×

Announcing: Slashdot Deals - Explore geek apps, games, gadgets and more. (what is this?)

Thank you!

We are sorry to see you leave - Beta is different and we value the time you took to try it out. Before you decide to go, please take a look at some value-adds for Beta and learn more about it. Thank you for reading Slashdot, and for making the site better!

Comments

top

Valve's Economist Yanis Varoufakis Appointed Greece's Finance Minister

alexander_686 Re: This doesn't sound... sound (321 comments)

You are half right but that is not the plan.

The game plan for the Greexit would be to convert everything, both assets and liabilities, into Drachma. Euro bonds issued by the Greek government are controlled by Greek law. Or any debt issued under Greek law. There will be some messy cases.

As you say, after a Greek exit from the Euro their currency would be worthless which is kind of the point. They get to pay their debts with worthless currency. The local currency becomes worthless making their exports (such as tourism in a oddly back end way) more competitive.

And yes, they would lose the benefits of being part of the EU. Personally I think the long hard road of austerity is the better choice but I do acknowledge that there is a second road out there.

The last time Greek flirted with an exit everybody who could kept their money out of Greece. I heard about some interesting cash sweep transactions to minimize any money that had to stay overnight in Greece. i.e. keeping money in safer German banks, figuring out on a daily bases what was being paid to and from local suppliers, and then moving only just that amount of money over.

yesterday
top

Valve's Economist Yanis Varoufakis Appointed Greece's Finance Minister

alexander_686 Re: This doesn't sound... sound (321 comments)

The people aren't willing to sacrifice to pay back the debt.

What if the question was not about "wanting to pay back their debt" but about their ability to pay back their debt. IIRC their debt stands at 170% of GDP plus they are paying 10% on their bonds. IIRC, Germany actually has a slight negative interest rate. We can debate how bad things have to be before they can't pay back their debt. However if they are not there they are getting pretty close.

If Greece were a person or a company they would file bankruptcy. Assets would be sold, reforms would be made, and liabilities would be cut. Life goes on.

Should countries borrow more than they can afford? No. Should bankers lend to countries that can't back. There is enough blame to be spread around to both parties and so both parties should suffer. Expect that Greece can't declare bankruptcy so they have back themselves into a corner.

2 days ago
top

Valve's Economist Yanis Varoufakis Appointed Greece's Finance Minister

alexander_686 Re: This doesn't sound... sound (321 comments)

That consideration is a factor, but governments tend to be long lasting entities, so they could certainly eventually pay off the debt, if they shrunk or even deferred payments for awhile. Something is usually better than nothing for a vendor, as long as the cost of administering the debt is less than what they bring in.

I think you missed my point here.
        Greece could default, and replace the old bonds with new bonds at 80% of par. I lose 20% of my value.
        Greece could cut the interest payments from 10% to 5%. I lose 20% of my value.
        Greece could push out the repayment schedule from 10 years to 15. I lose 20% of my value.

Any way I cut it, I as an investor lose 20%. Psychologically it may be less damaging to my repayment is pushed back by 10 years but the immediate economic damage is the same.

So why is shrinking better than deferment? I think that there are differences but I would like to hear your viewpoint.

Unfortunately, financial solvency doesn't provide for retirement for people directly, although for any realistic social insurance program, you need to have long term financial stability and capacity. That means that even though austerity may actually work, there is clearly not the will to see it through.

We might have the same opinion here, but I will point out that any unfunded pension is a liability. What moral argument can you make that private pension plans that invested in Geek bonds should take a hit while the public plans don't? And I think you can make that argument – but it does make the point that public pensions need to be in the mix of future obligations that need to be cut.

It may be a good idea for Greece to default and deal with it, but that will end their ability to get anything like good loans in the near future. And I don't think the extra money from no longer paying on the debt will fix the quality of life problems that the people in Greece have right now.

I will slightly disagree with you here. I personally think Greece's big problems are structural. Too much bureaucracy, inefficient collecting of taxes, etc. Reforming these items would not cost the government anything, but there would be a painful period of adjustment for the common man. However, the end result would be a stronger, more efficient, rational economy.

However, I would tend to agree with you that a clean bankruptcy is better than a messy partial default. Expect that there is no real mechanism to Greece to default. If I understand correctly, it would be easier for Greece to exit the EU, convert to the Drachma, and devalue the currency.

2 days ago
top

Valve's Economist Yanis Varoufakis Appointed Greece's Finance Minister

alexander_686 Re: This doesn't sound... sound (321 comments)

I have a question for you – what do you see as the difference between extending payments and defaulting / writing down on the debt?

