March 17, 2013 · 22:16

Savings from a bailed-out nation?

We all know, hear and get frustrated with bail-outs. So why is Cyprus different?

The bail-out will not just happen in one direction. It is not that the Euro zone and the IMF get out the wallet and give this small Island a $10B voucher. The other side here is that people on Cyprus will be taxed up to 9.9% on their savings. If your savings are under 100,000 Euro then you will only lose 6.7%. This is a new situation. It only effects those with money on a Cypriot bank.

So what is this Cyprus? For those not growing up in Europe, you are less likely to know about it. Cyprus is part Greek, part Turkish and all independent. There is more, the Island has only 1 million citizens, so we are looking at a $10,000 per person support fund.

The natural question following is how this place be THAT incompetent? More important, how can a bail-out be handed to this place without DEMANDING the replacement of that entire government? From my point of view, it is either too corrupt or too stupid to continue. Should we not take a more assertive stance before handing out cash you can pretty much kiss goodbye?

In addition, in my view all banks connected to this situation are to directly report to a Euro zone auditor. The rights of those banks, their managers and its board of directors are to be nullified!

It seems that we are way to ‘forgiving’. It is time to show banks that those who play to this effect get their rights, their bonuses and ego removed.

My method of reasoning is simple. President Nicos Anastasiades stated to Reuters as published on 16th of March “we would either chose the catastrophic scenario of disorderly bankruptcy or the scenario of a painful but controlled management of the crisis” he was referring to Cyprus Popular Bank, the recipient of the ELA facility for months, and Bank of Cyprus, the island’s largest bank. It is time to put all cards on the table, it is time that all its citizens, as well as all others to know the unimaginable bungling by those who claim and should know better. Their rights to trading removed at present and it should only be allowed by a controller of the most conservative and cautious kind. It seems to me that most banks and traders seem to have reverted to desperate Las Vegas gamblers who have one last chance and they gamble it all. Banks should not be allowed to do this. For those thinking these words are empty and hollow. Consider the SNS bank, the Dutch bank that was considered ‘too big to fail’. It is now nationalised. It seems to me that handing out money to a group of people ready to gamble it away at a moment’s notice should not be allowed in these positions.

It is however not fair to blame just the banks on this. All this seems to be directly linked to Government bonds as well. One set at $1.5 billion being due on June 30th. So again, we see some kind of borrowing strategy. Politicians who are spending others people’s money and then some more. Living in luxury and using up cash that place NEVER had in the first place. These kinds of bonds are actually usually very much desired because they are considered to be risk free.

Here is my second thought. ANY nation trading in these bonds, while levied above a certain level are no longer to be considered risk-free. I know that this is what those standard & poor ratings are all about, however they had downgraded the status of Cyprus as follows: “We have assigned a recovery rating of ‘4’, indicating an expected recovery rate of 30% to 50% in the event of a default, however unlikely.” (Source: S&P website)

They valued it unlikely? Well, that might be the case, but others have to foot the bill at present.

I suggest that ALL ratings of bailed-out nations are set to CCC (Yes, I can see the panic now!) until the bail-outs are paid back. Italy will not likely enjoy that either! (Mi scusi Presidente!)

Some will come with the reasoning that this is bad because it does not allow for restoration. Is that true? Look at Greece and Italy. Paying up is not on their mind. They seem to be pussyfooting around, all caught between bankruptcy and civil war. Italy might not be on that train yet, but one promise from politico Berlusconi and suddenly he is back in the political race. Yes, that is what Italy needs, more irresponsible spending at present. It is utterly unacceptable that these places play nice weather, with currently no way of paying back. Greece is likely the best example. They current;y seem to have no way to EVER pay it all back. Its people are rioting blaming all but their own governments and banks. For them, consider the amounts your governments spend while they never had the money to begin with. All those VERY willing to borrow to them should be as per now be visibly named too.

These people are all relying on anonymity. Take that away and they lose the option to walk in the streets thinking that life is great. In the end it comes back to accountability. The only fun part for some in the case of Cyprus is that it is filled with Russian mobsters who are likely to lost 9.9%. They really do not like it when their money is messed with. So, should the government and banks suddenly leave THOSE accounts alone, those involved should name and shamed. See what the local population will do then!

However, I am digressing from the issue at hand. Cyprus and the bonds are only part of the topics. It is becoming clear that the discussion should focus towards the S&P ratings.

Quoting Wiki it starts with “Standard & Poor’s (S&P) is an American financial services company. It is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds.”

Wiki is not really an academic standard, however to quickly find a fact it is just as useful as anything else.

The actual issue is the word ‘analyses’ in the entire sentence. In addition I would like to quote a small part that was published by James Rowe on the IMF site on April 20th 2010. I know it is a little old, but there it does state: “IMF says is the newest threat to the financial system: growing sovereign risk.” This has been known for a while, and yes, not only WAS it a risk. I am stating that it STILL is. The S&P rating shows that very part. I am making the additional observation that the analyses might be flawed on a few levels (assumption on my side) as we look at the Cyprus issue. That view is only strengthened as we look at the rating that S&P still seems to hold as per December 12th 2012. “Ratings On Greece Raised To ‘B-/B’ From Selective Default On Completion Of Debt Buyback; Outlook Stable” (Source: S&P).

This is part of the problem! Consider the headline from Feb 20th 2013 “Greek Workers Walk Out in Fresh Austerity Protest” (Source: NY Times). These people seem to not get it, or at least not accept what is needed. They start riots and they start strikes. I am not blaming them. They got handed a raw deal. Unlike some optimistic analysts, who are claiming to see light at the end of the tunnel. There is serious threat that Greece could still collapse if these events are not stemmed. As such, the S&P rating of Greece (and other bailed out nations too) should for a long time stay in the C-range. Reasoning is that bail-outs are limited and there is NO guarantee that it will continue if debt control in Greece is not successfully done. I think that it is irresponsible to take bail-out money in consideration to up the borrow margins. I get it, as a factor, the bail-out is valid, but the fact that it allows Greece a ‘better’ credibility does not seem valid. Even if we consider ‘renewing’ current bonds, Greece (and others) must be used as an example to make it clear that the current path is running out of space fast. Especially as several other governments keep on overspending, with too small a chance to keep their budgets under control. I am against these levels of overspending and enabling by others whilst we all know that there is no end in sight. And it is not just Greece. These visible steps will show clearly to the other nations like Italy and Spain (to name but a few) that the good times are gone, perhaps forever.

It is time for financial institutions and governments to adjust their thinking and approach.

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March 16, 2013 · 21:32

More phones on the hack

So, apparently the phone hacking scandal is far from over. Not only are more claims placed against Murdoch, there is also additional talks of other papers being involved in these matters.

This happens just as a royal charter on press regulations could end up getting vetoed by Nick Clegg.

There are definitely sides the parties do not agree on. Also mentioned in the articles from the Guardian is the response by Lloyd Embley, editor in chief for the Mirror. In an article by Mark Sweney he states: “the protracted talks could turn into a ‘political football’.” (article: http://www.guardian.co.uk/media/2013/mar/13/leveson-discussions-castrate-press-lloyd-embley)

He has a good point, instead of a few pollies thinking they know what they do, it seems decent, to follow Lord Justice Leveson who actually knows what needs doing. Lloyd Embley also states in that article “If we don’t get it right it will end up castrating the press“. To be honest, with all the new phone hacking allegations, making those editors members of boys choir ‘Mare Castratum’ does not seem to be an overly bad idea at present.

I am all for freedom of speech, yet it seems that those members seem to value the news and revenue at the expense of everything and everyone. This has all been said before (by me), but the part that is still lacking visibility is that the investigations will now run into the deep end of 2015. So, the taxpayer will be paying groups of police officers and members of the CPS to get through this mess. So, as the press seems to be lacking in professional issues like ethics. The issue that arrests were made on Thursday 13th March, including FORMER Sunday Mirror editor Tina Weaver. The arrest does not yet mean that Weaver is guilty (others were arrested too). There is now however a phase of damage control which likely falls largely on the desk of Lloyd Embley. With all his efforts in growing the Mirror brand on-line, it seems to me that he needs all this like a hole in the head.

