John At The Center

BillShrink, the startup that helps users cut costs on their phone bills, is expanding its automated advisor to an entirely new field: Credit Cards. The site’s recommendation engine will now include a database of over 200 major credit cards, helping users choose an ideal card after entering only a few basic cr

So now Wall Street consolidates. Should you care? Not even for an instant. I spent 20+ years on Wall Street, competing against scores and scores of firms, always wondering what they all really did. E.F. Hutton. Shearson, Drexel. Heck, I even worked for PaineWebber in my early days (daze?) on the Street. All gone. And nobody misses them.

The true money-makers all find jobs elsewhere. The worker bees in the middle tier see disruption, but are eventually absorbed into the reconstructed Wall Street. The bottom tier goes to work at Foot Locker.

Hedge funds are taking over more and more of the asset management and trading business. Technology is taking over more and more of the sales and clearing businesses. The brokerage business is being redefined, rebuilt, and reorganized.

Expensify, the startup that took second place at TC50’s DemoPit, is hoping to ameliorate these issues as much as possible by keeping track of your expenses for you. CEO David Barrett says that while solutions exist for the top

To use Expensify, you first sign up for an “electronic payment card” – essentially an Expensify-branded MasterCard that is linked to your original credit card. This electronic payment card is acting as a middle man, tabulating all of your purchases on the road and immediately charging your original

Either way, Glocer argued that terminals “are only part of the story” and that the company is doing more business in what he called plumbing for the enterprise : “The data feeds that come into the basement at 85 Broad st”. 85 Broad is the address of Goldman Sachs HQ.

Financial info site BankRate is expanding its financial product listings, as it’s acquiring Bankaholic, which provides info on deposits, savings accounts, and money market accounts. The company will pay $12.4 million up front, with another $2.5 million possible earnout over the next 12 months. Bankaholic’s sole employee John Wu will assist in the transition and remain for an unspecified period of time. BankRate, of course, is exposed to some of the nastier aspects of the economy, though it’s held up fairly well and continued to grow. It’s also made acquisitions in order to diversify its range of financial products—last December it acquired Savingforcollege.com and Nationwide Card Services for at least $29 million. The company has also seen competition from TheStreet (NSDQ: TSCM), which acquired BankingMyWay, a much smaller site with a similar service. A conference call will be held at 4:30 PM ET (details in the Release).

We’ve had some bad days lately, and it turns out Bear Stearns, Lehman Brothers and maybe some others bet far too much. Their quants didn’t save them.

I called some old timers in the risk-management world to see what went wrong.

In fact, most Wall Street computer models radically underestimated the risk of the complex mortgage securities, they said. That is partly because the level of financial distress is “the equivalent of the 100-year flood,” in the words of Leslie Rahl, the president of Capital Market Risk Advisors, a consulting firm.

With this in mind, Microsoft’s interest in what’s known as high-performance computing (HPC) makes a lot of sense. The world’s largest software maker this week released a new, specialized version of its Windows operating system built to distribute tasks across large groups of computers.

StockTwits.com, a Twitter- and Tumblr-powered financial bulletin board, has closed an angel round of financing. The site skims Twitter for messages people tag with stock symbols — $GOOG for Google, for instance — and aggregates them on a Tumblr site with stock charts, tags, and comments.

StockTwit’s investors include Wallstrip founder Howard Lindzon and Roger Ehrenberg — both investors in Silicon Alley Media, this site’s parent company — as well as Mytrade.com founders Andy and Landon Swan. Betaworks, the NYC-based “business acceleration platform”/incubator-that-hates-the-word-incubator, is also involved in the venture.

Here’s what a StockTwit looks like on their site:

Nonetheless he now calculates that shares have fallen so far that if you buy a basket of “high quality” U.S. stocks today and hold them for about seven years, you’ll probably end up making about a 50% profit – after inflation. Stocks that even Jeremy Grantham likes come pretty well recommended even in a financial crisis. His top “high quality” picks are Microsoft, Johnson & Johnson, Pfizer, Wal-Mart, Exxon Mobil, Coca-Cola, PepsiCo, Chevron, UnitedHealth Group, Procter & Gamble, QUALCOMM, Oracle, Merck, Home Depot, and Cisco Systems. (It sort of looks like a typical “Large Cap” fund without the financial stocks.)

http://online.wsj.com/article/SB122170224429850803.html

A mere four years ago, semi-automated trading was the preserve of quant-fund geeks, but now, algos are everywhere. When the NYSE adopted the tools this summer, the last opponent to electronic trading had signed up. This week, the NYSE was “frenetic,” said a veteran floor broker, with episodes of “unbelievable stress.” During the crazy openings, the broker said he leaned on algos, because they allowed him to “be in 15 places at once.” By plugging order requirements on quieter stocks into his computer, the broker found he could concentrate his open-outcry energy on the stocks expected to have a boisterous opening.

There are risks with depending too heavily on algos: One was exposed by the UAL Corp. fiasco last week, when a five-year-old story about its bankruptcy was accidentally republished. The selling that took place may have triggered some algos to automatically sell. That’s why most traders warn against a Ron Popeilesque “set it and forget it” strategy.