IIRC, the last round of "extending payments" effectively reduced the net present value of the debt by 20%. At a certain point, the difference between restructuring and defaulting comes down to semantics.

2 days ago
top

Proposed Space Telescope Uses Huge Opaque Disk To Surpass Hubble

alexander_686 Re:keeping station behind it? (124 comments)

I too would like to know how to do this.

I can think of a couple of ways that this could be done but none seems practical.

Have both on the same orbital track, but then you are always pointing sideways.
You could tether the two objects together, but I think that there have been issues with all of the experiments so far.
A long time ago I read a theoretical paper that one could achieve a "geostationary orbit" with an active solar sail, but it has never been tried.

2 days ago
top

Google Thinks the Insurance Industry May Be Ripe For Disruption

alexander_686 Re:Both of you are off the mark (238 comments)

You can read the above threat for the ongoing argument between myself and others.

In short, by value or by risk weighted value, most life insurance products are annuities. a.k.a. private pensions. These pay cash for as long as you live. If life expectancy were to increase, the amount of cash needed would increase. This would tap the reserves of the insurance company.

On the flip side, increasing life expectancy would help the insurance companies with term or whole life insurance – the type of insurance that pays out when you die.

Which takes us to risk, because the risk of people dyeing too soon and dying too late is not the same. What is the chance that a large number of people will all of sudden die 5 years early? Maybe people in their 70s will take up smoking and skydiving. What is the chance of people dying 5 years longer? Maybe some medical breakthrough? Most of the surprises have been in people living longer, not shorter lives.

about a week ago
top

Google Thinks the Insurance Industry May Be Ripe For Disruption

alexander_686 Re:Both of you are off the mark (238 comments)

For term life you absolutely care about the financial stability of the company. Term life isn't "short-term" like 6 months, it's "short term" like 10-20 years. Property insurance is typically a 1 year term and the difference between a company that looks like it will be able to pay it's bills for 1 year versus one that can pay for the next 20 is huge. Just ask pets.com.

As you point you, who know what the future will bring? Volatility is an insurance company's enemy. Take a look at the volatility of the actuary tables over the past 20 years for middle aged adults. And we see almost no change. But we also need to protect the premiums for the market risk of Pet.com from blowing up. However, rates are calculated using 20 year government bonds with no inflation protection, so low risk there. Capital requirements tend to be low because of the low risk. So yes, 10 to 20 years in short term in insurance lingo for such a dull boring product. Well, maybe medium term.

Your understanding of whole life is totally incorrect. Whole life is a life insurance policy that does not terminate after a set number of years; rather, as long as you can cover the cost of premiums, it continues to be in force. An annuity is an entirely different product (although it can also be sold by insurance companies).

Technically you are correct, but I alluded to that. Ask people on what they have got and most will answer whole life. Peak underneath the hood and 9 times out of the 10 you will see that the majority of the payments going towards an annuity.

As for dying in year 29 of the 30 year term policy, he is referring to the fact that since you are still in the term, you should get the death benefit (whether you paid as a single premium or annual premiums is not so important). The problem is if the company goes bankrupt in year, say, 24, then you don't get a death benefit. True, you aren't on the hook for premiums after the company goes belly up, but if you get 30 year term insurance as a healthy 35 year old, then the company goes bankrupt after 24 years (when you are 59), you are in big trouble. You were paying relatively cheap premiums that took into account that you have been paying since you were 35, but now you have to go find another company and get a new policy, now as a 59 year old. And if you have developed health issues since then it's even worse.

Technically you are correct here but reality is different. Rates are calculated using actuarial tables and long dated government bonds – both are low risk. State regulators require reserves and segregated risks. I can't think of the last time an insurance company got into trouble for writing term or whole life insurance. When AIG blew up it did not affect their whole life policy holders because of the safe guards in effect. Once again, a low risk, low capital line of bossiness.

Now, take a look at the average life insurance company. For "Life" products, annuities and the like dominate the balance sheet. Often by a factor of 10. While I can't think of an insurance company that has gotten into trouble over their term or whole life, there have been many companies that have had issues with their annuities and long term care. Actuarial tables have not moved much for middle age individuals – not many die. Figuring out when old people is harder and most of the risk here is that people will live longer, not shorter. This helps the whole life side but that tends to be the smaller side.

about a week ago
top

Google Thinks the Insurance Industry May Be Ripe For Disruption

alexander_686 Re:Both of you are off the mark (238 comments)

Life insurance can be broken down into 2 major types.

