Tag Archives: Financial Times

March 18, 2019 · 11:21

Media out of bounds

This time I am at a loss. I know that discrimination and racism are entities that exist, yet until last weekend I had no idea that governments would be condoning it. There is absolutely no other way to see it. There is close to 0% of the educated world that does not know that something horrific happened in New Zealand last weekend, 50 lives were lost. So for the most, the entire planet is capturing the moment for their audience, their readers, or so one would think.

There were some rumblings via Al-Jazeera initially, but I was focussed on other matters. Yet when a friend gave awareness to a front page of what might be the biggest newspaper in the Netherlands, it is time to look at the issue at hand. So this large newspaper (large in size as well) decided to use 2/3rd of a page for a photograph of a formula one racer ending in 3rd position taking a selfie. Now in fairness, it is a Dutch racer, so there is national pride at play, but for a newspaper that always has been on the front seat to blow terrorist actions out of proportions (the emotional drive) to take this step is just insane. As such a 3rd position is more important than 50 dead Muslims killed by a Christian?

Because that is the setting!

The Daily Mirror made it worse by having in one instance the stage of an ISIS Maniac (a previous event), yet in the case of New Zealand it is an Angelic boy who grew into a mass killer. The images are also staged for maximum effect. So how islamophobic has the Christian world become?

Because if this continue we are merely one step away from the stage where niggers go into the back of the bus, and will anyone react when it happens to the busses in London and the trams in Amsterdam? If this upsets you, good you should be! You need to get angry because this is just insane; to allow for two measurements, one for Christians and one for the rest? Even as a Christian I find that method of measurement revolting.

At least the Sun gave the goods and a lot more, merely on the front page. It should be offensive for the Dutch Telegraaf to be seen as inferior to the Sun, yet they pulled it off that day. I have looked at hundreds of images of newspapers, plenty in languages I cannot read (and cannot state what they say), yet nearly all papers, except the Daily mirror, all saw a monster, a madman and a terrorist, none of them saw some angelic boy reference.

There is something wrong, it has been wrong for a long time, yet this event is probably the first time that the issue gets pushed to the foreground this clearly. I have stated several times (my personal point of view) that the media facilitates to their shareholders, their stakeholders and their advertisers in that order, beyond that the audience gets served. When we take that into consideration, I wonder which individual was so set on getting the Angelic reference printed, the Catholic Church perhaps? As for the Netherlands, a nation filled with business driven needs, the idea that the front page required a 2/3 page for a photo of a driver making a selfie is equally weird. In that view, was it so weird for me to make the claim that the actions in New Zealand are seemingly just the beginning?

This view is only enhanced when we see the Financial Times giving us yesterday (at https://www.ft.com/content/13227c90-487b-11e9-bbc9-6917dce3dc62) ‘Police believe New Zealand shooter may have acted alone‘; the reports in the last 36 hours contradict this strongly. The spread of the manifest, all set to the stage mere minutes from the attack, the stage of reloading, the setting of time until capture whilst the video and stills had been uploaded to a whole range of locations. So when I see: “Security services under pressure to explain why Brenton Tarrant was not on a watch list“, I see a much bigger issue. I think they are aware that he did not act alone, they have no way to find them at present and that is the larger issue. When Mike Bush gives the Financial Times: “He also defended the police response to the mass shootings on Friday, which saw 28-year-old Brenton Tarrant target Muslims praying at the Hagley Park mosque in central Christchurch and then drive about 5km to the Linwood Mosque, where he shot more worshippers“, I will not disagree. This is not something that New Zealand was prepared for, the fact that this person went to a second place is a larger issue and when we see: “within 36 minutes we had that mobile offender in our custody“, we see the issue. He ‘wanted’ to get captured (massive speculation on my side), more importantly in that time frame he could not have done the digital part. It shows that he was not alone in this; there was a support system in place. Another source gave us that this had been planned for two years. That might hold a truth, but the entire setting with the Bangladesh Cricket team a mere 50 meters away gives rise to slightly bad timing, this means orchestration. It is massively unlikely he had all those parts available. In this the politicians are making matters worse. This is seen with: “Technology platforms, including Facebook Twitter and YouTube, are also facing growing criticism from politicians over their failure to prevent the gunman live streaming the shootings on the internet and subsequently allowing the sharing of the video“. This is seen with the Twitch statistics that report “As of May 2018 there are 2.2 million broadcasters monthly“, that comes down to 72,330 streamers every day, there is no technology that will monitor it; there is no AI that could intervene. That solemn common sense moment makes the involved politician part of the problem, not part of the solution. Consider that out of all 0.000138% uploads one is optionally an extremist (this implies one extremist every day), so the number ends up being 0.000003% is optionally too dangerous. We cannot get politicians to put in the effort of keeping up a decent information system that is 75%-80% efficient and they demand 99.999997% efficiency from technology platforms? Politicians have become that delusional. And in addition, there is no way to get them all aboard, making it an exercise in technology discrimination, so in light of what the newspapers get away with, we see no validation on these politicians being loud to get some limelight.

The ‘evidence’ that he did not act alone is seen with “She also revealed that the gunman emailed a copy of a manifesto, which outlined his extreme right-wing, white supremacist views, to her office nine minutes before the attack began. She said it did not include a location or specific details that might have enabled authorities to respond faster. The manifesto was also sent to media groups“, the flaws and other parts showed that his agenda was not some clockwork orange, and the expression fits. When you consider “something bizarre internally, but appearing natural and normal on the surface” we see the larger failure. His actions, his manifesto and his preparations, bizarre on several settings, yet he raised no flags. This is not an attack on the intelligence groups (not this time anyway), yet to do all this, to not raise flags, that requires training and coaching. Even if he was super paranoid, the weapons and ammunition required would need all kinds of assistance (optionally from the criminal elements), but when someone buys all this hardware and ammunition, there is a trail, there are other paths that would have raised a flag or two, yet apparently he had none, this can only be done if others did part of that; an IT ‘friend’ setting up the accounts, the scripts and the stage of forwarding all the images and streams to multiple locations. Was the setting of the Cricket day predetermined? That might have been very likely, yet to know where they would all go for the religious service, how did he get that information? Too many elements cannot be answered with ‘lucky’. My point of view becomes a lot more acceptable when we see: “In the first 24 hours we removed 1.5m videos of the attack globally, of which over 1.2m were blocked at upload” and that was only Facebook, so they blocked less than half at upload, yet the amount of uploads and sharing gives rise to a much larger issue and even as we accept that many are not from extremists, merely from people forwarding what they saw, this was ONE channel. 4Chan, 8Chan, YouTube, Twitch, Twitter links, the list goes on and all can link to one another. This was more than being prepared; Brenton Tarrant had either direct support or a support system at his disposal. They are not the same yet at present the police and the Intelligence community cannot answer which is which. In that same light, I am not entirely sure if tightening gun laws will solve anything. It is so easy to look at guns and their laws, yet the oldest rule applies. Guns do not kill people, people kill people.

In this we must admit that PM Jacinda Ardern has a close to impossible task at present, not merely because of how rare gun violence is in New Zealand, it is the response that some of the media is giving. From my personal point of view some are facilitating to anti-Muslim events. I see the Dutch Telegraaf and the UK Daily Mirror as direct evidence of this. If there was a united front the news would have reported it as such, yet as one twitch was not stopped and 100% more in news coverage was able to give a presented minimised violence footprint, we can say that the technology platforms are a lesser concern than the media is currently showing to be.

It is in that same view that I oppose: “Terrorism experts said the Christchurch attacks showed there was a need for police to focus more on far-right extremism“, I oppose it because the statement is against one successful attack. The issue is not the person; most extreme right people tend to be dumb as fuck (a mere casual observation on American far right wing elements). The elements that made this a success is more important, the timeline, the hardware and the software shows that Brenton could not have done this alone, even if he did do most executions alone, someone taught him to remain under the radar; especially when it comes to the weapons, the ammunition, the IT requirements, the streaming and editing. He would have been on someone’s radar, the fact that he was not makes it a larger issue, not merely some extreme right issue. I can to some extent agree with Jose Sousa-Santos, director of the Strategika Group when I see “there may exist within the security and intelligence community an institutional culture in which Muslim, indigenous and activist individuals and groups are perceived to be the greater threat to national security than right-wing extremism“, yet that does not deter from the fact that Brenton should have been flagged at least once, the fact he was not gives rise to the larger concern of support towards his actions.

So in the end The Financial Times got a lot right, yet the title will remain under debate making it a much larger issue for Mike Bush and Rebecca Kitteridge for the foreseeable future.

 

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March 15, 2019 · 11:20

Shrine of the Tooth Fairy

It has been almost three months since I wrote ‘One to the hospital, one to the morgue‘ (at https://lawlordtobe.com/2018/12/17/one-to-the-hospital-one-to-the-morgue/), it was all about Interserve and new we see that not only did I see matters correctly. One of my finest diplomatic moments was seen with: “we see the mention of “limiting the cost issue by 1.8%, whilst adding debt reduction by 5% in two years’ time is exactly the message in a stage how we should read it, A Joke!”, oh and that is all whilst in those 7 months £300 million was added to the debt, is anyone waking up yet?“. The Guardian gives us less than 5 hours ago (at https://www.theguardian.com/business/2019/mar/14/interserve-shareholders-vote-restructuring-plan-emergency-meeting) ‘Interserve could enter administration as it fights for restructuring‘, we see that options are considered at the shareholders meeting on Friday, that whilst the actions see now could have been done three months ago. Inaction comes at a price but not for the decision makers who got paid for every day of inaction, and a lot more than the sum of most incomes of those about to lose a job (OK that was an exaggeration). And when we see: “their verdict at an emergency meeting on Friday on a proposal put forward by banks and hedge funds, which have offered to forego £485m of the company’s £631m debt in return for most of its equity, leaving existing investors with just 5% of the shares” I am actually more worried, not less. In the first what happens to the outstanding £146 million of debt? That remains apart from a loss of 95% on the shares for the ‘investors’. We should acknowledge “The US hedge fund Coltrane, the largest shareholder with a stake of nearly 28%, has been holding out for a better offer and may command enough support to derail the plan.” Yet when I also consider ‘on a proposal put forward by banks and hedge funds‘, we need to consider that Coltrane already put a safety net in place, they have not been sitting still for three months. That safety net is shown at the very end of the article with: “The US hedge fund is understood to have indicated that it would be happy to allow the company to go into administration and would seek to negotiate with EY to cherry-pick parts of the business to buy“, a non-solution for Coltrane will be a stage where they get all the cream of the herd and owning 28% of that non loss driving mess, we cannot really blame them can we?

In the article one other part stood out. When we see: “maintaining military bases in the Falklands” I wonder whether this is part of a much larger military contract, and if not, what were they thinking? I am not against military contracts, far from that, but to add one in the middle of nowhere, where their only lifeline are charters from Santiago Chili, as well as a military flights twice a week from Brize Norton (apart from some cruise boats every now and then). When you consider that the closest land is 800 Km away, and the flight from Santiago is 2200 Km, which equate to a flight from London to Libya, we see that this one project alone requires us to look into the depth of decision making. It connects to the larger whole. If we consider that the military contracts were lucrative, isolating them and making them a foundation would have made perfect sense. the fact that the military contract(s) are up for grab in an age when we see all the noise on Huawei and non-proven dangers, all while Interserve is screwing over military security through their decision cloud of non-clarity gives rise to a lot more questions on a several fronts, don’t you think?

