Archive for the ‘Opinion’ Category

Why I have Decided to Leave ABN AMRO

Monday, September 29th, 2008

I am a customer of ABN AMRO for more than 40 years. Last Friday I received a letter from ABN AMRO. They told me that the local branch office of ABN AMRO will be closed and integrated into a local branch office of Fortis.

 One day later negotiations started to save Fortis from bankruptcy. Today I read that ABN AMRO has to be sold to another bank. This will not solve the problem at all. It will speed up the Process of Desintegration of the Banking Industry that has started ten years ago.

 Just one year ago I wrote three blogs about the Merger of Fortis and ABN AMRO. Based on my own experience with the Merger of ABN and AMRO I predicted a possible failure of this merger. I predicted a possible failure because I did not believe the Technical Infrastructure and the Culture of both banks could be easily matched. I was Right. The Credit Crunch was the Cause of the Downfall but the Culture and the IT-Systems were the real reason. The Aim of Management was to make Big Deals (to get Big Bonusses) and the Systems were unable to provide the Right Data.

I have been working in the Money Market for a long time. In my opinion the biggest problem in the Banking Industry is the relationship between the Accountable, Bookkeeping, Systems and the Activities of Dealers. A small part of the Dealers are and were taking Enormous Risks by creating very complicated financial constructions (Derivatives). The Auditors (and the Management) of Banks have lost Oversight a very long time ago. This problem increases in severity when banks are merged.

Every time when a New Technology is implemented the Quality of the ICT-systems deteriorates. This has happened so many times that nobody really understands what the IT-Systems are really doing. Every time when a merger is accomplished the financial data of a bank (or other company) deteriorate. Two of more deteriorated systems are connected creating a bigger mess. Every time when a merger is accomplished the people who have an understanding of the ICT-systems know less about the Systems.

When a Merger takes place the motivated and skillful employees leave the “sinking ship”. The people that remain become “apathic”. They perform their duty in a “nine to five”-mode. Innovation stops. External advisory companies (or worse) outside outsourcing companies take over the maintenance and the development of the software. The quality of the software deteriorates again. The problem increases when packages or software layers are implemented. This happened in every bank around the world.

When I worked with ABN AMRO the biggest mess in IT was always created in the US. The main reason was the “opportunistic” attitude of the Management or the entrepeneurs attitude of the Management. They experimented with everything they could find but never finished anything. The US Financial System was far behind the Dutch Financial System in terms of Products and Supervision. Everybody believed the US was the most innovative in everything but they were certainly not the most advanced in Banking and IT.

 ABN AMRO was one of the bad performers in the Consumer Banking Industry in the Netherlands. The personnel of the Bank were not motivated for a long time. The main reason was the Management. Everything was decided at the top in big Staff Departments. The Branches were forced to implement what they had designed.

 The Management of the Bank loved to do Big Deals with Big Companies. ABN and AMRO were Deal-Making companies and were forced to move into the Consumer Market when the employees of all the companies in the Netherlands were forced to open bank-accounts. The Customer was never priority number one.

The decision structure of the Bank was highly complex and changed all the time. Employees at the branches were not allowed to take initiative. When they had taken initiative it took a long time before the decision was made. Most of the time the answer was negative.

The forced merger with Fortis decreased the motivation of the employees. It increased the complexity of the IT-Systems and the decision structure.

Fortis needed money and many parts were sold to other banks. Every time the Organization and the ICT-systems of the bank had to be divided in many parts. Before this process was even settled a new split was announced. This process was repeated until today.

The Consumer Banking Division of ABN AMRO, the “beautiful pearl” Fortis was after, was carefully protected. The integration of this part with Fortis proceeded. Many people moved to Brussels to create and implement a plan. Many outside advisors earned a lot of money again. Nobody had any oversight. A few weeks ago somebody finally decided to merge the branch-offices. They created new organization structures, appointed new managers, talked with the employees and send an announcement to their customers. This announcement was received last Friday! Two days later all the projects have been stopped and the employees of Fortis are leaving ABN AMRO. Nobody knows what to do!

The financial people were constantly trying to understand what the Risks were. Everytime a new problem arose and the Board had to take action. The message to the outside world changed all the time and the investors lost their faith in Fortis. The End of the (Credit) Line was reached last Friday!

A few days ago somebody decided ABN AMRO had to be sold to another bank to create enough cash to pay the current debts. The process of integration has to be reversed and a new process of integration has to be started with another Bank.You don’t have to be an expert to understand what will happen. The end of this process will be Total Chaos.

I am not afraid I will lose my Savings. The Government will take care.

I am not afraid to lose my shares. I have sold them a long time ago.

I am not afraid the bookkeeping systems of the Bank will finally break down and ABN AMRO will deny I am a Customer or present completely different data about my savings-account.

I am sure many things will go wrong. During my time as a customer of ABN AMRO the amount of mistakes that were made increased. Most of the mistakes were small but some of them really cost me a lot of time and money.

I am afraid  nobody will be able to help me when things go wrong. I just want a little bit of Service. Nothing More. I have decided to leave ABN AMRO. I am moving to RABO-bank.

I hope they will not buy ABN AMRO or merge with another bank. If this happens I have to find another Bank but I really don’t know where to go. At that time I probably have to buy Gold or another Object that keeps its value a long time ago. I really don’t know what will be valuable in the future.

Perhaps I have to start a farm and grow my own food at a place that will not be affected by the rising of the sea-level or big tornado’s or big earthquakes or heavy rain or intense drought or intense cold when the Ice-Age starts.

