Monday 31 August 2020

Postscript: We Got Those Algorithms!

Had to smile when this little ad popped up over one of CU's recent pieces where we have been wondering about the fate of commercial property.

Perhaps the algo detected those of the BTL comments that were upbeat!  Because let's face it, some of them weren't ...


Sunday 30 August 2020

Saddam's Sortie (Part 2): The Iraqi Army of 1990

Armies, it is said, prepare to fight the previous war.  Well, the British military in 1990 wasn't exactly primed for WW2 or Korea**, but it was pretty much characterised by its Cold War stance - and not unreasonably so, seeing as the Wall had only come down the year before and the Soviet Union was still intact.  No apologies, then, for (almost) all our studies being directed towards the Russian military, which we felt we understood pretty well.

When Saddam made his move on Kuwait 30 years ago, with the UK squarely alongside the USA in plans to send him back home with a size-10 Boot DMS in his arse (and Drew back in the Queen's pay to do his bit), we Russia specialists had quickly to get to grips with two new subjects for rapid study: a new geograhical theatre, and a huge, combat-tested army that frankly we'd never given any real attention to.

Saddam's substantial army had been engaged, more or less non-stop, since he invaded Iran in 1980 (he had form as regards invasions).  Wiki has it that the Iraqi army numbered some 200,000 at the outset, and lost "150,000 - 500,000" over eight years of attritional conflict.    Whatever the precise facts behind these arm-waving numbers, by the time of his Kuwait adventure Saddam had at last half a million men in arms, very many of them with combat experience and not a few with genuine, local, hard-bitten war-fighting expertise - a pedigree not to be dismissed out of hand.

So what did we know about them in August 1990?  Clutching at straws, we knew they had some fairly strong British Army organisational antecedents and traditions (directly so, up until their revolution of 1958); and that they were largely equipped with Russian kit.  So maybe they used, errrr, a combination of the British and Soviet military doctrines in which we already considered ourselves well versed? 

Yup, clutching at straws.  There was nothing for it but to knuckle down to some serious study of the Iraqi Army in the salient period 1980-1990.

And we quickly discovered that, whatever were the inputs from more prominent modern armies (happily, Russian doctrine well to the fore), there were a number of Iraqi specifics to be learned about.  Under the intense Darwinian pressures of that formative preceding decade of life-and-death conflict with Iran, the Iraqi army had come up with some genuinely interesting military innovations ...   (TBC)

** Mrs T, of course, was dead keen to re-fight the Falklands war

Friday 28 August 2020

Boris maybe try to push 'back to the office' but big companies have their own commercial decisions to make

 Big companies face a dilemma more than small companies. With a few people a few changes to working practices and your off, plus some can work from home or a rota. May not be easy but is not too hard to organise.
However, the cost of say changing your 5000 person shiny Canary Wharf HQ to be covid safe is in the millions. Plus capacity will reduce by 30-50% anyway - so working from home for many will continue whatever the Government or the bosses want.
Then if covid recedes you have to undo many of the changes again to get capacity back up.
Why bother? You are paying the rent anyway and demanding reductions from the landlords. Just sit it out another 4 months, see if covid goes away. The Bank/Accountant/Agency etc has survived this long, maybe even thrived. If the virus does disappear then great , everybody back in 2021.
If it does not, then oh dear, time to tell the landlord the end of the world is nigh and we are not paying our rent (the landlords go bust with this plan, so rent is never paid in full, the banks foreclose and have to negotiate fractional rates to get the money back on their debt). We wont be needing large offices for a while in that scenario.
So I can't agree with the Government push on this, it makes so little sense for large companies to push for return to work. It is happening a little anyway. France and Germany where they have pushed this have seen a big increase in infections - maybe the conservative british management has got it right?

Thursday 27 August 2020

Exodus 20:20 - London

The Exodus | Art UK

 And so came the time of change upon the land. 

Ravaged by plague and the mass of humanity seething in the Metropolis. 

The welcome to strangers had pushed the sinews of London to breaking point. 

Mayor Khan, for it were he, enjoyed his state patronage, but was happy to see the City fall to ruin assailed by vagabonds, for he did not like King Boris and was happy too see his realm fall into anarchy.

But the people of London were discontent, they did not like the anarchy and the did not like the plague.

At first they stayed in their homes, awaiting the dark times to pass. But the dark times did not pass. 

So eventually, they began to leave. The newcomes could have the anarchy, the Londoners wanted it no more. They wanted the promised land, the land of the shires, where there was not anarchy, where there were green fields instead of burning concrete buildings and where they could hope to escape the plague. 

The Exodus had begun. 

(This post is inspired by my Estate Agent friends who assure me that currently any house in the home counties is selling at asking price within a few days of going to market)

Wednesday 26 August 2020

Saddam in Kuwait, 30 Years On

This month sees the 30th anniversary of Saddam Hussein's lightning invasion of Kuwait.  You won't find much mention of that in the MSM, but I haven't forgotten ...  and I'm rather hoping the 30-year rule will see a deluge of official material being released and declassified at Xmas.  Because unless that happens, I'm a bit limited in what I can write about it.**  

Back then, it quickly became evident the US under Bush Senior was wholly determined to retake Kuwait, by force if necessary; and that the Brits would pitch in strongly  -  Mrs T, beleagured by the Poll Tax fiasco (Michael Portillo, where are you now?), was still PM and had long been looking to replicate the Falklands Factor.++   

In 1990 I was a reservist.  The rules for mobilisation of reserves in those days were very restrictive (the later conflicts of the 1990s saw them greatly "relaxed", if that's the right word) - it could only be ordered if the UK itself or NATO was under a concrete military threat to its own territory.  However, I was a specialist and the rules had long since been waived for us, on a volunteer basis (I have no idea whether ministers had been informed ...).  And the cause was just.   

