Category Archives: Law

March 2, 2015 · 23:39

Trolls are real

No, this is not an episode of Grimm, where we see the Hässlich as they collect their fee. This is not the case of David Giuntoli, beheading reapers and taking care of the trolls. This is today, the trolls are real and the fee goes up by hundreds of millions. This is the case of SMARTFLASH LLC, et al. v. APPLE, INC., et al. The article was from Cnet, but I got wind of it through EpicTimes. All this got to blows not because of the amount, but because this issue has been allowed to fester for well over two decades. The issue takes a legal leap into the unknown, which is still unmanaged at present. The questions that we have to pose is in two parts.

  1. Is this a festering scene?

You see, it is nice for Apple to cry wolf, but is it a valid scene of the crying?  The fact is that Smartflash LLC has 7 patents, the first one filed Oct 25, 2000, with a Foreign Application Priority date (UK) of Nov 25th 1999, and this makes it a patent that was filed before the initial release of Apple’s iTunes, which was January 9th, 2001.

The Apple response we see (at http://www.cnet.com/news/apple-ordered-to-pay-533-million-over-alleged-itunes-patent-infringement/)

“Smartflash makes no products, has no employees, creates no jobs, has no U.S. presence, and is exploiting our patent system to seek royalties for technology Apple invented. We refused to pay off this company for the ideas our employees spent years innovating and unfortunately we have been left with no choice but to take this fight up through the court system”, so let’s take a look at the slightly empty response as I see it:

‘Makes no products‘, is not a prerequisite for a patent;

‘Has no employees‘, is also not an issue, someone filed for this case and someone filed for a patent. Whether this is an employee is not an issue;

‘Exploiting our patent system to seek royalties for technology Apple invented‘, is slightly moot. The patent was filed before iTunes existed, hence, we could argue that Apple did not invent what they did, the latter statement is an incorrect one, but I will return to this.

Now let me rephrase the Apple statement in a very unflattering way: “Smartflash had an original idea, the idea was not novel because this is the direction the world was moving to”. This notion was a clear given ever since day two that Napster got active. The people understanding these technologies would innovate and come up with ideas. Unlike me, who  was a Patent Virgin in 1999 (and unaware of the power they hold) would see that the future is all about IP, so some of these people would file the ideas and they would stick. Now we see that Apple might have reinvented the wheel, but reinvention is no invention at all. It becomes a license and Smartflash LLC only had to wait for their chooks to grow and grow. Now pay day has arrived.

So as we go back to the initial part, questions come to mind. Questions many (including Apple) might not want an answer to, because the answer might be a lot scarier than we all imagine. You see, in previous blogs I discussed the dangers of a faltering and collapsing economy, because those in charge remained too flaccid to actually act on issues. The consequence is that if a monetary system collapses, what will replace it? In my view, the new currency for any corporation and government is Intellectual Property. If that is true, than those who own the property will become the new true wealth.

This makes Patrick Racz a visionary of massive fortune, if we see the first fee that Apple will end up paying, what will happen to the next step? What will the Samsung invoice become? Beyond that, Apple now has a choice to make, the entire DRM future is now no longer in the hands of the large industrials, so that coin will be making massive waves soon enough.

So where is the festering part? Well, Patent Trolls are not a new group. This ‘valid’ group has existed since the early 90’s. So over the last two decades, this groups had not been dealt with. The valid question becomes, should Patent Trolls be dealt with? You see, patents get bought all the time, someone goes bankrupt, the patent is bought, perhaps sold by a bank trying to limit its losses. This market evolved, because the issue as is, is that corporate ‘losses’ due to patent trolling has been exceeding 20 billion a year from 2010 onwards. So, why not act against trolling?

The question becomes is it wrong to be a troll? The Hässlich might disagree if we say yes. The fact is that those with the novel idea, might not have the means to pursue the real deal. So they might want to file their original idea. To give you an example, which you might not believe, is that I came up with the idea around 1994. Now, it could be seen as a DPod (Data Pod), my idea was not in that direction, you see. In my past I was confronted with the ‘joke’, that was known as a tape streamer. It was a backup solution that never properly worked in households. So I had the idea to make the Minidisc a backup device. To connect it to computers, so that we could copy files, the Minidisc looked like a 3.5″ floppy, but could hold hundreds of megabytes. It could have evolved the need for diskettes and it would have propelled data halve a decade earlier. I would have been decently wealthy. So, I should have patented the idea (although, in those days I did not realise I could). So as such, Patrick Racz was the clever one. Yet, in view of all this, did Apple lag? That becomes the cornerstone in all this. Does it matter? Is a more apt question. A patent was filed, Apple did not do its homework as I see it a cost comes into play.

So now we get a new issue, will Apple et al ‘force’ a change in patenting? Will capping be imposed? All decent questions that are for tomorrow. For today, Apple gets to admire its own armour, which is not as shiny as it was yesterday. I must however state, that I personally do not think that Apple did anything wrong. Now I return to the initial exploiting part I promised to revisit. They came up with an idea and they designed it. In 1370, a Dutchman named Laurens Janszoon Coster came up with an idea, it was the printing press. He came up with the idea around the same time Johannes Gensfleisch zur Laden zum Gutenberg came up with the same idea. They both had similar (not identical) ideas in a time when the need for a cheaper solution was needed. The Dutch and the Germans all state that their citizen discovered the idea, which is fair enough. I think that this is a similar situation. In all fairness it seems to me that the patent system did not allow for such a situation, it does not make it right or wrong, the situation just is. In a land (US) where it is all about number one, it must now bite that this patent is in hands of a non-American. So as we realise that any system is flawed, is it flawed enough? If patents are about innovation, are the little people the solution? I have always believed that true innovation will survive, big companies will need to consider the age old situation, having the person with the ‘nice’ PowerPoint, does not mean that they have the innovation.

  1. Is it unmanaged?

Like any legal system, the Patent system is good, but is it good enough? This one case is calling for visibility, but one case does not a change make. If we go back to 2013 we see the following in Forbes (at http://www.forbes.com/sites/toddhixon/2013/10/04/for-most-small-companies-patents-are-just-about-worthless/). “But, TechCo will need to use a lot of other technology to build and deliver a complete product, e.g., the product design might be protected by a patent, but the manufacturing process might be subject to another company’s “blocking” patent“. Here is the kicker, there has been a lot of noise on how large corporations have the ability to block others. If we accept Business Insider (at http://www.businessinsider.com.au/chart-of-the-day-the-totally-useless-patent-wars-2014-10) “In other words, based on patent cases brought to court by Apple, Samsung, Microsoft, Nokia, Motorola, and a host of others, litigation is, more often than not, a serious waste of time and money for all parties involved“. The question is, should the system change? Because these big boys are in disagreement, does not mean that the system should just fall away. Are these patent cases valid to begin with? If we look at the quote “As it turns out, only 20 or the 222 patent assertions (9%) were able to establish liability, but even in that small sample, only 10 of those 20 cases resulted in “lasting injunctive relief.” Mueller says that number would be even smaller if “the patents underlying Nokia’s German injunctions against HTC had come to judgment in the Federal Patent Court.”“. My question is that if the numbers are this skewed, why take it to court in the first place? What was the tactic behind it? Delay? A mere pissing contest or was this about satisfying the need for additional costs? I have no idea, but the result data speaks for itself. Is the score so impressive that pursuing a 10% chance is essential, worth the effort or it is something else?

I do not proclaim to have the answer, but the questions are not getting asked, moreover, the press at large have all quoted Apple on their ‘indignation’, but answer me this, how many papers gave any view, brought any decent quotes from Brad Caldwell apart from the one liner victory? In addition, when we see Reuters (at http://www.reuters.com/article/2015/02/25/us-ip-apple-verdict-idUSKBN0LT0E720150225), the quote “Apple, which said it would appeal, said the outcome was another reason reform was needed in the patent system to curb litigation by companies that don’t make products themselves“, that sounds nice in theory, but that leaves only the large companies in charge of it all, it takes out the small innovators whilst large corporations are left choking those small innovators for a mere tuppence to get complete control. Patents were never designed to give power to the manufacturers, they were an exclusive rights granted by a sovereign state to an inventor or assignee for a limited period of time in exchange for detailed public disclosure of an invention. However, as the world became all about shore term goals and iterative exploitation, in that regard patents are a massive impropriety to the need of large corporations.

Time will tell what direction the legal industry makes, for now, as Apple and Google are so about non tax accountability, the danger of actual change remains not too large (only for now).

 

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February 27, 2015 · 11:07

The not so neutral net

This time, it was the Epic Times (at http://www.epictimes.com/2015/02/how-do-you-feel-about-net-neutrality/), who gave me the goods). To be honest, I have stayed away from Net Neutrality for several reasons. The first one is, because for now I remain on the fence. Reasoning here is that we are not really ready for Net Neutrality.

On one side, the US starting this works out nice for the Commonwealth (mainly Canada), there is a decent chance that some companies will move to speedier shores. But, let me get ahead of it all, because that might help the entire issue. So here is the initial response I gave:

There is an overwhelming need to be against it. Judgement was not correctly passed here. I do not essentially oppose net neutrality, however, that can only occur if the internet is correctly addressed, which it is not.

You see, people think that they are now better off, but they will be contending for the same bandwidth with a few thousand spammers, who use an equal bandwidth to a few million users. By forcing all in equal opportunity, spammers, and marketeers. We see that in this ‘ruling’ “Broadband providers cannot block or speed up connections for a fee”, so your fee to block is now no longer an option, which might mean that you get to drown in spam. In equal measure, you cannot pay extra to speed up, which is not unfair, but when corporations are no longer given the speed, they will move to other shores, so if places like Equinix (to name but one of many) will move to Canadian shores, feel free to thank those for net neutrality for giving a few thousand jobs to your northern neighbours. A data centre is about revenue, and net neutrality is not evil, but it has setbacks, revenue being one of them.

the next part is in “Internet providers cannot strike deals with content firms, known as paid prioritisation, for smoother delivery of traffic to consumers”, so this will inflict massive damage, which means that high pressure connections like Oracle forms will not get a whole new issue, working from home could be impacted in new not so nice ways.

Yet the one part “The FCC won’t apply some sections of the new rules, including price controls”, which than implies that all people will end up paying for bandwidth, there we see the connection to rule one and rule two, if fees cannot be used for speeding up, and prioritization, we could speculate that there is one price, a business price for all, I feel certain that the Facebook family and Google Plus family will just love the new pricing for staying in the loop on a social media level, for if there is no priority control and no speed control, the only price control is one price, and it will be a charged one.

And this is only one side of it, net neutrality will never work when the people cannot be correctly protected from cyberbullies, cybercriminals and cyber hackers, for the mere reason that under these conditions, monitoring will become a lot harder, you see those special accounts also meant that they needed less monitoring, because the origin is known, which is why I personally opposed the view of the White house. They stated “Our pursuit of cybersecurity will not — I repeat, will not include — monitoring private sector networks or Internet traffic”, how? Consider yourself in the street, walking, the police is looking for a wanted criminal, now consider where you walk and EVERYONE is wearing exactly the same outfit, do you really think the police will have an easier time finding the culprit? Of course not, now they need to scan every person they pass, not just the person they were looking for in a Green Armani suit wearing purple loafers’ size 12. Good luck finding the right person.