LINKS

 About the Merger of Fortis and ABN AMRO (Culture)

About the Merger of Fortis and ABN AMRO (Software)

About the Merger of Fortis and ABN AMRO (The Bank of the Heart)

About the Crisis in IT (About Software Layers)

About the Crisis in IT (About Outsourcing)

 About the Crisis in IT (About ERP Packages)

About the Crisis in the Banking Industry (Avalanches)

About the Crisis in the Banking Industry (Fraud)

 

 

 

 

 

 

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Posted in Completed, Economy, Opinion | 2 Comments »

About The End of the Dollar

Monday, July 21st, 2008

A well-known scientist once gave a public lecture on astronomy. He described how the earth orbits around the sun and how the sun, in turn, orbits around the center of a vast collection of stars called our galaxy.

At the end of the lecture, a little old lady at the back of the room got up and said: “What you have told us is rubbish. The world is really a flat plate supported on the back of a giant tortoise” The scientist gave a superior smile before replying, “What is the tortoise standing on?” “You’re very clever, young man, very clever,” said the old lady. “But it’s turtles all the way down!”

The Financial System of the World is a special version of “Turtles all the way down“. At this moment one of the pillars of the US Financial System (Fannie Mae and Freddie Mac) is falling and many people hope it will be supported by a financial pillar, the US Government. The two pillars have financed 5.2 trillion dollars of mortgages (5.200.000.000.000).

Since 1970, the US Federal Government has run deficits for all but four years (1998-2001) adding to a total debt of 9.5 trillion of dollars (9.500.000.000.000). If you include entitlements such as Social Securityand Medicare the debt is $53 trillion—or $175,000 for every American—andrising.

A huge part of the debt is held by two pillars, the central banks of Japan and China. The Central Banks of China and Japan are slowly moving out of the Dollar. This pillar is falling also.

The Citizens of the US are the only turtles that are left. The US Government could raise taxes, reduce its spending or raise the interest rate. In all the cases the US Economy would fall into a recession. They are unable to do this. The US voters will never elect an American President who is raising taxes or will move its country into a recession. They will always vote for the Big Spender.

Below the last pillar is Emptyness, the Abyss, The Underworld, Hell. The Universe is floating in Nothingness. The Universe is floating because it is moving. Movement is the essence of the Universe.

The problem of Turtles all the Way Down (Infinite Regress) can be solved in a Circular, Rotating, Cyclic model. In a Circular model there is No cause and there is no End. Every point is a Beginning and an End. Every Cause comes back on Itself. In the End the US has to solve its own problems and the only way to solve its problems is to accept a Recession.

The US Financial System has generated a debt for more than 30 years. They were supported by other countries to expand their economy. These countries needed the US as a buyer of their products. They also needed the US to copy their Technology and their Science.

At this moment the Economic Activity in the World is moving to the East. The countries that supported the US the most, Japan and China, are now creating their own Cycle and their own market. This cycle is completed by the addition of India and Russia. In due time they don’t need the US Market, the US Technology and US Science anymore. The US has given them all the opportunities by Outsourcing many of their activities.

Japan and China are becoming friends again and they have their finger on the trigger of the financial gun. When they move into another currency or create their own currency the US financial system dies immedeatly. They don’t need a war to win the war.

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About Sibel Edmonds or How US Intelligence is Stimulating a War in Central Asia

Thursday, July 17th, 2008

Sibel Edmonds was hired, as a contractor, to work as an interpreter in the translations unit of the FBI on September 2001. She reported various incidents of misconduct and incompetence to her superiors. She was fired on March 22, 2002. In reality she was fired for whistle-blowing. Sibel Edmonds not only discovered incompetence she also discovered interesting facts about covert operations of the US Intelligence in Central Asia.

After the fall of the Soviet Union, the super powers began to fight over control of Central Asia, particularly the oil and gas wealth, as well as the strategic value of the region.

Given the history, and the distrust of the West, the US realized that it couldn’t get direct control. This started more than a decade-long illegal, covert operation in Central Asia using Turkish operatives, Saudi partners and Pakistani allies.

The US Intelligence (CIA) stimulated Radical Islam Movements in East Asia. They were sponsoring the Taliban and al Qaeda. The US Army and his allies (including The Netherlands) are fighting enemies they have created themselves.

The funding of the operations comes out of narcotics trafficking, selling nuclear arms. smuggling weapons and terrorist activities. The US sponsored network manages the heroin industry from the farms in Afghanistan to the streets of London.

The network protects the convoys from Afghanistan through Central Asia to their final destination and they coordinate the laundering of the billions of dollars in Central Asian casinos and financial institutions in Dubai and Cyprus.

The Dutch Government is sending soldiers to Afghanistan to fight the Taliban. The Taliban are paid by the profits that come out of the trade of narcotics, weapons and nuclear arms. The US is still a trusted ally of the Dutch Government. Many people believe there is a hidden agenda but the Government is constantly denying this.

The Dutch Government is copying the behavior of their big Ally. They are suggesting a Noble Cause but everybody knows it all has to do with Power Relations and Economic Policy. The Dutch Government is constantly trying to explain to Dutch Parliament and the public why the war in Afghanistan is so important. To extend the presence in Afghanistan they almost had to force the members of parliament of the three parties in government.

