May 21, 2013 · 00:54

Values of a debatable side

OK, it is 23:30 at the moment and I am finding out the hard way that life in a hospital as a patient can be different from your daily life in the corporate world with fluent internet and then some, go figure!
So when I initially listened last weekend to a few newscasts in regards to a team of devoted UK MP’s I was not completely on the ball. Yes, they were having a go at the dude from Google, but alas, it was not the price fight we might have seen when some have a go at Lawrence Ellison, and the MP’s go home crying like Charlie Brown after an encounter with Lucy.

So there they are, Amazon, Google and their margins of non-taxation. Those MP’s dressed like bankers and charging like Don Quixote.
It is almost like a new disney ‘fairy-tail’. The pot calling the kettle brokered. Is it not a little on the hypocritical side, that AFTER they bail out RBS, when RBS reports a 2 billion loss, that personal ‘acquaintances’ still go home with a bonus total of almost 400 million? That was not stopped was it?
But Amazon and Google, after they did everything legal (not unlike the bankers of a fat-cat persuasion), and used exactly those correct steps in their order processing that now certain MP’s cry Havoc and slip-up the dog of stores.

This situation does bring back memories of my previous blog where I accuse members of the EU thinking too local in certain cases, this tax front reads the same way. Now, if you think that I will advocate one version of taxation for the EU, then think again. That is just not realistic! That is like putting 22 toddlers in one room, asking them to all select the same piece of chocolate, good luck with that one!
Yet, the idea to streamline certain forms of taxation to ease businesses in an optional situation where web stores will have equal rules, rights and burdens is not that bad. Of course not all EU nations have the same powerful internet, so more issues will arise.

In the end, is it about web stores and taxations? Let’s face it, a political grilling that was senseless and pointless to begin with? And let us not forget, no legal transgressions seem to have been made (if I am incorrect, then this blog WILL be updated). It is also interesting that the chair person of the committee Margaret Hodge, and her family connection to Stemcor seems to be in the same class of fishing pond. How revealing! What was that about a pot and kettle I mentioned earlier? By the way a special thanks to Helia Ibrahimi of the Telegraph who had several of these facts before I did (4G in a hospital is not that realistic, hence my delays).

Yes, it seems that a elevated level of lesser taxation does exist, like an additional income support class for billionaires. Hoo-de-la-lay, as Prince John would say (Copyright: Disney).

So looking at these issues, and these facts, then what is this really about? Will this be the kick-off for a ‘simpler’ tax system? (like billionaires do not get enough deductibles as is). Is this about uniting into one tax system? The latter part would be a nice idea, however with many EU nations in desperate shape to get revenue, not realistic. There is also the slight humorous thought of PM Cameron calling Dublin asking them to do him a favour and not process Google’s non taxable issues there. What are the odds that Irish laughter will reach the shores of Sydney? #JustSaying

Make no mistake, there is more going on here. Do not be fooled to think that this is just visibility. The honourable Margaret Hodge for Barking is one clever cookie. She has been around for a long time and when it comes to the disciples of Machiavelli, she is up there with the league players, which beckons the thought what is this the start of?
The only part that comes to mind is that this is a two edged sword. On one side this is only partially about the tax lessening that Google, Amazon, a few others and the family firm (Stemcor) are enjoying. This might be in one part, a nice little jab to raise the topic of raised taxation during the G8. Consider the issues that the EU needs revenue, now consider that 1% of something remains better then nothing, and that plays nice to the Stemcor business family too, All these EU items play in her/labours favour. If David Cameron does nothing, he will look weak, any act by the PM will economically hit back and gives chance for an overwhelming victory for labour next election. The UKIP issues do not help much either, but at least in that part they are not on the side of labour.

Still, whatever pressure is applied to increase the billionaires tax bill, Westminster must be careful not to be too harsh with their ‘scare’ tactics. Scotland is only 725 km to the North and Stemcor already has an office there.

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May 19, 2013 · 12:02

Parenting by the pool

The first line I heard in a newscast was upsetting to me. They were the words “Why were there no life guards?” I understand the agony they have, I know that people want to blame someone, and from the facts I heard on Sky News it is without question that the hotel had made some whopping mistakes. quite likely emergency services failed too. I state likely, for the very reason that many places outside Western Europe do not even have anything close to emergency services as most of us know it. For example, in Sydney, where ambulance services are outstanding, moving slightly out of the area, one would go from almost immediate services to services that need 20-40 minutes to get to you. That is a simple and uncomfortable reality!

Australia has had its deep tragic moments of pool accidents with a tragic outcome more than once. When a child under 10 goes into the water you as a parent NEVER EVER leave it alone. Stay with your child until the child becomes a teen. Even if there is a life guard, the simple reason is that if another child calls the life guards attention to act, your child becomes a target for imminent danger. The life guard is there to aid YOU! The life guard should be trained in first aid, he should know resuscitation if needed (we always hope that this is never needed).

I deeply feel for that family and their loss, I would not never ever want to wish this on my worst enemy. My strong words are meant for YOU, all readers with a child under 10, ready to go to a warm place, to enjoy the Greek sun, the Spanish waves or the Italian waters. Water is the foe nature gives you. It is an unrelenting brutal mistress that shows no mercy and gives no quart.

Whenever you take the word of any hotel that there are life guards (and they should be there at all times), do not assume that this gives you time to breath. Always keep one eye of your child, two eyes if possible. The water excites them, it brings joy and they will not realise the dangers water brings. The moment they do, it might likely already be too late to do something about it.

Be safe this summer, both you and your children!

 

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May 15, 2013 · 20:52

A noun of non-profit

The EU is getting a few more jabs using jibs, as it sails through the rough weathers of recession. Germany is up, France is down and the UK is about to remove their ship. If the Dutch economy does go up, it will be a plain victory through Nutricia as it shipped several containers of baby milk powder to China. As each container contains 20.000 boxes of Nutrilon (Source: http://www.nos.nl) this could be a first step to stem the tide of some safety for the Chinese baby nutrition. Yes, the article could not leave out the emotional side of crying mothers at the cash register. There is in opposition to the statement in the article little or no guarantee that supermarket hoggers will stop trying to ship baby food to China for now, as it is fast money for those involved and there are additional groups of tourists and foreign students trying to lend a helping hand to their families. This is the one consumer strongly aiding babies and the Dutch economy.

However, they are not there yet. The EU economy is no milk run as it is presently presented. It is not just the economy. If you think that just the local (read national) budgets are a problem, no it gets worse. The EU Budget itself is also coming up short. So that clearly reads that we have nations with a deficit, and now that the group that they belong, which also has a budget is ALSO in deficit. In an interview president of the Euro group Jeroen Dijsselbloem stated on the NOS journal in the Netherlands that the Dutch budget will get hit for up to a little over 500 million Euro (which was stated to be a worst case scenario). In addition the IMF stated the worrying condition of the Netherlands. The Dutch NOS reported the prediction that even though the Dutch economy will shrink another 0.5%, they do predict a growth of 1.1% next year. I personally join the group “Oh ye of little faith!” on that one and if they are able to get the economy up to 0.2% positive in 2014 than they would have achieved quite the small miracle.

The shortage, extra payments and several other ‘bad news’ moments we are likely to hear during 2013 would effectively prevent that 1.1% growth. We will know the actual number next year, but I am putting it out, right here, right now! I must admit that the idea of calling Christine Lagarde next year telling her “told you so!” seems definitely more appealing than a 2 week free for all in the Playboy Mansion (but then, as many have stated before, I was always wired slightly weird).

