Pricing goods on the supermarket shelves is as much an art as it is a
science. More often than not the end result - a price, reflects the
logical outcome of all the input factors. From time to time, however we
get an output - a price that seems to defy logic. We can only conclude
one of two things - either our assumptions about the way the world
works need to be revisited or - there is just a quirk, an oddity, an
outlier.
As an investment manager I'm trained to look for the outliers.
Buying or selling an outlier can make the difference between having
average performance and having above average or below average
performance.
Finding the outlier makes a trip to the supermarket or shopping mall
more interesting and more fun. It's a bit of a hobby for me. Some
people spot planes and trains. Some people follow the minute details of
sports statistics. I follow prices.
Our journey in search of the pricing outliers begins of course at the
manufacturer on the desk of the Product Manager. The Product Manager is
in charge of practically every element of brand and product
development, from the look and feel of the packaging, timing and
delivery of advertisements, wholesale pricing, promotional pricing and
finally, MSRP or manufacturer's suggested retail price.
Whenever I go to the supermarket I pay attention to prices, in part
because, like every consumer, I want my hard earned dollars, koruna,
pounds, rubles and yen to go as far as they can. Aside from the
practical implications of smary buying, I'm always interested to finding
what I call pricing idiosyncrasies - the quirks or departures from would seem to be the norm or logical progression.
Lately the biggest quirk I've seen is in the instant coffee aisle. I
happen to shop in Prague very often. The local currency is the Czech
Koruna, so I'll reference my local currency. Also to be consistent we
will talk about 200g packages. Those of you in other countries can
substitute numbers proportionally. Makes no difference.
When I am in the US I drink Taster's Choice. Here in the Czech Republic we don't have that brand. We have NesCafe, which it so happens is a product of the same fine company that makes Taster's Choice.
Pricing in the instant coffee aisle works something like this: the
stuff that tries to be something reminiscent of coffee sells for Kc 60.
Then the store brands sell for somewhere between Kc 75 and Kc 99.
Lidl, a local supermarket I shop in, sells a private label brand called Green Eclipse which is just wonderful. It sells for Kc 79 and sometimes it's on sale for Kc 69.
I buy Green Eclipse because I like the taste, but also I especially
like the price. I the taste were lousy I wouldn't buy it. Life is too
short to drink bad coffee at any price.
Between Kc79 and Kc 160, there is nearly nothing to speak of. It's
what I call the DMZ - the de-militarized zone. It is practically an
empty, barren wasteland.
After that the mainline brands start. The major brands include Jacobs, Douwe Egberts, Tchibo
and Nescafe, with prices ranging from 159 to 259. Premium coffees,
including the "Gold" versions of the mainline brands, cost usually
between 199 and 259. The very top of line is Davidoff, which prices at 390. It's sold in 100g packs at 199.
I
think the biggest indication that product managers are getting nervous
is when they develop brand line extensions and odd pack sizes. For
example, a number of brands have introduced "velvet" or finely ground
variations, are lower priced. Also some of the brands have pack sizes
of 95g, 180g and 190g. This makes direct price comparisons hard to make
and also enables them to meet price point targets.
Pricing Quirk Number 1 - A Range Big Enough to Drive a Truck Through
Pricing variations in the coffee aisle are among the widest I can
find in the supermarket. Producers seem to believe that once the
consumer finds the right taste price sensitivity ends. What producers
seem to miss is propensity among consumers to substitute.
I find it hard to believe I am really very different from the average
consumer. I like the taste of NesCafe. It's my favorite coffee except
for Taster's Choice. But it's not my favorite coffee at any price.
For every jar of NesCafe or I can have at least two jars of the
Eclipse. NesCafe is among the less expensive of the mainline bands. For
some of the other brands the ratio is more like 3 jars of Eclipse or 1
and a half jars of NesCafe for 1 jar of the main brand.
I just don't understand this pricing case. If coffees like Eclipse
are readily available, why should mainline brands be two, three, four
times more expensive. And why should such large price dispersions occur
within the mainline brands. Do people care so much about taste?
Shouldn't propensity to substitute be greater or is there something else
I am missing here? Consumers respond to the weekly supermarket sales
circulars and switch supermarkets at the drop of hat when they see
laundry detergent on sale. But once inside the market they don't care
about what they pay for coffee?
Pricing Quirk Number 2 - The De-militarised Zone in Pricing
Between Kc 79 and Kc 159 the pickings are few and far between. My
guess is that the product manager doesn't have a lot of influence at
this level and the pricing battle shifts to the supermarkets. Pricing
managers in supermarkets well understand the behavior of consumers and
where the elasticity of demand can vary. Pricing managers also look at
gross margin - the the difference between what the price at the cash
register and the price from the manufacturer. Still - why should there
be this big gap in pricing 50% - 100% between the bargain brand and
the mainstream brands?
Pricing Quirk Number 3 - Putting the best value for money on sale
Why should something that's already priced well go on sale? This
coffee is the best value for money! I hardly think the sales will
change much when it goes on sale. Demand is probably pretty inelastic
at that level. Makes no sense to me!
And yet - incredible as it may seem, Eclipse sometimes goes on sale, with a big red sign pointing out the 10% discount.
Pricing Quirk Number 4 - Putting the Brands on Sale
From
time to time NesCafe runs a promotion. They price the 200g bottle down
to 119. This is still a hefty 50% premium to Eclipse, but a is a
healthy discount to the other main line brands. At that price my price
sensitivity goes out the window and the taste devil drives my decision.
I stock up. I'll by three or four at that price and keep them in my
pantry and draw down the stash until next sale comes around. Judging by
what I observe at the cash register, many other consumers are doing the
exact same as I do. When NesCafe is on sale it seems to just fly off
the shelves.
I wonder - if NesCafe decided to change it's strategy to everyday low
pricing - say the Kc 129 level instead of the 179 or 199 level would
NesCafe's revenues go up or down?
Pricing Quirk 5 - Deep Discount Overkill
This week and next NesCafe they are pricing at 79. They've actually
gone through the pricing DMZ and are going head to head with Green
Eclipse. I'm stocking up and how and judging by what I see in the
stores, even the twenty-four/seven neighborhood convenience store owners
are doing the same.
I don't like to look a gift horse in the mouth. But I don't
understand why NesCafe felt the need go through the DMZ and go head to
head with the bargain brand. Leaving aside the velvet finely ground
products, The mainstream brand pricing starts at about 159 and the
bargain pricing ends at 99. A price point around 119 for the sale should
be more than sufficient to pick up market share from the main
competitors.
I Have More Questions than Answers - Don't You?
I'll be interested to hear what my product manager and supermarket
executive friends have to say about the enigmas of coffee pricing. I
also will be interested to hear about other pricing idiosyncracies away
from the coffee aisle. E-mail me at msonenshine@symfoniecapital.com if you have suggestions or comments.
I normally write about Angel Investing and P2P Lending. To learn more about my Angel Investment Fund click here. To learn more about our P2P Lending Fund click here.
