Discovery log
Money20/20 week in Vegas keeps talking about open finance while the shutdown news cycle chews on missing data.
OC morning; telemetry map open; Fed transcripts and ADP statements stacked on the second monitor.
The shutdown proved voluntary feeds can vanish overnight, so this log captures the failure modes and the fixes we’re putting in place.
The shutdown did more than furlough agencies. It severed the Federal Reserve’s access to the payroll data Waller cited days earlier. That series flagged a cooling labor market. When ADP pulled its feed, policymakers cut rates with stale numbers. If the Fed can lose its preferred real-time series, any builder who leans on voluntary sharing is one vendor dispute away from flying blind.
What the Fed’s data blackout really means
- Monetary policy became reactive. The Fed cut to 3.75%-4% and promised an end to quantitative tightening. Powell still sounded hawkish because the team lost its high-frequency reads.
- Markets caught the disconnect. The second rate cut lifted the Nasdaq to a record close. Two-year yields jumped 10 bps. Traders trimmed the odds of another move in December from 90% to 67%.
- Alternative data is a privilege, not a right. ADP shared access as a goodwill gesture. The moment the data anchored a speech, the feed vanished. Expect more private vendors to set tight rules.
Why fintech and vertical banking should care
- Open banking is still voluntary. Treasury’s comment window is open, but aggregators can throttle access whenever incentives shift. Underwriting pipelines need buffers.
- “Skinny” master accounts are on the table. Waller’s teaser for a limited-purpose account signals that access will be governed, not improvised. Teams that show telemetry discipline earn trust.
- Healthcare finance needs redundancy. Practices already live with reimbursement lag and credentialing backlog. Clearinghouses can miss a file the same way ADP did.
The playbook I’m updating
- Dual-source critical feeds. Payroll, claims, and transaction data each get a primary and secondary path. If one shuts off, we degrade instead of freezing risk models.
- Expose data dependencies to partners. We document the vendors that feed our models and the outage script we will run. Sponsor banks, auditors, and clients see that work up front.
- Instrument latency, not just availability. The Fed did not spot the gap until decision day. We added alerts for stale files, delayed timestamps, and abnormal gaps in ACH or ERA data.
- Lobby with specifics. When I comment on open banking, I name the failure modes and the controls we fund today. Regulators respond to concrete mitigations, not slogans.
Where this goes next
The risk isn’t permanent loss. It’s the expectation that every builder can describe a fallback. Instant payments, private credit exposure, and AI-led underwriting lean on data we do not own.
If one vendor disappearing would cripple your ledger, this was your warning. I’m tightening our diagrams before a sponsor asks the same question. Healthcare fintech, dental banking, AI peers: happy to compare notes. OC or LA coffee works.