So, the Dutch government, who was unable to keep their budgets (like several other nations), and after getting a 1 year extension to get their budgets in order, this happens. The Netherlands is however not the only one, and this is not about having a go at the Dutch.

The French are also on the recession list. Or better stated, the French situation might soon become dicey to say the least. Even though their economy is not deep into the dip of bad economy, 0.2% is still an issue, especially as this is a continuing line of sub zero numbers goes on. If we look at the IMF Document called ‘World Economic Outlook‘, April 2013 (http://www.imf.org/external/pubs/ft/weo/2013/01/pdf/text.pdf) shows that these numbers who seem to be on par, are not that accurate. If we take the word from Dutch (NOS) and Belgium (VRT) sources we see that the Belgium shortage is now set past the 3% point, which is a big no-no as the EU had set an upper margin of 2.8%. So the account balance which was set for Belgium in the time range from 2012 to 2014 was supposed to be -0.5, -0.1 to 0.2 is now -0.5, -0.3 and ??? So we need to take into account that these were predictions, yet, if the numbers are off either by registration or by prediction (0.2% national difference is a lot of money), then we have another issue. What else is missed?

 

This is exactly why governments should not be allowed to skate to the edge of the ice (read maximum budget shortage) to that extent. All these predictors and good weather ‘reporters’ that the ice is good and the ice looks fine and the ice is thick enough feels to me that it would be part of the flim-flam confusion act. The issue is that even though these statements might all be correct, people forget that all involved parties neglected to check the quality of the ice below the surface. That part is now breaking off, in part due to many others jumping up and down on the ice for an extended period of time to the point that the skater now ends up taking a dive in the water and is starting to drown. There lies the problem! Should you doubt this part, than reflect on these events in regards to the Greece eternal debt.

Consider that the big nations are all in debt, even Germany. Yet Germany took a hard handle on their debts and fought it to lessen the power debt had. The issues that the other large players are stuck in a wrestling embrace with recessions and risk taking banks should not be lost on us. In addition several of them like France, Italy, Spain, Portugal, The Netherlands, Belgium and Slovenia are in a less good shape at present. When we then add Greece and Cyprus, we end up in a garden party with large portions of recession and deficits to go around for all players of the economy game.

I am not telling anything I had not blogged before, yet the issue remains and the game seems to be changing at present. If the UK, by pressure of its population is moved to walk away from the EU then we have a new situation. As long as the UK was part of the EU, they had a stable anchor in play.

Consider a large (really large) barge, that barge was kept in place by 4 strong anchors. UK, France, Germany and Italy. Yes, we to do know that most are in shabby state, yet, overall these nations are large, stable and democratic (that matters). They keep the Barge EU afloat in a stable place on the whimsy stormy sea called economy. If the UK walks away, then we have a new situation. None of the other nations have the size and strength of the anchor required and the EU now becomes a less stable place where the barge shifts. This will have consequences, but at present, the actual damage cannot be easily foreseen. Any claim that there is no consequence and they predict no issues, remember this moment! The Barge (as is), will lose stability and the smaller members thinking they are on a big boat are now thrown left to right then left again as the storm rages on. The smaller nations will get damaged and in addition, the weaker ones (Cyprus and Greece) could still collapse, especially if the UK takes a non EU gander.

There is however an additional look. Some could take at a paper by Edda Zoli called “Italian Sovereign Spreads: Their Determinants and Pass-through to Bank Funding Costs and Lending Conditions“. It is an impressive piece of work. and can be found at: “http://www.imf.org/external/pubs/ft/wp/2013/wp1384.pdf“.

The abstract states: “Volatility in Italian sovereign spreads has increased since mid-2011. This paper finds that news on the Euro area debt crisis and country specific events were important drivers of sovereign spreads. Movements in sovereign spreads affect CDS spreads and bond yields of Italian banks, and are transmitted rapidly to firm lending rates.”

Oops! That is interesting, as this is exactly the fear that drives some of us, especially when we saw Cyprus and recently the worries that the Co-Op Banking group is giving us and not to mention to unresolved issues on Barclays, Royal Bank of Scotland, SNS Reaal (now nationalised) as well as possible future issues with Banca D’Italia (The Bank of Italy), who currently seems firm and strong, yet if Italy continues to fend of the Austerity measures we will see an increased wave of issues that could have far fetching and long term consequences.

In regards to the UK, when looking at Barclays I found this with the New York Times in March 2013 By Julia Werdigier. “Despite the bank’s weak profit and legal woes, top executives at Barclays have been richly rewarded in the years since the financial crisis.” In addition it states “The payouts come at a difficult time for Barclays. While the stock was awarded before 2012, the compensation may still give additional fodder for critics, who have complained about the industry’s outsize pay packages.” That is not all! On May 7th Reuters reported that the Citigroup has sued Barclays PLC for over 140 million dollars for the 2008 Lehman Brothers party, a party from which some banks are still trying to recover from almost 5 years later. In addition there is the LIBOR rate ‘scheme’, which costed Barclays in the form of a fine exceeding a quarter of a billion pounds. Then we get Citigroup now claiming, wanting desiring and demanding over 140 million. Oh Joy! Yes the Barclay executives (around 430) ended up with a total bonus of over 650 million. So how much money did Barclays make? (Read on to learn)

This example shows exactly my fear. If we see the paper by Adda Zoli, we see part of the issue. If the national debt grows, the risk increases. The UK has a debt in excess of 1 trillion pounds. That is a lot! Banks seem to have less and less, and as such you and me (you know your average dopey lender) has less and less chance of any future in these dark days. Now, to be clear, Barclays was NOT bailed out by the government. They took the high road and decided to cut down on staff by almost 7000 (over a period exceeding one year). Like that is not additional pressure on the government? Yet, all these bonuses, which might have allowed them to hold all their staff for another 4 years for the price of 1 year of executive bonus.

In addition, Zoli’s paper is specific to Italy, yet that same approach might also be used to look at the danger levels in several EU countries. Take these facts and now extrapolate back to the big barge called EU. We can speculate that as people on the boat are thrown overboard. It changes the weight of the vessel as it loses, not gain stability. In addition, some get such high rewards, rewards that are kept to them, not used to maintain the barge! These factors will impede that barge even more and those additional factors are overseen and given to us in the form of ‘bad news’ moments that just pop up. Remember the extra EU payment at the beginning? So a barge, now less stable and a drowning population, all in the Economic Ocean, a restless pond, that is East of the Atlantic and West of the Pacific.

It is important to realise that these Barclays executives have not broken any laws. They were ‘rewarded’, yet Barclays reported a Nett loss of 1 billion for 2012. Seems utterly wrong doesn’t it?

 

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May 11, 2013 · 05:06

Wanna buy some Junk (stocks)?

OK! I admit that I am slightly over the boil at present. Not only have we seen several banks with their ‘why would I care what happens to others’ attitude, now we see the message that Co-op bank has now ‘ascended’ to the status of Junk!

Several things are happening, yet, let us take a few steps back, so you can see why this upsets me so. The year was 2009; Britannia (building society) gets added to the Co-op bank group. This happens around the same time SNS Reaal had a property finance group dwindle its value by a quarter of a billion Euro’s, and that was not a bad day for them. 2010 would then become the massive body blow to the SNS as their property group would increase its 2009 damage by 300%. So, at this point, is there anyone out there not wondering why this continued for 3 years?

