Editor's letter

New industries bring new problems

Data is the new oil. But its very existence – and the fact that so much more is collected every second – comes with some major problems.

932_MW_P03_Contents

Data. It's the new oil. And the UK is swimming in it. We are, it turns out, the second-leading producer of it in the world something that, as Matthew Lynn points out this week, should be seen as really good news. It reminds us just how well the UK tech sector is doing and bodes brilliantly for our future growth (assuming we drive home our headstart). That said, the existence of all this data and the fact that so much more is collected every second comes with some major problems.

There is the conflict between public and private interests, as Gillian Tett notes in the Financial Times. There is the ability for those with the data to mine it to exploit (rather than just sell things to) us. The Financial Conduct Authority has, for example, started to look at how banks could use their data stashes to figure out which customers are too idle/busy to move their money to find better interest rates, and to then keep their rates lower than other people's. Dastardly stuff.

Subscribe to MoneyWeek

Become a smarter, better informed investor with MoneyWeek.

And of course there is basic privacy. As Shoshana Zuboff says in her new book The Age of Surveillance Capitalism, we live in a world where vast "stockpiles of personal data" are kept on all of us. Every product with "smart", "personalised" or "digital' attached to it, is a "supply chain interfaced for the unobstructed flow of behavioural data." Worried? You should be. You should be worried about how all that data can be used to "nudge" your behaviour in ways that don't necessarily suit you. And you should be worried about the security of all that data. You'll find all our usual worries about high fees and low returns in the investment industry in almost every issue of MoneyWeek. But the quickest and nastiest way to lose money (and possibly reputation too) fast? Cybercrime. I'm just starting to look at the cyber insurance options available for individuals and will report back soon. Perhaps we all need it.

"What's the quickest and nastiest way tolose money fast? Cybercrime."

Advertisement
Advertisement - Article continues below

On to investment (there's no point in paying up for extra insurance if you have little to lose). It's still scary out there. In my interview with Bruce Stout, we talk (at length you can hear more on our podcast here) about the rise and rise of global debt; the misery of low growth in the West (with particular reference to the eurozone); and the ongoing failure of tech investors to accept the inevitability of the business cycle affecting them as much as anyone else (Apple is in the middle of providing a salutory example of this see page 10).

That doesn't (as ever) mean there is nothing to buy. Our cover story is on possible opportunities in the gambling industry (we know this isn't for everyone); we also look at smaller Japanese companies (which could be) and smaller US banks. I'd also point out, for those of you looking for income and still thinking about last week's cover story on the best dividend-paying UK stocks, that the yield on the FTSE All Share has now hit 4.5%, the highest level since 2008. Interesting times.

Finally, if you want to hear more on all these subjects on the evening of Tuesday 12 February, John Stepek is running an event with MoneyWeek regular Tim Price and Iain Barnes of wealth manager Netwealth. They'll be talking (over a drink or two) about and answering questions on everything that's going on in the markets right now, from Brexit to trade wars to the end (or maybe not?) of QE. Book your ticket at Theweekevents.co.uk.

Advertisement

Recommended

Visit/519858/how-long-can-the-good-times-roll
Economy

How long can the good times roll?

Despite all the doom and gloom that has dominated our headlines for most of 2019, Britain and most of the rest of the developing world is currently en…
19 Dec 2019
Visit/517688/the-british-equity-market-is-shrinking
Stockmarkets

The British equity market is shrinking

British startups are abandoning public stockmarkets and turning to deep-pocketed Silicon Valley venture capitalists for their investment needs.
8 Nov 2019
Visit/511212/reasons-for-investors-to-be-bearish-but-stick-with-the-stockmarket-bulls
Stockmarkets

There are lots of reasons to be bearish – but you should stick with the bulls

There are plenty of reasons to be gloomy about the stockmarkets. But the trend remains up, says Dominic Frisby. And you don’t want to bet against the …
17 Jul 2019
Visit/510684/good-news-on-jobs-scares-stockmarkets
Economy

Good news on jobs scares US stockmarkets

June brought the best monthly US jobs growth of the year, but stockmarkets were not best pleased.
11 Jul 2019

Most Popular

Visit/investments/property/601081/three-things-matter-for-the-uk-housing-market-now-and
Property

Three things matter for the UK housing market now – and “location” isn’t one of them

The UK housing market is frozen. And when it does eventually thaw out, the traditional factors that drive prices will no longer apply. The day of reck…
1 Apr 2020
Visit/investments/stockmarkets/601101/has-the-stockmarket-hit-rock-bottom-yet
Stockmarkets

Has the stockmarket hit rock bottom yet?

The world's stockmarkets continue on their wild and disorientating rollercoaster ride. Investors are still gripped by fear. So, asks John Stepek, have…
2 Apr 2020
Visit/investments/property/601065/what-does-the-coronavirus-crisis-mean-for-uk-house-prices
Property

What does the coronavirus crisis mean for UK house prices?

With the whole country in lockdown, the UK property market is closed for business. John Stepek looks at what that means for UK house prices, housebuil…
27 Mar 2020
Visit/investments/commodities/energy/oil/601107/oil-shoots-higher-have-we-seen-the-bottom-for-the-big-oil
Oil

Oil shoots higher – have we seen the bottom for the big oil companies?

Just a few days ago everyone was worried about negative oil prices. Now, the market has turned upwards. John Stepek explains what’s behind the rise an…
3 Apr 2020