Also, at the time I was working for a US oil company(!) who were, *ahem*, entirely supportive of releasing me for a while.  There was an immediate ramping-up of UK crisis plans, which called for the rapid build-up of various normally dormant HQ operations.  Partly this could be achieved by switching regular officers out of their peacetime roles: but it was also handy to have suitably qualified reservists available.  I had the experience - and a high security clearance.  So, back to the Colours I went ...   (TBC)  

** The UK is considerably more paranoid conservative in these matters than the US - tons of juicy stuff has been declassified on their side if you know where to look:  but we're not allowed to confirm it

++ History Corner has another story to tell on that front ...

Monday 24 August 2020

A Blizzard of Straws in the Wind

A month ago I wrote, rather unoriginally, that Recession is a-Coming, and mused on the prospects for property prices.  Lots of people pitched in BTL: well, it's a subject that affects most of us, one way or the other (or both).  Some even wondered if property might be counter-cyclical ...

Yesterday I met with an old friend, a solicitor who's semi retired.  His staple line of business these days is advising employees on settlement agreements (formerly 'compromise agreements') which when you think about it is a nice speciality:  you get paid for by the firm that is making your client redundant, so credit risk is almost zero.  And I rather imagine the content of said agreements and the issues they address are fairly standard, too.

Anyhow, for quite a while now his average throughput has been a congenial 2 or 3 agreements a week.

Last week he was sent 82 (eighty two) ...  I believe this is what is called a leading indicator.

Oh shit.


Friday 21 August 2020

Our new £2 trillion debt

So we know Covid-19 is not nice and has caused the UK Government and indeed the whole world a lot of problems and lives.

What is really shocking though is the economic cost. Throughout the pandemic economics has taken a back seat to protecting lives in most countries. Especially, the UK with its NHS worship and fast growing numbers of left-wing nutjobs, is particularly nervy - not that it saved us from being one of the worst affected places to date. 

But the economic numbers are brutal. Now we have £2 trillion in UK debt, albeit £745 billion is  QE debt which is owed by the Government to the Bank of England, which is sort of owns anyway. This equates to a 100% debt to GDP ratio last experienced in the aftermath of WW2 and economic catastrophe. 

Worse is that Government spending continues at £27 billion a month, already this year we have spent as much as we did in the whole of 2009 or 2010 - the height of the Financial Crisis and its costs. But is is only August and the furlough and money spending continues. 

All with an economy that is currently 20% smaller than it was, even if this bounces back in future months we will end up with an economy at least 5% smaller for the next few years. All those airlines and small retailers are not coming back quickly. 

There is no evidence that I can see that the Chancellor Rishi Sunak is going to apply the breaks, nor that the Prime Minister can awaken the country when all the talk is of second waves and a terrified populace. 

So by the end of next year, there is not way we won't have £2.2 trillion of debt - a 20% debt increase in the space of 18 months - unheralded outside of a major war. The only positives are thing slike furlough are easier to cut, but benefits for the unemployed will rush in to keep the Government spending. 

All that austerity and the political and personal costs of it has been wasted away by this new black swan event. the whole 2020's will repeat the 2010's in terms of economic exprience - little money for Governments to spend, creaking infrastructure and whining people asking for subsidies that don't exist.

There is a way to reduce this, which is to rapidly end government support that will force people and companies back to work - but there is no backbone in the government to do this and the ever present fear of a second wave stops this. 

Wuhan Holds Huge Concert Pool Party After Three Months Of No ...

I saw pictures of a huge gig in Wuhan this week, not much worry about a second wave there I note. 

Thursday 20 August 2020

Muddying the Waters in FB ... and Moscow

Today we read that Facebook intends to merge, in systems terms, various functions across various of the platforms it owns - FB, Instagram, WhatsApp, Messenger, etc - in order to make it harder for regulators to split the company up, Standard-Oil style.  (Google, incidentally, spotted this wheeze a long time ago - and it cost them an astonishing amount of development $ to achieve.)

Reminds me of a similar but lower-tech story from my days in Moscow.  Gazprom, inevitably, was my main counterparty and I was in their fine new offices a lot.  My Russian staff used to get me to buy fresh bread rolls from the canteen there - the Moscow City bakery only baked twice a week, but Gazprom's operated every day! - and to make this easier, they procured for me (I never quite knew how) a Gazprom pass ...

I was professionally very keen to get an accurate company organisation chart for the sprawling giant.  I was supposed to conduct all my dealings through the Protocol department, but after I got a bit of a presence in the company, people would just invite me in for a chat (out of sheer curiosity, as much as anything: I didn't conduct my affairs in quite the same way as many expats).  I had several memorable (and quite candid) encounters that way, which may be posts for another day.