For some reasons the people in parliament, the citizens and the press don’t know or just don’t want to know what is behind Afghanistan. They know about these issues or simply don’t want to believe these things are happening because they are simply absurd. They cannot believe that their ally, a democratic state, is doing all these things.

The case of Sibel Edmons started with an incompetent manager of the translation bureau of the FBI. Many of the translators were unable to translate the information they were receiving.

The manager of the bureau was not only lying to his managers about the competence of his staff, he was also trying to get more personnel by preventing Sibel Edmons to do her work. He destroyed her work to show his manager that he needed more personnel. When you are the manager of more personnel you are getting more status and more salary.

When Sibel Edmons just tried to tell her superiors that she was blocked to do her work she was fired. She was trying to help her country by showing Integrity and Courage. She was blowing a whistle and used the right procedures to blow her whistle.

Now she is very angry about her country and she is getting support of other people in the FBI and the CIA who are fed up with the constant manipulation behind the scene. To help them Sibel Edmons created the National Security Whistleblowers Coalition.

 The US is not the only country where the top management is hiding the incompetence and secret manipulations of their managers. In the Netherlands the same things are happening. They are happening in every highly bureaucratic organization and the Army is certainly one of them.

To move up in a bureaucratic organization you have to please your boss and to please your boss you have to hide the mistakes you are making. A bureaucratic organization is a perfect organization. It is managed by Paper and Procedures. The procedures are not created to manage; they are created to veil reality.

Behind the paperwork a power centre is controlling the organization. Everybody in this power centre knows something about the others. They are committed to each other by the crimes they share. It always starts with a fatal mistake but the cover up that is needed to hide the fatal mistake is a crime. When you have committed one crime the next crime is easier.

Naïve people believe bureaucratic organizations are perfect. They are telling and believing the stories that are told. The power network is using them to do the dirty jobs. Sometimes they wake up and see reality. Many of them are afraid to tell the truth. They fear to lose their pensions or are unable to get a better job.

Others accept the manipulations as a fact of life. They know that politics is really dirty business. They know that to manipulate you need intelligence and counter-intelligence.

They know that to keep the silent majority silent you have to tell the story they want to hear. They know that realistic politics is a game and to win the game to have to deceit. They know that whistleblowers are easily blocked and persecuted.

They keep their mouths shut and wait for the final moment, their retirement, when they are free to do what they really want to do.

“When even one American — who has done nothing wrong — is forced by fear to shut his mind and close his mouth, then all Americans are in peril.” Harry S. Truman

Sibel Edmons made one fatal mistake. She believed that Government was created to serve the country. She believed she was helping government by telling the truth. Now she has left government and is doing a much better job. She is trying to stop something Harry Truman feared the most.

LINKS

More about Sibel Edmonds

How the US created the Taliban

 More about Sibel Edmonds

About the Real Reason Why The US is in Iraq

More about Sibel Edmons

More about Sibel Edmons

A documentary about Sibel Edmons, Canal +, France

About the National Security Whistleblowers Coalition

A Defence Whistleblower in the Netherlands

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Why The US has to be Nice, The EU has to Retaliate and the Underdeveloped Countries have to Forgive

Monday, July 7th, 2008

The Bretton Wood agreement was created in 1947 to prevent that nations use their currencies to obtain an unfair advantage.

This was the main cause of World War I en II. The countries were obliged to adopt a monetary policy that maintained the exchange rates of its currency within a fixed value.

President Nixon broke up the Bretton Woods international monetary system on Aug. 15, 1971. The US was unable to keep its finances stable because of the costs of the Vietnam War. Nixon destroyed the Foundation of the World Financial System, the Dollar.

In 1992 the exchange rates of the member states of the EU were fixed. The Euro, a new financial foundation, was born. At this moment the Dollar is not the foundation currency of the world anymore. This position is taken over by the Euro. The EU (and other countries) are paying a high price for the Economic Policy of the US. They are paying the bills of the biggest Debtor in the World.

Many US Citizens are moving into a state of panic. Not only Real Estate and Banks are in big troube. Other highly respected industrial companies like General Motors, Ford and Chrysler are close to a bankruptcy. The Entertainment Business is also on its retreat.

The Big Casino’s are losing their customers and companies like Walt Disney, CBS and Time Warner are getting in trouble. The situation of US Big Companies is so bad that Warrren Buffett, the most succesfull investor in the World, is moving his investments to Europe. He is mainly interested in family-owned companies in Germany.

The FED is unable to lower the Interest Rates. The effective interest is already negative. When they higher the rates the economy will drop into a spectacular recession. Their only hope is a Little Help from their Friends but the amount of Friends of the US is decreasing.

Finally the Climate Issue is proving itself in many ways. The Amount of Natural Disasters (Flooding, Hurricanes) is increasing. The only thing that is still not happening is a major Big Bang Earthquake.

The US Regulators (FED) are trying to stop the Recession by Lowering the Interest Rates. The FED is helping the Banking Industry to recover from the Credit Crunch but it is not helping the rest of the economy at all. The EU Regulators are trying to stop Inflation. They are doing exactly the opposite the US is doing.

Lower interest rates push down the value of the dollar. This prompts the oil-producing countries to push for higher oil prices.

The rising prices of oil and other commodities are also a result of a Rising of the economy in India, China, Russia and other countries. A small part of the World is Going Down and a big part of the world is Going Up. The total effect of this process is a growing demand and a growing demand simply increases the prices.

