Featured Guests:

Greg Trompeter - Director, Kenneth G. Dixon School of Accounting

Melanie Fernandez - Partner, BDO

Paul Gregg - Assistant Chair, Finance Executive in Residence, Dept. of Finance; CFO, Rini Technologies, Inc.

Jim Adamczyk - Senior Executive VP / CLO, FAIRWINDS Credit Union

Mike Johnson - Dean, UCF College of Sciences

Episode Transcription:

 

Paul Jarley:                         This is a story of a man who was ahead of his time. Some say that he had the most important idea of the last 500 years. He may very well have helped to invent the future. He most certainly understood the role trust plays in our modern economy. And he was of all things, a mild mannered accounting professor.

Paul Jarley:                         This show is all about separating hype from fundamental change. I'm Paul Jarley, Dean of the College of Business here at UCF. I've got lots of questions. To get answers, I'm talking to people with interesting insights into the future of business. Have you ever wondered, "Is this really a thing?". On to our show. [music]`

Paul Jarley:                         A few months ago, I received an email from Mike Johnson. Mike is Dean of the College of Sciences and more importantly, my drinking buddy. The subject line read, Innovations in Accounting. Who knew? I opened the email and clicked on the link to an article entitled, "Why Everyone Missed the Most Important Invention of the Last 500 Years". I was skimming the article when Greg Trompeter walked into my office. Greg is the director of the Dixon School of Accounting, and so I turned to him and said, "Hey Greg, have you ever heard of triple entry bookkeeping?"

Greg Trompeter:              (laughs). Triple entry bookkeeping.

Paul Jarley:                         Indeed he had.

Greg Trompeter:              It's an idea that came up, maybe in the mid to late 1970s. There was a professor at Carnegie Mellon. His name is Yuji Ijiri and he came up with a notion that for four or five hundred years people had been using double entry bookkeeping as if it were perfection itself. He said, "Well, maybe you could make it better".

Paul Jarley:                         Okay, let's stop right there. I realize a podcast in accounting theory is a bold move. But Dr. Ijiri was quite the dude. His obituary notes he was interested in things like the relationship between accounting, quantum physics, and quantum computing. How many people do you think are trying to connect those dots? He didn't strike me as the kind of guy who would waste his time on frivolous pursuits.

Yuji Ijiri:                               Bookkeeping evolved from single entry, which just recorded what happened, to a double entry, where what happened has to be explained by reasoning.

Paul Jarley:                         Dr. Ijiri might be dead, but in the miracle of today's modern technology, he left behind a YouTube video explaining his ideas around triple entry bookkeeping.

Yuji Ijiri:                               I get attracted by three. Everything three is very interesting and much more complex than two. And what the triple entry might look like.

Paul Jarley:                         He challenged a group of Ph.D. students to figure this out. 10 years lapsed, when he realized...

Yuji Ijiri:                               Nobody is doing anything about it. (laughs).

Paul Jarley:                         So he decided to take matters into his own hands. Yuji wrote two books on the subject. The second of which...

Yuji Ijiri:                               bases on the calculus of taking a type of derivative of existing accounting and come up with a new dimension and then create the double entry at that level. I think it has a lot of applications...

Paul Jarley:                         I know that seems esoteric, but Dr. Ijiri's ideas might just rock your world. As Greg explains, changes in accounting facilitated changes in markets and significantly impacted the geographic scope of trade.

Paul Jarley:                         A brief history lesson...

Greg Trompeter:              The Sumerians, I believe, invented single entry bookkeeping. So describe single entry bookkeeping for me.

Paul Jarley:                         Basically keeping track of my cash. It was really simple. At the end of the day, you sort of balanced out your cash.

Greg Trompeter:              That would have been single entry bookkeeping. And it had a problem with...there could be errors that wouldn't be caught. And there was less accountability. It was really difficult to check on any assets or any liabilities you have other than cash.

Paul Jarley:                         So your single entry accountant, was probably a relative.

Greg Trompeter:              Yeah. And the ventures you were involved in were probably very local.

