Back to List

What We’re Reading This Week

Robo Advisors

Robots and investing has quickly become a regular topic in this blog. Mostly because there are a lot of articles about it, but also because it gives me a fair amount of smug satisfaction to read about colossal missteps as large companies try to replace people with machines.

I know two things about robots and automation: (1) people are (historically) very bad at determining what will be done by a robot in the future; and (2) I will never be replaced by a robot. I know these two ideas seem to be at odds with one another but hear me out. There is one area of commerce in which robots cannot compete— when there are complex decisions involved and high levels of human emotion. My cup runneth over with human emotion and complex decisions. It really has nothing to do with robots being capable of doing these things; human nature won’t allow it. People just don’t trust machines to do it well.

That being said, there are two types of jobs for machines in this industry. Back office and front office. By all means, give the back office jobs to robots. This will only free up time for back office personnel to work on more complex tasks. The front office jobs can’t really be done by a computer. UBS is working on putting robots in both roles.

The back office robot “saves time by doing a task that would normally take a person about 45 minutes in only about two minutes, while freeing investment bankers up for other tasks, such as calling clients.”

The front office robot, not so much. “UBS claims it is the first ‘adaptive strategy’ product offered by an investment bank. It has been marketing the offering to clients for a couple of months and they have been ‘very receptive.’ While the bank is yet to convince a client to put its money into it, it expects to secure its first contract within a few months.”


T.J. Maxx

While I don’t write about retail often, it will always have a dear place in my heart. My career started in retail and the best way to explain my affection is Stockholm Syndrome. Still, every now and then I have to check in on industries that are dying. I think of clothing stores the same way I think of brick and mortar banks; my grandkids will not know what they are. In the same way that I have to explain to my children what a travel agent was, my kids will tell their children what a Macy’s was.

As online retailers like Amazon gain popularity, traditional merchandisers are losing market share. T.J. Maxx is an exception to this rule and has been seeing an increase in sales for the past 33 quarters. The article focuses on business strategy and the changing market environment in retail. However, I think the answer is a little more obvious. There are two types of shoppers, people that want it to be easy and people that want a bargain. Put differently, there are people that value their own time and people that, well, don’t. Actually, I would argue that stores like T.J. Maxx actually appeal to people that have an aggressive need to waste their own time.

I’ve been to a T.J. Maxx. You can tell that someone organized the store once but it’s really hard to tell how long ago that was. It looks like a regular store but after some type of earthquake or something. I

think this is really key though to the store’s success. The internet has made it very easy to find exactly what you want. Once that mission is accomplished, the next hurdle is getting that thing to you as quickly as possible. Amazon Prime is a great example of that endeavor. They offer free two-day shipping for members. Eventually, everything will just be sent overnight. The problem is that there is a subset of the population that does not want to trade time for money. Some people don’t feel truly validated as a shopper unless they spend a tremendous amount of time searching for a bargain. The longer they look and the more time they invest, the greater the bargain’s value. T.J. Maxx has harnessed this need and turned shopping into a “treasure hunt.” Of course the only way to test this theory would be for large companies to start hiding their merchandise and turn shopping into a game. If that ever happens I would consider returning to retail, but only if I could be Chief Officer of Hiding Things. That sounds like a fun job.



Gainplan LLC is a Registered Investment Adviser. This blog is solely for informational purposes and not a solicitation to invest. Advisory services are only offered to clients or prospective clients where Gainplan LLC and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Gainplan LLC unless a client service agreement is in place. Please contact a financial advisory professional before making any investment.

Gainplan LLC provides links for your convenience to websites produced by other providers or industry related material. Accessing websites through links directs you away from our website. Gainplan LLC is not responsible for errors or omissions in the material on third party websites, and does not necessarily approve of or endorse the information provided. Users who gain access to third party websites may be subject to the copyright and other restrictions on use imposed by those providers and assume responsibility and risk from use of those websites.

Categories: Careers, Industry Ideas, News

Subscribe to Our Blog