Whilst all these property issues were happening all over on the EU side, the Co-op bank thought it was a good idea to continue in their footsteps? Consider the issues, which are NOW stated as issues, must have been known then too.
That in itself means that more than just a small investigation needs to take place. There is every notion that the involved parties require investigation. If we see the waves continuing from 2009 onwards, we see a wave of mergers, left right and centre with a shifting of ownerships and a shifting of losses over and over again. At the middle is a small group of people who seem to ‘make’ their quota and getting a nice 7 figure commission in the process. Poor Prime Minister Cameron was admitting defeat in the papers at that time. Whilst well over seven billion pounds in bonuses were granted to less than 3000 people. So in this age the noble art of thief, burglar, prowler and cut-throat is gone. Instead, some become bankers, you get the idea.

So, we saw the Britannia merger in 2009. The consequence was that Co-op acquired a company (The Britannia) ‘worth’ 35 Billion, yet, when we look at the value of Co-op, those numbers seem to be completely off the wall. Can anyone explain to me how a bank, who in their financial results of 2008, stating an operating result of 85 Million, with 64 Million of profit before taxation sucks up a company with a stated worth of 35 BILLION? No one seems to be asking the questions many should be asking. Now, as stated before, I am no economist and my degrees do not include economy, yet the Co-op/Britannia combination makes as much sense as me walking into IBM HQ, walking up to Ginni Rometty’s office asking her ‘How much for just the company?’, paying her for IBM, take over her office and have it redecorated. And trust me when I say that her weekly allowance is a lot higher than my pre-tax annual income.

So, as this happened, no one seems to be asking the tough questions. In the meantime to the next time-slice, the following issues occur. Our trusty Dutch nationalised SNS, now values at minus 127 Million and its property market is now reported at minus 600 million Euro. At this time, alarms should have been singing, ringing and clinging on many levels, not just at Co-op banking group. For those thinking that they are just separate banks then I would state that this is not entirely accurate. Consider that RBS took part of ABN AMRO (former one of the big four banks of the Netherlands). In the time (pre purchase of Britannia), Royal Bank of Scotland Group Plc, Lloyds TSB and HBOS Plc needed a massive bailout by the UK government. Soon thereafter Co-op suddenly goes fishing for a great White, using nothing more than a Dinghy and a $9 bamboo fishing rod?

In that same period Co-op is involved with the purchase and annexation (to coin a phrase) of Somerfield stores. It was reported to have a net income of just more than 220 million pound a year, yet, it was purchased for a 1.5 billion pound. That part makes decent sense as the net profit is a little over 10% of the purchase value. Yet, in light of Britannia and other events taking place, I add some serious question marks with these methods of vulture growth through acquisitions. I have seen this happen over the decades, and overall it rarely turns out well. This story turns that way as we see the Co-op food group (name after the merge of Somerfield stores) had reported in 2011 (as stated by The Guardian on 25th August 2011) a 21% fall of profits. Suddenly, the 220 million pound profit shrinks and looks less appealing. The Guardian in the same article also reported: “The Company has committed to investing £2bn in the business over three years, with £280m spent in the period.”

So the initial spending outstretches a full year of profits, with investments stretching beyond the 130% of the purchased value of the food stores. With refitted shops, additional refitting and new shops, the total number of shops seem to go beyond 550 stores. This is happening at times when caution is the only way to go forward.

The additional cost of getting these systems to run and align in an infrastructure would require massive amounts of resources. That part became clear if we look at the story from Computer World (http://www.computerworlduk.com/news/applications/17614/updated-co-operative-bank-losing-customers-through-system-problems/). This story is set to the Bank itself, yet the issues of so many sides and so many systems, and therefore the enlarged infrastructure required is not a relief of costs, but a pressure added to it.

Another side of pressure was displayed by Reuters (http://uk.reuters.com/article/2013/02/27/uk-cooperativebank-lloyds-idUKBRE91Q00E20130227). On the 27th of February this year it was stated that Co-op was somewhat short on cash. They were 1 billion short. (oh, let me get my wallet! Duh!) This seems to be the major reason that the addition of 632 branches of the Lloyd’s Banking group could not be purchased.

These facts are more than worrying. The vulture acquisition game is worse than a game of Texas Hold’em Poker. First there is the fact that the board of directors is gambling with other people’s money, the second part is that the circle of damage increases with each acquisition. Consider that the UK only has a 0.3% economic gain at present and that the economy is extremely fragile for now. Allowing these mergers to continue until a solid block of stability is gained should be disallowed on several levels and not just with co-op. Until the economy bounces back and the costs are more stable, this bank should clearly be placed under scrutiny of the most conservative nature.

It is said that the Co-op banking group consists of almost 125.000 employees. Now consider that any hardship hits this group. A thought that is not too unrealistic, especially as they are on shaky grounds for now. I am not just talking about their Moody status, to which their response was on May 11th 2013 as ‘Disappointing’. I am talking about infrastructure issues, weather related issues and any issues that will drag the rest down if additional write downs will be required to the property group from the Britannia acquisition (consider what happened to SNS Reaal in the Netherlands), a mere 5% write down will come down to over 1 Billion, whilst their cash reserves is already 1 Billion too low. So if that result in shut-downs and lay-offs, then a 10% loss of staff is not unrealistic, which means another 12,000 will be out of a job. That must be prevented at all cost. Such damage could push the UK 0.3% increase down to a lower than 0.1% decrease soon thereafter. In addition, those cut downs will hurt their non-aligned infrastructure even more and that might even start a snowball effect on people and infrastructures. I admit that the previous paragraph is all speculations on my side. I have however seen these kinds of reorganisations and crushing results first hand. I had faced them when the economy was good, under current conditions; these events are a nightmare to consider.

Is there any good news here? Well, I feel that I am not that optimistic on the statements they made, yet, overall Co-op could be in a worse place. The only proper solution for them in my mind is to dig in and weather the storm for now. Getting by the next 2 years is more important than allowing one rash acquisition to endanger it all. You will wonder about my evidence?

That is a fair question!

Many businesses are in a bad shape, and there is every chance that some will fail. Now consider the Property acquisition (Britannia). No matter how high their assets are set. Part of their acquired branch was commercial lending and mortgages. Last December Reuters quoted this, a real issue taking in regards the high pressure on lacking stability funds “At this rate it will take another decade to return to normal – and I’m not sure there is much anyone can do about it.”

So increasing more pressure could in the end result in the taxpayer getting a hefty addition to the outstanding national debt. A national debt, that is currently in excess of 1 Trillion Pounds.

So, from my point of view it is important to consider the story we saw recently in the Netherlands. The SNS Reaal board counted on Government bail-outs as they regarded themselves too big to fail. We need to make sure and make it clear that the Co-op banking group is not allowed to be this arrogant, or allowed such a way to a bail-out.

 

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May 10, 2013 · 16:09

Got Milk?

This has been an interesting week for some. This news actually started last week where more and more visibility was given to the fact that shops were running low on baby milk. We are talking about the powder tins that are processed into yummiest milk that babies are supposed to like, love and make them grow healthy.

The UK articles and newscasts showed that shops had limited the baby milk limit to one tin per customer per day. France was already dealing with this issue for some time. The reasoning behind this was the fact that shoppers were buying them on mass to sell them on eBay for staggering profit margins. The interesting part now is that this group has grown into the Netherlands as well, and they now have an issue too.

There the story becomes slightly hilarious. This is what the Dutch Minister Ploumen of foreign trade had to say “Het is natuurlijk prachtig om te horen dat Nederlandse producten geliefd zijn in China, dat is goed voor de werkgelegenheid in ons land. Buitenlandse handel biedt binnenlandse banen. Maar daarentegen kan dit niet ten koste gaan van de Nederlandse moeders en vaders die tegen lege schappen aanlopen” [translation: “It is excellent to hear that Dutch products are desired in China, this is good for Dutch labour opportunities. However, this should not go at the expense of Dutch fathers and mothers who see the empty shelves“]. (Source: http://www.NOS.nl).

So, we have an issue that had been sweeping the market in general for several months. Which is interesting as Nutricia, the Dutch producer who has a world famous reputation for chocolate milk is one of them. They currently have a growing market with spiking needs in excess of 50%. In a time with low economy and overall downsized retails. The minister of foreign trade is talking about empty shelves. But I do agree that this is both a fact and an issue, but is it his?

This hilarious part is that when researching this I found that the Dutch laws have been focussing on different sides of import, especially grey import. This is however an export issue, and so far it seems that the Dutch trade is only outspoken (in a slightly complex way) when it comes to the export of medicines. I did find statements in regards to anti-dumping, that dumping is not an illegal act, which is a discussion for another day.

The interesting side is the lack (as seen at present) on the rules for export. As other nations all have their own rules for import, the export seems to be open to promote trade as much as possible, which makes perfect sense. So it seems that the Minister Ploumen speech of empty shelves is limited to this as there as limitations of export seems to be missing. (There are exceptions as there are clear rules for exporting weapons and medicine).

Except for the few who were quick enough to use the eBay option to sell these packages quickly, this rage of exports is set to people (especially Chinese), who buy these products and mail them to relatives and friends in China. All this based on the baby milk issues within China when their milk was contaminated with the deadly substance Melamine. This initial issue had been reported in 2008 and that had resulted in large numbers of sick baby’s with some fatalities. It is interesting that these levels of mistrust are still an issue now in 2013. Even though there was a call for censorship to prevent larger issues of emerging unrest, I did not find any clear evidence that new baby milk issues emerged, other than the still existing waves of lack of confidence in the local created products.

So considering the facts that these issues have been plaguing the EU since last October, there are two issues to consider.

The first is the question is why the producers did not raise quota needed to fill the shop shelves? It seems extremely unlikely that the producers over 3 nations cannot meet the additional amounts. As I never had to consider this food group, it took a little while to get into the brands. Interesting is that as part of the dozens of brands a sizeable amount refers to: Nestle, Nutricia, Nutripharm and Farleys. Yet, I am not aware of the processes and the amounts that can be produced. So consider that these are the EU’s big four, what is stopping them to increase production? I know that it is unlikely that we just increase the speed of the production line. This is depending on a lot more factors. It is however interesting that these big boys cannot meet demands. It is not certain whether they are working on 24 hour shift solutions, yet three nations, all plagued with employment rate issues and in times of a downsized economy the one product everybody wants, no one can get. So why are we concerned with export legislation at present? (at least in the Netherlands).

You see, this is all about the Chinese import issue. If they start stopping this import then they might be one step away from some serious civil war issues (as most people get REAL cranky when their children are being endangered). If they decide to stop this on quality reasoning, why are they doing this? Their own producers seemed to have endangered their own children. To their defence, at present this seems to be linked to low consumer confidence, not linked to any actual issues at present.

The second issue is about the future. I can agree that the Chinese would prefer joint-venture solutions, yet at present that solution seems unlikely to do anything short term considering the Chinese low confidence in their own products. I agree with any nation that it does not like to depend its future generation on an import issue. That solution reads like little Hans Brinker putting his finger in a dyke whilst 200 meters downwards the dyke is gone, it is very counter-productive. If we care about the population then the Chinese are much better up opening the borders for the next 6 months and avoid optional additional issues with some clever criminal repackaging high end used tins with low end materials. Releasing the pressured need of baby milk, and then get those 4 big boys (or any of them) across the borders, each signing up to address the issues that plagued the factories and get them back on-line with confidence levels that will get the Chinese population back to their local brands. Let us be fair, opening that market seems to be a win for all and basically no one loses there.

What are the additional issues?

To me it seems that export issues are less and less arranged, and I do not think that this is a bad thing. If over regulations hurts trade, then proper actions should be taken, and most nations have decent import regulations in place, so export issues are less likely.

For the UK this is a better arranged side as they are gifted with the UK Export Control Act 2002.

Here we see a few clear options. In S4(2)(b) we read that “(2) For this purpose ‘trade controls’, in relation to any goods, means the prohibition or regulation of their movement;” So this point makes it clear that export can be ‘stopped’ to some effect.

However (there is always a however) Section 1 speaks of Export controls. This states for S1(2) “For this purpose ‘export controls’, in relation to any goods, means the prohibition or regulation of their exportation from the United Kingdom or their shipment as stores.“. And in S4(4) we read that this is linked to S1, which seems to give individuals a clear pass. (Yay for individuality!)

So it seems that the UK companies have clear legislation (which might not be an issue), yet the Dutch and French legislation only seem to have stated rules and limitations when it concerns arms and medicine, beyond that if they were allowed to make it, it can basically be shipped anywhere.

 

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May 9, 2013 · 01:37

Previous Generation towards future Games

At this point it feels important to me to take a look at the lighter side of life. This article is also slightly more intended who remember gaming on systems like the Commodore 64, Atari ST/Amiga and the pre Pentium 1 gaming days. I remember those days well. Simple days! It was all about working the absolute minimum one had to do and the rest of the time was about enjoying the outside life (to some extent) and then to go home and enjoy a video game…..or two. In those days if a boss required you to work overtime, then you went to the chemist at lunchtime and bought him some Valium or Xanax, so he could relax. Good Times!

A few weeks ago I stumbled upon something called D-Fend reloaded, which is a DOS emulation program, with an additional link to a place called ‘My Abandoneware’ at http://www.myabandonware.com

These two places allow you to play the old original games from those early gaming days. The fun part is that I had several of them, yet the advanced options of D-Fend allowed me to slow down the processor to such an extent that those games finally worked again and they worked flawlessly.

Now, for most this is not new, or in some cases they think that these games have nothing to offer.

I beg to differ. The X-Com games and The Ultima series are more than most realise. These games brought a level of original gaming that even today can hardly be surpassed. You see, a good game is not about smooth graphics. It is all about playability. This is without a doubt a lesson we can learn for free so it seems, so this is a number one trip for all readers. The abandoneware site had actually a second option. Each game has a link where the original owner can identify himself, should he object to his game being freely available here. I found one such game, and I bought it for the iPad at the Apple store.

The interesting part is that these games still touch me in some way. These were the original titles and they are part of gaming history. More important, this list of over 4000 games will show you one clear thing. These people were innovators in more than one way. They were able to deliver a game that was able to run on a 640Kb system (yes, I know that most do not even have a memory card that small).

So, consider how the bulk could be transferred to something as ‘simple’ as the Nintendo DS. Add slightly better graphics and several of these titles will soon be more coveted then several high marketed products on the game store shelves today. After 20-25 years that is some achievement.

