Euro Crisis Confirmed - Thanks Tony. We didn't know

As if we needed his validation, Tony Blair has confirmed that we have a real Euro crisis. Thanks Tony, we needed to know that.

What he also tells us is that there are two bad questions to be asking at this time:

1) Who caused this problem?

2) How can we solve it so that it doesn't happen again?

Why are these bad questions when they seem perfectly reasonable and central to solving the repeating cycle? Well, Honest Tony tells us that the key issue is to solve the crisis that we are in today and save the Euro or face catastrophe.

Or are there other reasons? Well, analysing who caused the problem would mean dissecting his tenure as PM and that's sacrosanct - nobody should be allowed to refute the Blair Years. And that if we found out the answer to 1) then we would work to limit the scope of financial people and what they can do and earn in 2). Oh, and Tony now works as a Non Executive Director paid $millions for both Zurich and JP Morgan. Vested interest seems to spring to mind but there's me being all cynical again.

Fair play, Tony has lost a couple of good friends in the last few weeks and I don't mean his mentor, Lord Gould (RIP). I mean Silvio Berlusconi of the free Tuscan holidays and Col Gadaffi - he'll be running out of places to visit soon.

Blair is wrong about the questions, as with many other things he tampers with. We need to get to the heart of the problem to stop this cycle that we are in and stop being faced with the daft dilemma of: a) Try to grow out of trouble and increase deficits or b) try to cut deficits, don't grow and the deficit rises anyway. We are damned if we do, damned if we don't. We have to go back and tackle the root causes before we are beholden to this dilemma always.

The fact remains that we allow a thin proportion of the world population to earn mega bucks and we don't get any social benefit out of them doing so but get all the downside when we wake up and realise there were no real profits at all. These people pay proportionally less tax than anyone else on the planet. Their companies do the same. We need to stop this happening. I don't think OWS has the right answer as capitalism is required but even Milliband was close to the truth when he described this as 'Predatory Capitalism'. And that's not even the right description - it is that fact that these people own us.

We believe that if we stopped these people earning this kind of money by playing the games they play with world money markets then capital flow and credit would dry up. That isn't that case. There is more than enough money for these people to earn for the rest of their lives if they used the money to do the right things in a capitalist society. Greed is a terrible thing. There are only so many millions you can spend in a single lifetime.

The problem is that Politicians are patronised and controlled by these people. Robert Peston is not far wrong. Only last week there was a platform where David Cameron was speaking to entrepreneurs which he shared with Philip Green. This man earned a single dividend of £1 billion from Arcadia and did not pay a single penny in tax and he is revered as a great businessman, knighted under the Blair regime - a shining example of entrepreneurial genius.

He's not the richest or the real offender on the financial stuff although he can leverage billions for takeovers from the same banks we use and make billions without staking a penny when we can't even get a decent mortgage offer on bricks and mortar. That's the difference.

Until we break this cycle we will never get anywhere and that's why people like Blair, who have been corrupted by patronage and money, need to be ushered off the scene and some real people ushered in to get to grips with these problems. And David Cameron is not behaving like the right sort, for my money, even though he understands the big issue of deficit better than most.

But Tony has spoken, we must listen. Old programming dies hard.

Murdoch Mysteries or The Sopranos?

It's hardly front page news now - single unremarkable lions on the BBC website, a small article in the Daily Telegraph. James Murdoch, having been sensationally recalled to face a Commons Committee again for allegedly lying to the last sitting, walked away with the moral high ground as self-seeking theatrics took over from pragmatic, forensic analysis. By trying to trying to sensationalise the News of The World's (NOTW) sensationalism, its proprietors could actually walk away under the smokescreen of naivety. James Murdoch must have spent a great deal of money being trained as to how to parry tough questions by his legal team. In the end, it was money wasted as the MPs hadn't prepared their questions or their line of thinking. Maybe that was the way a good 'Mafia' trial should be - if the law of 'Omertà' exists and the Newspaper itself was 'Corporately Murdered' so evidence was 'torched' by a callous, professional 'Hit', then there was no longer a reason to search for the truth? The NOTW and its former employees sleeps with the fishes, indeed.

In reality, the questions about who authorised what were never asked with any fervour to get the truth. Instead of unravelling the Murdoch Mysteries we got the histrionics of the fictional Sopranos. James Murdoch walked away unscathed. All because the questions asked were the ones he could deny and say it was his word against others. Nobody thought to ask, why, in such a well run massive corporation, was governance and management procedure not in evidence whereas everyone knows that it actually does exist in the company?