The growing demand has a huge effect on the World Climate. The rising economies are polluting the environment and the decreasing economies (especially the US) have polluted Earth for a long time already. The Underdeveloped Countries are just doing what the West was doing all the time. The huge change of the World Climate will eventually hit all the economies of the World.

The World is caught in a State of Catch22. Every course of action that is chosen ends in the long term in a Global Disaster.

In reality the World is changing on many levels. We are trying to stop this change. We are unable to do this because we are unable to find a Global Win-Win-situation. To find a Global Win-Win-situation we have to Change Something on Every Level All over the World.

The Western World is not accustomed to a Way Down. It believes Everything will go UP all the time. A Recession is a temporary state down between to rising states.

The Eastern World has a completely different World View. They believe the World is governed by Cycles. We have to accept the process of UP and Down because it is the Will of God. The Eastern world believes in Destiny. Eastern people are not afraid to die. Western people fear death.

In the Western World a Human is the Centre of the Universe. In the Eastern World the Human is a Part of a Whole. The Whole is much more important than the Individual. Western Democracy is trying to Unite Individuals. In the Eastern Culture it is much easier to Move the Masses.

The population in the Western World is decreasing. The population in the rest of the World is increasing. The Culture of the Eastern World will simply take over the World just by the numbers. They are the Majority and their Majority will grow. If the World would be an immense democracy The West would be without any power. The Democratic Party of the East would win every Election.

The only way for the West to stay in power is to use military technology. The US is already doing this and it is not helping us and the US at all. The fight againgst Terrorism is seen as a fight against the people of the Underdeveloped Countries. When you are hungry you do everything to get food. When your family is killed you fight back and kill the enemy. For many people in the World it is very clear that the West is the real Enemy.

If we look at the Strategy of the Financial Regulators we can see that the US Financial Regulators are Nice to the Banks and the EU Financial Regulators are Retaliating. The US Regulators are hoping the actors (mainly the Banks) in the US will start to cooperate. The EU Regulators are defecting the same Actors. Both of them are very Clear about what they want to accomplish. Both of them want to keep on moving UP.

This is for many reasons an impossible option. To keep the World in balance the West has to Go Down. His has to go Down in a controlled Action or it has to Go Down in a Forced Action. The West will be Forced by the East or it wil be Forced by Nature itself.

The Citizins of the West have be Informed about this Situation. They have to be Informed by Politicans, Writers, The Press and they have to Educate themselves. For many reasons Everybody is Hiding the News because in the West we only want to hear the Good News.

The Banks are controlling US Government and the FED is afraid to retaliate. They are afraid that the complete US Banking system will collapse.The situation is so bad that officials of the International Monetary Fund (IMF) have informed the FED about a plan that would have been unheard-of in the past: a general examination of the US financial system.

The IMF’s board of directors has ruled that a so-called Financial Sector Assessment Program (FSAP) is to be carried out in the United States. It is nothing less than an X-ray of the entire US financial system. As part of the assessment, the Fed, the Securities and Exchange Commission (SEC), the major investment banks, mortgage banks and hedge funds will be asked to hand over confidential documents to the IMF team.

They will be required to answer the questions they are asked during interviews. Their databases will be subjected to so-called stress tests – worst-case scenarios designed to simulate the broader effects of failures of other major financial institutions or a continuing decline of the dollar.

The IMF is charged with the supervision of the international monetary system. Roughly two-thirds of IMF members – but never the United States – have already endured this painful procedure. For seven years, US President George W. Bush refused to allow the IMF to conduct its assessment. Even now, he has only given the IMF board his consent under one important condition. The review can begin in Bush’s last year in office, but it may not be completed until he has left the White House.

A Win-Win-situation is a state of a game called the Prisoners Dilemma. Life can be seen as a long chain of Prisoners Dilemma’s called an Iterated Prisoner’s Dilemma. The Iterated Prisonners Dilemma can be won when one of the prisoners is not aimed at long term cooperation. In this case he has to cheat the other prisonner and kill him to avoid revenge. If the prisonners need each other in the future another scenario is neccesary. This scenario is called Tit-for-Tat. 

Robert Axelrod (The Evolution of Cooperation (1985)) created a computer program called, “Tit-for-Tat“. The program always wins an Iterated Prisoner’s Dilemma by simply copying the behavior of the others.

Tit-for-Tat uses the following strategies:

  1. Be Nice. Start by cooperating, and never be the first to defect.
  2. Be Retaliatory. If the other player defects inflict a cost on him or her which is at least as severe – otherwise you open yourself to exploitation.
  3. Be Forgiving. If your opponent mends his ways after defecting, restore cooperation as quickly as possible, so that you can both get back to scoring highly on each round.
  4. Be Clear. Since there is no way to beat the Nice, Retaliatory and Forgiving strategy, if your opponent knows you are following it, there is no incentive for him or her to seek advantage – it will only destroy his or her score as well as yours.

Michael Liebreich applied the Tit-for-Tat strategy on the Climate Issue. He shows that we are able to solve the Climate issue when the players change their strategy. His advice is that the US needs to start being Nice, Europe needs to learn to Retaliate, and the developing world needs to Forgive. All players need to improve the Clarity with which they communicate their strategies.

At this moment the US Government is Nice to the Financial System that is braking down. It is not Nice to the rest of the World when the World Climate is at stake. The EU is still Nice to the US although the EU is paying for the braking of the US Financial System. The Developing Countries have to Forgive the US but it is very difficult to forgive somebody who is defecting the Game all the time. When you play Tit-for-Tat you have to retaliate in this stage.