There is however another side to this all. The Tories might find themselves out of the political office sooner rather than later. Reason for this is twofold. First there seems to be a breach between Nick Clegg and David Cameron. They do not seem to be in full agreement here and Labour seems to partner with Liberal Democrats as they seem to be fully in agreement with Lord Justice Leveson on the implementation of regulations.

So next week the PM will have a fun day as he tries to get past attempts to make press regulations to be too toothless. This is in my view the effect if the industry gets to vote on who is in charge of the watchdog that watches them. So Labour definitely has a point there. There is however another side we must not forget. It seems that there is a sizeable group of Tories who are pro-Leveson. This gives Labour a staggering amount of power. So, considering these facts, why would the PM try to continue his approach? Is it because of ideology? Consider that the Guardian reported last November that 30 Tories supported the Leveson report. Whether the all still support that remains to be seen, yet the idea of both sides of the isle supporting such a charter is not that common. Still, it could be a close call. Should labour truly unite, considering the 30 additional votes and perhaps even most from the group of Clegg (aka Liberal Democrats), then the chances of the Leveson report getting implemented would be really strong. The fact that Nick Clegg seems to align with Labour on this only increases the pressure on David Cameron.

This must be one of Rupert Murdoch’s worst nightmares!

Not only is he going to face additional time in the ‘dock’ answering questions regarding the new cases, there is every chance that anything he tries to state with a style of…. what is that word again? Ah yes, diplomacy, will send even more Tories breathing fire as they defect to the side of labour in this case. There is of course the risk that some labour members will actually not support the Leveson report. I did not see any strong voices of this, but it is possible. It seems however that David Cameron would need slightly more than 5% of labour to walk to his side if he is to avoid a not so slightly uncomfortable defeat.

This option seems however less and less likely. Consider other Tories like Lord Fowler (served during Dame Margaret thatcher’s cabinet), who gave his direct support against PM David Cameron in the British Huffington post last January and in favour of the Leveson report. Considering these facts and also considering that Lord Fowler is not the only Tory thinking this, why would the PM continue on the path he currently is on?

In the end should this all come to pass in favour of the Leveson report then Lord Justice Leveson will move as the  with an epic achievement as he becomes the new Chancellor of LJMU (Liverpool John Moores University).

My remaining worry? Whomever takes over from the Lord Justice needs to have the strong backbone the Lord Justice has shown. In addition, those new reported cases, who will sit in judgement when the Lord Justice moves to his new position in May 2013?

I am more than happy to volunteer, as it is on my road to become a law lord. However, I reckon I should finish my Law Masters first and after that at least half a dozen other achievements until the position of Judge of Appeal could be realistically mine. (We should however never ignore our dreams).

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March 13, 2013 · 15:54

Conroy’s freedom of Speech

Conroy’s freedom of Speech

There have always been reasons to check out the front page banner of any newspaper. Some make us curious, some make us angry and some make us realise that the budgie cage needs cleaning. Whatever we think, we do tend to react to a banner.
So, like most people I also reacted. Now, personally I have a slightly less positive view on the Telegraph. So when a politician gets compared to Stalin, Jong-un, Mao Zedong and Castro, it tends to wake me up. My first thought being, now what is the media trying to get away with?

So I first took a little jump into what other media’s are stating and quoting. ABC quoted the following “He also announced plans to establish a new watchdog to ensure that media companies comply with independent journalism standards.”
In addition another newscast from ABC stated “The Federal Government has unveiled the long-awaited details of its proposal which enshrines media standards and tightens ownership regulation through an arms-length advocate to assess media mergers.”

This does not sound too bad, does it?

There is however opposition. ABC also mentioned the following “But independent MPs Andrew Wilkie and Rob Oakeshott have raised concerns about the laws. Mr Wilkie flagged the proposed public interest test for media ownership, saying the area is open to political interference.”

Both sides make clear arguments, yet, what is really at stake?

You see, from my point of view we need to do whatever we can so that we do not have to live and listen to the world according to Fairfax/Murdoch only. When there is a chance to keep the little ones in the field so that multiple views can be heard, the views we hear remain to be from a fair collection of voices.

For me there is another side that is not mentioned at present anywhere (or so at least it seems). Stronger self-regulations and stronger watchdogs were also clearly stated by Lord Justice Leveson. This issue is out far beyond the borders of Australia. The Leveson report is attacked by so many, yet this report shows how out of control the media is. Even though the report is focussed on the UK, there is a clear indication that the issue is playing FAR beyond those borders, and it is even an issue in nations NOT part of the Commonwealth where ‘Freedom of the press’ is nothing less than freedom to harass, freedom to stalk and freedom to display at the expense of everything and everyone for the need of profit and circulation. They however, refer to it as ‘the people have a right to know’.

The media seemed to be upset when the trials started, however I personally think that they seem to be more upset about the fact that they got found out mainly due to a trivial newscast in my humble opinion, than a ground breaking case of journalism.

Professor Ivor Gaber, professor of political journalism at City University London stated the following in his book ‘After Leveson’: “Many people have had much to say about the Leveson report, most of it pretty negative, but in his broad sweep of the relationship between the press and politicians, the good judge gets more right than wrong“.

As stated, the UK is in the middle of reforms halting and talks are breaking down at present. This was reported by the Guardian yesterday March 12th. So what is Senator Stephen Conroy about?
Well, first of all he is a politician and he is trying to get certain reforms in place. I would think that there is an Ego factor in place as well (let us not forget that he is a politician). If he pulls of certain reforms then not only will he look good to many many people. He will also be known as the man who was able to get reforms done, unlike his English counterparts, who are locked in a stalemate at present. So, I would say ‘Well done Stephen!’ at that point.

So is he a media dictator, or is he just in the way of a small group of upper level directors who need to fuel their altars devoted to money? That fair question is not really asked by the press is it?

He is quoted stating that the Australian people want the press to be held accountable. Is that so wrong? One side of the plans is to cut licensing fees in some instances so that the small players get a fair chance in this game. That part is supported by Independent senator Nick Xenophon. Xenophon mentioned in the same ABC story I quoted earlier that this part of the plan has merit. I reckon we can all agree that if the fees are too high, then the voice of Murdoch and Fairfax are all that remain at that point. This is NOT a good idea! Australians might agree that the small new players could bring us fresh artistic views in both news and media in general.

Consider the history of Oporto restaurant which was founded in 1986 by António Cerqueira. By media standards without the changes Conroy proposes, people like him might not exist in the future. We would be limited to Mac Donald and Hungry Jack. By giving smaller players a fair chance we get options, we will get to read and watch other opinions.

The plan of Conroy allows small media groups to reach a much larger audience in open honesty. That is one of his sides. So let us take a look at that. On the Department of broadband, Communication and Digital Economy the following issues were stated:

1. A press standards model which ensures strong self-regulation of the print and on-line news media.

2. The introduction of a Public Interest Test to ensure diversity considerations are taken into account for nationally significant media mergers and acquisitions.

3. Modernising the ABC and SBS charters to reflect their on-line and digital activities.

4. Supporting community television services following digital switchover by providing them a permanent allocation of a portion of Channel A.

5. Making permanent the 50% reduction in the licence fees paid by commercial television broadcasters, conditional on the broadcast of an additional 1460 hours of Australian content by 2015.

The first one is a good one. Giving the press some minimum standards cannot be a bad thing. He is NOT impeaching freedom of the press; he is basically stating that a minimum standard is required. In addition there is the part that the press would be held accountable. So when those ‘implied’ newsbytes, which call for rage and later are stated that they were ‘mis-communications’ might come to an end. I see this in the light of reading a newspaper and getting a much higher quality than a Facebook gossip byte. Is that a bad thing? In addition, do not forge that this is about self-regulation, not about government interference. Labor wants a real watchdog with teeth in place that monitors, not one that is government controlled. They want something better than a Chihuahua lapdog that yaps at time.

The second one is likely the one that keeps the big bosses of media awake for some time to come. This is about more than just the fear of big boys buying out the small ones and drown out smaller voices with the voice of the agenda of the big media owner. Make no mistake, that big media owner has an agenda. If you doubt that take a look at the front page of web search giant Yahoo. It is filled and almost drowning us with the Channel 7 views. Their branding, their ruling kitchen, their sunrise. Compare it to the American Yahoo page and see how small THAT American page is. Channel 7 is not the only one, make no mistake, they all do it in one form or another. When I personally interpret the second rule, I see a voice that states that diversity is always considered. This is to ensure that the smaller interest is never forgotten or ignored. Also, do not forget that no laws are broken here, the steps that Senator Conroy tries to implement is to make sure that the small voices are never lost.

