The Power Of Web 2.0 – And the Myth of Google and FaceBook

The more time i spend delving into all that is web 2.0 and the more closer we get to the Launch of the the Brain Make Over Beta Site, the more perplexed i become by certain factors.

Firstly, we live in an age where Google (goog) is quoted at some $681 at time of writing which gives the company a valuation of approximately $213Bn. This is for a company that if my memory serves me correctly has about $11Bn of revenue and $4Bn profit.
Do I use google every day, resoundingly YES,
Do i think that Google has a fantastic search algorithm, again YES,
Do i believe that the company is worth 20 times its revenue and more than 50 times its profit, one second, did i just say 50 times their profit…something must be wrong with my calculator, maybe i have time warped back to 1999 and we are pre millennium and euphoric with Greenspans low interest rates!!!

Do you guys that own google stock realise that even if Google gets the 700mhz cycle and enters the cell phone market and even if they build solar plants and land a man on Mars, the potential earnings growth for the next decade has already been accounted for …. so here is my question…… Larry Page, Sergey Brin and Eric Schmidt are all bright and talented boys….so why do they own stock. If i was them, which obviously i am not, I would sell my stock and by someone like Microsoft who has a market cap of about 30% more 307Bn but has over $12Bn in profits on $50Bn+ of revenues. Lets throw in that this company fits the dynamics of both a Growth and an Income stock.

The second question is that of FaceBook, again valued at somewhere in the $10-15Bn range with revenue of less than $300m. This is another disruptive technology (I believe it is disrupting email as a more fluid and fulfilling interaction if i am to understand the hype correctly.) Like Skype this is all great but where is the revenue stream, the market is captive (which means they will surely leave given enough time) and it really serves little or no useful purpose!!! Did i just say that out loud, blasphemy. But in reality, there is a novelty in finding people i had long forgotten about and would have had no way of getting in touch with. However did i really want too, will i be able to strike up a stirring friendship and get something meaningful outr of the relationship.

So they counteracted this with a genius like devilishly cunning move (similar to the Fed increasing the Discount window to save the banks in August) of creating applications and opening up their platform. But Google copied the rapidly with a far larger network and there is still that huge issue of stick ability! Does anyone really stay on the site that long. You want to check what you friends are doing now, ok cool, i am gone see ya!!!!

So where does this all leave us, Web 2.0 the new internet will in my opinion soon cede itself to Web 3.0 which for me is interactive application based internet usage. whilst currently available i am talking about the web as a medium for absolute harmonization and integration of all facets of life…….. Big, Bold and Brash maybe ….. or some would already say we are there ……. I will continue further when i explain the concept of Brain Make Over within the next month, so hold that thought.

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Credit Cards and American Consumer Debt

Household debt has now exceeded the national debt of the USA – what does this mean, this means that the people who live in America, you and me, owe more money to companies (particularly banks) than the entire government does to other countries!!!!

This figure is incredible but how has debt spiralled so far out of control. The average American family owes more than $16,000 on credit cards, many only making minimum payments. With some credit cards charging exorbitant “loan shark” style interest of 39%, late payment fees, partial payment fees etc etc credit card companies are able to double their money annually! This is quite possibly the most rewarding part of thew whole financial system for banks. The majority of hedge funds do not produce mid to high double digit returns – for mainline banks this is a n incredible pipeline that they will continue to milk until America wakes up.

Minimum payments (around 4% on average) will require 15 or more years to pay off if no further charges are made to the card. This is with a more normal 19.98% apr.

With the Universal Default Clause your credit card company can change your interest at any time for almost any reason, your debt is too high with another company, you were late on your mortgage payment etc etc. This is one of the scariest and most open ended, open to abuse clauses in the American legal system as it exposes more than 1 billion card holders, yep 300
million Americans with an average of 3 cards each, to the whim of the card company. Should you choose to retaliate in any fashion they deem unfit to this injustice, there goes your FICO score.

Meanwhile whilst on the topic of FICO scores, this number has become more critical than ever before as now it holds the key to how high your charges on your mortgage will be. Fannie May et al will be charging higher fees and possibly require higher down payments from “sub prime” borrowers. This means anyone with a 680 or less is going to be dinged – i believe on a sliding scale.

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Is your VOIP call being recorded

It has been generally well known and accepted for years now that our governments listen in on our phone calls, triggered by certain keywords. It used to be the the British tapped the American public and vice versa, until the patriot act pretty much allowed the US government a free hand.

It is now emerging that it would be possible to tap VOIP calls and you can bet your bottom dollar that if the government isn’t already doing this they will be soon!

As mentioned in the article this will also be a potential boon for those criminally minded as well.

So remember, when talking on “ANY” type of phone – be careful what you say, someone may be listening!