In asking how such widespread, illegal phone hacking or other unpleasant activities were going on under the noses of managers we might have got somewhere near to understanding how a company could be run without proper management procedures, governance and ethics. How could such large, regular payments be made to outside agencies for 'information' without a proper authorisation procedure? Why, in allowing such payments to be made without authorisations (if they were), was there no counterbalancing inquiries into whether the products of the payments (information) were actually worth the expenditure? In other words, if lower level managers were being authorised/allowed to spend cash, without sign off, where was the management governance to have allowed this to have happened in the first place and was there any assessment of the results of allowing such 'no questions asked' payments to be made? You can't have one without the other in a properly run company - ideally neither.

So, the questioning really should have tackled the issue of why management allowed such activities to have been paid for, because surely the reason management would have allowed 'unauthorised illegal activities' would have been lapse procedures and corporate negligence or because it gained them competitive advantage. Someone would have seen large sums of money being spent by someone or some people without management sign off and question what the results were. For example, if there was management ignorance perhaps it was because the results of the spend were so good as to drive circulation and profits, which is a form of guilt. Or if there was true management ignorance then they were guilty of not only allowing unauthorised spend and but also of not managing the business in terms of matching costs with results.

And, when James Murdoch himself signed off the £700k cheque to Gordon Taylor as compensation, why did he not ask the questions himself to try and gauge how extensive these payments were and therefore understand what the total potential exposure to further payments could be so that he could accrue cost for it and let his Board know? When that huge sum was paid, why on earth did his father not step in and ask the same questions - or anybody for that matter? It's unfeasible in a well run, indeed any, company.

You see you cannot have it always here. The Murdochs are trying to tell us that they run companies without asking questions about the basics like looking over accounts or having procedures and authorisations for spend levels and there was no corresponding scrutiny of the results. This does not match the highly aggressive and ruthless way that the family has run News Corporation. You don't make money without setting out the rules for employees - or will they have us believe that there was a truly delegated structure of authority down to reporters themselves that allowed them all to spend what they liked on anything they liked so long as the numbers look good? Regardless of legal consequence, corporate failure or ethical issues? 

Sound like the Murdoch family? I think not.

In fact, the opposite. When the questions got tough, they showed what they cared about customers, shareholders, employees, suppliers and all - they simply killed a company with a single 'shot'. The NOTW was shut down to kill an annoying line of questions. With it went 165 years of company history, the severed contracts of employees, the contracts of suppliers, building leases, the regard for customers (it had the largest Sunday circulation), and finally any regard to the law. Ethics were long gone. Ruthless Murdoch management rose up and defied common business practice and shut a viable company down in front of authorities and in the public eye.

For all the employees, they took the full blame for all the illegal activities. In reality, it should have flowed up the management tree because if the parent companies truly did not know what was going on then it HAD to be due to lack of procedures, lack of normal management practice, lack of codes of practice, lack of ethics, lack of care to the law, lack of diligence to the shareholders and basic malpractice in business as well as total disregard to the procedures of obtaining news stories which are the very heart of the entire business. That means it wasn't the employees' faults - it was management's inability to run the company responsibly. The closure of the NOTW was itself in violation of every contract that existed in the company. It was a total violation of the rights of every employee - not one was consulted beforehand, no inquiry made as to how they illegalities came about and who was to blame - every one goes. Like a kid not liking the way the game is going, they take the ball away.

In that case, every employee has a bone fide case for Unfair Dismissal in the eyes of the Law, suppliers have every right to claim illegal severance of contracts, customers would have a right to compensation as they would each have implied supply contracts with NOTW (an interesting assertion) and creditors would have every right to ask for full payment of debts and then some.

The MPs missed all this. It became about grandiosely trying to insinuate that James Murdoch had personally known specific details. There was no real teeth to it all. Someone personally signed off the accounts for NOTW and under US Sarbanes Oxley regulations, that person has culpability along with the companies' board for any illegalities or irregularities - you sign off saying you know every detail about all spend. If you haven't taken care, then you are liable for the consequences. That's the rules.

You see it wasn't about phone hacking per se, this was about Corporate Governance. If the MPs had studied how News Corporation makes decisions down to the last penny, they would have found their 'smoking gun'. Instead, we got a lot of grandstanding, pathetic shenanigans ending in a veiled threat by a senior executive of a Corporation to shut down another viable business in the UK flaunting every Corporate and Employment Law. If such a consideration is being made at his level on grounds which are not financial then surely he has already put the employees of The Sun under unofficial notice that their jobs are at risk. Not just a couple of jobs - the lot. Every supplier has been served notice of potential breach of contract, every lessor the notice that a lease will be broken etc.