Foreign affairs, politics, business and a slice of life. Written by Symfonie Capital CEO Michael Sonenshine
Sunday, December 27, 2015
Saturday, December 19, 2015
Franta, the Other Dog and Me
Warning! If you don't like dogs, I'm not sure you'll like what I write here. If you are a dog lover, as I am, you'll understand where I am coming from and where I am heading almost immediately.
The dog is a natural companion for the human race. I'm convinced that for as long a humans live on this planet, dogs will live side by side with them.
I'm also convinced that dogs reflect our hearts and minds. When we are nervous our dogs are nervous. When we are relaxed our dogs are are relaxed. They instinctively like some people more than other people.
Much has been written on the subject of dog behavior and in fact the school of thought on dog training has undergone a remarkable evolution. The old school of thought was based on negative ereinforcement. One example is the use of the choke chain collar. Pull the choke collar often and hard enough and the dog will start to behave differently so as to avoid the unpleasantry of the choke.
Nowadays training is based on positive reinforcement and the dynamics of the relationship between the dog and the owner. The system is reward based. Reward desirable behavior with treats and praise. Save the special treats your dog loves only for special occasions and especially good behavior.
Training also focuses on the handler. If you are nervous your dog will be nervous. If your dog runs on the neighbor's grass and barks at every passer-by on the street it's most certainly because the owner never taught the dog to do differently. I can't count the number of books I've read and TV shows I've watched where the lesson of the day was - "If you want to change the dog's behavior you must start with your own behavior."
The other modern wisdom is that dogs are inherently pack animals. They look to us as our leaders and the will follow our cues. I think this is also true. But that theory has certain limits, and this is where my story begins and ends.
Well - OK. Enough with training theories. I have a nasty habit when I write of leading my reader on a long and winding road until I reach the conclusion. This time I will do differently! I'll start with the end, go in a circle.
Franta was certainly the loser. I knew it and he knew it. But I kept a stiff upper lip. I remained calm and steadfast with an almost matter of fact, business as usual demeanor. I worried that if started coddling him and comforting him I would re-enforce Franta's feelings of nervousness and insecurity. The sooner we returned to business as usual, the better, I felt. I wanted him to just put it behind and move on.
I didn't realise it until I got home, but he had five bites along his back and hind quarters. Poor Franta! When we got home he crawled under the table and basically stayed there for the rest of the day.
To be on the safe side I took him to Vetpoint, our local vet. They give fantastic basic care at reasonable prices and are open long hours. Franta knows them well and stops there willingly during our daily walks. But still, a visit to the vet is not his favorite activity and this particular trip added immensely to his trauma. The vet took out an electric razor and removed some hair around each bite found. Franta was shaking with fear. Each bite was cleaned with topical disinfectant and that was clearly painless, for which I am thankful. Finally, Franta got an injection of a form of enroxcil, a broad spectrum antibiotic. He had an allergic reaction to that and within an hour we were back at the vet to get an antihistimine. Again, more trauma for all concerned. My wife and I sat with Franta for the better part of 3 hours while the reaction subsided.
Warning!!! Don't treat allergic reactions to antibiotics lightly. They can in fact be fatal both in animals and in humans if you don't respond quickly enough with the right treatment. Never lose sight of this fact.
Conventional wisdom is that when you start administering antibiotics you should continue the full course of dosage. If there is an infection the infection may return if the antibiotics are discontinued. If there is no infection, then no harm done by stopping the antibiotics. In Franta's case the topical areas around the bites looked kind of nasty. The vet suggested we return in 24 hours to reasses the situation.
The next day Franta was looking and feeling better. We, did a bunch of our own independent research and called Vet|Nemo, a specialist vet we go to when we need higher level care. The doctors at VetNemo invested in state-of-the-art technology. Once they treated a scratched cornea and removed a dirt particle on Franta's eye with a laser pen. Then they fitted him with a contact lens that we wore for two weeks without a problem. He was in and out the clinic in 15 minutes we paid something on the order of $100, which was a fraction of the the cost we would have paid had had we opted for anesthesia and a dull blade.
We returned to our local vet for the followup the next day and opted to continue a course of antibiotics and this time the vet used a form of amoxicillin. Franta tolerated that well and we continued a program of daily visits for the next seven days. Each visit set us back a whopping $5 and with each day Franta was better.
Today Franta is right as rain. He still has a few of the battle scars, but pretty much they are healed. He is his normal, happy go lucky self. He's no less confident around other dogs, though he's a bit more...shall we say....respectful and even perhaps aloof.
Franta and I are certainly wiser and more experienced. A lesson or two was learned the hard way. Are you curious? Read on!
I'm also convinced that dogs reflect our hearts and minds. When we are nervous our dogs are nervous. When we are relaxed our dogs are are relaxed. They instinctively like some people more than other people.
Much has been written on the subject of dog behavior and in fact the school of thought on dog training has undergone a remarkable evolution. The old school of thought was based on negative ereinforcement. One example is the use of the choke chain collar. Pull the choke collar often and hard enough and the dog will start to behave differently so as to avoid the unpleasantry of the choke.
Nowadays training is based on positive reinforcement and the dynamics of the relationship between the dog and the owner. The system is reward based. Reward desirable behavior with treats and praise. Save the special treats your dog loves only for special occasions and especially good behavior.
Training also focuses on the handler. If you are nervous your dog will be nervous. If your dog runs on the neighbor's grass and barks at every passer-by on the street it's most certainly because the owner never taught the dog to do differently. I can't count the number of books I've read and TV shows I've watched where the lesson of the day was - "If you want to change the dog's behavior you must start with your own behavior."
The other modern wisdom is that dogs are inherently pack animals. They look to us as our leaders and the will follow our cues. I think this is also true. But that theory has certain limits, and this is where my story begins and ends.
Well - OK. Enough with training theories. I have a nasty habit when I write of leading my reader on a long and winding road until I reach the conclusion. This time I will do differently! I'll start with the end, go in a circle.
The End
My dog Franta was attacked! The other dog meant business. He was seriously angry. The story might have ended very badly. The other owner and I pulled the dogs apart. Both dogs walked away, largely unhurt.Franta was certainly the loser. I knew it and he knew it. But I kept a stiff upper lip. I remained calm and steadfast with an almost matter of fact, business as usual demeanor. I worried that if started coddling him and comforting him I would re-enforce Franta's feelings of nervousness and insecurity. The sooner we returned to business as usual, the better, I felt. I wanted him to just put it behind and move on.
I didn't realise it until I got home, but he had five bites along his back and hind quarters. Poor Franta! When we got home he crawled under the table and basically stayed there for the rest of the day.
To be on the safe side I took him to Vetpoint, our local vet. They give fantastic basic care at reasonable prices and are open long hours. Franta knows them well and stops there willingly during our daily walks. But still, a visit to the vet is not his favorite activity and this particular trip added immensely to his trauma. The vet took out an electric razor and removed some hair around each bite found. Franta was shaking with fear. Each bite was cleaned with topical disinfectant and that was clearly painless, for which I am thankful. Finally, Franta got an injection of a form of enroxcil, a broad spectrum antibiotic. He had an allergic reaction to that and within an hour we were back at the vet to get an antihistimine. Again, more trauma for all concerned. My wife and I sat with Franta for the better part of 3 hours while the reaction subsided.