When you define a Clear strategy you have to be Realistic. The world is on many levels highly unbalanced. Everybody knows that an unbalanced state will always move to a balanced state in due time. The West has to accept that the East is trying to move to the same State as the West. The West also has to accept that this is simply impossible. The Earth is incapable to provide the necessary Energy and Food. A Realistic Strategy is to Lower the West so the East is capable to Move Up.

In the West Politicians need Votes to stay in Power. To keep the majority of the Voters happy they have to Move UP the Economy. Almost nobody of the current leaders has the courage to tell the voters that the West is at the end of its cycle and has to move Down. We are taken by Destiny. The effect of the current Policy is a continuation of the Status Quo.

To move out of the Status Quo Politicians are looking for extreme certainty when they decide to change their policies. They need the backup of Scientists to show the voters that what they are Doing is the Right Thing to Do.

Science is unable to provide this certainty. The complexity of the Economic and the Ecological System of the Earth is so big that nobody is able to comprehend what is really happening and what will be the effect of a decision on the long term.

Prof. Mort Webster writes that climate policy decisions are normally made as sequential decisions over time under uncertainty – given the magnitude of uncertainty in both economic and scientific processes, the decades-to-centuries time scale of the phenomenon, and the ability to reduce uncertainty and revise decisions along the way.

Although staging climate change policy decisions over time would seem to make sense, he points out that the tendency of U.S. and international policy to change extremely slowly requires front-loading the painful decisions. Everybody knows we are moving in the wrong direction but nobody knows in detail what we have to do.

Webster shows that the best thing to do is to Prepare and Act for the Worst and change the policy for the Better in a later state. We have to take the bitter pill fast.

LINKS

About Stagflation

About the US Policy and Bretton Woods

About the effects of Bretton Woods

 

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About the End of the Banking System

Sunday, May 18th, 2008

I left the Banking Industry in 1997 because I did not want to be part of an environment where cooperation and compassion was gone. At that time I expected a major crisis. It took ten years until the crisis of the Banking Industry was very visible to everybody.

Until now I don’t think many people are aware of what is really happening and what will finally happen. We are approaching the End of the Banking System. In this blog I will show you that everybody was aware of the reasons behind the crisis. The reasons are extreme greediness and incompetence.

The solution to the crisis is simple. We are able to create a New System with Ease. It is just a matter of time when this will happen.

Let me start with two citations out of an article of Fortune April 1, 2008: “half the huge gains from 2003 to mid-2007 could be attributed to increased leverage – otherwise known as gambling with borrowed money – that magnified earnings in a boom. If a firm’s portfolio is leveraged at 33 to 1, it takes a mere drop of 3% to wipe out its entire capital“. “The compensation system is a fundamental problem. The system rewards swashbuckling behavior by everyone from traders to CEOs“.

Bankers are Gambling with Your Money. When they Win they get huge bonusses. When they Lose You Pay their Debts. You Pay their Debts because Your Investment has evaporated and/or because You Pay more Taxes.

Related post: Casinos en ligne .

The Investment Bankers know everything that is happening in the Market months before You know What is Happening. They are not allowed to use this knowledge (Chinese Walls) but Bankers are Humans and Sometimes they Forget to Keep their Mouths Shut.

The Chinese Wall is an ethical barrier between different divisions of a financial institution to avoid conflict of interest. A Chinese Wall is said to exist, for example, between the corporate-advisory area and the brokering department to separate those giving corporate advice on takeovers from those advising clients about buying shares. In spite of Chinese Walls, these conflicts of interest allegedly arose during the heyday of the Dot/Com era, when financial research analysts published dishonest positive analysis on companies in which they, or related parties, owned shares.

The U.S. government has since passed laws strengthening the Chinese Wall concept (e.g. Sarbanes-Oxley Act) with the desire to more carefully formalize and prevent such conflicts.The big problem with procedures is that they are imaginary.

In reality people always find a way to avoid procedures. It all comes down to two things Personal Ethics and Transparent Working Methods implemented in “simple” IT-Systems. As you will see later the Personal Ethics is highly surpressed by the Corporate Culture and the IT-Systems are exceptional Complex.

 Now two citations out of an article of Bank Director, Second Quarter 2003 by John R. Engen.

“The past few years have witnessed the big-money failures of institutions, due to fraud or risky business strategies“”But L. William Seidman, FDIC chairman in the Reagan and Bush administrations, says regulators shouldn’t be judged too harshly. The industry turned in record profits of $105.4 billion in 2002, up 21% from the previous year“. “To go through the stock-market drop we’ve had, 9/11, and everything else without a major banking problem shows the value of having someone looking over your shoulder“.

The Regulators knew and know about the Fraud and Risky Business Strategies but their Theory is simple. When the Banks make a Profit Everything Works Fine. The Banks earned the Profit by Gambling. The Regulators just watch over the shoulder of the Banks and are Very Happy about the Gambling System. It always Cures Itself. Some People Win, Some People Lose. It is all in the Game. Funny Enough the Winners are Always situated in the environment of the Banking Business and the losers are Small Investors.

A few citations out of an articles about Index Funds in The New York Times (May 17, 2008): “It has been long established that even most active fund managers fail to beat the overall market on a regular basis”"Stock bubbles are examples of huge inefficiencies, in which prices get completely out of whack for months and even years at a time” “We have people investing tens of billions of dollars in index funds and they are getting drawn into bubbles“.