And the fun does not end; when we see another source giving us both ‘Interserve calls for ‘positive thoughts’ ahead of crunch vote‘, as well as ‘Employees urged to use social media to say contractor is a ‘great place to work’‘‘, we see another path that is ignored. The source was the Financial Times (at https://www.ft.com/content/0be957a6-4663-11e9-a965-23d669740bfb), yet the missing part is that the board of Interserve put themselves too thin on the board whilst there were plenty of indications that they were risking too much. Like players in three card poker, betting too much, too often and not having the money to cover the bets. Unless you are the house with all the capital you cannot win that equation. Winning the lottery has better odds at that point. So when we see: “The power point presentation — seen by the Financial Times — suggests that employees share on Facebook or tweet “what a great place Interserve is to work and why,” or how we “continue to win bids and contracts and deliver an excellent service to our customers”” I see a different version. I see the board all paying at the shrine of the tooth fairy for pain relief 297 seconds before the root canal starts and the surgeon is all out of Triazolam. Optional the dentist has Flunitrazepam (read: Rohypnol), yet the patient could end up getting screwed in the process and live with a gap in their memory on whether it happened or not. It sounds harsh, but that is the setting.

The matter gets clear when we consider the quote in the FT: ““Value is being lost every day in Interserve,” said one person close to the board. “If we go through a pre-pack there is more noise around the business and it could take months for suppliers to understand.”“. A part I already clearly saw three months ago. There was no other path there. the view was clear (to me at least) when you looked into the projects that have been up for media presentation, whilst the bulk of all other matters would have been above 0, that would have been the strength of negotiation for Interserve, but it was not to be. Even as the government was steady and willing to award more projects, there should have been a clear path showing the last 12 projects and the gains made in those projects. It was not done, was it? On December 17th the Financial Times made a similar observation (at https://www.ft.com/content/a15ed306-ffaf-11e8-aebf-99e208d3e521), yet there they employed that awkward concept called diplomacy. They gave us: ““The government refused to bail out the company despite the number of contracts involved,” said Tom Sasse, senior researcher at the Institute of Government. “This exploded the idea that the government would always bail out the sector.” Austerity, initially the sector’s friend, has also been its undoing“, I personally believe that part of the board of Interserve were still in the delusional stage that ‘too big to fail‘ could optionally apply to them. The finicky part where the UK government is close to two trillion in debt (£1,900,000,000,000) seems to have been forgotten by everyone. It limits actions for all involved, and next to that the business model of Interserve was less supportive than a soaked tea towel, so go figure!

Next to that we also see: “Some contractors — such as Interserve — had been drawn into services through private finance initiative projects, which packaged up the construction with the service delivery” and that is where the Falklands come back into the limelight, the model of services without construction is a very different part in all that and only if there are long term settings in place, the Falklands does not fit that bill. Now, I can understand perfectly that Defence stated: ‘You can do that, if you also do this!‘ It makes perfect sense, yet that is not really shown in the larger picture and if the other projects are below zero whilst the service elements are still part of the costing, we see a shifted picture, implying that they are hiding behind the ‘recycling’ part, yet the overall image was not as rosy, it was flawed on a much larger scale. This is how I personally see it, and so far my view has been shown to be correct. So if the nightmare continues Coltrane gets all the cream (or the bulk of it) and they can continue, the rest is screwed in a massive way and there will be no Rohypnol available when the tooth fairy comes by stating: ‘Wide open please!‘

The news does not end there

Just hours ago, the Financial Times gives us (at https://www.ft.com/content/79f20d9a-463d-11e9-a965-23d669740bfb) ‘UK outsourcer Capita posts big fall in profits‘. It is not nearly a sign of the times, it is crunch time, and the service required from certain parties can no longer be afforded. So when we see: “outsourcer faced a decline in work from local authorities, underscoring the challenge of overhauling the business“, that was never ever a secret, the cash is close to gone. Other solutions need to be sought out and that was a given before Brexit started. Brexit will allow the UK to get back up stronger, but it will be after a nasty negative wave, there was never any doubt on that. I informed my readers of that clear danger for years. So this is not news, I never gave consideration to the impact on outsourcers (not my call of duty), but those who work in that field should clearly have been equally aware, that part can be proven without the shadow of a doubt. In all this, from my personal point of view, when we see a 5% drop in revenue, whilst we also get “pre-tax profits fell 26 per cent to £282.1m last year“, we see a more dangerous path in that. It means that the setting of service versus construction (or better the stage of basic profit) has not been correctly set by these players and it merely shows the dangerous path that Interserve has been on for the longest of times. This could have been clearly predicted on a few data mining pathways.

I am now making a speculative view on a speculative stage based on a data stage that might not even exist. I will pose questions to the data board of Interserve:

  1. Show all projects that yielded above £2 million profit
  2. Link to these all directly linked service projects
  3. Link to that all indirectly linked service projects.
  4. Now show final profits for these data trees.
  5. Add to this the elements staff required and cost of staff
  6. Set a separate tree for the Falklands with items 1 through 3, show that final financial result with staff cost continued over time.
  7. Show the other projects with cost, staff cost and total negative profit.

These seven questions will reveal a nightmare tree, the one Bonsai tree that will break your neck when you fall from it. That is the setting we need to have been mindful of. That is optionally the stage that could show the failing of Interserve and other outsources to a much larger degree; the overall mention of so much more revenue, whilst the entire profit part is back benched for too much and for far too long.

The issue of Interserve et al and their stage of what constitutes ‘sound business’ whilst the dangers of what is around the next corner is ignored by way too many shows a multitude of failures and the inaction from too many people gives rise to other levels of dangers that should not have been ignored, although at that time we cannot fault Interserve et al for ignoring those dangers to some degree, yet with the dangers already on their table ignoring them was not a good idea to maintain, or even a great notion to begin with, not with the livelihood of well over 45,000 people at stake.

 

 

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March 11, 2019 · 11:24

The political blame

I love the Guardian for the most. They have a good grasp of things and we might not see eye to eye on certain matters at times, their opinion is still valued as it enables me to critically reassess my own view. It is the opposing part that got to me this morning as I read an article a mere 4 hours old. The title alone woke me up. With ‘Despite Hammond’s threat, the Tories cannot be trusted to end austerity‘ Richard Partington makes a dangerous statement. Does he imply that the Conservatives love austerity too much (not entirely false), is he making the statement that Labor (the Jeremy Corbyn facade) is likely to end it immediately placing the UK in even more danger? There are several ways to see this. The article with “Chancellor hints that a no-deal Brexit will mean an unwanted extension to austerity“, which is absolutely true in a few ways, still that extension of 2-3 years will be better than the ECB push to set the stage for 15 years of additional austerity. And when we are treated to “The chancellor is likely to argue that money has been set aside for a no-deal Brexit, but should it be avoided, he can use these funds to end austerity. The thinly veiled threat – coming on the day of the crucial vote on whether to leave without a deal“. From my point of view, whatever is in reserve is essential to reduce debt as soon as possible. You see £2.1 trillion in debt is a killer. The interest alone will be well over £210 billion each year. So every month £17.5 billion is required to be set aside (all speculated on interest being a mere 1%), lowering that requirement as soon as possible is the only way to survive whatever comes next. Germany did massively push austerity around 2010 and the debt (as well as the interest) went down. We acknowledge that Germany was in a much better place (export wise), yet the truth in undeniable, the debt is killing the people of England and it needs to stop. Irresponsible acts by Labour in the past got us into this mess and Labor is just too stupid to see the danger that they are exposing their citizens to, it must stop and that was for me the largest reason to embrace Brexit, even now when we see: “For the most part the Conservatives have recycled savings from austerity into tax breaks for the better off” we should get angry, not because of the falsehood, but because of the presentation. You see, any austerity will affect the better off a lot less than the others, there is no denying it. If only Labor had not gone overboard spending the way they did (apart from the £11.2 billion NHS IT fiasco), they had no clue what they were doing and gave us this death through poverty sentence. The banks are all on the side of Labor as they are making bankers rich whilst these bankers do not have to do anything at all, the long term commitment to £17.5 a month does that for them.

Then we get even more fuel with: “Analysis from the New Economics Foundation this week shows that raising the tax-free personal allowance to £12,500 and higher-rate income tax threshold to £50,000 will cost as much as £30bn. The financial benefit of the increases have benefited higher-income households most and further stoked inequality“. In the first, no one, not even the rich oppose the £12,500 part, the part that predicts the cost to be £30 billion is misrepresented as that also includes the losses by those who went from £11,850 to £12,500, and this is the largest part. These so called ‘rich’, an interestingly small number basically gaining a mere £3,650 to be taxed lower earning them £700 over a year, whilst the even wealthier group did not gain the additional benefits as their tax bracket remained the same. As for the numbers in 2017 only an estimated 364,000 (out of 68 million) made over £150,000 a year. An additional 4.2 million got to the £50,000 range. those people are not gaining £30 billion, the benefit is mostly there for the lowest range being the largest group by far and Richard should be ashamed of himself trying to push buttons in that way.

Inequality has been there for a while and it is not due to the tax regulations as such, it is due to Labor (and Conservatives) being cowards and not adjusting the tax machine to make large corporations making pay their due. When we see Google, Amazon and others paying a mere 1%, we need to hang those policy makers in Piccadilly square. That is the real culprit, but it is likely too uncomfortable for Richard Partington to point that out, he likely has well paid friends in large corporations. We can agree that “The deficit is still expected to remain as high as £19.8bn in 2022-23 according to the Office for Budget Responsibility, the government’s own tax and spending watchdog“, and guess what, properly taxing large corporations would have taken care of that and optionally reduced austerity as well, yet policy makers are unwilling to try that as they fear large corporations walk out. So what? Let them go and forsake a 68 million consumer base, they will learn soon enough when that move goes tits up for them.