This is Corporate irresponsibility of the highest order. One family seems to be able to get away with that, allegations of phone hacking, allegations of police bribery and flaunting every employment law in the land.

And James Murdoch walked away. Indeed, we may have felt sorry for him had he not got those rather odd looking glasses on that makes him look like Herr Flick - even the black tie in preparation for the death of The Sun?

Shareholders, customers, suppliers and employees alike should have got the clear message - this is about family, not about you. It was not Murdoch Mysteries or The Sopranos - this was The Untouchables.

Decision Making The HP Way

Twists and turns, U-turns and reversals - there seems to be nothing very logical about the machinations of HP's decision making. Part of this is that it has had more CEOs than the average pub has managers in a 5 year period. Part of it is that it's board and staff don't seem to be able to convince themselves of which is the right way forward. So business becomes a series of jerky movements forward followed by rapid turns and reversals.

Having retracted the decision on selling the PSG business, the new CEO, Meg Whitman, is now contemplating the decision to ditch WebOS. Not many months ago, WebOS was seen as a key component in HP's future. Having bought Palm for $1.2bn, HP's foray into the tablet market was to be the first step in a whole new direction for the company with WebOS at the heart of it. Then came the tablet fiasco. No sooner did it debut was it pulled from production and HP's future as shops fire-sold the devices with paradoxically great success. Many WebOS employees have been fired and it was only a matter of time before the whole disaster was brought to a close.

Then Whitman recently announced that WebOS had a new life. There was a potential that it could be repackaged and sold as a bunch of assets at least - for some fraction of the original outlay in good old HP fire-sale fashion, but at least some pennies would roll back in. So Whitman has bought herself some time to decide on all this.

But perhaps what was behind this bizarre form of decision-making, apparently made at an employee meeting, was that HP were testing the water. It seems that management by leaking information uncontrollably has its advantages. By leaking this information then HP can gauge the response of the markets to its plans. Better still, some buyer might emerge in response. It's taking, 'Running it up the flagpole and see who salutes' to the extreme.

This follows announcements by two senior HP VPs in recent weeks - one said that WebOs would continue to evolve, be updated and supported while another did not rule out WebOS having some role in HP PSG's future. Neither comment would have sat well with the deporting employees.

It actually is quite comical in some respects but very serious in another. The comedy value is that senior executives hardly seem lined up on the WebOS thinking making the whole saga look like an episode from the Keystone Kops while the serious part is that HP's underlying strategy seems to be non-existent.

For all his undoubted bad points, at least Apotheker had a plan. He had some kind of vision. Clearly it wasn't to many people's liking and the execution was an outright disaster but he had some semblance of an idea that the PSG business was going to hold the company back in the future by mixing low margin, bucket shop products with high margin software and service. IBM has shown how making those tough decisions can create a different and rosy future.

Give the new CEO time to bed, I hear you say. That's a good point but so far the cohesive thinking of executives and decision making has been at all angles. Let's just say that so far the messages are not good.

Why bankers won't go to jail

Thomas Power wrote a super blog recently asking us all when would the bankers go to jail? In the same vain we can ask, will Occupy Wall Street and the protest outside St Paul's that has cost a few heads in the Church come to anything more than provide some soundbites for Ed Milliband?

The answer to many gnarled and downbeaten old lags like me is that they probably won't. After all, we love the lifestyle and apparent boom we have lived in. No one wants to give back their sofas or 50" plasma TVs and all the rest of the materials we have acquired over the last 15 years thanks to the largesse of bankers who have extended us cheap, easy to get credit.

I am cynical in my old age. I ask simpler questions than the complex ones like asking if bankers have defrauded their shareholders or the taxpayers. I ask, if my pension and investments have been entrusted to these people over the years, why is it that my portfolio and future income is virtually worthless when the very people trading in my money are super, super rich? How is it that over the same period of tracking my investments that individual bankers' net wealth has risen astronomically through good and bad times while mine has gone backwards?

This is the essence of casino banking. With no care or lack of understanding why they have been entrusted with people's life long earnings to give them a future after work, these people just throw it at outlandish bets for unfeasible personal riches while moving my pile not a jot.

It is about the instruments that bankers have invested in, it is about the lack of controls and ethics, it is about the over arching need for personnel gain that totally neglects the purpose of why bankers are entrusted with my and your money.