Warning!!! Don't treat allergic reactions to antibiotics lightly. They can in fact be fatal both in animals and in humans if you don't respond quickly enough with the right treatment. Never lose sight of this fact.
Conventional wisdom is that when you start administering antibiotics you should continue the full course of dosage. If there is an infection the infection may return if the antibiotics are discontinued. If there is no infection, then no harm done by stopping the antibiotics. In Franta's case the topical areas around the bites looked kind of nasty. The vet suggested we return in 24 hours to reasses the situation.
The next day Franta was looking and feeling better. We, did a bunch of our own independent research and called Vet|Nemo, a specialist vet we go to when we need higher level care. The doctors at VetNemo invested in state-of-the-art technology. Once they treated a scratched cornea and removed a dirt particle on Franta's eye with a laser pen. Then they fitted him with a contact lens that we wore for two weeks without a problem. He was in and out the clinic in 15 minutes we paid something on the order of $100, which was a fraction of the the cost we would have paid had had we opted for anesthesia and a dull blade.
We returned to our local vet for the followup the next day and opted to continue a course of antibiotics and this time the vet used a form of amoxicillin. Franta tolerated that well and we continued a program of daily visits for the next seven days. Each visit set us back a whopping $5 and with each day Franta was better.
All's Well that Ends Well
Today Franta is right as rain. He still has a few of the battle scars, but pretty much they are healed. He is his normal, happy go lucky self. He's no less confident around other dogs, though he's a bit more...shall we say....respectful and even perhaps aloof.
Franta and I are certainly wiser and more experienced. A lesson or two was learned the hard way. Are you curious? Read on!
The Beginning
This is Franta. He's a mut from the shelter, about 7 years old. I say he closest in appearance and temperment to a Small Munsterlander.
I'm not sure what the attacking dog is. It's not so relevant. On the other hand, this is not the first time another dog took a stab at Franta. Therefore, Franta tends to be careful around other dogs.
He developed a strategy, thanks to my good training, I must say. If he encounters another dog on the street and it looks like the meeting will not go well he keeps a safe distance from the other dog. I also taught Franta the command - "Ignore" or "Run Away." When I tell Franta to Ignore and he is on leash he knows to quickly pass the other dog by and move on. If he is off leash and I tell him to Ignore or Run Away he keeps a safe distance from the other dog. Mostly he uses his own good instinct. I only give him the command if I want to express to him my own personal doubts.
I also taught him the command "Kamaradit" or "Say Hello!" That tells Franta the other dog looks pretty harmless and he should greet nicely.
He developed a strategy, thanks to my good training, I must say. If he encounters another dog on the street and it looks like the meeting will not go well he keeps a safe distance from the other dog. I also taught Franta the command - "Ignore" or "Run Away." When I tell Franta to Ignore and he is on leash he knows to quickly pass the other dog by and move on. If he is off leash and I tell him to Ignore or Run Away he keeps a safe distance from the other dog. Mostly he uses his own good instinct. I only give him the command if I want to express to him my own personal doubts.
I also taught him the command "Kamaradit" or "Say Hello!" That tells Franta the other dog looks pretty harmless and he should greet nicely.
Maybe it's not so important to me what kind of breed the attacking dog is, but Franta takes no chances. Like many other dogs he's had some unpleasant encounters along the way. In Franta's mind all brown labrador retrievers are to be avoided. Also on Franta's bad list are large black furry dogs and rotweiler/doberman combinations.
Franta likes to create his own brand of mischief that in fact I have tried hard to deter him from. He has a game I call "fence chase." The game goes something like this. Find a dog minding his own business in his own front yard. The fence of course is a safe barrier for both dogs, which is what Franta wants. I think usually Franta initiates the ensuing game of chase back and forth along the fence. I know it's a game for Franta, but I don't think the other dog always knows it's a game and certainly it's not a good recipe for a quiet peaceful day in the neighborhood.
I've worked hard to get Franta to kick the fence chase habit. He's getting the message, but he is mischievious and OK I admit it....I have not trained him well enough.
I've worked hard to get Franta to kick the fence chase habit. He's getting the message, but he is mischievious and OK I admit it....I have not trained him well enough.
Once Franta and I were out walking in the neighborhood and he spotted one of his supposed fence chase playmates. Franta and I were out on a Sunday stroll and this dog, a German Shepherd, was, to Franta's surprise, not behind the fence, but also out on his Sunday afternoon stroll and also, I believe, off leash.
Franta froze stifff and went into his hunting dog poise. He saw this dog maybe twenty or thirty meters away and Franta was staring in disbelief, tail up, body stretch out, focused on what lay ahead.
Then Franta looked at me and started wimpering and took an immediate left up a side street. No doubt about it. Franta was not going to press his luck. Clearly, Franta had no interest in meeting this dog without the presence of a fence.
Franta froze stifff and went into his hunting dog poise. He saw this dog maybe twenty or thirty meters away and Franta was staring in disbelief, tail up, body stretch out, focused on what lay ahead.
Then Franta looked at me and started wimpering and took an immediate left up a side street. No doubt about it. Franta was not going to press his luck. Clearly, Franta had no interest in meeting this dog without the presence of a fence.
The Middle
Prague is full of dog lovers. They go to the park, their dogs meet, run around a play happily. Rarely if ever there is a bad outcome. One dog will growl or snarl at another and both will immediately keep their respectful distances. That's what the professionals call - socialisation. Dogs learn how to behave around other dogs by simply being around other dogs in an open space like a park. Often they develop a sort of commraderie, with one dog leading the way, sniffing out a trail, writing and reading what some people I know call p-mail and the other dog determined to sniff a p-mail or anything and everything that interested the first dog.
This is not the case in many other Czech towns, however. Brno, a city to the south of Prague, has leash laws. Dog owners are expected to keep their dog on a leash. A dog may roam freely provided the dog wears a cage over the snout. This way nobody's dog will bite someone or someone else's dog.
The unfortunate result is that dogs are poorly socialised. They are nervous whenever they approach another dog. The cage over their snout clearly doesn't boost their sense of security. I won't put a cage on Franta's snout if I let him walk free. I know Franta well enough to know he won't attack. If Franta were attacked I want Franta to be able to defend himself.
If you walk your dog without a leash and snout cage and another dog owner sees you the person looks at you like you are some kind of anti-social, misbehaved outlaw. Which, in fact, in that situation you are.
I think the the attaching dog looked something like this:
Franta and I were having a pleasant, uneventful walk, when we spotted a newly built dog park. The soon to be attacker and his owner were enjoying the obstacle course. The dog was gleefully running up and down the ramp, jumping through the tire, following his owner's lead. Franta watched, seemingly fascinated.