It is not all him though, Richard is allowed his view (even the ones I very much disagree with), and the issue goes beyond certain people. Consider just a year ago when we were ‘informed’ on Apple at Battersea Power Station, a luxurious setting of hundreds of millions, of course they do not have to pay for it, as the tax payers gets to pay for all the taxation that they do not have to pay at that point. It gets even worse when we see the quotes in the Apple Insider. It is developer Simon Murphy that literally gives those readers with the prospect of them moving to plan B: “We’ll give [Apple] that building at the end of 2021. That’s what everyone is very confident about at this stage“, so not only did they short social housing by 40%, they also give away a place to large corporations? No one is asking questions on every level of government at this point (at https://appleinsider.com/articles/18/09/22/construction-delays-leave-apples-iconic-london-battersea-offices-in-doubt)? It seems that the way we do business has to change quite a lot and it is time to slash freebees to zero for the largest corporations. It is not only the Guardian though; we see a changed stage when we go to the Financial Times. They start (at https://www.ft.com/content/b2225c56-419c-11e9-b896-fe36ec32aece) with: “With economic risks again mounting, the EU needs new instruments” and that is merely the beginning. In addition to all the massive blunders they had by fictively keeping an economy running, by pumping 3 trillion into it, we now see: “reviving part of its stimulus programme after two years of weaning the eurozone off easy money — took markets by surprise. It should not have done. Signs of eurozone weakening, especially in Germany, and in key partners such as China, had been evident for months. Once the US Federal Reserve signalled a pause before lifting rates again, the ECB became likely to follow suit. In his final months in the role, ECB president Mario Draghi is clearly trying to get ahead of events“, form my personal point of view, Mario Draghi (and the ECB) are merely trying to keep the gravy train rolling and pushing the EU citizens into deeper debt with no option to get out, Brexit is the only way to cut that anchor. The ECB has become that irresponsible. It becomes an even larger problem with “By promising a new round of cheap long-term loans to banks willing to expand lending, moreover, the ECB will enable Spanish, Italian and other banks to roll over funding they have already received, some of which is set to mature“, so not only is it failing, the stage that the new debts are there to cover old debts is even more ludicrous and it should be to every person who read that. That is the push we see and we need to get out of it, these debts do not make governments better, they do not set the stage for an actual economy, it merely deposes nations to be ruled by banks, when any population is set to the stage where they are contributing to any economy by being a consumer against those who are not and regarded as a burden, at that point do we see that people are truly no longer equal, we are merely facilitating to the need of the balance of corporations and bankers are placed above the law and above any consideration. So at what point did we see elections that place banks and bankers above the law? And this is merely the beginning; we see part of this shift when we consider the words at CNBC by Invesco’s Kristina Hooper at a deeper level. She starts with: “I don’t think the slowdown is going to be that bad as we sit here today, and certainly that’s not what we got from the ECB [European Central Bank] in terms of their downgrade of growth forecasts“, yet when we see: “Now that we have the European Central Bank piling on, that raises questions about what’s going on. What are central banks worried about that is causing them to make rather dramatic pivots?“, that was actually simple, the ECB is dead scared of the ‘R’ word, it is ‘recession’ that scares them. Recession is on the horizon and basically the large four are all hit by it, or are optionally hitting it next quarter (France, Germany, Italy and UK), and for the ECB that is a problem, it would truly show that their policy was a failure, no matter how you dashboard the results into a precisely sliced and diced result that shows only positivity, the cost of living and the quality of life are impacting all and austerity is not a merely a dirty word, it is at this point a cause of suicidal depression for the many confronted with it. If only large corporations had been truly decently taxed, we could have avoided so much pain. We see even more in the end when we are treated to: ““China is employing a lot of stimulus both monetary and fiscal,” said Hooper. “We could actually see signs of some improvement in economic data in China.”” She is only partially right. China is not impaired with 26 anchors all trying to keep the EU boat on their needy little turf; in addition China has taken the lead in IP and Patents making a huge difference, in this America and the EU have fallen far behind. I have seen them ignore billions in IP merely because iteration is the prospect of long term management for large corporations nowadays in an age when these people are left without ideas, we see them surpassed by players like Huawei and Google leaping ahead and now we see the terms like ‘protectionism’ and how bad it is. On the other hand there is a solution against it, the Americans merely had to accuse Huawei as a national security danger and as long as they do not have to prove it can they get away with it, the moment they fail that they lose a lot more than merely an industry (in all fairness they do not really have any credibility left, so there is that too). There too we see issues; as John Bolton (the Trump geriatric solution to national security) gives us through the Sydney Morning Herald: “Bolton also offered blunt assessments on China’s island and military base building in the South China Sea and raised concerns “Manchurian” chips in Huawei technology could be activated for espionage” in this ‘could‘ is the operative word, there is no evidence, and as far as I can tell there never was. This too links to economies and economic welfare, Huawei leaped forward whilst the bulk of all economies were based on iterative progress. Why do you think that places like Google and Huawei truly leapt forward? Their rise is all about actual innovation, not iterative marketing. This makes for all the difference. And linked to all this is something truly away from the UK. With ‘STC, Huawei complete first indoor 5G trial in the Middle East‘, when we are treated to “Saudi Telecom Company (STC) and Chinese vendor Huawei confirmed they have completed what they claim to be the first trial of indoor 5G in the Middle East region. During the trial in Dammam, STC used 100 megahertz in the 3.5 GHz band on the 5G network, and achieved a peak user downlink throughput of 1.3 Gbps” with the additional “STC said it currently provides 5G coverage in more than 450 locations across Saudi Arabia” and this relates directly to the EU and the UK. To have an economy growing you need to be ahead of the curve and both are no longer doing that in several fields. Even as I personally understand and accept the statements by Alex Younger (fearless leader of MI-6); we accept his position and he is not wrong, but it is inconvenient for the economy. The others are merely supporting fear mongering absent of evidence and it is about to cost them. You see, 5G is the economy maker and even as I have well over 2 billion in IP value ready to stage to those with the proper offer, I am but one person and I am not alone. 5G will drive IP and it will push new borders in IP, specifically in trademarks, a shift we have not seen ever. In all this, we see the stage where not only will we see the technology shift where Saudi Arabia is surpassing the US technologically, they now have the stage where they can push and own a 500% growth all over the Middle East, America lost out by being stupid and complacent in an industry where free runners set the stage, not those that rely on status quo. The UK (and the EU) will either catch up, or be regarded as lost for consideration.
At some point people there will push for political blame, I do not think that this is a great idea, but that is what will happen soon enough and at that point, all those who gave rise to John Bolton and the US administration will face a massive setback, to be removed from consideration in a world where they once had mighty voices, the funny part is that every success that we now see by Huawei and Saudi Arabia will be another nail in their coffin. A coffin soon to be named ‘rented by [irrelevant person]‘. What a legacy to have in an age where political delays were the foundation of austerity through improper taxation of corporation. There is more than one setback on the location called Lake Iteration; I saw that coming a mile away. Too bad that those relying on status quo never realised that blinkers of that nature is only to stop wearer of seeing the bigger play-field through the adaptation of fictively removing fear, fear keeps us on our toes, it makes us consider what others do and why they do it; with blinkers we only see what those in charge of us want us to see and that is a large limitation, it makes us focus on what is in front of us and we seem to forget that we are not alone, by not seeing that others pass us by and we only see that whilst we watch their asses rush forward at that point will we consider picking up the pace, picking it up way too late. That too is part of any economy, it is the essential part of being ahead of the game and the ECB is seemingly all about a horse named ‘banker’ to get that advantage and it is costing us. You see, it is not about Huawei having this advantage, it is about the realisation that British Telecom is no longer in the place where Huawei now is. All whilst there is plenty of documentation that the US has been accusing Huawei since before 2012 and up to now, no evidence has ever been produced. So whilst we can go back to the quote from October 2012 with: “American companies and its government should avoid doing business with China’s two leading technology firms, Huawei and ZTE, because they pose a national security threat to the US, the House of Representatives’ intelligence committee will warn in a report to be published on Monday“, consider the options, is US Intelligence this bloody inefficient and incompetent, or was this about something else? The leaping headway approach by Huawei was visible 7 years ago and in that time nothing changed. That non change is important for the people to realise; it is the UK economy that is getting hit time and time again. If you wonder why austerity takes this long (and longer still) consider the steps that industries had not taken, investments not done and we see non-stop tax relief for those sitting still (read: sitting on their hands). the issues are directly connected and when we realise that Germany has decided not to ban Huawei (a nations decently paranoid on security), when we watch the German economy pick up sooner we all know where to point the finger, we point it at the inactive and the exploitative, when we link names to those connected there, that is when we see a first sign of carefully phrased denials and weighted mention of ‘miscommunication between parties’. At that point, will you be forgiving and accept the ‘moving forward’ excuse, or will you hold them and their tax policies to account to a much larger degree?

Stop blaming the rich, they already got there! You need to go after those facilitators, those looking for free scraps and scraps through inaction; those are the ones you want to make suffer for your delayed and optionally permanently deleted so called ‘quality of life’.

 

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February 15, 2019 · 11:56

Living with choices made

We do that at times, we also endure the bitter fruits that we gained from choices. I made some myself, in two cases I trusted the wrong person and it costed me dearly, an invoice payable over decades. I get that, it was my choice, I was an adult and therefor I accept to live with the choice made. It is partially the reason I go out and expose bullshit artists’ because of the dangers that they represent, as well as their friends who knowingly stand by them. So when I saw ‘UK will not put officials at risk to rescue Isis Britons, says minister‘, the article (at https://www.theguardian.com/uk-news/2019/feb/14/uk-isis-britons-officials-risk-syria-schoolgirl-shamima-begum) gives us “I’m not putting at risk British people’s lives to go looking for terrorists or former terrorists in a failed state,” I personally believe that this makes perfect sense. Some might have a bleeding heart when they see: “it was revealed Shamima Begum, one of three pupils from Bethnal Green, east London, who left to join Isis four years ago, told the Times she wanted to return to the UK“, yet there is no way to tell how radicalised she has become. In addition, even as we accept that “Wallace said that as a British citizen, Begum had a right to return home, but anyone who joined Isis should expect to be investigated, interviewed and “at the very least prosecuted” on their return“, we also need to accept that would need to be under scrutiny for some time to come, she is optionally a direct threat to the Britons around her and as such her return also means putting pressure on the budgets of GCHQ and MI5, so there is that to consider. Now, I am not stating that is a reason to keep her out, yet when people state that they are so adult, so well informed and go to places like ISIS Syria, getting married to a Muslim she did not know, have three children with two of them dead is the lifestyle she chose. In addition there is another matter that I had not considered. Even if she is not radicalised, Sir Peter Fahy (former chief constable of Greater Manchester police) gives us: “The biggest challenge if she did come back will be how the police will keep her safe and how she wouldn’t be some sort of lightning rod for both Islamic and far-right extremists“, as an optional catalyst she becomes a new threat on other levels too, as stated, that was something I had not considered and it is important to see that as a matter that could lead its own life. In all the papers and media events we focussed on radicalisation and we forgot that the threat of being a catalyst is actually a larger issue to consider.

And the news is now pouring in from all sides regarding Amira Abase, Shamima Begum and Kadiza Sultana. As all focus on Begum, we know that Kadiza Sultana is dead, the other two were alive in August 2018, and the present status of Amira Abase will be looked at in the near future. My reasons for having the position that I am showing to have is that all need to be held accountable for their actions, not merely governments and large corporations, individuals as well. So when we see “Aqsa Mahmood, a former Scottish university student, has been put under international sanctions for her role as an online recruiter, with other female jihadists including Khadijah Dare and Sally-Anne Jones have called for terror attacks on social media and called on other women to follow them to Syria” (source: the Independent), we need to realise that a governments job is to keep its citizens safe, with the danger of radicalisation and being a catalyst becoming too large a danger, there is everything to be said to leave these people to their fate, so they either become a danger or they die. It seems a simple equation. Yet, we know it is not. The move by more and more Muslim girls (and women) from the UK, Belgium and the Netherlands to step onto the ISIS platform is a given stage for dangers, more than we see at first light. You might think of Robert Ben Lobban Wallace being a softy, think again, he is Sandhurst trained, and a Scots Guard commander with 24 years of intelligence experience. He knows what he is in for and he is more aware of most on the dangers that former ISIS women present. That needs to be taken into consideration before we give rise to: ‘Let Shamima Begum come back, say Bethnal Green residents‘ (the Guardian), ‘British schoolgirl who fled London to join IS pleads to come home to have her baby‘ (News.com.au) and ‘UK schoolgirl Shamima Begum who fled to join Islamic State ‘wants to return home to England’‘ (ABC). you see, the moment she is back and some misguided catalyst event explodes (optionally very literally), we will get all the accusations and all the pointing fingers of a failed police force, yet from my point of view, the people of Bethnal Green will not be allowed to complain. It will be the direct consequence of ‘let her come back‘ and the family members of those victims can ask those people for reparations and grief counselling. So as we see the impact of Shamima Begum (19) mother of three with optionally only one child left alive is seeing the impact of what she thought would be a fairy tale in ISIS. The people who stayed awake have been aware of the danger that ISIS is more than half a decade before she left, she merely listened to the wrong people and it got her family and optionally soon enough her killed. That is the impact of terrorism.