Bankers haven't committed fraud or diddled their shareholders - they are just betters the same as the shareholders are. These bankers have hoodwinked you and I. Amidst the caveat of 'what goes up, can come down' they have protected their backsides for zero comebacks. Our investments could collapse to nothing and there is little we can do except mount prolonged cases to try and get some of it back which could take years. Meanwhile the bankers move on to the next super rich job.

The benefits and rewards in banking for those who trade in our money are completely out of kilter to the performance of investments of the individuals who entrust them with the money. Ah, not unless you are also part of the innermost, secret circle where the world of finance and riches are available to you all. For this, you don't have to be rich, just a gullible politician will do. You can become rich if you can come into the game with a chip at the casino.

Bankers just exploit us at every turn. It shouldn't be about having to use the law to stop them, we should be the ones who stop them. This is our money, even our tax that keeps them afloat, this is our future, this is our expectation of return.

How can we stop Wall St and the City from just raping us at all points? The only way is to stop investing. Stick the money into banks with no investment trading arms, demand some return and then put a caveat that this money cannot be used for anything other than mortgage or asset backed lending. It's time that we demand what returns they make, what the top end salaries should be and what is a fair return on our capital.

It's daft, it's fanciful, it's wishful thinking, it's naive. It will grind the financial machine to a halt, it will stop the flow of credit and capital. It will put people out of work. There are countless arguments against such illogical and pathetic thinking of people like me.

But the alternative is we just sit here and watch a small percentage of people earn incredible wealth with no relation to the increase or decrease in the value of our investments - the very things they are meant to grow.

Bankers trade in instruments that only make them money - it's a game we are not part of but we do loan them the chips to play the game and we do guarantee their losses. Well, the only way to stop that is to simply stop giving them the money and to vote out any Government that agrees to underwrite losses.

Banks are businesses. We have a right to dictate what they earn and demand certain obligations back - we are the customers. One is a duty of care. Banks have wilfully and negligently lost fortunes for us all. That's as good as theft.

When kids rioted in the streets this year and destroyed property, they got custodial sentences and loss of liberty plus fines. It's ironic that part of the problem was caused by the economic and social conditions in which we live and bankers are a cause of that. Society is fast becoming polarised and we are in danger that capitalism is being allowed to get out of control. 

Am I agreeing with Milliband? Nope. He just mouths the words. I don't see him sitting outside St Paul's in a tent.

Then again, neither does a cynic like me. In the end, I rant and rave at the injustice of it all but then I get back to the life we have created for ourselves. 

Must nip down the bank and get some cash out. If there's any left.

Clouding the Issue

I read an article in CRN recently about security in the Cloud, specifically relating to data. It cites that the Information Commissioner (ICO) - right, I hadn't heard of him or her either - can fine companies up £500,000 for reckless loss of data.

The article, by Steven Hughes who works for COLT, puts the frighteners on anyone considering Cloud as it bangs on about robust security procedures and that these cannot be covered by an SLA from a provider (unless it's COLT, I assume).

It caught me thinking that security policies are openly flaunted by companies every day with or without a Cloud infrastructure. Laptops full of data are carried around by employees, including senior executives and CIOs, every day and losses are actually more regular than you think. While it may be difficult to get access to the network from these lost or stolen devices, the local information on the laptops is far more easily accessible.

It almost argues in favour of a consistent, central policy for data handling which is protected by a VPN login and the Cloud is as well suited to that as any. It would argue that local data on laptops is actually very bad policy, even if this is good practice by mobile employees. The fact is, with modern communications, access to networks via VPNs is getting far easier and so excuses are getting less for local storage.

While Steve Hughes highlights important points about data security and policies, the fact remains that most companies may have policies but few rigorously use them even without Cloud infrastructure. You could even say that Cloud isn't the issue here - it's people.

The article does look at a couple of other areas of great importance - notably SLAs which can be nebulous and even meaningless with some hosting companies - and the consumerisation of IT (or Bring your own device - BYOD) which threatens security in corporate networks. Given that executives surveyed by CRN recently rate BYOD as less than 30% in terms of importance to company executives in terms of a threat, then Steve Hughes makes a very key point. BYOD is a threat and it should be taken seriously.

Security issues surrounding data don't change when you view the Cloud, it just brings them into sharp focus. My concern is that it isn't that the Cloud per se is unsafe, it's company policies and procedures governing data are usual at fault. This doesn't really mean that Cloud is an issue - it just makes sure that companies consider the implications and check their compliance and governance targets are met when considering the Cloud or any network.