Anyhow, I asked for the org chart, and was given this bizarre diagram, several times more complicated than the tube map of London, with dotted lines criss-crossing everywhere.  It was of course designed to indicate that there was no such thing as a modular division within Gazprom, oh dear me no: nothing that could be identified as a candidate for breaking off and floating separately - a fate which Gazprom dreaded.  (It was complete bollocks, of course, there were loads of meaty corporate chunks that could easily have been autonomous.)

This wasn't getting me very far towards understanding the hierarchy (which, in Russia, is an extremely important thing to do - КТО КОГО - who does what, and to whom?, the first thing you need to establish in any dealings with a Russian set-up).  But having studied these matters in some detail in my soldiering days, I knew there'd be an answer; and I had my resourceful staff procure me a Gazprom internal telephone directory.  The numbering system set it all out clearly ...  


Wednesday 19 August 2020

Raedwald: You Can Just Picture Him Now ..!

Here's Raedwald!  Courtesy of Ilia, who kindly wrote to us BTL this morning, and also stars in this picture with her Uncle Mikey.

Many thanks indeed, Ilia.


Tuesday 18 August 2020

Raedwald RIP

Radders was a great friend to this blog, and I trust we were to him.  I never met him in person (he was due to attend one of our Xmas drinks but for some reason he didn't make it) - but we'd definitely have enjoyed a night over the beers.  His not having posted for three weeks caused disquiet - such a stalwart blogger - and it seems the worst has befallen.  If more details of his personal life now emerge, there's many of us who'll be interested to learn them.

From never having met the man, there is still much to be said from his consistent, colourful and extensive blogging.  He described himself as an irredeemable optimist but was also clearly a fine conservative, and the two traits don't always coincide.  A massive supporter of localism and the wisdom of Burke's Little Platoons, he was also a good European - warmly espousing catholic internationalism but despising globalism in general, and Berlaymont in particular.   As firm as he was in his views, he was also ready to acknowledge mistakes, and man enough to leave them up online for all to see (none of the nasty, furtive re-writing of a Redwood or a Cummings). 

Raedwald had principles, alright: and he was clearly also practical to the nth degree.  You just know he was a man you'd want on your side in a fight: the supremely handy sort who'd rebuild the world after an invasion of Triffids.  At the same time he was clearly of a philosophical bent, his abstractions coming from a solid and wide-ranging empiricism in the best English tradition - an empiricism based in turn on his quite remarkable range of richly-enjoyed experiences.  His tales of Human Reality came from rural East Anglia and the boatyard; from the tough world of quantity surveying and project management at the sharp end of the building trade; and from hardcore bohemian Soho!  Firmly grounded, widely experienced real-world thinkers like Radders give one all the more contempt for the malcontent bedsit lefties with brains the size of planets, who clearly couldn't change a three-pin plug, yet who cultivate gigantic Hegelian fantasy-systems on nothing more than instant coffee, envy and bile.  

We needed Radders for some important fights yet to come.  Much of the UK Left is currently in a slough of despond, having childlishly invested everything in Corbyn.  They seem to despair of pretty much everything just now: but another, less fragile part of the dark side is limbering up for a massive assault on free speech, hoping to subborn the universities, the television, and ultimately social media - one all can too easily imagine platforms trading off the freedoms of expression they currently facilitate for their own freedom to make money.  (They are businesses, after all.)  And then there are the supranationalists ...   

Radders, despite attracting some very odd BTL traffic, maintained a stout line in critical commentary that was extremely valuable to us all.  We'd already lost Anna Raccoon: and now there's one fewer voice to speak truly and plainly in the culture-wars ahead.

How I wish he'd joined us for those beers.


Monday 17 August 2020

Greta: Now Surplus to Greenie Requirements

The entire Greta childrens-crusade thing is a fascinating story: one day the whole thing will perhaps be truthfully told.  (Or not.  There appears to be some evidence - some would call it conspiracy theory - that she is 100% a carefully-contrived PR exercise, right from her first solo sit-in.  In this account her mother basically handed her over to shadowy "green" forces to do with as they pleased:  there's a word for that ... and a lengthy prison sentence.)

Anyhow, as you know, I reckon "she" contributed just a little to the great Story of 2019, the Year When Zero Carbon Went Mainstream.  It wasn't her doing; nor was it XR's: but they are all definitely part of the overall canvas (along with the panic-stricken Theresa May and whomever it was told her to rush that Net Zero Carbon 2050 Act through, who may yet get a lot of "credit" when the history books are written).

But now?  Greta's contribution to recent climate debate has been characteristically petulant, if not paid as much heed as last year; and it's interesting.

She is now drawing attention to the rather obvious fact that, notwithstanding 2050-style legislation around the whole western world, climate change is not being treated as an *Emergency* (as all those silly motions passed in debating chambers around the world would have it) - and we know this because we've just seen how people respond to a real emergency, Covid-19 being the case in point.  She was hoping that everyone by now would have voted for the complete lockdown and trashing of the world economy - for Climate reasons.   Much stamping of little foot and blinking-back of tears: but there it is.  She's nailed it.  We know it.  And nobody's really listening anymore.

So what is happening?  Back to my "2019" thesis.  The 2050 legislation across the western world is exactly the icing on the cake that confirms to the whole world's industrialists and bankers (and con artists, political parties, kleptocrats, organised criminals etc) what they'd already decided 12 months ago - that this is the only game in town, now given a sturdy touch on the accelerator by all the multi-trillion Keynsian "Green Deal / Covid recovery" schemes now being drawn up.  Helpfully, these include lots of basic infrastructure renewal for "adaptation" / "mitigation" / "resilience" - so even the big, traditional steel-n-concrete boys are invited to the party, much to their amazement & delight.