The Stock Market is a Gambling Machine and the Value of your Stocks has nothing the do with the Real value of Your Stocks. Nobody is able to predict the effects of the manipulations of “Greedy” Bankers on the Market. The only people that really profit are the bankers themselves. They create the Stock Bubbles and Collect the Bonuses. The real value of your stocks is the dividend a company pays to his investors. Many Stocks are Highly Overvalued.

Let us move to the Employees. A few citations out of New York Times (May 16, 2008):

“You’re seeing a very, very inconsistent message to employees,” “It’s, ‘I don’t know when it’s going to happen, it may be tomorrow, it may be next month; we may be able to keep you, we may not.’ “banks are keeping employees in the dark about the size and timing of layoffs”. “She did not return to her office and ended up asking the bank to send her the photos of her son that she kept on her desk”. “many laid-off employees are not allowed to return to their desks, because the banks fear departing employees will try to take valuable colleagues or clients with them” “Euphemisms for layoffs are making the rounds too. Banks do not just fire people anymore. They engage in “head count reduction,” “reduction in force” and “redundancies.” And gallows humor is rampant. One joke: A banker calls a colleague and asks, “Are you busy? Or are you lying?”

Investment Banks use Fear to Manipulate Their Employees. You Never Know if you are able to Keep your Job. When You Live in Fear You never tell the Truth. You are Busy or you are Lying.

When You have to Perform to keep You’re Job You have to take High Risks. You keep you’re mouth about these Risks because in a Fear Based Culture You never talk about Failures. You hide them and Hope Nobody will See. When You tell Somebody about the big problems that could happen You are Fired because Everybody Knows and Nobody Wants To Know. “Après moi, le déluge” (“After me, the deluge”)(Louis XV).

Again the New York Times (May 17, 2008):

“Few employers want us around for 40 years, so our income is likely to have ups and downs and disappear altogether for brief periods between jobs. Saving for retirement is now mostly our responsibility, too. Health insurance, for those of us who have it and manage to keep it, requires increasingly large amounts of money out of our pockets. The list goes on and on”. “As fewer people have pensions and more retirees live longer, an increasing number of people may need financial help from their children” “Financial planners may not have all the answers, or the best answers, all of the time” “Thankfully, a number of Web communities and blogs have grown up around almost every aspect of spending and saving“.

Many more people will be Without a Pension. They have Lost their Investment at the Stock Market. Perhaps You even have to help you’re Parents. To do this You have to Save Money but You don’t know what to do with the Money You have Saved. The best way to get an independent advice is to use Networks of Experienced Customers. Never Ask a Bank to Give you an Advice.

And the Customers. Citations out of the Telegraph (16/05/2008):

“The conventional wisdom in financial markets is that the time to move back into bank stocks is just after a slew of rights issues has depressed prices. There are, however, good reasons not to give the banking sector the benefit of the doubt. At the best of times, as Anthony Bolton, the fund manager who ran Fidelity’s Special Situations fund for many years, observes, banks “are the most opaque of all companies”. With a building materials company, you more or less know that, barring fraud, the right amount of stock is there. With a bank, it is much harder for investors to understand the assets on the balance sheet; and in the course of the credit crisis, it has transpired that the banks themselves experienced severe difficulties in this area“.

Nobody Understands the Financial Practises of a Bank. Even the Bankers Themselves don’t Understand what they are Doing. I am not convinced Banks have kept all the Data about You in the Right Order. Someday You will Find Out that You’re Savings are Gone and Nobody Knows Why.

It does not help to create Chinese Walls when Nobody Knows what is really happening. The Controllers are and were unable to understand the complicated financial structures that were created. The Book-Keeping systems are not Covering the Truth. Even very Bright Mathematicians are unable to value the Complicated Financial Transactions. The Effect is that Dealers are able to go their own way without a proper monitoring instrument. This has created many “unexpected” situations where low-level Dealers were able to build High-Risk Positions for a Long Time without the Knowledge of the Management. When the Gambling failed the Bank lost billions.

Reactions of readers to this Column:

“I still think banks are greedy and lack integrety but they will bounce back because they are essential to a capitalist system” How can anyone believe a word they now say? Furthermore they remain in position, collecting their millions”. “It is the real investors namely pension savers and private investors who have no meaningful say and ultimately pay the price for this corrupt state of affairs, deception and lack of accountability” “Don’t let the politicians throw our money at bailing these irresponsible bankers out” “I am suffering in this downturn, and feel worried about the future. But we all have had a hand in this fiasco and we all can be affected by events (floods, droughts, disease, terrorism, earthquakes, storms and wars) which not wanted by anyone, we must plan for“.

The Customers are Powerless and Very Angry but there is no Alternative. We have to Live with the Greedy, non-Ethical Capitalistic System.

It is wrong to associate Banks with the Capitalistic System. Everywhere in the World people are Saving and Borrowing Money. The fundamental principle that was lost is to take Responsibility for what You are doing with the Money of Others. There is nothing wrong when you Gamble with you’re own money but don’t Gamble with the Money of Others. It is as simple as that.

My Conclusion:

There is Really Nothing that stops Us (the Customers) to start a Bank of our Own. The Technology is there and the Customers are really fed up with the Current System.

There are already Customers who are advising Customers for nothing. It will be very easy to transfer money without the Use of the Banking Payment Systems. If we agree on one principle, “You are trusted until you prove the opposite” it will be very easy to make a loan. There are already Systems Operational who are doing this. They are called Cooperations.