To hear what they have been doing as a proof of concept on this have a look and listen at the following website http://siptap.voipcode.org/

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

We have survived the Cold War and Nuclear threat, but will we survive the Gray Bomb, the most dangerous threat to the USA

The world stands at the edge of a cataclysmic financial abyss, and no i am not talking about the current housing and liquidity crisis, i am talking of something a little further away and somewhat grayer (excuse the pun). Although the drop to 12800 is 1200 off the high, nearly 10% as i predicted back in August (month off due too Bernankes pointless meddling)

The financial and social timebomb is the graying population of the industrialized world. I have coined the phrase the “Gray Bomb” to categorize this impending threat.

We live longer, live better, consume more and expend more. If you sit down and read the social security/ welfare document sent each year to every tax paying American, you will also see that the US welfare system is budgeting to run out of money within the next 20-30 years!

Yes

You heard me

Thats correct, they “admit” quite openly that their coffers will have run dry and they will not be able to provide for anyone properly after that time, without a drastic increase in taxes (probably to a scandanavian style 60+%) Why is this, because the Baby Boomer’s will mature, the first of them passed 59 1/2 in 2005 and thus over the next 10-15 years there will be more people claiming social security pensions than people working and paying into the system, creating an insurmountable deficit.

What do i propose or advocate as a solution, don’t just throw stones i hear you cry, give us a solution! I hope to provide suggestions that will spark open debate and could ultimately lead to some kind of resolution.

So lets try this, Romania “i believe” recently told its populace they would not be paying for their retirement, people had to plan for it themselves! I think that the social security system is somewhat archaic and grotesquely mismanaged and rather that continue it, make everyone more that 25 years out responsible for their own retirements!!! These people must take financial responsibility and accountability now and start saving.

Several things that need to happen to help society survive;

The government find ways to become more financially efficient and stop or even reverse inflation.

reduce dependency on oil as it is a finite supply and prices will continue to rise even on the exaggeration on the speed of reduction of this decreasing supply. Like Diamonds, it isnt as scarce as prices would indicate, but neither is its supply going to last out our lifetimes!

My solution will have several consequences, many of which i think are inevitable either way, that will be interesting;

The first being that as a collective generation, those that come after the baby boomers will probably be poorer than their parents!

The second that property values will fall significantly as more housing stock is returned to the open market with less inhabitants!

Immigration will increase from countries such as China and India that will become overly populous and lower more affordable prices will draw people in. These countries will ultimately come to resemble Japan and Tokyo in terms of density and expense.

Our generation will have significantly fewer children than our parents as we will simply not be able to afford them.

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

World Shift

The world stands at the edge of a cataclysmic financial abyss, and no i am not talking about the current housing and liquidity crisis, i am talking of something a little further away and somewhat grayer (excuse the pun).

The financial timebomb that is the graying population of the industrialized world.

We live longer, live better, consume more and expend more. If you sit down and read the social security/ welfare document sent each year to every tax paying american, you will also see that the US welfare system is budgeting to run out of money within the next 20-30 years!

yes

thats correct, they admit their funds will have run dry and they will not be able to provide for anyone after that time without a drastic increase in taxes (probably to a scandanavian style 60%) Why is this, because the baby boomers will mature, the first of them passed 59 1/2 in 2005 and thus over the next 10-15 years there will be more people claiming social security pensions than people working and paying into the system, creating an insurmountable deficit.

What do i propose or advocate as a solution, don’t just throw stones, give solutions, provide answers that spark debate and could ultimately lead to some kind of resolution. So lets try this, Romania “i believe” recently told its populace they would not be paying for their retirement, people had to plan for it themselves! I think that the social security system is somewhat archaic and grotesquely mismanaged and rather that continue it, make everyone more that 25 years out responsible for their own retirements!!! These people must take financial responsibility and accountability now and start saving.

Several things that need to happen to help society survive;

The government find ways to become more financially efficient and stop or even reverse inflation.

reduce dependency on oil as it is a finite supply and prices will continue to rise even on the exaggeration on the speed of reduction of this decreasing supply. Like Diamonds, it isnt as scarce as prices would indicate, but neither is its supply going to last out our lifetimes!

My solution will have several consequences, many of which i think are inevitable either way, that will be interesting;

The first being that as a collective generation, those that come after the baby boomers will probably be poorer than their parents!

The second that property values will fall significantly as more housing stock is returned to the open market with less inhabitants!

Immigration will increase from countries such as China and India that will become overly populous and lower more affordable prices will draw people in. These countries will ultimately come to resemble Japan and Tokyo in terms of density and expense.

Our generation will have significantly fewer children than our parents as we will simply not be able to afford them.

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

The Ultimate Gift

Every once in a while there comes a movie that embraces or harness the power of human goodness, lifts us to want for or strive for more and to do better. “Pay it Forwards” ” Forrest Gump” “Meet Joe Black” “God Grew Tired Of Us” are good examples of this inspiring genre. I was blessed to watch such a movie recently, “The Ultimate Gift” which incorporated and embodied so many values that I personally aspire to hold true.

If you haven’t seen the movie then don’t read on!

