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Monday 30 November 2009

Dublin blues

I have just returned from a 25 hour 12 minute stay in Dublin. Don't ask me how I can be so accurate on the exact duration of the stay. Apparently it is because I own a wrist watch, can read and interpret time and was not blind drunk and 'over imbibed' during my entire 25 hour 12 minute stay.

Moving swiftly on to the next paragraph...

What struck me most about the trip was how different the atmosphere and people were in Ireland. Now I only spent time in the Ballsbridge area, very close to the old / new Landsdown Road stadium.

We won't re-visit the 15 - 10 defeat the Springboks suffered on Saturday at Croke Park against the 6 Nation champions Ireland, except to say that it was highly insensitive to the gorilla bands of Springbok supporters scattered all over the sports bars and pubs in Ireland to screen the match again during the time that they needed to drown their sorrows in the national dark liquid... Personally, I blame the mist and fog over Croke Park for this latest installment on our misadventure of an autumn rugby tour.

However, the three things that struck me most about this flying visit was the fact that:

1) It rained a lot in Dublin and the wind made it quite bitter and cold,
2) That even if people speak the same language as you, there is always the possibility that you won't be able to understand a word they are saying and finally,
3) I can't remember a single thing, because I must have been blind drunk for 23 hours and 12 minutes of this trip. (I needed the two hours to sober up at the airport or be put off my flight).

Therefore to conclude: It must have been a good trip, otherwise I would only have remembered the bad bits...

Have a good rest(ing) of the week.

I certainly need the recovery time.

theMarketSoul (c) 2009


Saturday 28 November 2009

Corporate (email) Communication

Question asked on a business centric social networking site a few days ago:

Seeking Success Stories of NOT Looking at One's Personal Email at Work

I try NOT even to look at my work email at work.

There is this odd shaped device next to my computer that emits ringing sounds every so often. I try to use that to contact remote people.

Then I discovered these two appendages below my body. Apparently I can use them to get up from behind the desk and walk over to someone in the same building and get them to do things for me or share information with me. I found that utterly amazing!

I use that email thingy only to transport files across the network to people who might not have access to secure folders or servers on my end.

I discovered real people, with real lives and interesting tales to share this way.

Someone actually confided in me the other day that this is what life was like in the early to mid '90s.

It sounded great and I think they lived on a nice planet back then.

The other day another amazing thing happened. Somebody actually came to see me! I think I might have a convert here....

 *  *  *  *  *

I will be very happy to receive comments and examples of similar experiences as part of my research for an article entitled:  "The loss of civility in Corporate Communication".

Thank you.

theMarketSoul © 2009

Friday 20 November 2009

The Set-up

How great is must feel to anticipate change in the political air, yet to have an exiting government set up the next parliament and hence government for failure?
Be it a new conservative, labour or coalition government facing the United Kingdom in May / June 2010.

This must be the ultimate deceit of the rules based political governing classes currently in office. 

What is it I am referring to, you might ask? 

The proposal to entrench in statute a target to half the current UK national budget deficit in four years time.

Let’s only consider two specific points on which this idea will fail:

1)    The current recession in the UK is not officially over.  This means that the overall size of the UK national debt has not finally been determined.  Which in turn means it is still a moving target and therefore futile to target until it is finally quantified.  Need I go on?
Off course I do, because I stated that I would give you two specific reasons.

2)    This statute will become a political rod that an exiting Labour government and party can wield in around 4 and a half years time (by the time the legislation is promulgated in law), just in time to fit nicely into the next electioneering campaign, once the next government has to call another election.
Hence the timing and the timeframe in which this legislative target sits must surely be vigorously questioned?

Quite frankly whether it is 2 or 3 or 6 or 10 years down the line, before we finally pay off the debt, should not matter as long as these two conditions can be met in the mean time:

1)    We can afford to service the debt
2)    We do not have to suffer crippling tax increases

And yet here we go, lauding the efforts of a government in the sun set period of its time in office, which is focussed on reducing the national debt, by their standard irresponsible target setting culture.

I believe it is a pure and simple SET UP.