The third one is the only one without a voice from me. I watch SBS, I seldom watch ABC, so I have no idea how out of touch their charter is. C’est la vie!

The fourth one is one I believe in. I never watch them, so why do I care? Because community is about just that, communities! There should be space for all, and to guarantee a space for them is just fair dinkum. Is that not the Australian way?

The fifth should be for us all, making it economically interesting for Australian content to be added to their channels. This is about more than just our voice. It will also grow the view of Australian arts. Australian made shows that might even grow our broadcasting interests on an international level.
If this drives us to get us new original drama that could equal shows like New Zealand’s achievement Top of the Lake, which by the way includes our own David Wenham and Thomas M. wright, as well as a respectable groups of high quality playing kiwi’s, then this is not a bad thing.
The fact that ABC pulled out of the funding here is a nice example (for whatever that reason was) and whether it was valid or not.

Now, I will be the first to admit that these issues should be looked at by more than just the mere blogger (like me). And in this regard I have very good company (as does Senator Conroy). We seem to be voicing the Clarion call of Lord Justice Leveson, who said pretty much the same thing and more (he did it in a document sized over 1900 pages). So that is where item’s one and two come from. Three is a local thing, so I will step over that one. Items 4 and 5 seem to be double edged. Not only do they imply to give strength and fair dinkum to the small fish. In addition it will give additional limit to the bigger boys. If they push diversity from within (whether it is for a discounted license fee or not), it will give a diversified voice and one that is not placed on the pedestal of other US/UK sitcoms. So people a lot wiser then me agree with me (OK, in honesty, I agree with them, but my ego requires a little nourishment at times), and the only ones out for the blood of Conroy seem to be those who dislike accountability.

Yet, is there validity from the other side? In all the articles that paint Senator Conroy in a not to favourable light, I actually found one voice that brought a decent point across. It was by Tom Morton at the Australian. (http://www.theaustralian.com.au/national-affairs/opinion/the-onus-of-the-media-is-to-adopt-decent-standards/story-e6frgd0x-1226297524636)

He has concerns and opposes certain views, but he does address a fear we hold. A journalist SHOULD be held accountable. That is perhaps the biggest fear we have. From what we have seen in the past, most journalists seem to be too shielded with the slogan ‘the people have a right to know’. The fact that most Journo’s seem to get away with murder (figuratively speaking) is why the people would be empowering the acts of Senator Stephen Conroy.

The funny part is that if the press (especially in the UK) had dealt with these issues themselves much stronger, then the current changes might never have had a chance and the British taxpayer could have saved themselves many millions on an extremely chunky sized report.

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March 11, 2013 · 13:23

Start making sense

I have been tossing and turning for most of the night. Something has been bothering me all day, and as it seems most of the night. You see, the Dutch NOS reported on Saturday 9th of March an interesting footnote in their newscast. They suddenly had this short part on the news on how this is possible. (Source: NOS http://nos.nl/artikel/482586-record-op-record-voor-dow-jones.html)

This is interesting, as I asked pretty much the same questions in an earlier blog called “It hurts every time, but we love it”, which I published on Feb 6th, so slightly more than a month earlier. The Dow index is currently at 14,397 (which was a 2007 record). The issue is that we had the crash of 2008; one in six in the US lost their house. So, the economy is not in a good place. There was also the mention in their radio cast (English and Dutch). They seemed to focus on two parts. First was the fact that Economic recovery is gotten through revenue recovery without staffing (so 5 do the work of 10, and they are happy to have a job). Second is that the Dow is based on only 30 companies. Yet, when we look at the number I wonder what game is being played as I look at a 2 year index graph. This graph is Stellar. My issue is twofold. One I am NOT an economist, but a data miner. Second is that the given ‘excuse’ feels wrong. Especially given that the news had this production line backdrop of cars, and none of the 30 seems to be in the car industry. So why not present this with a pharmaceutical backdrop?

So let us take a look at some of these Dow Jones Index companies.

1. Bank of America. A bank, and after 2008, we could wonder in what state it is in. This quote comes from Forbes and was written by Halah Touryalai, one of the Forbes Writers “No bank knows that better than Bank of America which has agreed to pay a jaw-dropping $42 billion, settling credit and mortgage-related legal battles in just the last three years“.

OK, if we take that into consideration, then seems a little weird that their stock graph has the same shape as that of the DOW. (As one of the 30, it would make sense that the graphs are shaped similar, however, such confidence after such a legal fee settlement bill?)

2. JP Morgan Chase. Another Bank! It had two more dips then BofA, yet overall it is in an upwards movement as well. It was also mentioned in the same Forbes article as before on settlement fees, but those fees were a lot lower. The Bank of America had to chew on 66% of the total settlement fees by itself, so for the other 5 big banks, the damage was relatively small in that regard. However, In April and May 2012 they had lost more than six billion dollars on derivative trades that had gone bad. There was a report of 9 billion in total, which also involved Bruno Iksil for part of the mentioned amount, he is also known as ‘the London Whale’. The numbers and the names vary when we look at UK and US papers, but overall they pretty much tell the same story. It is interesting that JP seemed to bounce back within 6 months to stock values higher than before the June 4th 2012 dip. Last on my list is Boeing. It is a giant, but we have all heard of the 787 issues and it’s now named ‘Nightmare liner’. The issue is all about batteries, yet the news from January as reported by Reuters : The new production forecast raised some eyebrows. Russell Solomon at Moody’s Investors Service was forecasting 100 787 deliveries and said Boeing’s forecast of more than 60 was “significantly weaker than we had expected.” Interesting that what analysts expect and what the vibe says Boeing will be delivering is off by almost 40%. Suddenly NOT meeting expectations has almost no impact? 40% less on a firm the size of Boeing should have a very visible effect (imho).

Now the DJI is about 27 other companies and there are only two banks in it. It is also a fact that these banks work with securities and values in the hundreds of billions, so are my concerns just a storm in a teacup?

It is a valid question, and I also ask myself this question. Let us take a look at the two following thoughts.

1. US debt. It is set at 16.6 TRILLION dollars. The total US debt is a lot higher. That one is $59.1 TRILLION.
Can anyone even imagine those numbers? Now consider that someone has that kind of money. To be honest is that really true? Is there a group of nations with that level of wealth? the only nation capable of owning that much is one with an abundance of oil, so basically the United Arab Emirates (UAE) is the only one that wealthy. Either the US is labelled UAE-west, or my thoughts are not that correct in this instance. So perhaps I am wrong (I will be the first one to admit that).
We know that most value trades are now done digital. It is the only way for the market to move such amounts of wealth. However, who checks this?

I have seen my share of digital forms of miscommunication by loads of people in several fields. Often they seem connected to the corporate headquarters of Bloated, Botched, Bungled and Baboon. An always newly formed enterprise, coming to a local public stock market near you. Consider that this is done on the electronic super highway. Now consider that Hackers come at a dozen a dime and greed is eternal, these last two are given facts. Also realise that ANY system can be gotten at. DARPA and the NSA proved that more than once.

The valid question loudly remains: “Who truly checks the validity of trade and the numbers they are traded at?”

2. LIBOR scandal. I wrote about it, the news has talked about it in abundance. Last week in an article by Mark Scott in the NY Times on March 5th the following was stated “The review published by the Financial Services Authority, the country’s regulator, said there had not been a major failure of oversight by local authorities, but it added that officials had become too focused on containing the financial crisis to analyse information connected with the potential rate-rigging”

This is a fair enough statement (it did seem shallow in relation to the handed fines), and them be hefty fines, so why are these two events related? Well, in my mind there are two parts of the LIBOR that were in play. From my point of view there are two variables that might be played with. The first one we know. It is the interest rate; the second one is the bigger issue. You see, those percentages are linked to a total sum of $350 trillion in UK registered derivatives. That is 20 times the US national debt. If people play with one, there is every reason to suspect that they might have played with the other. So again, who controls those totals that are being traded in? If derivatives include hedge funds, swaps and forward rate agreements then we should be worried. Consider as well that the US Bank for International Settlements holds almost twice the value the UK seems to be registering.

