Monday, November 23, 2009

"The next five years will witness an unprecedented level of M&A"

That's the conclusion reached by Montgomery and Company. Just what we need. MORE consolidation and SKEW of resources into the hands of the few. Perfect. In summary:
Montgomery & Co. review and outlook of venture-backed companies and the M&A markets:
1) There were over 7,000 private and independent venture‐backed companies at the end of 2008. There are 800 independent companies with venture investment dating 10 years or more. This level would double within 18 months unless M&A accelerates.
2) We expect pressure on venture firms to achieve realizations combined with consolidation of the growth sectors to drive M&A activity to 50% above historic levels by 2011.
3) We expect an increase in M&A as strategics accelerate their acquisition activity.
4) We project the median consideration for M&A to recover, but remain below recent levels
5) The total consideration of venture‐backed M&A will reach $60 billion per annum by 2013.
6) “IPO ready” companies have been delayed by the economic downturn, but we expect a recovery in the IPO market—which will also boost M&A activity.
7) Investment returns for venture investors will remain largely driven by M&A exits.


The Return of M&A: An Outlook For The Venture Industry -

Saturday, October 31, 2009

Productivity Dividends Permanently Denied

Don't like it? Move! That's the legacy of your 19th century industrial era capitalism. The U.S. is not and has not been the Supreme Society for some time now. Today, the Emperor is finally realizing that he's wearing no clothes.

Take vacation time as just one example of resolutely denial-bound and unevolved U.S. culture; and remember, if you get sick, be sure to enjoy your vacation, puking your guts out, because that sick time is taken out of your paid time off (PTO), too. We don't even call it "vacation" any more because you're not entitled to any, whatsoever.

Productivity Dividends: DENIED.

If you're in the bottom 90% ... and, um, 90% of us ARE, we are to be grateful for our ever dwindling little pot of PTO. Vacation? Don't make me laugh. You want to become like those LAZY FRENCH people, I suppose. Yep, they look pretty LAZY to me.

For centuries we've been taught in Economics 101 that technology improves efficiencies which yield ever increasing productivity and productivity dividends. Labor saving after labor saving devices and methods have accrued for hundreds of years, yet, there is no saving of labor's fate. Ever.

We're not talking about people getting something for nothing, for heaven knows the permanent heirs of the American aristocracy will have none of that, we're talking about the people who created the dividends, sharing proportionately in the dividends.

No labor saving productivity dividend is ever declared and distributed to shareholders: you and me. Such dividends are only ever hoarded and squandered by the top 5%, 2%, 1%. The smaller the percentage, the more pathological the hoarding. It is, ipso facto, clinically pathological, even functionally sociopathic when one measures the dire fate of so many as the direct consequence of the behavior of so few. A sociopath is a person, a psychopathic personality, whose behavior is antisocial and who lacks a sense of moral responsibility or social conscience.

This will sound all too familiar to today's prevalent American 19th Century Industrial Capitalist Culture, which obliviously shrugs and says, "so?"

Sociopathological cultures kill through the Invisible Hand of a twisted and brutal wage slave tyrant. Today the brutality is reaching all new extremes, but because it is the Invisible Hand of the almighty market at work, there is no one to blame when high school children in Palo Alto are killing themselves in packs, jumping in front of trains, as the pressures of conformity to this pathological culture of hoarding and false scarcity mount to all time highs. What more evidence do you need, America?

You are literally killing your best and brightest youth. They know that they can't exist in such a soulless society. So they choose their only out. If they could move, they probably would; but their tragically heartbroken parents have become analogies for you, America. You probably truly do love your children. You probably have done your best. However, the Entire Environment in which you've been operating is Terminally Toxic.

If the entire culture is not changed, nothing you do or could have done, will ever save yourselves or your children. I share the devastation of your loss.

For those not so compassionate, no, the infinite iPods and PSP's were not enough to "satisfy the little spoiled brats" if that's the unconscionably cruel path of reasoning you'd like to take in response to this terrible situation; and I know you are out there, I've heard your conversations. You are poor and disenfranchised and bitter; told you are in the "middle class" even as you are numbered among the bottom 80% of Americans who scramble and claw to share just 8% of the economic pie in this country.