The first is "Term Life". You agree for a term of X years – let us say 10. You pay a premium. In return, if you die, your heirs get a big payout. This is what you are talking about, and you are ½ right. In this case the insurance company wants you to live a longer life. However, it operates more like property insurance because it is short term so the need for financial stability is less.

The second class is immediate annuities, which most people know as whole life. Immediate annuities provide a cash stream for as long as you live so you can think of it as a private social security plan. You are right that these plans share the same risk characteristics as long term care. However, the annuities business is about 100x as large as the long term care bossiness. If you need payments for 30 years then financial stability is more important.

Now, I am rereading the OP and the need for 30 years of "term" insurance and dying in year 29 and I am getting a little confused. It sounds like he is referring to a 30 year term insurance policy with a single premium but those are very rare in America. That would straddle the line. But I would guess that he is confused on how term insurance with a cash balance works – which is an arcane subject so I will let that slide.

about a week ago
top

Google Thinks the Insurance Industry May Be Ripe For Disruption

alexander_686 Both of you are off the mark (238 comments)

I will point out that there is a huge difference between life and property insurance. Both are highly regulated.

Property insurance, which includes auto insurance, is about short term risks. They buy reinsurance to protect them against big, one off extraordinary risks. Earthquakes, hurricanes, etc. If they muck up on ordinary risks, such as basic underwriting, they can still go bankrupt and leave you one the hook.

Life insurance is a whole different ball of wax. Their biggest risk is superannuation risk – people living longer than expected. There are a few reinsurance schemas which have just been launched but they are untested. Very much the expectation. Here you do want financial stability.

about a week ago
top

Star Trek Continues Kickstarter 2.0

alexander_686 Re:No!!! (108 comments)

Expect they can't sell them. As long as they give them away for free as fan based art, Paramount will tolerate the infringement. Start charging, probably not.

about two weeks ago
top

Bitcoin Volatility Puts Miners Under Pressure

alexander_686 Re:Bitcoin (290 comments)

I would argue that you can't separate the two points. But this may be splitting hairs too finely. I have found many backers of BitCoin want to insist that there is such a thing as inherent value and that all we need is a better system.

"Money" is on my booklist but I not gotten around to it yet. I would counter with "Lords of Finance" by Liaquat Ahamed. It covers the interwar period in Europe and the issues that Central Bankers had because they lacked money because America had sucked all of the gold out of Europe during WWI. I found the tale sobering. Money may not have any inherent value but it is still an important thing to get right.

Or maybe "A Monetary History of the United States, 1867-1960" by Milton Friedman, but that thing can be used as a door stop.

about two weeks ago
top

Bitcoin Volatility Puts Miners Under Pressure

alexander_686 Re:Bitcoin (290 comments)

For the record, I don't think it's possible to create a medium of exchange that can't be speculated in. That would require worldwide agreement of every person living and every person yet to be born.

I would disagree, but I think we are on the same page.

A "medium of exchange" is a here and now thing, swapping A for B. I don't need a agreement with some born future person because the transaction is occurring now. These types of transactions can be bullet proof.

My point is that money is and medium of exchange is not money. Money is a medium of exchange AND a store of value. This introduces a time dimension and future values. The reason why money has volatility - and thus can be speculated in - is because it is an imperfect store of value. And in fact, there can be no perfect store of value. Now we need agreements with unborn children. Plus agreements on technology, input costs (no peak oil here), and unforeseen events (e.g. crop failures).

But I do think we are on the same page.

about two weeks ago
top

Bitcoin Volatility Puts Miners Under Pressure

alexander_686 Re:Bitcoin (290 comments)

No, it is very possible to make to make a medium of exchange so it can't be speculated in. Almost trivial.

The issue is that for something to be money it must be a medium of exchange, a store of value, and a unit of account. It is the store of value that is tricky. Nothing can be a full proof store of value since value is sitting on the shifting sands of time. Value can never be locked in. What may be plentiful and cheap today may be scarce and dear tomorrow. Taste and wants change. Technology and productivity changes relationships. Wars destroy things of value. This is hard to do.

about two weeks ago
top

Cryptocurrency Based Basic Income Program Started In Finland

alexander_686 Re:It's a con... (109 comments)

I am not sure what you mean by "value ", but I am going to make 3 points.