Cloud Storage Shootout - Dropbox vs. SugarSync

We are talking Cloud storage here and not technical geek stuff but practical advice and commercials.

Free online, Cloud based storage is two a penny - I mean free - these days. You can get about 5Gb of storage for free practically anywhere and that's usually plenty for the average home user or even a small business person like myself.

You could even get sassy and play with a few of them and up your available storage but keeping track isn't easy. The nice thing about Dropbox is that it is easy to set up on any device with minimal installation and it just appears as a place to store your files. On a PC it opens a 'My Dropbox' folder in your Documents area which is easy and it's the same on your Mac. On your iPad, most of the applications seem to have an option to store to Dropbox and this gives the device some semblance of a file manager which is horribly lacking for local storage which is done per application. The same for iPhones and Android devices. Dropbox is neat, easy and works across all platforms.

Where it is ideal is that if you are working in a project, you can simply designate a folder to be available for anyone in the project to see by giving permission and the link. Version control is an issue and so it doesn't work like SharePoint which has dreadful limitations but at least version control is good. But getting over that, it makes projects easy to manage.

The downside of Dropbox is that it is not really secure. Permissions can be handed out too easily and there is no restriction once permissions have been given. Further, if your iPad is stolen or lost, it would be easy for someone to swipe their way in, run Dropbox and have access to all the files on there. For larger firms, Dropbox does not have many certifications to make it compliant with things like Sarbanes-Oxley or Payment card Industry bodies. 

Finally, it doesn't solve an important issue. If you work on some files and store them locally, maybe offline, then there is no way of synchronising with files on the Dropbox. You have to remember what you have done and then manually store the new file, overwriting the old. There is no automatic storage facility or synchronisation gizmo.

Last week I mentioned SugarSync. This seems to be a really good mix product although it isn't as good looking in its look and feel as Dropbox. Again you get 5Gb for free but what it allows you to do is to synchronise common files over all devices. This means if I designate that My Documents should be synchronised to SugarSync, then not only does the whole directory get automatically backed up but it is synchronised with the same directory for any of my other devices that I want those files to be seen on. So I have my PC, Mac, iPad and iPhone seeing the same directory. It means I can change any file in that directory on any device and it automatically synchronises across all the devices.

It takes a short while to get set up and needs decent bandwidth at the start but after that it works on a per file changed basis so it doesn't do lengthy back up cycles. Like Evernote, this is the first really useful application dedicated to synchronising and it really makes a difference.

To be clear, SugarSync doesn't need to have a 'My SugarSync' folder as it synchronises your on device folders. It's a back up service and synchroniser in one. So all you do is designate which folders you want to synchronise with what devices. It's that simple.

I have upgraded at $49.99 per year to have 60Gb available and so I can also synchronise my files on my Parallels virtual machine with my Mac, my old PC, iPad and iPhone. I can still share folders or files in the same way as Dropbox and there is still some doubt on security if a device goes missing but you can set a PIN on any device to stop prying eyes and I use this on my iPad.

So in my book SugarSync is the more useful of these applications. You can also have a small business plan which effectively gives you network storage in the Cloud and starts at around $299 a year which is really pretty good value. As with any Cloud application, make sure you are comfortable with the security aspects for your business and take the proper care but this seems to be a great way to make files available across all devices cheaply and flexibly.

How many deals can we take?

Groupon debuted on the US stock market yesterday raising $700m and valuing the company initially at $12.7bn. That didn't last long as the shares leapt 30% on the first day of trading. The price tag actually shot up at debut as demand for shares was high as so little of the company was actually put up for sale.

The business model for Groupon is remarkably simple. It connects lots of people to aggressive transient deals from businesses in their local areas. I subscribe and as yet I have not seen a single deal worth taking as its all about hair treatments, teeth whitening, laser hair removal, blah blah most of which I have little left to treat. The estimated cost of acquiring each new customer means that Groupon will accrue huge losses until one day, as they all will, profit will be realised on every mug user who signs up as if by magic.

The model itself is under pressure as Vouchercloud in the UK offers far more practical deals like restaurant discounts or laundrette vouchers. But there are hundreds more firms doing the same. Including the mighty Amazon and Google. It's bonanza deal time.

But how long can it last? While the economic times are uncertain, deals are a bonus. But what happens when that's over?

I may be getting old but I can't see why anyone could not start up voucher schemes of this nature and challenge Groupon. I really don't understand how the valuation can be so high on basic 'Me too' business scheme? And surely this scales well in the US but it has real problems scaling outside?

But that's just me. It surely isn't another Emperor's Clothes issue, is it?