Of course many of these 4000 games are below par by most standards, but that is the consequence these games have, some were from, or meant for the Commodore 64. It only had 64Kb to work with. It was not until 1990 that this world changed for the personal computer. The main reason was the coming of the SoundBlaster. The SoundBlaster was a soundcard that went to places the Adlib card could not reach (the ruling soundcard in those days). It gave the PC sound abilities that surpassed the initial 16-bit home computers like the Amiga and the Atari ST.

Yes, many will not be swayed as they are so into ‘graphics’, yet these games depended on game play, which is not that far-fetched when you are limited to 640Kb high-end computing powerhouses (as they were then).

Legally this group of games is interesting too. Even though many might not bother or realise this but these games still have copyrights. More important considering the term of copyright, and it currently goes to figure why some of these games are not reset for the new and smaller systems. This is where the one owner option on that games site comes into play. The game that was removed from the system as per request by the original owner was a game called Ascendency. It has a tactical and it has a strategical side to it. I will not go into the game itself, but what is clear is that he made an excellent export to the iPad. Most of the game remained the same. Only small changes were made to get this game to run on my iPad 1. The result is one enjoyable journey into a game thought was lost to me. It works great! Consider that I had no problem dishing over those $7, even though I still have the original PC disk. This version is a happy addition to my collection.

The two big winners here would be Sid Meier and Richard Garriott. Their old games are still as fun and rewarding to play as the moment I got these games in the early 90’s. A dozen games all almost ready to be ported to handhelds and tablets. All ready for a new generation of gamers who will quickly learn that these games filled with game play can easily outlast some high end graphic game we conquer in 20 hours for $99 retail. Comparing new games against transferred game I can see a dozen games, each having 50-100 hours of gaming value at $10 each. That comes down to almost 1000% more game play for the amount of one new game. I say that makes it a win-win for us.

A win one as we get great game play, and win number two as the game industry needs to start thinking long and hard on how their marketing hypes are winning less and less, whilst we the gamer become ever weary on what we are offered and for the amount it is offered for.

Will this stop games like Elder Scrolls 6 or a new God of war? No! Good games will always get our attention.

Their question should be what makes it a good game for us!

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May 7, 2013 · 22:19

Cody Wilson, 003½ with a plastic gun

It is not often we see innovation in a new light. We have seen innovations over time as people found something that was new, that was nice, and then they changed the world, they sometimes change it twice.

Some might have seen it, some might not. There is a ‘new’ novelty printer. This printer is different. It has the ability to print in 3D. It does so by printing plastic. As it prints layer by layer, it creates a 3D plastic model. I saw it in a novelty science store called ‘Professor Plums’ in Crows Nest (Sydney, Australia). As such I have seen small vases, holders and other small trinkets that seem simple, yet, when you consider that these are ‘printed’ objects, you would look again and think ‘How amazing!’.

A law student in Texas took that design to new level. Perhaps this man saw John Malkovic in the movie ‘in the line of fire‘, he put one and one together  and ended up with 15 ‘printed’ parts and that is how he made a plastic gun. You might think what nonsense it was; however, consider the second part of that equation as he added one part that was not printed. The bullet! Then he did what others stated was ‘Science Fiction’ and he fired the gun, making it a working success. The article is at “http://news.sky.com/story/1087396/controversial-3d-printed-gun-fires-test-shots”.

Innovation, an idea to break open the law and the most dangerous item you could ever consider, a gun that does not show up on metal detectors. No matter what he thinks in this regard, I am not attacking him for his convictions. Like him I believe that guns do not kill people. People kill people. The part he might or might not have considered is that the American Arms industry currently represents roughly $11B in 2012. This represents guns and ammo as far as I know, but now that revenue is in some serious peril. No matter how criminals get their guns, they do pay for it. Now, someone needs one 3D printer, plastic toner and the schematics. The result will be a collection of guns without serial numbers, without set bullet striations. I reckon that forensic evidence will never be the same again once these guns hit the streets in numbers. Consider in addition that plastic melts. Dump the used gun in an open fire and the option ‘Beyond reasonable doubt’ will now happily take a gander into never never land.

In the Sky News article it stated New York congressman Steve Israel view “Security checkpoints, background checks, and gun regulations will do little good if criminals can print plastic firearms at home and bring those firearms through metal detectors with no one the wiser.”

Congressman Israel is correct. This is a new day. When Jeff Maguire wrote his idea “In the line of fire” in 1993 he might never have considered that his idea could become a reality. Yesterday the news showed him that reality caught up with his imagination!

So should we blame Jeff Maguire? Seems hardly fair! Should we blame Cody Wilson? I think that his idea to put this on-line would be irresponsible, yet, proving that the idea worked was all it took. It now only takes a slightly clever person to re-engineer this concept. So perhaps we should consider that there is no blame. Perhaps in the US gun control the way they tried to pull off their political games in the last year is now clearly shown to be an utter mistake.

That is how I saw this then; this is how I see it now even more. The clarity remains that guns do not kill people, other people do that!

I am not turning this into a gun debate. This is the issue when technology and innovation catches up with us faster and faster. The fact that new and additional laws are needed gives us two issues.

1. More loopholes. Whatever changes or additions are made, once they introduce a new material, a new way to make 3D models, we will see more changes and more legal issues.

2. “Beyond reasonable doubt”. The plastic gun can too easily be transformed. How long until we buy a small glass container with an Isopropyl Bromide (or variant)? That would be one way to melt plastic. Soon thereafter the prosecution has nothing left. Nothing to work with and due process stops as the gun that was used no longer exists.

This means prosecution of another level. This is nothing compared to the countries where there is a ‘proper’ form of gun control. These nations now have the issue that a printer can get the people the firearms they never had to worry about. Unlike the Golden gun in the James bond film from 1974, these weapons are made from the cheap stuff and they do work.

So from the 60’s we had Star Trek and now we have the mobile phone (we’ve had that device a while), the 80’s we had Star Trek the Next Generation, and now we have the iPad. 1993 we got John Malkovic and his plastic gun, which is now a reality. What will we get next? More important, what laws will these innovations break (or not break as they are too innovative to cover)?

This brings me to the modern Jules Verne. Arthur C. Clarke had 3 laws of predictions. The third one was “Any sufficiently advanced technology is indistinguishable from magic.” He came up with that gem in 1962. Considering that into a legal frame I come to is “Any sufficiently advanced technology is not contained as illegal through law“.

This point has been proven in several cases.

– Designer drugs. Often take too long to classify, giving the trendsetters an initial option to score large amounts of money, mCPP is a perfect example of this. (Criminal law)

– Tying (product tying), in many cases, this practice is still (legally allowed) used widely in both Mobile and computer industries. Even though there is criticism against the existence of these laws you still see it used widely in getting a subscription with a provider and getting a ‘free’ phone. Also consider Microsoft and the merging of office software and the IE browser in the core of it all. (Competition law).

– Digital piracy – Peer to peer sharing of movies and music (IP law)

– If we consider the events of LIBOR, Cyprus and the 2008 Bank crash, then we can safely say that banking laws are just not up to speed (especially as unregulated as they are now)

– Now printers that produce firearms.

Consider the next step, which is not that far away. In the movie ‘Ultraviolet’ we see a scene where a mobile phone is nothing more than a plastic mould, ‘distributed’ from a machine, just fold it and it is ready to use. How long until the plastic and electronic print board is just printed on any device. So jacking someone else’s phone is one step away. You will be paying for the ‘used by someone else’ costs. Not identity theft, but consumer technology theft.

From earlier and the last example we see that the law is not up to speed and a rewrite that allows for rules of evidence of another nature is becoming a more pressing matter then we realise, as we see that the law is increasingly running behind.