Coupled with this "mainstream capitalism" development - not quite what many greens had in mind, hahah! - the Left is developing a response of its own, which also isn't exactly what the greens hoped for.  To take the UK left as an example: as noted here before, the Labour Party's apparently rather comprehensive version of the Green New Deal is quite strong on the *Just Transition*, which in classic workerist fashion turns out to mean that (a) everything must be implemented by a unionised workforce, and (b) anyone currently in a dirty job must either be granted a shiny new clean job / apprenticeship / etc, OR left doing that job for as long as it takes to come up with a transition plan.  Lefties in other countries  take similar stances: and hard lefties take a very tough & uncompromising line on priorities.
Green New Deal advocates and the wider Left should factor into their plans the need for a just transition to a post-extractivist society ... This must be an absolute red line, even if it threatens decarbonisation targets [their emphasis]
Like I said, not quite the red-green alliance thing.  Indeed, XR itself is deeply out of favour on the hard left (all those middle-class white XR types being racists, dontchaknow?); and lefties now tend to identify + despise what many a rightist has long railed against - Ecofascism.  Doesn't have the correct marxist interpretation of exploitation, see?

And Greta?  Well, if you believe the conspiracy theory, she is fronting for a cabal of NGOs who plan to use the Climate impetus to institute a World Government thing that - wait for it - will take it upon itself to issue extraction licences on All The World's Natural Resources, for licence / royalty fees that they will (a) lay claim to for their nasty world-government plans; and (b) take a % on, for themselves (of course! - Gulbenkian on a scale hard to imagine; they are nothing if not ambitious). 

They may, of course, get trampled in the rush - because every industrialist, bank, con artist, political party, kleptocrat, organised criminal etc on the planet has similar designs ...


Private Equity firms ask for UK bailout - a way to make this work

In news that is unsurprising, Private Equity firms have joined the rest of the UK economy in demanding some Government handouts of free cash. It is all the rage after well, even Football clubs like Wigan have been demanding free money to help them survive (in Germany, they have bailed out Schalke 04 and Werder Bremen already, incredibly). 

PE firms have a PR angle that says they employ a lot of people and the firms they maange will go to the wall if they don't get help, so costing a lot of jobs....but why might these firms go to the wall?

A - PE firms took big bets in recent years on retail, see the margins for turning around a struggling industry business could be more than 20%. Covid has ruined this position so now PE firms are saddled with bad investments. 

B - PE firms generally buy companies, load them with debt, pay it off and then sell of float them. OK, they claim to add some management pizzazz and to some extent it is true as occasionally they will invest in new IT or some such to improve operating margins to reduce debt, but not too often if they can help it. Now their investments are saddled with debt that will be hard to even service. A nice Government bail-out will save their equity position will help to keep the companies alive. 

However, the Government is in a bind, it has huge pressure on it not to bail-out companies based in tax havens, so many US PE firms with their Cayman or BVI structures will be challenged. Also, at some point the accountants who advice Mr Sunak are going to have to give him the bad news about running out of our grandchildren's money. 

But if the Government is going to be bribed into going down this route anyway, I can suggest a few tweaks to the investments that will enable them to work in the medium-term:

1 - Wipe out chunks of the PE equity in return for the bailouts, it is only fare the investors take the hit here. The PE firms should be allowed to remain in, but if a business is saved with state money, then it should turn any future profit back to the State relative to its investment level. 

2 - Insist with this debt for equity swap, that there are strong leverage limits for total debt. There is no point lending to companies saddled with so much debt that they are zombies and unlikely ever to be able to repay. Remember too, much of this debt is effectively profit in advance taken by the PE houses anyway.  We don't need more RBS type investments where decades will pass before breakeven. In the Covid era, 100% debt to turnover or more should be a no-no. 

3 - Be tough, change the above criteria dependent on industry sectors, bailing-out retail leisure is high risk and thus should be high reward, bailout of say a bank is less risky in this particular economic crash. 

4 - Size does not matter, just because PE have bought a big bet, does not make it better than a smaller company. Small companies are the bedrock of our economy, they should have access to bailout investments too.  

Friday 14 August 2020

The trouble with Algo's

Algo's have been all the rage in the financial markets now for the best part of three decades. As far back as the Long-Term Capital debacle of the mid-1990's, through to the flash crashes and algo driven 2009 crashes and thence on to "flash boys", it has been all about the algo's. 

But in recent years, they have topped out a little - admittedly because in part they are the only show in town. Still, Hedge Fund launches have been tailing off for a few years and this year there is no real change. Perhaps some optimism that a recession will see an uptick, but nothing as yet. The main driver of this has been that a generally rising market has meant the much cheaper buy and hold strategies have paid better than expensive hedge fund algo trading - which is prone ot making racy bets and trying to corner markets against the trend. 

So it is not surprising that now Government's are following the lead and using Algo's - in the UK Dominic Cummings is a big fan. if it works for high finance, then surely it is a good idea for Big Government. So when a challenging situation appears like the A-Level results all needing to be modelled out of the blue, here is an Algo solution which has found its problem. 