ABC News also gives us: “Independent of this, Home Secretary Sajid Javid is expected to weigh in on whether Ms Begum should have the right to return to the UK, along with intelligence agencies MI5 and MI6 and counterterrorism police, who are anticipated to conduct further investigations into potential dangers Ms Begum could pose to the UK“, the issue is not merely that, the words of Sir Peter Fahy are important too, it is not merely what she does, it is what triggers others to do because of her that counts too and that is where the problem begins. This is not merely come algorithm, it is the dimensional impact that others will trigger at her presence, merely via news, or by seeing her. The part that is not about whether she was ISIS, but the part where others see her as a member of ISIS until she is dead, that is the larger issue and there is no way to set that stage in a dependable way. It is like fishing for sharks in the North Sea. You can go to places where they are most likely to be found, yet throwing out bait and a fishing line does not give rise to catching a shark, you could end up with another fish entirely.

It is in that light that I oppose the view of Amina Mohamed, 52, a housewife, who gave us in the guardian: “She was a baby, she didn’t know what was going on there. People played a game with her and brainwashed her. She was a child“, she made a very clear choice, she decided not to listen to her parents, and it is actually that simple. I do not have much on the parents of Shamima Begum, yet the Evening Standard gave us: ‘after deceiving their parents‘, so in all that, it seems to me that a choice was made and as such, they will have to live with the consequences that they created at the age of 15.

The BBC (at https://www.bbc.com/news/uk-47240100) if the sides in all this as even as there are sides that give rise to the responsibility of the British government, the question that we cannot answer is how radicalised has she become? The fact that we see: “She and two friends – Amira Abase and Kadiza Sultana – flew from Gatwick Airport to Turkey after lying to their parents about their plans for the day. Their aim was to join another friend, Sharmeena Begum“, there is a part that is seemingly ignored by a few people. Not only did was she able to get to Turkey (so they had passports and they tend to take a while, and apart from the fact that an unsupervised minor got one), the fact that the BBC gives us: “The trio were picked up by smugglers working for the IS group and taken across the border into the group’s territory in northern Syria” that there was a logistical support system in place that set the stage for minors to get to Syria from Turkey, the costs that is involved (three times £175 plus additional expenses), the fact that Gatwick raised no questions on unaccompanied minors, the smugglers they willingly followed (so waiting at the airport), there is a larger support system in place for this. There was a recruitment drive and there is a financial stage in all this. There are clear reasons that no one on the ISIS side wants her to be able to talk to MI5, so the issue is not that clear and it is a lot more hazardous for those around any of the optional two still alive that make it back to the UK, so from where I stand, I see that Sir Peter Fahy is correct in several ways.

Investigating these elements should be high on the priority list and they might be, yet the coverage I have seen so far does not ask any of those questions, do they?

I do realise that the entire matter is more complex that this, yet the fact that dissemination of information is lacking levels of scrutiny is a larger issue that needs to be addressed. To see this, we need to consider to parts, first a local one. In Australia Jenny McAllister has voted very strongly against more scrutiny of intelligence services & police on several occasions. Now, that is her right and partially it is her duty to vote one way or the other. Then there is the Financial Times two weeks ago who gave us: ‘Foreign Office criticised over scrutiny of UK spy agencies‘ (at https://www.ft.com/content/4a1cc4e6-2619-11e9-b329-c7e6ceb5ffdf) and we see: “The two agencies use section seven of the 1994 Intelligence Services Act, often referred to as the “James Bond clause”, to authorise activities overseas that might otherwise lead to criminal and civil liability under UK law“, yet in the same trend we see a lack of questions when it can be established that 15 year old girls are recruited in the UK, there is a logistical support system to get them to Syria and the media seems to remain oblivious to a much larger degree (it is the people need not know approach) to something much more pressing in all that. I must have forgotten the lessons on common law regarding the recruitment of children for criminal purpose, how did that go again?

So when I see: “Such missions could include MI6 agents breaking into properties in foreign countries to obtain documents or GCHQ infiltrating computers and networks in ways that might otherwise fall foul of UK laws“, which is a larger implication when a 19 year old is having her third child and it raises no questions, especially as the marriage might be seen as illegal?

At that point my question towards Dan Dolan, deputy director at Reprieve, who is so about doing the right ‘thing’, will be about: What should we do? How far are we allowed to go to prevent recruitment and radicalisation of minors straight out of primary school? How far are we allowed to go to keep British children safe? I think that plenty of intelligence operators lost the plot in the Huawei events (which the Financial Times endorses with a photograph), yet when it comes to threats like ISIS the intelligence industry hasn’t even seen the outer limits lights at present, I am not entirely sure if they are able to tell the colour of those lights when asked. the larger issue is that the intelligence operators are not merely walking a tightrope, they are walking one that is covered in razor blades and at any time there is not merely the risk that it cuts into the feet, it is also a risk that it cuts the rope they are walking on, giving rise to additional hazards, Shamima Begum is merely one of several risks at present and it is important to realise that a Queensberry Rules approach is not merely making us human and humane, it is getting us killed with 99% certainty, the opposition does not warrant, endorse of accepts any kind of rules. I do hope that the recruitment of 15 year old girls will suffice as evidence at present.

 

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February 14, 2019 · 10:46

The Outsourcer’s Furlong

The race is on, we heard last year just how poorly the setting of Interserve was. We all head how Interserve served the people the small fact that they were half a billion (in £) in debt. I discussed it last December (at https://lawlordtobe.com/2018/12/17/one-to-the-hospital-one-to-the-morgue/) in the article ‘One to the hospital, one to the morgue‘, and if the previous financial model applies, there is every consideration that so far another £200 million has been added to the debt. The guardian gives us: “the directors danced around the issue. A “fully consensual” financial restructuring would be preferable but Interserve was “also actively preparing alternative plans to ensure the proposed transaction can be implemented in the event that shareholder approval is not forthcoming”“, and as they very correctly state it ‘What alternative arrangements?‘

In this Coltrane and Farringdon Capital Management have between them one third of the equity and the message of “the proposed £480m debt-for-equity rescue in which the banks would take control and current investors would be diluted to just 2.5% ownership“, you can imagine that these two campers were not happy. They stand to lose it all if things go pear shaped, the awkward impact of a wrong investment made bare. The fact that these two could stagger it all if there is not a full house (which is the most likely event), could stop everything and as the Guardian states (to be more specific Nils Pratley does at https://www.theguardian.com/business/nils-pratley-on-finance/2019/feb/13/interserve-needs-a-plan-b-given-the-rebellion-over-its-current-plan), a plan B is needed. I personally think that a plan C is equally essential. At present chairman Glyn Barker has his work cut out for him, not only are 45,000 out of the 74,000 employees in the UK and they are waited with baited breath, there are more than two parties that are on the ropes and he needs the bulk to fall in line with his vision. One part is the lucrative Interserve Saudi Arabia. Even as it is profitable now, it is also in demand now, auctioning it off to Salini Impregilo could give them a decent reduction in debt overnight and with matters in Saudi Arabia as they go, Salini Impregilo needs the workforce, they are scoring job after job and at some point the workforce will not hold up to the scrutiny of deadlines. As it includes presence in the UAE, Interserve might want to choose dollars for doughnuts before the stage has changed and all that they can hope for is 10 cents to the dollar, because at the stage where two players having one third push for change, Salini Impregilo merely needs to wait for Interserve parties to become utterly desperate and that given stage is a little more realistic than some players are comfortable with.

If debt reduction is the goal and we see that their Middle Eastern part involves:

  • Hospitality and leisure
  • Oil and gas
  • Retail
  • Transport and infrastructure

I see at least three branches that could be pruned and it is a first step to push Interserve back to their core and optionally into a field where cost becomes increasingly lower than the current balance statements require them to be. A similar view could be held for the US and Asia. I wonder just how profitable these branches are, the total debt implies that it goes way beyond the UK (or the UK part is optionally mismanaged in the most dreadful way). I am not implying or judging, half a billion in debt is doing that for me pretty convincingly.

So as the Times gives us: “The New York hedge fund attempting to derail the £905 million rescue plan at Interserve is nursing losses of nearly 90 per cent on a £25 million bet that the public services contractor could recover without falling into the hands of its lenders“, we also see another side. The fact that we see someone hedging 3% into moving away from the £900 million rescue plan, and losing 90% of their attempt also implies that the tress intensifies. Another view is given by the Financial Times (at https://www.ft.com/content/8cd9d920-2b98-11e9-a5ab-ff8ef2b976c7) with: ‘Hedge fund in Interserve feud profited from Carillion collapse‘, with the addition “Coltrane Asset Management, the biggest investor in Interserve, earned £4m wagering on Carillion’s collapse by selling its shares short“, so why give them any consideration? the fact that they decided to add a 20+% share in Interserve with the assumed and highly likely path to try that trick a second time implies that they have no vested interest in the firm, merely a need for greed. So why cater to that? When we are given: “Carillion collapsed in January 2018 leaving banks, investors and pensioners nursing heavy losses and the government struggling to deliver key services such as hospital cleaning and school meals. Some 3,000 staff lost their jobs, with another 14,000 transferred to other employers, in one of the biggest corporate failures in British history“, we know that this was not the fault of Coltrane Asset Management, yet they had no issue selling it all down the drain as it allowed them to fill their pockets. We get it and we do understand that Coltrane is in it for the money, that is how the cookie crumbles, yet when we see the impact on an optional 74,000 employees, we need to look beyond. It is not like Coltrane is taking over and making it a profitable setting, are they?

We do get that Coltrane is not the actual evil party in this, unless they explored short selling here too, at that point they are on their own. Coltrane is not without teeth, the mere setting of shareholders losing out on their investment will make them gang together and plenty of them are small investors; it is their retirement that is at stake. Scottish pubs tycoon Alan Macintosh is also still an element in all this, the swap would make him massively rich so he is willing to stick with the plan, there are still 6 weeks until the deadline gives us the setting of the battle line that will be drawn, and where that ends is anyone’s guess. yet as the Financial Times points out “People close to Coltrane said it was confident of winning support from the numerous smaller investors — which include Hargreaves Lansdown and Standard Life“, those with their retirement savings in the balance will turn to Coltrane soon enough, some will be scared enough to offer their part to Coltrane at any amount that gives them more than 30 cents to the dollar, giving Coltrane the option to upgrade the size of the bat that they wield in this encounter, leaving the people at Interserve with little to work with, and in light that there is no plan B or a plan C, gives more and more the impression that they never properly prepared for this war, making the outcome of a win for Coltrane against them a rather large likelihood.