Nobody is taking the initiative to create a new Banking Infrastructure. Everybody is waiting for Everybody.

The Regulators wait and see. They hope the System will recover. I think it has died recently and nothing will help us to revive the dead body.

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Hahahaha Dadadada: About Childisch behavior and Decadence

Wednesday, June 13th, 2007

This evening I talked with a friend of mine. He runs a business in Knowledge Management Tools. His brother-in-law is very rich and he was invited to visit him in Spain (Valentia). His brother-in-law owns six cars, a big house and a very expensive sailing ship but he is not able to sail.

My friend is an expert in sailing and he is helping his brother-in-law to sail his ship to Alicante. This weekend a huge sailing event is taking place. It is organized by Switzerland. They needed a sea so they made a deal with Spain.

Organizing the whole events costs 2.000.000.000 Euro (Tax money). To develop a sailing boat an investment of 20.000.000 Euro is necessary just to experiment. Building the ship costs much more (200.000.000 Euro).

Winning the race gives you status in the network of rich people. Larry Ellison the owner of Oracle is one of the persons who is investing billons just to win and another Russian billionaire is doing the same. Anderson made his money by creating and selling software to big companies and government agencies. The Russian billionaire just grabbed everything he could get in Russia. He not only owns a expensive ship but also the most important Soccerteam in Brittain (Chelsea).

Normal (poor) people can watch the race on television and rich people don’t even watch. They have their private parties and my friend is invited. I advised him to find somebody that would buy his environment just for fun.

His Sister-in-Law shows strange behavior. She is wasting enormous amounts of money (six cars) but she also looks at the small things. She is “pound foolish and pennywise”. Her main interest is faking the luggage system of the airplane. She does not want to pay more than the normal fair and she has developed numerous tricks to fake even the customs. She is an expert in smuggling. She acts like a big child and she does not knows she is playing with fire.

My friend is an analytic observer and he observes the same thing in government projects (also tax money). His tools are very cheap and very advanced (Open Source) but Government Agencies and especially Government Research Organizations are spending billions to create something that is already available for free.

Rich people don’t pay a lot of taxes. They pay advisors to find holes in laws and the advisors advise governments to create holes. If they don’t do that the rich people move to other places in the world. Switserland is the expert in “helping” rich people. Banks are doing everything you want to do secret things with your money.

Last night I was asked to help the sun of a friend. He was having troubles with mathematics. I am a mathematician. (Not) to my surprise I found out that his problem was not insight but just doing something at school. He was spending all his time with friends, making fun in school and he did not spend a minute to listen to the teacher or to read his book. I couldn’t do anything to help him.

My friend also wanted to talk about the “career” of his sun. He had to make a choice and after some debate I found out that he wanted to become a banker. I have worked for a bank and I explained him what bankers are doing. He wanted to work in the money-market. I told him economics or mathematics is needed. He understood that his behavior in school was not helpful. After some debate I found out that he did not want to become a real banker. Banking was about doing nothing, driving big cars, nice suits and having fun. He just wanted to be rich.Unfortunedly his father was not a rich person so the only thing that was left for him was to play the lottery.

What is happening?

What is happening is called decadence. We are so rich that we don’t know what to do with our wealth.

But we are also very stressed. Why? Because we are convinced we have to work to make money.

To employ people we give them fake-jobs. Many jobs are about advising the advisor. This is a well know play in the Netherlands. Behind every teacher (we have a shortage, it is not paying much) twenty people are advising. Behind every nurse (and we have a shortage, it is not paying much) there are twenty advising. And it goes on. There are advisor to advisor and at a certain point they create a loop. This loop causes complexity and we employ advisors to make it simple and a new complexity arises. In the end we don’t know what is happening, we get stressed and we employ advisors (ok I stop).

It’s like a strange dream and the dream can turn into a nightmare when the system collapses (and it is collapsing) and suddenly we don’t have enough electricity (Fall-outs happen) and the trains are not running (They do).and computer systems are going out of control (They do) The advisors know that the reason is complexity but they don’t know how to solve it.

Dada or Dadaism is a cultural movement that began in neutral Zurich, Switzerland during World Ware I and peaked from 1916 to 1920. The movement concentrated its anti-war politic through a rejection of the prevailing standards in art through anti art. The movement influenced later styles, movements, and groups including Surrealism, Pop Art and Fluxus.

The artists created art out of junk and shit and made a fool of the governing class. Surrealism uses the Dream World to show how the elite is behaving. The “leader” Andre Breton was trained in medicine and psychiatry. He used the psychoanalytic methods of Freud with soldiers who were shell-schocked. He admired anti-social attitudes and disdain for established artistic tradition. He hated them and wanted to show the fake and the nightmares of poor innocent people that were fighting a useless war that was all about Power and Status.

Now the rich persons are paying millions to buy a piece of shit of Dada.

Andre Breton is laughing in his grave and the rich people are laughing also because they also have fun.

Hahahahahaahahaha

Dadadada. Childisch Behavior.

Decadence.

Are we watching the End of Western Civilisation?

I don’t know.

The rich have all the money and therefore the power to stay in power.

The children watch the Jet-Set on Television and also want to be rich.

If they are very poor they Join the Army.

Loop.

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Why Crazy people Always Win a War

Friday, June 8th, 2007
In the New York Review of Books of this month (June 2007) Robert Cottrel reviews the book “A Russian Diary” by Anna Politkovskaya. She was a very famous Russian journalist who was assassinated October 2006 in Moskow. 

