How I Will Update My Wiki and Blog

I have been hemming and hawing on how to update my wiki and blog at the same time. So the approach I have chosen is to write the blog entry, and then reference the wiki with the updated content.

The problem is that if you are following my blog you don’t want to re-read the article to figure out what is new. And I do want to integrate the content, and change the wiki. Thus the blog will have the sound bite, but the wiki will have the entire picture. So if you miss some blog entries you don’t need to read everything, you just need to read the wiki.

STOP THE PRESSES!!! Greek Deficit is 40% of Budget…

I have a habit of looking at the budgets of countries to understand whether or not the country is doing its thing properly.

Well I just looked at the Greek budget and what I saw scared the holy crap out of me. And anybody who buys Greek bonds is asking to have their money taken away from them. I say you buying a Greek bond is FOOL!

Take a look at the following link:

Then look at page 19:

I see Tax Revenues of 91 billion, with a grand total of about 102 billion. What scares the crap out of me are the borrowing lines; 38 billion and 6 billion. In other words 44 billion of the revenue is from borrowing money. If somebody wants to say I am reading this wrong, PLEASE TELL ME. But as I read this it means 44 billion of the 102 billion revenue is money that needs to be paid back eventually. In other words Greece is borrowing 40% of budget!

I say WTF!

For comparison look at the Canadian 2009 budget. The Canadian budget has a maximum borrowing of around 10%. That is ok, and sustainable.

Updated My Greece Outlook

I updated my Greece outlook to include some views of the sovereign debt yield curve.

The New Approach Of Happy As A Hippo

I have a new wiki. And instead of posting to a blog I will be posting to a wiki. My idea is that I want to generate linear content from non-linear thoughts. I guess a sort of mixture between twitter, blogging and writing down my thoughts.

The wiki has a separate feed that will post each and every change that is made on the wiki. If you want to be aware of any instant changes then subscribe to it (feed). However, it might not be that interesting for you. When I have major content finished I will post on it on this main feed and reference the wiki.

Why the wiki? Instead of having all this blog content everywhere. I want to organize it for later reference. And I want to update my thoughts when things are out of date. I noticed in the searches that content would be reference that is out of date. And going back in a blog would be not such a good idea.

Where This Blog Will Be Going…

Because I have signed off at Investor Geeks I am going to put more focus into HappyAsAHippo. I have been asking my readers on what I should do, and what I should write about. The results were quite uniform, and they said the following:

1. What is going to happen next? Please help me understand.
2. How do I deal with my portfolio on a long term basis?

Everybody said this, and I mean everybody. I managed to talk to a good long term friend of mine who said to me why not talk about the discussion between somebody who works in the industry and somebody who doesn’t?

These days what you have are professionals talking to retail as if they are clueless. Cramer for good or bad does try to make the retail trader knowledgeable. Whereas shows like Fast Money are talking to retail traders and trying to make them into professional wannabe’s.

When I talked to my friend I said to him that I understood how difficult his situation is. He has to manage his portfolio without being able to watch it on a daily basis. It is not that he does not want to, but as he puts it, he has a day job.

Whereas I am sitting in my office cranking out quant code with a Bloomberg terminal in hand. I can watch the market tick by tick because I am paid to watch the market tick by tick.

So the idea is that we want to have discussion between Main Street and Wall Street. I am even thinking of getting my readers involved in the discussion. An idea that crosses my mind is to allow readers to question and discuss with us their needs and their situations. This would all be done on an audio basis.

With respect to the blog I think I am going to take a structured analysis approach. I noticed in my log entries that the very structured and focus blog entries seem to be quite well. They also seem to be timeless.

I am think that this could be a dossier approach, where the blog would simply be an update to the reference of the article. Of course every now and then I would post simple commentaries, but structure seems to be the name of the game.

Read My Lips: Greece Will Most Likely Default!

I find it funny how the market is repricing that the EU will support Greece. The EU might support Greece, but not with Germany’s money. Without any cuts there is NO WAY, and I really do mean NO WAY that Germany will provide money for Greece. I was talking to some Germans in Germany and they said, “Give me a break with Greece. They think they can get away with it [no cuts, no changes]. I want Greece out of the Euro, they don’t deserve it.”

The EU is kicking the can down the road because I think they are battening down the hatches on the s**t storm that is going to result. I think the various Euro countries are getting ready to isolate themselves from the market. I also think that the Euro countries are happy that their currency is weakening. They can export more.

For reference here are the list of countries that are telling Greece to save more, and more. Sweden, Austria, Germany, Euro Group leader and the prime minister of Luxembourg, Finland has already said it is not helping. So who is left? Or let me rephrase this, who is left that has the money to help? Answer NOBODY!

Simply put Greece will most likely default… And the Euroland will sigh with relief…

Is Goldman’s Going Down?

I have been following this Greece situation quite closely and today I read something that is making me think of what the next potential step may be.