Paul Jarley:                         It wasn't just the that boundaries of trade were expanding. Owners started hiring managers to run the business on their behalf.

Greg Trompeter:              Somebody other than the manager is the owner. So you had this agency problem where the owners have to have the ability to trust the managers and so trust becomes a bigger issue, enterprises get larger, it's easier to screw up the books. So double entry bookkeeping did a couple of things. At the simplest level, double entry bookkeeping made it so that debits had to equal credits, assets had to equal liabilities plus owners' equity. So at the end of the day, there was an internal check on the accuracy of the records.

Greg Trompeter:              But perhaps more importantly, it gave you better controls.

Paul Jarley:                         [music] The first book on double entry bookkeeping was published in 1494. A lot has happened since then. Publicly held companies came along, auditors followed. Their job is to make sure what is being reported actually happened. And that investors aren't being duped. Government regulations followed, lots of them. 500 years later, double entry bookkeeping still rules. It's been a remarkable run that's facilitated trust in our financial network. But it's an inherently backwards system.

M. Fernandez: Everything is looked at historically.

Paul Jarley:                         Listen to Melanie Fernandez, a partner at BDO and a College of Business Hall of Fame member.

M. Fernandez: That's probably the biggest complaint that I get as an auditor, is, can't you have more real time information that is reliable and has been certified.

Paul Jarley:                         Dr. Ijiri thought he could help by introducing calculus notions into accounting, what he calls, momentum accounting.

Greg Trompeter:              He argued that assets and liabilities is where we are today, owners' equity is the accumulation of where the company has come from in the past. And the third entry force, he called it, would be tied to how we were doing in the future. So if you think about his financial statements that would come out from the triple entry, you would have a balance sheet, which is at a point in time: this is assets, liabilities and owners’ equity. Then you have the income statement, which sort of explains using cool accounting, how we get from one balance sheet to the next balance sheet. So the income statement is sort of like the first difference.

Paul Jarley:                         Right.

Greg Trompeter:              Then his notion of momentum, forced acceleration, taking us more into the world of calculus and physics, was sort of why last year's income was different from this year's income. Much the same way the income statement explains why last year's balance sheet was different from this year's balance sheet.

Paul Jarley:                         Which might be of more interest to a financial investor.

Greg Trompeter:              Absolutely. One of Ijiri's points was that investors ... if in fact the statement just showed that the momentum was this year's income is $30 bigger than last year's income, you can do that easily enough. But if the bookkeeping system actually tracked why it was different, and we could see sales were up in part because it was an increase in prices, partly because it was an increase in volume. That would actually be useful information to an investor, to see why are profits up? And to highlight that on the face of the financial statement.

Paul Jarley:                         Sorry for the accounting lesson. It will pay off later when our story takes a sharp turn. Stay with me people. My next stop is Paul Gregg.

Paul Jarley:                         So Paul, would momentum accounting help investors, or can they get that information by other means.

Paul Gregg:                        They know some of it.

Paul Jarley:                         Paul is an executive in residence in our finance department. He has a wealth of experience and currently serves as CFO of Rini Technologies.

Paul Gregg:                        So let's take Apple. Apple discloses in their 10K the unit sales of things like iPhones and iPods. And so one could track those, but the question is, what are they going to be in the future? And then one could say, well let's take Microsoft as an example of where we were all buying our first pc and they had an extremely high growth rate. That ultimately leveled off. That's typically what happens to big corporations that they may go through periods of extreme growth, and then they level off. And when you're trying to figure out what those future sales and earnings and cash flows will be, the question is how long will they grow at hyper growth and at what point will they level off. That's where, using calculus and other regression tools could help one in saying, well what would be the case for the iPhone compared to the case for Microsoft and what would that predict by way of when Apple's growth will start leveling off becau

Featured Guests:

Danny White - UCF Athletic Director

Richard Lapchick - Director, DeVos Sports Business Management Program

Ben Noel - Executive Director, Florida Interactive Entertainment Academy

Tony Schiller - Executive Vice President and Partner, Paragon Marketing Group

Abiel Payano - President, UCF Gaming Knights

Episode Transcription:

 

Paul Jarley: You remember that, right? Well, video games have come a long way since then. It’s no longer just guys playing in their moms’ basements. Now teams play in their own arenas. They’re ranked in coach’s polls, have television contracts and even their own sneakers. 380 million people say they are fans. The China championship sold 80,000 tickets in one minute. Your son or daughter likely has a favorite team. Danny White and Dale Whittaker would do well to help the UCF Gaming Knights be part of this global phenomenon. The college experience is changing my friends, welcome to e-sports.

This show is all about separating hype from fundamental change. I’m Paul Jarley, dean of the College of Business here at UCF. I’ve got lots of questions. To get answers, I’m talking to people with interesting insights into to the future of business. Have you ever wondered, is this really a thing? Onto our show…

Danny White: We feel strongly that we have every right to claim the national championship and that’s why we’re doing it.

Shaquem Griffin: You know, the only things we can do is win games and we won all of them. If you want to put one more in front of us, we’ll probably win that one too.

Jarley: Yes, we’re the self-proclaimed national champions of college football. And unless you’ve in a closet for the last six months, you know Shaquem Griffin’s story. It was a great year to be a UCF Knight. But I sometimes wonder if college football isn’t really the last war. Maybe the next war is e-sports.

E-sports? Listen in. No that’s not a crowd reacting to a Justin Upton homer. It’s Justin Wong making an epic comeback in a game of Street Fighter in 2004. Ask any 16-year-old boy about e-sports, and whether UCF should field a team, and you get an answer like this.

Spencer: It’s a great idea, honestly, I’d watch it.

Jarley: Trust me that’s Spencer being excited. He’s a man of few words and in fairness to him, I was interrupting his game of Fortnite, so I kept my interrogation short.

Jarley Interviewing: And how much would you pay to go to an event?

Spencer: However much it would take I guess, how much they would charge.

Jarley: I needed to get up to speed on this whole e-sports thing. So I went to visit Ben Noel. Ben is a former EA Sports executive and currently heads up UCF’s Florida Interactive Entertainment Academy. That’s our nationally renowned video gaming program in Downtown Orlando.

Jarley Interviewing: So Ben, I know you’ve been in the gaming industry for quite a while. What is e-sports?

Noel: Well e-sports is short for electronic sports and it was basically, you’re playing competitive gaming.

Jarley: Calling video games sports? Now I know what you’re thinking, “that’s kind of a stretch.” But Ben says that the level of skill and teamwork actually makes the two kind of similar.

Noel: It’s usually team based and it’s online and it’s usually played globally. And it never really became big until we had the internet that could allow for such things.

Jarley: Big is an understatement

Schiller: Globally there’s over 380 million that self-identify as e-sport fans.

Jarley: Listen to Tony Schiller, Executive Vice President and Partner at Paragon Marketing Group

Schiller: We help big brands like Gatorade, PNC Bank, and Yokohama Tires and many, many more. We help big banks engage with their target audience and it’s all about the affinity that the target audience has. It’s mind blowing. You know, there are events at the United Center of Chicago, at Madison Square Garden in New York, the Staples Center in Los Angeles that go on sale, e-sports tournaments and they go on sale, and within half an hour, hour or two hours they are sold out clean. And that’s 20,000 people paying money to watch a few people down at center court basically, playing a video game.

Jarley: 20,000 tickets ain’t nothing. Listen to Rich Lapchick, Director of the DeVos Sports Business Management program here at UCF.

Lapchick: Eighty thousand tickets were sold to the China championship in one minute.

Jarley: And then there’s this nugget from Mike Redlick, Director of External Affairs for the DeVos program

Redlick: The athletic shoe companies are now coming out with actual gaming shoes for players. They have their own specific type of shoe.

Jarley: Yes they do, K-Swiss is designing a pair of sneakers for an e-sports team called The Immortals. You can expect them to be on shelves and display in December for the bargain price of $110 a pair. I don’t need anymore evidence than this, e-sports is definitely a thing. But that doesn’t mean it’s a college thing.

Should colleges nurture this? Should it become a varsity sport? Should the NCAA get involved? It was time to get a students view. So I searched out the president of the UCF Gaming Knights, Abiel Payano to get his take on this.

Jarley interviewing: Thanks for doing this…we’ll try to make it painless.

Payano: Thank you for having me.

Jarley: Abiel is a student majoring in psychology here at UCF. His Gaming Knights has about 120 dues paying members. Making it one of the largest student organizations on campus.

Jarley interviewing: Suppose someone came up to you and said, “we want to recruit you to the UCF e-sports team that is going to play in the American athletic conference just like the football and basketball team do and we’re offering scholarship money for you.” Would you take that deal? Do you think e-sports is going to go that way?

Payano: I think it very much has the potential. Florida itself is a little behind on that note, for e-sports. But if we were to get that offer, we would definitely try to take that offer, if possible, because scholarships are a goal for collegiate e-sports.

Jarley interviewing: So you can imagine a day when maybe in addition to football team and a basketball team, we have an e-sports team.

Payano: Yeah, very much. If you look at examples like, I believe its Oklahoma State, they have an e-sports arena built for them already.

Jarley: He’s right, we’re behind. More than 70 universities offer scholarships to the varsity e-sports teams. Even campus libraries are giving way to e-sports. Boise State for example has cleared 3,000 square feet of its library and devoted it to its e-sports team.

And then there’s the Big 10.

Audio: Hello and welcome to the second broadcast of the 2017 Big 10 network League of Legends.

Jarley: The Big 10 fielded a competition among all 14 schools that was broadcast on the Big 10 Network and gave out 500 thousand dollars in scholarship money. So why aren’t we trying to get into the League of Legends top 25 coach’s poll right now? Well, e-sports has issues.

Issue one, violent games with fickle fan bases, Tony Schiller

Tony: A lot of these games are shooter games and that should be something that the NCAA and universities contemplate very deeply. Relative to is this something we want to be a part of? Introducing violence within e-sports into our campuses. If you know e-sports a game like Fortnite, which is at mass hysteria levels now, and I don’t mean to denigrate the game but in a year or two Fortnite may not be the game anymore. So, does the NCAA utilize one game? Does the game constantly evolve? And there’s different publishers who are part of the NCAA pool.

Jarley: Abiel on the other hand, thinks that’s all manageable.

Payano: I’ll use the Smash series as an example. Melee has been out since 2001. It’s been 17 years and people are still playing that game and it still has an insane amount of following. There are active tournaments and there are major tournaments every other week practically.

Jarley: Issue 2

Audio: *Rage, yelling and profanity*

Jarley: Yeah, that…Ben Noel.

Noel: When they go online and go on to these environments its like their own fight club. They can smack talk and use inappropriate language that they wouldn’t use in a classroom.

Jarley: Abiel agrees but he knows gamers can be self-regulated.

Payano: We’ve had to deal with our own toxicity in sportsmanship within our events. For example we use to have a bad relationship with the CSGO community, that’s Counter Strike: Global Offensive. We had an issue with them during a tournament where they were yelling at each other from across the room and that doesn’t help an open casual event flow properly. It doesn’t feel great. It wasn’t fun to be there. So we had to talk to them and then we didn’t host tournaments for them for a bit as a form of punishment or just negligence. But now we’ve reconnected and they’re one of our e-sports team.

Jarley: Issue 3: It’s a bunch of white guys playing in their mom’s basement. Rich Lapchick.

Lapchick: The concept of e-sports is a team sport, if you don’t play together as a team you’re not going to win. So depending on who’s on the team, if it’s five white guys, the power of the huddle is going to be limited to that. It’s going to draw them together and make them closer, but when I talk about the power of the huddle, my concern is about what people look like, where they are from, what they believe, and coming together in that huddle. And at this stage, although there are a fair number of people of color playing e-sports I’m told that that’s not really an issue, especially globally.

Jarley: But Abiel says that things are changing.

Payano: Most of our teams, if it’s a team of six, they’ll have one or two females participating on that team, just because they’re the best.