There is a positive issue to net neutrality, there is no denying that, but until they have a way to find the extreme abusers of the net, the neutrality step will make it a lot harder, not easier.

So, you might disagree with me, which is always fair enough, so let’s get the ball rolling on a few parts, because, I have support, I am not the only one here.

They are the first example to use. The BBC (which does not stand for ‘British But Conservative’, at http://www.bbc.com/news/technology-31638528), had the following part: “”The internet is built on infrastructure. Even to keep at a steady state providers are going to have to invest in infrastructure but they need certainty that they can get a return on their investments,” said Mr Belcher” which is fair enough, however, if business is no longer investing as they do not get a premium speed, what do you think they will do, stay in the US, or move to Mejico where they revere speed, Ariba Ariba Andale Andale! And when business moves off-shore, where will your cheap provider remain? It will not, it will be pushed out of business fast, or people will have to pay an actual amount.

The next one we get from the Wall Street Journal (at http://www.wsj.com/articles/broadband-investors-should-wake-up-to-net-neutrality-heard-on-the-street-1424975993), here we see “The long-term bull case for cable relies on two main factors: The ability to grow market share of residential broadband and the ability to raise prices. The latter rests on the idea that broadband providers’ pricing power will increase over time, an assumption that could be called into question if the reclassification stands“, my issue, which I do no applaud is the premise on ‘the ability to raise prices’, it seems like a small thing, but do you think that 50.000.000 Americans will like the increase due to the loss of business as they find safer shores? Business relies on visibility, which means speed and priority, when those fall away, that loss must be paid for. There is no way to tell how much more, but it seems to me that an additional $5-$10 per week is not outside the realm of reality, did these net neutrality people figure on that part? I have called big business exploitative on more than one occasion, the other side is that their power was the speed at which they could move, take that away and you get the same need for exploitation, but from a place where they feel safe, they do not feel that in any neutral version of the net.

It is tech liberation that gives us another view on the dangers, issues that I did not completely consider. Not because I disagree, or because it is incorrect, but there is a hint of conspiracy theory here and I am not sure if that ride is one you should focus on, but I will not withhold it (at http://techliberation.com/2014/09/26/net-neutrality-and-the-dangers-of-title-ii/). It is not a new piece, it was written in September 2014, which gives us “As I’ve noted before, prioritized data can provide consumer benefits and stringent net neutrality rules would harm the development of new services on the horizon. Title II–in making the Internet more “neutral”–is anti-progress and is akin to putting the toothpaste back in the tube. The Internet has never been neutral, as computer scientist David Clark and others point out, and it’s getting less neutral all the time. VoIP phone service is already prioritized for millions of households. VoLTE will do the same for wireless phone customers“, you see, streaming services, bandwidth requiring services like Oracle Forms (one of many) are all about the proper priority. When that falls away, we get black-outs in data, which makes a system fall over, yet here we see another side, which seems to agree with the FCC. Most companies have VOIP, not an issue there. But VoLTE is another matter, Voice over LTE must be a monitoring nightmare to some. I am not talking about the intelligence branch (it worries them too), but about the Telco’s. Once we get free Wi-Fi AND free VoLTE, what will telecom companies be left with? When all your calls go across a simple Wi-Fi the game changes, I would think that roaming over free Wi-Fi using VoLTE is the best thing and traveling sales executive will ever face, now consider the Telecom companies with no more Roaming revenue, can you see the pain they would feel? So even if it is a valid view, is it a correct one? You see, I do not know, but I have seen Telco’s sweat blood because of the fear of denied ‘easy peasy revenue’, so there is my view in those matters.

The one missing part is where I wrote in regard to the cyber-illegality actions. In my view, Cyber-crime is hard to solve, most often it does not get solved, because the seekers were too late. Now consider that group and consider the additional delay because the hunters did not have to look in certain places, now that this part is gone, they will have to look everywhere, how will that help solve crimes? I now get back to a quote Fox News had: “No one disagrees that the Internet should be free and open. The president’s plan just does not accomplish that goal“. I agree with this, I will take it one step further, we all had free internet because business drive reachability and innovation (for reasons of greed mind you), when that drive is removed, it becomes a service for all (which is fine), but one that ALL have to pay for, so how did that oblige towards the goal of ‘free internet’? This will drive the need for stronger regulations in regards to ‘fairness’, which will than remove the term ‘open internet’ as well.

I am not against Net Neutrality, but until it is a global thing, which is actually globally ‘enforced’ (read accepted), Net Neutrality will only achieve in driving business to a place called elsewhere.

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February 17, 2015 · 22:34

When the offer is free

Try this for free! This is the commercial teaser we all see when we are offered a dozen of options. There is LinkedIn Premium, Spotify, Salesforce and the list goes on for a very long time. It is a way to get interested in a service or product. I myself tried ‘Today Calendar’ for free, than I upgraded, trials are to some extent a great solution. Try before you buy is a way to get into it. There are games that let you download their Demo, DLC’s that work for a week or two, then you decide, buy or fly!

It is an old marketing option that costs little and bring great reward for those employing the situation. There is however the detail. This we see in the article ‘Why are Amazon Prime customers angry?’ (at http://www.channel4.com/news/amazon-prime-charges-anger-customers-online). Several sources had the story, but Channel 4 read the clearest. The sub-line gives us the goods “Amazon defends a free trial of extra benefits, which ends in an automatic upgrade to paid membership costing £79 a year“. Amazon additionally responded with “Amazon says everyone who signs up to Prime gets an email telling them the duration of the free trial, how to avoid continuing to paid membership and how to cancel membership“. This seems clear enough. So when the guardian gave us ‘Giles Coren declares war on Amazon Prime over free trial‘ (at http://www.theguardian.com/money/2015/feb/16/giles-coren-declares-war-amazon-prime-free-trial-subscription), the impression was left with me that someone did not read their e-mail properly, now that person is crying wolf.

There is however another side to this debate. Should silent transfer be allowed, or should there be a mandatory change to an opt-in transfer? So, should the trial be auto cancelled after 30 days and in addition should we see a second confirmation after 30 days that the continuation is no longer free? This option is the one we usually see in software, when a trial is over, we see that the software no longer functions unless you start paying. On the other side we could consider that some consumers are too stupid to be allowed to have a credit card. The man considers himself an adult. He signed up for a trial, if we accept the response from Amazon that confirmation e-mails have been send, with the explanation on how to cancel it, he himself got into this scuffle by ignoring the message. The Guardian also shows another side that people seem to ignore. The two items involved is a tweet by Giles Coren “I mean, @amazon, offer a free trial in 2012, then quietly start charging £79 and never tell me. That’s what sicko porn sites do! I’ve heard“, so he has been charged for membership in 2012, 2013, 2014 and perhaps even 2015 and only now he ‘wakes up’? Now, this can happen, it has happened to many people, including me, yet 79 pounds is not a costs you easily oversee. To some it amounts to the 6 months fee from your internet provider, which should be taken into account. The second piece of information from Amazon is “Customers who sign up to a free trial of Prime receive an email informing them of the duration of the free trial and how to avoid continuing to pay Prime membership. Customers who become full Prime members can cancel their membership at any time and we will refund the full membership if the customer has not made any eligible purchases or used any Prime benefits“, which gives us the second part. So from that it would seem that Giles Coren must have used some of the services and now he is miffed on having paid for it. That conclusion I get from him not getting a refund, which means he had used the Amazon Prime services.

The article is not just an Amazon or an e-Commerce article. It is also an article that shows the unjustified demand of continued free services after the free trial ends. The two sides pulling on this are Amazon as well as pragmatic realism, as one Tweeter replied to Giles with “Shocking indictment of Oxford and private education as former student doesn’t understand the words ‘free trial’“, which pretty much sums up the ignorance people are showing when they accept free trial whilst not looking at the conditions. The one part I will also illuminate is the complaint we saw from a man called Richard Brown: “Regardless of the legality of the transaction and the stance that Amazon will take that it involves selection and a follow up email each year, the structure of this service is clearly designed to benefit from the customer’s lack of attention“. That too can be seen in two ways. I do agree with Richard on that Amazon should send a follow up e-mail on the subscription every year. These places can send you marketing mails until your hard drive has zero space left, but then shows a lack of ‘tenacity’ to inform their ‘customers’ via e-mail on the payment made, which I see should be a mandatory act in the first place (perhaps that happened, but no one mentioned it in any of the articles I saw).

It is the second statement from Richard Brown that bothers me “this service is clearly designed to benefit from the customer’s lack of attention”, not whether that is the case or not, but in regards to the consideration. This reminds me of the initial marketing when we saw the presentation from Microsoft on the launch of Windows 95. The slogan was ‘without even thinking‘, it was brilliant to some extent. Windows 95 was the first step towards people and true intuitive use of computers. Now, many (pretty much most users) are using their devices intuitive, but there is the added part we see that is at the core, marketing is all about getting a foothold, now we see part that implies (emphasize implies), is that consumers are either getting dim (not that unheard an idea), or that we are faced with two new elements, the first is ‘intuitive buying‘ and ‘intuitive marketing‘, the second one is the holy grail of achieving revenue. When used correctly it is seen as ‘Achieving influence without persuasion‘, there is an interesting article (at http://intuitiveconsumer.com/blog/intuitive-marketing-achieving-influence-without-persuasion/ ). It talks about the six mechanisms of influence used by intuitive marketing. They are ‘Trust: Intuitive marketing builds trust and relies on trust‘, ‘Consistency: Intuitive marketing is consistent and therefore communicates reliability‘, ‘Fluency: Intuitive marketing is easy on the mind‘, ‘Emotional reward: At the opposite end of the spectrum from high aspiration is the realm of small emotional rewards‘ and there are the final two ‘Aspiration‘ and ‘Aligned intent‘. As you see (especially after you read the linked article), the Amazon Prime situation seems to address 4 of the 6 elements of intuitive marketing, so when we see the Amazon Prime issue, is there deception? I personally say no! Amazon offered an agreement, one that gives you a cool down period of 30 days. The definition can be seen as “offer, acceptance, and consideration (payment or performance), based on specific terms“, this is what is at the heart of it all. The emotional response of Giles Coren with the reference to ‘that’s what sicko porn sites do!‘ which in my view holds no value, yet ‘the structure of this service is clearly designed to benefit from the customer’s lack of attention‘, the mention by Richard Brown is much better and decently more apt, but is it valid? ‘Lack of attention’ sounds nice for sure, but does that make the consumer less responsible? Especially when Amazon offers, “Customers who become full Prime members can cancel their membership at any time and we will refund the full membership if the customer has not made any eligible purchases or used any Prime benefits“, which is a decent counter offer, which was part of their offer as I see it. So first, the person gets a 30 day cool down and if the person has not used the service at all, they could get a refund. It seems to me that Amazon offers a decent service, so why do these events cause such a strong reaction?

