Sunday, January 22, 2017

Curse of Cash at World Economic Forum

The World Economic Forum "Future of Finance" session mentioned the "curse of cash."  Panelists discussed draconian negative interest rates and the elimination of large currency bills.  One panelist had this to say:

"One of the wonderful things about financial technology is that it will make everybody have access to financial services and payment systems and credit much more readily than before.  All of that will unfold over the next five and ten years and I think people will be pleased with this.  You won't need to carry a credit card.  You won't need to carry your wallet.  You won't even need to carry your cell phone because everything will probably be through your fingerprint or your eye but we do have greater cyber crime that's likely to occur as well.  A whole variety of things you can invest in now are the things that are going to prevent these cyber crimes.  As you get more financial technology and it becomes a more important part of your life you will find more people trying to get around the system.  I encourage everybody who has some kind of financial tech device to make sure they are protected and make sure they have taken the steps to protect themselves against money being stolen or their identity being stolen.  This is increasingly going to be a big problem in the whole fintech revolution." -- Carlyle Group co-founder David Rubenstein
Which Carlyle Group fintech affiliates are creating the vision Rubenstein painted?  UniRush has the Rushcard and has a stake in several banks, domestic and international.  He said Carlyle and other private equity underwriters (PEU) are investing heavily in fintech.  Trump's Treasury Chief is a former PEU.  In the future I expect Mr. Mnuchin to serve his financial peers vs. the public.

Saturday, January 21, 2017

Family Affair for Davos Future of Finance Session

Two of five panel members pondering the future of finance at the World Economic Forum are related.  Carlyle Group co-founder David Rubenstein is married to Alice Rogoff.  Harvard Economist Kenneth Rogoff is Alice's cousin. What are the odds that 40% of the expert guest would come from the same family?

Friday, January 20, 2017

Thiel Sold Trump & More

Silicon Valley Trump supporter Peter Thiel showed his understanding of what it takes to sell in Davos, Switzerland

Two doors down from the Facebook house, the software giant Palentir has built a party venue with a replica front section of a private jet plonked in the middle of the room.
Thiel backed Palantir protects another annual gathering of global tamperers, The Bilderberg Group.  Palantir is maximally invasive:

Using Palantir technology, the FBI can now instantly compile thorough dossiers on U.S. citizens, tying together surveillance video outside a drugstore with credit-card transactions, cell-phone call records, e-mails, airplane travel records, and Web search information.
How does Palantir protect billionaires in private jets?  Might they be selling populist tracking services.  I can picture the demo:

Video shows Citizen A purchased tar from Home Depot in Lausanne.  They met up with Citizen B who'd bought several dozen goose down pillows and Citizen C who had a gas grill and large pot.  A camera outside the Davos airport showed tar bubbling on the grill and the three populists using a knife to cut a hole in feather pillows.
What lucky Davos attendee got to engage Palantir's private plane counter-populist security features?

Given the fear of an angry populace I'll venture most went to the most severe punishment, the Dynamo feature.

Now that Davos is over Thiel's future includes a possible California Governor run or a Trump appointment as German Ambassador.  The theory is once maximally invasive, always maximally invasive.  We'll see if it holds or requires revision.

Thursday, January 19, 2017

Davos' Lone Trump Man Sells to China Capitalist

Years before President Xi Jinping attended the World Economic Forum Carlyle Group co-founder David Rubenstein lauded China's state sponsored capitalism and opined that only three to four years remained to shift to such a model.

Donald Trump will be sworn in as President of the United States tomorrow.  His lone White House appointee in Davos, Anthony Scaramucci, sold his 45% stake in Skybridge Capital to China's HNA Group Co. and RON Transatlantic EG.  The deal will garner Scaramucci roughly $100 million.

The newly endowed Scaramucci will occupy the Assistant to the President, Director in the Office of Public Liaison position in the Trump White House, which commences in roughly fourteen hours. 