Franta looked at me as he approached the fence. "No," I told him. "Let's go." But by then it was too late. The other dog saw Franta and approached the fence, quite cautiously, in fact. From my point about five meters away, I saw what looked to be a polite, uneventful greeting any two dogs meeting outdoors might have.
Then, suddenly, things took a big turn for the worse. Both dogs were barking and growling. And then it happened. The dog that looked so happy and care free in the park was practically drooling. He was barking ferociously and baring his teeth. Then, suddenly, he found the gap between the gate and the ground just large enough to crawl through.
Before I could get there, he pounced on Franta. He was angry and Franta was clearly frightened. Franta didn't even try and engage the other dog. He turned an ran. And every time he ran the other dog ran after him and pounced on top of him.
It's all sort of a blur now. I remember running toward the two dogs. I saw Franta running certainly toward me, then away from me, then toward me. And then the next thing I know both dogs were right in front of me. By that time the other owner had also joined the fray. He couldn't seem to catch either dog. Luckily I managed to grab the attacker by the scruff of his neck and pulled him off Franta, long enough for the other owner to take control off his dog.
It's amazing how quickly dogs become calm when there is a meter or two of distance between them. The other owner apologised profusely. He was quite angry at his dog. He explained to me that his dog had been attacked in the past and was frightened and defensive around other dogs. I suppose this dog's idea of a good defense is to strike pre-emptively.
I don't discount the possibility that Franta actually provoked the other dog through the fence. Franta may have thought his favorite fence chase game was about to start. He certainly hadn't expected the other dog would crawl under the fence and attack.
Franta was visibly shaken but appeared otherwise unhurt. I decided it was best we went home, which we did. It was only after we got home that the reality of what happened began to set in.
My wife was furious with me. Franta means the world to her and I put her pride and joy, her friend, her good smart Franta into harms way. She tried to be as understanding and calm as possible, but I can tell she was seething. I think she'd be devastated if something terrible happened to him and I think she'd be even more devastated if that something were the direct result of my actions.
Finally, when I told my wife what happened I realised how preventable the whole situation in fact was. It was a disaster waiting to happen, I should have seen it coming, and I should have, could have, avoided it.
We were in Brno, a place where I know dogs generally are more nervous, less well socialised. There was Franta on one side of a fence and a nervous dog on the other side of the fence. Whenever Franta and I go for a walk in our neighborhood I make a point of keeping Franta from playing his fence game. Before he even can start to play that game I tell him No or a I walk him in a different direction. So what went wrong this time?
First, I didn't generalise the problem of the fences. In the neighborhood the fence is either accompanied by a hedge or constructed from wood planks that make it difficult for the dogs to actually see each other well. Also in the neighborhood there is no gap between the fence and the ground. I can't recall seeing a dog in our neighborhood escape from the yard. Homeowners in our neighborhood are especially alert to the possibility their dog will find a gap so any gaps are quickly repaired. Third, I didn't see the gap. If I saw the gap, I didn't expect the other dog would go on the offensive.
In retrospect I now understand the problem. There's something that air-traffic controllers speak of called "situational awareness." This is the ability to identify, process, and comprehend the critical elements of information about what is happening to the team with regards to the mission. More simply, it's knowing what is going on around you.
Air traffic controllers are trained to be alert to the relative positions of the aircraft in their space at all times. They never ignore the aircraft in their sector. They know where each aircraft is, but they are not tracking each and every aircraft per se. Instead, they are watching gaps. When they look at their screens they instantly know if the gap between two points of light is closing too quickly or not. In short, they understand and are sensitive to everything that is going on around them at all times.
I'm a credit manager. I can spot a good credit from a bad credit a mile away. That's my job. That's what I do. So naturally, when I am doing my job I'm watching every gap. My success as a bond manager depends vitally not so much on spotting what is going right, but rather on being vigilant for what can go wrong and making the appropriate change of course.
But when I go out with Franta I'm not so alert. Going out with Franta is something I do to relax, unwind, and take a break from looking at what can go wrong. And therein lies the problem.
Franta seems to have put the tragedy behind him. He's maybe a bit more careful around other dogs, but he enjoys meeting them - especially the females!
Franta passed by two fences in our neighborhood last week when we were out on our walk. He didn't stop to play the chase game. Just goes to show you....
If you walk your dog without a leash and snout cage and another dog owner sees you the person looks at you like you are some kind of anti-social, misbehaved outlaw. Which, in fact, in that situation you are.
So What Happened?
I think the the attaching dog looked something like this:
Franta and I were having a pleasant, uneventful walk, when we spotted a newly built dog park. The soon to be attacker and his owner were enjoying the obstacle course. The dog was gleefully running up and down the ramp, jumping through the tire, following his owner's lead. Franta watched, seemingly fascinated.
Franta looked at me as he approached the fence. "No," I told him. "Let's go." But by then it was too late. The other dog saw Franta and approached the fence, quite cautiously, in fact. From my point about five meters away, I saw what looked to be a polite, uneventful greeting any two dogs meeting outdoors might have.
Then, suddenly, things took a big turn for the worse. Both dogs were barking and growling. And then it happened. The dog that looked so happy and care free in the park was practically drooling. He was barking ferociously and baring his teeth. Then, suddenly, he found the gap between the gate and the ground just large enough to crawl through.
Before I could get there, he pounced on Franta. He was angry and Franta was clearly frightened. Franta didn't even try and engage the other dog. He turned an ran. And every time he ran the other dog ran after him and pounced on top of him.
It's all sort of a blur now. I remember running toward the two dogs. I saw Franta running certainly toward me, then away from me, then toward me. And then the next thing I know both dogs were right in front of me. By that time the other owner had also joined the fray. He couldn't seem to catch either dog. Luckily I managed to grab the attacker by the scruff of his neck and pulled him off Franta, long enough for the other owner to take control off his dog.
The Calm After the Storm
Now apart, both dogs started to settle down almost immediately. I stood between Franta and the other dog like the referee at a boxing match. I created basically a no-dogs land - a buffer zone of about 3 meters between the two dogs.It's amazing how quickly dogs become calm when there is a meter or two of distance between them. The other owner apologised profusely. He was quite angry at his dog. He explained to me that his dog had been attacked in the past and was frightened and defensive around other dogs. I suppose this dog's idea of a good defense is to strike pre-emptively.
I don't discount the possibility that Franta actually provoked the other dog through the fence. Franta may have thought his favorite fence chase game was about to start. He certainly hadn't expected the other dog would crawl under the fence and attack.
Franta was visibly shaken but appeared otherwise unhurt. I decided it was best we went home, which we did. It was only after we got home that the reality of what happened began to set in.
Reality Sets In
Firstly I noticed Franta was bleeding - not a lot, but enough that I could find places where the other dog had gotten a hold of Franta and actually pierced the skin. Second, I realised how traumatic the experience was for Franta. He crawled under a table and wouldn't come out for the better part of the afternoon.My wife was furious with me. Franta means the world to her and I put her pride and joy, her friend, her good smart Franta into harms way. She tried to be as understanding and calm as possible, but I can tell she was seething. I think she'd be devastated if something terrible happened to him and I think she'd be even more devastated if that something were the direct result of my actions.
