Tuesday, November 11, 2008

The Clearest Description of the Financial Crisis

I found this to be the best description of our current financial situation and how we got here for tech geeks like me who understand a lot about computer software and hardware but not much about economics. The lingo is down-to-earth enough for a layman to understand and they provide great examples that many people will be able to relate to.

My summary goes something like this:
  • Consumers borrowed money to finance their homes or took out second mortgages to fund other purchases (sub-prime loans)
  • Investors placed bets on whether or not those consumers would default on their loans (Credit Default Swaps)
  • They paid for those bets using borrowed money (leverage)
  • Bets that were placed when the odds were better grew in value as the odds worsened and it became more likely to pay out
  • The investors who originally placed those bets then sold them to others hoping to benefit from a more certain pay out
  • All of this happened in a dark alley of private, unregulated transactions
  • Now, no one knows what those bets are worth and who is holding them
  • So no one is willing to lend to anyone else
What's really frightening is that investors place bets like this not only on home loans but on all kinds of loans: even on government bonds. I heard that some were even betting that certain European nations would default on the debt that they took on to bail out their economies! Wow!

Listen to the full show: Another Frightening Show About The Economy.
This American Life
Chicago Public Radio

Monday, August 18, 2008

Emotional Mismanagement

If there's one thing that doesn't get enough blame for undermining productivity, creativity, and the smooth functioning of business, it's the mismanagement of emotion in the workplace.
-- Jack and Suzy Welch
See the full article in Businessweek, 17 July 2008

Saturday, July 19, 2008

The Data Warehouse Revised

Column-oriented databases and appliances are ushering in a new era, yielding significant price and performance wins over conventional database technologies. See the following article in the May 24, 2008 edition of Information Week:

Reinvent The Data Warehouse With Column-Store Databases And Appliances

Saturday, July 12, 2008

Friday, July 11, 2008

Quality = Customer Focus = Revenue

Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for.
-- Peter Drucker

Thursday, July 10, 2008

Full speed

It's better to make a mistake with the full force of your being than to carefully avoid mistakes with a trembling spirit.
Way of the Peaceful Warrior
Dan Millman

Wednesday, July 09, 2008

Moderation... the devil's own brew!

Moderation? It's mediocrity, fear, and confusion in disguise. It's the devil's reasonable deception. It's the wobbling compromise that makes no one happy. Moderation is for the bland, the apologetic, for the fence sitters of the world affraid to take a stand. It's for those affraid to laugh or cry, for those affraid to live or die. Moderation... is lukewarm tea, the devil's own brew!
Way of the Peaceful Warrior
Dan Millman

Monday, July 07, 2008

Crimeware Pays

The going rate for access to a good World of Warcraft avatar is $10 or more on Internet black markets... You can buy a [real person's] stolen identity for anywhere from $1 - $2.
IEEE Spectrum, July 2008
By Mark Anderson

Sunday, July 06, 2008


We especially need imagination in science. It is not all mathematics, nor all logic, but it is somewhat beauty and poetry.
-- Maria Montessori