Yet it has not worked out to the Government's advantage, overall the results are likely very fair, but individually there are thousands and thousands of errors. Each error is a person with hotline to social media and the wider world. Each one is aggreived and a victim, all have parents behind them saying little Jenny or Jack worked all the hours god sends, is very clever and deserves at least a place at Oxford and not Salford.

So basically today ends up being an Algo catastrophe, much like in the trading world, where getting 99% of your bets right but shipping all your profits on the 1% higher risk postion that cratered ruined your year. Here most results are likley fair, but the numerous injustices willl be impossible to justify. 

Here begin the opportunities and pitfalls of real technocratic governance. 

Tuesday 11 August 2020

End-Game for Leftie Councils' Energy Adventures

Starting around 2015 or a little earlier, various local authorities started to get interested in becoming energy suppliers on a "social", Not-for-Profit basis: how hard could it be?  After all: cheap council capital; subsidised offices; no dividends to shell out; "no bonuses" to pay (well, no bonuses for the directors: you can't get experienced commercial energy staff without a bonus scheme) - we should be able to undercut the Wicked Big Six all the time!  Easy.

The bollocks it is.  And most of the local authorities that looked into it properly, and took proper advice, realised their error and quietly withdrew without spending too much to make it embarrassing.  These included Sadiq Khan's London, and Nicola Sturgeon's Scotland (amazingly enough).  Credit where credit's due.

But two councils wouldn't be stopped.  They were Nottingham, which set up Robin Hood Energy, and Bristol (the imaginatively named Bristol Energy).  Both were doomed from the start; though in zombie mode and each with access to council-taxpayers' money for a protracted series of bail-outs, they have both staved off the day of reckoning until now.  Yes, you can suspend the laws of gravity for just so long as you are willing to through cash at it.

Bristol at least tried to do it somewhat professionally and organically, with some basic financial disciplines in place, and a target of being profitable within 3 years.  The current mayor, an engaging moderate leftie (for whom I have some regard, actually) inherited it in 2016 and should have pulled the plug there & then.  But hubris plus taxpayers' money somehow carried it all through until the cash calls and the write-offs became just too big.  He called time a few weeks ago, and (as David Morris, one of our BTL regulars spotted) a buyer has just been found for the portfolio of business customers (for a pitifully small amount) - see comments under Monday's post.  Based on the ugly fate of Cooperative Energy last year, it's my guess Bristol will actually have to pay someone to take on the rest of the obligations and the residential portfolio.  Aside from the inevitable dissembling and secrecy from the mayor's office in the last few months of this doomed enterprise, Bristol wasn't conducted outrageously; just badly misconceived.  

By contrast, Robin Hood Energy is a shocker.  An outright leftie vanity project that boasted of having Corbyn as a customer, and of being the vanguard of a new wave of municipal socialism, Robin Hood was to be a NfP - a sure guarantor of being a stonking loss-maker, which it is.  The prime movers were doctrinaire Momentumites; and if I tell you the Chairman of the Board of Directors (a councillor) was also Chair of the Audit Committee charged with monitoring the company on behalf of the council, you won't be at all surprised.   Their USP was offering their services on a "white label" basis to a dozen other leftie councils (a ring of other pig-ignorant Momentumites - but at least with the nous to avoid becoming suppliers themselves, hahah!) the length and breadth of England.  With this rapidly expanding but massively loss-making buiness model, Robin Hood has been bleeding the council tax-payers of Nottingham white (robbing the, errrr, poor to pay the, errr...).  The statutory auditors have now called a halt, to much wailing and gnashing of teeth: it'll all get "sold off" quite soon (i.e., they'll pay someone to take it away).  It's pretty comical - if you don't live in Nottingham, that is.

In the meantime ... a truly bizarre thing happened late last year.  A very iffy, loss-making small Glaswegian supplier, Together Energy, somehow conned Warrington Council into paying the £18m for a half-stake in the company! (plus more millions in loans).  What they hoped to gain from this is anyone's guess: and their Due Diligence must have been utterly perfunctory and conducted by a rather dull form of invertebrate life.  It's so crazy, many would wonder if it was bent - except I think "crazy" is in fact the explanation.  Not only are the books very odd indeed; but by mid 2019 the writing was on the wall for Bristol and Nottingham in large bold characters and no uncertain terms.

Here's the thing.  Rebecca Long-Bailey, queen of the left, published a strategy still greatly lauded on the left, for nationalising all of energy and putting it into the hands of local authorities and indeed parish councils and 'local communities of at least 100 homes', all to be heavily unionised etc (we've written about this before).  With these stonking examples of municipal idiocy, secrecy, incompetence and gross failure in even the simpler side of energy (being a supplier is a lot easier than running a distribution network, with a lot less at stake), WTF is she thinking?  That's a serious question.  

It ought to be a sober lesson for all: but we know it won't be.


Monday 10 August 2020

The Blackbaud Affair

A nasty little problem - you've maybe encountered it already - that's been creeping its way around the Not-For-Profits relates to the fact that, apparently, a high % of the sector uses Blackbaud CRM software.  I presume it's cheap.

And insecure.  For Blackbaud has been held to ransom by someone who's hacked it, and made off with its users' clients' details.  On a pretty large scale, it would seem.