So, we are now confronted with just in excess of 1000 TRILLION dollars. How can this even be monitored? Now let us add one more part. The US LIBOR rate is set by 18 banks. The two banks in the DJI are members. Are we all on the same page now? The third bank (Citi) is to be given a fine in regards to percentage ‘tweaking’. According to Reuters, later this year, a new set of settlements will be ‘delivered’. In their publication of March 8th by Kirstin Ridley and Philipp Halstrick it states that: “Deutsche, Citi and JPM are the banks named in regulatory circles as those candidates near the next settlements,” said the second source. So now we have both a DJI member and libor member in this illustrious ‘donation’ scheme. What else is at play?

What if the total value is not correct? What if they did not just play with the percentages, but the total package of the trade able amount? Let’s just take a fictive 5%. Mainly because I feel not so comfortable with the value they say they have and in part because I cannot even comprehend that much, as we get above the $200 trillion range. So, if 5% is taken off the total amount of over $1000 Trillion, would mean that we might all be devaluated by a total of 50 trillion dollars. That comes down to $8400 for every citizen on the planet. Did we sign up for that invoice?

It might be just be me (and I can happily live with that notion), but can bankers and financial corporations be allowed to continue on this track? We have seen clear evidence that those places cannot be trusted with even a small speckle of such amounts. Even though they NEVER broke any laws initially, LIBOR shows that some are very willing to do that. With the US on the edge of bankruptcy (or on the wrong side of a fiscal abyss), with the financial industry in such disarray, what can be done?

So when this all falls over (not if it falls over), what will we be left with?

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March 10, 2013 · 18:04

Humanitarian Law v National security

HRA_MI5
The news has been on and off for a long time involving the Muslim Cleric Abu Qatada. Again yesterday as ‘another’ attempt to evict him has started. There is anger in both politics and the population on a person who is receiving a large amount of support, costs a bundle in legal fees and he is staying in a house paid by the UK government which is priced at half a million pounds. In this time and age of overbearing amounts of unemployed and poverty, those events are having a very negative effect on the population.
Yet, this cannot be about feelings and emotions. We cannot ignore them, but the balance requires us to take a look in the other extreme, namely the logical view.
I will ignore most rumours and classified information involving Qatada from before the arrest of October 2002, when he was taken to Belmarsh Prison. The reason that before that date most of it is all based on he said, she said and Lucy did (Lowdown Understanding of Circulator Younglings) as the Intelligence community is sometimes labelled by those who seem there is no need for the Intelligence community.
Yet, in this specific light is their view invalid?
Britain initially detained Abu Qatada in 2002 under anti-terror laws imposed in the wake of 9/11 but he was released under house arrest, sparking a ten-year battle to send him to Jordan. This would be the Anti-terrorism, Crime and Security Act 2001. On 16 December 2004 the Law Lords ruled that Section 23 was an issue, but under the terms of the Human Rights Act 1998 it remained in force. It has since been replaced by the Prevention of Terrorism Act 2005.
The BBC reported in their time line that in October 2002 Abu Qatada was Detained without charge. If we look at the ACSA 2001 act, then we should take a look at both sections 23 and 24.
S23 talks about detaining international terrorists, despite that his removal or departure from the UK is prevented. It is nice that S23(1)(b) mentions (or) a practical consideration. So the practical consideration allows for Abu Qatada to be detained.
S23(1) does refer to part (2), which requires provision paragraph 16 of schedule 2 of the Immigration Act of 1971 (c.77) as well as (and) paragraph 2 of Schedule 3 to that same act.
So we need to get to the immigration act. It is already interesting that they did not refer to the Immigration and Asylum Act 1999, which was released two years before that.
There it basically states that a person who may be required to submit to examination under paragraph 2 may be detained under the authority of an immigration officer pending a decision to give or refuse him leave to enter.
That paragraph reads literally:
(2) Where the Secretary of State may give directions for a person’s removal in accordance with sub-paragraph (1) above, he may instead give directions for his removal in accordance with arrangements to be made by the Secretary of State to any country or territory to which he could be removed under sub-paragraph (1).

Which then refers to proceedings, ejections and the Immigration Appeals act 1969.
I reckon the Clash had it down to a legal fine art when they wrote the lyrics ‘Should I stay or should I go!’
The more I read, the more I feel that the Anti-terrorism, Crime and Security Act 2001 was created a little too rash, but I am steering off course.
We get back to three parts.
1. HOW did he get here?
2. WHY was Abu Qatada arrested?
3. Why is this all taking so long?
Going back to 2002, he was held without being charged. This statement seems truthful as an immigration officer can do this; however, the things that follow are an issue. Why did this take until 2005? The Telegraph reported that he was freed in March 2005 on conditional bail. So can anyone explain to me how that takes 3 years? The Clash was spot on! Should he stay, or should he go! Was he a real threat?
1. He got here on a forged passport in 1993 and was given Asylum 9 months later.
The CPS (the UK version of the DPP) had the following information on their website:
Obtaining Leave by Deception – section 24A (1) Immigration Act 1971.
This offence came into force on 14 February 2000.
A person who is not a British Citizen commits this offence if by means which include deception by him:
a) he obtains or seeks to obtain leave to enter or remain in the United Kingdom; or
b) he secures or seeks to secure the avoidance, postponement or revocation of enforcement action against him.
In proving deception, direct evidence from the immigration official who was deceived should ordinarily be obtained. Further information regarding this element can be found in the legal guidance dealing with the dishonesty offences under Section 15 of the Theft Act 1968. See guidance on Theft.
In drafting a charge or indictment under this section, it will be necessary to elect whether the allegation is made under section 24A (1) (a) or (b) of the 1971 Act.
There may also be an offence under section 26 (1)(c) of the 1971 Act of making a false statement, return or representation to an immigration official in the commission of any offence under Section 24 of the 1971 Act. The Section 26 offences are explained below. The statutory defence under section 31 Immigration and Asylum Act 1999 applies to this offence.
This offence is an either-way offence and the maximum penalty on indictment is either a fine not exceeding the statutory maximum or imprisonment for a term not exceeding 2 years, or both.
The leading authority for sentencing is R v Nasir Ali [2002] 2 Cr. App. R. This case indicates that even where a guilty plea is entered, a sentence of 9 to 12 months imprisonment should be imposed. In terms of venue, these offences should ordinarily be dealt with in the Crown Court unless there is exceptional mitigation.
Important to know that His forged immigration feat in 1993, does not imply expulsion from the UK (no mention of that other than that he might face up to 2 years of Jail time. It seems he has done a lot more than that. Is this all about posturing?
I think it is a valid question. Yes, the man had ties, Yes, he had outspoken thoughts (thoughts I do NOT condone), but beyond that, has he actually committed a crime that warrants 10 years in Jail?
I am not speaking out for him, or condoning terrorism in ANY way. I am asking, what crimes did he commit? This is linked to part two of the three questions, and part three remains the same. Why is this taking so long? I cannot understand this part. Instead of closing it all down, Qatada is receiving thousands of pounds in Financial aid on many levels. It seems to me that on a political level many posturing acts are made and too many citizens are paying that bill.
In regards to the BBC quote by the PM Mr Cameron: “I am completely fed up with the fact this man is still at large in our country, he has no right to be there, we believe he’s a threat to our country“. As well as the claims as voiced on Sky News UK on March 9th “Theresa May has applied for permission to appeal against a decision to block the deportation of Jordanian terror suspect Abu Qatada”
My questions become, what on earth are they doing?
There are two reasons.
First is that MOST of these messes come with the trade of forged and illegal VISA papers! WHY is the immigration act not amended to include voiding residency if residency was obtained in any illegal way? There could be an exception if it can be proven that the person is seeking asylum from persecution. In addition, there would still a period of time between Residency and Citizenship to make additional checks. All this time wasted, all that money wasted!
The second reason is that the PM states that he has no right to be here. How so? Let us not forget that his entry was approved 6 years before the Americans had their 9/11. It seems that this case taken immensely out of proportions.
Now the other side! Was it taken out of proportions?
There is a government’s duty to react in defence and protection of its citizens. Let us be fair. MI-5 is not there to have fun and just sit around. They have goal and purpose. There seems to be a massive amount of ambiguity going on as well, especially in this case. Several European Judges claimed that Qatada is more than just a money man for Al-Qaeda. Either there is proof, and he is extradited or there is not. There is no legal twilight (as the Independent stated) in my mind. If there is evidence, then MI-5 must give it and stop playing around with security considerations (if they are at all involved at present), If there is no evidence, then cut him loose.