That is why I advocate a principles based approach to solving the major problems and issues facing us today in the UK.

Principles by which libertarian economic philosophy approaches the challenges ahead.

For a fuller discourse on these principles, please refer to my earlier posting The Market is flawed, or not...

However, I happened to watch one of the great principle based games earlier this week.  The FIFA world cup qualification eliminator between France and the Republic of Ireland.  This in the same week as the UK government announced the futile legislative objective of enshrining in law a target to half the budget deficit within 4 years.

There I was witnessing the ‘Hand of Thierry’ meddle in the ‘beautiful game’ and influence the ultimate outcome, of a well established principle based game, and I thought to myself, even principles have their failings…

theMarketSoul © 2009

Sunday 15 November 2009

The evolution is coming...long live the evolution

Watch out, the evolution is coming!

I am going to change tack slightly today with this posting.  Yes, you might spot a slightly more serious tone to this posting.  There are two reasons for this.  Firstly I am trying to moderate my comments with the view of getting it published via a very reputable professional body and secondly I am going to veer off my usual pure economic track towards a more accounting / finance focussed discourse. 

Partly the reason for this is that I am preparing for an “Effective Budget Forecasting” workshop in early December 2009 in Kuala Lumpur and the other reason is to draw your attention to the coming (we have been waiting for this for quite a while now) evolution in the disintermediation of financial and management accounting information production.

Information technology has now for quite a long time threatened to live up to its panacea of providing better decision support or framework for senior management.  And yet here we are, almost a full decade into the 21st Century, with still unfulfilled expectations and untapped potential.

Innovation and technology as one of the critical factors of production necessary to drive growth and advancement, through one of its elements, namely information technology, is beginning to deliver on one of its unfulfilled promises.  With IT now moving into a more mature development stage with more practitioners, better dispersed tools, general skill levels of those practitioners improving and more holistic applications and understanding of work-stream processes, I believe we are standing at the brink of the coming evolution.

Traditional budgeting and management information (MI) systems are ingrained into an organisational culture, much like all other processes and behaviours in general.

In order to change a budgeting and MI system and more critically, for this change to be successful, accountants have to stop thinking, behaving and acting like stereotypical accountants and realise that the evolution has now got some serious momentum behind it.  We won’t be able to hide behind pure accounting GAAP and IFRS statements and more importantly, our beloved spreadsheets and models, but will have to help change our systems and ways of working, via a cultural and behavioural approach to organisational change management.  Moving from annual budgeting to rolling forecasting systems should not just be about how the finance people approach the challenges, but also about how the rest of the organisation changes and adopts and adapts to systems like Value Based Management, Zero Based Budgeting and Economic Value Added® approaches.  These might seem like utopian systems for running and managing organisations, however, it is a lot more effective than purely focussing on EBITDA (Earnings before Interest, Taxation, Depreciation and Amortization) numbers for motivating and galvanising the troops to deliver.

An evolution cannot be achieved in isolation, all parts of the organisational system have to work together or be aligned towards this common purpose.

I the meantime, you and I still have our day jobs, fire-fighting exercises to concentrate on, so good luck with the evolution.

theMarketSoul ©1999 - 2009

Sunday 8 November 2009

Banking and spirituality

Now this headline really incensed me this morning:

The Sunday Times November 8, 2009 (There is your plug, you are welcome) – “Goldman’s boss: We do God’s work” - I'm doing 'God's work'. Meet Mr Goldman Sachs

How dare you! How dare you be so arrogant! Mr. Lloyd Blankfein.

I must have woken up today in quite a militant mood, this being remembrance day and all.

My daughter and I went to church this morning (my wife and son had a different engagement to attend at another church in town).

The entire nation was focused on the very poignant event of celebrating or more accurately commemorating fallen, but never forgotten victims of war, past and present, and then I made the fatal mistake of picking up the Sunday papers on the way back from church.

So, now let me explain my very limited understanding of trickle down economics and how it works:

We have a Credit and Liquidity Quake in the global financial system (see early posting on this site entitled “Comments from a 'lay-economist' on the Credit Quake of 2008 – 2009" ).