Finally, when I told my wife what happened I realised how preventable the whole situation in fact was. It was a disaster waiting to happen, I should have seen it coming, and I should have, could have, avoided it.
We were in Brno, a place where I know dogs generally are more nervous, less well socialised. There was Franta on one side of a fence and a nervous dog on the other side of the fence. Whenever Franta and I go for a walk in our neighborhood I make a point of keeping Franta from playing his fence game. Before he even can start to play that game I tell him No or a I walk him in a different direction. So what went wrong this time?
Situational Awareness
First, I didn't generalise the problem of the fences. In the neighborhood the fence is either accompanied by a hedge or constructed from wood planks that make it difficult for the dogs to actually see each other well. Also in the neighborhood there is no gap between the fence and the ground. I can't recall seeing a dog in our neighborhood escape from the yard. Homeowners in our neighborhood are especially alert to the possibility their dog will find a gap so any gaps are quickly repaired. Third, I didn't see the gap. If I saw the gap, I didn't expect the other dog would go on the offensive.
In retrospect I now understand the problem. There's something that air-traffic controllers speak of called "situational awareness." This is the ability to identify, process, and comprehend the critical elements of information about what is happening to the team with regards to the mission. More simply, it's knowing what is going on around you.
Air traffic controllers are trained to be alert to the relative positions of the aircraft in their space at all times. They never ignore the aircraft in their sector. They know where each aircraft is, but they are not tracking each and every aircraft per se. Instead, they are watching gaps. When they look at their screens they instantly know if the gap between two points of light is closing too quickly or not. In short, they understand and are sensitive to everything that is going on around them at all times.
I'm a credit manager. I can spot a good credit from a bad credit a mile away. That's my job. That's what I do. So naturally, when I am doing my job I'm watching every gap. My success as a bond manager depends vitally not so much on spotting what is going right, but rather on being vigilant for what can go wrong and making the appropriate change of course.
But when I go out with Franta I'm not so alert. Going out with Franta is something I do to relax, unwind, and take a break from looking at what can go wrong. And therein lies the problem.
The Morals of the Story
When we take our blessings for granted, when we allow ourselves to become complacent, when we stop looking out at the world around us, we risk losing the things most dear to us and that make our lives most meaningful.Franta seems to have put the tragedy behind him. He's maybe a bit more careful around other dogs, but he enjoys meeting them - especially the females!
Franta passed by two fences in our neighborhood last week when we were out on our walk. He didn't stop to play the chase game. Just goes to show you....
- Never reinforce a dog's sense of fear.
- A fearful dog becomes an attacking dog or a neurotic dog who can't enjoy the pleasures of relating to his or hear own kind.
- Don't get complacent or drop your guard when you are out walking with your dog! Enjoy the walk, yes, but don't lose sight of the situation around you.
- Be proactive and present in life. Know where you are, what is happening around you and look out for what can happen next.
- Stay calm. Use your head. Ask questions. Do some research. We live in a world where answers are far more available to us than ever before.
- It's a dog eat dog world out there and we are all wearing dog biscuit underwear.....
- Experience is a great teacher AND.....
- You can teach an old dog new tricks.
Labels:
dog stories,
dogs,
Franta,
training
Location:
Prague, Czech Republic
Tuesday, December 15, 2015
A Marshall Plan is Needed to Stop ISIS
The crusade of tough talk from world leaders continues, backed up by air strikes and military advisors. The best we can hope for from this fundamentally misguided and weak policy mix is illusory containment.
What's needed is serious commitment from the international community to restoring security and generating economic development in Syria, Iraq and Afghanistan. Air strikes may be a good first step, but they offer no real hope for the future and can do more harm than good unless accompanied by real action on the ground.
Air strikes destroy infrastructure and disrupt the local economy. People living in areas affected by air strikes suffer from shortages in food, electricity and running water. Send in enough bombs and people eventually leave. They become refugees.
Groups like ISIS thrive in the vacuum created by air strikes. They prey on the fears and insecurities of the local population. They profit from scarcity of basic goods leads to rationing and price gouging. They are winners at the expense of the local population.
The longer peace and security in Syria, Afghanistan and Iraq remain elusive, the greater will be the cost to the rest of the world. Groups such as ISIS are a cancer and a plague. A parasite dies when its host dies. On the other hand, ISIS feeds on the ruins of everything it destroys.
Internationalists argue that basic respect for sovereign borders and the rights of nations dictates that ground troops are not deployed. But we are not talking about thriving stable states when we speak of Syria, Iraq, Afghanistan and other countries in the middle-east. We are talking about either failed states amid civil war or states existing with at best a tenuous peace.
The first step is to send in a large scalemultinational military presence wherever ISIS and groups like ISIS proliferate. The multinational force will recapture the lost ground and then guarantee security.
The second order of business is to win over the hearts and minds of the population by investing the building and rebuilding of physical and economic infrastructure, just as was done after World War II. This Marshall style plan is critical because it will rebuild the torn fabric of society and create a large base of the population with vested interest in developing and maintaining the new order.
We must not forget how much work indeed there is to be done. These are countries where many of the population are without electricity, running water, sewage treatment systems and reliable infrastructure.
Without real capital injection and development of broad based economic and political opportunity too many people are disenfranchised and without vested interest in the society.
Nobody can expect that capital and people will flow back into the region without the full support of the international community in assuring peace and stability and without economic programs that create jobs, training and education.
Nothing of any good in this world comes without hard work and
meaningful commitment. Air strikes tough talk and a fragile peace are
simply not a winning formula. Until the world's leaders recognise this,
take practical decisions and tackle the problem head on, little will
change.
Friday, December 11, 2015
Google AdWords - A Marketing Must????
Maybe yes, maybe no. But don't underestimate it!
If any of you need an animated marketing video, get in touch with my friend, Radim Hladis. He owns a company called Playou. They create animated videos that are just spectacular!
Radim,
like many of my friends, decided a few years ago that he wanted to do
his own thing....be his own boss....master of his own ship....captain of
his destiny.
Radim enjoyed the IT business but wanted to do something more creative.
Eventually Radim sold the IT business to his colleagues and headed for more colorful pastures. He started a marketing company called "Big Family" to work with small and medium sized companies designing web-based marketing and advertising campaigns.
Radim found that animated videos were a particularly effective sales and marketing tool and Big Family started providing them to clients. He become particularly adept at designing and producing the videos. He also discovered, somewhat to his surprise, demand for animated marketing videos is increasing. He rebranded Big Family into Playou.
Radim can talk at length about what makes a good animated video and why his videos are particularly good. You can get some insight into his philosophy if you see his blog about video productions produced by studios he has come to admire.
We'll get into the why's and wherefores about the appeal of animated marketing videos some other time. Suffice to say for now that with a combination of client referrals and targeted marketing campaigns Radim has begun to develop a healthy growing business.
Keep Reading! We're just getting warmed up.
