Bet on Microsoft

If I had one thing to say about the current state of business I would say this:
Microsoft is about to do something real big. They are fully focused and hungry.
I been interviewing with quite a few different types of companies, but none like Microsoft. Most big companies don't know their big and aren't aware of the problems in such a state. MS has moved beyond that stage and knows what they are. It took them some time to snap out of it, but they are back. The key of it all is this. Yahoo lost it's engineering power. Oracle lost their engineering power. Google hasn't. That is where the battle front really is, with the technology and not with the businessmen. MS has realized this finally. Visa is set to IPO. I would bet on them also. If you bought Mastercard stock when they IPO'd two years you would have gotten a 5 fold return.

Haters will Hate

A wise man once said that he only tells people one third of what he's doing. That way, they can hate, only on that 1/3rd. W1, can't you relate? You always had a few haters to deal with at any given time. Are you hater free now? Nonetheless, it has been interesting to see so many companies partner with Yahoo in order to keep them from Microsoft. I guess the enemy of my enemy is a friend concept is being played out live and in the flesh. Every software, web type of company is doing their best to prevent the merger. Newscorp, AOL, Google are the biggest three conspirators but there are a lot of underground conversations being had as well. All of the MS haters are trying to coax Yahoo into maintaining their sovereignty.

The High Definition DVD battle is now over. Why? Because Best Buy and Walmart said so. This is something to take a note of. The specification of choice was decided by the Channel and not the customer. When businesses make decision, it usually has to do with profit and not the consumer. So basically we as consumers sat back and allowed the most expensive DVD format to win. Ignorance is bliss, and also expensive. This is scary. When the channel has influence on the development, this usually spells doom for the consumer.

Microsoft + Yahoo = Google

Before discussing the aforementioned title I just wanted to point out that Exxon had a record setting year last year, and so did Shell. Our President and his staff made large sums of money due to their oil investments(Yes, Condeleeza too).

They also will get a tax break. Our President's earnings will be more recession proof than any other citizen in the country. Somehow this reminds me of the dictators and warlords revenue structure which is to make more than everyone else and to profit on his own people's suffering.

Google is a combination of Microsoft and Yahoo with a little bit of Bell sprinkled in. They started off as a service based search engine like yahoo and evolved to a software company. Microsoft is a software company trying to profit off of web activity like Google and Yahoo.

Meanwhile, the latter is a web company that lacks the ability to become a software company. The software is what will allow them to expand and they don't have the business and technical savvy to grow at the previous rates. Google is adding infrastructure and utilities to their tool belt. This gives them more name power than Microsoft because Google can provide a larger solution. Yahoo stopped playing chess and ran out of options.

I told this to MS today when I interviewed with them in verbatim(almost anyway).
I told them that Google was their number 1 threat and them bidding on Yahoo was a testament.

They had a philosophical interview and asked the following:
What the difference between leadership and management
What is the difference between vision and strategy
What is the difference in a core problem and a symptom
What is the difference between small and large company

How do you think I did getting asked those questions?
The goal is to be so good that they allow me to work in the Bay.

JT Morgan, The Engineering Capitalist!

RIP Netscape

It was a true American classic that enabled today. Without it, how would things be currently? On a personal note, it gave you a job and launched you down your path.

Executive Compensation-How much can a CEO make?

Every company is required to report the compensation structure of their highest ranking employees (Form 8K). This information is public. But basically, the CEO can make an extra 250% of their salary if things go well. The other C's(CFO, CTO, COO) can make around 125 more percent of their's. These critical mass position for the lucrative bonuses starts usually around the Director title at about 130%. See below for the specifics about a high tech company's executive compensation plan.