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May 6, 2013 · 15:59

Shalom Syria!

There have been several issues in the last two years that give reasoning to ponder our collective futures as we see issues flame over the Middle East. It has been clear in several ways that Israel is constantly under attack, it has been under attack pretty much after the state of Israel was founded.

So in a highly pressurised area, the Civil War in Syria was not the additional pressure anyone was waiting for. This civil war has now passed the two year mark. So, we can honestly say that this is a ‘grievance’ that goes high with the entire population of Syria (no matter which side they are on).

Yet, there are still other sides. At present President Bashar al-Assad has seen an expected short term issue into a long term consequence. Even if (however unlikely), he would be victorious against the opposition, there will be a massive amount of repairs to be done all over Syria. In addition, with the currently shown evidence, which gives us enough evidence that Syria employed methods of chemical warfare against its own citizens, there is every chance that nations of the League of Arab states will not invite him to the negotiation table as an equal any day soon. This means that whatever support he hopes to have needs to come from other ways and means.

So, what about Hezbollah?

They proclaimed their support for the Syrian state and President Bashar al-Assad. Here is where the plot became confusing for many. Hezbollah currently seen and should remain to be regarded as a terrorist organisation. Yet, their open support for a sovereign state is a valid question mark for many.

This is where the issue of yesterday and the issue last January exploded quite literally. Israel finds it utterly unacceptable that advanced missile systems are delivered to Hezbollah via Beirut. This is the reason Syrian got to watch a bright orange sky as a ‘research-building’ (as the Syrian government calls it) was turned into the main component of a snow globe.

Israel is quite right to be concerned with advanced weaponry seemingly given to Hezbollah. The note here is the ‘advanced’ part as Israel seems to remain eager to stay out of the internal struggle of Syria as much as possible. There is the side that the press at present seems to lack ‘illuminating’ to all.

No matter what the Syrian statement is, as they complained validly that they lost a building, yet no one upgraded it to a hotel as the rules of the Monopoly game states. The issue I have is that a convoy of weapons, not once, but twice would make its way to Beirut. Take into consideration the following report by Reuters last year. ( at http://www.reuters.com/article/2012/10/19/us-lebanon-explosion-idUSBRE89I0N620121019)

So, slowly the question could become, is Israel not already in a war with ‘Syrian’ elements as such, considering that the new name of Lebanon might be “West Syria”, or what in the US might in future be known as West Side Syria. There had been issues all over the news in the last year that Syrian intelligence had the run of Lebanon. As such Israel’s strike makes even more sense. It also is given additional strength if we consider Reuters article at http://www.reuters.com/article/2013/04/05/us-israel-lebanon-hezbollah-un-idUSBRE93311920130405

 All this gives reason for worry. Should this escalate even further, an option that is at present unlikely but not impossible will change to “likely” if the Syrian government keeps on updating Hezbollah the way it currently seems. The consequence will seem far-fetched at present, yet uncomfortably logical.

Should the issues with Hezbollah/Syria escalate, then that would give Israel two new frontiers to worry about. First the people of Lebanon might enter their own moment of Civil war for the simple reason that one air-strike lit up the sky more brightly then the combined effort of an entire year of Syrian explosions. That and the fact that it’s citizens might even end up having to look at a levelled Beirut because Hezbollah violated UN Security council resolution 1701 for some time, as well as the issue that at present elements from Syrian Intelligence seems to be a ruling voice in Lebanon, might make the population angry enough to clean up their government.

These escalating issues will be a clear sign to Hamas to start their fireworks barrage (read S.C.U.D/Qassam/Fajr-5) on Israel. This will push Israel into a state of utter defence, which means that their attacks can no longer be proportionate. They would have little other option then to change both the West-Bank and Beirut into an ash pile. There are plenty of people claiming that Israel will not do this and how this should be resolved diplomatically. To them I say “Talk is cheap!” Syria crossed a red line according to the NATO Intelligence, yet at present nothing is done. Any talk is only a factor of delay. I do understand that the US is not happy, willing or able to just enter a new war zone. I am also not stating that they should consider it, yet if they do not, when (‘should’ is a better word) things escalate they will remain outside the zone discussing and not being able to direct the theatre of war, something they prefer as it will always be better to direct the game then just run with the other players.

For all who claim that THIS time (the Sarin evidence discussions) it is not a delaying tactic, I state “By whose standard?” Let me guess; only at some point AFTER missiles hit Tel Aviv, THEN they will agree to talk? Then there would be a suddenly (temporary) agreed seize fire? There is at present enough evidence for Israel to seize proportional responses and do whatever they can to secure the state of Israel.

For anyone thinking that this is an option Israel would never consider, and then consider that Lebanon is giving Hezbollah and Syrian Intelligence pretty much Carte Blanche in Beirut. Even though Lebanon does not currently have a dangerous striking force, and in addition, the Lebanese government has at present no intent of open hostile acts against Israel (as far as I know), then consider that when (not if) the Syrian establishment falls, a massive amount of military and intelligence personnel will move into Lebanon and Iran trying to escape prosecution from the people they prosecuted. As the victor of this encounter will be prosecuting (read hunting and lynching those who did the atrocities). I am not saying it did not happen on both sides, I am stating that the victorious side will end up giving blanket immunities to their people. Both Iran and Syria will be getting an added group of people happy to start open hostilities with Israel.

So a solution must be found. I personally believe it is not just about the Syrian Civil War. No matter what people shout, that ‘party’ is not going anywhere for many months after the civil war have been resolved. The issue on how Lebanon seems to have been compromised into a puppet state that is run by Terrorist and hostile Intelligence organisations seems to miss the news regularly, and that is a matter that has a much higher priority then people think, as that part has the ability to remain a destabilising factor long after the Civil War is done with. The reason should be obvious. Two groups that should reasonably be isolated, now end up having access to Banks, Media and a sizeable harbour. Two groups with too much access to all kinds of resources, both living with the premise that their values is based upon their ability to wage terrorist assaults on Israel.

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May 4, 2013 · 15:59

UKIP or U.K.I.P? (Ur Kiddin’ I Presume?)

First let me start by stating my ‘allegiance’. I for the most am a conservative in mind. I used to be Labour/Liberal Democrat in past, but like all people, over time my thoughts and ideas changed like they change with most people. And as most, we want to support the team that looks out for us, and is closest to our ideals. We often keep it in that order of importance.

The issues are not with the parties, they, for the most did nothing wrong to make me change my mind. They had priorities as any good party would have, and as they change I felt less with one and more with the other party.

So why, from Australia is this part on UKIP coming? Well, I grew up in Europe and I spend most of my life there. Perhaps at times I still miss being in London, but that would apply to anyone who has been to London. Only the dead do not miss London and even that might be debatable. So as I saw the news this morning on how UKIP made some staggering victories from the conservatives I started to ponder it all. So this is where I am at present.

What do most know about UKIP? We saw some people lash out against them as they lash out against most opponents they are worried about. Then there was (too) little from UKIP and of course the votes and those who flocked towards them in droves.

When you look online, there are heaps of reviews. The Australian wrote ‘Send in the UKIP Clowns’, ‘the anti-immigration UK independence party’ and a few other less than flattering headers.

So taking a look at their site at http://www.UKIP.org had several papers that could be read, downloaded and or printed. It seems that they have information that is ready for all. One of the quotes that was on page 2 of their manifesto was “On January 1st 2014, The UK will open its door to unlimited numbers of people from Romania and Bulgaria”.