That's where I come in to the picture. Radim paid a surprise visit to our offices at SymCredit recently. Radim faces the typical problem that many entrepreneurs with growing businesses face. Demand for his services is growing and he's had to hire more staff. This places pressure on working capital, so Radim wanted to learn more about how a P2P loan can help his business.Of course, I told Radim the truth, that he had knocked on the right door and SymCredit would happily serve him should he decide a P2P loan was right for him. Watch the SymCredit site and maybe you'll soon see his loan listed :).
Since Radim is a web-marketing expert I decided to pick his brain a little and asked him about good ways to market. Radim told me - "Google Ad Words is a must and being on page 1 of the search is even a bigger must!"
How can that be? I wondered. To my naive thinking, pay-per-click advertising campaigns surely result in
many wasted dollars. Customers who really are serious about finding a supplier will search past page 1. They'll also read online magazines and they'll gather references.
Second in a village like the Czech Republic everyone seems to know everyone and there are not so many video producers to choose from. The better producers benefit from word of mouth - the best form of advertising I think I know of.
Third, isn't it better to develop a referral network? That's what doctors do. My friend David Wertheim is a pediatric allergist. He knows lots of general practitioners. When one of them needs an allergist David's phone rings. David has developed a reputation over the last 20 years of practice. His phone rings often. David doesn't need to pay Google. Radim knows a lot of marketing specialists who could send video business his way, so why should Radim need to pay Google?
Finally, the conspiracy theorist in the back of my mind tells me that a savvy competitor (or worse....Google) can help you waste your money by finding ways to inundate you with wasted clicks.
My business is financial services. Specifically, I run an Angel Investment Fund, a P2P Lending Fund, a P2P Platform and a corporate finance advisory business. Investing in my products is not like running down to the store to buy a bottle of milk. When someone wants to invest in P2P Lending Fund will they really just search Google to find me? Will paying to have more people find me on Google really drive more business my way? Or will I wind up paying for clicks and watching my bounce rate on Google analytics soar? Aren't my clients far more likely to find me because they read my blogs or because they saw me speak at a conference or because they saw me mentioned in a news article or because they found me in a product focused database? Won't I propagate into Google naturally if my site and products are mentioned on lots of other websites?
Why should I spray and pray and pay for clicks I don't need when the clicks I need will find me anyhow?
Radim tells me that as many as 50% of his clients find him after they did on-line searches for video animation companies. He tells me that his phone rings more often when he runs an on-line campaign, especially using AdWords.
The most surprising thing I heard when Radim paid me his visit was that he actually starts to get enquiry from the US market. Imagine that! He's sitting in some small Moravian town and he gets enquiry from the US. So Radim is starting to seriously consider investing in an AdWords campaign aimed at the US market.
Rounding the Final Bend and Heading Home
Is Google a Marketing Must? I think the answer is....it depends on the the product and service you sell and how your customers are likely to find you and the decision process they are likely to go through before buying your service. Probably the need for Google AdWords and similar services is inversely related to market size and product complexity.
Investing is a highly personal business. Few people invest serious money with someone they don't know. The bigger the investment, the more serious thought they put in before making a decision. Advertising needs to be highly targeted and coupled with publishing, word of mouth recommendation and personal engagement. Paying for clicks and directed search engine visibility is probably not so important as simply being in the right place to meet the right people at the right time.
Video production is less personal. There is a virtual crowd of video production companies in the global space. Radim is a smart, talented fellow, but he still has to compete to get noticed. Unlike the investment space there aren't publications and databases dedicated to ranking video producers and discussing their most recent quarterly results. Radim probably needs to use powerful tools like Google AdWords, banner ads and other ways to generate clicks.
My conversation with Radim forced to do some serious thinking. I'm not running out to start a Google AdWords campaign. But there is a lot more to be said about how to e-market alternative investments smartly. Stay tuned!
To find out more about Radim Hladis. Click here or e-mail radim@playou.com.
To learn more about my P2P Lending Fund or my Angel Fund, visit symvest.com or e-mail msonenshine@symfoniecapital.com.
Thursday, November 19, 2015
ISIS and the European Refugee Crisis - What's to be Done
Those of you who know me know that I don't write about politics and foreign affairs very much. I usually stick to what I know best - P2P lending, credit, high yield bonds and angel investing. So take what I say here with a grain of salt.
Watch out! I'm going to use broad brush strokes in this piece. I might make some generalisations and I might over-simplify many issues. Not everything I propose will be practical, nor politically correct. So please don't take offense. In this case we have to pay attention to the big picture.
I saw Thomas Friedman on CNN a few days ago. He spoke on the topic of ISIS and he spoke in pretty broad terms. Speaking about the briggade of men from all corners of the world who join ISIS he said,
"None of them had ever held job, power, or a girl's hand. And when you put large numbers of young males together and you offer them a wife, yoTu offer them a salary, and you offer them the ability to lorded over somebody else, that is ISIS' value proposition."
Wow! Talk about generalisations! I'll neither agree nor disagree with this statement. I have neither the statistical nor the empiracl evidence about that. Thomas probably speaks to more people about the testosterone levels, dating history and employment background of this new generation of radicalised fighters than I do.
But, Thomas Friedman can speak in such broad terms, then I can also allw myself some leeway to depart from my training as an economist and historian. So I'll generalise and I'll make Mike's 18 point wishlist for a better world..
1. We must tackle the security threat. ISIS, Al Qaeda and Taliban and any other organised group of radical Islamists are a threat to global stability and security. All of these groups are fundamentally dangerous. So long as they can operate on any scale, our collective global security is at risk.
2. We must commit real resources. Air strikes, bombardments and focus on local opposition armies such as Iraqi Kurds are a strategies bound to fail. The only result will be more turbulence, more chaos, more refugees, more misery, more insecurity.
3. We must see the urgency. Terrorist attrocities around the world will become more and more common place so long as these groups are able to function on any scale. If left unchecked, sooner or later one of them will succeed in obtaining, if they haven't already, weapons of mass destruction.
4. The international community must band together for sake of the greater good. World leaders need to present a grand coalition of armed forces to root ISIS out of Syria and Iraq. The force must be overwhelmingly large. There are an estimated 30,000 ISIS fighers, spread out over a wide swath of territory in two countries. I'm not a military expert, but my own estimate is the international coalition is likely to have to number roughly 200,000 or more, similar to the size of the force needed to remove Sadaam Hussein from Iraq and to remove Taliban and Al Qaeda in Afghanistan.
5. The flow of money to and from ISIS and other terrorist organisations will be stopped. If ISIS are earning $40 mn or more a month then they also must be spending that money somewhere. Security agencies around the world must co-ordinate with each other, find those who buy from ISIS and those who sell to ISIS and put those people out of business.
6. A serious war again ISIS won't last long. Faced with a force of overwhelming, shocking size, ISIS will melt back into the civilian population. ISIS's fundamental flaw is that it can never keep the hearts and minds of the populations it rules at the barrel of a gun. The most radical among them will of course fight to the death. But the rest will fall away much like Nazis at the end of World War II. They will realise the error of their ways or they will throw off the yoke of tyranny misguided. ISIS will fade away like Prospero's spirits.