There are three branches wasting massive amount of tax payers costs. All founded in Ego (or so it seems). Why?
If we move towards IHL we can see that the first rule in this is ‘Persons outside of combat and those not taking part in hostilities shall be protected and treated humanely‘.
That rule seems to be simple enough.
So if we can agree on the premise that Spies and terrorists are only protected by the laws of war if the power which holds them is in a state of armed conflict or war and until they are found to be an unlawful combatant, then the solution seems so simple (I am infamously known to oversimplify issues).
Al-Qaeda is a terrorist organisation. It acted against the US and UK, so there is no issue. If there is evidence that Qatada was part of Al-Qaeda, then he is guilty and can be processed. As he was arrested again in more than one issue and involving transgressing the strict bail rules, then the question becomes. Is Qatada presently in violation of the Terrorism Act 2006? If so, process him, if not, let him go. Let us not forget that he can only be held up to 15 years according to Section 13 of that act.
This should follow a huge paragraph on the rules and regulations of extradition, but I will spare myself THAT agony for now. (Reading 4 acts on one day is quite enough).
Personally, from the news and information I wonder if we are not going too far on a binge to ‘assist’ the US in their witch-hunt for their terrorists. I am not arguing AGAINST their hunt for Al-Qaeda, but a lot of this evidence is way too thin, as mentioned by the Appeals Judge Sir John Mitting.
It’s not that there is a magical road to wander. It is process, rules of evidence and such (pesky law rules, according to some).
I wonder how Sir Jonathan Evans sees this all? If there is an abundance of political posturing, then at some point (sooner rather than later), the house of Lords might ask him, and likely will definitely ask the PM and the Home Secretary a few questions on this specific matter as this case spirals further out of control (by kind cooperation of the UK Media).
Getting back to the title
Common Law has grown on Humanitarian grounds and the rights of the individual.
The Common law system is based on previous court decisions. They are considered “law” with the same force of law as statutes. This has been going on for a few centuries. Common law courts have had the authority to make law where no legislative statute exists, and statutes mean what courts interpret them to mean. In this environment the UK, as well as Australia and especially Canada grew a justice system that respected the rights of the individuals and especially as all are innocent until proven guilty. The UK has not been without its issues like the IRA and the Ulster Brigade. It is only because of those events during the 70’s and 80’s that MI-5 grew to the strength that it was able to keep the UK relatively safe against attacks by Al-Qaeda. What most did not realise that 9/11 showed that the issue with terrorists is not just finding them, but prosecuting them, because of a ‘failed’ law system became a lot harder. I use the word ‘failed’ as Common Law had never dealt with situations like that, and neither had the US. The question becomes on how to deal with terrorists in Law. Common Law is to treat all alike. This is where the shoe no longer fits. A few require a different prosecution. This is not common Law; however these few have the desire to end the lives of many. Can the Law be allowed to continue to endanger the lives of many hundreds of its citizens as one is protected against draconian law needs?
Whether Abu Qatada is guilty or innocent, the issues that showed up during his extradition do leave us with a clear path of evidence. Several acts need to be revamped.
The valid question why this was never correctly done will remain on many minds for a long time to come.

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March 5, 2013 · 18:50

Tomb Raider, A game the wrong way round.

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This is for those who play/played games (on a console or PC). I have been involved in the gaming industry for a long time. I have tested them, reviewed them and been in contact with original game creators since 1989. No matter who we applaud for whatever game started what, there is no denying a basic fact. When Sony released the first PlayStation the world of gaming changed forever.

This console came in the beginning with a minimum amount of games; however gaming changed forever one year after the PlayStation was released when a game named Tomb Raider was released. This game was in no uncertain terms the pinnacle of gaming in many ways. It was puzzling, Action, exploring and extremely exciting. It had 4 area’s comprising of 18 levels. It was a massive game filled with so many things that replaying was essential. The game that followed was even bigger and more challenging. I reckon it took no less than 3 weeks to get through either game. I was mesmerised. It was there for a shock that I got through this new game for almost 90% in just two days.

The new Tomb Raider is served like an expensive meal. Nice plate, exquisite display of eatable items, but a nice plate does not necessarily leave you filled and in this case it leaves you hungry soon after dinner. The game is rocky in several places. It is repetitive; at times it has the same shock effect again and again and at times too cinematographic where you must push a button at the exact time.

So, what are the good parts?

Yes, they had so much to work with. Enough so, that I am very concerned on how this was messed up to that extent. The premise that it is on ONE island was pretty brilliant, the idea of a Tomb Raider zero is pretty decent and one thing MUST be stated at the very beginning is that the graphics are UNREAL! That is the one part that is beyond exceptional. The graphics show utter perfection. Especially when you get to a level called coastal base, you have no idea what you are in for. The graphical part of the game is without a doubt utterly perfect. To give you a little more, this is from the same house that brought Deus Ex. A game that brought several times the satisfaction this game brings. Square Enix is a house that has a high quality established name, so what went wrong? WHY is this game so mediocre in my mind?

Let us take a look at the first level. It is decent and a good introduction to this game. It gives the person a way to control and move through the introduction. In the end of this short run we will have seen how easy the game is controlled and that is what any good introduction does. From there we stop at our first camp. The camps are important and it is a good way to progress and safe a game. All that is fine. Next we get to get the bow and do a little hunting. Soon thereafter you will get a first feel on how good the game might be. You as a gamer will quickly become hungry for more. After a day, when you see your progress you realise that overall this game could have been a lot more, and it is without a doubt way too small. The indication that ‘downloaded’ tombs are coming might not even be a consolation, especially if those tombs cost extra (unknown at this time whether it will cost). I do not know whether the failing is due to timing, due to marketing or just a lack of creativity. The art and graphics are so amazing that the third option is not likely the case.

Levels are overall not that bad and the hidden tombs are nice. The change that the entire game plays on One Island gives the game a good feel, and soon the story will narrate into a supernatural field that is well known and a source of fame for the Tomb Raider series. So, the elements of a great Tomb Raider game are definitely there. However, some levels could have been a lot larger, making the game a lot more and especially longer challenging. I reckon that this is one of the two great flaws in this game. The game does have many decent sides, again, it tends to get repetitive when Lara is dumped in the deep end, suddenly surrounded by overwhelming forces and then the fight starts again. I can understand that approach to happen once or twice, but it happens too often, I would state that this is a big No in my book. This repetition becomes tedious after a while. This is odd way to go, because the approach with stealth kills with a bow is actually a very nice twist for the player. In addition we soon have an idea who is two-timing us, so the average gamer will not get too much of a surprise.

What was good is in some levels there is a running need to jump, climb and skip in a cinematographic approach. This is not bad, but it again happens too often and then it is all about timing the button correctly, or to shoot the right obstacles. 2-3 might be nice, but it happens slightly too often with too many cut scenes.

What could have been done better? Larger playing levels are a definite! 2 of them, like the Coastal area and the climb to the monastery are sizeable area’s to see. However, getting through the levels is at times slightly too fast. If we look at places like the Research Station, we see a place that was way too small. Even additional puzzles in all areas would have been a good thing. Additional levels and depths as well as puzzles to get through the hidden tombs would have given this game additional weight; those additions would have dramatically driven the score of the game. In one weekend I got up to the final temple, and most areas were 100% completed.

I am a decent gamer, but not a great one. I am certain several gamers could have done the same game 1-2 hours quicker on the highest setting, which again is shown in my low score. The hidden tombs are a fun idea; however, for the most each one has one small puzzle and not a challenging one at that. Only the fishery tomb is slightly challenging at first. But all levels do show utter perfection in its graphical and artistic environment. That makes it all so upsetting.

I would rate this game a 7.5 out of 10. With a little more effort it could have been an easy 9.4 out of 10. Which begs the question, why the failing effort? Tomb Raider, of all games should be better than this in my mind. The second question is how the critics came to a score so high, way higher then it currently deserves.

