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Dubai expose : Lessons still not learned

Saturday, November 28th, 2009 at 6:19 pm  
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$60 billion. That is a drop in the bucket as compared to the $10 trillion we have. Yet the doom of Dubai, seemed to have echoed around that world and got the markets panicking. What we can tell you is that we have not learned our lessons yet and this demonstrates the power house economy that US really is.

$60 billion. That is more than you and I would ever make in our lifetimes. But as a corporation, it really is not that much. Microsoft is worth more than $200 billion, Apple are Google, each, are worth more than $150 billion; so how is it that a city state that owes the world $60 billion could shake the world like it did?

The answer : silly risk taking. What caused creditors to be so afraid was that lots of the debts that we see today would be increased many times over due to the manipulation of risk. Let me give you a very much simplified example.

Lets say Company A had some formula to turn water to Gold. Company A goes to Bank A to get a loan, and Bank A approved a loan of $10 million. Bank B does not believe that Company A’s plan. So it does something called a Credit Default Swap. They would give Bank A the money for the loan. Should Company A default on her payments to Bank A, Bank A would pay Bank B $100 million.

The example that I gave above is what I call a 10:1 (100 million to 10 million) bet scenario. There are other examples in real life with methods ranging from short selling to derivatives which have a 30 : 1 bet ratio. Now that is what the EU terms as casino banking.

The same thing happened with Dubai. Should Dubai not be able to pay her debts off, the amount lost by her creditors would not be $60 billion, but in the trillions. That is what the entire pandemonium and panic is all about.

When are we going to learn our lessons? Why can’t we go back to the tried and tested system of a bank putting in capital should they believe in the business plan that they receive. Why must there be what I call sucker capitalism? When are we going to end such practices? Would the next attack be too late to save America? America and the world must wake up to this problem or we would face lots of problems in the future.

Dubai goes $60 billion in the red, and the world panics. Does anybody realize that the world is not that bothered with the trillions of dollars worth of debt when it came to the debt of countries like US, Japan and the UK? This is because the world, as of today, is still very confident in these economies.

I really hope that Dubai bring back the attention of bad banking, as what the economic crash did. It is essential that we get this back in order…

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Net Neutrality : Hell Yeah!

Saturday, October 24th, 2009 at 7:59 am  
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Senator John McCain is coming up with a bill called the Internet Freedom Act. It is something that I vehemently oppose. This is one bill that could affect us right away. The Internet should not be the playground of the corporations, it should be the network of knowledge!

The Internet Freedom Act is actually a block measure intended for the Federal Communications Commission (FCC) who are trying to formulate net neutrality guidelines. What is net neutrality? What it means is that there would be regulations in Internet Service Providers to allow, slow down or outright ban sites for their customers. In simple terms, it means that you can surf to any site that you like if you pay your Internet bills and your ISPs cannot slow down your service.

E.g. Lets say Verizon suddenly hates Slashing Tongue and have become our bitter rivals (so untrue, would never happen). Based on that grudge, they can ban our site outright and Verizon customers would not be able to come to our site. Another thing they could do is to slow down access to our site, so even though you have a 100 Mbs broadband, you would be only surfing 10kbs when visiting our site but would be able to surf up to 100Mbs on other “Verizon-friendly” sites.. With net neutrality, Verizon would be forced to allow her customers to visit our site at 100Mbs. It is as simple as that!

Think about this. What would happen if a mega company like Google, or Microsoft buys over ISPs, and ban all from visiting non Yahoo or make the Internet inaccessible to Linux users? What if AOL Time Warner bans all news but CNN online? Would it be so free market then?

The free market is the free market. If the FCC is going to socialize all the ISPs under state control and make it assets of the state, then we would have a problem. That is not making the market free. Just in the same manner, it is also not part of the free market if the ISPs can slow down our Internet connection for visiting sites that they do not like. That is simple too much!

This is yet another thing that should be a no brainer but politics can screw anything up. Anybody that has Internet at home or in the office can understand what this bill is about. Can you imagine how frustrating it would surfing for knowledge when many sites are banned?. What if political agendas take over ISPs and we can only get liberal/conservative views online? What do you think the outcome of that would be? We already have that in television stations like FOX and MSNBC.

Lastly, I would say that my respect for Senator McCain is still there. Even though he has come up in negative light in the last two articles, I still think he would have been a better President than Senator Hillary Clinton should she have won the nomination. I think is stance on the Rape bill was outright disgraceful, and he is very wrong on this bill, but I think that his heart is at the right place.

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Obama and FOX News

Friday, October 9th, 2009 at 7:45 am  
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Duh! The President and his administration is definitely right when he says that and has a right to “fact-check whatever the President says. This is something that we have been saying all along! But what the President forgets is that there is also MSNBC that worships his every word.

I really do not see any defense for FOX News when it comes to this. When you can have nuts like Sean Hannity and Glenn Beck, you cannot claim to be “fair and balanced”. When they have producers that are trying to rally up crowd gathered by their own anchor, how can FOX claim to be a news organization? How can they be considered sensible when they think that Google is biased towards liberals and is left leaning? Google?!

“Fair and balanced is just a catchphrase and is not in any way accurate about FOX News. It is like tourism brochures that claim “kingdom of wonder” or fast-food outlets claiming that they are “finger licking good”. It is just sale-pitch, not reality.

Our take on it though is that the President is not being fair to the network. This is because, it is not just FOX news, but the news cycle itself that is becoming nothing more than opinion journalism. Far left MSNBC is basically the left wing version of FOX News with only left wing punditry. CNN leads the rest of the cohorts with left vs right wing punditry on their shows. They also tend to have mellow hosts like Anderson Cooper and Campbell Brown.

All of the above mentioned companies are not really supplying news. The real supplier of news are agencies like the Associated Press, Reuters and Agence France-Press (AFP). But lets be honest, how many people watch or read their news? CSPAN is definitely the best political channel in America, but don’t we snooze when we watch it.

It is we, the consumer, that should be blamed. It is no secret that FOX News has the highest ratings amongst the news channels. Why? It is because we Americans, Conservative, Liberal or independent would prefer to watch Jay Leno and the NFL rather than to watch news. Additionally, the people that want to watch the news are from the far right. Hence, FOX news dominance.

The nuts are real, have no doubt about that. Glenn Beck, Sean Hannity, Keith Olbermann, Rachael Maddow etc… But at the end of the day, it is all about the numbers. And WE make the numbers. FOX is just following a strategy that makes them more money.

The other point that I want to make is the hypocrisy of President Obama. MSNBC did this for the last 8 years. Did he complain? MSNBC “carried his balls” throughout his Presidential campaign. Did he complain then? MSNBC is openly skewered to the left. Does he complain? No! He has said nothing about them.

I also think that he should have taken the approach that Michael Moore took. He should have gone on a show that hates him the most, like Sean Hannity’s show and bitch-slapped them. He should have done things Slashing Tongue style and tell FOX News off during their show in their face. But he did not do that when he should have.

At the end of the day, I want people to understand the effect of what we are doing. We “stupify” debates when we take our news from comedians like Letterman rather than Katie Couric. We are buying crazy talk when we listen to people like Rush Limbaugh.

To be brutally honest, that was why this set was set up. And we hope that we are providing a better alternative in text than these guys are providing!

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