So who goes to a war theatre without at least three options ready? Anyone who starts a tactic without two alternative routes handy at any given time is merely on a one way street to defeat. That is not predictive, that is an issue that has been gospel since WW1, I would go further that the Siege of Khartoum of 1884 was another example to that premise. In those days there were thousands of Brits sneering and making fun of Muhammad Ahmad bin Abd Allah, in the end he walked into Khartoum leaving mountains of corpses in his wake. From that setting alone, the board of directors at Interserve have made a few too many really poor decisions, when we add that to the pile, we see that Coltrane is not done, not by a long short and when it falls over, Coltrane walks away with an ox-cart of gold and a fair share of the 74,000 employees will not be that lucky.

Those who want a better stage better find themselves a new deal and set themselves as independent contractors finding new alliances. It might be easy for some where the market is vastly on the rise, but that is merely in a few places where the stage can be set to take control of the projects, making the situation of Interserve a lot less manageable soon enough.

I am merely speculating now, yet consider the projects over the last 6 months.

  • Qatar National Theatre
  • Southwark Council
  • Highways England
  • North Lincolnshire Council
  • Durham University

These are merely a few of many projects where ownership of the project could revert to other players if the pressure on that project is high enough. Those customers will need to seek a solution for their invested needs and there is now enough doubt whether Interserve can fulfil its side of those contracts, the mere absence of a plan B would essentially be enough to facilitate for change if the proper cards were played and £150 million is nothing to make fun of.

But that could be merely my wrongful view on the matter, we will know soon enough.

 

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February 13, 2019 · 12:58

Life without pension

Yes, that is one of the elements that are now in play, life without pension, work until death. Did you consider this danger when you woke up this morning? It does not matter whether you are 55+ and awaiting your first months on a pension, or perhaps you are a decade younger and you are setting the stage for your house, your family and your future to be decently secure. Perhaps you are young and you do not care yet on how you celebrate your golden years. Yet what happens when you are becoming aware that this will never be the life you can embrace?

For me it is not really a concern, I have always been a workaholic.

Yet the picture I am painting is slowly becoming a reality. I made mention somewhere in 2018 that there would be noise on renewing, or not cancelling the entire stimulus program. I was initially pleasantly surprised that this was exactly what happened. It did not take long, a mere 8 weeks later we see: ‘Dutch central banker calls on ECB to pause plan to ditch stimulus‘ (at https://www.ft.com/content/d42d5c12-2def-11e9-8744-e7016697f225). Here we see: “The European Central Bank should pause plans to ditch its crisis-era stimulus, the governor of the Dutch central bank has said, in a sign that concerns over disappointing economic growth have spread to the eurozone’s most hawkish circles“, In addition we see: “the central bank needed to gauge how badly the economy was faring before pressing ahead with plans to normalise monetary policy“. This is merely one part where we see that the economy is a jester and we are all playing the same card whilst the protected few get the entire deck, an economy that requires $3 trillion and counting to run through invested support is not running, plain and simple and that debt is with us, the tax payers. The idea to runt that bill up higher should outrage us all, no matter what excuses we get to hear. So when we see “he has moved into line with Mr Draghi and the majority on the ECB governing council. It shows the steep deterioration in eurozone sentiment“, I merely see that not only was Brexit the better idea, we need to get out as quick as we can, with exit deal or not.

What do you think will happen when this blows up in their faces? It will; I personally believe that there is close to zero doubt on this. The Wall Street Journal gave us two days ago: “the ECB could raise interest rates this year. If it doesn’t, the bank might turn to new stimulus measures. It has few tools left“, I will go one step further, it has no moves left other than to tap unused resources for short term gains and that is when someone will give the audience assurances with some small ‘extremely unlikely‘ or some ‘failure is too small a factor to see it as any threat‘ mention and soon thereafter that one thing happens and the pensions will be gone. The Dutch Telegraaf reported on that less than 10 hours ago where the reader gets: “De EU-landen willen volgende maand de knoop doorhakken. De PEPP moet het makkelijker maken geld opzij te zetten voor de oude dag door een einde te maken aan de lappendeken van regels in de Unie“, which translates to: “The EU countries want to make a decision next month. The PEPP should make it easier to set aside money for the old age by putting an end to the patchwork of rules in the Union“. Critical viewers see the danger as the mandatory part comes into question. So not only do we see places like Carillion (UK) with their “pension fund deficit of £800 million” a mere week ago. So what happens when this ends up being the impact on a European scale? What happens when the Dutch and Swedish systems (which are among the safest and most secure pensions) collapse? That is not fictive, that is not academic, that is a realistic danger of the PEPP, when those schemes start banking on the wrong bonds and investments there will be no pension left. Good luck getting by with that March Hare menu. The fact that this is getting pushed by more and more marketing, complete with ‘How a US firm pushed for EU €2.1 trn pension fund‘. It makes me extremely cautious. In the age where we see new stimulus replace another, whist there is no economic good to be found, we see more and more debt, the moment the ECB gets there fingers on that PEPP option the fences move and the entire herd of economic protection levels gets squashed, like grapes in a wine barrel, to be diminished to the status of vinegar. So there goes your pension that was initially a decent chardonnay at $15 per 700ml, and is now no more than $2 per gallon, so how does that go over with your planned pension outlook?

The rapid growth of all these international advisors all claiming that the Pan European Personal Pension products (Pepp) are a good idea is making me even less trusting. Having seen the eager needs of hedge funds managers over the decades and their renowned need for greed is making me worried that this will blow up and whilst they walk away with multimillion bonuses, we all end up without a pension. It does not get any better soon. That part is seen through the paper by Paul Cox, Lecturer at the Birmingham Business School (at https://www.birmingham.ac.uk/Documents/college-social-sciences/social-policy/CHASM/briefing-papers/2018/BP1-2018-Pan-European-Personal-Pension-Paul-Cox.pdf), and the first thing that should worry you is: “Currently there is no specific EU legal framework on the design, provision and distribution of PPs“, so not only is this an international product limited by national law, there is every indication that once outside of the borders a lot of national legislation loses its impact and power, giving rise to all kinds of dangers. Even as we are given: “The PEPP takes the form of a Regulation. A Regulation is directly applicable in each Member State and does not need to be passed in Parliament as a Directive does.” This comes with the added danger that these regulations can be altered at any time, giving the rise to ambiguity as well as adaption to fit the need of the ECB, that same entity that callously handed over $3 trillion in stimulus with nothing to show for it. How does that fit your retirement scheme?

Even as we see: “Transfers into a PEPP from any national Member State PP is allowed but a transfer from a PEPP to a national Member State PP is not allowed” and are given the reasoning of “The aim is to prevent possible tax relief arbitrage where the PEPP tax relief is not as generous as national Member State tax relief.“, the indirect danger will be that the PEPP could face additional taxation (on top of the normal national one).

Yet the bigger danger is in the unspoken part of: “An obligation to provide a financial guarantee might lead to investment in low risk and low returning assets, such as government bonds and money markets, which would go against the CMU’s aim of fostering investment in equity and increasing private sector economic growth. A financial guarantee may also create a significant barrier to entry as only some providers would be able to offer such guarantees“, so not only the loss of optional guarantee, yet the bigger part is the danger of much higher risk investments, apart from the partially visible danger of investing in ECB bonds fuelling more non profitable stimulus, the danger of big risk as people experienced in 2004 and 2008, at that point your pension is gone.

That is a direct danger at present and there is almost zero chance that these dangers will not hit you at some point. The problem is that the closer you are to retirement, the larger the impact will be. Some of my friends were hit with their low risk investments in 2008, resulting in an added 10 year shift to their retirement, so retiring at 75, do you think you will be that lucky?

From my personal point of view, it is not the large players that are the danger, there will always be another Carillion, the danger are the dozen small players where we see people diving into a pool they do not comprehend and set aside the essential protections required, all with the view to strike rich fast. In that view, consider the “the fallout of a $235 billion dirty-money scandal that has engulfed the local branch of Copenhagen-based Danske Bank A/S“, then take “the ABLV, Latvia’s third-largest bank, accused of laundering Russian money and starved it of American dollars, forcing it to close“, add “the closure of Malta’s Pilatus Bank and a 775 million euro fine imposed on Dutch lender ING” and the clear message, given via Reuters by committee chairman Petr Jezek: “The Financial Intelligence Units of many EU member states are ‘clearly not up to the task’“, that is the PEPP picture you could face, all getting in and out quick and ransack EU pensions overnight (and all falling over at the same time). There is too much danger and as we might have some faith in the uber wealthy Larry Fink and his need to grow his $6 trillion empire, the danger of small bank barracuda’s pretending to be great white’s or their version of an all devouring Megaladon (thanks Jason Statham) is too great, there is a lack of protection in place and with pensions that is just too great a risk to face. To translate that in other terms. It is not the one player losing $1oo billion that is the danger, it is the setting that 100 players all lose $1 billion at the same time, the systems are often not ready to deal with such a situation.

I fear that the fraud and pocket filling impact by greed driven persons the next time around will be a lot higher, a lot more devastating. I always figured that I will be working should I pass the 77 mark and still be alive, that is the one benefit of a workaholic, is that the view you are having for your retirement at 40+?

BP1-2018-Pan-European-Personal-Pension-Paul-Cox

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January 25, 2019 · 11:54

The Iranian escalation

We know that their nuclear accord is not worth the paper it got printed on. We also know that the involvement in Yemen is a lot larger than anyone has been able to illuminate on (especially the media). Yet the cupcake of the day goes to the Times of Israel (not the most neutral party in all this). they gave us mere hours ago ‘We bought spares for nuke equipment we agreed to destroy‘ (at https://www.timesofisrael.com/irans-nuclear-chief-we-bought-spares-for-nuke-equipment-we-agreed-to-destroy/). It is ‘supported’ with the by-line ‘Ali Akbar Salehi says supreme leader was convinced West would renege on 2015 pact, so replacement tubes for nuclear reactor were secretly purchased‘. We get this part, whilst a mere 4 days ago the Financial Times give us: ‘EU seeks to keep Iran nuclear deal alive despite US pressure‘, a policy state of mind that I called reckless and not too bright close to 5 months ago. So now we see that not only did Iran have no intention to keep its word, it is actively setting the stage of being a danger to a lot more than merely Israel. Has anyone considered the dangers when one of the warheads goes missing, gets an added dirty load and both elements miraculously in the hands of Hezbollah?

This is not a fictive danger!

Consider the following ‘facts’:

  • Article 151 of the Constitution obliges the government to “provide a program of military training, with all requisite facilities, for all its citizens, in accordance with the Islamic criteria, in such a way that all citizens will always be able to engage in the armed defense of the Islamic Republic of Iran.
  • General Qasem Soleimani is in charge of the IRGC army, his direct inner core has direct control of the Basij and they protect and reinforce several locations where nuclear materials can be found. In addition there have been several pieces of evidence that the support of Hezbollah by the IRGC goes beyond simple funds and hardware, hence the danger I am illuminating is not the weirdest one, or the least likely one.