EU spokesman Amadeu Altafaj Tardio says the EU executive has given Greece an end-of-February deadline to give details on how deals called currency swaps affected government accounts since 2001.

He said such swaps weren’t illegal unless the Greece was not using market rates to calculate the exchange rate.

What I find interesting is that they seem to be focusing on the swap exchange rate, and the fact that fudging it is illegal. Let’s say that it was fudged and illegal? Greece will get a stiff talking to. But I am willing to bet the stiffer action will be against Goldman’s. And right now Goldman’s with its “God’s Work” comment, high bonuses, and the betting against the sub-prime would get YET ANOTHER thorn in its side.

What should make Goldman’s nervous is that if the Euro zone does go after them they better start getting out a big fact pocket book and start writing cheques. Or they will be barred from the Eurozone. And they will get a stigma of the Caribbean islands. Goldman’s has some bright people doing interesting things, but it appears to me that their management is dumb as straw!

But I am not the only one asking these questions. From Elitetrader I saw the following:

We now learn – from Der Spiegel last week and today’s NYT – that Goldman Sachs has not only helped or encouraged some European governments to hide a large part of their debts, but it also endeavoured to do so for Greece as recently as last November.  These actions are fundamentally destabilizing to the global financial system, as they undermine: the eurozone area; all attempts to bring greater transparency to government accounting; and the most basic principles that underlie well-functioning markets.  When the data are all lies, the outcomes are all bad – see the subprime mortgage crisis for further detail.

So I ask is Goldman’s going down?

I Think Greece Will Default, But The Euro Will Survive Nicely!

Many of you might be thinking, “Christian are you off your rocker… If Greece goes under the Euro zone will go under…” I say, no, it will in fact strengthen the Euro zone because a precedent has been set. Namely that the Eurozone must clean up its act and balance its budgets.

The Greek prime minister is doing best what politicians of Greece have been doing all along, namely avoiding the issue. Here is the problem Greece said that they are cutting wages by 20%. Yet is that an answer? That is a knee jerk reaction that is not serious. I mean after all what do you think is going to happen to the country? Do you really think anything is going to function?

I actually think that this is a ploy because the real measures that could work like increasing the pension age is only being done by two years from 61 to 63. What surprised me with that number is that why is Greece so low?

The Eurozone is taking a hard line against Greece because Greece cheated. I remember when the countries had to prove that they could join the Euro, everybody was surprised that Greece made it. And guess what it, seems financial engineering helped here.

According to Eurointelligence’s translation of Der Spiegel’s story: ‘Greece’s debt managers agreed a huge deal with the savvy bankers of US investment bank Goldman Sachs at the start of 2002. The deal involved so-called cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period — to be exchanged back into the original currencies at a later date.’

…

‘But in the Greek case the US bankers devised a special kind of swap with fictional exchange rates. That enabled Greece to receive a far higher sum than  the actual euro market value of 10 billion dollars or yen. In that way Goldman Sachs secretly arranged additional credit of up to $1 billion [£642m] for the Greeks.’

Greece has not been honest and the individual eurozone members are not pleased, but they will not say this publically. It also does not help when Greece tries to go around the world to yet again circumvent the rules and tries to sell debt to other countries namely like China. Remember it is up to Greece to live up to its responsibilities.

I am starting to put the pieces together and I am thinking the EU is about to let Greece drop out of the Euro. I think they will pick up the pieces of default with respect to the Euro, but nothing else. Greece will try to retaliate with words, and will probably try to jump out of the union, but Greece will in the end default and probably be the first country to exit the union.

Though I am guessing with respect to the other countries the ECB will be kinder. And the fact that the Euro will fall will only make it simpler for Euro countries to export. In other words there is NO REASON WHATSOEVER for the Euro countries to show too much support for Greece.

I challenge the reader to name me one logical economical reason on why the Eurozone should show support for Greece. And please DON’T use emotions. Use economic reasoning…

The Google Super Bowl Ad SUCKS and Factually Incorrect!

I suppose I have been too long in Europe, but the Google Superbowl ad just sucks! The first time I watched it I stopped. Then I read what it was about, and it sucked again… It is a dumb story! I suppose this is due to the fact that I live in Europe and the story is so cliche that it is not even interesting anymore.

But the ad is in fact factually incorrect!

Namely…  If this person were indeed traveling to France, and indeed putting in his search requests they would have french references!

What am I talking about?

One of the annoying features of google search is that when you are in the local country the search defaults to the local country and the language. Even if you switch languages you get the results and hints to the local country. This tends to make sense since most people are interested in searching for things around them. Though I get annoyed because most of my searches if I use Google are non-local.

Another factual issue is that when he types in “translate tu es tres mignon” he has the apostrophe as he is typing. Notice I don’t since I don’t have a French keyboard. I have a Swiss german keyboard with Canadian English bindings. Thus it brings back my point. If he has access to the French keyboard then he would be in France and be referencing Google France.

