A summary of this week’s best articles. Follow us on Twitter (@INTRINSICINV) for similar ongoing posts and shares.

iPhone’s Toughest Rival in China Is WeChat, a Messaging App (Tripp Mickle and Alyssa Abkowitz, @trippmickle and @AlyssaAbkowitz, WSJ)

Creating a user’s ecosystem is powerful. WeChat was able to shift a user’s ecosystem from the mobile phone’s operating system to a single application. With WeChat, you can “message friends, pay restaurant bills, hail cabs, play games and stream videos […] [, and run] ‘mini programs.'” This shift moves the importance from the device to the app.

Gambling on the Dark Side of Nudges (Philip Newall, @pnewall, Behavioral Scientist)

When complexity is introduced, the seller is able to improve their margins because of the buyers behavioral and cognitive biases. This can be seen in gambling. Bookmakers use peoples inability to accurately calculate the probability of events to charge a higher premium and earn a greater return. But, this isn’t limited to gambling, it’s also present in the financial world (through subprime mortgage and structured finance products).

The Cult of the Line: It’s Not About the Merch (Ruth La Ferla, NYT)

Apple popularized the trend of long lines for product releases. After almost a decade of this behavior and other retailers following suit, its created a generation that is used to waiting in line. It’s even created a “new community.” “When 200 to 300 kids are lining up outside of a store, it’s because they want to be part of something.”

The Great Escape: How Credit Raters Ducked Reform (Sid Verma, @_SidVerma, Bloomberg)

Credit Rating Agencies (CRA) played a role in the financial crises. “‘This crisis could not have happened without the rating agencies,’ the Financial Crisis Inquiry Commission concluded in 2011.” Since the 1970’s CRA’s have received payment from the bond issuers. This large potential conflict of interest, which may have contributed to the lofty ratings of some banks before the financial crises, is still in place today.

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