Jarley: Issue 4 PEDs. The suppliers don’t just juice the participants, they sponsor the events....

Featured Guests:

Stefanie Hill - Career Coach, UCF College of Business Office of Professional Development

Lina Pabon - Campus Talent Acquisition Business Partner, ADP

"Ellen" - Student

"Casper" - Student

Vera - Robot Interviewer

Episode Transcription:

 

Paul Jarley:                         Russian hackers aren't just messing with our elections, they're disrupting the job application process, too. Companies like IKEA and Pepsi are hoping artificial intelligence will help cut hiring costs, but all this new technology may just be leading to more incivility in the job market. Prepare to be ghosted, my friends.

Paul Jarley:                         This show is all about separating hype from fundamental change. I'm Paul Jarley, dean of the College of Business here at UCF. I've got lots of questions. To get answers, I'm talking to people with interesting insights into the future of business. Have you ever wondered, "Is this really a thing?" On to our show.

Paul Jarley:                         To a graduating senior, the job market can be a scary place. If you think a 4% unemployment rate has eased these concerns, think again. Just pray that this horror story doesn't happen to you.

“Ellen”:                                I got three interviews. I did all of them and I got called back for one from a local firm. I went to the second interview. They told me that, it was maybe on a Monday, and they told me they would reach out to me again by Friday. They even gave me the employment paperwork, and then they never reached out to me ever again.

Paul Jarley:                         Let's just call her "Ellen." But an incident like this?

“Ellen”:                                Nothing. Just completely ghosted me.

Paul Jarley:                         It's a bit of shock to the ego.

“Ellen”:                                I figured that if they didn't want me, they would at least tell me they didn't want me.

Paul Jarley:                         What has that experience done to you?

“Ellen”:                                It was really frustrating because I put a lot into preparing for it. I was really excited about it. It's discouraging.

Paul Jarley:                         Discouraging, but hardly new.

Stefanie Hill:                     I think with technology, there are so many platforms now and, depending on the business, you're not paying for every single platform.

Paul Jarley:                         That's Stefanie Hill, a Career Coach in our Office of Professional Development. She's explaining how greater use of technology in the applicant screening process is leading to more ghosting by employers.

Stefanie Hill:                     An applicant tracking system is what employers use to track all of the applicants that come through and apply on their website. If you're using that ATS, that's great, but you have to drive traffic to you website, which a lot of employers don't pay for extra marketing to do that. You're gonna go on CareerBuilder, you're gonna go on Indeed. If your organization doesn't shell out thousands of dollars to pay for these different platforms, then they're not communicating with your ATS. In that instance, you're going on three different platforms. You would have to send rejection letters to all three different platforms, depending on who applied on which, and a lot of times with all of those applicants it's hard for employers and recruiters, especially, to keep track of all of that

Paul Jarley:                         It's just too much work to contact everybody.

Stefanie Hill:                     I believe so. I also think it depends on the means of how you're communicating with somebody.

Paul Jarley:                         Sometimes when the employer calls, no one's home. Given the pressures of time, the employer just moves on.

Stefanie Hill:                     If you're doing that through a phone call or voicemail, nobody really checks their voicemail. They don't clear their inbox for their voicemail. You can't leave a voicemail. Why spend multiple times trying one person when five other people answered your first phone call? I also think that has to do with it, is really the timing around that. If you're a recruiter, you need to meet numbers. If you're not doing that quick enough, that's a problem.

Paul Jarley:                         Laziness, rudeness, and time pressures do have their costs, though.

Lina Pabon:                        Never ever again. That tells me something.

Paul Jarley:                         That's Lina Pabon, a Recruiter with ADP.

Lina Pabon:                        We're one of the largest human capital management companies in the United States.

Paul Jarley:                         She would never work for a company that ghosts applicants.

Lina Pabon:                        I would never. Even if I had a friend who was interviewing or something, I would even be like, "Well, that was my experience with them?" Just as an FYI. It's definitely a negative thing, especially at the level I was at. You're telling me I'm moving to a second round, and then I never hear back. That's not professional on their end.

Paul Jarley:                         But it's not just the initial screening process that's becoming automated. Meet Vera.