The part I have not touched upon is ‘intuitive buying’. One vendor had this little slogan with their product ‘intuitive buying just like in an internet shop’. Now we get back to the initial Windows 95 slogan, this gives us in the end ‘buying without even thinking’. So we have a complete picture, but what neither article skates on is when will we see the accountability of the consumer. The person who was given a credit card, an adult who was supposed to be of sound state of mind. The person buying, was notified and then did not react. Intuitive buying does not make a person unaccountable, is that what the articles are steering to? No matter how many complaints we see, the clear indication is given that Amazon gave up front and it allows for correction in hindsight.

Hidden under this is the issue, not on the side of Amazon, but on our side, we consumers need to consider the clear truth that nothing is free! Should any internet offer be treated the same way trial software is? That remains valid, but if so, is that because consumers are no longer to be considered ‘adult’ or accountable, or is it because of another path of reasoning?

 

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February 15, 2015 · 23:09

A coin with more than two sides

Let us take a look at two of many more sides. The first side is given in this article: Google’s Vint Cerf warns of ‘digital Dark Age’ (at http://www.bbc.com/news/science-environment-31450389). The initial quote is “Vint Cerf, a ‘father of the internet’, says he is worried that all the images and documents we have been saving on computers will eventually be lost“. This sounds nice, but is that not the same as we have had forever? If we did not take care of our old photographs and our old negatives, than those pictures would be lost forever, so how is that different?

110mm_Agfa

See here, the picture of an Agfa Instamatic. It is almost identical to the camera I had in the late 70’s. So, how will you get those negatives developed? Where to buy film? Most will not care about it, many have bought new camera’s, but where to print the negatives you have? Nowadays with digital images, almost any printer will print it, almost every system will show them. How is that different? So are the words of Vint Cerf anything else but a sales pitch for some new ‘forever’ saved option, likely one that Google will offer and not unlikely in a way that gives Google shared ownership. Is that under the current feelings of ‘data collection’ such a sceptical view to have?

Now, I will state, that not unlike those old prints, the owner has the responsibility to keep the images safe, just like in the old days. Even if the originals (the digital negatives) are lost, as long as a print still exists, the image remains, just like the old photographs. Yet, his quote “But as technology moves on, they risk being lost in the wake of an accelerating digital revolution” holds truth, because that is not unlike the 110mm film issue. So as long as you have a data option that survives, like the 110mm negative holder, you can always get another print. So, CDROM’s in a writable version came in the late 90’s, so we only started to have a backup option for 20 years, yet affordable digital images would still need several more years. Yes, that market has grown exponential and now, we see the application of Common Cyber Sense in another way. Now, people will get confronted with the need to back things up. As the Digital disc evolved, so has the quality of these solutions. Now the discs last a lot longer, so backing up the old discs on new discs does make a whole lot of sense, so there is a side that makes perfect sense, but is that enough?

That part is shown in the following quote: “’I worry a great deal about that,’ Mr Cerf told me. ’You and I are experiencing things like this. Old formats of documents that we’ve created or presentations may not be readable by the latest version of the software because backwards compatibility is not always guaranteed’“. This is at the heart of what Vincent Serf is getting to, so he is definitely onto something. How many of you can still access all the WordPerfect files you created in 1992? Who can still access their FRED applications and their Ashton Tate’s Framework solutions? That list is slowly and surely getting close to zero. This is what Vincent is getting to and there list the crux, because this would have gone beyond mere images and what we currently still access. Consider the Digital VAX/VMS systems, the collected data that spans decades from 1982 onwards. The IBM series one (those 64Mb mainframes with 10 9” floppies), so Vincent is perfectly correct (as a man with his experience would be), but what solution to use? Yes, his idea is perfectly sound, but the issues that follows is the one that I have to some degree an issue with, you see, sometimes things get lost, which has happened throughout history, would our lives have been better if the Library of Alexandria survived? Would it be better, or would there be more and more incriminations? There is no way to know, but the issue can be explained in another way. This is a myth I heard in school a long time ago. The story is that a person could ask whatever he wanted for a created chess game. He asked for a grain in the first square, two in the second square and so on. By the time the board was half way through, the person paying for it would owe the person 2,147,483,648 grain seeds and that is just half way through. Now think of today’s world, where we collect everything. Like the chess board we collect every part and this just increased the junk we collect and that at a premium price. So what to keep? That is the hard part, it is interesting to keep on the side that sometimes we need to allow to lose things, but Vincent has a case. Now we look at one of the last quotes: “’Plainly not,’ Vint Cerf laughed. ‘But I think it is amusing to imagine that it is the year 3000 and you’ve done a Google search. The X-ray snapshot we are trying to capture should be transportable from one place to another. So, I should be able to move it from the Google cloud to some other cloud, or move it into a machine I have’“. Yes, there is the sales pitch. “Google search” and “move it from the Google cloud“, so there we have it, the Google cloud! Still, even though there is a sales pitch in here, does that make it a bad approach? Are we better because we save EVERYTHING? That is at the heart of this little conundrum. Now, those having their data on the old Cray might consider their data worthy, so do many who had their data on UNIX mini’s, but now consider every Novell edition, every desktop, now, it will be arbitrary if people decide to take these steps, yet what happens when all data can be baked up like this, what happens when some start ‘offering’ this for ‘free’? Who then co-owns that data, those solutions? Is that such a crazy thought to have?

Here is the last part: “And that’s the key issue here – how do I ensure in the distant future that the standards are still known, and I can still interpret this carefully constructed X-ray snapshot?” This is the part that is interesting; his concept of Digital Vellum is an interesting one. Yet, how should we move forward on that? What happens when these snapshots link up, when they connect, perhaps even interact? There is no way of knowing; perhaps this would be the beginning of a new evolution of data. Is that such a weird concept? Perhaps that is where we need to look at other sides too. Consider our insight, into our memories, our ‘wisdom’ and our ability to filter and extrapolate. Is this solution a primal step from near ‘artificial-intelligence’ to possible cyber/digital intelligence? The question becomes, if intelligence is grown from memories, what do we create when we give it everything we ever collected? I have seen the stories, the way some people think that the dangers of an artificial intelligence is so dangerous. We might consider the thoughts from the ‘Cyberdyne’ stories (Terminator series), but in the end, what if the digital intelligence is the beginning of our legacy? What if we learn to preserve ourselves, without leaving a carbon footprint, without being the deadly blight on nature? At some point we will stop to exist, we die; it is a simple consequence of nature, but what happened, if our wisdom is preserved? Many come with stories and nightmares of the loss of identity, but what happens if we can store intelligence? What happens if the next century Albert Einstein would be there to help us create progress, inspire innovation for all time? Is that such a bad thing? Some of these questions are beyond my ability to answer but there is a dangerous dark side too, what happens when this becomes commercial Intellectual Property? I am all for IP, yet, should cloned intelligence become the property of anyone? I feel that I might be alive long enough to actually see that question go to court. I hope that those making that decision are a lot wiser than I currently feel.

This now gets me to story two, which also came from the BBC (at http://www.bbc.com/news/technology-31440978), the story here is ‘Cybersecurity: Tech firms urged to share data with US‘, which gave me the initial scepticism regarding the Vint Cerf story. So, I am not linking them perse, they are separate stories. The initial quote is “Private tech firms should share more information with government and with each other to tackle cybercrime, according to US President Barack Obama“, I do not disagree with this thought, however, there is a side to this that is not addressed. The given quote is “Senior Google, Yahoo and Facebook executives turned down invitations to the summit, held at Stanford University“, so is this about not sharing, or about keeping the data non-sharable. There is part that we see when we look at the quote “Mr Obama is backing the creation of information sharing and analysis organisations (ISAOs) to help firms and government share material on potential threats“, yes, if we consider that Snowden fellow there could be issue, but is that a valid path? You see, consider how some do NOT want the cyber threat to reduce for the largest extent, consider how many software ‘solutions’ are out there, for viruses, phishing attacks, identity theft and several other parts. There are two dangers, at one part we have a possible solution to theoretically start solving and decently diminish the danger, the other side is on how all that data gets linked, that part in the wrong hands is a lot more dangerous than many could imagine.

The following quote adds to the worry: “Government cannot do this alone. But the fact is that the private sector can’t do it alone either because its government that often has the latest information on new threats” My issue is that this should not in the hands of any private part, it could be seen as the execution of the premise ‘absolute power corrupts absolutely’, those who face that lesson will not have an option. I would see a solution if there was collaboration between NSA, GCHQ, DGSE and a select few more. Reasoning? Cybercrimes have a distinct impact on national income and also national tax donations. They have all the drive to get it resolved. I have less faith in private companies, their allegiance is to profit, their board of directors and more profit. This is the issue as they will do what they need, someone falls on a sword and many get extremely wealthy, the data goes everywhere and many become exploitable, classifiable and re-sellable. I have been in data for decades, I think that governments can do what needs to be done, and it is time to change the cycle of re-iterated profit. Governments have made themselves the bitch of the private industries, the three mentioned initially is not enough, consider the quote down the line “Facebook, Yahoo, Google and Microsoft have all sent less senior executives to the conference“, so why was Microsoft not mentioned earlier? What is going on? The interesting part is that Bloomberg mentions Microsoft several times, the BBC article just twice. It is clear that something needs to be done on several levels, but it takes a different scope and a different approach, I feel decently certain that keeping the private touch out of this will be essential, for the reason that private companies have a mere commercial scope. I feel uncertain that this approach will work, it has not worked for a long time; I have seen ego and political play and personal reasoning interfere with results, in more than one nation. Whatever is done, it needs to be done, it needs to be done a lot faster than many consider and even though taking the politician out of a government seems to be impossible, we need to make sure that an approach is considered that does not allow for political exploitation, but how to get that done is another matter entirely.

 

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February 12, 2015 · 21:30

Supporting exploitation

This time, there is a different issue in play, this time, I have felt the consequence of both crime and scheming, all in one nice package. Part of this is set in the article ‘Robbed of a mobile, but we have to pick up the thief’s phone bill. Why?‘ (at http://www.theguardian.com/money/2015/feb/11/robbed-mobile-thiefs-phone-bill).

Now, my mobiles has been stolen, it has been broken and a few other issues have gone my way. Now in the first, I have to admit that I was with Optus at the time, stolen mobile, we had a business account and to my surprise, a new mobile and no hassle (just a small fee). This was great, the doom feeling of what had happened was a feeling that some places are great to be connected to. Now in the article we see the following quote: “it’s worth pointing out that you are not liable for any charges once you’ve reported a phone lost or stolen. But there are often good reasons why this may not be immediately possible, and during the briefest of delays, thieves can run up catastrophic charges“. Yes, this is true, but there is also an initial solution. You see, no matter how important you are as a business person, your ego is getting in the way fast. You see, disabling International calls on day one, in addition to 1900 and 1902 numbers stops massive costs coming your way. There is also the embarrassment you have when your boss asks you which distributor had 1900-blow-my-mobile is also worth the day one blocking action.