First, does money have value at all? The minority view is the "Metallist" (a.k.a. hard money or gold bugs), which believes that money has (or should) inherent value. The majority view is "Chartalists", which view money as a type of credit – chits to be used for trading and have no value in itself. But this point might be more philosophical than what you meant.
Secondly, there is inflation / (deflation), which is what you are thinking about. That is based on the change for the demand in money divided by the change in supply of money. So you can pump new cash into the system, but as long as the demand for money increases you won't see any change in value. Demand for cash is closely tied to the economy. As productivity grows the economy grows. As the economy grows, demand grows.

Third, there is a subtle but important difference between currency and money. There is about 2 to 3 trillion in United State in "M1" currency. The Federal Reserve has a strong influence over this. But remember, anything that looks and acts like money is money. So the money in your checking account technically isn't currency but it does act like money. So the USD money supply is closer to 12 trillion. I point this out for 2 reasons. First, adding 10m to the money supply via cryptocurrencies does nothing – it is a rounding error. Second, cryptocurrencies are not being treated as real money. You can't readily make deposits at a bank with them, borrow them, sign long term contracts with them, etc. Until that happens cryptocurrencies will remain a curiosity and have little impact on the real economy.

about three weeks ago
top

SpaceX Rocket Launch Succeeds, But Landing Test Doesn't

alexander_686 Re:A bit off topic (213 comments)

Maybe. While your points are valid, I would be careful about using the Space Shuttle as a key exhibit because it was the result of a stupid compromise.

The Space Shuttle was designed to land at the Vandenberg Air Force Base, which is much further north than Kennedy. In order to reach that far north the Space Shuttle needed a delta wing and had to come in screaming fast. The civilians at NASA would have preferred a straight wing. While it could not have reach Vandenberg, it was lighter and landing the thing would have been easier since it would have been at lower speeds.

I personally think this one of those stupid compromise decisions that morphed the Space Shuttle from a cheap reliable pickup truck into one of the most complex and expensive machines to run and set back our space program by 20 years.

about three weeks ago
top

SpaceX Rocket Launch Succeeds, But Landing Test Doesn't

alexander_686 A bit off topic (213 comments)

I have a semi-related questions – why not add wings and land the first stage like a airplane or done?

Is the extra weight for the fuel needed to land the first stage really that much less than the extra weight for wings? Even if the wings weighted more, I would think that the simpler design would win over. Of course, I am assuming that balancing a multi-ton pencil on a pillar of flame is hard.

about three weeks ago
top

AMD, Nvidia Reportedly Tripped Up On Process Shrinks

alexander_686 Re:I got an idea (230 comments)

Sculley said it was his mistake - which is not saying that Amelio didn't say it as well. Here is the old Slashdot link.

http://apple.slashdot.org/stor...

about three weeks ago
top

AMD, Nvidia Reportedly Tripped Up On Process Shrinks

alexander_686 Re:Production (230 comments)

Of course as industry practice, Apple likely makes component pre-payments based on forecast demand on a discount basis (which gives Samsung funds to finance it), but that's not the same as an equity investment.

When I was talking about "investments" I was actually referring to this type of arrangement. Not all investments have to be equity. Some can be simple short term loans to finance inventory and production. That being said, some of the arrangements can be huge, complex, and multi-year and can get pretty near the line of equity. But if not the marriage of equity at the very least it is a very deep partnership of cohabitation. See GT as an example. Of course, the accountants make sure it never crosses the line into equity – that tends to open a can of worms - and often it must be publicly disclosed.

As for Corning I was a bit lazy when I said that Apple invested billions in Corning – I don't know the exact amount or level of involvement. I do know that Apple did help Corning with cash in order to ramp up production in exchange for a limited time exclusive on the glass.

about three weeks ago
top

AMD, Nvidia Reportedly Tripped Up On Process Shrinks

alexander_686 Re:Production (230 comments)

Apple didn't spend their own money on production of their "special" glass (it is purchased gorilla glass 4 from Dow Corning)...
On that whole GT advanced technologies sapphilre disaster, they attempted to purchase their own production labs (and lease them back to GT for production), but apparently that ain't gonna happen now...

That is not true. Apple has invested billions in Corning, Samsung, Foxconn, etc. You have only heard about GT because it blew up.

It is not uncommon for a customer to help finance a vendor's factor. Why should a company (let's day Corning) build a huge, risky, cutting edge factory? It is a huge risk. Why should a company (let's say Apple) design a product around cutting edge technology that might not be available in mass quantities?

So Apple pitches in cash to finance the new factory and in return they get preferred pricing / exclusive rights of the output for 6 to 12 months.

