Archive for the ‘Opinion’ Category
The Three Most Interesting News Stories of 2008 January 1st, 2009
I’m not one for New Year’s Resolutions, but I do love a ripping good yarn. To start off 2009, here are the three news stories that I found most interesting from 2008 (excluding all of the coverage and excitement for Obama of course). Each nomination is followed by a brief excerpt to further entice you.
3) Chinese Attempts to Conceal Rampant Pollution (and its failure)
Although they possess the world’s largest weather modification program, the Chinese point to the Russians as being the most advanced. In 1986, Russian scientists deployed cloud-seeding measures to prevent radioactive rain from Chernobyl from reaching Moscow, and in 2000 they cleared clouds before an anniversary ceremony commemorating the end of World War II; China’s then president, Jiang Zemin, witnessed the results firsthand and pushed to adopt the same approach back home.
2) The Story of the Wax Cartel (and the $900 million fine) (also notable for the best supervillain name of 2008: Tibor Toth)
Most cartels operate in secrecy, destroying documents, encrypting e-mail messages or using prepaid phone cards to erase communication traces. But the paraffin cartel was rare in that some members kept minutes, and attendance lists. Cartel members e-mailed invitations and sought R.S.V.P.’s. They booked each other’s rooms and played host to open bars.
1) Somali Pirates (and its many tales)
When asked why the pirates needed $20 million to protect themselves from hunger, Mr. Sugule laughed and said, “Because we have a lot of men.”
I can’t wait to see what great stories will come out of 2009, hopefully some news a little more positive than the last.
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A Note on Energy and Contrarian Investing November 11th, 2008
I normally wouldn’t write publicly about financial decisions, but given the type of internet mutualistic relationship I have with my blog visitors, I can see no harm in doing so. The recent financial crisis sucks for a lot of people, but a friend of mine recently convinced me to start investing after he made a $10 investment in Fannie Mae when it hit 35 cents a share. First I followed suit and got some money in Fannie Mae, right as the bailout was being discussed, and then I bought up some Royal Bank of Scotland when it hit the lowest point in decades and another European bailout was in the works. I based my thinking on long term strategies backed by government guarantee, sure the banking industry is in a terrible fix right now, but these massive companies aren’t going to completely fail, right? (Weak laugh).
I talked things over with others and learned that my style of investing was lovingly known as “Bottom Feeding” as I was taking advantage of the suffering of other investors. Actually, with some more research, and an incredible article by Warren Buffett I learned my recent investing strategy is known as contrarian investing. Buoyed by this outlook, I continued my research and came to the conclusion that I should be investing in companies that represent my values rather than simply the seemingly smart financial plays I’d made earlier. I started looking at name brands that I knew, but my retail experiences didn’t seem to mesh with professional analysis. Continuing my search, I’ve proudly settled on a theory of socially responsible investing.
Without going into my extensive political beliefs, I was rather shocked at some of the arguments made during the election season with regards to energy. I am wholly dissatisfied with the pollutant output of most energy sources and I am firmly resolved on the change clean energy can usher in. You can make economic arguments for job creation, but forcing a backwards energy technology would simply prolong the negative effects of the industry. I am mostly referring to coal and the ludicrously labeled “Clean Coal.” Some have argued for nuclear as a long term solution, but this fails to recognize the incredible investment of money and time required to get a single plant online. Solar, to me, represents an increasingly efficient technology that can bring the systemic change the world needs. There are not transportation costs, power is generated on site and storage (though rather lackluster now) is removed from the electrical circuit. No drilling in foreign or domestic lands, no shipping, no Yucca mountain expansion, no blackouts. It could be a simple societal process dictated by technology that is anything but simple.
Given my beliefs I embarked on a long project to track down a solar company that also represented a sound investment. After compiling a short list I tracked the progress of each company over the course of about three weeks. For those curious, my final four were First Solar, JA Solar Holdings, ReneSola and the SunPower Corporation. After tracking the fluctuation and finding a balance of market cap and the business model I decided on the SunPower Corporation. Yesterday I invested my most recent blog writing earnings in this large solar energy company that is vertically integrated. How I fare in the market recovery hinges on the prospect that solar energy offers.