The next paragraph is the kicker: “In 2012, Ofcom gave service providers until that summer to present plans to cap customers’ liabilities and declared they would face enforcement action if they failed. Nothing happened. In December 2013 the government announced that six of the big providers had finally agreed a cap, and that, from spring 2014, customers – like victims of bank card theft – would not have to pay more than around £50 for thieves’ phone calls. Nothing happened. A year on, only Three has introduced protection – customers are liable for only the first £100 before a phone is reported missing, provided they report it within 24 hours“, so when you are on holiday or on business abroad, and your phone gets stolen, the chance of you notifying your stolen phone in time is not an option.

The paragraph becomes even more interesting if you Google the following “Ofcom spineless useless“, you get 32,000 hits. So we can say that whatever Ofcom pretends to be, which by their own statements is “Independent regulator and competition authority for the UK communications industries” (at http://www.ofcom.org.uk/), we can state with some certainty that it has failed the British people close to 100%. This view does not evolve in any positive way when we look at http://stakeholders.ofcom.org.uk/enforcement/competition-bulletins/complaints-disputes/, where we see ‘Ofcom’s Approach to Complaints and Disputes‘, the text on that page is “This page provides links to guidance that Ofcom has produced setting out our powers and processes we will follow in conducting investigations into adherence with regulatory rules, consumer protection issues, competition issues and resolving regulatory disputes“, with a few PDF links, so how useful is Ofcom?

Well, the Guardian had this to say: “It would seem Ofcom is waiting for the government to do something and the government is waiting for the phone companies to find a solution“, which is not even close to the actual part, it seems that Ofcom is all about sort of regulating issues, but awaiting feedback from stakeholders in regards to these actions (which are likely to be phone companies and when we see the Telecoms Complaints Bulletin on Ofcom, we see a few charts on silent calls and unwanted marketing calls. So is Ofcom basically a report valve that gives the telecom companies a signal when marketeers and phone companies have to simmer down a little bit?

So when we see the claim “Ed Vaizey, the digital economy minister, met the big players last month. Once again they promised a code of practice, but, strangely, still haven’t agreed on the details. “We expect the networks to confirm shortly details of liability caps and when they will be introduced,” says the Department of Media, Culture and Sport“, we must wonder if Mr Vaizey is actually seriously looking into an issue that has played for many years now.

The next part involves Vodafone (or Vodafail as some call it) and opens up an entirely new can of worms, one that I myself have been privy to.

“Vodafone says it has agreed to “explore” a cap but the sticking point is how to do that without destroying the incentive to report a phone missing. “We do not want to create an environment where it is even more attractive for criminals to focus on theft,” it says“, you see, that is not the Vodafone I have been experiencing!

So, last year I had a heart attack, this happens, as it happens I had a sim for my iPad with Vodafone, which is a data only thing. Now, I admit, I was late with paying, which is my own fault and whilst in hospital, they had cut me off. With that I had no issue; I was late, my own fault, as I stated before. Now comes the kicker, whilst in hospital  and after that in recovery, I learned that even though cut off, I am still liable for ALL COSTS, so that means that whilst cut off, I am still due all monthly expenses, even when disconnected. The fact that I had had a heart attack did not interest them. So I am still in a legal fight with Vodafone, I accept the initial costs, but the months after that I refuse, so it is due to go to court at some point. Vodafone might state it is exploring, yet its main need is to stay afloat, which makes them close to desperate. That part is seen with ‘Mobile users flee Vodafone Australia‘, which started in 2013. The quote “Vodafone Hutchison Group lost 600,000 customers in the three months ending September 30, even as its British parent first-half results showed a return to profit” is only the tip of the iceberg that will sink the ‘Vodafonic’ (that event filmed by James Cameron, where you see Leonardo DiCaprio drown in icy cold water at http://www.businessspectator.com.au/news/2013/11/13/technology/mobile-users-flee-vodafone-australia). The fact that Vodafone is still linked to a class action brought by Piper Alderman should indicate that Vodafone has a league of issues, capping is not even close to their essential need to solve.

But we go back to the issue at hand regarding phone bills. The article ends with the realisation that in an election year these issues will not be addressed, which means that this issue will stay around until at least 2016, which is odd as we consider the article ‘Bankrupted by a mobile phone bill‘ (at http://www.theguardian.com/money/2013/dec/07/mobile-phone-bill-cap-theft), which is 14 months old. The issue, that was raised and gave way for the quote “culture secretary Maria Miller told journalists in Beijing this week that a deal had been struck to introduce a bank card-style limit to a consumer’s liability – possibly as low as £50“. In my view as a Tory, both Maria Miller and Ed Vaizey need to wake up fast and start a few fires in the halls of telecom corporations. You see, it is after all an election year and should Labour or Ukip achieve that what the conservatives could not, the fallout will be, as I see it a conservative unpopular one (well over 80% of the population worries about their mobile bill), because governing from the opposition bench is not governing at all, it is merely spouting critique to those who govern. The first course of action, as I personally see it, is to shake up the Ofcom executive committee by replacing Steve Unger, Polly Weitzman and Jonathan Oxley. I reckon the signal that the chief executive, the general council and the group director for Competition are replaced by individuals with bite, who will hunt issues for the victims and the general audience, might give the signal to the Telecom companies to act now, or accept a much harsher deal soon after the elections are done. The reality is, that when that signal comes, they will all quickly agree with the Three policy, which means a £100 cap and possible a reporting extension to a max of 72 hours, which would be fair.

Yet, this is not even close to the only thing in play, you see, last month Google made an announcement to no longer support any Android version before KitKat (v4.4). This means that not only are people almost forced into new mobiles, the flaws, gaps and other issues that might pop up are at the heart of what follows and that what is already happening to the current mobile user base (including myself). First there are the iPhones. Apple is already experiencing the class action in that regard. The fact that IOS is taking up around 20% is just bizarre. Apple could have saved itself a lot of hassle by just having the 64Gb phone at a 16Gb price, I was told (from an unconfirmed source) that the parts involved costed no more than $49. So how ridiculous is the entire issue that Apple is forcing upon Apple? Let’s not forget they have around 170 billion in loose change. Now, I am not stating that they had to pay for it, but to just set the 64Gb edition at $799 would have saved them a boatload of hassles. In this Android is not without faults either. The new phones, with 2Gb ram and 16Gb storage drops down a lot in Android. There, of the 2Gb you are only left with 1Gb and you lose an easy 30% of your 16Gb. Now, that is still a decent amount, but to consider that my old smartphone, which was 1Gb with 4Gm storage has now dwindled to a 250Mb phone (so I can run 2 apps at the most), with just 2.4Gb storage is not what I signed up for. As Google became too clever for its own good, adding more and more trash I never want or need, setting dozens of updates which no longer let my phone work is now at the core of my problem. I cannot even deactivate most, it shows up at EVERY update, selecting what I actually need and not what Google thinks I might like is at the core of my growing resent of Android. And with every app pushed out, there is additional danger that the security of my phone gets compromised, especially as Jellybean is no longer supported.

Yet there is more. I am now looking at a new phone, whilst I know the limitations I face. The strongest was the Huawei Mate7 premium. Now, here is the kicker, the 3Gb phone with 32Gb storage will only get you 1.7Gb RAM and 25Gb from day one, Android takes the rest and this is close to the strongest phone that a limited budget can buy. In Australia the smallest iPhone starts at $1000, the 64Gb, which would be a minimum choice is 20% more expensive, whilst these phones only have 1Gb RAM. This all seems as short-sighted as the developers of Xbox One showed to have. Yet, it must also be said that 1Gb seems to suffice for Apple, that is shown in this small article (at http://www.phonearena.com/news/Why-Android-phones-need-3GB-of-RAM-and-iOS-gets-by-with-1GB-of-the-stuff_id62901), yes IOS is more efficient, but as IOS evolves, so will the need for RAM, which when it starts to be too little would of force us to upgrade again. Was it such a jump to set the iPhone RAM to 2Gb? When you become a penny pincher, you face class actions and that is exactly what Apple faces now. Although I remain (for now) Android minded, and When we compare the Nexus 6 (the very latest), we see that it only almost equals the Huawei Mate7 premium. The Nexus is however $100 more, whilst the screen resolution was a lot more impressive on the Huawei, but that could just be the Jazz screensaver. This shows that Huawei is not just the Android player, with the P7 and Mate7, Huawei is now the contender that makes Google sweat. Like Apple, Google could have saved themselves a lot of hassle by not skimping on resources, which could have pulled the customers in like a magnet, now in the margins they will see customers slip through their fingers, which will be an unsettling feeling for whomever misses out on commission.

All this as the providers supported exploitation; we see that the massive losses are now showing as the margins are not worth considering for some. The same could be said for the upcoming Samsung S6, it looks amazing, but as they fix one issue by being a 4Gb RAM player, they waste it on bringing a 32Gb version, which might suffice for now, but what in 2 years? Getting the 64Gb version makes sense, but then it becomes a $1240 millstone around your neck. So as I see it, Huawei is the budget choice, which still gives you a top of the line contender, iPhone and Nexus are slowly pricing themselves away by offering the entry option, which is a joke as we see space used.

All this now links back to the issue of phone theft and the inactions of Ofcom. If stolen bandwidth and phone time is all there is, than you are gravely mistaken, these smartphones are not just a connection, they are a link to your diary, your details, your credit, your access and your future. Soon, we will see that organised crime will not just call their mommy in Samarkand, Zhengzou, Davao or Vung Tao. Soon they will transfer your data and access and see what else is under the hood. That is the added danger of the smartphone, because you had one more mail to read, one more file to see or one more connection to make, all that in applications that were never closed and accessed be merely starting the application. You see, what we ‘need’ to have, came first, and we all seem to forget the consequences of such choices. Ofcom cannot be held responsible for this, but they should have set up several parameters a long time ago, as they remained inactive in the phone charges issue, they also did little to nothing into changing certain parameters in connection monitoring and non-repudiation, all that left to whomever else, that is the danger we will face in 2015 and 2016. Unless there is a drastic event that shakes up the media, there is every indication that nothing will be done until it is too late.

History taught us that there is nothing as effective as taking away someone’s cushy job to make the next person consider showing their teeth from day one, but that might just be my imagination.

 

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February 9, 2015 · 11:25

Questions that follow

Is it not an interesting day, for some Mondayitis is only just now setting in, for some the Mondayitis issue is just a ‘fab’ for others to avoid becoming active until Wednesday around after lunch time, and for another group, well, we never know what they are up to, so let’s ignore them for now. There is however a group that works 24:7 (please do not imply that those people are journo’s).

I am talking about the financial institutions, no matter how we oppose greed, it is the one motivator that will never stop being efficient in many walks of life. That consideration came to me as I read the article ‘HSBC’s response: ‘Standards of due diligence were significantly lower than today’‘ (at http://www.theguardian.com/business/2015/feb/08/hsbc-responds-revelations-misconduct-swiss-bank) this morning.

The article is to some extent a barrel full of laughs. Let’s have a look at some of the mentioned things. The fun already starts at the second sentence “Private banks, including HSBC’s Swiss private bank, assumed that responsibility for payment of taxes rested with individual clients“, you see the word ‘assumed’, in this case that translate to, the bank sets the responsibility so that it makes an ‘ass’ of ‘you’, banks do not work from the ‘me’ setting (ass-u-me). When was the last time when you received a letter from a bank (any bank for that matter) where the word assumption was used? Most banking contracts have two one-sided parts, what your responsibilities are and how you get charged the moment you make an error (like simply withdrawing a little too much). So are you giggling yet?

