planet.
The domination of the Dollar on international markets was born when the World Economic System was affirmed at Bretton Woods in 1944.
When the English-speaking powers gathered in the town of the state of New Hampshire in the Mount Washington hotel, the pillars of finance and the world economy were erected that led to the creation of financial institutions such as the IMF, the International Monetary Fund, the World Bank and it was decided that the Dollar was the global reserve currency.
Until 1944, the 900 was the century of Nations and, before the Second World War, all attempts to transfer the sovereignty of Nation States to Supranational Organizations had failed.
The most notorious attempt to create a Supranational Forum in which states were forced to obey the will of a higher Institution was with the establishment of the League of Nations, promoted by U.S. President Woodrow Wilson after the end of First World War.
In this, world conflicts have had a function for the financial powers, that of trying to deprive Nations of their independence and sovereignty and have served to satisfy the will of those forces that have imposed themselves on the Nation States from 1945 onwards.
The Second World War succeeded, unfortunately, where the First had failed.
With the birth of the United Nations and the other International Institutions established at Bretton Woods, the Nation States became, despite themselves, supporting actors.
Thus, was born the power of the United States of America, not only on the military level through NATO, but above all with the adoption of the Dollar as a global reserve currency in international trade.
In the beginning, the United States guaranteed the convertibility of the Dollar into Gold.
In 1973, however, the US President, Richard Nixon, decided to abolish the convertibility of the Dollar into Gold.
Since then, the only thing that has guaranteed the Dollar its status has been none other than geopolitics.
The mere fact of owning global reserve currency in international trade and being able to print it on command has ensured the US virtually unlimited political, economic, and financial power.
However, this dominance is rapidly disappearing because the events of the last two years are leading to a phenomenon unprecedented since 1945.
The power of the Dollar is gradually eroding.
If you take a look at international trade, you will notice that today the American currency is used in only 59% of international transactions while only a few years ago, it was firmly above 70%.
And that percentage continues to fall very rapidly.
It is not yet clear whether the BRICS are interested in creating an alternative currency in trade or defining new rules for international trade based on multiple currencies.
In any case, they want to guarantee not only political but also economic parity to overcome the imbalances that have been consolidated since the Second World War.
It should also be borne in mind that from 1 January 2024, 6 other countries will enter the BRICS grouping, Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates and the BRICS will represent 36% of world GDP and 47% of the population of the entire planet.
The domination of the Dollar on international markets was born when the World Economic System was affirmed at Bretton Woods in 1944. When the English-speaking powers gathered in the town of the sta…
INFLATION, RECESSION, INTEREST RATES IN THE USA: FED POLICY
Leading financial analysts are convinced that the Federal Reserve, the Central Bank of the United States, will quickly suspend the rise in interest rates.
The reference rate in the United States of America is currently in the range of 5.25% to 5.50%, the highest figure in twenty-two years.
It is true that after eleven consecutive interest rate hikes since March 2022, inflation has fallen sharply, but the risk of a major recession is already appearing.
Despite the increase linked to energy prices, inflation remains at 3.70%, below the 2022 peak, while still above the Fed's long-term target of 2% per year.
According to Fed Chairman Jerome Powell, economic growth looks solid, and the unemployment rate is near an all-time low and the Fed would therefore like to slow price increases without causing a recession.
Leading financial analysts are convinced that the Federal Reserve, the Central Bank of the United States, will quickly suspend the rise in interest rates.
The reference rate in the United States of America is currently in the range of 5.25% to 5.50%, the highest figure in twenty-two years.
It is true that after eleven consecutive interest rate hikes since March 2022, inflation has fallen sharply, but the risk of a major recession is already appearing.
Despite the increase linked to energy prices, inflation remains at 3.70%, below the 2022 peak, while still above the Fed's long-term target of 2% per year.
According to Fed Chairman Jerome Powell, economic growth looks solid, and the unemployment rate is near an all-time low and the Fed would therefore like to slow price increases without causing a recession.
ASSET MANAGEMENT: AN INCREASINGLY RICH SECTOR
For years, the management of large assets has been a niche activity of the financial sector, writes the Economist these days.
Since 2000, however, it has been experiencing unprecedented expansion.
The wealth to be managed has increased dramatically in the last 20 years and has gone from 160 thousand to 510 trillion dollars of which about 130 trillion in liquidity and it is estimated that by 2030 it should reach 230 trillion.
For the asset management business there will be a lot of work in the coming years that could produce fees of up to 500 billion a year.
Currently, the sector is very fragmented, as it is dominated by relatively small local Banks and Institutions that have established themselves in individual parts of the world.
There are very few operators that really act on a global scale.
In this small group the leaders are Morgan Stanley and UBS flanked by Goldman Sachs and JPMorgan Chase.
Morgan Stanley, after buying many competitors, manages today and mainly abroad, over 6 trillion dollars,
The USB, which has just absorbed its long-standing rival Credit Suisse, has reached 5.5 trillion.
Will only these Institutes benefit from the increase in wealth to be invested?
The Global Asset and Wealth Management Survey 2023 projections show that by 2027, 16% of existing small and medium-sized asset and wealth management (AWM) organizations will have been swallowed up by market leaders.