7. The real hard work will come in the aftermath and will continue for a generation or more. Mark my words - it will take twenty or more years to rebuild the ruins left from the past two decades of war and strife in Afghanistan, Iraq, Syria and other war torn impoverished countries.
8. Tomas Friedman and the world's policy makers will see beyond the wall of angry young men. Yes, among the latest generation of Al Qaeda, Taliban and ISIS fighter are angry young men. But the real root of the problem goes far beyond girlfriends and paychecks.
9. The international community will see the real problem is not religion but economics. When President Bush led the US into Afghanistan and then into Iraq the television images I saw were startling. Twenty years later the story, sadly, hasn't changed much. These are countries where many of the population live in abysmal conditions. Much of the population has limited access to basics like running water and electricity. Education is at best a luxury. Unemployement is persistenently high. A small portion of the population controls the overwhelming majority of the wealth while the rest are disenfrancised. I call this the problem of houses, dogs, grass, parks and trees.
10. We won't need rocket scientists and nuclear physicists to fix this problem. It's pretty simplistic, but to me self-evident. Disenfranchise enough people, force them to live in poverty and without education and they will turn to whatever demigogue that comes along with a fist full of dollars and promises of revenge. That's plain and simple.
11. The path to a stable Middle East looks terribly complex, but is really simple. The world and a new generation of political leaders must win back the hearts and minds of the people and set about the task of nation building, and in a way that gives every man, woman and child in the country a good reason to buy into the social contract. Look at Northern Ireland. It was a war zone until the Good Friday peace accords. Twenty years later Nothern Ireland is a completely different place. Few if any will trade what they have today for the war zone, misery and tears of the past.
12. Revenge and revolution is not the only way forward. Must Assad must go? Must there be strong, new leadership in Iraq? What about the fragile democracy in Afghanistan? The answer is I don't know. It depends on how enlightened, how humble, how visionary they become or if they are blinded by their own egos and prejudces. Countries like Pakstan and Ukraine suffer because nothing ever really changes. Government and the national resources get passed back and forth between a few groups of competiting interests who put each other in jail and unwind each other's deals. That cycle cannot be allowed to unfold in the Middle East. Instead a new generation of leaders must be bred in these countries and learn to put the interests of the population ahead of their own interests. They have to learn to share the wealth and to help the population create their own wealth. And they must receive international aid and support. Every man, woman and child, must see their basic rights and needs met and they must be able to see that somewhere in the distance there is hope. A strong middle and working class must emerge that has entrenched vested interest in the workings of the country.
13. Europe must get to grips with the refugess crisis. So long as the crisis of fear and destruction and criminalism of ISIS and other terrorist activities continues the tide of refugees will swell. But we shouldn't kid ourselves into thinking that when things settle down all these people will pick up their marbles and go back home, because they won't. The sooner Europe recognises that, the better.
14. A key issue must be well understood. There's a fundamental difference between refugees landing on Europe's shores in the 21st century and the tide of immigrants landing on America's shores in the late 19th and early 20th century. The immigrants to America, like my gradfather and my great grandfather, were strong, pratical hardy people who came to America seeking to build a new life and a better life. They came prepared, ready willing and able to sign onto the societal contract that if you work hard you can create opportunity or opportunity will find you. These immigrants sweated and toiled day and night to send their children to good schools and to get their children an education. They were willing to sacrifice for sake of a better future.
15. Europe and the refugees must accept each other. The tide of refugees coming into Europe are (generally speaking) wholly different. They are running away from brutality, violence and destruction. They come not necessarily with the hope that they can build a better life, but rather with the prayer that at least life will be peaceful. Two things must therefore happen. First, Europe must offer these people real hope. While the hard work of building and rebuilding the likes of Iraq and Syria and Yemen and Afghanistan continues, Europe must set the conditions in place for the refugees who choose to stay (assuming they are presented with a choice) to integrate into the fabric of European society, get their children an education, get jobs, contribute to the economy and realize their humanity. Like wise, these refugees must be presented with the basic proposition that if they buy into the society, and I repeat, buy into the the society, they will be accepted and eventually have the same opportunities as anyone else.
16. Crisis breeds opportunity. Many of Europe's leaders are thinking about the refugees as a problem rather than a challenge and an opportunity. The poor wretched mass of immigrants that washed onto American's shores went on to build schools, universities, hospitals, centers of culture and sport. Their children and grandchildren became today's political leaders. Look at the value these people and there decendants created! Europe needs to look at the refugees in a different light.
17. Europe and the refugees learn to live with each other. If the refugees think life in Europe will be easier they will be disillusioned, angry and frustrated. Life will not be easier for them. Sooner or later the benefits will run out, the handouts will stop and Europe will have a new class of poor disenfranchised people living in slums. So Europe must put opportunity on offer and be serious about it. Likewise, the refugees that stay must be convinced that hard work will pay off if not for them, but for their children and their grandchildren.
18. I won't write about foreign affairs, regligion and politics. I'll sleep well at night knowing that the world is a better place and my clients who invest their hard earned money into my Angel Fund and my Lending Fund can look forward to a future of security and prosperity.
So there you have it. The world will be dealing with the aftermath of disintegration, terrorism and failed states for years to come. Step 1 is to root out the terrorist organisations convincing force. Step 2 is to restore order and to rewrite the societal contract. Step 3 is to build, rebuild, and create hope. Nothing in this life comes easy without hard work.
If you had fun reading this, see my blog on Angel Investing and look for my blogs to come on P2P Investing. Visit Symfonie on the web at www.symcredit.com www.symvest.com www.symfoniecapital.com.
Watch out! I'm going to use broad brush strokes in this piece. I might make some generalisations and I might over-simplify many issues. Not everything I propose will be practical, nor politically correct. So please don't take offense. In this case we have to pay attention to the big picture.
I saw Thomas Friedman on CNN a few days ago. He spoke on the topic of ISIS and he spoke in pretty broad terms. Speaking about the briggade of men from all corners of the world who join ISIS he said,
"None of them had ever held job, power, or a girl's hand. And when you put large numbers of young males together and you offer them a wife, yoTu offer them a salary, and you offer them the ability to lorded over somebody else, that is ISIS' value proposition."
Wow! Talk about generalisations! I'll neither agree nor disagree with this statement. I have neither the statistical nor the empiracl evidence about that. Thomas probably speaks to more people about the testosterone levels, dating history and employment background of this new generation of radicalised fighters than I do.
But, Thomas Friedman can speak in such broad terms, then I can also allw myself some leeway to depart from my training as an economist and historian. So I'll generalise and I'll make Mike's 18 point wishlist for a better world..
1. We must tackle the security threat. ISIS, Al Qaeda and Taliban and any other organised group of radical Islamists are a threat to global stability and security. All of these groups are fundamentally dangerous. So long as they can operate on any scale, our collective global security is at risk.
2. We must commit real resources. Air strikes, bombardments and focus on local opposition armies such as Iraqi Kurds are a strategies bound to fail. The only result will be more turbulence, more chaos, more refugees, more misery, more insecurity.