Anna had the Guts to oppose Putin. The book is about him and the current situation in Russia. Robert Cottwel is very negative about the way the West is treating Russia. They need the oil and gas and don’t see that a possible world-wide war between Russia and the West is near.

The story about Russia is very frightening. Putin is a brilliant manipulator who is combining all his old skills (KGB), his almost total power and the underlying aggression in Russia to “Take Revenge”. 

I want to focus on one aspect in this article. It is about Kayrov the President of Chechnya. He is appointed by Putin. Anna interviews him. She finds out that he is completely crazy. He loves to kill and torture and he is very open about that.

Later in the article we find a small poem that was published in Russian Newspapers. The poem is about taking over Estonia. This will be easy “Who in NATO cares? .. They are Cowards,… in the end we will strike and make a deal with those greedy pigs. Who will sell their mother for gas”. 

With this in mind I thought about the Ethics of War.

Question 1:  What is Ethics?

The definition of Ethics is simple: Things normal people don’t do in a normal situation. War is not normal so you would say ethics is not possible but soldiers are normal  people that are trained to experience war as normal. Soldiers are tested and trained to behave normal. Crazy people are not hired. A soldier can become crazy because of the war-situation and kill and torture innocent people. We, in The West, are doing are utmost best to prevent this.

Question 2: What is Crazy (Not Normal)?

This question is easy to answer because craziness is like all diseases standardized by psychiatrist. It is just a matter of answering a few questions and the treatment and the pills comes out.  

A theory that explains mental illness is called Interpersonal Theory (See Horowitz.L.M, (2003), Interpersonal Foundations of Psychopathology).

People interact and in the interaction they show expected behavior. If a person shows standardized behavior (he is not flexible) he is “MAD”.

An example of highly standardized not flexible behavior is Paranoid. People always react according to the same rules.

Crazy people are people that are like computers; they are programmed.  They don’t see, feel, or hear the Other. They are alone in the universe. They love to kill and torture because they and not able to be empathic. They look at their victims and have fun. They hate their victims because they look like greedy pigs who will sell their mother for gas and they love their mother. 

Why are  the soldiers of NATO cowards? The answer is simple because they are normal and most of them are empathic. They flip when they realize what the others have done to their friends, their comrades.

Now I know why the story about Russia is frightening. Putin is mad. Perhaps he is even paranoid. He wants to restore the old Russian Empire. Like all his Predecessors.

He knows that the West is totally dependent on energy and he plays with them. He gives the greedy pigs the food they want. He knows they will negociate to keep their wealth.

What he does not realize is that in the West people can become crazy and some of them are in the Army. When they are brutallized till the end they flip and they will use non-normal highly destructive weapons. If this happens we are in Armageddon.

Perhaps we have a chance when we change our selection policy of soldiers and select real crazy people.

This will frighten Putin.

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Whats wrong with doctors

Monday, May 21st, 2007

Last night I read an article in the New York Review of Books (May 31, 2007). The article is called What’s Wrong with Doctors (written by Jerome Groopman, a cancer specialist).  The article (and the book) is about the current Medical System. It shows everything that is wrong with this system.

The most important problem, according to Groopman, is that doctors Think. This problem is enforced by the fact that they don’t take the time to listen to themselves (introspection) and their patients. The doctor is acting as a “Rule-Based”-system that acts on the variables that are put into the system. He sees what he wants to see because his focus is on “fast delivery” of a solution. The patient is not important. He or she is just “a mean to an end” and the mean is making a lot of money in short time (“efficiency”) and/or achieving status.

Groopman attacks “Evidence Based Medicine”. This approach is based on statistics. The whole problem with statistics is comparable to the “rule-based-system”-approach. Again statistics just shows what you want to see. Statistics is a method to find patterns but the problem with patterns is that there is an infinite amount of patterns possible in every situation. In statistics you have to choose a “pattern-type” (for instance the pattern is linear) otherwise the whole approach is not working.

Groopman shows that statistics make doctors lazy. They trust somebody else (the bright guys) and don’t think for themselves anymore. Doctors have to be “lazy-thinkers” because they don’t have the time to think because they have to produce fast-solution. So the problem is not that they are thinking but the real problem is that they are not thinking at all. They are acting as robots.

The pharmaceutical industry helps doctors to deliver fast solutions. They provide super-pills that solve everything. They provide doctors directly with corrupted information about the huge statistical effects of their inventions. To make the doctors happy they also provide them with gifts (luxury tours disguised in a conference).

The above is just the start of the attack on the medical system. Groopman digs deeper and shows that the fundamental problem is that we cannot fully understand the context of the patient. Everybody patient is unique and has a unique solution that brings him in balance.

Groopman shows that knowledge (thinking again) is a big burden to understand a context. Knowledge acts as a filter. Knowledge shows just what it knows. This problem is related to the doctor and the patient. Both know something (I’m having a problem, I can solve the problem) but their “knowing” shields the real context.

How can we ever solve this problem? The solution is really very simple. We can solve the problem by “not-thinking”. If we are “not-thinking” we know everything. Deep within us (in the great unknown) lays the solution waiting. We don’t want to know this solution because it will destroy our patterns and patterns are what make us feel comfortable.

The patient knows the solution already and wants conformation from a loving and caring person who gives him the confidence that his process of change will get him in a new balance.

The best caretakers are not found in the medical system. They are good friends or people with the gift of healing that can support the person to make the “unknown” know.

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