Vera:                                     Hello. My name is Vera. Thanks for your time.

Paul Jarley:                         She's a robo-interviewer developed by a Russian company who works for both IKEA and Pepsi. I sat down for an interview with her.

Vera:                                     Are you ready?

Paul Jarley:                         Yes.

Vera:                                     Alright. For a start, tell me how do you grow the net promoter score of your accounts.

Paul Jarley:                         I hire smart people like Josh Miranda, who does these things for me.

Vera:                                     And by the way, what was the best customer service you have ever received?

Paul Jarley:                         I had a tailor who once measured me one day in my hotel room and delivered me three suits the next day.

Vera:                                     Hm. Me, too. Now, please, define the word "leadership" in one sentence, just without using the word "lead."

Paul Jarley:                         It's the ability to articulate a vision that motivates other people.

Vera:                                     Hm. Brilliant. I enjoyed our talk. I will get in touch with you by email by the end of this week. Have a prosperous day ahead.

Paul Jarley:                         Vera winked at me twice during the interview, but I don't think we made a deep personal connection. I honestly don't think she's calling me back. Perhaps that lack of a personal touch leads to things like this.

“Casper”:                            My first urge is to ghost.

Paul Jarley:                         That's another UCF student. Let's call him "Casper." In Casper's experience, impersonal recruiting practices have led to cyber stalking and make some companies seem illegitimate.

“Casper”:                            On LinkedIn, you get just the most bizarre messages. You don't have a very private account 'cause you're trying to get that exposure. You get the startups and the questionable ventures that are like, "Oh, yeah, we'd love to have you!"

Paul Jarley:                         "Hi, we're a pyramid scheme, would you like to join us?"

“Casper”:                            Yeah, yeah, exactly, exactly. I had a recruiter contact me saying, "Entrepreneur is looking for me to report to the CEO." I mean, I'm flattered, but I just graduated with my accounting degree. Those things don't add up. I'm suspicious. Whenever you just know it's not really worth your time, it's easy to just pass up on it.

Paul Jarley:                         How about a more reputable ...

“Casper”:                            More reputable ones. My first urge, a lot of times- For example, on my LinkedIn, on my header it says, "I'm looking for public accounting in this market. I graduated here." I would get offers on LinkedIn like, "Hey, we want to interview for this management training role in Orlando starting summer." You just got all three of the things in my header wrong, so I had the urge to just ghost them because you're not really paying attention to who you're reaching out to.

Paul Jarley:                         Have you ever ghosted someone after they actually called you for an interview?

“Casper”:                            Just that recruiter for the one where they want me to be a controller. It wasn't really worth my time. I mean, I had asked a couple more followup questions and the answers were not as through and through as I would have liked. I just kind of let it go.

Paul Jarley:                         Pay attention, employers. As Stefanie notes, Casper's story is hardly unique.

Stefanie Hill:                     Applicants ghost for the purpose of, "I'm applying to a ton of jobs and you're getting phone calls and you're not answering those phone calls for whatever reason." Definitely in the initial process when a company reaches out through phone screen, we've also seen seVeral students that my have gotten hired with a company. They're expected to be in training or they're currently in the organization and all of a sudden, they fall off the face of the Earth.

Paul Jarley:                         I'd really like to revoke their degrees.

Stefanie Hill:                     I think a big thing with that and why students are doing that, not necessarily students but just about everybody is doing that, is not only the competition, you may have just taken a job for the sake of taking it, but you like something better.

Paul Jarley:                         Casper adds:

...

Featured Guests:

Sean Snaith - Director, UCF Institute for Economic Competitiveness

Honghui Chen - Director, Master of Science (M.S.) FinTech Initiative at UCF

Jim Balaschak - Principal, Deanja, LLC

Mike O'Donnell - Executive Director, UCF Center for Innovation & Entrepreneurship

Alexander Golding - Founder and CEO, HelpedHope; Bitcoin Investor

David Metcalf - Senior Researcher and Director, Mixed Emerging Technology Integration Lab (METIL), Institute for Simulation & Training

Jim Adamczyk - Senior Executive VP / CLO, Fairwinds Credit Union

Episode Transcription:

 

Paul Jarley:                         This episode has bank robbers, bitcoin, blockchain, and bacon. Maybe those are the four Bs of Fintech? As it turns out, not all of them are a thing.