The next one is an interesting one for more than one reason “HSBC’s Swiss private bank has reduced its client base by almost 70% since 2007“. Yes it is interesting, because WHERE did those people go to? The fact that they moved away from HSBC is no indication that there was a sudden massive influx of taxpayers, was there? So was the exodus reported on? My bet is that this was not; the statement is likely to be ‘this account is no longer under our care‘. This hunt for tax evasion, sounds nice, but it also comes with a flaw, not that I oppose such hunts (I will forever be roughly $1,915,000 short from making that list), but did some of these ‘witch hunters’ realise that moving these funds would have a side effect? You see, it would all be good and fine if those accounts all resorted to their original nation getting properly taxed, but that is not the case is it? As these Status Quo places get upset the dynamics change, when the accounts can no longer be hidden on Bermuda, the Cayman Islands, Switzerland or Guernsey. How long until we see a new circle of banks, now in Bahrain, Dubai and Jeddah? Do not think this will not happen, because it already is happening (at http://www.thenational.ae/business/banking/dubai-islamic-bank-confident-on-loans-portfolio-thanks-to-record-profit), so as we are reading on how a bank voluntarily moved from 78 billion to 45 billion, I have to wonder on the impact of the sentence at the very end: “However, providing client data to foreign authorities would itself constitute a criminal offence under Swiss law“. This than gives rise to the question how these changes are enforced. More important, the sentence implies that providing client data to local authorities is an option, and what they do with it, is not covered here, but it is an interesting question to consider.

The second article, which also came from the Guardian discusses more HSBC issues in ‘HSBC files show how Swiss bank helped clients dodge taxes and hide millions‘ (at http://www.theguardian.com/business/2015/feb/08/hsbc-files-expose-swiss-bank-clients-dodge-taxes-hide-millions), so is this High School of Business Concealers a real bank? Well, that is a moral question not a scientific one. This is where we see more ways to get a case of the giggles. “The Swiss arm, the statement said, had not been fully integrated into HSBC after its purchase in 1999, allowing “significantly lower” standards of compliance and due diligence to persist“, so if we consider the leak by Hervé Falciani, which happened in 2007, considering the fact that the Swiss bank had been acquired in 1999, the simple question ‘Were banking executives allowed to sit on their hands for 8+ years?‘, the question might seem unfair, but no alignment in a bank that was until doing 78 billion seems very odd to me. It almost sounds like a trial in equity. “Yes, sir, I have washed my hands of everything and I have made very certain that I am not being kept in the loop for anything“, might make for interesting academic considerations, but so is the story of the Mayfair prostitute with her Hymen intact (the moral is that neither is realistic).

When you read on you will see the sentence “We have opened a company account for him based in Dubai“, so is the interest of HSBC moving towards additional banks? That question is not asked and should some consider asking Lord Green (who was group Chairman of HSBC in those days), they are unlikely to get any answer.

It is so interesting to see the HSBC onslaught all over the Guardian, but this is not just about that event. It is also nice to see how last weekend, Yahoo reported on how the Swiss Franc is boosting business in German brothels, so in the end at least one party is getting screwed (the question is who of course). Weirdly enough, the Telegraph has a passable view written by Peter Spence (yes, I am surprised too). The end has the quote that mattered in my view “What has happened in Switzerland might be a sideshow compared with larger global players, but is illustrative of a world in which central banks are increasingly looked to for answers“, I am not sure whether this is entirely correct. There is a difference between incorrect and wrong, and this one skates on two sides, you see, the mess, which I discussed in ‘A seesaw for three‘ (at https://lawlordtobe.com/2015/01/18/a-seesaw-for-three/) is still at the heart of this, there is a credit swap in play with many governments in play, it is a global dance act which includes the US, Japan and the bulk of the EEC nations, as tax havens are now under scrutiny, the people using them are looking for options, some will make a deal, but the larger part will be looking for an alternative, I reckon that the Swiss have been very aware with the move of those HSBC accounts and the question is not just where those 70% moved to, but who else will be moving sooner rather than later. When you consider that, we see the picture as it reshapes the issue. The Swiss are holding on for dear life and at some point the Franc will lose some of its value, but as this happens, we will also see a currency destabilisation. That part is seen (in my personal view) as Switzerland is no longer playing the ‘offset’ game for other loans, which means that the game will transfer to other shores, but which shores will they move to? That part is not a given, but when we see how new players are now willing to become a member of the banking secrets. The United Arab Emirates and Saudi Arabia would only need to adopt two rules in their banking laws (if they have not done so already).

  1. Providing client data to foreign authorities constitutes a criminal offence.
  2. Personal wealth can be declared via the bank, who will charge a fee of n% (where it is likely that n < 5).

After that, both the Oval office and Buckingham palace can kiss any chance of those taxable billions goodbye, which could spell a massive exodus from Bermuda, Cayman Islands, Guernsey and Jersey towards sandier shores, which will hurt the Commonwealth beyond expectations. All this started from the wrong viewpoint from the very beginning, the US became reckless on how it dealt with its 18 trillion in debt by going after non-taxed fortunes from American account holders, this drive (supported by many) started a new fire and now that the flames are getting higher, those avoiding taxation are moving to shores where not only is taxation an almost impossibility, it will also limit the other acts done by both the US and the EEC to keep their currencies high, which is an act that will backfire to some extent for a longer period of time.

Personally, I am all for holding the wealthy tax accountable; we all have to pay our taxation. Yet, at present, in this economy, we are now chasing those cars, whilst we have no parking lot, so even if one is caught, what to do with this person? The US, Greece, the UK and a few others should have seriously changed certain laws half a decade ago; this mess would not have been so complete. The fact that this hunt is so visible at present gives also pause for that what we do not see. Yes, we see that the US added 257,000 jobs in January, but how many are not shown as we also see that RadioShack is filing for bankruptcy this week with over 4,000 shops expected to close (2,000 went to sprint). A host of Shale gas companies will go the same way, whilst the mountain of companies going under in the oil and gas sector is a lot larger than many can fathom. These events have a clear bearing on the banks too. Shale gas operations, oil platforms, all these places will get hit and it will affect many banks who held onto debts with the certainty that black gold brought, now there is no blame here, yet the consequence of persecuting tax dodgers will also come with another negative boost as a league of them will move to the Arabian shores, when that happens, the little stability the Euro and the US dollar had, will go straight out of the window.

Here is the kicker, no matter how wrong the expression ‘let sleeping dogs lie’ is seen in light of the tax dodgers, we must wonder how much lower the coming negative financial waves would have been if the hunt for the tax dodgers would have been delayed. In the end, it was not a solution to not go after them, but the timing truly sucks. This situation translates to governments getting kicked in the head, just as they had just accidently stumbled through no fault of their own. Yet in all this, Greece has made ZERO clear steps in dealing with its own tax dodgers, so where to go next? More questions are to follow, but I am not sure if there will be ANY answers forthcoming as it seems that three parties have painted themselves in the corner, whilst the fourth was not in the room at all, in addition these four parties aren’t even clearly communicating with each other, their only goal is to meet their own needs whilst three cannot move and the fourth can’t get into the room, one would offer the thought that a mere pre teenager would have done a better job of it all. I am not sure if I could disagree.

 

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February 6, 2015 · 00:14

A basket full of trash

Have you ever had this? I am not talking about the Christmas or the hospital basket. No, I am talking about those ‘greeting’ baskets you get. One of these: ‘welcome new member’ baskets. You accept them with a smile, whilst you know you are getting a bag full of goodies that have value that is close to zero. Now we get these baskets from book clubs and other longer term commitment places, none of this is a big mystery to many people, because at some point, we all get confronted with this basket. Now, let’s change the game a little, now we consider the same basket, but in this case we don’t look at some two bit online retail vendor, now we look at Price Waterhouse Coopers.

That part is seen in the Guardian as per today. Let me refresh you on some of the facts, for that I will take you back to my blog from October 25th 2014 called ‘Price Waterfall Blooper‘. In there I wrote the following “Consider that PwC had (a reported by the Guardian in an earlier blog) last year; PwC was paid £10.4m by Tesco for its auditing services and a further £3.6m for other consultancy work (a newer version at http://www.theguardian.com/commentisfree/2014/oct/23/guardian-view-tesco-auditing-debacle-pwc-systemic-shambles)“. Now when we add today’s information, information I quite honestly never considered: “The Groceries Code Adjudicator, Christine Tacon, announced the move, saying she had formed a “reasonable suspicion” that the retailer has breached the Groceries Supply Code of Practice“. Now, let’s take a quick look at this so called ‘code of practice’. First of all, the information is found here: https://www.gov.uk/government/publications/groceries-supply-code-of-practice. The fact that this is on a dot Gov dot UK site should indicate that this is the serious stuff. So this code of conduct states at 4.1 PART 4—PRICES AND PAYMENTS, the following: 5. No delay in Payments and at 9. We see Limited circumstances for Payments as a condition of being a Supplier. This is just two of a long list of a code of conduct. The reason to mention these two is the question that follows. ‘How come the auditor was not aware of these facts?’. These are not just simple facts, they are codes of conduct, and can someone please explain to me how this is not raised by the firm charging close to 14 million pounds for one year of work? There are two other parties who are about to see the limelight. Party one is the Press. You see, I was following part of this since last year October, yet, I do not remember seeing the press being awake on these facts. I have a decent excuse living on the other side of the planet and the fact that these elements are not part of my Master of Intellectual Property education, yet the press, Pricewaterhouse Coopers as well as whatever legal aid is out there in UK farmland, it seems to me that too many people were not paying attention at all. There is actually a third side to this. I missed it initially, but when you look at the Guardian on October 23rd (at http://www.theguardian.com/business/2014/oct/23/tesco-black-day-profits-down-92), we see the following: “Tesco claimed that the rogue accounting practices – which relate to how the supermarket banks payments from suppliers – dated back at least two years“. Now consider again the government side that states ‘Guidance Groceries Supply Code of Practice, Published 4 August 2009’, so the statement and the fact that there was a code of conduct out for half a decade, did no one consider that there were additional issues that might rise?

Who on earth is running PwC in London? More important, what on earth is mentoring these wannabe’s? I have good right to speak in this manner. This took me 5 minutes to figure out when I got wind of this small fact, the fact that PwC, the Press and others were not all over this from day one is a little too weird for words. Consider the people that quickly left Tesco when the water got slightly too uncomfortable. Should they have known? I’ll let you answer this question for yourself, but now also consider that the auditors did not make mention in reports on some of these parts, they DEFINITELY should have known about the codes of conduct for the simple reason that part of this is linked to the pesky rules regarding payments and so on. What else did these people miss? More important, consider the date I mentioned (October 23rd), now consider the Deloitte report, was this part in that report? If not, consider that they had to check on these ‘miscalculations’, as we see the mention ‘rogue accounting practices‘ and ‘payments from suppliers‘, did no one consider looking under rock number two? Granted that Deloitte did not get much time, but as we see that suppliers were part of the mix, did no one mention the question ‘What about the Groceries Supply Code of Practice? Do we need to consider any issues there?‘ Did that question seriously not come up?