Although solidly profitable, the stock prices for these companies have plummeted just like all the others on Wall St. However that means they are terrific investment opportunities even if their earnings decline due to slowing economies and the credit crisis, he said.
Throughout the international financial crisis I remain optimistic as history has proven that humanity endures and progresses due to the work invested in positive movements. But as always, this is just my two cents (hopefully worth more soon).
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Competition in a Prolific Market October 28th, 2008
Over the summer I wrote about an iPhone application that I thought was a fun, simple and innovative idea. It took the traditional handshake and business card exchange ceremony into the 21st century. Granted, it was completely limited to the iPhone, but like all good ideas, it would have easily spread to other devices. I could never really see myself taking advantage of this technology when it was proposed as it’d involve the assumption that both individuals had iPhones and the required software, but my interest was on the concept rather than immediate implementation. Now, after checking the site for release, I learned of an unknown competitor releasing the same concept before the original company got theirs off the ground. In addition to capturing the market, this other company is offering it for free.
This situation raised questions of the changing environment of copyrights in a prolific market of computer applications as well as the dangers of previews. Thanks to widespread coding knowledge, innovative applications can be recreated and even improved upon before the original is even brought to the market. Beyond slight changes in GUIs, it has become a crowded competition of principles that ultimately benefits the consumer by driving down cost (or in this case eliminating it altogether).
In a letter to Isaac McPherson on copyrights and invention, Thomas Jefferson stated, “It is the principle…which constitutes the invention, not the form…nor the manner…nor the material.” While this rather outdated reflection (August 13, 1813) doesn’t have much resonance on the market today, it was an intellectual argument at the fundamentals of copyright law. I find it compelling that even amongst the rapid competition for innovative applications, companies are willing to showcase unreleased software. Odds are it has a lot to with generating positive publicity for their soon-to-be-released products, but it clearly is a risk as Tapulous lost big time with their iPhone contact exchange application gamble. The fundamentals of software competition are strong, even if the benefits may be lacking.
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Rant: A Note on Business Models September 12th, 2008
What happened to MegaSex I? Did it sink? This picture was taken in Lisbon and I thought it was a comically bad name for a business. However, I’ve found that the name of a business doesn’t really matter if you have a solid business strategy. Recently I’ve been doing some absent-minded thinking on the variety of modern business models. I will not profess that I have any professional experience or even any knowledge on the subject, but most of the time business models seem like common sense. If you create something of value, design a framework that keeps people interested, makes you money and does it all without alienating the fans. Here is a sampling of business models that I’ve noticed in the past week.
The Good Model: Hulu
Hulu is a relatively new website that takes copyrighted material like TV shows and movies, uploads them on to the internet and provides them to the public for free. This concept is not new at all, illicit and freely available piracy sites come and go daily. What sets Hulu apart is that it’s legal and even encouraged by the copyright holders. Unlike sites like YouTube that scrambled to make videos profitable, Hulu formulated a model and stuck to it as the traffic poured in (but it is important to note they had $100 million in venture capital backing them). Short video ads are interspersed with the vast amount of content to make money and scale based on the length of each clip, episode or feature film. I hate advertising as much as the next person, but when it’s a 15 second break between the Daily Show in HD, I will gladly endure. I see this as the future of television, I just hope they can keep it as profitable and smooth as it seems now.
The Bad Model: Remember the Milk
What makes me sad about this business model is that I love this little web application. It’s a simple idea of an online to do list to aid forgetful people in everyday mistakes, like remembering the milk. It has a heartwarming story and is run by some nice playful people, but they have a truly crummy model when it comes to making a profit. 
