21 Finance, insurance, and real estate

As financial markets have become more sophisticated in their models and services and more highly automated with computer-based trading, physicists came into (relatively) high demand because of their analytical and computational skills. Books have even been written about the overlap between finance and physics and, more generally, about the employment of “quants” to develop sophisticated financial instruments. Beyond this high-profile work, where can physics intersect with the abstract but essential world of financial transactions? At the level of individual consumers, physical devices such as credit-card scanners, chip readers, and encrypted wireless exchanges are central to everyday payments. At larger level of bank loans and investment, physicists help with the due-diligence process of examining the true capabilities and consequent value of a business whose primary assets are sophisticated technologies. Similarly, in the realm of insurance and real-estate, physicists could provide objective assessment of structural assets and of failures: famously, Richard Feynman was adamant about paying attention to physical realities in the investigation of the Space Shuttle Challenger disaster. Other aspects of evaluation, such as surveying on the ground and using drones, can employ physical devices and methods of data analysis.

At a completely different level of financing – and arguably one that is vastly more important – how can physicists work with others to conjoin clever technical design with equally clever pathways to ownership to help bring nutrition, material well-being, health, and security to vast portions of the human population whose income may be only a dollar per day? We are living in a time when monetary wealth has become extremely concentrated and automation of production and office services has displaced large numbers of workers; at the same time, communications technology has become widely distributed, so that the global population is all-too-aware of inequities. Can thoughtful and compassionate development of physical devices and processes be a democratizing influence that prepares us for a better world in which a thriving life is the achievable expectation of all people?