Paul Jarley:                         This show is all about separating hype from fundamental change. I'm Paul Jarley, dean of the College of Business here at UCF. I've got lots of questions. To get answers, I'm talking to people with interesting insights into the future of business. Have you ever wondered, "Is this really a thing?" Onto our show.

Paul Jarley:                         I have a murky past. I paid my way through graduate school by teaching macro and micro economics to inmates in a federal penitentiary. How I got that gig is a story for another day. Suffice to say, it's not easy to get into a facility like that. Most of my students were drug dealers, counterfeiters, or tax evaders. My best student was a bank robber.

Paul Jarley:                         When I first heard of bitcoin and its alleged underworld origins I thought, "Yeah. Government's gonna shut that down right away. It's not going to be a thing." Some South American countries like Bolivia and Ecuador have shut down bitcoin; many countries in the Muslim world have too.

Paul Jarley:                         Countries like China have made it difficult to trade, others like India and Canada have safeguards that keep it out of its banking system. But, here in the United States bitcoin is legal. Why? To answer that question I went to my resident hater of all government regulation.

Paul Jarley:                         Well, that's a little harsh. He's the director of the UCF Institute of Economic Competitiveness, Dr. Sean Snaith.

Paul Jarley:                         Hey, Sean. Got a couple of questions for you.

Sean Snaith:                       All right.

Paul Jarley:                         Sean is one of the most recognized people at UCF and his office is just down the hall from mine.

Paul Jarley:                         Why are cryptocurrencies like bitcoin legal? Doesn't government have a monopoly on money production?

Sean Snaith:                       They do. The thing is, with bitcoin and other cryptocurrencies they really haven't infringed greatly on the role of money as the medium of exchange that is official government money.

Paul Jarley:                         It's not really legal tender is what you're telling me?

Sean Snaith:                       No. I can't be forced to accept bitcoin in payment. Now, if I was willing to, then we do see transactions where bitcoins functioning as the medium of exchange. But, it's not widespread and that's why I think the government is not sort of clamping down on bitcoin in a forceful way.

Sean Snaith:                       It's not taking revenue away from the government that the government accumulates by being able to create money, which is a significant amount.

Paul Jarley:                         But, what about using bitcoin on a day-to-day basis?

Honghui Chen:                  From the time it started, initiated to it really is completely verified is an hour of wait time.

Paul Jarley:                         That's Honghui Chen, UCF finance professor and leader of our emerging Fintech program. Hong is explaining that your typical bitcoin transaction takes about an hour to process; too long to pay for gas at the pump or your groceries in the checkout line.

Paul Jarley:                         He goes on to note that bitcoin has other draw backs as a medium of exchange, especially for small transactions.

Honghui Chen:                  The transaction cost is too high, because the cost to recall a transaction ... doesn't matter whether it's one bitcoin or a Satoshi. Right?

Paul Jarley:                         By the way, a Satoshi is named after the alleged founder of bitcoin. It's the smallest unit of bitcoin, it's 100 millionth of a single bitcoin.

Honghui Chen:                  It's the same record, same amount of work. I think maybe in the future if it happens it will be for large transactions, not for small transactions.

Paul Jarley:                         I just don't see bitcoin becoming such a common medium of exchange that it's going to worry the US treasury or the Federal Reserve. It's more likely to be a niche product reserved for very large transactions, but even here price volatility may limit its usefulness.

Honghui Chen:                  There's huge volatility. Another thing is people's willingness, of business willingness and individuals' willingness to accept bitcoin as payment.

Paul Jarley:                         Case in point, over drinks the other day two of my friends talked about the guy who mowed their lawn. He had worked for a person a few years back who had paid him in bitcoin, he later cashed that bitcoin into the tune of 250 thousand dollars.

