Probably the fact that Spain is the country with more downloads per internet user in Europe made Spain the first EU country to get Netflix. When I recently met with Presidential hopeful Alfredo Rubalcaba he spoke about how much pressure the Spanish government received to stop the downloading of US content without pay in Spain and was very aware of how Spotify was making it in Spain as a legal alternative.

Now the challenge will be to see if it was true that people downloaded because DVDs are a rip off or because they don’t want to pay any price for movies. Because Spotify really took off in Spain but only the ad based version. Few pay. And there is no ad version of Netflix. Only on Hulu there is. But to me Netflix is an incredible deal. To pay less than €10 per month for all you can eat quality streamed movies is unbelievable.

I pay for Spotify and for Netflix. Netflix I had to sign up through our home in NYC and use it with VPN service Witopia that makes me show up as a US client.

I love Spotify on my mobile!

Hell is coming to The Hamptons http://passageweather.com/ I am sailing in the Med these days and use Passage Weather as a sailing web site. Go into this site and track the hurricane, it’s scary! We have a farm in the Hamptons, Luna Farm in Sagaponack. It is a historical farm. I hope it survives. And I hope some miracle makes the hurricane go away from the coast in the next 48 hours.

I am debating with too many people on Twitter. I give up. Most people seem to believe that EU and USA went to war in the Arab countries, Iraq, Afghanistan, Pakistan and now Libya because somehow we are making money doing so. They don’t get it that Europe and USA lost trillions in these wars. That their people, their economies… lost trillions and a horrible sacrifice of human lives on all sides. That yes there are some minor beneficiaries of this disasters like some people in the military industry and military contracting but that for the economies of USA, UK and some EU countries have been wasting $3 trillion only in Iraq as you can see here. And this is madness. Most on my twitter stream believe that somehow we will get paid back. How? Stealing their oil? Well that will never happen and should not happen. Did Saddam or Gaddafi not want to sell oil? Because now we get somebody else to sell us oil at $107 per barrel is that enough reason to invade Iraq? If all we wanted was to buy oil we would not go to war. We went to war because of some idiotic reasoning in the case of Iraq and some smarter reasoning in the case of Libya (where we invested much much less, worked with Libyans and got what seems to be like a good outcome). We went to war because we believed that toppling people who kill their people and sometimes foreigners with oil money don’t deserve to be in power. But the Iraqi money and human lives spent in the Iraq War are gone for good. We should have done nothing in Iraq, Saddam had nothing to do with Al Qaeda and he would have fallen like Gaddafi did, at a much smaller cost if we had waited a decade.

Libyans look like they are in horrible shape, and as they finish their civil war they are. And we are all happy Gaddafi, while still at large, is not in power. But unlike anything you can imagine, Libyan finances are not that bad. Libya is no Egypt. They have over $200bn in assets of which $165bn are abroad. They are only 6 million people and have no national debt. As a result each Libyan has assets of $30K. Americans instead have around $50K of debt per capita and Europeans $30K. But Americans and Europeans, paid dearly for the liberation of Libyans, not as much of course as the failed wars of Iraq and Afghanistan but still significant. Should us in EU and USA stop fighting other people’s wars and focus on rebuilding our economies? I think so. We should emulate George W Bush who had everyone contribute to the cost of the Gulf War and as a result it was short and relatively inexpensive as described in the first link. My view is that from now on, if we deal with wealthy nations like Libya I think we should only intervene only to tilt the balance and only if we get repaid. And in cases in which true humanitarian reasons are at stake we should do this together with many nations and sharing the costs.

USA is an amazing country. But it would be way more awesome if:

-it did not spend half of what the whole world together spends in the military.

-it did not have lawyers who leech on business with a “tort tax” adding unnecessary costs to the economy in medicine, patents and tons of other fields.

-it did not spend twice as much as Europe in health care per person leaving many in precarious conditions and ending up with the average American living 3 years less than the average European.

-it regulated guns.

-it educated more and incarcerated less.

-it reduced the environmental footprint and calorie intake per person.

-Americans learn to live within their means (not from the savings of foreigners).

Yesterday I spent three and a half hours brainstorming on how to turn Spain around with presidential candidate Alfredo Rubalcaba. He understands that the answer to unemployment is entrepreneurship. I appreciated that he listened carefully to my ideas for increasing employment. Spain has the highest unemployment rates of all OECD nations (20%) and this problem was the focus of our meeting.