The photo on the right is taken from their website and is the explanation of why users should sign up for a “Pro” account. Many sites have this approach (Flickr, gmail, etc), but Remember the Milk cuts the basic services and forces you to pay for them instead of adding new features. Let me explain further. Gmail and Flickr add the storage space available to you. They implemented this by keeping the great free services consistent and just adding these features under a new account header that appeals to heavy users. Remember the Milk took the basic concept of a to do list and ported it onto phones, but than revoked those features and slapped on a ludicriously high $25 a year price tag. I say ludicrously high because on principle, a to do list should not have a subscription based business model. This is software, that could even be implimented offline, not a service that requires continued fees. ISPs, cable and phone companies all have legitimate reasons to have continued fees (don’t get me started on text messages, I could rant about that for a while). The bottom line is that Remember the Milk is a poor excuse for the Freemium business model because they have yet to impliment premium features worthy of their price tag.
Last Word: It’s hard for me to judge these businesses when I’m pouring myself into a blog that isn’t ad supported and is mostly a drain on my free time and money. Luckily, I enjoy doing this and I do it for my own satisfaction (which is why I took a month to tell anyone it even existed), but if I come up with a simple business model, who am I to turn it down. In the meantime I’ll be waiting for the right job offer, partnership or other opportunity to come my way.
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Rant: A Note on Packing August 22nd, 2008
On Monday I head back to school and as my friends start to converge on the lovely college town I realize how drastically different my perspective on preparations are. This rant is mostly inspired by a cyclical argument from dinner last night with some friends and maybe this doesn’t apply to everyone, so apologies upfront. That said, I’ve found that I pack light compared to everyone. For example to go abroad for 6 months I brought a backpack and one medium sized piece of rolling luggage. It goes beyond packing, I guess I just don’t have that much stuff. I seem to be the only person I know who still only has one pair of sneakers/everyday shoes.
The discussion for the week is all about getting ready for school. Am I mentally prepared? Sure, why not. Do I have a way to get there? As of two days ago, yes. Have I started packing? No. That’s where I get lost. Packing is a singular action that takes an hour at most. I don’t need to prepare to start, dive in and then take breaks, only to return to the task like a dreary coal miner. You just take your stuff and transfer it into a bag.
I am flabbergasted at people who lay things out or think through the process like a you’re chosing a life partner amongst a lineup. I’m also lost at people (read: women) who bring so much stuff. If anything, that makes the process so much easier. Dump it in some luggage or just cram it in the car. I eagarly await the usual image of freshman showing up on campus with cars stuff like a tube of cookie dough. Just one prick of a toothpick and it all spills out.
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New Jugs: The Milk Design Soap Opera August 14th, 2008
This bottle is not the topic for this post, apologies for not having a worthy photograph in my archives. That being said, in the past few weeks I’ve notice a number of people voicing their opinions about a new milk jug design. 
Milk jugs are something you do not notice, you take the design for granted and maybe it’s just me, but I’ve never appreciated the thought process that goes into such an everyday item. For those of you not following the news, here’s some background. Sam’s Club and Costco have introduced a new container for milk (pictured on the right) and it greatly reduces the packaging and transportation needs. This essentially is just a more efficient design that saves the company money by cutting back on costs, but it also reduces the environmental needs of transportation. It may not seem like a big deal, but for bulk stores like these those carbon footprints are massive. The New York Times first had a big article about the “controversy” surrounding the new jug and even went so far as to interview people about their feelings. This article spurred trickle down articles and many blog posts bemoaning the hardships of the new jug. In the NYT’s article they included a handy graphic that lays out the issue, I’ve included it for the visual learners (like me):
At first I thought this was a comical story of a distraught housewife who couldn’t cope with small changes to her routine and maybe, just maybe, it was worthy of a local news story…but the New York Times? Turns out, this is actually a big deal in America. Retailers are running an opinion poll about the new design and Sam’s Club even went so far as to offer “Milk Pouring Classes.” Before going off on some rant about the density of the American consumer, I’d just like to say that I’ve been using this newfangled contraption since it’s debt and my reaction was simply, “Huh? Crazy looking jug.” End of story for me. I had no idea that there were all these environmental benefits and I had even less of an idea of the militant opposition brewing in America’s heartland.