Now consider my blog from October 13th called ‘A matter of Jurisprudence‘, there I wrote the following “company secretary Jonathan Lloyd, who advises the board on legal and governance issues, had resigned and was serving out his notice until March 2015”, the second one “Ken Hanna, chairman of Tesco’s audit committee, is also set to step aside as a non-executive director as the company’s chairman reshuffles his management team”, which was shown from several sources. Now consider the fact that we see Jonathan on legal issues and Ken as part of the audit committee, they should have known about the ‘Groceries Supply Code of Practice’, which now gives an entirely different light into their departures. So was PwC completely in the dark about this? If the answer is yes, then my next question should be ‘why are they allowed to be auditors?’ Is that such a weird question to ask? It is a code of practice, not a fraternity paper on how to score, so I reckon, especially as it has financial sides, the auditors should have taken a look, moreover, Deloitte should (they might) have reported on this. The fact that the press is only now revealing these events calls for additional questions, but their fumbling is not part of this article, the fumbling of accountancy firms a lot more, for the mere reason that the code states at 5. “A Retailer must pay a Supplier for Groceries delivered to that Retailer’s specification in accordance with the relevant Supply Agreement, and, in any case, within a reasonable time after the date of the Supplier’s invoice“, which should have been part of the financial checks, can we all agree on that part?

And as we take a better look at this basket (have you figured it out yet), we see that the players were in a lot deeper than initially suggested. This cesto, has harboured information, misinformation and above all else, a lack of illumination of the facts as is. First there is Tesco themselves, the latest information shines a harsh light on several members who have vacated their office, in addition there is the case I made on October 13th in my blog ‘A matter of Jurisprudence‘, where I mentioned one person (Rebecca Shelley) who would have been at the centre. The mention on the Birchwood Knight site was “As part of her corporate affairs role, Rebecca will be responsible for government and media relations, investor relations, internal communications and corporate social responsibility“. Rebecca’s job hits ‘government relations’ and ‘social responsibility’. How come that this ‘Groceries Supply Code of Practice’ remained so below the radar?

So when we see months of reporting and we see the lack of mention of this so called ‘code of practice’ we also see the mention in today’s article “Business secretary Vince Cable said: “This is an historic day for the groceries code adjudicator and shows we have created a regulator that has real teeth“. Who is this Vince Cable catering for? You see, if this statement had been given before December 1st 2014, then there might have been a case, at present the act of mentioning it months after going live is just another presentation of a sad story on how some people could be seen by many others as some parties remaining silent hoping to make a bundle down the track.

So I reckon that Tesco will have to sweat the small stuff for some time to come, however, the more we get to see at present, the less clean the image of PwC seems to be. In the case of PwC it will become a case that is worrying on several levels. Not only are the looking for hardship over what was done, as per now it seems that PwC will be scrutinised for the things they did not do, not properly oversee or missed altogether, as per today it sucks to be the senior account holder of the Tesco account, because the fallout will continue for a decently long time to come.

So as we see the basket (also known as a cesto) filled with the trash of information, wrongful acts and none acts, can we all agree that we got a whole lot of nothing, an act that will have severe repercussions and not just legal ones! Does anyone remember this Warren Buffett fellow and how he lost 2 billion in value? If we combine what we have seen so far and add the part that I discussed in October regarding the Chadbourne papers, I can repeat that quote: “that directors of companies must make certain disclosure statements in the directors’ reports. This applies not only to information which the officer actually knew of but also information he would have known about if he had conducted a reasonable enquiry. However, the provision goes further and requires the director to confirm that, so far as the director is aware, there is no relevant audit information of which the company’s auditors are unaware”. This now brings an entirely different light to the Groceries Supply Code of Practice, moreover, it could be suggested that Warren Buffett now has a clear case in legally reclaiming his losses, consider that the US has the Sarbanes–Oxley Act, after Enron, which took care of the power players real fast. The UK has the Corporate Governance Code. I reckon that it is not too far-fetched that Mr Warren Buffett could be offered a deal for his lost two billion. If so Warren, remember this poor blogger and I feel so much better getting to work in a new Jaguar XK, in British racing green of course.

 

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January 29, 2015 · 21:21

Whinging from a desperate left

This is how I felt when both ‘We must stop Angela Merkel’s bullying – or let the forces of austerity win‘ by Owen Jones (at http://www.theguardian.com/commentisfree/2015/jan/28/syriza-merkel-economic-greece-europe) and ‘Bank of England governor attacks eurozone austerity‘ by Larry Elliott (at http://www.theguardian.com/business/2015/jan/28/bank-england-governor-attacks-eurozone-austerity) passed in front of me. It is a unique issue, the political left in league with the banks. It is likely to be a first. The left want the image of cost of living relief, which is a ludicrous fantasy to begin with and that fantasy seems to be all about getting to spend money. We have a similar ‘BS’ joke like this in Australia. That person is called Bill Shorten. You see, as I see it, the banks want ease so that this generation can get a few more millions in commissions before it all collapses.

Let’s take a look at the youthful Mr Oxford (Owen Jones). It starts with the opening premise: ‘Angela Merkel is the most monstrous western European leader of this generation‘. No, she is not! Let’s take a look at the past. Around 2009 Merkel stated that enough is enough. She introduced austerity measures and she sliced back on German spending by a lot. The German people were in pain, they all were. The consequence was that the debt had gone down by a lot, so when harder times came, Germany had shed some of its debt and as such, lower costs on interests and therefor the pain that followed in 2011 and 2012 was suddenly not as painful for the Germans at large. I remember seeing the news. The Dutch did not adhere to such notions, they were all in the mindset like ‘it will get better next year’, at that time the Dutch Finance minister was Wouter Bos. It would not be so good. To be honest, the pain the Dutch felt would not have been that extreme if they had tightened the belt from 2009 onwards as well, but they were all adhering to their ‘good news cycle’, whomever came next had to clean up the mess. It was not just the Dutch, the French, the Italian, the Spanish, as well as the United Kingdom, they all went overboard in spending trillions.

So when I read the deluded word by Owen Jones, it just makes me a little sad. the quote “The Greeks have rebelled against machine men – and women – and they are crying out for others to follow“, that sounds nice as an epitaph for Don Quixote as he marches against the next windmill (possibly a Dutch one), but the Greeks created their own mess. Their inadequacy to deal with corruption, tax collection and a host of other issues got THEMSELVES into the mess they have. Would it not be nice to clearly state that?

Then Own comes with “As Krugman notes, the troika – the IMF, European Central Bank and European commission – promoted “an economic fantasy”, for which the Greeks have paid. They projected that unemployment would peak at 15% in 2012, but it hurtled to over 25% instead“, which is a part I do agree with. There was an economic fantasy, because the austerity measures needed where on lethal levels which cannot be denied, how do the Greeks react? With a series of strikes and vandalism events which only got them into deeper water. A watery grave the Greeks had created for themselves. They now have a debt of well over 325 billion for a population of 11 million, so how wealthy are those 11 million Greeks? If not, where did that money go? The fact that Greek bonds are now at 9.85% should be an indication that Greece is now almost denied existence, it for the most, only has itself to blame, since 2009, how many Greeks actually went to court and to prison for what was done? Of the 2069 Greek accounts in Switzerland (as mentioned in a Greek magazine), who besides the journalist has appeared in court? It seems that making Germany the scapegoat for something the Greeks did themselves is absent of loads of logic.

Then we get another quote that is up for discussion: “Germany ploughed money into countries such as Greece and Spain – that’s the “magic” of deregulated markets – and in doing so “lent more than they could afford”. German banks and their political champions should have known this would end in disaster“, I disagree. Greece was given an option, but was also informed of the intense pressures that this causes. What did they do? Whinge and whine like faulty politicians with the spinal cord of a paperback, not a hardcover amongst them! Instead of going after tax dodgers and those who had made bad calls, to see what they could get back, they went into states of denial, like flaccid applications to a concrete wall, not a scratch was made and when the time was up, they again, whined for more cash, an idea given to them by Charles Dickens in his story Oliver Twist. Then suddenly miraculously, the crisis was over and suddenly they went back to the bond market for more. None of those events are in this article.

Last we get “The future of millions of Europeans – Greek, French, Spanish and British alike – will be bleak indeed. That is why a movement to defend the already ruined nation of Greece is so important. Defeated Germany benefited from debt relief in 1953, and we must demand that for Greece today“, how about the clarity that debt relief came and Greece did nothing, and now, they are whinging and whining (again) for more cash, less debt (through forgiving current debts). However, nobody is making any headway in aligning the justice system and the law to take care of those evading taxation. It will not be anywhere near enough, but it will be a clear signal that Greece is serious about taking a stance for resolving debt and fortifying its annual income. Oh and when the debt is forgiven? Who pays for that money not coming in? The IMF or divide the debt over all the EU nations, who are all beyond their maximum borrowing points? Perhaps option 2? Let the ‘Grexit’ commence and let’s see how the Drachma will leave the Greek people in a state so much worse. At that point the people will dream of those good old austerity times.

Let’s face it, it is not fair to the Greek people, not one bit, but I have seen enough BS in regards to blaming the Germans for what some Greeks did to Greece. If we look at 2013, the quote “The state collected less than half of the revenues it was due to receive last year as it appeared unable to ensure that taxes and fines found their way to its coffers, according to a State Audit Council report submitted in Parliament on Tuesday by its president, Ioannis Karavokyris“, this was an article from November 2013, almost 4 years after the mess they themselves created. (at http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_05/11/2013_526451), so as the Greeks drop the ball over and over again, who do they have to blame but themselves? So as I take my leave from Owen Jones, we look at the second Mr Oxford in this equation. With Owen I am willing to concede that he has his ideological heart in the right place, with Mr Smiley Smiley Canadian Mark Carney, former Governor of the Bank of Canada and the current Governor of the Bank of England, the gloves come off. So let’s introduce Marky Mark to the business end of a two by four in the shape of a keyboard!

It starts quite lovely, immediate of the bat with “Mark Carney says eurozone is caught in a debt trap and should ease hardline budget cuts just days after the Syriza election directly challenged policy“, just under the title. Why should we ease up? If we ease up after an election, the Greeks can forgo debt by having 12 elections over the next three years. It is the cost of doing business and as such, the Greeks themselves have not shown one iota of intent from 2009 onward (the lack of artful tax dodge prosecution could be regarded as evidence piece number one).

The second whopping ‘miss-statement’ might be seen in “Speaking in Dublin, Carney said the eurozone needed to ease its hardline budgetary policies and make rapid progress towards a fiscal union that would transfer resources from rich to poor countries“, when we see parts like ‘transfer resources from rich to poor countries‘, in my view (and in the view of some others), it reads like ‘as big business transfers corporate structures towards economic ailing areas. This was achieved through a subsidy structure that gave way to spreading business opportunity to less fortunate areas’. It also translates in the non-written text part of that statement as less tax liable options for big business, already far beyond normal wealth, move towards areas where labour laws are even less protective, optimising profits for big business.

