What the National Insurance tax increase could mean for your finances
For those who just see it listed on their pay slip, but are not sure what it is, National Insurance...
One hundred years ago, the idea of almost everyone you know owning their own personal motor vehicle would have seemed outrageous. Today, Henry Ford’s infamous “if I had asked people what they wanted, they would have said faster horses” is a mantra for inventors the world over.
Fifty years ago, the idea that most people would swipe a small plastic card across a machine in a shop to buy their groceries would have likewise been unimaginable. Last year, Visa’s global networks processed US$5.8 trillion in payments1.
Twenty years ago, anyone who said humans would one day walk around with tiny computers in their pockets from which they could access any information and contact any person, any time they wanted, almost anywhere on the planet, would probably have been laughed at. Investors who bought into Apple even ten years’ ago in 2007 have seen share price gains of around 1000% since that point2.
For tech investors, these kinds of success stories can be irresistible. But technology can also be a sure-fire way to destroy wealth – as anyone who invested at the top of the dot com bubble will tell you. Even if you turn out to be right about the potential of a particular technology, you must also pick the right company that has the right skills and resources to bring the technology to market, and the business acumen to make a profit.
A new report from Rathbones looks at key technology developments happening in three major industries and asks the question: where do the investment risks and opportunities lie?
A big window of opportunity in health care, as Rathbones sees it, is ‘personalised medicine’. What does this mean? Put simply, it is medicine designed for each and every individual. Instead of going to the doctor and getting prescribed a standard pack of pills, you would be given a treatment that is unique to your DNA ‘genetic barcode’. ‘Gene mapping’, as the process is known, may have many other health care benefits too. It could allow for far earlier diagnosis of conditions, as well as more efficient research and development when finding cures. For insurers, in particular, the potential cost savings that may come from patients receiving more efficient health care could drastically reduce payout volumes.
Where does the technology factor in? The key challenge to overcome in making this vision a reality is the storage and analysis of enormous quantities of patient data. According to Rathbones, a file containing genetic data for just a single human is around one terabyte. Cloud computing may assist with storage, but the power required to process the data will be huge.
While renewable energy sources have been used for some time now, cost has long been a factor in keeping the more traditional oil, gas and coal popular. Furthermore, the idea that sources such as wind and sun are somewhat unpredictable has meant they couldn’t be relied upon without at least some sort of fossil fuel assistance. What has changed? Battery storage technology has significantly advanced. Batteries are now cheaper, lighter and far more powerful.
For the car industry, this has obvious implications and you only have to stroll the streets of some European cities to glimpse into the future: rows of electric vehicles plugged into communal chargers, ready for rent. Meanwhile, as more and more homes (and businesses) have the ability to go ‘off grid’ by storing enough solar power to fulfil almost all of their power needs, utility companies will need to restructure and/or offer additional services if they want to maintain their relevance.
Blockchain. The financial disruption ‘buzzword’ of the moment, and initially built as the platform for storing and transferring the Bitcoin currency, blockchain has the ability to far transcend its original purpose and shake up the technologies that underpin much of the financial ecosystem. It essentially provides a platform for transacting without an intermediary, from one individual or peer directly to another. So, if you owe your friend money, you can pay them electronically without a using a bank, for example.
Consultancies are falling over themselves to release reports of how much money this could save consumers over the next decade, although of course regulations and security concerns could slow things down. Blockchain has the potential to positively impact lots of other areas too, though – not just financial transactions. It could also facilitate far greater sharing of data in the health care industry, in logistical and supply chain businesses, and in music payments and licensing to name a few. It could also herald the beginning of governments switching to online voting, for example.
1 Annual Report 2016, Visa, 2016 financial year, ending 30/09/2016 2 Google Finance, NASDAQ:AAPL, 20/04/2007–20/04/2017