Yet, those children are human beings, random victims of the fate of their births just, as are you. No one deserve such a fate. So while I identify with the bitterness of the bottom 80%, I do not condone twisted and cruel interpretations of such unthinkable human tragedy.

There is, however, an abiding and ascendant message in the growing numbers of these situations: if we don't find a path to sustainable postscarcity, all the manufactured crap in the world will never save us. All of the hoarded and accrued wealth will never save us.
We are literally crushing ourselves and our children under the weight of our own avaricious abundance.
With nothing but the most crushing pain for those families in my own heart of hearts, I must honor the sanctity of those magnificent lives by stating that:
Those trains are the very embodiment of the culture that created them, a nineteenth century culture that we continue to cling to with all the fervent faith of the most sincere Stockholm Syndrome devotee.

SOURCE: MarketWatch.

Perhaps this is just one empirical consequence of your pathological inbred hoarding of your mythological Productivity Dividend, America. Yet, when canonical publications like MarketWatch write that "Vacation-day allotment varies widely by country" and that "some workers enjoy eight weeks off per year; U.S. near bottom of list" the message in the title tag text is:

"Want more time off? Move ..."

That derisive, arrogant, corrosive credo is a hallmark of a McCarthy era religious fervor that still has it's grimy, oil-and-blood stained hands firmly on the levers of U.S. domestic policy and corporate culture. Those same hands are presently strangling the last gasps of life out of health care reform while whispering silently, the last words you'll ever hear:

"If you don't like it, move."

This is "MARE-ick-uh" mister, we don't compare notes with other nations that might have one hundred times the broadband at one tenth the price; we don't compare notes with other cultures that have found sustainable work-life balances; we don't compare notes with NOBODY.

Don't like it? Move!

And that's precisely what America's best and brightest have been doing and continue to do.

Thursday, October 29, 2009

How to Properly Manage Material Abundance: TEAR IT DOWN

Hilarious! This morning on CNBC Rick Santelli issued another famous parenthetical recommendation to restore the economy:
TEAR DOWN ALL UNOCCUPIED HOUSES so we can create jobs by building them all over again.
Wow, really?

I should really be a bigger fan of Mr. Santelli's because he continues to provide some of the most clear and compelling analogies that illustrate the sheer absurdity of the Job Trance gripping America. A Job Trance crippling progress, even as we hobble and wobble in our current self-inflicted state of socioeconomic anomie, the 100% accurately forecasted result of 19th century industrial era capitalism's centuries of success.

Such absurd suggestions to TEAR IT ALL DOWN should actually encourage us, for they provide additional empirical glimpses of a tragically misguided consensus reality crumbling before our very eyes. Crumbling, finally, despite the decades of institutional denial that refused to acknowledge the obvious manifestations of an emerging postscarcity society. Crumbling, despite the academic procrastination in noodling our way through sustainable new ways to circulate resources in a manner that continues to foster breakthrough innovation and sustainable technological progress.

The parenthetical Santelli Solution is to smash it all down so we can build it back up again. Wow. Really? Last I checked, most healthy children outgrew that stage of build it, smash it, build it, smash it, self-discovery and development by about age ten or twelve at the very latest. Grown ups realize that once you have built an asset, you employ and maintain that asset in a manner that maximizes its useful life.

As a society, if you've created so much abundance and surplus that all your old assumptions are proven wrong, the solution is not to DESTROY YOUR ENTIRE LIFE in order to prove you can build the same suboptimal life from scratch, all over again. Maybe that makes sense in some bizarre Any Rand fantasy where the hero architect turns noble ditch digger, but it's just plain ridiculous in the real world. Even the bible counsels that there is no nobility in a dog that repeatedly returns to it's own vomit.

As written here time and again, the problem is not that capitalism is evil or wrong or failed (in material terms). Rather, it's a victim of it's own one-trick pony variety of success and hobbled by genetic defects that include severely crash-prone short-sightedness and manufacturing myopia. It only knows it's own perspective. It only sees it's way to the next bend in the road. It's great at transporting societies from Point A to Point B -- agrarian to industrial -- with incomparable speed and efficiency; yet, then it stands utterly stunned and dumbfounded, paralyzed by the discovery of a Point C, beyond. "Now what?" panics capitalism. "Quick, back to Point A so we can show how awesome we are at getting to Point B!"