Either governments (read taxpayers) or investor angels (in Goldman Sach’s case Warren Buffett with a US$5 billion injection, see - LA Times article - "Buffett boosts Goldman Sachs with $5-billion investment" ), help re-capitalise broken and impaired financial institution’s balance sheets.

This ‘rescue cash’ starts looking for decent rates of return that money and other near cash equivalent assets cannot provide, and commences to froth up the stock markets.  We have a big bounce over the last 6 months in global stock bourses, however, very little of this new cash seeps out (or trickles down) to the next layer in the economy.  Fair enough, if big bonuses are paid to hard working bankers, (look you can only put 24 hours into a 24 hour day, no more, no less; if my mathematics does not let me down, whether you are an investment banker or a road sweeper) eventually they start spending this cash in the real economy and property assets and other non financial asset prices start experiencing a bounce and therefore all the folk who touch and are involved in trade and transactions connected to these other alternative assets experience an upturn in their fortunes.  Ergo, the next layer gets involved when the trickle continues further down, and therefore services connected to the previous layer experience an upturn in their fortunes…and so on.

So, we either stop making so much beef about the bonuses and just get it paid out so that the cash can be spent; however, Mr. Lloyd Blankfein, WE DO NOT COMPARE THIS TO GOD’S WORK!

A little sense of humility and thought needs to go into your words and deeds so that ordinary folk can get on your side and support the ‘noble calling’ of banking; or you risk the wrath and fury of the general public and a lot of work for the PR industry to help repair the damaged reputations investment and retail bankers still face.

As for spirituality, I trust your conscience will seek some catharsis and quiet reflection in the days to come.

An apology will also do nicely.

theMarketSoul ©1999 – 2009

Tuesday 3 November 2009

The Market is flawed, or not...

Fundamentally we are looking here at an issue or more accurately described as a "battle between Civil and Political Society".
The rest is a matter of degree (or weighting) attached to the forces influencing these battle lines.
What I mean is this:
Civil society values stem from classical liberal and now more accurately libertarian philosophy, which advocates:
1.  Minimal government
2.  Private property ownership
3.  The rule of law
4.  Minimal taxation
5.  Personal responsibility
Political society has a different approach and view of the world, with at its core a desire to achieve 'social engineered' outcomes, via increased government mechanisms and interference in free or 'free-ish' markets and its focus on behavioural aspects of human (and market) interactions.
It is this tug of war between the two groupings that then creates opportunity and opportunism (which for good ends or bad) gets exploited by unscrupulous market participants as they know that the reach of the 'rule of law' falls well and truely short of creating a guiding 'moral compass' or what I refer to as 'The Market Soul' © 1999 – 2009.
The Market Soul is in essence an inner guiding principle which springs forth from the well of higher levels or awareness of our own Spiritual and Emotional Intelligences.
A new book to be published soon by Dr Lieselotte Badenhorst entitled "Loony Intelligence" explores some aspects of these cognitive intelligences better.
To return to the issue at hand, which is that the Free Market is flawed, I would argue that in the opening gambit the argument is flawed; that the Free Market is not flawed but does require an injection of a moral and spiritual guiding compass, something referred to in the original article as: "for companies to start[ing] to embrace corporate ethics is their leader 'getting religion'."
The system is not perfect, but the degrees to which political society and civil society shape and draw the battle lines between how and when governments interfere, how to regulate effectively, how to encourage personal responsibility, either by 'socially engineering it' or 'farming it out to the market', how to pay for this system (fair and equitable taxation) and the framework within which we operate, 'the rule of law', is what will shape and inform the agenda in the near to medium term future.
The outlines of the debate and agenda is only now beginning to take shape, but in the meantime the unscrupulous agents in the market are making hay, whilst the attention is distracted or incorrectly focused on the wrong areas of trying to deal with the fall out from the crisis and the way in which we will deal with the mountain of debt still coming at us like an ever increasing
Idea Merchant at theMarketSoul © 1999 - 2009
Original article referred to in the above posting: