What is News Worthy

  • Malone's Magic shines on Pandora!
  • .
  • Can MSNBC shake the Liberal media under Comcast and take over?
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  • Not another investigation!
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  • Did May deal a good hand to Merkel?
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  • Bill Gross: without German Umbrella just another Economist trying to get attention?
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  • Qatar and $12B in orders after Saudi Mega deals in Defense Spend: A new business Model?

Re-inventing America!

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Silicon Valley Vibes!

  • Elon Musk Line: Car mover underground in Hollywood!
  • .
  • Would you allow Siri to drive you around?
  • .
  • Google Ventures : the hidden gold mine? From curing death to scissoring and splicing genes?
  • .
  • GS Warriors : Is Oakland ready to be part of High Tech bubble?
  • .
  • Did Ford Make a big mistake by changing their tradional CEO?
  • .
  • Killing Uber Management: Is it a Mistake which will burst the bubble?

FANG News:

  • What ever happened to House of Cards: Its not even 7 seasons
  • .
  • Mother of all AI? Lets Fix SIRI before leaping too high!
  • .
  • Under steady Republican policies - will American Advertising spend go down?
  • .
  • If Waymo is $70 Billion should Uber be $200B?

Saturday, August 18, 2007

My 2 Cents on how to risk your 2 cents!

Purpose: to assess if the current disruption in the global market is just another re-pricing of risk as the global expansion continues or it is the Real One like the 1928-29 market induced economic calamity! To see if we can really find a safe haven instrument that will protect us in either situation and see if we can be prepared to load them up when the opportunity is right!

Disclaimer: Do I drink my magic potion? NO!! I don’t - only Heineken! - as I still am controlled by those butterflies in my stomach & believe in panic & fear induced reactionary decisions and enjoy being a Monday night quarterback! A wise man once quipped when told that he should have his money work for him – “Let the money rest safely- While I do the Work!”

Am I Qualified? Heck NO!! As they say Clarity is better than Cleverness!

Set up: Global Market melt down spreading from London to NY to Tokyo to Bombay – every one trying to blame everything from US Sub-prime to CDOs & CLOs and the fanciful but less transparent Hedge funds. Indexes down in double digits- with Helicopter Ben along with his global Federal / Reserve Bank buddies dropping bags of currencies - only to see them drown in the flood of worries with no desired effect. May be it was deliberately orchestrated this way & waited long enough so that the system can flush out the bad elements and punish the not so deserving speculators so that it does not look like a bail out of the un-deserved. The unexpected move of a drop in Discount rate was timed for perfection so that it can punish those speculators who were shorting mercilessly – as speculative short sellers in the options and derivative markets using Index & Futures were burnt as the settlement price is fixed at the open on a expiry – and as it happened on an expiry day before market opened & the Index opened 2-3% higher leaving those speculators with heavy losses.


Sub-prime or no-sub prime: Unlike other economies & markets where the government agencies protect and cover all disasters for public popularity – the US market has worked out of its greed driven financial calamity by punishing those culprits with immense severity & immediate urgency- enabling the larger market & economy to bounce back and move forward. This time it is not going to be any different- speculators will be punished & a handful of individuals & entities (may be an understatement) will face severe financial penalty but the economy will be back to normal in a very short period.

Looking at the speed with which the market is readjusting to the unknown impact of the hedge fund from CDO/CLO/Sub-prime one wants to believe that this is the end of it. Volatility – globally is beyond anyone’s imagination; price fluctuations are capable of making or losing a ton of money if one’s luck is smiling for the right reason. There are enough analysts and reporters comparing this to various time lines in the past including – the great 9-11 when the market was shut down for a week, 1998 LTCM-Russia Debacle, 1994, 1991 , 1987 and even some to 1928-29 and a few other Financial events in between.

Let’s take a look at what it is being compared to-

9-11 Disaster: A combination of Telecom induced Internet bubble topped by the 9-11 disaster. Even though the tech bubble high is yet to be scaled back again there is lot of money that has been made starting shortly after that- and of course leading to the current day global dilemma!

1998 LTCM –All it took was a handful of brains and what should have been a non-event Russian default to bring the world economy to the brink of bankruptcy. Yes - there was panic and casualty but it was contained superbly by well co-coordinated global fed intervention.

1994 – Was it real estate or just the economy? May be the bank of England being disliked Either way, one has to dig deeper into the history to find that the year will be remembered for the beginning of the technology era and the great internet proliferation and definitely not an economic of financial event.

1991 – Is it war or inflation? Either way the fed over came its misjudged call in a hurry.

1987 – Talk about pain and suicide robbing the headlines from NY, NY! Fed Chairman – may not be Green (!) at that time but turned out to be one of the greatest in post world war economy- even though there are rumblings about the Greenspan Put and how he was the originator of Sub-prime & the wealth inflation to spread like cancer. May be if this event turns out to be a non-event – Mr Greenspan might still hold his reputation as the best of breed and might be forgiven for his asset bubble.

1928-29 – This is really one for the historians – No matter how much people blame it on speculation and greed by way of leverage and market manipulation one thing which is being ignored from the time period is – it was at the very early stages of modern Industrial civilization – when innovation was at the very basic level compared to what we are going through in the internet induced global era. From factory planning to material movements – everything was basic and primitive. Gold based monetary system, British imperialism still wagging its tail, war driven penalties, etc. The economy was still controlled by a few Industrial barrons or companies – starting from GMs to GEs and Du Ponts to JPMorgans of the world after the Rockefellers & Carnegies started handing over their torches. Disruptions and disasters where part of the evolutionary cycle of the modern industrial era. Lasted a while – but was not the end.

Panic of 1825 – Bank of England: take everything anybody wants to give and the crash lasted 2 days. Digging deep into the history books – whether it’s the gold or tulip mania or modern day currency / stocks / bonds era – speculation and greed has always led to newer and better financial instruments for the future generation to hide behind – only to be crumbled like a sand castle.

We could take a few more of those disruptions and I am sure we will still find same end result with differing market movers. The economic growth engine comes back with a vengeance –as the basic survival instinct leads to innovation and growth.

Does that mean doing nothing? Absolutely NO! Market indexes might scale new highs if waited long enough – but what seldom gets mentioned is that the components are not the same.

Now for the 2 cents for various expectations:

Scenario 1 - Scared of an Imminent Depression?: Go for the currency – based on conviction distribute between Yen, US $ and Indian Rs .

Why Yen: Japan is the only country which can self sustain & since their pride and feeling for independence is so strong that they will honor their currency no matter what.

Why US Dollar: US is the only sovereign nation that will honor its debt obligation no matter what & has the economic power & market strength along with product might & services with a free market capitalism that can punish the bad and reward the good immediately. This will increase the demand for US Government papers making the dollar stronger in such economic conditions (against popular sentiment). Post 9-11 and post German minded Euro-zone the predominantly US Dollar foreign reserves have been diverted to Euro along with some commodities. With the gyrations of commodity prices in a economic calamity most nations will move to safe haven instruments that is very LIQUID & will be honored – leading to a gradual strengthening of Dollar.

Why Indian Rs: India is the next stop for low cost manufacturing supply base & is the only free market (may be regulated but certainly not controlled) economy that has a very big consumer market next to US & hence will continue to grow organically before global stabilization & growth takes over. Rupee can only get stronger over time given its domestic market size & global opportunity for its base.

Gold is a no go as are other commodities & fixed assets as they will be re-priced like every other asset class as it will not be restricted to paper assets like stocks & corporate bonds. As gold is influenced by dollar value – it will go down as dollar gets stronger.

Euro is a no go – as the solidarity of the Euro Zone will be at risk and eventually crumble under lopsided benefits being reaped only by Germany while pushing the other members into unemployment, high inflation & stagnation. (maybe master minded by the Germans to eat the cake & keep it too; Details for another day! Preview: Look at the bottom line of German companies & economy & compare them to the other Euro-zone entities)

Scenario: 2

Economic Recession – restricted to the US Market – Reallocate into defensive areas, growth stocks with lot of domestic and non-US exposure & precious metals and domestic fixed assets.

Economic Recession – This time a Global One! – Defensive stocks & metals, local fixed income papers both government & corporate.

Scenario: 3

A Market Correction – may be a mild economic slow down- Average down on the previous allocation strategy that has worked for you.

Scenario - 4

Most likely scenario (OR is it My Wishful thinking?):

A mild recession with patchy global growth leading to a moderate Bear market (Bear market is 20% by most standards – which we have already achieved in many sectors/industries – may be not in the Indexes yet!). Most of the Mortgage lenders in US going under bringing down the hedge fund market along with a few brokerages globally only to be re-packaged & launched under a different name. US real estate market going into a prolonged price compression bringing down home builders & REITs and some specialty retailers. Most of the consumers will be spared as a majority of the obligations and risks are already distributed and buried under other speculative investment vehicles – the owners of which have already either been punished or will be shortly and mostly contained to a limited circle. The much anticipated slow down in retail – leading to a coal bag this Christmas will be averted for the following reasons: 1) Election around the corner in US 2) Most of the draw down from the housing market appreciation was used either for home upgrades or further investments in housing related expenditures 3) retail was always supported by strong labor market & wage increase and not from the real estate bubble as widely mis-understood – and hence will still be in tact even after the real estate bubble burst 4) with a possible change of guard in Washington – a new breed of government sponsored expenditures in industries other than Defense & Oil will take place as the focus will be Domestic & not on War & middle East leading to more expansionary measures leading to a moderate Growth in US economy. 5) With a strong Dollar and Washington ready to tap into the strategic petroleum reserve – oil will crash down to under $25/barrel, as the speculator and War/Republican premium will be wiped out. 6) Western dominated Pharmaceutical & Biotech will lose their charms to generics as Washington fast tracks the bio-generics and has less restrictions on patent copying as the largest capitalistic market moves towards a Universal health care system.

This scenario will lead to moderate global expansion and hence – reallocate to Emerging markets – infrastructure & growth stocks along with Hospitality & Emerging market Real estate. Going short on Defense, Oil & Pharma.

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Slowing to Smell....!

After going through several blogs I came to the conclusion that it is very difficult to write about your day to day life!

Fascinating to see how creative people are and how so many people around the world are able to choose a variety of topic and pour their heart out and paint something so wonderful- full of life and color!

Need Humor! Need Depth and more than anything need perspective! I found it is easy to write about something substantial in which a person is well versed in. It made me think - I went around the last few days looking around and paying attention to everything from nature to relationships!

Now curiosity started posing a question - what is more important to writing? Chosing a topic or having the patience to research and articulate about the impressions that every day events brings to a person?

I thought I will try this every day! For 30 Days!

Impulsive and spontaneous
!

No research - just type as the feelings flow and as the words can portray! Thanks to the Blackberry - now I can try doing that the moment the urge happens without waiting!

As I was deciding on this I found myself in a shop - decided to pull my Blackberry and type what I saw around me...so begins my first piece.

PS. Since Blog has major restricitons on how many posting and what kind of flexibility one can have using the standard template I will try to find a work around using a couple of gadgets to display a couple of days posting at any given time till I figure out a way to display the history!

To avoid dilution of this site I have moved the experiment to another blog under

http://dailylifesigns.blogspot.com

The following is a sample on content with no photos- the Daily Life Signs posting will be more of a pictorial experience!






Walking around a woman's shop!

Looking at the colors in a woman's shop is like peeking into a kaleidoscope. However, one doesn't have to change to feel the vibrant mood.

Amazing styles and fascinating fashion! Trying to coordinate gives the several option that is needed to meet the day to day lifestyles of varying moods and differing ages.

Age appropriate colors! Shades for fading moods!

Bold red!

Sober red!

Flashy red!

Bland red!

Blood Red!

Romantic Red!

Decisions! Decisions! and Decisions!

Deciding the color at the time of shopping gives the option to choose and refine to the various rainbow moods that a person possibly can go through in a fast paced connected world!

Sizes and fits to match every form and need.

Having a choice helps in refinement!

And helps!

In Decisions! Decisions and Decisions!

Startup Wisdom!

May be there is a reason they want a Money Man to run the venture- but the following tip will save a buck or two! This will list a couple of grey hairs to keep!

  • Success is contageous- start it immediately!
  • Share the Vision but not Leadership!
  • Smart money is great - but Lucky Money is even better. Get some!
  • Being passionate is essential - but only after motivation to make money.
  • Establish the TRUE Pecking Order!
  • Let Sales be part of your core strategy- everything else can be bought!
  • If you havent done Selling START DOING IT NOW!

Building your 2nd Million!

Skip the first million and go straight to the second- as the first one is the most difficult one to bring home! The second one can be as tough as the first one but is never tougher than the first one! You can make money - working - investing in stocks/etc - real-estate - starting a business - others Choose your area of interest first as this will help you identify the opportunity and make you easily motivated to work on the 2nd million!

Not in any particular Order!