So when the Financial Times gives us: “We need to accept that the [nuclear deal] is important and it has been a signal achievement“, we also need to consider that this is merely what Iran wants you to think. It is a stage that is too dangerous for some ‘peace for our time‘ moment as the UK thought to have in 1939, it did not end well then and it will equally not end well this time either. The trouble here is not merely what is in store for Israel, the defeat that they currently face opposing Saudi Arabia in Yemen (via Hezbollah), it also implies that there is every indication that proxy strikes against Saudi Arabia are not out of the question. I am not talking about the two fired on Saudi Arabia 4 days ago (source: Al-Masdar Al-‘Arabi). The quote “According to the official media wing of the Houthi forces, their rocket battalion fired two Badr-1 ballistic missiles towards the Asir and Jizan provinces of southern Saudi Arabia. The Houthi forces said that one of their ballistic missiles managed to hit a Saudi military gathering near the Yemeni border with the Jizan province.” gives is that Houthi forces are upping the game. Whether Hezbollah is directly involved is unknown at present, yet the danger is that Hezbollah makes for a decent Iranian mule and as such a dirty payload is not out of the question at present. The part that none are giving is that both the Asir and Jizan areas are predominantly civilian and that with the lousy aiming abilities of both Houthi and Hezbollah forces we can speculate that the only way for these two to hit a military target was done by aiming for civilian targets. No matter how it turns out, Houthi (and optionally Hezbollah) forces are waging war on Saudi civilians which is a big no-no and as the Western media stays out of it (to a larger degree) the Saudi coalition will be forced to strike hard and harsh against the enemies of Saudi Arabia. The important part here is that this is no longer merely Yemen, at some point in the near future a meeting and decision will be made to actively engage Iran and that is when all bets are off for Tehran. the evidence shown in regards to the Nuclear deal as well as their involvement in Yemen, we see that both the EU and the US have no other option but to stand by Saudi Arabia in all this, decency would demand it from them and by not doing so, we will see a very different stage and Russia is only one step away from enabling themselves into a political stage of becoming best friends with Saudi Arabia. So as we saw three days ago the statement “Iran has not been invited to a global conference on the Middle East in Warsaw next month and Russia has declined the invitation“. The question in my mind becomes, is that truly the reason for declining, or is Russia playing a larger game? I will emphasize at this point that this is pure speculation from my side, yet if there is chance to get a much closer relationship with Saudi Arabia and get that achieved by ‘seemingly remaining friendly with Iran‘, we see a Russia that has plenty to win with this path. Unlocking the ties between Saudi Arabia and the USA would be one of the greatest wins of the decade for Russia and that danger should not be underestimated.

In the end Saudi Arabia and the Saudi coalition needs to do what is best for them and the events of the last two years give rise to the stage that America has merely been thinking of their own needs in the last 3 years and most allies have had enough of that.

What will happen in the end is not to clear, not whilst there are gaps in either path of allies and whilst Russia is playing its own cards close to their chest, the Americans have been too clumsy for close to two years. The Khashoggi and Yemeni events have clearly shown that part. The media gives us even more when we consider Al Arabiya. There we see: ‘Orchestrated media, political campaign to damage Saudi-US ties, says analyst‘. The quote “I strongly believe that Qatar, Turkey, and certain Muslim Brotherhood proxies in the West are involved in funding a media campaign and political operations to discredit Saudi reforms and the government in general” by Irina Tsukerman (at http://english.alarabiya.net/en/features/2019/01/10/Orchestrated-media-political-campaign-to-damage-Saudi-US-ties-says-analyst.html) is as I personally see it incomplete. She is looking at one part, but there is a second stage. Not unlike the UK actions in the 70’s against the Cairo-Tel Aviv attempts for a peace, we see another stage here too. You see, the events from Saudi Arabia regarding Neom City have been so overwhelmingly progressive that larger US industrials are now worried, they cannot live with the fact that they are soon to be less impressive than the Saudi advances in 5G, it goes further, large players like AT&T are now openly deceiving the people with their 5G Evolution, a product that has been heralded all over the media as a fake product. The Register, USA Today, Android Police, TechCrunch and many others are seeing this as deception. The idea that Saudi Arabia beat them to the punch was too unacceptable to these people. They are increasingly worried that every win towards Neom City will be regarded as a loss towards their own economy, which is the America the allies of America face. It also fuels the entire recession mess that is upcoming, merely because corporations can fund one place and whatever goes towards Saudi Arabia is not going towards other places and in all this, the UAE will benefit to some degree as well. As Saudi Arabia is facing down it’s not so hidden enemy Iran, Saudi Arabia will face opportunities as well as challenges and its allied neighbours will have positive waves of economy going their ways too.

Yet before there can be a positive outlook on it all, the global players will have little choice but to put down Hezbollah as soon as possible. No matter how they try to commit to peace, there is enough evidence that Hezbollah is still committed in wars against Israel and Saudi Arabia. Even as we see “Tens of millions of Iranian dollars have gone to Yemen“, we see that this image is also incomplete. That part is seen when we consider the BBC (at https://www.bbc.com/news/world-middle-east-46958455). When we consider the fact that ‘Pro-government forces removed 300,000 landmines laid by the Houthis between 2016 and 2018‘, the numbers do not add up. the value of the mines, the time required to place them as well as the manpower required to place them we get the clearer picture that the entire funding goes well beyond ‘Tens of millions of Iranian dollars‘. That part as well as the missile costs, the Hezbollah support and other goods imply a financial support that implies close to 1000% of the support that is claimed by some. The found number of mines implies that Yemen required placing 200+ mines a day every day. That require a much larger workforce and support engine (including some form of logistics and communication) than anyone could possible consider. That requires no less than two regiments placing mines 24:7. That is the number that does not make sense in all this and Yemen is not known for soft sands, there are plenty of rocky surfaces to content with. The numbers do not add up and it seems to me that the media has been ignoring those facts to a larger degree, making the Iranian involvement a lot larger than anyone expected, which also implies that the commitment by Hezbollah was a lot larger making them a more essential enemy to get rid of and that part is not limited to Israel and Saudi Arabia. Europe and America have every interest in dealing with Hezbollah with extreme prejudice. Well, that is if they ever want to see true peaceful balance in the Middle East, because with Hezbollah (and Hamas) that will never happen.

In all this Iran has been the catalyst to escalation and it is high time that the global media is taking a very serious look and openly reports on the actions that Iran has been an active participant in, do you not think so?

 

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December 17, 2018 · 12:04

One to the hospital, one to the morgue

It is not a setting, not a statement; it is merely the observation of what we see happen. Yet the question becomes who is who? It is a setting of placing Interserve next to the Cardigan Integrated Care Centre that is where we see a situation evolving. And it would not be a London project that is in danger, would it?

Why the situation? It is the timing, even as everyone is still ‘working with’ and ‘LOCAL health board officials are confident that Cardigan’s new £24m health care centre will not be affected by the financial problems of outsourcing company Interserve‘, I am less certain that this will not have an almost deadly impact on the project. The article (at https://www.tivysideadvertiser.co.uk/news/17301424.interserves-problems-should-not-affect-cardigan-integrated-health-centre-project/) gives the people none of that and as far as I read the article, there is nothing there indicating the views I have, yet the setting is already staged to become worse, much more worse I might add. That is an easily given fact as the project is not due until the end of 2019.

You see, the article also gives us: “Interserve is responsible for delivering the project but there are fears over its future after it confirmed it was in rescue talks that would see retail shareholders virtually wiped out and creditors take control.“ Yet that is not the directive part in all of this, and the article (through no fault of it, or its writer) gives that part to the reader. You see, that part we get when we contemplate ‘Struggling Interserve may hand construction unit to lenders‘ (at https://news.sky.com/story/struggling-interserve-may-hand-construction-unit-to-lenders-11581667). the first question that rises, if there is such a debt, why would we see: “drawing up plans to hand its £250m building materials unit to its lenders as part of an ambitious plan to secure the company’s future“, which is a choice, yet when we see another article also giving us: “Outsourcing giant Interserve is preparing to spin off its lucrative building materials division in a bid to reduce its debts“, so why would a ‘lucrative’ part get sold off? Lucrative clearly implies the part that allows for a much quicker turnaround and in absence, that lucrative part used to keep the lowest bidding in place will also (optionally) drastically increase the cost of projects when it falls away and that is where the Cardigan health centre find itself optionally soon enough. We might think that ‘RMD Kwikform makes equipment used to build concrete structures‘ is no indication, yet this equipment is often merely leased per project and a new owner implies new (or additional) fees or another destination for that equipment, changing the entire setting of the project and experience, as well as history taught us that a board in trouble does not tend to care too much about their running projects.

Am I correct?

That remains to be seen, because there are several factors in this that are unknown, yet the setting that the project is a year away implies that there are plenty of stages uncompleted and they are therefor at risk. The fact that this news is 2 hours old means that there is no given setting, yet the large impacts will be seen in the next quarter and that is when the pennies drop for several projects, the question is on how the stage will be maintained.

The fact that Interserve stock has been reduced by 45% and when we consider that the Interserve board is close to a month away from revealing its plan, as well as the fact that this thunderstorm has been looming for over a month does not help matters.

From another source

The Financial times is giving us another setting here. With ‘UK government to continue awarding contracts to Interserve‘ (at https://www.ft.com/content/03f63e62-fd41-11e8-ac00-57a2a826423e), we saw that the government last week was setting the stage for Interserve to get some deals going as these projects mean money and money coming in is always a good stage to continue the work. So when I see “Government sources told the Financial Times that it does not view the company as another Carillion— the contractor that failed in January — and that it would consider Interserve for further tenders“, we should consider it as a partial truth, when you are down in a debt that soon will be pushed towards an approaching £1,000,000,000 (as I decided to round it towards the worst case scenario), we need to realise that something has gone terribly wrong, That amount approaches to the annual income of 32,000 construction workers, and their pensions, so there is another side to investigate soon enough (although we do acknowledge that the Interserve pension is high in the green).

Are we overreacting?

That remains to be seen. The fact that this large a debt is an issue on something this big needs to be scrutinised in several ways, not merely what is to come, but how come the debt is there in the first place. Improper pricing, inefficient project management, wrongful costs are all stages here that pushes additional costs through the roof and that is where it all hurts, and without proper vetting the pain remains and we will see additional projects operating at a loss. that part was given by Construction News in April this year when we got ‘Interserve suffers £244m loss for 2017‘, the quote “an “inefficient operating model” with high overheads had left the firm “exposed to weaknesses” in the support services and construction industries” by chairman Glyn Baker is clear enough, the wrongful setting and we see an amazing growth of losses and debt. the fact that we were given the implied “Interserve said the business will need a “significant de-leveraging event” to stay viable, which would likely be an asset sale, or raising further equity before December 2020“, which against ‘cut costs by £15m in 2018, and is on course to add £40m to £50m to operating profit by 2020‘ sounds almost like a joke, to with a debt over 800 million (conveniently rounded to a billion by me), we see the mention of “limiting the cost issue by 1.8%, whilst adding debt reduction by 5% in two years’ time is exactly the message in a stage how we should read it, A Joke!“, oh and that is all whilst in those 7 months £300 million was added to the debt, is anyone waking up yet?

In all this, Interserve has gone from bad to worse from 2015 onwards, all whilst some might expect that with Carillion out of play, options for Interserve should have opened up, no matter how bad the market was, one larger player was removed.