The point of this piece is this: if someone comes out with a design that improves upon the old one, it should be released and accepted. It would be one thing if it’s fashion or some sector based at all on appearances, but milk jugs are nowhere near that spectrum. One of the designers on the project stated “We designed this bottle all about the function…it’s designed to be exactly what it is should be, tight compact and fitting a function. It’s not [meant] to be a bottle of wine.” I say, let the new jug travel far and wide, bringing bovine lactate throughout the land. For the naysayers, learn to tilt the jug instead of pouring upsidedown or however you could mess up pouring milk (I’m looking at you Amy Wise).
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Olympic Preview: China Loses Control July 29th, 2008
Of all the crazy things we are bound to see at the Olympics next month, snow is not one of them (I swear the photo makes sense, just keep reading). When I first heard about the measures to which China was going to put on a pretty face for the Olympics, I found it hilarious, but now it’s kind of frightening. The earliest clues I remember was hearing about the utilization of military equipment to “seed clouds” and prompt a controlled rainfall. I thought it was hilarious and frankly ludicrous, but with some research I learned that this is actually possible and was implemented by the Soviets to prevent radioactive rainfall from reaching Moscow after Chernobyl. Those crafty reds actually used technology to save some lives, quite a shock. Anyways, the Chinese have been doing this weather control stuff for quite some time and even set up a Weather Modification Department with an annual budget approaching $100 million. According to Asia Times Online:
Run by the Weather Modification Department, a division of the Chinese Academy of Meteorological Science, the program employs and trains 32,000 to 35,000 people across China, some of them farmers, who are paid $100 a month to handle anti-aircraft guns and rocket launchers.The heavy weapons are used to launch pellets containing silver iodide into clouds. Silver iodide is thought to concentrate moisture and cause rain. The process is known as cloud seeding and China has invested heavily in it, using more than 12,000 anti-aircraft guns and rocket launchers in addition to about 30 planes.
With the Olympics nearing and international attention turning to such a tightly controlled region, China hopes to show that beneath it’s rough shell it is actually full of happy beautiful people, big glossy buildings and endless rays of sunshine. Impact Lab writes:
Modifying the weather may seem a hubristic exercise. But arguably, given what else the Chinese have already invested to make this year’s Olympics a showcase for China’s emergence as a 21st-century superpower, it’s almost the least they could do. Following the announcement in 2001 that the 2008 Games had been awarded to Beijing, the government of the People’s Republic initiated $40 billion of new construction there, bringing 120,000 Chinese migrant workers into the city (at about $130 each a month) and triggering a five-year steel shortage worldwide. Today, Beijing boasts, alongside the vast Bird’s Nest, megastructures like a new airport terminal that on its own is bigger than any airport elsewhere in the world.
In the past few months, China’s campaign to clean up smog has gotten a lot of attention. A New York Times article detailed the shutdown of all factories and construction around Beijing. It was a huge effort and while it’s effects on the smog are negligible, it couldn’t hurt to even temporarily cease the most unrestricted polluter in the world. In the end, it failed. Failed badly. So badly in fact, that now Beijing is going to go to the “emergency backup plan.” This involves moving from only allowing cars with even numbered license plates to banning 90% of Beijing’s 3.3 million vehicles. A post from TreeHugger explains further:
To qualify as a “blue sky day,” which Beijing says is safe for athletes, the Air Pollution Index, which typically measures small particulate matter, or PM10, must be below 101. For the past few days, as you can see in the chart below, it’s been higher than that; today it was 113…Beijing’s pollution monitoring system has come under fire for being misleading, whether it’s because of its nomenclature (”blue sky day” doesn’t mean blue skies, and “fog” or “haze” doesn’t mean smog)…calling Beijing’s average API of 100 acceptable seems just egregiously wrong. That’s 6.5 times the World Health Organization guideline for long term exposure.
And as a public health professor noted at BeijingAirBlog, “anything above Chinese API=50 is very unhealthy. Even if it is at API=50, that is still more than double New York City usual levels, so that is not acceptable either. They really need to get the API down to 25 or below to call the air acceptable for Olympic competition.”
What I find most interesting is that only in such a restrictive society could these kind of government controls actually be enforced. I can’t wait to see what gets exposed and how hard China works during the games to get the kind of image they are hoping for. If it’s anything like the weather it won’t be good news for anyone.
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