Our Chief Executive Officer, Chief Financial Officer, the three other most-highly-compensated officers, all other officers, as well as other key employees, are eligible to participate in the Bonus Plan.
Bonuses payable to our CEO and other officers who are subject to Section 16 of the Securities Exchange Act of 1934, as amended (collectively, the "Executive Officers") under the Bonus Plan will be determined by the Compensation Committee.
The target and maximum payouts, both of which are a percentage of base salary, that may be earned by each of our Executive Officers are as follows:
MAXIMUM
POSITION TARGET % PAYOUT %
CEO 100 200
CFO 60 120
SENIOR VICE PRESIDENT 60 120
VICE PRESIDENT 50 100

Under the Bonus Plan, actual payouts to the Executive Officers will be determined by the Compensation Committee based on a formula that takes into account (1) operating income as a percentage of revenue for 2008 (the "Financial Performance Metric") and (2) individual performance (the "Individual Performance Metric"). The Financial Performance Metric will determine the Potential Payout percentage (as specified in the table below) that may be earned by an Executive Officer, and the Individual Performance Metric will then be applied as a multiplier to determine the actual payout. The formula which the Compensation Committee will use to calculate the actual payouts to the Executive Officers (which are subject to the Maximum Payout Percentages specified above) is as follows:
Base Salary * (Target % * Potential Payout % * Individual Performance Metric %) = Actual Payout.
________________________________________
The Financial Performance Metric under the Bonus Plan will be operating income as a percentage of revenue for 2008. Operating income is defined as earnings before income, interest expense, and taxes. The Compensation Committee shall have discretion to exclude from the calculation of the Financial Performance Metric significant, non-recurring items. The Potential Payout Percentage will be calculated based on the following table:
Potential
Operating Income as % of Revenue Payout %
Less than 22 0
22 20
23 30
24 50
25 70
26 90
27 100
28 130
29 160
30 190
31 or higher 200

If the results of the Financial Performance Metric do not appear on the above table, the Potential Payout Percentage shall be calculated on a proportional basis. For example, if 2008 operating income as a percentage of revenue is 25.5%, the Potential Payout Percentage will be 80%.
The Individual Performance Metric will be determined by the Compensation Committee as follows:
• 70% will be based on the individual's performance against specific goals that have been approved by the Board of Directors in the case of the CEO and by the Compensation Committee in the case of other Executive Officers. Individual performance goals may have different weightings.
• 30% will be based on the Compensation Committee's subjective assessment of the overall performance of each Executive Officer.
The Individual Performance Metric may range from 0-125%. In evaluating the performance of the Executive Officers other than the CEO, the Compensation Committee will take into account the CEO's evaluation of whether an individual has met his or her performance goals and the CEO's subjective assessment of overall performance. In evaluating the performance of the CEO, the Compensation Committee may take into account the CEO's self-assessment as well as the assessment of the independent members of the Board of Directors. The Compensation Committee's determination as to whether individual performance goals have been met may be subjective in nature.
Payment of bonuses (if any) will be made in February or early March of 2009. Bonuses normally will be paid in cash in a single lump sum, subject to payroll taxes and tax withholdings.

My kind of Hunter

Did you ever read Hunter S. Thompson on ESPN? He was straight profound.
10 of his greatest quotes have been captured in the link below.

"Myths and legends die hard in America. We love them for the extra dimension they provide, the illusion of near-infinite possibility to erase the narrow confines of most men's reality. Weird heroes and mould-breaking champions exist as living proof to those who need it that the tyranny of 'the rat race' is not yet final."

"If I'd written the truth I knew for the past ten years, about 600 people—including me—would be rotting in prison cells from Rio to Seattle today. Absolute truth is a very rare and dangerous commodity in the context of professional journalism."
—Rolling Stone, February 15, 1973

LINK

Bank of America will flip the Countrywide house

Bank of America's purchase of Countrywide last week is monumental. Humans like to write off people or things when they are down. From Bank of America's standpoint, 4.1 billion dollars is small change. They are the number 1 Bank in our country and just purchased 7 million new customers. The merger of consumer banking and mortgages will now begin to merge. All of the investment banks turned consumer banks like JP Morgan and Citi will need a mortgage group because now B of A got the Randy Moss of their industry. I think the SEC would block this if Countrywide was not on the verge of collapse. Once Bank of America gets a personal insurance companyy they will own us. There are great risks and rewards to this situation in the short term, but the long term view will be profoundly great for them.