Round 2 is worse

The audience has been avoided getting exposed to certain parts of the business, we might not have realised it, yet that part is actually given the limelight by the Investors Chronicle (at https://www.investorschronicle.co.uk/alpha/2018/12/13/interserve-the-warning-signs-were-ignored/). You see, I saw certain parts a month ago, but for me, it was partial news as I never looked at Interserve before. So when we are given certain points, and I am merely leaving the ones that matter:

  • Low profit margins.
  • A reliance on acquisitions and cost cutting.
  • High debts both on and off its balance sheet.
  • A big pension fund deficit that needed large amounts of cash flow to reduce it.
  • A difficulty in converting operating profits into operating cash flow – a classic sign of poor profit quality.
  • The need to sell assets in order to maintain and grow dividend payments.

At what point did we not consider the massive danger Interserve was in? The events that I have been able to track go back to early 2016, The Financial Times in May 2016 and the Independent in August 2016 give us some of the goods, in addition there was Forbes in 2017: “Overruns lead to £70m charge for construction and services group“, as well as “The Reading company advised that a tight control of working capital across the rest of its business last year substantially offset the adverse cash impact over at EfW. Consequently net debt clocked in at between £270m and £280m as of the end of 2016“. It is the fact that we see a clear level of inaction (or bad management) that gives rise to the situation, the fact that these issues were clearly in place almost 2 years ago, gives rise that the government had a clear duty to intervene to some degree, that level might be up for debate, yet the ‘let’s leave it for now’ and the presentation (at https://www.interserve.com/docs/default-source/investors/financial-reports/presentation-results/2018/h12018-results-presentation.pdf) now give the consideration that there is every chance that shareholders might be seeking legal counsel. You see Interserve ‘presented’ the so called facts: ‘Fit for Growth initiatives delivering savings and creating a simpler, more effective Interserve‘, as well as “Overhead reduction and efficiency measures to deliver £15m savings in 2018“, gives serious contemplation that the shareholders were not properly informed of the dangerous place that they were in at that meeting in August 2018. In addition, slide 20 gives rise to another contemplation; the fact that two posts (Manufacturing and Regulated industries) are set to a marker size of £22 billion, 2 out of 7 mind you, and we see the losses incurred, we see additional worries on management and pricing. Even at a 1% margin, we should see £220 million in the plus for these two alone, the fact that the overall is set to minus £800 million, and a mere positive move of up to £50 million is a much larger debate and as such, one might argue that there is a lot more going on in the negative of Interserve that we might think.

Baskets of fruit

In opposition to my own view, I am in several ways comparing apples, pears and oranges and merely labelling the items as fruit, which in itself is not correct either. However, from my point of view, I see a tradesman dealing in 22 billion pieces of fruit and when left with a certain minus to this degree gives clear indication that the entire business model is wrong on a few levels giving additional worries on the earlier reported premise of ‘The need to sell assets in order to maintain and grow dividend payments‘, the conceded view that selling of your land year after year just to look good implies that the farm devaluates with every year and when we see that this has happened from 2016 onwards, the signs given should have been louder by many players and that (to the best of my knowledge) has not happened.

The Coroner is in the house

When we consider the elements, we can also give rise to what needs to happen. If Interserve continues on this path, there is every indication that we see sell off after sell of, with an optional class action against Interserve, implying that the damage increases, so those projects set for delivery in late 2019 and 2020 (A Wales health centre for example) will find themselves on the coroners slab whilst the media looks at the intestines coming to the conclusion that at present there was no way to save the patient, and when we see that, how will that affect the £25 million Merthyr’s Prince Charles Hospital in Merthyr Tydfil? These two are close to £ 50 million, something will have to give and where will the government spring in when they have to? Will they do that? This does not mean that this situation explodes to that degree, but the signs of patient Interserve are not that great at present. And should there be an interception to protect these two projects, does that imply that Interserve is ready to be shipped to the morgue?

That is the foundation of it, because the stage we see now implies that you can save one, but not both. The stage to the degree as I am seeing it should not allow for it in the first place; it does open up new options that as Interserve breaks down we will see new players come to life, perhaps one per construction project, yet that too has the danger of costs going overboard in a large way really fast, that is the nature of the beast, merely because the largest players implying to have the costing down to a margin is a mere 1%, smaller players can never do good on that promise, showing us that costs will overrun on all projects by a fair bit. To see that in a much more local London setting we see places like the Aecom tower and the stage where ‘overly enthusiastic‘ contemplation was set until we got: “profit was “lower than expected due to the losses taken on an underperforming project in one of the company’s core market segments”“. This matters, there is a speculative approach to construction projects and the stage is not merely on how things are pushed, it is on how pricing models are staged and presented by all and that requires a much larger oversight, or better stated, it needs additional scrutiny on a few levels. There is a stage that clearly is part of the Interserve failure. Even if the ‘new’ model implies that we might optionally see: “the tower will now house 861 apartments of which 765 were for private sale, the adjustment now allows for a private sale of 813 apartments“, screwing over even more social housing points. If that is allowed, certain councils should be overhauled and those parts of the stage allowing for that should be required to be facing the dock and optionally dismissal of the project as well as the investment amounts to be considered a total loss. There is a lot wrong in this entire stage and it all started with optional pricing models that were seemingly not realistic in the first place. Carillion clearly showed that element as I personally see it and whilst the board of Interserve is contemplating what to do over the next few months, they to require a level of scrutiny that is a lot larger than anything we considered before. The Greenland Group and Aecom, merely illustrate that what we are seeing in the Battersea Power Station debacle as well as a much larger stage of construction jobs out there (Interserve pricing anyone?).

So when the Financial Times gave us merely a day ago: “A refinancing arrangement between its Malaysian owners has been delayed for the third time; the cost of labour and materials is increasing; the developers have more than halved their expected returns and there are disputes with Transport for London over the cost of the Northern Line Underground extension to the area“, we see that the pricing stage for construction companies (as we clearly see with Interserve) is a much larger concern, we could argue that someone is dampening the cost and margin part merely to get things started and in that trend, we might need to consider other avenues. Perhaps consider nationalising projects in this stage and those shareholders and investors will have to live with their 100% losses. Why leave this level of unacceptable pressure on taxpayers and governments?

And the fake messages of keeping Britain good for investors also required those pricing goons to consider that it comes at a cost. If the players cannot do their job, then those hurt must seek legal consideration against those firms using flaccid pricing models, making matters worse for Interserve, but should we actually care at that stage?

There is every consideration that Interserve goes to the Hospital whilst the projects in wales go to the morgue, but personally I do hope that it is the other way round, as the Battersea Power Station project implies (and a few more beside that); the entire problem on construction has been around for close to 5 years, implying in my personal opinion that these problems started long before Interserve was in the deep financial problems it currently is in, giving rise to several issues that require discussion in the House of Lords at the very least, and perhaps starting the discussion of that agenda no later than week 2 of January 2019 would not be the worst idea as I personally see it.

Do you want to see an avoided discussion on how a health centre went to the morgue no matter where it was supposed to be built?

 

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December 1, 2018 · 13:30

War lines and Battle lines

We all know them, we all personally have them. Some are founded on the realism of professional life, In thee we see the person who works well with others, there is one that is off. You see, that person also wants the senior position you have been working towards and there are two paths trodden at the same time. Your opponent is working as hard as possible to be better and in that same stretch equally is working to make sure that you look worse. The acts are trivial, a little block here, a little delay there and it seems all friendly, it seems corporate, yet you know better, you know that this person is after your future goal. It is corporate politics. You both work towards pleasing the larger shark, you both work to get the amenities to gain favour and play whomever you can to end up being first. It is the corporate environment and we have accepted that for close to a quarter of a century, if not for longer.

It is seen everywhere and this same setting is now in a stage for the conservatives and Brexit as well. Here we see a growing list, a list that currently includes Suella Braverman, Shailesh Vara, Esther McVey, Dominic Raab, Jo Johnson (Boris Johnson cleverer brother), Guto Bebb and now Sam Gyimah. We could go on and point out on how the connections are with places like Goldman Sachs, but that is merely stupidity to the max, Brexit is much larger than that.

And the Guardian (at https://www.theguardian.com/politics/2018/nov/30/sam-gyimah-resigns-over-theresa-mays-brexit-deal) gives us oppositional goods we should not ignore. When we see the quote: “In these protracted negotiations, our interests will be repeatedly and permanently hammered by the EU27 for many years to come. Britain will end up worse off, transformed from rule makers into rule takers“. We see a partial and an absolute truth, we could argue that they are both partial, yet that is actually influenced by the economic powers like Goldman Sachs.

‘Britain will end up worse off‘, I never denied this. The issue is not the temporary ‘worse off’ part, because it is merely a temporary stage, the actual issue is the unaccountable acts by the ECB and people like Mario Draghi. Three trillion all pumped into a stage that was never going to work. That evidence has been clearly seen, yet the overspending goes on and on and on. Being a member of a group where simple book keeping and budgeting is lost again and again due to a two party political game (national party members versus EU party members) is costing the nations dearly and for the most they are all playing possum, it’s not a good thing believe me. The additional issue that all places (like Bloomberg) where we see: ‘Draghi Says ECB Still Expects Net Bond Buying to End in December‘, yet the operative word here is ‘Expects‘.

It is the larger problem in this. Even as the last month has set in we are not given that December is the end date, gives rise to the setting that they want to continue this bad plan. That and a few other parts give rise to walking away. I would personally add that unless nations get the right to targeted killing the heads of the ECB, both present and past (Mario Draghi is about to leave), we should not give any confirmation of talks in any direction. The taxpayers have been given the bills of the high, rich and mighty for too long. When this game collapses (and it will) Europe faces a civil war level of unrest and so they should. They key points in Bloomberg: “The end of new bond buying won’t mean the end of stimulus, Draghi said, in light of the reinvestment of maturing assets, guidance on interest rates and the 2.6 trillion euros ($3 trillion) of securities purchased by the ECB so far. Chief economist Peter Praet made the same point earlier on Monday” gives support to my view (as well as some consideration that we might have to resort to targeted killing at some point).

‘our interests will be repeatedly and permanently hammered by the EU27 for many years to come‘ the second part is the consequence of banks losing power and momentum, because 68 million consumers walking away will hit EVERY book there is and the banks and power players will become vindictive little children as their need and desire for Sex, Drugs and Rock & Roll can no longer be met. Salespeople in a growing economy walk around like the (Pea)cocks that they are, in a recession and shrinking economy the become blaming little bitches, just like every other corporation. I have seen it too often. Making deals they cannot hold and when the facts are laid out they go into the blame game throwing it on the others ability not to be able to communicate. Cash is king, bonus is sacred and the rest can get fucked. That is the world we created and the UK will get hit by it, yet there is also another part. You see, the quiet number two elements in that venue will see it as an opportunity to rise and people like Sam Gyimah know this, he was at Goldman Sachs long enough. For almost five years the UK and Scotland did not consider the power place they had to assist India to become much larger European players and as such get some of that cream. But some were too busy facilitating to Pfizer and not considering the position nearly every NHS in Europe has and the ability for India to become part of the solution here. I saw this opportunity as early as 2013, but the others were too busy looking into the mirror, considering which DJI logo would look better in their photo frame of a long term sustainable life of wealth. During those 5 years Wall Street has all been about setting the stage to build fortresses to protect IP to their wealth. It is the stage of Jonas Salk versus Pharmasset & Gilead Sciences. Jonas Silk walked away from a $34 trillion payout and saved the American people, as well as many millions all over the world. His action caused the eradication of polio, the other two have the solution to Hepetitis C and is set in value to well over $11 trillion, and these patents are still highly protected for another two decades. America only fights protectionism when it suits them, interesting, not?