Digital transformation, changing investor expectations, consolidation and "retailing" are gaining new ground and posing new questions in a context of social, economic and geopolitical upheaval.
In the face of these challenges, leaders will focus on successfully adapting to thrive in the changing industry landscape.
However, AWMs have shown remarkable resilience in adapting to changing market conditions and evolving investor demands, and with increasing short-term pressures, a new generation of AWM organizations is already emerging.
The introduction of new customer-focused technologies ready to operate on a wide range of asset types will be the main challenge in the immediate future.
For years, the management of large assets has been a niche activity of the financial sector, writes the Economist these days.
Since 2000, however, it has been experiencing unprecedented expansion.
The wealth to be managed has increased dramatically in the last 20 years and has gone from 160 thousand to 510 trillion dollars of which about 130 trillion in liquidity and it is estimated that by 2030 it should reach 230 trillion.
For the asset management business there will be a lot of work in the coming years that could produce fees of up to 500 billion a year.
Currently, the sector is very fragmented, as it is dominated by relatively small local Banks and Institutions that have established themselves in individual parts of the world.
There are very few operators that really act on a global scale.
In this small group the leaders are Morgan Stanley and UBS flanked by Goldman Sachs and JPMorgan Chase.
Morgan Stanley, after buying many competitors, manages today and mainly abroad, over 6 trillion dollars,
The USB, which has just absorbed its long-standing rival Credit Suisse, has reached 5.5 trillion.
Will only these Institutes benefit from the increase in wealth to be invested?
The Global Asset and Wealth Management Survey 2023 projections show that by 2027, 16% of existing small and medium-sized asset and wealth management (AWM) organizations will have been swallowed up by market leaders.
Digital transformation, changing investor expectations, consolidation and "retailing" are gaining new ground and posing new questions in a context of social, economic and geopolitical upheaval.
In the face of these challenges, leaders will focus on successfully adapting to thrive in the changing industry landscape.
However, AWMs have shown remarkable resilience in adapting to changing market conditions and evolving investor demands, and with increasing short-term pressures, a new generation of AWM organizations is already emerging.
The introduction of new customer-focused technologies ready to operate on a wide range of asset types will be the main challenge in the immediate future.
INTERVENTIONS FOR CLIMATE CHANGE
Climate change is there for all to see and adapting to new conditions, finding more sustainable technologies and adopting them will take time and much more money than you might think.
Public intervention for this will be unavoidable.
Some governments have already launched ambitious incentive programs.
The most important and substantial is that of the United States: with the Inflation Reduction Act (IRA) the American government has allocated subsidies for 370 billion dollars.
The US federal agency in charge of providing economic data to Congress (Congressional Budget Office) had predicted that energy and climate measures would cost about $391 billion between 2022 and 2031.
However, experts predict long times and higher costs than expected.
Goldman Sachs claims that more than $1.2 trillion could be needed for the development and implementation of the IRA, about three times the amount announced by the White House.
The American public program poses another major problem: the return of protectionism and possible retaliatory actions between states.
The Financial Times has warned of a possible global war on public subsidies because the IRA could attract the most advanced tech companies to the United States.
The countries of the European Union, the main allies of the United States, are the most alarmed because they are aware that they cannot compete with similar incentives.
The Green Deal announced by the European Commission cannot compete with the IRA and German Economy Minister Robert Habeck has declared that American public intervention "is like a declaration of war".
Inflation Reduction Act | Clean Energy | Guidebook | White House
https://www.whitehouse.gov/cleanenergy/inflation-reduction-act-guidebook/
The Green Deal Industrial Plan | European Commission
https://ec.europa.eu/commission/presscorner/detail/en/ip_23_510
Climate change is there for all to see and adapting to new conditions, finding more sustainable technologies and adopting them will take time and much more money than you might think.
Public intervention for this will be unavoidable.
Some governments have already launched ambitious incentive programs.
The most important and substantial is that of the United States: with the Inflation Reduction Act (IRA) the American government has allocated subsidies for 370 billion dollars.
The US federal agency in charge of providing economic data to Congress (Congressional Budget Office) had predicted that energy and climate measures would cost about $391 billion between 2022 and 2031.
However, experts predict long times and higher costs than expected.
Goldman Sachs claims that more than $1.2 trillion could be needed for the development and implementation of the IRA, about three times the amount announced by the White House.
The American public program poses another major problem: the return of protectionism and possible retaliatory actions between states.
The Financial Times has warned of a possible global war on public subsidies because the IRA could attract the most advanced tech companies to the United States.
The countries of the European Union, the main allies of the United States, are the most alarmed because they are aware that they cannot compete with similar incentives.
The Green Deal announced by the European Commission cannot compete with the IRA and German Economy Minister Robert Habeck has declared that American public intervention "is like a declaration of war".
Inflation Reduction Act | Clean Energy | Guidebook | White House
https://www.whitehouse.gov/cleanenergy/inflation-reduction-act-guidebook/
The Green Deal Industrial Plan | European Commission
https://ec.europa.eu/commission/presscorner/detail/en/ip_23_510
Download the Inflation Reduction Act Guidebook On August 16, 2022, President Biden signed the Inflation Reduction Act into law, marking the most significant action Congress has taken on clean energy and climate change in the nation’s history. With the stroke of his pen, the President redefined Ame...