Spanish citizens have 3 choices this November. To go with Rajoy, to go with Rubalcaba, or to vote for lesser parties and hope one day they become meaningful actors in Spanish politics. What I decided to do is to promote one simple and I believe powerful idea to grow employment to both Rajoy and Rubalcaba. I started with Rubalcaba today, the candidates with less chances to win. The plan is that during 2012 the Spanish government does not demand that companies pay social charges for all employees hired beyond the level of employment they had in 2011. It is an incentive to grow employment, to promote new and increased hiring only for 2012. It’s a jump start for the economy. The idea is explained in Spanish below. I believe this measure will make the difference that may make entrepreneurs start businesses and grow existing businesses. Rubalcaba reacted well to it and said his economists would study it.

Here is the plan http://spanish.martinvarsavsky.net/general/plan-para-aumentar-empleo-que-presentare-manana-a-rubalcaba.html

I know most Spaniards believe there is no hope that Rubalcaba will get us out of the crisis. Most Spaniards however also believe that there is little hope that his rival Rajoy will get us out of the crisis. But personally I believe that there’s nothing that is so wrong with Spain that cannot be fixed by what is right in Spain. I am more optimistic than most.

On Rubalcaba himself I can say, after having met Felipe Gonzalez, Aznar, Zapatero, Rajoy and him, that he is different from the other politicians. He is the only one trained as a scientist and educator. He is more of an administrator and thinker. He is a Chemistry professor and it shows. Would I wish Spain had other choices for President? Of course I would. I recently met with embattled David Cameron and in spite of his dubious choice of friends and poor handling of the riots he is a more impressive global leader. I never met Angela Merkel but I got a sense from what I see about her that Rubalcaba is more like her in terms of personality. But a government is not just a president, it’s a president and a team. And even though I find Rajoy an unimpressive candidate I could still end up favoring if he announces a better team than Rubalcaba before the election.

Now Rubalcaba speaks English and that is more than can be said about anyone else who’s run this country. In the end a President has to be the number one promoter of the country. Both Rajoy and Rubalcaba are Spanish characters not particularly appealing to foreign leaders or investors. None of them are like Jordi Pujol for example who was amazing at promoting Catalunya around the world. But between the two, Rubalcaba is slightly better as he can communicate without an interpreter and is more aware of what makes a country succeed in a globalized world. Rubalcaba seems a pragmatist, a person willing to try and fail hoping to get policies right in the end. I identify with that. People expect politicians to get things right but if in business being successful involves being right only slightly more frequently than being wrong I don’t see why decision making should be different in politics. In general when I confronted Rubalcaba with obvious mistakes of the Socialist Party, like the Ley Sinde, he did not try to defend the indefensible. Indeed he agreed to my proposal of bringing some of the tech entrepreneurs who were heavily involved in the 15M movement that brought millions out to the street protesting against the incompetence of all politicians himself included. In that sense he is very different from dogmatic Aznar who still thinks that invading Iraq was a great plan.

What really and concretely happened to this country is that it went from building 800K new homes a year to building 100K and around 12% of the labor force ended up unemployed. That explains 80% of what is wrong here. The rest of the industries were hurt in this crisis but not as badly as the construction industry. Spain can be turned around if we focus on growing the rest of the economy. So far what happened here is that the growth of Spain was fake, based on increasing debt and not sustainable sectors of the economy. My plan promotes employment in whatever sector may end up hiring without having government try to guess exactly how to grow the economy.

I am happy that Rubalcaba said he would have an economist specialized in tax revenues study my plan. Common sense tells me that my plan is a net revenue generator for the government from day one. Why?

Because it only applies to new employees and only on businesses that increase their work force compared to 2011.

Because there is a pool of 5 million unemployed and net job increases must come to a great percentage from this pool.

Because government stops paying the unemployed the moment they join a business and this produces immediate savings.

Because even if the government does not immediately get social charges they will get social charges over time and anyone making financial projections on tax revenue collections will have this into account. As a result rating agencies will see positive trends on tax collections and ratings will improve, this will lower the cost of borrowing for Spain. Shirking the debt premium produces enormous savings.

Because as soon as somebody is employed this person starts consuming and pay VAT and all sort of consumption taxes, gasoline etc that help tax revenues.