So when he states as a bank governor the following “Carney made it clear that he thought the failure to complete the process of integration coupled with over-restrictive fiscal policies risked driving the 18-nation single currency area deeper into a debt trap“, which is not untrue, yet the part as a banker, that he does not mention is that he and his buddies profit greatly from spending sprees, if governments suddenly get a hold of their budgets, banks lose out a lot. This can be seen in the simplest way when we consider the Greek bonds. When that market opened up again (which should never have been allowed), the Greeks did not just add to their debt, someone in the banking world ended up with a 65 million euro bonus (in total) for selling these bonds, I am certain that the ‘wealth’ was spread around a little, but some of these financial people just cannot make ends meet on 350K a year, supporting a wife, kids, a Ferrari, a Ducati and two mistresses. You need that bond bonus to feel secure in your way of life as I see it. I wonder if the easing up has anything to do with meetings that places like Loomis Sayles ‘might’ have had with Natixis, perhaps Mr Carney attended a social event in such settings?

I agree with the premise we read in the quote “Since the financial crisis all major advanced economies have been in a debt trap where low growth deepens the burden of debt, prompting the private sector to cut spending further. Persistent economic weakness damages the extent to which economies can recover. Skills and capital atrophy“, I agree with that premise, yet this was a given already in 2011. I foresaw these events in 2012 and I read as bankers all over the place were hosting to ‘bright weather forecasting‘ whilst not taking the cautious steps that should have been taken. We can either state that politicians were too stupid to consider the dangers, or they were happy to leave the mess to those who followed (like Labour left hundreds of billions in debts to the Liberals in Australia), after that we see banks and the media in cycles of ‘bad news management’ slowly lowering expectation and forecasts, whilst the money had already been spend. So, yes Mr Carney, you state a good quote, it is just incredibly incomplete!

So, when we read “Carney has been vocal in his support for the European Central Bank’s decision to start buying government and commercial debt in its own version of the quantitative easing programmes, but said the Frankfurt-based central bank was unable alone to eliminate the threat of a prolonged stagnation“, we see nothing wrong. It is to the smallest degree commendable, only to the smallest degree, because several governments had entered a state of overspending, followed by ‘bad news management’ an intertwined cycle that would undo whatever headway quantitative easing would bring. The need for greed will always win in the end, so those programs are just a fantasy, Greece has some evidence of that part too, as they were part in both sides of that game. Isn’t it nice when the bank plays player one, player two and acts as the bank in the middle. That part truly sucks if you are player three and four in a game of monopoly. If we see Germany as player 3, than who is player 4?

I’ll let you do the math there!

You see, the actual solution would have been to take a stronger position on IP rules and regulations. An approach to ease the path for the small innovator of newly designed products. As several IP sides were all about setting goals towards ‘business’ (read big business), they forgot that when we look at the period between the 50’s and the 70’s, innovation came from the small inventors. Nearly every economy starts stepwise from small players and small innovators. Today, the players are so focussed on the large amounts, they tend to focus on large players like Apple and Microsoft and they forget that these companies, for a larger part live of the premise of the Vulture cycle, you pick the carcass until the hunter shoots a new prey, then they wait until it is feeding time. Small innovators (like Markus Persson with Minecraft) have the actual idea, which a large company then buys for 2 billion plus. As small innovators are given space to proceed and as larger players are denied blocking patents to force amalgamation of the true visionary into their moulding process that is the moment when economies will truly move forward. That is how you get forward momentum!

So when we see the final quote by Mark Carney “Carney said the eurozone’s unemployment rate of 11.5% was more than double that of the UK, but its fiscal deficit – the gap between tax revenues and spending – was only half the size of the UK’s. The eurozone, he said, should be using a “constructive” fiscal policy to support demand and mitigate the “tail risks of stagnation”“, we should wonder who he is catering to. As I saw it, the article was all about policies that are interesting for the boards of directors of the corporations, but the people will only be allowed the conceptual benefit on the tale end. Benefits that might have been a realistic form of support for treasuries all over Europe if they had done something actual to properly set up tax policies. Catering to big business stopped being constructive or lucrative for governments for half a decade now, how much longer will you take until you figure out that big business only caters to their own board of directors?

 

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January 28, 2015 · 23:42

Chapter 13

I have been aware of the story for almost a day now. To be honest, it took a little while to let things sink in. Also, my approach here is completely different from my other stories. This all is not a clear cut thing and I might be barking up all the wrong trees. The story ‘Argentinian government moves to dissolve domestic intelligence agency‘ (at http://www.theguardian.com/world/2015/jan/27/argentina-government-domestic-intelligence-agency-alberto-nisman) should be a wake-up call to many people. What you are about to read is not based on evidence, evidence that we see as quality facts that can be used to speculate on what actually happened. I am stating that none of the evidence is of any calibre at all, I am however using the events that I am aware of and as such, I see a different escalation, one that could be utterly wrong. I leave it up to the reader, I am just warning the reader at this point, to scrutinise my thoughts, as I do and do not accept the speculation on face value alone.

You see, for the most a population has little to no clue what their levels of protection are, until they are removed. Consider that we in Australia need to remain safe whilst someone decided that Australia will be a lot safer if the ASIO is disbanded. I can tell you now that this would be the worst idea in a long line of really bad ideas. If we go by the oldest book on this (the art of war), then at some point, the reader gets to chapter 13, which is all about espionage.

Today, we have a host of issues with spooks, but the one we ignore is that they are here to prevent issues. Yet now consider that these are used against us. However, be aware that spies can be used in any matter of ways, in addition, these groups do not just represent governments, at times large corporations employ them for similar reasons.

So as we look at the initial text, I will add the conversion to modern and technological approach

From the view of the Art of war, we get the following:

  • We employ the use of spies, of whom there are five classes:
    • Local spies;
    • inward spies;
    • converted spies;
    • doomed spies;
    • Surviving spies.

There is a book; it is called ‘Broker, Trader, Lawyer, Spy: The Secret World of Corporate Espionage’ by Eamon Javers. It is not a bad read, more important, this current world has an evolved use of former intelligence officers (from many countries), some come from the redacted world of cutbacks in the US and some who privatised themselves. They use their spy craft to aid corporations in distinguishing weaker targets, preparing for cases and litigation in several legal areas and to aid in final trading decisions, as well as change the premise of trade agreements (or to destabilise them by interfering with costs and profit margins. For these options, they might choose to employ Local Spies and/or Inward spies.

In modern days, we will actually see the converted spy in several ways, whether this person is an informer through IT, a trader, or merchant. In the household form, see this person as one of your distributors, however, as he is getting his bonus from another source, he will tip the revenue scales in a minor way, you that you almost got the job, but almost getting the job is not the same as getting the job and you lose out on revenue. I can go on and give you examples of the last two types, but you get the picture!

So why is this event an issue at present?

Consider that Argentina, as it is in such a dire situation, that it needs to get its economy in a much better place. Now we look at the first quote “Argentina’s president announced a major shakeup of her country’s intelligence network on Monday in her most combative step yet to address the fallout from the death of prosecutor Alberto Nisman“. This sounds all fair and good, but is dissolving the intelligence agency a step that should be considered? Let’s not forget that Argentina has two enemies, the first one is big business. Big Business will always be an enemy of ANY government that prefers to give a fair deal to the people of its nations; the second is X, which is not the United Kingdom or the Commonwealth. Yes, there has been and there will remain a clear difference of opinion there, but that is a disagreement, not a statement for hostile acts.

When we look at what drove all this (at http://www.nytimes.com/2015/01/20/world/americas/alberto-nisman-found-dead-argentina-amia.html), we see the title, which gives us a first clue ‘Puzzling Death of a Prosecutor Grips Argentina‘. “From the moment 10 years ago when he was assigned to investigate the 1994 suicide bombing of a Jewish centre here that left 85 people dead, Mr Nisman, an even-keeled lawyer, became entangled in a labyrinthine plot that he traced to Iran and its militant Lebanese ally, Hezbollah“, in addition we get “explosive accusations that top Argentine officials, including President Cristina Fernández de Kirchner, had conspired with Iran to cover up responsibility for the bombing as part of a deal that would supply Iranian oil to Argentina“. You see, Argentina has a few issues all over the place, in addition, there is no denying that the people have never forgotten what happened in 1994, yet, and my deepest apologies to those who had lost loved ones, friends and people they knew, this event is not the highest priority for Argentina in their current dilemma, so why is there suddenly a revelation?

I am not entirely sure that any of these facts are true (pure speculation), when looking at the timeline, the events are off. Is it not convenient that Alberto Nisman ends up dead just after he accuses certain people from a case that is two decades old? Did he actually find evidence? Perhaps something was given, or left for him to find. Consider the implied involvement of Iran and its oil delivery, why would that now get distorted, just when oil is massively on the way down in price. So as we read: “He accused Hezbollah of having carried out the bombing and senior Iranian officials of having planned and financed it“, based on what evidence? This is not a case that has had nonstop attention; it was a specific case, a 20 year old one. How hard would it have been to insert scraps leaving to fictive evidence? In addition, Hezbollah has eagerly taken credit for their actions in the past, so why deny it now? I am not stating that they are innocent, but the fact that Hezbollah has a fading course of visibility, this claim would give them the ‘image’ they wanted to have.

The next part hits back to all the parts mentioned before. The person implied in this, now suddenly disbands one intelligence branch and creates a new one. Is this just a shifting label, or are the people getting replaced. I reckon in Argentine’s current predicament, to remove their intelligence branch for someone else is tactically bad (guess where all these officers would go to) and if it is just a sanitation of bad apples, the branch would not needed to be disband in one instance and created in a reformatted version the next.

All these elements are not adding up. Now, let us be fair, why would it make sense to me? I am not in Argentina, I have no clue what the reasoning is and why certain political steps are taken. So, consider this quote from the guardian “Cristina Fernández de Kirchner said she would support a bill to dissolve the existing structure – which employs more than 2,000 people – and replace it with a new federal intelligence agency“. When we add the following part “It follows a protracted struggle with the intelligence agency that has come to light after the suspicious death of Nisman, which the president blames on rogue spies who are trying to undermine her“, as well as ““We must start to work on a project to reform the Argentine intelligence system, in order to clear up a system that has not served national interests,” Fernández said“, so as we see the known facts, the president, who will be leaving  office after two terms is now, 9 months until elections, shoveling over a massive anthill called the ‘Intelligence branch’? So, as we see the accusation of ‘rogue spies’, instead of cleaning house, they are resetting the entire branch? That does not seem like the best idea. Regardless whether there are rogue elements, it is likely that other connections remain hidden as it all goes into another form, which means that it could easily start again. The question on how Alberto Nisman died is still not settled with clarity, so if it was murder, than shuffling the intelligence branch seems an even less good idea.