A to B, A to B, A to B. Boom, bust; Boom, Bust; boom, BUST. That's the best we can do with our best and brightest minds? Really? I don't buy it.

I don't buy it because I can't imagine a more pessimistic view of the world or of humanity, than one that believes that build it, smash it, build it, smash it, build it, smash it permanently manufactured scarcity industrial era capitalism is the permanent state for an ever accelerating technoprogressive society.

Wednesday, October 21, 2009

Meet your Closet Communist Central Planning Controllers?

Has the U.S. actually been a Closet Communist economy, all this time? Would implementation of Free Market Socialism actually be a conservative movement? Goldman Sachs PR effort begins:

"The danger is that it comes off like propaganda." -- Fierce Finance

Trust us, we've been centrally controlling things for decades. We decide the winners and losers. We Win. You Lose. We do this For Your Own Good, to make sure you have just enough gadgets to keep you sedated and just enough cash to keep you one month from homelessness. Slavery built American and wage slavery grows America. If it ain't broke, don't fix it.

Here's the full story from Fortune where, "Facing jeers over outlandish pay, the CEO of Goldman Sachs stresses the social goods of his firm's business."


My only question is, what do you call the third tranche on the second derivative of irony?

Monday, October 19, 2009

How Wall Street Makes Billions Kiting YOUR Cash

Philip Greenspun's Weblog:
So the money is just being shuffled from one Federal bank account to another, with each Wall Street bank skimming off $1 billion per month for itself? “Pretty much.”
It's OUR cash. YOUR cash. We own the treasury and WE print the paper. This is no different than if I loaned you 20 bucks for lunch and when we get back to the office you said, "Now just give me another $0.60 and I'll give you your $20 back." Do the same thing with a billion and you pocket $30,000,000.00 for nothing more than taking my own money from my left hand and passing it back to the right.

Complete System #FAIL.

Monday, September 21, 2009

When One Plus One is Less than One

When One Plus One is Less than One, the fundamental postulates and theorems, the relationships that define the entire game, have long since changed in ways that might seem almost completely unbelievable, at first glance. However, when closer inspection, cross examination, and methodical testing each confirm the new relationships, then entirely new methods of operation must immediately begin to take shape as we work together to define a New Normal. We could call this willingness and ability to assess and integrate new information Adaptive Resilience.

So with thanks to @johnrobb by way of @changeist via @urbanverse, 2 minutes and 35 seconds for your consideration:


Or download .SWF if JING playback gives you a hard time.

Elizabeth Warren, "With two people in the workforce, [today's families] actually have fewer dollars left over than their one income parents had a generation ago, to cover EVERYTHING. So what we have today is, TWO PEOPLE working full time, flat out, hard bore and they actually have less money to spend than one person working full time, just one generation ago.

Harry Kreisler, "And the older system, had a built in backup, this system does not because both are already working. This is a very VULNERABLE family that we have today because of an uncertain job market, healthcare, [unexpected or catastrophic] illness, and so on."

Remember the context here, friends. This is from MAY 2007! Long before the MULTIPLE MELTDOWNS of 2008. So families were already on the precipice of existence ALREADY ... *LONG BEFORE* THIS CRISIS STARTED.

Just to clarify, however, let's further remind ourselves that every Econ 101 student knows to ask the fundamental question of economics, "Compared to what?" So, we ask dear reader, what do you suppose is the state of the American family TODAY, as compared to MAY 2007? Better? Worse? The same? We all know the unequivocal answer to that question, and that answer is VASTLY WORSE.

But vastly worse COMPARED TO WHAT? American families are vastly worse compared to Teetering on the Very Precipice of Existence in the years just prior to the meltdowns. That can't possibly be a sustainable situation.

By all means, I encourage you to keep digging for yourself by viewing the full May 2007 Interview with Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

25.8 Million Americans OUT OF WORK and Growing: Some Simple Math

Planet Money writes "The ranks of the unemployed now include 14.9 million people in the U.S., up by 466,000 since last month." But that's not all, "The broadest measure of unemployment -- U6, which includes discouraged workers and those working part-time because all they can get -- hit 16.8 percent. That's up from 16.3 percent in July."