As an example, Tesla's "Gigafactory" is actually a Panasonic factory.

about three weeks ago
top

AMD, Nvidia Reportedly Tripped Up On Process Shrinks

alexander_686 Re:Samsung? (230 comments)

Actually, they may not. It boils down to what you define as "Samsung". "Samsung" is a lose collection of companies with crossholdings. IIRC, the fab plants are in a different company than the company that does the cell phones. Besides, just because you can make one bit of the phone (CPU) does not mean are the best at making other bits of the phone. I think they have farmed out the cell network bits out.

about three weeks ago

Submissions

top

Microsoft to Buy Nokia's Devices Unit for $7.2 Billion

alexander_686 alexander_686 writes  |  about a year ago

alexander_686 (957440) writes "On the heels of CEO Steve Ballmer announcing his resignation, it looks like Microsoft is going to be buying Nokia’s handset unit. Nokia is currently a big cheerleader for the Window’s 8 phone. Stephen Elop was a Microsoft employee, then Nokia’s CEO, and is now stepping down. He will be the head of the handset division after the sale is finial. Elop is the current front runner to replace Ballmer when he steps down in a year."
Link to Original Source
top

Microsoft may invest $1B-$3B in Dell buyout

alexander_686 alexander_686 writes  |  about 2 years ago

alexander_686 (957440) writes "We have talked about Michele Dell In Buyout Talks With Private-Equity Firms

Now the Talk is that Microsoft may invest 1 to 3 billion. I personally doubt Microsoft is going for majority ownership but it would be a significant stake. Dell is worth around 22b to 25b. Speculation is that investors would put up 5 to 7b in equity, borrowing the rest. You can do the math to determine the ownership percentage. As a point of reference, Michele Dell’s stock is worth 3.6b

We know about Microsoft’s relationship with Nokia – both in terms of ownership, swap of key personal, and the Window’s phone. Is this a repeat?"

Link to Original Source
top

AT&T- Verizon collude to offer poor service

alexander_686 alexander_686 writes  |  more than 2 years ago

alexander_686 writes "I recently found a very good about article How AT&T and Verizon Manipulate Your Smartphone by Susan Crawford. It’s the 2nd excerpt from her book “Captive Audience.”

The two kinds of Internet-access carriers, wired and wireless, have found they can operate without competing with each other. The cable industry and AT&T- Verizon have divided up the world much as Comcast and Time Warner did; only instead of, “You take Philadelphia, I’ll take Minneapolis,” it’s, “You take wired, I’ll take wireless.”

I am a free market type of guy. I do recognize the abuse that can come from natural monopolies that utilities tend to have, but I have never considered this type of collusion before."
Link to Original Source

top

SEC investigates Netflix CEO Reed Hastings over Facebook Posting

alexander_686 alexander_686 writes  |  more than 2 years ago

alexander_686 (957440) writes "SEC investigates Netflix CEO Reed Hastings on Facebook Posting

Hastings said in the filing the SEC is questioning his July 1 Facebook posting, seen by 200,000 followers, in which he said customers watched “over 1 billion hours” of videos on Netflix in June. He had previously posted on his company blog that members were viewing “nearly a billion hours per month.”

Rarely, outside of Carl Sagan, have I heard people saying that one billion not significant."

Link to Original Source
top

Knight Trading Losses

alexander_686 alexander_686 writes  |  more than 2 years ago

alexander_686 writes "Apparently old code never dies – it comes back to haunt you.

From Bloomberg, "Knight Capital Group Inc. (KCG)’s $440 million trading loss stemmed from an old set of computer software that was inadvertently reactivated when a new program was installed, according to two people briefed on the matter.""

Link to Original Source
top

Harvard and MIT to provided online classes

alexander_686 alexander_686 writes  |  more than 2 years ago

alexander_686 writes "Harvard and MIT are launching edX with 60 million dollars to offer “low fee” online classes. No word yet on classes offered or who will be teaching. No college credit but certificates will be offered.

The technology used will be open source. Other institutions will be invited at a later date.

I hope low cost means low cost. (Under $25) I have really enjoyed the Stanford University free online classes."

Link to Original Source
top

The Nook: From Android to Windows?

alexander_686 alexander_686 writes  |  more than 2 years ago

alexander_686 writes "It looks like Microsoft is buying a large chunk of Barnes & Noble, specifically the Nook and it’s college businesses. While nobody has said anything specific, I think the writing is on the wall on what the next OS system for the next nook is going to be."
Link to Original Source

Journals

alexander_686 has no journal entries.

Slashdot Login

Need an Account?

Forgot your password?