Twenty Third Floor

Figuring out the future and the now

Category: news

Actuarial and Risk, economics, financial risk, hedging, insurance, investments, life insurance, market risk, news

There goes the long end

18 March 2009

David Kirk

The Fed joins Bank of England and Bank of Japan in repurchasing government bonds. photo credit: amber.kennedy This actions (quantitative easing) increases the prices of bonds (more demand, diminishing supply) pushing down long-term yields. Great if you own bonds, not so great if you are an insurer with imperfectly matched long-term liabilities. Given how difficult…
Read more: There goes the long end
news

New look, same beer

7 March 2009

David Kirk

I can’t remember whether it was Castle or Lion, local South African beers that had the marketing disaster of New Coke. South African Breweries (before the Miller transaction) updated the label on the beer only to see sales plummet. They even engaged in an advertisign campaign with the specific message that “the beer hasn’t changed,…
Read more: New look, same beer
competition, creating value, data analysis, distribution, economics, marketing, measurement, news

How to spot competition

6 March 2009

David Kirk

photo credit: richardmasoner It’s been widely reported that the Competition Commission has been proving an alledged bicycle cartel. Retailers alledgedly agreed to increase prices to improve margins. This is not a strongly competitive market, which makes it quite an attractive market and good margins and profits should be available. photo credit: shareski VodacomÂ and Cell…
Read more: How to spot competition
competition, creating value, currency risk, distribution, economics, news

Chavez – economic terrorist

1 March 2009

David Kirk

photo credit: pablo/T Chavez is promising to take over rice processing plants in Venezuela because they have been refusing to sell rice at the price set by government. Hyperinflation is starting to show it’s head, as a function of government policies around money supply. The article I referenced claimed that that is the reason for…
Read more: Chavez – economic terrorist
creating value, customer value, news, operational risk, property

Rudie still trucking and ducking?

26 February 2009

David Kirk

photo credit: johnnyalive A reader has some news, potentially about Rudie Visagie and another Rudco-style plan. Neither I nor the reader are sure about the details yet, but the story sounds all-too-familar. I read your article on the web when i googled Rudy Visagie. How very interesting to note all concerns people are having about…
Read more: Rudie still trucking and ducking?
competition, creating value, customer value, economics, insight, market risk, marketing, measurement, news, optimisation

Profit margins on ice

19 February 2009

David Kirk

Profit margins are being squeezed by decreased spending power of consumers. That is true, but it is also not the full story. Competitive pressures, buyer and supplier power dictate sustainable margins in the medium to long term. photo credit: abooth202 Fin24.com has a story this morning around Shoprite’s results and pricing strategy going forward. The…
Read more: Profit margins on ice
economics, financial risk, investments, measurement, news, property

Or is this a property crash?

16 February 2009

David Kirk

It is entirely possible that I was too optimistic. For once. What I said was: Our house prices will decline further but (political meltdown excepted) I’d bet serious money that we won’t see these declines in 2009 or 2010. I was talking about the 12.4% decline in US house prices in 2008 and the areas…
Read more: Or is this a property crash?
financial risk, hedging, market risk, news, property, statistics

Now that’s a property crash

12 February 2009

David Kirk

CNN has a story on house price declines being at their highest in 30 years. Turns out the headline is misleading in two ways. Firstly it proclaims house prices at a 30-year low, which is fortunately not quite the reality. However, the largest decline in 30 years is still pretty shocking. The second item is…
Read more: Now that’s a property crash

About David Kirk

Featured Posts

The “Indemnity Trap”: Why Outdated Legal Models are Deferring the Promise of Parametric Insurance
by David Kirk
Parametric insurance is often marketed as the “clean” alternative to traditional risk transfer. The pitch is compelling: if a hurricane hits a specific GPS coordinate… Read more: The “Indemnity Trap”: Why Outdated Legal Models are Deferring the Promise of Parametric Insurance
The Complexities of Comparing SCR Cover Ratios Across Insurers
by David Kirk
In the insurance industry, we often use Solvency Capital Requirement (SCR) cover ratios as a key metric for comparing insurers’ financial strength. While these ratios… Read more: The Complexities of Comparing SCR Cover Ratios Across Insurers
One answer could be pet insurance
by David Kirk
I firmly believe major demographics shifts are going to have massive social, political, economic, financial market and commercial impacts in the coming decades. The balance… Read more: One answer could be pet insurance
A piece of the failure puzzle – decreasing insurer failure rates through Skilled Person Reviews
by David Kirk
Every failure hits policyholders’ savings or cover, impact their lives and their livelihoods. They destroys shareholder value and decrease confidence in the entire financial sector.… Read more: A piece of the failure puzzle – decreasing insurer failure rates through Skilled Person Reviews
How and why insurers fail
by David Kirk
I’ve been updating my presentation from 2021 on “How and Why Insurers Fail”. I now estimate the annual failure rate (or at least getting into… Read more: How and why insurers fail
The hidden dangers of opinion shopping and trusting good news.
by David Kirk
I had a recent discussion on the value of getting a second opinion. There’s the old line that “if you want five opinions, ask three… Read more: The hidden dangers of opinion shopping and trusting good news.
40,000
by David Kirk
40,000. That’s the ballpark figure I usually work with as the minimum number of micro insurance policies required for scale. The expenses of running even… Read more: 40,000

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