A couple of interesting aspects.  Firstly, this has been known about for weeks.  But the speed with which Blackbaud's users have 'fessed up to their own clients has varied tremendously.  Very much a laggard in this regard is ... the Labour Party, who've only just acknowledged this to their members whose data had flown the nest.  Why so coy for so long, Mr Starmer?  What bad-news-management mode were you in when they first told you about it? 

Of wider import: Blackbaud gaily tell the world that "they have paid the ransom demanded by the cybercriminal and have received assurances that the data was destroyed as a result".  WTF?  Are those affected supposed to believe assurances from, errr, acknowledged criminals?  Why wouldn't said hackers not make multiple copies and sell to whomever will pay?

Or is there a binding international Ransom Protocol I've never heard of, with ISO standards for conduct, arbitration in the Hague, and certification by General de Chastelian?


Sunday 9 August 2020

Deafening Silence as Left's Worst Nightmare Becomes Reality on the Streets of London

I've been away for a few days but, having seen the shocking photos of the "FF Force" paramilitary march, I assumed the www would be awash with commentary.  Well yes, there's the predictable Daily Mail / Guido type of comment: the law prohibits paramilitary displays, so what's Commissioner Dick gonna do about it?  That kind of thing.  (And quite right, too**.)

But on the Left?  Nothing.   This is a genuine question: can anyone point me to even a story about this incident / phenomenon in the Graun?  Or a comment on it, from any "mainstream" leftie type on social meeja or elsewhere?  Because I can't find one.

Why?  Obvious.  This is the "academic" Left's worst nightmare.  Much as they tend to swoon at the feet of a Gerry Adams++, or a militant Islamic preacher, or indeed anyone who's actually willing to use violence for political ends (which they kinda wish they were, too), in today's "culture-war" context, they know this one is the finishing of them.

For just as Kier Starmer knows that if Labour becomes clearly identified as the party of Trans Rights he is doomed to lose even more RedWall-type votes, so equally if it becomes identified as the political wing of FF, it's all over for 2024.   The basic consensus on the left is that the Labour Party's bedrock has ceased to be the traditional "working class" of Everytown across the whole UK, and has become the multi-culti "new worker" yoof-oriented populations of the Big English Cities (- which, they think, isn't even a vote Labour can take for granted, any more than the RedWall voters were locked in).  

What's more, it's nowhere near a parliamentary majority for them - they need an alliance with other "progressive" demographics - county town greens and libs, or even not-so progressive C1C2D's - the sort they felt they already had.  The prospect of such an alliance evaporates the moment they are even loosely, (even unfairly) associated with FF.  Incidentally, what genius came up with that??  Nothing could more clearly signal it's an outright fascist venture - probably even a deliberate provocation as such.  Support us!  Even though we do this!

Nope: as a self-proclaimed anti-fascist movement, Labour must now categorically distance itself from FF.  There's no wiggle-room for a Sinn Fein style nod-and-wink; and we see that Starmer slams down heavily on nods-and-winks on the antisemitism side of the house, so I think we can guess his policy on this new one. 

And the Graun.  And Sadiq Khan.  And yes, Owen Jones, you too will need to make some clear pro forma statement on the matter (unless it all evaporates on Monday morning, as you'll be passionately hoping).  But ... what then for the multi-culti-"new-worker"-yoof-oriented-populations-of-the-Big-Cities vote?

This is Cummings' Culture War writ large and lurid.  (Did I say "unfairly" ..?)  It can't go well for any of us: but it bids fair to be the end of Labour.  Starmer knows it all too clearly - so he'll have some sort of a plan - though it may not be one the multi-culti Left will be too happy about.  Watch and wait.  Meantime, it'll be interesting to see this gradually break cover in leftie www circles.


** Knowing the way the security establishment works, BTW, I'd say they have a plan to handle this.  But sending PC Plod to invite a street demo to disperse peacefully, oh, and please hand over your uniforms on the way out, isn't any part of it.

++As Marina Hyde put it: You only have to look at the little faces of Jeremy Corbyn and John McDonnell in the photos with Gerry Adams to conclude that they’d have been almost erotically impressed by the whiff of cordite.

Friday 7 August 2020

Apple, Trump and Tik Tok/Wechat

The importance of Apple to US markets is huge. As one of the FAANGS which are 70% of the US market any large impact on its performance will create a downtrend the major US equities market. 

So the Trump administration's latest move to ban TikTok (owned by Chinese company Bytedance) and WeChat (owned by Chinese tech firm Tencent 0700 HK) has some serious issues in the current form. The executive order prohibits US entities from doing any business with TikTok and WeChat or their Chinese owners. 

Now virtually all consumer facing US businesses in China rely on Tencent for advertising and payments....and none is more exposed than Apple.

Approximately 70% of China's retail transactions are done through digital payments in China and of this ~50-60% is through WeChat. Furthermore the contact tracing app (required for entry in most buildings in China) also runs through wechat. So not having wechat in China literally means you cannot go anywhere, you cannot buy anything, cannot chat with anyone, cannot see all your friends social media.

China is Apple's largest market, the country generates ~17% of iPhone sales and probably a higher percentage in Appstore sales. The problem for Apple, as highlighted above, in China an iPhone without wechat is virtually useless.Therefore, in current form, and if Trump follows through and Apple abides by the law, this will literally destroy Apple's business in China and consequently have considerable impact on the markets. 