  • First lets know the facts: 1) Your work life is 40 something years (even at conservative estimate) so lets make sure we plan that Properly
  • 2) Lets identify opportunity to make money with out too much effort- living for Today is Good but lets not lose today's free money in the process like - benefits, tax breaks, sale,coupons,etc
  • 3) Lets not try to make ALL THE MONEY in the same way! Lets break the objective into smaller chunks and assign different ways to make them individually
  • 4) Put the 1st Million in Auto-pilot and set a 10 Years plus Time table
  • Convince yourself that you need the Money
  • Set a time line to achieve the goal.

Relationships - Learning to enjoy them!

Do we retain relationships? Expectations out of frienships vary from society to society & age group to age group. How long do we carry them? Some of them bring fond memories- and some not so pleasant! Here you can expect to see nuggets from my experiences and analysis!

Family & Friends: We spend less time with family than with friends- yet we feel more comfortable with family than friends- Why? Is it because we dont have expectations with family members but we have some on friends?

Allowing the other person to finish their train of thought builds a very long lasting relationship - as it makes you understand the other persons point of view fully & also to respond being aware making even an opposing point of view reasonable.


  • Cherry Pick your arguments - Left or Right Brained!
  • Make every encounter a transaction - this will make leaving baggages behind easy!
  • Qualify the type of relationship - however strange it might be
  • Chasing friendship is not always helpful as it leads to compromise.
  • Family circles - define it and accept it whether you like it or not!
  • Its ok to do different activities with different people!
Prof Dr Peik A Monie's Corner

  • if being number two is not enough go to a lower market
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  • proceeds from a street dog dont bark
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  • shooting the papparazi dont break cameras

DIGITAL IRIS - An inexcusable view of the photograpic world!

Let me see if I can add a few lines every week highlighting my 2 cents on photography- my experiences and desires

Things that make good photos -

- excellent and expensive set of lenses; in this digital era spend less on the body and keep investing in the high end lenses as the lenses will not lose value and the body is still under construction!

- accessories and the right tripod; never underestimate your advantage with a tripod

- plan & choose the subject and the location

- know your subject well!

- look and follow the calendars; simple things like a night with a Full moon- we dont realise that it does not happen every day - if you narrow it to the summer when the sky is still blue - I guess it becomes a couple of times a year- and if you factor n the location and your availability at that location and time...so Knowing the calendar and season helps for a good but not so common picture

- Take some luck with you!

  • Print and Enlarge Some Too
  • Delete Bad Pictures from Storage
  • Isolate Subject's color
  • Assess various profile
  • Add a subject to the frame
  • Take Nature after rain - they look better
  • Transparent Objects like flowers have creative effect with light behind them
  • If you want to enjoy the trip - leave the camera behind!
  • Define the subject for the shoot out trip
  • Take a survey trip before the real shoot out
  • Learn & Buy the Best Tripod
  • Always take a handy utility camera
  • Use Multiple exposure & shots in action oriented moments- this will help you pick the ideal snap - as even a fraction of a second makes a HUGE difference in photos.
  • Know your camers settings!
  • Understand Shutter Lag
  • Understand the camera shakes

AfterMarket Pulse- The boring Services Industry!

Keeping it inefficient is good for every one- A success story and why it will be restricted to a handful in the services Industry- A serious look at the Service Industry and my views on improving them. As a society we have accepted that everything breaks down and needs periodic maintenance. We are willing to pay both money and time to accomodate such services. What we have not done is define what is the service level that is needed for every such incident. From household appliances to industrial equipments we are forced to accept the cost and quality that the market offers. In such a sellers market room for mediocracy is enormous- giving way for opportunities. Yes predicatability is not always easy when it comes to failure or repair - or for that matter to identify what is wrong once the item is broke as it is not always possible to run the equipment ot see what is going wrong! And there are companies that can afford stupidity & those that cannot- if you want to change choose wisely!

  • Three steps: 1) Localize Failure 2) Response to Events 3) Time to Life
  • Inter-dependency at a higer level accelerates return
  • Resposiveness is rewarding - even if it is just to show on site of event!
  • Failure Prevention is difficult - yet possible
  • Know your Industry problems: Inventory, Turn time, Forecasting Failure, Estimating Cost, Finding Talent, Automation tools
  • Know your industry Practices- Swapping parts, using refurbished items, penalty
  • Define Quality of service
  • Attract talent - as service industry does not attract fresh talents
  • Innovote service packages

About Me

Seen me go through cycles driven by Age, Money, Deception, Affection, Success, Failure, Fear- etc. The current cycle puts me in a middle aged bucket with sculpted bitterness trying to tame it to embrace the sweet crime of success and affection.