The risks are pending lawsuits against Countrywide and the potentially high number of loan defaults. Bank of America most likely safeguarded themselves against these two calamities, but they can still be damaging in some uncovered angle. They don't need to make a profit on these loans, just the lowest cost resolution. Any profit would be an added bonus.

There are many positive aspects. It all depends on their highest margin business. This acquisition gives them a new way to feature and display their bread winner. The key here is that B of A doesn't have to make any profit on the mortgages they acquired. It's actually more important for them to minimize loss. As a result they can find a solution that works for them that wouldn't have worked for stand-alone Countrywide. They got a stellar business process for cheap. This is a Cashflow Quadrant concept. Bank of America bought their processes and customers for dirt cheap.

LINK!

Automatic Millionaire

In my spare time I also read this lovely morsel of nothing called The Automatic Millionaire. The premise of this book was basically ignorant compounding. Automatic meaning adjust once and never really doing anything afterwards. The premise is that you will a millionaire in 26 years by using automatic banking for savings, principal pre-payment, and investing money that would be normally wasted.

Cashflow Quadrant

I had a chance to read Cashflow Quadrant by the Rich Dad Poor Dad author. This book provides more of an realistic example than his previous title. The concept of this book is categorize investors by the way they earn their money. The book helps you determine if you are an employee, a contractor, a business owner, or an investor. Then the book defines the thought processes and limitations of each group. He then explains why living on the right side of the quadrant as either a business owner or investor is the preferred mode. After getting everyone in line with the proper thought processes he then explain how to make money as a B or I.

Snoop is a key character

It took me some to time to determine if Snoop was a boy or girl.
I was getting her mixed up with the boy who had the pony tail with the jacked up mother. My favorite character is Michael. He has the most potential. He is like young Anakin and can shift the balance of power. I think he will kill Marlowe at the end.

The Wire is one of the best shows in history

What!
I've always watched the Wire. It's getting real good now. I was saddened when old boy got killed last year. He was a staple. The show is done by a former detective and beat writer. So the stories they tell are very realistic. The Wire is like Baltimore for real. It's very authentic and more than people know. I personally think it has the best black acting of any show ever. The show is full of black actors and they aren't dancing, rapping, or playing sports. There is no buffoonery or minstrel. A great show. Why doesn't it get any publicity? This is why your man Tyler Perry does so well. He shows black people in a normal light but in family situations not cops and robbers. When will HBO do a positive black series? Do you know that the the hardest guy on the show, Chris, is the most well spoken person on that show's whole staff. The one cat McNulty has a British accent like House does. I haven't talked with you about it because I thought you were scurrddddd and never watched it.

Coolest thing at CES

The big consumer tech show is currently taking place.
My personal award goes to Microvision (Click Here). They have a hand held projector.
It is size of an old school IPOD and projects at dvd level clarity.
I pick them because they are one my customers. I made a trip to Seattle last year to visit with them and get an update as to how they were doing.

It's great to see that they made it and it allows my former employer to get into a high volume consumer based product.

HD DVD vs Blue Ray

For some reason, people allow history to repeat itself even when it is bad history.
A few decades ago when the VCR was the big thing, there was a war between the two formats, VHS and Betamax.
Currently, a similar battle is taking place between Blue Ray and HD DVD. There are two factions competing for market share. Basically Blue Ray holds 50% more data but is more expensive in terms of the infrastructure behind it. The extra charge will probably be transferred over to the consumer.
This subject is now one of the hottest stories in the news and I wanted to provide some clarity without spin. Warner did not have to defect to Blue Ray because there will be large consumers of both formats due to the Video Game Industry. XBox uses the HD format and the PlayStation III uses Blue Ray. Both are being outsold by the Nintindo Wii with the XBOX being number two. There probably more HD ready consumers than Blue Ray. Warner forgot about multi million XBOX 360 users which was a big portion of their DVD revenue.

Record Industry is shady

Did you know that the Record Industry said it was illegal to rip mp3 music from CDs last week. I was flabbergasted.