Scaramucci will work with both the US business community and political interests to further the goals of the Trump administration. 
It's more like the office of PEU liaison.  Seeking Alpha noted Trump's propensity to appoint and rely on the advice of private equity underwriters (PEU).  The greed and leverage boys have a direct connection to the White House, which has the PEU lobby encouraged.  

Dream for All Now Dream for One

The annual billionaire gathering of global elites in Davos, Switzerland has a dream.  Large swaths of people expressly rejected the World Economic Forum vision where machines replace people in the workplace, billionaires do deals in $100,000 a day suites, debt is maximized to optimize capital and cash is recalled in favor of electronic transactions, justified by "the poor will like it."

Consider a different dream nearly six decades old: 

"I look forward confidently to the day when all who work for a living will be one with no thought to their separateness as Negroes, Jews, Italians or any other distinctions. This will be the day when we bring into full realization the American dream—a dream yet unfulfilled. A dream of equality of opportunity, of privilege and property widely distributed; a dream of a land where men will not take necessities from the many to give luxuries to the few; a dream of a land where men will not argue that the color of a man's skin determines the content of his character; a dream of a nation where all our gifts and resources are held not for ourselves alone, but as instruments of service for the rest of humanity; the dream of a country where every man will respect the dignity and worth of the human personality. That is the dream..."  Martin Luther King 1961
Eight men control half the world's financial assets.  Add the cumulative billions of others in Davos and the percentage soars to what?  Sixty percent, seventy five percent?

Many voters in the U.S. and Britain reacted to the raw deal they've had in the workplace for decades as executives enriched themselves massively while acting on their belief that workers are dispensable and easily replaced/interchanged.  This dehumanization made it easier to cut benefits and scrimp on pay, mostly to ensure executive incentive compensation was maximized.

Voters reacted to the insider class which traverses between government, corporations and think tanks.  The public glimpsed their boldness and greed in the pursuit of power via John Podesta's e-mails.  Rest assured both the Red and Blue political parties aggressively play this insider game, where the main measure is who wins the election and can steer the federal might and budget toward their sponsors for the next four years.

In the early 1960's Reverend Martin Luther King spoke about injustice, moral, psychological and economic. 2017 has the injustice of criminal Wall Street that serially buys its way out of fraud and market rigging investigations.  The psychology of Davos is "lived excess" by the very insider class that benefited so disproportionately the last few decades.  Fittingly, this week consummate insider Larry Summers pontificated on the plight of the middle class, decimated by corporate flippers.  Long ago Larry promised not to bite the hand that feeds him, no matter how greedy or malevolent.  He's stuck to his word and the rewards have been great.

Contrast Larry's dream of acceptance by the greed and power boys with that of Martin Luther King.  One dreams for all, while the other dreams for one (their self).

Sunday, January 15, 2017

Private Equity Targets Korea

Private equity underwriters (PEU) have Korea in their sights for expansion.

Korean firms that hold a competitive edge against their peers and capability to generate ample cash from running their business are attracting global PEUs. In addition, the weakening Korean won against the U.S. dollar that lowers the prices of company stakes in dollar term is expected to further encourage global PEUs to seek investment targets in Korea.
Ample cash is needed to cover deal fees, rising interest expenses, annual management fees and assure debtholders who may fund the next massive PEU dividend.

What happens when private equity becomes ubiquitous in Korea?  How stagnant will wages have become?  How much will their middle class have shrunk?    

Saturday, January 14, 2017

CGI Closing as Clinton Brand Tarnished

Global tamperers will have one less gathering in 2017.  The Clinton Global Initiative is closing shop.  It had been one of the must attends for the greed and power class.

"Always do your best to do the research and find people that are consistently going to Milken-level type conferences -- CGI, Davos. Anyone who knows those really big brands that cost over $10,000 to [attend] -- they know what they’re talking about.
Twenty two CGI employees will be laid off come April 15th, America's traditional tax day.  The Davos confab will have something else to talk about during this week's World Economic Forum gathering.