The 12 gifts are:

The Gift of Family
The Gift of Love
The Gift of Dreams
The Gift of Laughter
The Gift of Giving
The Gift of Friends
The Gift of Learning
The Gift of Work
The Gift of Money
The Gift of Problems
The Gift of Gratitude
The Gift of A Day

Take a little time and watch this movie, allow it to inspire you, don’t be afraid!

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Saving Plan

I was asked last week about how to save money in the current economic situation and where to invest.

My answers surprised them, as I am a staunch property supporter……… Don’t buy anything yet – the bottom isn’t even close, I returned to my old adage that when we see rents covering the mortgage payments and all associated costs and the property is entirely self cash flowing, buy, but until then look for some solid mutual fund performance (American/ Global Growth and Income funds, Franklin Templeton etc) but try holding them somewhere different. Inside a Variable Life Insurance Policy. Why…… Tax free growth, long term disability riders, easy borrowing and the immediate net worth it provides you will all come in handy when the housing market is full of bargains!

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Diamonds Are A Girls Best Friend – Or Are They

I regularly end up having conversations with people who oooh and ahhh over diamonds, possibly the best marketed commodity on the planet. People have connotations of rarity and value when they look at diamonds and one cannot but applaud DeBeers (the cartel that makes Microsoft’s anti competitive litigation with Netscape look like small children throwing rocks in the middle of a war zone) for having achieved this highly deceptive position within the precious stone marketplace.

Rubys are the rarest of the precious stones with Emerald and Sapphires close behind, Diamonds are actually one of the more common stones (resulting in DeBeers billion dollar vaults of stones) they have just been marketed well over the past century, to the point where one wouldn’t give a different stone for an engagement!

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Comment e-mailed to me

Regarding your marveling at DeBeers marketing, I have to marvel even more at the psychology inside the brain of the recipients of those diamonds (women). To them, especially the 20-30 somethings, the truest expression of the love of their fiance is to buy them something worth the down payment on a house that serves no useful purpose except that one can cut your way out of a phone booth with it if trapped inside….too bad their are no phone booths anymore thanks to cell phones ! Would the money for a diamond not be better spent on the beginnings of a retirement portfolio ?

Food for thought…..diamonds are the ultimate form of nature sequestering carbon…cant burn em to release their carbon content.

The Power Of Music

One of the biggest changes that occurred during that last century was the progression of music and its impact upon society.

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.

Diesel Vrs Hybrid Vrs Petrol Cars – The great deception

I love to hear people talking about hybrids and buying them at many thousands of extra dollars! But do these people really understand what they are doing.

a) MPG from EPA. To calculate the fuel economy of a vehicle in the US to the best of my knowledge the EPA uses a rolling road and essentially eradicated the factors of wind resistance/ aerodynamics,
vehicle weight, tire width etc. This give highly inaccurate figures. This system is reputedly being changed during 2008 to give fuel economy figures that come in line with European and Japanese testing methods. I am certain that you will see a dramatic fall in the quoted average fuel economy of all cars, but hybrid in particular! The battery weighs a lot!!!!

b) Cost of ownership. Do you know what it costs to replace the battery on a hybrid car (if you keep you car 7-8 years then lease it don’t buy it) if you are buying a used car then it is a ticking time bomb as you could end up paying as much or more than the value of the car to replace the battery.

c) Disposing of the battery. Batteries are a combination of acids, lead and other toxic material, review a short article on what it takes to dispose of batteries and how dangerous they are and you will get the idea here.

d) Diesel. Diesel engines are not what they used to be, blutech and other technologies produce engines that have significantly lower emissions than older petrol cars and also get far better fuel economy. With fewer moving parts they are a lot cheaper to maintain and have longer service intervals (this is one of the biggest revenue centers for car manufacturers so they don’t want this)

e) California. California is seem as the progressive state, yet in this arena it is archaic, by pushing hybrids harder and harder (with access to hov (high occupancy vehicle) lane and free parking downtown they have created a boon for Toyota in particular with its prius and other hybrid manufacturers.)

f) Celebrity endorsement. Celebrities have been seen turning up to all kind of event in Prius’ to show their concern for the environment! However check the license plate and you will invariably see a LCS tag which means they hired it and don’t own it!!!!

g) Alternative. Greenland has gone hydrogen, Brazil is using biodiesel. UK uses gas. Whilst these are the technology of the future American car manufacturer and oil companies have a strangle hold on the economy and political decision makers. Don’t expect to see these technologies until oil starts to dry up, (they love gouging you at the pump.) or significant pressure is applied. Gas stations would have to carry these alternate fuels and have supply system and infrastructure in place which will involve considerable expense and therefore loss of profit to all important shareholders!

h) Electric cars. Have you seen how an electric power station generates power (baring solar etc) they spew coal or nuclear waste out to generate the electricity, I rather use the diesel thanks!!!!

So what am I saying with all this, don’t buy a Hybrid, the Europeans have it right, get yourself a state of the art diesel for the next car and save the environment and you pocket with significantly reduced expense!

Copyright Jonathan Rose 2007 – Creative Commons License

This work is licensed under a
Creative Commons Attribution-Share Alike 3.0 United States License.