3. We must see the urgency. Terrorist attrocities around the world will become more and more common place so long as these groups are able to function on any scale. If left unchecked, sooner or later one of them will succeed in obtaining, if they haven't already, weapons of mass destruction.
4. The international community must band together for sake of the greater good. World leaders need to present a grand coalition of armed forces to root ISIS out of Syria and Iraq. The force must be overwhelmingly large. There are an estimated 30,000 ISIS fighers, spread out over a wide swath of territory in two countries. I'm not a military expert, but my own estimate is the international coalition is likely to have to number roughly 200,000 or more, similar to the size of the force needed to remove Sadaam Hussein from Iraq and to remove Taliban and Al Qaeda in Afghanistan.
5. The flow of money to and from ISIS and other terrorist organisations will be stopped. If ISIS are earning $40 mn or more a month then they also must be spending that money somewhere. Security agencies around the world must co-ordinate with each other, find those who buy from ISIS and those who sell to ISIS and put those people out of business.
6. A serious war again ISIS won't last long. Faced with a force of overwhelming, shocking size, ISIS will melt back into the civilian population. ISIS's fundamental flaw is that it can never keep the hearts and minds of the populations it rules at the barrel of a gun. The most radical among them will of course fight to the death. But the rest will fall away much like Nazis at the end of World War II. They will realise the error of their ways or they will throw off the yoke of tyranny misguided. ISIS will fade away like Prospero's spirits.
7. The real hard work will come in the aftermath and will continue for a generation or more. Mark my words - it will take twenty or more years to rebuild the ruins left from the past two decades of war and strife in Afghanistan, Iraq, Syria and other war torn impoverished countries.
8. Tomas Friedman and the world's policy makers will see beyond the wall of angry young men. Yes, among the latest generation of Al Qaeda, Taliban and ISIS fighter are angry young men. But the real root of the problem goes far beyond girlfriends and paychecks.
9. The international community will see the real problem is not religion but economics. When President Bush led the US into Afghanistan and then into Iraq the television images I saw were startling. Twenty years later the story, sadly, hasn't changed much. These are countries where many of the population live in abysmal conditions. Much of the population has limited access to basics like running water and electricity. Education is at best a luxury. Unemployement is persistenently high. A small portion of the population controls the overwhelming majority of the wealth while the rest are disenfrancised. I call this the problem of houses, dogs, grass, parks and trees.
10. We won't need rocket scientists and nuclear physicists to fix this problem. It's pretty simplistic, but to me self-evident. Disenfranchise enough people, force them to live in poverty and without education and they will turn to whatever demigogue that comes along with a fist full of dollars and promises of revenge. That's plain and simple.
11. The path to a stable Middle East looks terribly complex, but is really simple. The world and a new generation of political leaders must win back the hearts and minds of the people and set about the task of nation building, and in a way that gives every man, woman and child in the country a good reason to buy into the social contract. Look at Northern Ireland. It was a war zone until the Good Friday peace accords. Twenty years later Nothern Ireland is a completely different place. Few if any will trade what they have today for the war zone, misery and tears of the past.
12. Revenge and revolution is not the only way forward. Must Assad must go? Must there be strong, new leadership in Iraq? What about the fragile democracy in Afghanistan? The answer is I don't know. It depends on how enlightened, how humble, how visionary they become or if they are blinded by their own egos and prejudces. Countries like Pakstan and Ukraine suffer because nothing ever really changes. Government and the national resources get passed back and forth between a few groups of competiting interests who put each other in jail and unwind each other's deals. That cycle cannot be allowed to unfold in the Middle East. Instead a new generation of leaders must be bred in these countries and learn to put the interests of the population ahead of their own interests. They have to learn to share the wealth and to help the population create their own wealth. And they must receive international aid and support. Every man, woman and child, must see their basic rights and needs met and they must be able to see that somewhere in the distance there is hope. A strong middle and working class must emerge that has entrenched vested interest in the workings of the country.
13. Europe must get to grips with the refugess crisis. So long as the crisis of fear and destruction and criminalism of ISIS and other terrorist activities continues the tide of refugees will swell. But we shouldn't kid ourselves into thinking that when things settle down all these people will pick up their marbles and go back home, because they won't. The sooner Europe recognises that, the better.
14. A key issue must be well understood. There's a fundamental difference between refugees landing on Europe's shores in the 21st century and the tide of immigrants landing on America's shores in the late 19th and early 20th century. The immigrants to America, like my gradfather and my great grandfather, were strong, pratical hardy people who came to America seeking to build a new life and a better life. They came prepared, ready willing and able to sign onto the societal contract that if you work hard you can create opportunity or opportunity will find you. These immigrants sweated and toiled day and night to send their children to good schools and to get their children an education. They were willing to sacrifice for sake of a better future.
15. Europe and the refugees must accept each other. The tide of refugees coming into Europe are (generally speaking) wholly different. They are running away from brutality, violence and destruction. They come not necessarily with the hope that they can build a better life, but rather with the prayer that at least life will be peaceful. Two things must therefore happen. First, Europe must offer these people real hope. While the hard work of building and rebuilding the likes of Iraq and Syria and Yemen and Afghanistan continues, Europe must set the conditions in place for the refugees who choose to stay (assuming they are presented with a choice) to integrate into the fabric of European society, get their children an education, get jobs, contribute to the economy and realize their humanity. Like wise, these refugees must be presented with the basic proposition that if they buy into the society, and I repeat, buy into the the society, they will be accepted and eventually have the same opportunities as anyone else.
16. Crisis breeds opportunity. Many of Europe's leaders are thinking about the refugees as a problem rather than a challenge and an opportunity. The poor wretched mass of immigrants that washed onto American's shores went on to build schools, universities, hospitals, centers of culture and sport. Their children and grandchildren became today's political leaders. Look at the value these people and there decendants created! Europe needs to look at the refugees in a different light.
17. Europe and the refugees learn to live with each other. If the refugees think life in Europe will be easier they will be disillusioned, angry and frustrated. Life will not be easier for them. Sooner or later the benefits will run out, the handouts will stop and Europe will have a new class of poor disenfranchised people living in slums. So Europe must put opportunity on offer and be serious about it. Likewise, the refugees that stay must be convinced that hard work will pay off if not for them, but for their children and their grandchildren.
18. I won't write about foreign affairs, regligion and politics. I'll sleep well at night knowing that the world is a better place and my clients who invest their hard earned money into my Angel Fund and my Lending Fund can look forward to a future of security and prosperity.
So there you have it. The world will be dealing with the aftermath of disintegration, terrorism and failed states for years to come. Step 1 is to root out the terrorist organisations convincing force. Step 2 is to restore order and to rewrite the societal contract. Step 3 is to build, rebuild, and create hope. Nothing in this life comes easy without hard work.
If you had fun reading this, see my blog on Angel Investing and look for my blogs to come on P2P Investing. Visit Symfonie on the web at www.symcredit.com www.symvest.com www.symfoniecapital.com.
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