Paul Jarley:                         Those turned out to be really expensive lawns to mow. Imagine the windfall or loss that might come from a much larger transaction, but where there is price volatility there is also speculation. I sought out a few of my investor friends to ask them what they think of bitcoin and whether they held any as part of their investment portfolio.

Jim Balaschak:                   Well, bitcoin is highly speculative.

Paul Jarley:                         That's Jim Balaschak, principle at Deanja LLC and a hall of fame member. Jim's not buying bitcoin.

Jim Balaschak:                   I think that it's been driven up by a lot of people just following the trend and there's no real, underlying earnings factor. No PE, no forward growth that you can measure, and I think that just makes it too speculative to me.

Paul Jarley:                         Is there another kind of crypto currency that you prefer that you think is a worthy investment of one kind or another because it's backed by something? Could you give me just some sense of what that is?

Jim Balaschak:                   I haven't really looked at detailed ... There was one that came out from Oscar Mayer a few weeks ago called "Bacoin", backed by bacon. That seemed to at least have something-

Paul Jarley:                         Like, linked to the commodity market for pork?

Jim Balaschak:                   I think just linked to ... I think it was just really a promotion thing.

Paul Jarley:                         Now, bitcoin backed by bacon. That's something I can get behind, but Jim's main point is that without something tangible backing bitcoin it's just too speculative for his blood.

Paul Jarley:                         My friend Mike O’Donnell on the other hand does invest in bitcoin. Mike, like Jim, is a member of our college of business hall of fame and is a serious investor.

Paul Jarley:                         Mike, why invest in bitcoin? Why not just invest in gold? It seems like a lot of work.

Mike O’Donnell:              Well, the reason I invested in it really was because there was a guy who was one of the original people in Facebook and a really smart guy. I think the longest executive and he's now maybe one of the top experts if not the top expert in the world in cryptocurrency.

Mike O’Donnell:              He said it took him 18 months to understand it and he said, "I don't know for sure ..." Because, nobody does, "Whether or not it's gonna succeed or not succeed, but I'm recommending that anybody with wealth invest 1% of their assets in this asset class." Because, it had a high potential for a massively high return in these early stages.

Paul Jarley:                         Mike's willing to devote a tiny part of his portfolio to a speculative investment and let it ride. He's not worried about whether people can predict day-to-day or even annual fluctuations in price, but other people like David Metcalf are.

David Metcalf:                  There's been two [inaudible 00:06:47] that I've watched.

Paul Jarley:                         David is a senior researcher for the institute of simulation and training here at UCF.

David Metcalf:                  Of course, just general supply and demand and hype being put on something like Gartner's Hype Curve and kind of see where it falls in the now. But, the other thing that I've watched closely is when there's been currency destabilization.

David Metcalf:                  Like right after Cyprus and right after the austerity movements in Greece where there was flight of capital. Safe places for some people to put and store their wealth, versus the fee at currency. That was one of the main uses for other cryptocurrencies.

Paul Jarley:                         In this sense, cryptocurrency may act a lot like gold, which is also seen as a hedge against currency risk. This flight to safety is also emphasized by Alexander Golding, a serial entrepreneur and thought leader on crypto currency and social enterprise.

Alex Golding:                    A safety play, I definitely see that. I think that the 10% daily price range we see here in bitcoin is much less than the devaluation of the Zimbabwean dollar or the Venezuelan bolivar or some other currencies.

Alex Golding:                    Furthermore, in terms of how do we measure and devaluate the price of bitcoin?...

"Is This Really a Thing?" is an all new podcast created and hosted by Paul Jarley, dean of the College of Business at the University of Central Florida. With the help of local experts, enthusiasts and all-around interesting people, Paul takes a look at up-and-coming concepts and ideas that have the potential to reshape the business landscape.

How do you separate fly-by-night management tactics or money pits from legitimate innovations? What will students need to learn about to be successful over the next decade? Is Bitcoin a thing? How about eSports?

Paul decided to chase down the answers to these questions that keep him up at night and pose the question... Is This Really a Thing?

Coming to your favorite podcast app in mid-September.