NPR News adds, "Unemployment Hits 26-Year High Of 9.7 Percent - The number of weekly hours worked remained at 33.1, above the low of 33 reached in June. Economists think companies will add more hours for current workers before hiring new ones."

This ain't ending any time soon, friends, if ever. So, why do we stay so fixated on what worked in 1850, when we are here on the cusp of 2050? It's really not that far away, boys and girls; think how recent 1970 was, from today's perspective. That's how close 2050 is, in the other direction.

Let's try some simple math: if 9.7% average unemployment means 14.9 million Americans on or approaching skid row, then the actual 16.8% total unemployment means at least 25.8 million Americans -- human beings like you and me -- out of work, right now.

Of course, we all know that these figures are based upon reports filed by people who are still sufficiently connected to the bureaucracy to even bother filling out the forms; so those who have dropped entirely off the grid are still not accounted for. Let's be super conservative and call that 10% of the 25.8M total.

That brings our number of Americans out of work to 28.4 million. For the sake of thinking just slightly ahead, if we call 20% a more forward-leaning estimate, that puts the total over 30 million. Even if that's a tiny bit high for today, it won't be very long until that number is indeed reached, right? If not during this particular roller coaster cycle, the next one or the one after that, because these numbers do nothing but grow, over time. That's not a direct indictment, because ironically, it's mostly because of how EFFICIENT we've become!

More on that efficiency later.

For the moment, just imagine 30 million Americans Out of Work and told that their only options are to find More Pretend Work or live on the streets. This, while empty housing and commercial space inventories are approaching all time highs. Oh, and housing starts are ticking up so we're building even more Empty Houses and more Empty Offices.

But they'll stay empty, unless you go back to playing YouTube videos in a cubicle instead of doing it right where you are, where you can keep an eye on your kids, help them learn, be involved in your community, and continue your own program of lifelong learning that could very well lead to the next breakthrough innovation -- even small but economically meaningful ones -- because you were finally afforded the 20% time REQUIRED for new solutions to come to fruition.

Yet, here we are, closing in on U6 Total Unemployment of 20%, where suddenly 30% doesn't seem that far out of reach.

Aren't those 30 million American lives enough already, or do we really have to wait for 30%? Do we have to wait until ONE THIRD OF AMERICA is ON THE STREET before we simply call it what it is -- The Ultimate Achievement of Industrial Capitalism: Structual Unemployment -- and move on to the inevitable Basic Income solution? Do we really need to keep stalling?

Why keep kicking the proverbial Good Samaritan while he's down with the same vapid sentiment of kicking the can down the road? We all know that, "yeah, some time in the future" things will be as we describe them; so why not just go ahead and start fixing things now? Do we really need to keep up the same dysfunctional cycle of perpetuating crises before implementing positive adaptations that we all know are inevitable, anyway?

As a nation, as a global village, we can break this cycle of systemic self-loathing procrastination, if we simply choose to do so in large enough numbers. All of "the economic rules" that govern our expectations and interactions are implemented fictions: we made them up, and we can change them to better suit our desired outcomes for a world of sustainable abundance and peace.

I believe that it is no overstatement to suggest that, by the standards of 1776 existence, we are indeed very close to a place where we can confidently declare Mission Accomplished in terms of providing unconditional material sufficiency for everyone. Even if we are not "quite" there, the goal is sufficiently within reach to begin adapting our institutions to that inevitability, today. By what possible logically consistent rationale would we continue to so demure?




Learn more about agalamics.

Sunday, August 30, 2009

Read this Book:: Capital as Power: A Study of Order and Creorder - autoethnography

Read this Book:: Capital as Power: A Study of Order and Creorder - autoethnography: "Jonathan Nitzan and Shimshon Bichler are a tremendous influence on my approach to politics, economics, and culture. Check the Capital as Power table of contents, buy it, or read the first chapter (download at bnarchives.net)."

SOURCE: The #CuratedWeb of the cognizer occasionally known as @fidler (link pending DNS propagation).