Important that this review is based on the single player ONLY! This game has an additional multi-player option which was not tested.

 

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March 3, 2013 · 16:51

March Hare of Government

Most of us have seen the news and heard the messages of the sequester cuts for the US of 85 billion dollars. How so many are now up in arms.
Let us be honest! This is all a load of rubbish (imho)! The deficit is 16+ trillion dollars. At 0.5% interest annual interest should be well over 80 billion a year, so they are still skating backwards if only 0.5% interest was due. In reality, as we doubt whether the US will EVER correctly deal with their debts we could consider the fact that it should be a lot higher than that. Also, important that even at 0% interest, it will take 200 years to get rid of a deficit this high. Are you awake yet?
I already mentioned it in 2011 that America was joining the 3G nations (nations that will need 3 generations to get rid of their debt). I was not alone in these thoughts; people like Glenn Beck, Bill O’Reilly and others were on THAT bandwagon as early as 2010. No one listened, all claimed it was not that bad, and it is now shown more clearly on a daily basis that it is getting worse. Yes, a March Hare is in charge of US Government. Oh Boy! The US is not alone in this situation, that same Looney Tunes character, created by Lewis Carroll seems to be in charge all over the commonwealth too. You know, those smaller world leading countries like UK, Australia and to some extent even in Canada. Lewis would be so delighted that he could have added in the cover of his book “These characters are based on leading individuals of the British Empire and those bloody colonials” (sorry US, I could not resist this).
First of all, for the next part, you must realise something first: “I AM NOT A RICH MAN!”
All capitals, I insist! The issue is that I am on the Republican side in this. It is also why I am so angry in regards of the (imho) the statement, which i consider to be BS, voiced by President Obama all over the news. He states “This was not necessary”, I say yes it is. He has overspent to such a degree that these cuts are essential for that nation to NOT go bankrupt. It is also linked to my life philosophy. I have always believed in being a Return on Investment. I get a job and that boss makes a profit by having me. I have worked on dozens of projects every quarter for over 20 years, and my bosses made more than just a small profit. This is how it should go. A company makes profit and that company continues and its staff members have a job. I believe in this simple premise with all my being.
You might think it is a simple and naive approach, but consider to alternative from the financial industry. They play markets on assumptions and reap benefits on image and commissions on a premise, not a given, and not on an actual creation of wealth. That was shown by Goldman Sachs in the 2008 issue where they banked on bad credit and foreclosures to make quick cash. All legal, but that should never have been allowed. This part now reflects back to the US government as these loop holes are still NOT stopped, and they just keep on grabbing from the wealthy and not from the immoral. These two groups are not the same.
This is however, not just about the US. the UK, Australia, the Netherlands, Italy and even France are going in EXACTLY the same direction. In the Netherlands on March 1st their Easter Bunny surprise is about to show the nasty side as it might go into a burnout as they are trying to find 4.3 Billion Euro in cut backs. Not unlike the US, they have been overspending for almost a decade and instead of taking heed then, they left it until they were no longer in office. You just need to check the Dutch newscasts between 2009 and 2011 to see dozens of articles “GroenLinks: bezuinigen is helemaal niet nodig” (the Greens state that cutbacks are not needed). These were often specific issues; however, the overall clear issue is that cutbacks were left too late. Any doubts? Consider that 250 million Euro annual cutbacks in 2008 onwards could have prevented a 4 billion cutback almost essential now. I use the word ‘almost’ as the method of cut backs is nearly always a debatable thing. All parties are passionate on protecting THEIR groups, but some must give in to the needs of cut backs. The CDA (Christian Democrats) are actually voicing a lot like the Republicans. It cannot remain about cutbacks; it must be about proper spending of what is available. So here we have our first direct link.
Two parties who I personally never really agreed with are voicing a solution that is simple and clear. I am NOT against taxing the rich to a certain degree (I am not rich, so fair enough). But NO nation can continue when the rich are taxed to such a degree they move away to other liveable lands. And in all fairness, that group is small. So small that taking them another 1% will NOT EVER get the government the money mountain they need. Should you doubt this, and that is fair enough, one must always question things, consider 1% to make 85 billion needs an Income group of billionaires making a sum of 8.5 trillion dollars. The US, UK and Australia combined do not have that amount of billionaires. This is the empty cloud that Democrats are offering. Which is why I oppose this mindless action. Spending needs to be put under control for a long time, long before 2011. I will state that this is not all President Obama’s fault. He did inherit a bad situation and that must be stated if we look at this honestly. I believe he truly thought that his approach to the bad economy was the best solution. I cannot fault or blame ideology. Yet, 4 years in office showed so clearly that this was NEVER a solution. So why he is continuing that method in his second term is in all honesty beyond me.

So, now let us add the next shackle in this chain. The UK and Australia are already feeling the weights of healthcare. In 2011 the UK had a population of 60 million people. For the period 2010-2011 the NHS had spent 51 billion pounds (as mentioned by the UK department of health). That almost equates to 1000 pounds per person (roughly $1500). A large slice of the UK population never gets sick or treated, yet the group that needs healthcare therefore required more than the 1000 pounds. This figure will shift as the population is growing old and grey. It is clear that the NHS will need more and more money, which is a clear reality many nations face. That links back to US healthcare. Whether it is labelled as Obamacare, as Healthcare or whatever coat of labelling it needs. Forbes reported in 2012 that US healthcare was set around 3 Trillion dollars. Now take a population of 325 Million in the US. Then we see that 1500 dollars do not get us anywhere near the needs of the UK. We can make two conclusions. Either the average American is very unhealthy, or that Medicare in the US is vastly overpriced.
OK, I admit that this equation is very simple and there are more factors at work. However, I hope that it is clear to most that something is wrong. I have stated before that the US seems to be a greed driven society (even though it is mostly visible in Banking and Financial Institutions), Shakespeare would state that there seems to be a stench coming from the state of budgeting (Hamlet banking association, 2008). Just to be certain you do not get the wrong impression, oddly enough Nurses seem to get the smallest part from that barrel, so they are constantly being underpaid (a global truth), so where does all the money go?

The next is generic and not just connected to healthcare. There seems to be too many managers in a company. If America is a ship, then the President is its captain. That is simple and clear. It is however an issue that this administration could be regarded as a badly stocked Titanic with 132 Pursers, 373 stewards, 83 cooks, 227 barkeepers, 93 janitors and the odd Marshall. The issue is that the paying crew is roughly 2000. This could never continue. When the servicing crew is at almost 50% of the paying customers, then either this population starts paying a hell of a lot more, or the ship sinks. I hope that this comparison is a lot clearer. It is actually close to the comparison as the RMS Titanic was populated. Yet, that ship was mostly designed for the indulgent and the wealthy. I hope that some will remember what happened. 1502 people died there. The numbers almost equates that one crew member saves one passenger, the rest is out of luck (I am NOT stating that this is what happened on the RMS Titanic). That is however how the US economy is seen by many. The numbers are a little harder. They are unclear on how many people lost their homes and never got another home. The numbers add up into the millions, and it seems to be around that one in six lost a home forever. So one government worker saves one citizen, the rest is out of luck. This seems to be the Nanny state as some call it. Funds for all! Yet, when no money is coming in, that nation gets shut down real fast. All nations depend on actual money making contribution to survive.

This is how 2013 is starting for the US. The bad issues coming is NOT because of some sequester. It is NOT because someone reports moderate growth. There is a collection of machines left, right and liberal trying to get what they can secure. We can look at Heidi Moore of the Guardian or Maxwell Strachan of the Huffington post. There is long term of financial pain coming and no one is safe. Yet, in all this, it is interesting how some ‘experts’ like Agentschap NL and NABE seem to predict a +2% growth in 2014. What is this? The land of the Umpa Lumpa’s?