In the current economic and financial climate that makes entire Europe suffer, this message would scare plenty of people in the UK. There is even a quote from Ed Miliband MP, leader of the labour party in there. Yes, there is a simple message. So, why am I interested?

From my view many Commonwealth nations are connected. Even if Australia has a strong mining community (a force our own PM seems to be happy to break into suffering little parts), we are connected with the UK. If your mother was in danger, would you NOT come to her rescue? I think that we will always come to the aid of England, even when they lack Cricket skills ;-).

The message from UKIP remains simple, yet life is not that simple, but it ought to be. This is why Mr Cameron is now in a situation where he has to pick up the pieces. I will go one step further, even if the press was not willing (or able) to make it. If the current standing is not rectified fast, the conservatives might find themselves in less than a minority position, they will end in a position that will take multiple government terms to rectify.

So let us take a look at these issues that gave strength to the UKIP.

Open immigration from Romania and Bulgaria. Open immigration is always an issue for any nation that is in a much better place than the nations where immigrants come from. Yet, these two are not in any good state, so if those people have a chance of a much better life they will come. Yet, in support, the Netherlands has been dealing with massive scaled rental allowance fraud from Bulgarian gangs. The Dutch information program ‘Brandpunt’ (= flashpoint) even showed how organised bus trips from Bulgaria exist, just to start this method of fraud. One website even mentioned “Bulgaarse televise zendt cursussen ‘Hoe misbruik te maken van het Nederlandse systeem'” (=Bulgarian television transmits courses on ‘how to abuse the Dutch system’).

In the current climate this is what the UK might have to look forward to in one way or another. So, when we see UKIP announcing that they want to get out of the EU in the current climate, many people listen.

Is UKIP correct? This is where my shoes become a little tight for comfort. Life and politics are not that simple. No matter how much we would like it to be, the UK is currently in a 1 trillion deficit issue. It needs an increased economy and it needs export to keep it all real, yet the prospect of losing a 0.3% economical increase (achieved by the conservatives) is not likely to survive after the open border policy starts next January. There is another reality that does not bode well for Mr Cameron either. Many Nations in Europe have no real grip on their budgets at present. Germany seems to be the only one on par for now. Even the UK has a problem, but that is an UK issue. As they remain in the EU, they also inherit the issues of Italy, Greece, Spain and Cyprus. Each of these 4 are now loudly protesting in a state of anti-Austerity and as such, should their governments be overturned, then the chance of them cleaning up their own mess is not likely to happen any day soon. UKIP wants to be away from the EU when that happens. The reality is that the brunt of those blows would push the Netherlands, Belgium and France on their financial knees as well. Then what?

So even though Mr Cameron is right that life is complex, the appeal that Nigel Farage wants to do an Alexander the Great and cut the Gordian knot is not that far-fetched and is starting to appeal to a much wider audience. There is even additional support as the Netherlands did not get their budget in order and now gets a one year extension. In addition, their own labour party is entering a state of possible disarray as its members oppose a plan earlier approved in a coalition deal with the VVD (Dutch Liberal party). In this situation to get certain deals, the Dutch Labour party had to accept the standing that the Dutch Liberals want a harsher expulsion policy for illegal and criminal immigrants. To make this coalition work Labour had to go along with this to get some of their own agenda points to work. Now the party members want to move away from the Liberal stance on immigration (as the Labour mindset was never on par with that) and MP Samson was unwilling to do this. He had a standing agreement and he wants to keep his word. He also warned that pushing this would come at a cost for labour. Labour would have to hand over something else and even in the short run this would be likely an expensive change for the Labour agenda. So even though this is currently being talked about, it is clear that a crises point could come. In addition, there is no indication that the Dutch economy is changing for the better. There was mention of 0.6% of shrinking of the Dutch economy. In case you were wondering why this issue matters, it does! (Read on to learn why)
You see, if the Dutch economy gets any worse it will soon go towards a situation France and Italy are in (with a lot less deficit). Consider these nations nearly all with an overall average unemployment rate of 12.1%. These people will seek solutions and are very willing to cross borders for a better option. So, the fear that UKIP propagates is a real one.

In addition, the Gordian knot will have several benefits in these regards, but what is the downfall? There is the reality that the response from the Eurozone might lean towards a preference choice in business partners and removing the UK from the top of that list as/if they move out of the EU. It comes with the ‘we take care of our own and ours first’ taking the UK out of that equation. That is a reality to face too.

Does one outweigh the other? I feel certain that UKIP made no real investigation into that part at present. The question becomes what is done after they get the votes, and when they grow large(r), will they be able to provide not just ‘answers’ but also come up with solutions? The latter might be an issue as Nigel Farage stated on Sky News on May 3rd that a reshuffle was needed as they grew more than anticipated. That statement is fair enough when we see that thus far they gained 139 seats. It is a massive victory indeed.

Yet if there is another side then it can be found in their manifesto on page 4.

  • Protecting the greenbelt – opposing wind farms and HS2.

If the UK is to move forward then a proper energy policy is needed. They could consider more nuclear power, yet in the end, alternative fuel will be the future. Considering that the UK gets more wind daily then an average flying jet turbine, wind farms need to remain an option. In addition, if the UK will opt out of the EU, things will get more expensive in the short run, perhaps in the long run too. A strong energy policy would be paramount to keep the cost for the average citizen down and moving away from wind farms as an option seems less like a good idea.

Next on the list are 4 of the points mentioned.

  • Tax should be as low as possible.
  • Cracking down on crime and anti-social behaviour.
  • More police on the streets.
  • Cutting council executives and managers, not front-line services.

These issues are nice to hear, just like the quote we see in a fortune cookie. The tax statement is nice, but will it change? As ‘low as possible’ is just like ‘as soon as possible’, if the second one could mean ‘never’ then the first one could remain ‘too high’. There is actually more to this. Cracking down on crime is something the police have always done. Could more be done? Sure! There is however the issue that a budget needs to be kept and the UK has its own Austerity measures to consider as the 1 trillion deficits is not going away any day soon. This is where the third statement comes. Sure more police on the street sounds nice, but there is an infrastructure. Adding to the police force is nice, but with what money? The police forces have been bled dry and cut to ‘too little’ and not only in the UK. So if they tamper with the infrastructure to keep the promise of more police in the street the result is likely to be counter-productive down the line, then what will UKIP do?

So you see, they talk to the public, and tell them what to hear, but will it solve anything? This part is the debatable one. Yet, down the line, we must admit to govern one must be in office, and they did get into the office and now they must prove it.

I will not join the queue where they are labelled as fruit cakes and such. Mr Cameron is right that they will become a party to be reckoned with. The interesting part is how this will play out. The old duo Clegg-Miliband is now a lot less likely to survive, that part Mr Nigel Farage did achieve. What will Labour do next is the question. They are still the biggest for now. If they are to survive then they must align. It is unlikely they will find themselves with the Tories, yet it is either that, or their new option UKIP.

And here is where we see exactly the issue that Dutch Labour and Liberals are having (PVDA/VVD). What items are given and what are taken and what happens when the MP’s strike deals their constituents will not agree with? A British political sciences student in the late 90’s once told me “Coalition cabinets are the most entertaining, volatile and corrupt forms of governments”. I thought that his point of view made a lot of sense. The UK is about to join those ranks as they need to form coalitions at both sides of the isles. Will it be about the people or the MP’s and their futures? Time will tell but there is clarity in no uncertain terms. Those who did not give clear explanations of the why (as it was too complex) are now in a state where they must redraw lines and re-educate the masses as they figure out what to do next to get their seats back.