There is a third part, a part we all (including me) seemingly ignored. The distinguishing of ‘rule makers to rule takers‘ is a path we need to consider, even as the EU gravy train is in full motion, we see that rule makers are only there in the stage of presentation, to keep asleep the masses. If that was not the case there would not have been an Italian Budget issue, but there is ad even as we see: “Rome could ultimately face a fine of up to 0.5 percent of economic output — or some €9 billion“, should we see it for what it is, a joke? The Italians will add the fine to the debt; they will do whatever they please and in that, Europeans are in a Europe where the rich and the ignoranusses do whatever they please. How is being part of that anything but a joke?

  • The unaccountable actions of the ECB
  • The unmanaged ability to keep budget within the EU
  • The lack of transparency in EU politicians (travel expenses anyone?)
  • The lack of long term thinking
  • The lack to innovate parts that need overhaul

The UK has failings there too, yet by themselves they can make amends over time, in this European Union there is no chance of that happening. So, as the UK pushes Brexit, there will be impact, there will be cost (it was never denied), yet as the UK improves its own standing, whilst the EU keeps on going spending trillion after trillion on ‘stimulus after stimulus‘, it is at that point where the flaccid economies (France and Italy) will impact the others and the ‘rise’ and bettered economies all over Europe to the smallest extend, will not undo the overspending to the much larger extend, we will see presented bettering, followed by managed bad news in that same fiscal year. The entire issue with Mario Draghi and the G30 bankers group is merely one visible example of many. If you think that there is no impact, guess again. How long until we learn what happened in the G20, only after it passed the consent of the G30? The Europeans are about to be diminished to empowered consumers versus disregarded collateral. Some went as far as the early 80’s to make statements in that direction, yet the 90’s was too enabling, only now, only as we see that the entire large corporation setting can no longer be maintained, now we see a much larger change and for all those players it is important to sink Brexit. A true independent monarchy is a danger, because whatever step forward the monarchy makes, the other path will have to take two steps back, and you tell me, when was the last time that banks were willing to do that? For that to succeed all European nations will have to be ‘reduced’ to rule takers, and who elected them exactly?

And right there, we see the final part that opposes the quote of Sam Gyimah. With: “It has become increasingly clear to me that the proposed deal is not in the British national interest, and that to vote for this deal is to set ourselves up for failure. We will be losing, not taking control of our national destiny“, you see, in this EU, the British National Interest is merely a presented one, a PowerPoint page in a stage where the EU parliamentarians and ECB dictate the stage without transparency. That part is seen in two headlines in the last month alone. The first is Bloomberg, giving us: ‘Draghi Defies EU Criticism in Attending Group of 30 Meeting‘, the second one is the Financial Times giving us: ‘EU bank stress tests should be redesigned, says watchdog head‘. The second one (at https://www.ft.com/content/868f2dfc-e842-11e8-8a85-04b8afea6ea3), also gives us: “The comments by Andrea Enria, who is set to become the eurozone’s top banking regulator, were made two weeks after the latest stress test results, which saw British lenders among the worst performers while Italian banks largely sailed through“. As we were treated to the Italian issues over the last month, with Reuters taking the Cheesecake with “Italy’s third-largest bank Banco BPM will discuss an up to 8.6 billion euro bad loan sale at a board meeting on Thursday, picking one or two bidders to continue talks with, three sources familiar with the matter said“, I would really like it if someone would have that conversation of applied logic with Andrea Enria in the near future, especially in light of certain facts openly available. When performance is weighted on the absence of bad loans, I reckon that we get numbers that make no sense at all, optionally making the European economy 0.2% better than it actually is. It could push Italy, France and optionally Spain form a positive to a negative economy, when two of the large four are negative, how much trouble is the EU actually in?

I have never trusted any group that demanded continued membership at any cost. If the EU was so great, people would not want to walk away and now we have two members one who is trying to leave and the second one (Italy) is seriously considering walking away. In all this the third player (France) is in a stage where a positive economy is not likely to come soon. Strike after strike is making that an almost dead certainty. I wonder what the numbers would have been if we had removed Greece (not withdrawing support from them though), as they had less adherence and more options to seek solutions, things might actually be less dire for the EU. The fact that once in never out is the standard gave (in my personal opinion) rise to politicians doing whatever they pleased no matter who got hit in the process.

There is one upside, those who have been placing battle lines are now out in the open, so we see a stage where we start identifying the opponents, the question becomes will there be actions, long winded speeches, or denial? Each has a separate disadvantage and none seemingly have advantages, that is also the impact of a ‘once in never out state called European Union’, for all the benefits are merely given in a memo, with bullet points and is redundant the moment that the next memo is released.

Did anyone realise that?

 

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November 25, 2018 · 13:31

The promised example

In light of all the outsourcing we saw yesterday, it is time to show you just how lucrative it can be to set the outsourcing stage. In this example I will go with a software example, as I have seen this myself. You see, sometimes a place is profitable for the mother company no matter how you slice it and with this example we see this in action.

Let’s take a software vendor, selling some software solution. Normally that entire path will set you back $7,000. The software, training, installation and personalising the solution. At this point you might think, well, it is all tax deductible for the company, so what gives?

Well, some of these players still have budgets to adhere to (unless you are in Italy), and when we look at that the procurement department will state that it is too expensive. So, the sales team has an idea. They say: ‘You know what! We can (if you take all three) the entire as a package for $5250, and that is a nice discount‘. So the company takes all this and accepts the deal. So the software is bought, there was a trainer on the spot educating the staff for 2 days and they set up whatever needed to be set up and the entire delivery is complete.

It all seems straight forward. Yet, it is not to be. You see that outsourcers often have a main office outside of that country and they want their franchise fee, which could be 70% of the software, yet they will always get FULL PRICE. So they will get 70% of $3,000, no matter what the discounted invoice was. Now that company has to make due with $3,150 for training, training materials, travel expenses, training hardware and staff. And for every deal they make the cost remain high, yet the revenue has been siphoned off and the cream went somewhere else. Now we get the stage where there was still a profit, yet the staff members are still costing thousands of dollars, as is the office and all other goods. There is not taxation as the revenue was too low and this is where we see the problems for a lot of these companies. They are now in debt, governments having to make deals and I cannot vouch for Interserve, Carillion, Serco Group Plc and Capita Plc, because where I know it was happening was not one of these. Yet I feel certain that others have been playing similar games and it has been going on for over 20 years that I am aware of that tactic.

So does the entire Interserve part now make sense? A debt of well over half a billion and its board members are still up for millions in bonus? I cannot tell what the reason is for the entire Interserve issue, yet what I have seen in the past, we should take a long hard look at what some consider to be debt and what some consider to be an optional approach to deferred invoicing.

We might see partial support when we see the article in the Morningstar (at http://www.morningstar.co.uk/uk/news/AN_1542962437936788100/interserve-expects-higher-operating-profit-despite-construction-loss.aspx). Here we see: “Interserve posted a pre-tax loss of GBP244.4 million on revenue of GBP3.25 billion in 2017. It then recorded a pre-tax loss of GBP6.0 million on GBP1.67 billion in revenue in the first half of 2018“, others sources had a similar setting, yet here we also see the headline ‘News Interserve Expects Higher Operating Profit Despite Construction Loss‘, now we see operating profits versus construction loss? Does it now seem more and more that we are given a half a billion birdie, whilst some are showing to be receiving massive bonus payments? How is this not tackled? How come that for 20 years we have seen the impact of creative bookkeeping, whilst the European governments have been unable to fix anything?

When we see the Financial Times (at https://www.ft.com/content/b2c9fdd2-eeed-11e8-8180-9cf212677a57) giving us: “Interserve employs 80,000 people worldwide — 25,000 in the UK — in jobs that range from cleaning the London Underground to maintaining army bases and building a shopping centre in Dubai.” Giving me the speculative thought ‘How long until we see the Dubai part sold off (including equipment) at roughly 5 pennies to the pound? How would that screw over the 25,000 staff in the UK when Interserve folds? We will not know until the Interserve lawyers and accountants finalise they optimised plan in 2019, but I fear that the impact of outsourcing is going to be felt on a very large area. You see, outsourcing growth is through the roof and it is growing in a sphere of influence that has not been seen before. Fintech, Meditech, Pharmaceutics. It seems like the golden calf, yet it is a treacherous field. It might be a temporary field at best. I think that the construction companies have good weather now, yet the crash of the 80’s is still with them, Communications is all about outsourcing, yet when those outsourcers do not finance the training of staff, their usefulness will decline in 3-4 years as the companies are focussing on 5G. In that same light, we see a pharmaceutical growth, yet the setting is that many patents will fall over in the next 5 years. At that point these companies outsourcing can discontinue the renewal of contracts and the staff issue will not be their problem, it will be the problem of the outsourced company and that is starting to push a wave to a much larger degree than we have seen before.

So as we return to the Financial Times article we get “Interserve said profit growth for the year so far had been as expected, and it anticipated “a significant operating profit improvement” for the full year. The group, which swung to a loss in the half-year, did not provide figures“, we knew that, many sources had it. Yet we also get “It has revenues of £3.25bn but is valued by the stock market at just £75m and is already under close watch by the British government in case of collapse“, when a 3 billion revenue company is merely valued at merely 2% of that, there is a lot more going on than mere sneaky keeping of books and that needs to be seen as well. So when we consider: “Interserve’s update attempted to “sugar coat” the increase in net debt and “to deflect from the news” that the Cabinet Office is making sure it has alternative suppliers to take the place of Interserve should it fail. “The operational developments are not good reading either,” he added“, a part given to us by the independent analyst Stephen Rawlinson, we need to look deeper. You see, if the UK does get confronted with: “alternative suppliers“, we need to accept that for a chunk of those 25,000 British workers it will not spell good news, even more so, there is every chance that it gives a larger level of turmoil to those people whilst some board members end up going home with a payout that is between £380K and £2.25M, making sure that they can live in a sea of porn and Netflix for the longest of times, possibly even until the day they die.

Is it that bad?

Well, that is not certain, yet the issue that the UK accounting watchdog had to quit over criticism regarding Carillion (source: the Guardian), they give us the quote: “Stephen Haddrill will depart after nine years in charge of the Financial Reporting Council, which is subject to multiple inquiries into its effectiveness and independence” we get one thought, yet in light of “a committee of MPs described the FRC as “chronically passive” in an excoriating report into the construction group’s failure, condemning the regulator as “too timid to make effective use of the powers they have”” we should consider that there is every chance that Interserve might have been on that same side of the page making the issue larger and more critical. Is it not interesting that too often we see terms like ‘too timid‘ when it comes to dealing with the rich? The entire Sir Philip Green’s £1 sale of BHS is a nice example to keep in mind. The setting where the people behind BHS are apparently not in prison in a stage where “the settlement will not fully restore the retirement income they had been promised by BHS” (source: Financial Times). One of many failings where we see the creativity of applied accountancy and the improper use of non-committal prison sentences to those employing these fast and loose solutions. At present there is a speculative chance that Interserve might be on a similar track, but that is pure speculation, we will not know until the solution is offered, which according to the papers will not happen until somewhere in 2019, until that point arrives thousands of employees at Interserve will likely be in a state of stress. It is one hell of a way to approach Christmas.

Humbug!

 

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