If that is the case, any person who transferred the contents from a CD to their ITunes account would be subject to the law. This also means that all music being played on mp3 players could only come from digital media sources like Apple and Rhapsody.

So basically, the RIAA decided to give all of their business to Apple and to Rhapsody.
Not too clever. People who rip mp3s buy CDs. Isn't that the goal of the RIAA? They make money when people buy CDs.

I guess they realized the error of their ways and recanted.

Happy New Year

Clifton Smith finally played in college as he did in high school.
He finished at his best. I wonder can he catch on as a return man.
They're in vogue right now.

Did you know that JP Morgan and Charles Schwab were from the steel industry?
They are now synonymous with banking and finance. That is my new goal for us. We are a part of the internet(and infrastructure) industry which I equate to our generation's version of steel. We will establish our bank starting now. Hence, it's time for a new moniker. Effective immediately for 2008, JT Morgan is now the financial branch of Camptrotter.

Think and Grow Rich

Great Read
"
This book was different in terms of style. It's basically about 13 concepts of self preparation that should lead to financial success. The best way to describe it as a cross between and self help/motivational book combined with personal finance.
"

The winner is......

The New England game will be televised instead of being held for ransom by the NFL Network. Did this happen because they actually care about the fans? No. It happened because the New England Representative didn't have the NFL Network and used Congress to achieve his own personal agenda. In this situation I think his actions were justifiable because it is a better thing for all of America. What is not acceptable is when personal agenda's help the one individual and harm the everyone else like many other ideas in the past.

This topic was discussed here a week ago, and I now stand corrected. For the first time in my life, being wrong is actually a better thing.

And then it hit me

Getting laid off is not cool. Having it happen before Christmas is even worse. If your wife is also pregnant during that time, it's all bad. Those are the issues currently on my plate and I've been dealing with them quite well. I never imagined how I would feel if something like this were to happen, but it did, and things weren't that bad.

Then I spoke to my sister. She told me not to buy anyone anything for Christmas. I have been getting gifts for my family since I was a child. Even though my parents financed the gifts that I got them, I still participated.

When my sister said not to buy her anything, it really hit me. I failed to provide this Christmas. I can only imagine the devastation my unborn would feel if I couldn't provide on the biggest Holiday of the year. I will never let this happen again, I promise that. I will not allow myself to be in such a vulnerable state ever again. A setback is a setup for a comeback and mine will be greater than anything Elway ever did. I kid you not!!!!

Flip this House

In my boredom, I will periodically watch shows such as "Flip this House".
One of the main characters on this week's episode is named JD Esagian.
That name sounded very familiar and then they showed some high school football highlights of the 3 business partners. Then I realized that I played against the guy in high school. He played for Roosevelt. I wouldn't mention this, but you know that I was a functional tackler instead of a violent collision type of guy. The hardest hit of my life ever delivered was against this gentleman that I am looking at on TV. It's a small world, but this is a sign. That hit was one of my last examples of perfection, and I needed to be reminded.

JD if you're reading this, think back to your final high school football game when you played Sanger. Do you remember getting blown up near your goaline? If so, it was I. Thank you for the moment and good luck with your future housing endeavors.

Big Cable vs Big Football vs US government = less revenue and enjoyment

http://sports.yahoo.com/nfl/news;_ylt=Are27nnXlQg0zy
QLjZ0bEWRDubYF?slug=ap-senate-nflnetwork&prov=ap&type=lgns

It looks like the Thursday night football on the NFL network issue finally reached the halls of Congress. The NFL reached a negotiation stalemate with Comcast and TimeWarner Cable.
The key factor here is that none of this has to with us the football consumers.
Neither the NFL nor cable has done anything to bring me the games that I want to watch. Instead we're forced to watch the local teams, which is great if you happened to grow up here but is not cool otherwise. The NFL and Cable companies are using technology to make their business practices more complex, but not better. Don't they realize that people will pay to watch their favorite teams and there is more money to be made that way than any other solution they are thinking about? They are operating for short term money, when they realize the market that is available for fans being able to watch their favorite teams. It's neat to see monopolies fight against monopolies.