So the title ‘You’re Kidding I presume?’ Is very correct, yet who is stating that line, and whom are they stating it to is left in the open as both sides could claim that title and both side should be able to answer it.

 

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May 1, 2013 · 21:14

Another banking issue

People might have read a previous blog where I discussed the issues involving LIBOR and a resolution donation of over half a billion dollars of fines by the Royal Bank of Scotland.

Today’s article by Jill Treanor of the guardian at “http://www.guardian.co.uk/business/2013/may/01/vince-cable-rbs-prosecutions” gives notice of issues at play. Moreover, these issues have been at play for some time now and there is clear need for answers on several levels. The article mentions the issues as quoted: ‘Scotland’s Crown Office and Procurator Fiscal Service have been reviewing whether a case can be brought against any former directors since January 2012‘.
So, it seems that this investigation has been going on for 15 months. A letter was written to Lord Wallace in this matter. My question would be the why it is taking his Lordship the Advocate General of Scotland this long?

There is no doubt in my mind that it is a complex issue, yet overall, when it comes to banking issues, too often the public perceives this as the ‘out of sight, out of mind ploy’. The fact that this is the second bank involved in the LIBOR scandal and the fact that the fines are currently sailing close to 1 billion pounds in the UK alone, visibility should not wane for years to come.

This is not (just) about LIBOR. This entire issue is about the investigation into the directors who were in office at the time of the 2008 bailout. So, this is about a case 5 years old and this case seems to have only started in 2012 and now 15 months later there is still no final answer. This is interesting as the UK has the Limitation Act 1980. This statute has different limitations for different crimes, yet many of them is set at 6 years. This means that if defence can twist it that these crimes would fall under one of those statutes then prosecution has a lot less than 1 year left to take a stance and get started. The fact that these issues are still not for prosecution with the CPS are an additional matter of question.

If we look at the Limitation act and we consider this to be a tort, then Part 1, section 2 states: “2. An action founded on tort shall not be brought after the expiration of six years from the date on which the cause of action accrued. (Time limit for actions founded on tort)“.

The same time limit applies to actions founded on simple contract. The interesting question becomes where these issues are founded on. Is mismanagement a wrongful act, and there for a Tort? Are these wrongful actions and forms of mismanagement breach of contract?

Yet, we should not despair. There is a wise addition in this act that is stated in section 32 of that same act, which deals with ‘Fraud, concealment and mistake‘. Hip, hip, hurrah!
There it states “the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it.”

So we might have a little more time left. Yet, we should not…. how is that expression again? ‘Dilly dally’. Yes, that was it. My grandmother told me that more than once. So we should not dilly dally to find the answers whether we have a case against those directors, lest we forgot that time ran out.

So you see, I am not convicting them, but I do want to see a case brought to trial where they can either be convicted, or where they can submit evidence that would exonerate them. Either will be the case, yet no case means there will not be any answers forthcoming. This would be interestingly unfair as that bank gave the taxpayer an additional cost of 45 BILLION pounds to the taxpayer. If you are from the UK and reading this then you should ask yourself. Did you make your GBP 666 donation to the save the Royal Bank of Scotland funds? Will you? If not then we should figure out what happened and get this to trial. Considering that the UK has a 1 trillion dollar deficit, then the added debt is costing its citizens GBP 225 million each year in interests. That is almost 3.5 pounds per citizen each year just to keep that part of the debt on par.

So yes, it is interesting to read the article by Jill Treanor. It is also interesting that she was not the only one to mention it; similar articles could be read in the independent, the Telegraph and on the website of the BBC. It seems to me that this is not some political ploy as both MP Vince Cable (Twickenham) and Lord Wallace (Shetland) both seem to be Liberal Democrats, unless Mr Cable prefers Shetland over Twickenham.

The Guardian refers to the report of April on Banking Standards. The report was described to be enthusiastically damning. In another fine piece of writing by Jill Treanor at: “http://www.guardian.co.uk/business/2013/apr/04/bankers-brought-down-hbos” is one sentence that I found ….hmmm, ‘hilarious’ just does not describe that sinking feeling in me. The sentence was “Under pressure from parliament Goodwin’s pension was halved to £340,000“. Are you guys for flipping real? My total pension will never even come close to that amount as a total sum. If there was ever a case of evidence that incompetence pays, then that would be the evidence at hand.

This gives way to a quote in a book by Robert L. Bradley it states: “The businessman who refuses to acknowledge, despite clear evidence, that his facilities are out-dated, his product uncompetitive and his cash flow inadequate, is dishonest just as the one who makes fraudulent claims to the customers is dishonest. Both are trying, at the deepest level, to fake reality.” (Bradley,‘Capitalism at Work: Business, Government, and Energy’,2009,p.66).

I think with this quote he hits the nail on the head for a truckload of cases. He also shows a graphical  bar of difference between incompetence and prosecutable fraud, whilst showing unethical behaviour and Philosophic fraud somewhere on the trajectory. This book is actually quite the little gem where they look at more than just ENRON and a few other devious little greed seekers. It even takes time to discuss the UK and ‘the Coal panic’ of 1865. So keep this book in mind please, it is a diamond in its own right.

So even though we get into the ‘Cloak and Kegger’ mindset that it is not a crime to be incompetent, then there is still the need to assure ourselves of a situation where those people do not run places like banks and corporate enterprises. Financial Services Authority (FSA) was supposed to have handled issues and cases, yet the Parliamentary Commission on Banking Standards seems to show a lack of actions on several levels. That committee on their web page reflected “The regulators also have a lot of explaining to do when it comes to their role earlier in the HBOS debacle. From 2004 up until the latter part of 2007, the FSA was ‘not so much the dog that did not bark as the dog barking up the wrong tree’”

From my view I wonder whether the regulator realised they were indeed the fore mentioned dog, whether they realised what a tree was and whether it ended up eating a bone instead.

The commission report which can be read at: “http://www.publications.parliament.uk/pa/jt201213/jtselect/jtpcbs/144/144.pdf” leaves us with another question that requires serious visible pondering by the press on several levels too. If we consider the issues of HBOS (20 billion) and RBS (45 billion) and the consequent fines that followed over the timeline until now then there are serious questions on those getting an income from the Financial Services Authority (FSA). Here comes the kicker! “and was funded entirely by fees charged to the financial services industry.” So basically we have a group that was not biting the hand that feeds them. How was this ever a good idea?

As per April 1st (no joke) its responsibilities have been split between two new agencies, the Prudential Regulation Authority, the Financial Conduct Authority at the Bank of England.

If we see what has happened here on several levels, it seems to me that self-regulation has failed on a massive scale. Both the Banking and Press industry seems to have scuttled justice, fairness and ethics on many levels and at many places. The question is not how they can restore their integrity; the question should be ‘Why are they presently allowed a place on the negotiation table in the first place?’

This brings me back to the bars as displayed by Robert L. Bradley. In my mind the distance between incompetence and prosecutable Fraud needs to be a lot smaller then I am currently comfortable with and the buffer called Unethical behaviour is a buffer zone that should be nothing more than a mere hairline. From those parts I wonder why massive visible and noisy steps have not yet taken place to remove options of self-regulation in several places at present.

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