I would love those numbers to be realistic. It seems however that those ‘experts’ are more and more moving to the mindset of market research where they seem to present what a government would like to reflect then to the area of research where we reflect the actual facts. Neither is a lie, but one is very very incorrect. All governments want to see nice indications, so they can forward the invoice. That time is gone; we have overspent for too long. Unless spending is reduced greatly, and fat is cut all over we will not see any good growth. If you doubt that, then look at the issues now going on all over Europe as horse meat is added to ‘expensive’ beef. When the daily issues of life are frauded on, then they have met rock bottom. There is no way you can ignore that (as far as I know it takes twice the time to grow a horse to adulthood, compared to a cow, which makes me wonder what on earth is ACTUALLY going on).
So let us get back on that horse steak and drive back to the so called ‘financial growth’. The seen level of misrepresentation is exactly how we move towards the Abyss. Some of those ‘experts’ might point to such good profitable places like China and India where things are currently so prosperous and how we all could be this successful. They are deceiving YOU and delusional towards themselves. You see, YES, Those two places are going forward, and 10,000 new millionaires seem to pop up. Yet, this is due to them voicing the need of outsourcing. WE lost those jobs (perhaps forever). They were cheap, and like on any ‘slave’ farm, there are guards and overseers getting a fair wage for every 10000 workers who are getting mere pennies (in comparison). Now consider that one third of the global population lives in those two nations. So that number of 10000 millionaires seems ‘fair’. Now add to this, a consumer market that could be slowly collapsing. We now have the means for that iPad, Ultrabook or iPhone, but is that still possible in January 2014? Soon this curve will level and then I expect it to decrease. Whether the decrease is short term, or long term I cannot foresee at present (there is no way to tell). But from my point of view it seems that America with their 200 years of debt would be living on slim margins for a very long time to come. If the Commonwealth and the EEC do NOT severely change their budgeting habits we will end in a similar predicament. Make no mistake; America will happily push US over the edge to survive a little longer. Then what?

We need to get a lot better and clever on how we do business and how we govern. My worry is that too many politicians on a global scale are not willing to consider that, especially if they and their constituents have to cut back.

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February 28, 2013 · 17:52

The military Pound

We do not need to look far to see that cut backs are more than just the talk of the town. They have been the talk of nations for a long time, and we have seen more than one system discussed when it comes to the need for overspending.

So, when many read about the fact that the military overspend again we might not have looked to be too overly surprised. It is however the proverbial straw that is breaking the camel’s back. This is what was said on Sky News on Feb 28th “Britain’s Ministry of Defence has been slammed after a report showed between 2009 and 2011 it bought STG 1.5 billion ($A2.24 billion) worth of equipment more than it used.“

The article was short, to the point and ended with “The ministry is to introduce controls that it hopes will reduce spending on inventory by STG 500 million a year by 2015.“

So, the British consumer will be confronted with taxation on overspending by almost 2 billion until that time? How is that fair. This is not the end of it. There is a lot more. This is the clear part where we are confronted with overspendings; however, there are a few more issues at play.

The New York Times published a story in July 2006 named “Pentagon Struggles With Cost Overruns and Delays“. In this example they went over the costs of the F-22a Raptor. It was a track from 1991 until 2010 that showed a massive amount of overspending. The response as stated in the New York Times was “We must transform the way the department works and what it works on, he said. It could be said that it’s a matter of life and death — ultimately, every American’s.“

So was that an answer? It seems not. Because that same story repeats itself when we look at headlines involving the F-35. “$24 billion British budget blow-out in black hole F-35 project“.

It seems that the boys in uniform seem oblivious to words like ‘common sense’, ‘budgets’, ‘overspending’ and you know, words of that general direction. Now I am all for a good defence, yet the parties involved seem to be either completely academically ineffective (incompetent seems too hard a word), or those paying are really lacking a certain level of backbone. Especially when budgets are overstretched the way they are. Am I having a go at the Australian and UK admin soldiers? I am not sure. Who made these decisions? Who allowed for these levels of overspending? These are serious questions that need answers and it needs more then investigation, it requires ACTUAL actions being taken. I am not talking about some political inquest wasting even more time and money. No! Defence needs to take a look at their laundry and fix this. It seems clear and shown that this needs fixing on several levels.

In the meantime solutions must be found, especially when it is clear that almost all parties in the commonwealth have to tighten the belt on budgets all over the place. It seems very unfair that even though the military are to most the visible part to defend a nation, the people placing their lives in harm’s way on a daily basis are having their budgets cut severely.

You know, I have a nice idea, right out of the extreme right field. Lockheed Martin donates 1% of paid costs by the DOD to the Metropolitan police as a show of good faith. Not all will be happy with this idea, but several will be less unhappy and the way the costs are cut especially to the police departments. It seems only fair. Who knows, Sir Bernard Hogan-Howe might arrive in the office on a Monday morning holding on to a cheque and wearing a large smile (be not afraid if that happens). The same could be done for the RAAF. I reckon Commissioner Scipione might be happy to know that in the end, overspending almost 30% per F-35 unit (an unacceptable amount of overspending per unit) the police force will get a small shiny future. The other option is for the RAF to order 14 less F-35’s and the RAAF orders 2-3 less and these police departments get those funds directly.

There is however a deeper part to those rumours. Is the F-35 too overpriced and are we moving to a previous model (the F-22)? Even though several sources implied certain noises, there is no real knowledge at present (or better stated, known to me) that this is actually happening. It would be interesting as the NY Times reported that the F-22 had its last delivery in 2010. If so, should we pay full price for a model taken out of production? Would you pay sticker price for a 2010 Toyota? This seems more than a little unfair. Not to mention that we seem to reward/ignore a blatant budget overrun for two planes by the same company. A ‘ploy’ they seem to have handled since 1991. That means they did not seem to have cleaned up their act for two decades.

So we have two issues.

1. Commonwealth armies seem to be overspending by a lot and on needless things.
2. Commonwealth armies are confronted and left with much higher bills by their suppliers.

I am not claiming that the military are doing this on an intentional basis to waste money, but it stands to reason that we should ask questions when the size of the British forces is set around 225,000 and there seems to be an annual overdraft of 800 million dollars. The Australian Defence forces are not without fault either. This was mentioned in an article by the SMH, however I personally thought that this article asked more questions on the numbers they reported, then on the actual issue.

There is another side to this, and this was voiced by President Obama on Feb 19th as mentioned in the Guardian. “Obama warns Congress over spending cuts: ‘People will lose their jobs‘”. This is not an unfair statement. Yet the issue that is not mentioned is that overall, the profit margin for those companies is often a lot larger than most commercial companies seem to be left with, and THAT part seems to have never been curbed. That was illustrated in an article in Aviation week by Joe Anselmo on May 18, 2012. There it was quoted that “A Wall Street research firm says defense contractors should be able to maintain their profit margins even as Pentagon spending declines“. That seems to prove the thoughts that others have as well as myself. So, these are not unique thoughts. These are thoughts that have been in play for a long time, so when we are looking at recessions and budget issues, it seems to me that there is at least one player in town who gets to play with a stacked deck.

I hope the message is getting through. There is a massive amount of needless overspending and there currently seems to be no planned solution to properly curb this enthusiastic method of an open wallet policy.

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February 27, 2013 · 13:49

The ugly unspoken truth

It is nice to get your thoughts confirmed. So, my ego was taking a nice leap forward when I saw how ministers all over Europe agree with my views on blogs I had written in the last few months. Foreign ministers Margallo from Spain and Westerwelle from Germany as well as French Minister Moscovici from France voiced pretty much literally the issues I had on several finance issues plaguing debt driven Europe. The Italian election is not as much a solution as it has now become an issue of less trust and security then before the elections.

So, it is nice that they agree however, the issue I have is that the Italian population seems to ignore that THEIR predicament comes from massive irresponsible spending. The other part is that Germany, when needed did tighten the belt and therefore they are now in such a strong state. Other nations are still fighting with issue they have (like the Netherlands). This is not because they are not doing anything, but because, from my humble opinion, they started too late, and as such they are now in this ‘mess’. They still have more issues to come. As they reflected that 2014 would bring a 1.1% increase, my thoughts are nowhere near that optimistic. I cannot vow on the issue that they are wrong, yet, over positive thinking is a hampering Anvil for them. I would think that if they could pull of a 0.3% positive growth in 2014, then that might be nothing less than a decent miracle.