Why am I being picky? Because I expected more from Google! I expected more because I thought they were geeks…

BTW I thought the monster.com add with the mounted moose hilarious, and the Doritos underdog ad was not bad.

Dick Brass: Microsoft’s Creative Destruction

Many of you know that while I use Microsoft’s products I am very critical of the management. Especially when news on Windows Mobile 7 come out that makes the Microsoft mobile OS seem like an iPhone.

Later this month, Microsoft will most likely unveil Windows Mobile 7 Windows Phone 7 at the Mobile World Congress. Rumours abound, and the latest set of rumours paint a rather dramatic turnaround for Microsoft’s mobile platform – no more multitasking, application distribution limited to official channels, and a whole lot more.

What I truly wonder is who the f**k made this decision? I mean really, 3 and a half years later some manager comes out with the decision to make their operating system look, and behave like iPhone? If this turns out to be true, this is not only lame, but grounds for firing! I said it back then, and will say it again. Microsoft should have chucked their mobile OS department quite a while ago.

But hey what do I know about Microsoft, after all somebody who was in Microsoft was just as scathing.

Microsoft has become a clumsy, uncompetitive innovator. Its products are lampooned, often unfairly but sometimes with good reason. Its image has never recovered from the antitrust prosecution of the 1990s. Its marketing has been inept for years; remember the 2008 ad in which Bill Gates was somehow persuaded to literally wiggle his behind at the camera?

While Apple continues to gain market share in many products, Microsoft has lost share in Web browsers, high-end laptops and smartphones. Despite billions in investment, its Xbox line is still at best an equal contender in the game console business. It first ignored and then stumbled in personal music players until that business was locked up by Apple.

Microsoft’s huge profits — $6.7 billion for the past quarter — come almost entirely from Windows and Office programs first developed decades ago. Like G.M. with its trucks and S.U.V.’s, Microsoft can’t count on these venerable products to sustain it forever. Perhaps worst of all, Microsoft is no longer considered the cool or cutting-edge place to work. There has been a steady exit of its best and brightest.

When I wrote my scathing set of articles of Microsoft it is that reliance on the past that concerns me the most. I would add another aspect to what happened since the 90’s. Nobody is scared of Microsoft! People laugh about Microsoft.

Take for example the tablet. Microsoft pioneered, but I am going to guess Apple will dominate it. What happened? Simple, Microsoft never made the Tablet PC unique. While Windows 7 and the tablet is pretty cool, there are still way too many apps that simply do not work with the Tablet PC. These apps are geared towards being used as regular PC applications.

In essence what has happened is that Microsoft has not forced their market to grow.

Apple is pretty clever that way. Apple by cutting off old platforms forces people to upgrade. We always hear that if Microsoft stops backward compatibility then it would be a death blow to Microsoft. I disagree because look at what Apple did, and it only enhanced their bottom line.

I had a long talk with an analyst and what he told me is that Apple takes a few problems and solves them very very well. Whereas other tech companies present technology and say, “hey you can solve problems with this right?”

Back to Dick Brass, what was Microsoft’s answer?

At the highest level, we think about innovation in relation to its ability to have a positive impact in the world. For Microsoft, it is not sufficient to simply have a good idea, or a great idea, or even a cool idea. We measure our work by its broad impact.

I say this sums up the problem of Microsoft in a nutshell. Instead of saying, “hey we help as many people solve as many problems”, they give a speech like Sheldon on “The Big Bang Theory.”

But Microsoft really misses Dick’s point as follows:

Now, you could argue that this should have happened faster. And sometimes it does. But for a company whose products touch vast numbers of people, what matters is innovation at scale, not just innovation at speed. And in response to Dick’s comment about Tablets and Office, I’ll simply point to this product called OneNote that was essentially created for the Tablet and is a key part of Office today.

The real issue is not to develop a custom app that can only be used on a single platform. But to make the other applications like Word, Excel, and Powerpoint behave like OneNote! For example, do you really thing Apple is going to release their Office suite (iWork) for the iPad as Office suite for the iPad plus an application suited for the iPad? No Apple is going to totally re-engineer their application so it works very very well for the iPad. Microsoft if you are reading this, this was Dick’s point! And you only just proved his point.

The iWork productivity applications that people know and love on the Mac — Keynote, Pages, and Numbers — have been completely redesigned for iPad. So you can create incredible presentations, word processing documents, and spreadsheets by touching words and images on the large Multi-Touch screen. Each of these apps has been designed specifically for iPad, with all-new features. So while they’re easy to use, they’re also the most powerful productivity apps ever built for a mobile device.

–http://www.apple.com/ipad/app-store/

I will say it again, to make Microsoft work, fire Steve Ballmer and anybody who has been at the company longer than 5 years!