Barbara C. Matthews

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Anyone who hoped that 2020’s dramatics were over is now disappointed. The first working week of 2021 was a doozy. Markets may have taken last week in stride, but a range of simmering issues — some technical, some potentially dramatic — promise that headline risk will soon drive volatility again.

Savvy investors know that the quiet market days provide breathing room for serious scenario analysis and strategic positioning. The first step to conquering headline risk is to recognize that a problem exists.

Stated simply, most analysts conflate two related but analytically distinct risks: policy risk and political risk. This post…

Active policy formation processes provide excellent examples of how alternative data sourced from the public policy process can deliver material informational advantages to early adopters. Technical policy processes increase informational asymmetries because most media outlets will not cover complicated new developments.

Monday’s flurry of LIBOR-related policy activity in the end encompassed ten policymakers in Asia, Europe and the United States. The scale and scope of activity suggests strongly that initiatives were coordinated. Media coverage only addressed about 30% of the activity underway this week.

©2020 BCMstrategy, Inc. |

PolicyScope Platform users on Monday morning saw the start of global wave using our alternative data…

The steady year-long momentum increase in sovereign digital currencies — interrupted only by COVID-19 — continues to intensify.

As the time series data from our PolicyScope Platform indicates on the left, policymakers are making up for lost time in the spring with a stream of speeches and actions that illustrate they are serious about issuing electronic currencies.

Between Friday and Monday, the competition among central banks intensified considerably, no doubt spurred by the influential SIBOS conference underway right now,

Today’s Dramas: China and the European Union

Sequentially, the European Union acted first.

The European Central Bank (ECB) released on Friday a dense, technocratic, and technical report paired…

Throughout 2019 and 2020, we have periodically pointed out to blog readers and PolicyScope Risk Monitor readers how policymakers have been steadily, incrementally, and subtly expanding the regulatory perimeter to cover cryptocurrency markets and issuers. We have pointed out to our Medium readers as well, particularly in March 2020 and April 2020.

This week and this morning, the PolicyScope Platform has been registering increased activity and more concrete initiatives emanating from Europe, with our risk measurements pointing directly at increased regulation.

©2020 BCMstrategy, Inc. | |

Momentum measurements lit up like a Christmas tree two days ago

By Barbara C. Matthews on The Capital

During July, the Bank for International Settlements (BIS) released a report recommending a range of mechanisms to improve data gathering concerning FinTech companies. Most people yawned and moved on to more exciting issues, like 5G regulation or the geopolitical struggle between China and the United States.

However, the report provides important forward indicators of policy trajectories. The form, structure, and focus of the planned enhancements to official sector data gathering also provide a roadmap to where FinTech firms can expect to see increased policy engagement over the next 12–18 months.

Background: FinTech Policy Dynamics So Far This Year

© 2020 BCMstrategy, Inc. | |

Policymakers started the year seeking to establish a solid foundation…

First, we need to thank the European Central Bank (ECB) for its action earlier today. They have helped prove a point we have been making for quite some time.

Earlier this month, on July 7, we published a White Paper regarding LIBOR Reform. In that paper, we noted that the risk measurement and risk management challenges are both daunting and unique for a specific reason:

Download the White Paper

“The LIBOR transition is unique in recent history because policymakers are requiring market participants to shift towards standards that are not yet fully developed. Final regulatory and other policy specifications cannot be generated until sufficient…

When operating at the tail of the distribution, scenario analysis can be extremely helpful in identifying vulnerabilities. As we noted earlier this week, applying scenario analysis effectively to the growing number of public policy risks embedded in portfolios requires risk managers and quantitative analysts

© 2020 BCMstrategy, Inc. |

to stop approaching scenario analysis as a random, event-based exogenous event (Misconception 2)

Today’s research release from the European Central Bank (ECB) — discovered via our PolicyScope Platform — impacts profoundly how central banks and markets will communicate with each other in the near future. But to understand its significance, we need to provide a bit of background regarding both monetary policy formation and how advanced technology is changing the process of reading/cognition.

Monetary Policy/Forward Guidance 101

It is no mystery that market expectations and monetary policy have a symbiotic relationship. It is also no mystery that market dynamics can take on a life of their own, regardless of underlying “fundamentals.”

Data-driven investors (and their algos) make…

Last week, explained why the pandemic creates a “when bad data happens to good models” situation. To catch up, see: Two Data Deficits and Why Data Deficits Matter. We also de-bunked the misconception that scenario analysis when applied to public policy risks is not the equivalent of playing darts.

Today, we de-bunk the misconception about event risk… is NOT a random variable, particularly when applied to public policy risks.

Event Risk 101

In the capital markets, “event risk” is defined as follows:

The risk that the ability of an issuer to make interest and principal payments will change because of rare, discontinuous, and…

At the start of March, just before the COVID-19 lockdown, our company closed a seed investment round. We had no revenue, no customers. We did (and still have) a fully issued patent and a disruptive approach to delivering the data revolution to the policy intelligence arena. We did (and still have) a range of competitors that are much better funded and much larger.

And yet we managed to exit the first phase of the pandemic with

  • monthly recurring revenue
  • traction towards some strategic goals
  • increased attention to our B2B product and
  • the beginnings of a serious marketing funnel.

It seems…

Barbara C. Matthews

Quantifying cross-border policy risk using patented tech Founder & CEO #Data #NLP #geopolitics #DigitalCurrency #PredictiveAnalytics

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