I can also state with some certainty that doing all this, whilst Argentina is still in treacherous economic waters, having a reliable intelligence branch is pretty essential. Yet, this gives us the part, is it reliable? Latin American nations have been accused more often implied accused seen as a harsh, possibly corrupt group of power brokers. If that is the case, cleaning the intelligence foundations make a lot more sense than ‘just’ relabeling it. If we accept the last quote “her tussle with the spy agency has so far led to increased surveillance powers for the army“, we must consider more than one path. Was this step deliberate, or was it orchestrated? You would think that both answers are the same, but they are not. In the first case we see the consequence of shifting powers, which grows the military oversight, in the other situation it was always about setting military oversight and this was being orchestrated by reshaping the intelligence branch into a Federal Intelligence Agency. The question then becomes, if this is a step towards the ‘FIA’, why was it done in this way? Consider the espionage part in the beginning. Venezuela is in a very bad state and until the hedge funds issues are completely resolved, having an active intelligence branch at your disposal seems pretty essential as well. Let’s not forget the reference to the book in the beginning, under these conditions, there could be profit for both Uruguay and Paraguay, Chili is also a player in this case. As the intelligence branch falters, it also means that economic and corporate advantages could be gained at the expense of Argentinian margins, that whilst the hedge funds vulture issue remains unresolved. All this leads to the question what has actually been happening, it seems decently clear (in my personal view) that the reference to the Jewish centre was not a cause for accusation, but likely a diversion. So, why were certain allegations made, more important, why is the accused president not receiving a lot more opposition and vocal complaints?

We won’t know what is actually in lay, perhaps for some time, but when this article gets more space, at that point, I will follow up on this story, hopefully all loaded with verified facts.

 

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January 26, 2015 · 23:54

Double standards, no resolve (part 2)

Part two is not about Greece or the Greeks, it is about what has been behind several parts for a long time now. Yet, the visibility of certain events is now forcing another large change to the surface. First let us look at the events as we see them in the Guardian (at http://www.theguardian.com/technology/2015/jan/25/wikileaks-google-staff-emails-us-government).

The title ‘WikiLeaks demands answers after Google hands staff emails to US government‘ calls for a few thoughts, but I think you should consider a few quotes and then reconsider how you feel. The first one is “Google revealed to WikiLeaks on Christmas Eve – a traditionally quiet news period – that it had responded to a Justice Department order to hand over a catch-all dragnet of digital data including all emails and IP addresses relating to the three staffers“. The second one is “Harrison, who also heads the Courage Foundation, told the Guardian she was distressed by the thought of government officials gaining access to her private emails” and then we get “The investigation followed WikiLeaks’ publication, initially in participation with international news organisations including the Guardian, of hundreds of thousands of US secrets that had been passed to the organisation by the army private Chelsea Manning“. So this was specific! Let us not forget that this person (Manning) should be regarded as guilty of treason! This is nothing less than an intelligence analyst going beyond rogue! Manning was a simple E-1 private with no comprehension of the complexity of wars, especially the war the US found itself in, a theatre that is hard to grasp for some of the brightest generals (you know these highly educated, passed their middle age point individuals with a few decades of military experience, in the US seen wearing stars on their shoulders). No, Manning decided on the safety of hundreds if not thousands of lives. In addition US diplomatic efforts were thrown out of the window, setting economic options back for up to a decade, if not longer.

So when we see the response by investigative editor Sarah Harrison “Knowing that the FBI read the words I wrote to console my mother over a death in the family makes me feel sick“, seems a little hollow. For one the FBI does not care about her mommy, two, what did you expect to happen when you access unauthorised data to the size, scope and extent as Manning had transmitted?

I think Harrison is overreacting, if we accept chapter 13 in the Art of war, both the spy and the receiver of information should have been put to death. Is it not a good thing that it was merely investigated by the FBI?

Yet, there is a side that many are ignoring; many do so in an unintentional way, mainly because it tends to not hit us in any way. For that we need to take a step back to Forbes 2013 (at http://www.forbes.com/sites/robertwood/2013/08/06/excuse-me-apple-google-starbucks-h-p-irs-wants-to-tax-stateless-income/), here we see the following parts: “U.S. companies are said to have more than $1.5 trillion sitting offshore. Most claim that they must keep the money there to avoid the taxes they would face by bringing it back to the U.S.“, “the money at stake is enormous. Plus, the companies involved have treasure troves of cash for many war chests. Big and protracted battles seem inevitable. Still, some big companies may be in for battles that are even larger than they think. They may even need to think different” and “The OECD plan claims that companies like Apple and Google avoid billions in taxes. The G20 is made up of 19 leading world economies plus the European Union. It too has voiced support for a fundamental reassessment of the rules on taxing multinationals“. These thoughts all sound nice, but there is an additional element to all this. You see, as I stated more than once, currency is slowly on the way out (loosely approached). The nations that are left with manageable debt are now slowly but surely diminishing to zero. Greece may be the first one, but at minus 18 trillion, the US is the clearest one to end up with nothing, especially as those large US firms have become stateless. You see, now we get to the good part, the new currency will be IP, but here is the kicker, most (including me) seemed to forget that IP is more than Patents and Trade Marks, it includes data! Now we get to the nice stuff, you see, Google adhered to a situation, Twitter and a few others did not, or at least in a delayed way, but the new currency will include massive amounts of data and many players are now catching on that data is at the core a stateless, virtual and duplicable currency. No matter how Sony called its hack attack, does it now look a little clearer that those having a copy of that data are preparing for more than just a data dump? This is what McKinsey & Company had to say in August 2014 “Indeed, the analytics performed by actuaries are critically important to an insurer’s continued existence and profitability“, as well as “While the impetus to invest in analytics has never been greater for insurance companies, the challenges of capturing business value should not be underestimated. Technology, as everyone knows, changes much faster than people. The key for insurers is to motivate their highly skilled experts to adopt the newest tools and use them with creativity, confidence, and consistency” and finally there is “The proliferation of third-party data sources is reducing insurers’ dependence on internal data. Digital “data exhaust” from social media and multimedia, smartphones, computers, and other consumer and industrial devices—used within privacy guidelines and assuring anonymity—has become a rich source for behavioural insights for insurance companies, as it has for virtually all businesses. Recently, the release of previously unavailable or inaccessible public-sector data has greatly expanded potential sources of third-party data“. Yes, it sounds nice that there is public-sector data, but the one part no mentioned is how the analytics is not driven by those, but ascertained through private-sector data fields. You see the data that Sony had on its employees and on the actions of 70 million customers is a lot more insightful when you link it to medical records. Consider how much profit a company gets if it could ascertain more precisely the risk 7 million of its own customers are. If the connection of medical (obesity) and the gamer data of one person results in a $12 per month surcharge, what happens when we see the US having an obesity rating of around 32%? Now we have 70 million accounts and their gaming behaviour. So if we do the following math 32% of 70 million (falsely assuming that they were all American gamers), then we now get the number of people confronted with a $144 a year additive. So in one swoop, this data set gives way to an additional $3.2 billion for insurance fees. Data is going to be that simply applied sooner than you think. With the cloud being forever virtual (as one would think), people forget that a personal space is linked to a real location (wherever that drive is), but what when the data set is beyond massively huge? What if it is spread over several locations? How do we think then? You see Stateless data is not a new concept, but until recently it was never a realistic concept. It is interesting how tax dodging makes engineers a lot more creative.

At the foundation of all this is not the Wikileaks part, that part just illuminates the nutty side of data. Consider the amounts you as the reader had shared in the last 72 hours via Facebook, LinkedIn, SnapChat, Instagram and such. You freely distributed that, you gave up your privacy rights for whatever you openly published. Now consider that whatever you shared got collected. Several people were on vacation (so someone knows that their house is empty and possible unguarded), some revealed that they were sick (health data) and some revealed other details like parties attended and such.

Now the empty house is the most direct one, but not the most important one. Consider the times you updated your status that you were at home with the flu, or something else. Under normal conditions you just had a sickie, or perhaps another way. Now consider that someone now automatically collects the times you were sick, how does that affect your premium? How will your health cycle be analysed if you are shown to have attended 15-30, or even 50-100 parties a year? How long until this shows as detrimental on your health chart? Weirdly enough not having that does not lower your premium, but there is every evidence that doing it will increase your premium.

Do you think that this is over the top?

Then see the following (at http://www.qbe.com.au/Personal/Home/Managing-Your-Risk/Insurance.html). Here we see “Importantly, reducing the likelihood of making a claim helps protect your No Claim Bonus, helping to keep the cost of your insurance premium down“, which has been a truth for a long time. Yet when we consider the mention ‘Don’t alert people you are going away (including on social networking sites)‘. How long until someone combines the two? At reputation.com we see the following “Life insurance companies are increasingly turning to the Internet to determine a potential customer’s risk“, so if you like extreme sports, you might pay for that passion in other ways too. In addition, the one most disturbing was “Donating to charitable causes is a noble gesture, but if you show too great an interest in any particular medical-focused cause, say breast cancer research or prostate cancer awareness, it might indicate to insurance companies that you’re at a higher risk for certain illnesses“, that gives a possible (implied, but not proven), connection that your social responsibility comes at an insurance price. Did you consider that? And this is not starting this year, or next year. Some of these events started no later than 2010.

This all was nothing but to pave the way for that what comes next. You see, there are several sides to Google and Facebook. They are all about bandwidth and several nations are now seeing that even though Facebook is too large, there is a clear path that data is currency, so how long until we see a growth of radicalisation through localisation? This is not radicalisation in the violent way, but in the opposite way. You should see radicalisation of data, attained by washing all the data markers in local server environments. You can’t wash all the markers, but you can make access to it a lot less available. This is the fear Google (possibly Facebook too) has had for some time. As these privacy acts, that data acts and data collection rights of the US grew in a need for compliance, people become falsely fearful of what is dangerous and what is not. The US government ascertaining whether you are a terrorist is not a danger. An insurance company upping your fees by $150 through collected data is a direct danger (to your cost of living). Now we see the link as it gets us to the first story that included Greece.

There will soon be a higher need for localised connected providers. Localised forms of Hushmail (www.hushmail.com), where the people get encrypted mail accounts that can be accessed online, through the web. How long until mobile users will select encrypted android apps, that do not connect to Google, but to local Hushmail providers. We still have the internet, but it will now go through national portals. The fact that Sony happened was only a matter of time. The fact that people now want that there data comes with actual privacy is a growing wave. The Wikileaks issue was the most visible and the most harmless one (for us citizens at least). The world is changing a lot faster than last year and many are now getting clued in that the things of value have not been guarded in the right way.

We will soon see new options on cheaper internet, cheaper mobiles and on package deals, this is what was skated around when this so called IP hearing was going on. Yet, when we look at an earlier statement by Mr Turnbull, in regards to IP, who said at the time. “It is very, very, very difficult if not impossible for someone that is just selling connectivity, just providing bandwidth to then be monitoring what people are doing“.

This is at the heart of the problem, they live of bandwidth, because bandwidth implies data, and the more used, the more data collected, which leads to the better their lives are. This is why they do not want monitoring. I am fairly certain that as their bandwidth falls away, as people move to localised solutions, which remain at the core local, these providers will ‘suddenly’ opt in a ‘possible’ solution. Only at the end of the tether will an industrial give in. Oddly enough, with fear of privacy and the dangers of insurance exploitation on the rise that tether will end up a sudden two inches shorter and now those providers will have to share that what they never had to share before.

Greece has changed the way they play the game; now perhaps we can change the game that is played and make a first monumental change for all!

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