Wednesday 5 August 2020

The Troughers Never Go Away

We had decades of being stuffed by nationalised energy companies; then another decade when Ofgem was awarding subsidies to renewable energy projects on a non competitive basis.  The moment developers were made to compete for limited funds, the "costs" plummeted!   A miracle.  Glory Be!

But now the great green "economic revovery" bandwagon is REALLY gaining momentum, and lo! - here's Scottish Power.
In previous auctions the government has capped the amount of renewable energy that can win a subsidy contract, which is paid for through energy bills, to encourage developers to lower their costs. Keith Anderson, Scottish Power’s chief executive, said there was “minimal risk” to household energy bills [if the cap were to be removed] because the cost of sea-based turbines is so low the projects may even help to make Britain’s energy cheaper. “At this stage you are guaranteed fantastic value for money. And what do you gain? A huge wave of investment into the UK supply chain companies and a major boost to the economy,” he said ... “Why constrain investment when we could be making the most of what we’ve got to grow the renewables sector?” Anderson said. “We know that we need more renewables, let’s just get the hell on with it.”
Yeah, yeah.  Suddenly it would turn out that those low bids for subsidies last time around were before a big surge in demand for turbines took place; oh, and all the good sites ahve already been taken.  So, sadly, Minister, I'm afraid it's all a bit more "costly" this time.

Bloody troughers.  If the government gives them an inch I shall be sore displeased.  But not, I fear, surprised.  Has Boris ever turned down a building proposal put before him, as Mayor or PM?  It's not his style.  Some truly epic "waste" is about to be perpetrated and I am simply glad that the utterly ridiculous Swansea Bay Tidal Lagoon has, at least for now, been resolutely seen off by several ministers in a row.  The trougher behind that one hasn't give up, however - so let's see.


Monday 3 August 2020

Looks Like China Has Blown It

In the long run, not much can stop China becoming thoroughly pre-eminent  - if not necessarily the unchallenged global hegemon with complete freedom of action it aspires to be.  But in the short- to medium-term its progress could become a lot bumpier than the exceptionally smooth and untroubled run it has managed over the past two decades: and things might even go binary on China in a way it won't much enjoy.  

The acid test for Xi in my mind, and probably in his too, is Taiwan.  It's abundantly clear Xi wants his crowning glory to include the "re-integration" of Taiwan during his own regime, and has probably vowed to do this by whatever means.  But he'd doubtless consider the need to resort to violent re-annexation as very much second prize.  There must be many more examples of things he'd much rather didn't go wrong, along the way to the Chinese Dream being fulfilled.

Up until very recently, from the outset of the Chinese march towards their Authoritarian Capitalist successes, the Chinese have proceded emolliently, if not actually by stealth.  If Hong Kong had remained placid, one might have imagined this course would have been continued - just look at the gains they've made!  By all accounts they've pretty much annexed New Zealand as a mere commercial dependency, with Australia firmly in their sights and already well under the thumb.  In lockstep with the commercial hooks, the political grappling irons have also been steadily applied, along with bribery, corruption, and flooding with fee-paying students - little trojan horses by the tens of thousands.  There are any number of chilling accounts to be found, not least the way in which Chinese citizens abroad are monitored (and indeed directed) for their every action.  China does what it fancies with the Uighurs and narry a Moslem leader mutters a word.  We haven't even mentioned espionage, massive attempts to corner markets in raw materials, building artificial islands in the South China Sea, and implanting high-tech trojan horses in the UK's telecomms and electricity infrastructure.  But, for the most part, this has been achieved with only modest push-back, resistance, or even friction; and mostly (to be honest) grovelling, money-grubbing acquiescence.  (What an epic shit Osborne is.)

The sheer power amassed by Xi in every dimension is formidable indeed.  And with it, inevitably, grows the temptation to call a halt to the disciplined habit of swallowing pride, and turning the other cheek, when setbacks and annoyances occur, as China has chosen to do many, many times in the past**.  (Cultural obsession with maintaining "face" doesn't help much, either.)  So now Athens can no longer forbear from lording it over Sparta, and from forcing every other nation choose between the two++.

And look what's happening today.  The kow-towing era of Osborne / Cameron / May has come and gone.  The fates of Hong Kong and the Uighurs are a now serious issues around the (western) world, largely impotent even as we are.  Australia - yes, Australia, dependent as it is on exporting raw materials, is stirring against recent developments.  And there's talk in the air of Japan joining the Five-Eyes community.  That's of gigantic significance - Japan is as good an "unsinkable aircraft carrier" as the UK was vis-à-vis Russia, with a very desirable set of special capabilities.  Altogether a rather different turn of events in that neck of the woods than one might have anticipated a year ago, when much more likely seemed the expulsion of NZ for having been thoroughly subborned by China and no longer trustworthy (with Australia very much on notice).

What does China have to fear?  In the grand scheme of things: not much.  Trump could press the Red Button tomorrow: but the man holding the briefcase would smile and say, sorry Mr President, it doesn't seem to be working today.  Ain't nobody going down that path unless Xi does something unimagineably crass.  A few minor economic hiccups arising from unforced errors, perhaps (as opposed to the ones they are inevitably going to suffer along the way in any case). 

Most importantly, if Trump thinks the power of US sanctions will hurt China as fundamentally as they've hurt Iran, to the point where maybe he might dream of precipitating domestic unrest; well, I'd guess the CCP's web-enabled 100% Big Brother regime is more than capable of 'defusing' the social consequences even of some otherwise serious short-term economic setbacks.  Not many nations spontaneously combust during recessions anyway; and few have the kind of omnipresent, omnipotent fire brigade that Xi has at his disposal.