Because my plan provides an opportunity for the millions in Spain who work illegally to negotiate a transition to legality that will cost nothing to the employer during the first year and some will emerge from the underground economy in a way similar to a tax amnesty. It is an attack on the underground economy based on incentives that could be more successful than the failed Socialist Party plan based on increased fines that was put in place.

Now one way in which this plan would cost the government money is if ONLY those employers who were going to hire anyway hire, nobody else is attracted by the incentive and then the government loses 2 and a half years of social charges and some severance packages. But from an informal survey to my entrepreneur friends and the question, would you start a business or grow a business further if during 2012 you don’t have to pay social charges and if the business fails you don’t have to pay severance packages the answer from everyone was a resounding yes.

Note: if you feel that this article lacks content you are right 🙂 While with Rubalcaba I agreed not to disclose a lot of the ideas that were part of the brainstorming.

Shit shit shit if you are German, fuck fuck fuck if you are American, vagina vagina vagina if you are Spanish (coño).

It is interesting how many cultures curse and obsess with different part of the body or bodily functions/actions.

This article in Vanity Fair tries to explain how German banks squandered a significant amount of the savings of the German people lending it to crooks in a Freudian way without ever citing Freud. It’s all about shit it argues.

I found the article bad but still worth sharing. If anything it says more about the American writer.

Yes, it is true that the German language is full of expressions related to shit and they give examples. And it is also true that Germans love cleanliness and are very organized. But this does not explain why they work so much better than most other Europeans and waste their savings lending to all sorts of weird schemes. Why they believe the Greeks when they tell them they will balance the budget or why they lent to so many subprime schemes in USA. Maybe a lot of that has to do with the fact that the people who run their banks are incompetent and not so much with shit shit.

To me US bankers are insanely greedy and German bankers are just incompetent at assessing foreign risk and they should just stay mostly at home. But Germany, as well as Japan historically and now China, has the problem of nations who work hard, save a lot and then can’t find uses for these savings locally and tend to end up either making bad investments abroad or lending to debt-addicted cultures until they go bust.

The challenge that HTC, Samsung, Nokia and others will now have is that they will compete against two Silicon Valley giants, Apple and Google, who can design great hardware and sell it at low margins. Apple will recoup its costs with apps and content and Google with ads and apps. Instead, all other hardware makers will have to think of how to monetize after the hardware is sold or they will have a hard time competing. A proof of this is that nobody has come up with a product that competes with the iPad at $499 yet. No hardware makers can turn their hardware into a post-sales cash machine as Apple can. Now Motorola will be able to make Android/Honeycomb tablets at low margins because Google will milk them with post-sale profits from ads, apps and probably soon content as paid versions of Youtube and music services get going.

Is there a Moore law of memory? Because if there isn’t there should be one. It should read like this: every 18 months you can buy twice the memory for the same price. And this Moore law of memory is finally working in my favor. As opposed to Moore law itself which seems to be a wash because whenever you get faster chips you get bigger programs, with storage memory I am now unable to produce content at the speed hard drives are falling in price. All my photography and videos taken throughout my life amount to around 3TB. Now that I take RAW photography and HD videos I consume around 100GB per month of memory. But I saw that now they make 6GB external HD for around $400. I am about to get one of those, I can put everything I ever photographed or filmed and still have enough room for a couple of years. It feels nice to be ahead.

In any case advice on what HD to get is appreciated.

A few weeks ago I wrote that Google had to buy a smartphone maker.

I am very glad they bought Motorola. Google has very little to lose buying Moto and a lot to gain. Motorola is affordable, has good IP, is in USA, and even though they clearly don’t make the best Android phones now Andy Rubin will make sure they do.

And $9.5bn is what Google could afford (Moto has $3bn in cash). HTC is a much better company but $50bn is tough even for a $150bn Google. Samsung impossible.

Now the challenge is to make sure that the level playing field continues that Samsung, HTC, Sony Ericsson and others don’t feel discriminated and if GoogleMoto wins is because they just make the best hardware/software experience.

Of course there is a risk that Android partners will try to help promote Windows Phone but for that they are late after Nokia and in any case mobile operating systems can hardly be pushed. Microsoft has so much cash and resources and with all their might WP is selling 15K units per day while Android sells 550K. A mobile OS is like a social network of geeks where the people are the apps developers. And in a mobile OS as in many other things in life, money can’t buy you love. It helps, but it doesn’t buy it.

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