Whether they get this through ‘clever’ bookkeeping is to be seen. Even in the most optimistic events. This means that the Trade ministry would need to get their International options like in Qatar and Bahrain. This would definitely help towards the 0.3% growth but not the 1.1%. In addition, the issues currently plaguing the gas winnings in the state of Groningen could hamper income for the Dutch government. They reported over 11 billion euro revenue from gas. However, as areas in Groningen were disturbed by Quake’s that seem to grow in intensity due to the method of extracting, could have two effects. First it is not inconceivable that revenue from Gas might fall below 10 billion, as well as the fact that damages from these quakes mean that payments well into the millions would be added as costs. In addition, there have been newscasts that current events are NOT events the current industry buildings are protected against, so not limiting gas extractions could have far fetching consequences. Not just to the revenue, but also to an area with culture and architecture that is quite unique to that nation.

The final straw is the involvement of the RABO bank in the LIBOR scandal. They have been given a penitent company donation of 330 million Euro. Even though they are not state owned like the SNS, there will be consequences. The first one would be whether Moody will adjust the bank even further. It was downgraded in June 2012 from AAA to AA2. Will the fine as well as the implication of lessened revenue and profit (as resulted from the LIBOR effect) mean this bank is downgraded even further? That part I do not, and do not claim to know, but it stands to reason that additional drops in government donations (read paid taxes) will dwindle a little. All these facts mean that the target of 3% budget deficit is not likely to be achievable. This links of course to the issues in Italy. As they miss their targets we are now with 2 players who become a question mark and Italy being number 3 on the ranking list of Europe, THAT impact will be a prominent one.

This European cart which is in definition pulled by the current two champion stags (France and Germany) will only slow them down too, meaning that a strong European economy (or at least less debt driven) is not likely to become a reality before 2016. If I had any faith in my predictions (remember, I am not an economist), then I would speculate that 2014 will be Europe’s hardest year. Not because of the economy as it gets through 2013, but because the drag from 2011 through to 2014 will have exhausted both people and companies to the brink of collapse (of financial exhaustion). For those thinking that I am so far of the mark, consider the greying population and the issues they are already in a group that cannot make ends meet in January 2013. The issue here is that this is not limited to places like the Netherlands and Spain. A fear of clear shortage is also hitting France, Italy and Germany. It will be hit on both sides of the equation. On one side, there is a clear danger that less money can be paid towards pensioners and stronger on the other side is the ever increasing cost of living. Whether it is because of food, Electricity and/or gas/fuel prices. Retiring before 2018 does not seem to be a healthy option, and NO guarantees are forthcoming any day soon.

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February 22, 2013 · 15:01

They’re consoles, but not as we know them!

Have you been looking forward to the Hype start of the PlayStation 4 yesterday? I was not. I did not waste time waiting for some stream to start with all the other people who were waiting to be the first to know. Millions of viewers and all were watching the same stream at the same time. I was not. Don’t get me wrong. I love games as much, if not more than the average player. But to quote Mr William Shatner in a very appropriate manner: ‘Get a life!’

So, when I looked at some of the details after the first wave, I had an option to sift through the information, and a few very scary thoughts were starting to form. The steps taken are very very appropriate (from the viewpoint by Sony), yet, we are about to get an entirely new wave of revenue driven groups, and before too long, it will cost you!
This might even more then you bargained for and there might be little to no chance to avoid it with all impending consequences. What am I talking about? Let me explain!

First the mundane stuff:

It is mentioned to have eight cores and an enhanced PC GPU. This system will work at speeds approaching 2 Teraflops. There is a lot more, but the issue is set in the next part I mention: “PS4 to include cloud and game live-streaming functionality; focus on social networking; global Gaikai network rollout.” (Source: Gamespot).

Am I just spouting out some facts? Perhaps, however, consider that managing multi core processor systems are a lot harder than most people realise. However, inserting code that accesses non-used, or less used processors is hard, but when active, they can remain undetected for a long time. Now add the thought that such malignant code is added through the DLC that is added to the game and we have a silent data screamer. This is the other less known side of anti-viral solutions. Data viruses are almost impossible to track, unless you track EVERY process, which slows down any system scanned.

Its opponent, the new XBox720 is still a question mark. There are loads of rumours, however, no real facts. It is however very likely that the Social Networking issue will be included. This is going to be the real problem.
This step was unavoidable.
Let’s face it, Facebook changed the world forever! However, if we take into account the shadier side of social networking (aka cyber criminals) then you might begin to realise that your goose could be cooked. We are not talking about an account that gets hacked. No, that would be too simple. For this part, we need to take an additional look back towards last October where insurers were mentioning that mentioning absences on social media might have consequences.
In December 2012 the insurance council of Australia made this quote: “The insurance industry is urging holidaymakers to keep their travel plans off social networking sites such as Facebook and Twitter to reduce the risk of burglary over Christmas”. This is actually late in the game as the British Insurance Age wrote this in June of 2012: “Social media-savvy young people could represent an emerging market for on-line risk insurance cover, according to research conducted by the Chartered Insurance Institute (CII)” So, here we can pretty much replace the words ‘emerging market’ for ‘additional costs’.

There has been the odd wild story on how a person tagged in a photo on Facebook through their smart-phone was enough for burglars to know that a house was empty. Now we add Social media to a gaming console? I could go for the kids and computers next, however, the bulk of gamers on systems like that are likely to be adults. Being adults does not mean that they are in ample supply of Common Cyber Sense. Let’s face it; loads of advanced users tend to lack such skills. In addition, we will now have to contend with consoles in need of Anti-Viral Software (to thwart Social media Cybercrime) and a league of other issues.
Let’s mention the issues that Sony had in the past with their hacked databases. Should we wait for the first time loads of credit cards go into some auto-donation mode? (With cybercriminals as the designated benefactor). I am not kidding! Yes, you will hear on the amount of safety Sony has, and the people will be perfectly safe. Spokespeople and Marketing spins will all make the case that we are all perfectly safe. So, let me remind you, or if you did not know inform you that in April 2011 the information of 77 million account holders were stolen from the Sony network. On May 4th of that year Sony confirmed that personal identifiable information was stolen.
Now they want to add their console to social media?
How long until the insurance company wants additional policies? How long until the insurance company decides that ‘it’ is not covered? Who will pay then? Sony? Or will they say “Oops! We so Sorry!” and leave you hanging with the consequences of the event.
I am not having a go at Sony here (even though it sounds like it).
There are several factors that should be seen as hazardous to the gaming health if those new console owners continue in an on-line/cloud gaming experience. First of all, cyber laws are shaky on several levels, especially when foreign criminals are involved (finding them is often a near impossibility). There is evidence on several levels that most of us are not ready for this level of integrated social media. Not because we do not want to, but because our systems can be invaded on many levels at several points. This is the consequence of evolution and people going to the edge of new technologies. At some point it becomes a clear that adding more and more is becoming counter-productive.
Then there is the part of additional revenue. Sony and Microsoft want all these sides to social media, for the simple reason that all that information is worth a massive amount of money. ‘free’ data, all there waiting to get scooped up by the container load. Would we get paid for this? Very likely not! How long until a non-adult gets to click ‘yes’ on an option so he/she gets it for free? Who is then liable when things go wrong? (When they go wrong, not if they go wrong!).
These are all the dangers of social media on the internet. Then finally there is their mention of Cloud gaming. Another new Hype that will be added for gamers. Yet, there are several levels of dangers. This is not just something I am claiming. Several exports on this field from data providers to the technology providers at Cisco make mention of this. They are warning us on levels of dangers when it comes to Cloud issues. So, the cloud, especially with data at rest will need several levels of monitoring and all this takes resources. So, how will we be charged for those? You can bet your house on the dangers that ‘free’ options there will come at a much higher price down the road and not unlike Facebook, should you stop gaming, then what will happen to the data?
The weird part is that most of these issues belong in medium to large sized companies with able IT coverage. Not in the average household where the IT expert is 11 and has a Nintendo 3DS!
Should you consider this and wonder how much time you have. Well, this console is to be released in 2013 and disaster could strike in 10 months, 10 days and 10 hours from now. Questions need to be asked, and those who protect the gamers (read citizens with a console) need to realise now that ALL data can be gotten to by cyber criminals, and in many commonwealth nations the law and the law enforcers are not up to scrap within that timeframe.
My biggest issue?
A device meant for entertainment is thrust into a grey area of legislation for the benefit of massive amounts of revenue. The moment our personal data goes somewhere else, those who enabled this in the first place will likely pass the buck to an area of non-accountability.

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