No: mostly it'll be delays to Xi's grand plans; infuriation as Taiwan shrinks ever further from contemplating a voluntary reunion;  plus, of course, Loss of Face as some of the global prestige Xi fondly hoped to deliver over the coming years evaporates.

That could be pretty bad for Xi personally - if only for his private equanimity: but he's just one man among a billion.  Objectively, the worst case for China is that the world polarises into camps, Cold-War style, for 50 years - instead of more-or-less peacefully slipping into his Belt-and-Road vision of China as Top Nation with Xi beaming benignly as every nation hastens to do his bidding, and China resumes its destiny as Centre of the World, and undisputed Greatest Culture On The Planet. 

So: today, I'd say that particular rosy-for-Xi outcome looks rather less likely than it might have done just 12 months ago.  Polarisation it is.  Tough titty, Xi - but you had it coming. 


** I always think of Libya 2011 and the casual overthrow by the western powers of Gaddafi, essentially a Chinese client at that stage 
++ And we know what happened then ...

Saturday 1 August 2020

Weekend: NCO Pilots in the RAF

The other day, somewhat en passant, a BTL comment was made on the surprise expressed by a senior America officer during WW2 that NCOs could be pilots in the RAF.  & I said I would post on the subject.

Well, it's a fact.  Most unusually for western airforces, the RAF - and Commonwealth airforces also - had sergeant-pilots up until the early '50s.   They were always in the minority, right from the start in the RFC in WW1.  However, such was the attrition in that earlier conflict that the initial requirement, of being a jolly good chap, on horseback and with tennis raquet, had to be waived.  (The same was true for Observers: initially the RFC used only expert Artillery spotters, all officers - but that supply-line ran dry quite quickly.  Another subject for a future post ...)  

There were "flying sergeants" in the USAAF into the 1930s, and just a few into the years beyond the war - that US officer wasn't exactly correct that there were no NCO pilots in his own service.  But by WW2 in the USAAF, and later, the USAF, almost all pilots were either commissioned officers or a special grade of warrant officer.  But the RAF sergeant-pilot survived in relatively large numbers, if not in proportion, into WW2 and beyond.

The legend we're invited to accept is that all ranks mucked in together as equals in those Battle-of-Britain Nissen huts.  Certainly, there's a strong strand of informality in the RAF which amazes brown jobs like myself (the Navy will never have anything to do with the RAF, but they'd be pretty shocked, too) - officers and NCOs being on first-name terms.  (I have encountered this right up to 1-star level, and all I can say is:  it's a different culture.  At Sandhurst we were taught: being 'one of the lads' is only a short step away from being 'just one of the lads'.) 

That's the legend.  In practise you can find evidence of things being rather different.  A couple of years ago I ran into an old boy who'd been a Spitfire pilot from around 1942, initially as a sergeant.  Although he was commissioned a couple of years later, and ended the war a Flight Lieutenant, his bitterness at what he considered unfair treatment of the NCO pilots was undiminished by the passage of 75 years.  He cited in detail the case of an officer who'd been awarded a DSO for a daring mission that was no more meritorious than several missions of his own - and he hadn't even been given the DFM ...   

To hear him tell it, although everyone shared the same crew-room before missions, and slap-up tea with extra jam on return, then it was the bus to the Sergeants' Mess, and no fraternising at weekends or off-duty in the pub.  (There's plenty of anecdotal evidence, BTW, that this last bit wasn't universally the case at all.)  Oh, he is a bitter man - even though he did get commissioned.  

Maybe it was just him?  Except ... a short while ago I was assisting with research into the case of an RAF WW2 Typhoon pilot - another sergeant pilot - whose grave, unusually, was at the roadside in a village in northern France, instead of on a CWGC site as would normally be the case.  The story was, he died after being shot down on the outskirts of the village: the mayor pleaded with the Germans for his body (and, interestingly, the propeller, which forms a headstone!) and the Germans agreed.  So there he lies.  

Looking into this most unusual arrangement, I came across a similar case of a Canadian pilot, likewise interred sur seul in France, near to where he fell.  This chap was also an NCO (a Flight Sergeant); and the paperwork showed that he was commissioned posthumously.  Initially I though that maybe his promotion had already been in the works; but it turned out that it was the habit (perhaps as an outright matter of policy, though I never established as much as that) of Commonwealth air forces - Canadian, Australian, NZ - to do this for their fallen NCO pilots.  Not least, their widows got a much better pension.  And in their scheme of things, all NCO pilots got commissioned eventually anyway.

This was a matter of bitter controversy, since the RAF had no such intention - but of course RAF NCOs inevitably knew all about what happened elsewhere.  The RAF's line was: we award commissions, not only for being able to do the job, but for displaying Leadership as well.   Many NCOs, however, were convinced it was a class thing.

So there you have it.  Maybe someone's written a book or a doctoral thesis on all this: but if so, I never found it.  By way of a postscript:  the RAF has for many years now been officer-only as regards pilots (and I'm guessing most other airforces too); and airforce-wise, there's an end to the matter.  However, in the more stiffly formal, but in some ways more meritocratic British Army, 'even' corporals can be helicopter pilots!