Wednesday, September 24, 2008

Wall Street Executive Compensation Manifesto & Challenge: I will risk working for free, will you?

This financial and investing blog entry is directed at Mr. Paulson, The Treasury, The Federal Reserve, Congress, The White House, and Wall Street in general.

My Challenge to Wall Street and Executive Management

I hereby challenge Wall Street executives to meet or exceed my personal commitment to fixing the financial system problems in this country, and doing so with the same promise I make to REQUIRE ZERO PAY unless I, through managing such a firm, achieve success not just in the short-term, but the long-term as well, for shareholders and/or the American taxpayers. IF you believe in your abilities as much as I believe in mine, especially when you perhaps have more "experience or qualifications" to perform the job of Senior Executive of a public company than do I, you should have no problem signing onto my plan. If not, step aside and allow me, and perhaps a few associates of mine that will offer equal commitment to the task, to take over the situation and fix the problems.

I have outlined my corporate-compensation manifesto below, to which I will subscribe, and I suggest the government force other CEOs and highly compensated managers of public companies to subscribe to, especially in light of the latest "private profits, public losses" shift that leaves us ordinary citizens to bailout the result extremely bad management decisions of recent, and especially where any CEO's will be managing what is essentially a government-backed / taxpayer-backed venture going forward.

After reading this New York Times article describing the Wall Street Bailout Terms, which absolutely infuriated me, and forced me to make as clear as possible how adamant I feel about how MR. PAULSON IS ABSOLUTELY WRONG WITH CONCERNS ABOUT LIMITS ON EXECUTIVE COMPENSATION. I hereby call you and your other cronies out on the floor for a debate about WHY such high-compensation is "needed", when I am quite willing to work without pay unless I perform! Here's the quoted text that got me fired up:
"Under a so-called claw-back provision, the secretary would have the power to force companies to recoup previous payments to executives of companies involved in the program. And Mr. Frank's plan would give broad authority for the Government Accountability Office, an investigative arm of Congress, to audit and oversee the program.
But Mr. Paulson said that he was concerned that imposing limits on the compensation of executives could discourage companies from participating in the program.

"If we design it so it's punitive and so institutions aren't going to participate, this won't work the way we need it to work," Mr. Paulson said on "Fox News Sunday." "Let's talk about executive salaries. There have been excesses there. I agree with the American people. Pay should be for performance, not for failure.
But he quickly added: "But we need this system to work, and so we — the reforms need to come afterward.""

OK, Hank,... let us focus on your statement about "Pay should be for performance" instead of the sentence (expressing concerns about compensation limits) that simply furthers the Wall Street mantra many years in the making which justifies exceedingly exorbitant salaries, options, and bonuses for executives even while companies are losing money, going under, laying off thousands, and so on. And, that part of Hank's statement about reforms needing to come afterward: BULL #@$! Reforms must happen NOW, or no (lasting) benefit will arise from these bailouts!

If that part about pay-for-performance is real in your own belief system, it is NOW time to start making executive compensation what is SHOULD be: a true risk/reward system, where for being that high-level executive and leader, you are taking the "risk" of not meeting or exceeding company profit goals, which would make your pay essentially disappear, while at the same time you have the potentially LARGE reward that comes with creating corporate and shareholder profits that lead to your own salary and bonuses being large. This is the age-old risk/reward concept.

Notice how this differs from what led us to this mess on Wall Street to begin with; i.e., the current "reward/reward" system, whereby executives get massive compensation packages even when a company makes nothing and shareholders lose millions or billions, and/or employees take the brunt of the impact of "cuts" while executives reward themselves for these actions. It is so utterly obvious that current executive management at most publicly traded firms (most: there are some exceptions) have absolutely no belief in their abilities, in their company's ability to ever generate profits, or in the prospects of their stock price ever increasing. If they did, they would not have to receive massive compensation packages for simply "doing their job" whether doing it resulted in company growth, shareholder value growth, and so on.

Right now, many corporate executives are essentially just like ANY other employee that shows up for work and gets paid whether they are an *exceptional* employee, and average one, or a complete screw-up!... but, there is one big difference: currently, these upper-level executives are getting stellar pay packages for their "efforts" whether such efforts are fruitful or fruitless or downright calamitous. This has to end.

My proposal for executive compensation change will fix Wall Street and restore investor confidence in a MEANINGFUL LONG-TERM WAY, not like this current bandage-approach of yet another bailout package. Bailouts like those being done now, and proposed now, are perhaps the WORST way to achieve any LONG-TERM investor-confidence, as there will be no fundamental change with one of the main negative influences on stock prices, investment returns, and investor confidence (i.e., corporate management whose primary concern appears to be how much, and how quickly, they can suck from the company for personal gain regardless of shareholder returns). In fact, it is quite simply a reinforcement of wrongdoing and broken practices when failures are "bailed out" without serious changes to the rules of the game.

My Executive-Compensation Manifesto
(and Challenge); circa, bailout-mentality-decade, early 21st Century.

This compensation manifesto is certainly not perfect, nor the end-all of compensation directives, but it should serve as a decent bit of foundation work to get the discussion headed in the right direction, and with additional time and effort (and input from others), I am sure it could be tuned into a doctrine that could be applied to public companies in order to reign in outlandish compensation, and more so return investor confidence and long-term shareholder value.

1. As I stated in a prior financial blog about the Government rewarding financially irresponsible companies and individuals:
"If you have risen to the level of CEO [or other Senior Executive] of some major corporation and can not afford to not make ANY money for a year or two, you do not have the financial responsibility to run such a company - period!" This should be rather clear, but if not, let me restate this: if the executive(s) have not managed their own personal finances well over the years, and built up their own "retained earnings" (i.e., some substantial savings) over the years, then they do now show financial responsibility adequate to justify their position.
Sadly, the current pool of "executive talent" that is running these public companies will perhaps meet my 1st condition simply due to the fact they have already ripped off the investors and given themselves massive financial cushions during this recent age of reward-reward executive compensation (note: I think those that fit this bill should be banned from further consideration, pending a rather detailed review into how they acquired their compensation – some of these people may be just fine for consideration, though many will prove out to be the rip-off artists that took massive pay packages for essentially, failure). I'd love to further apply this same concept to elected officials, as our government is currently made up of masses of individuals that show little financial aptitude, beyond getting elected with hopes to increase their personal fortunes after making all sorts of connections that will pay off later (most likely via the revolving door between Washington, Wall Street, and Lobbyist firms). These same people then sit down together and dream up bailout packages and debt-spending frenzies like none other, perhaps in part because they have no clue what real financial responsibility entails.
2. See item #1 for reference continually as I further expand on my executive compensation manifesto. The only exception to the zero-pay potential is that I suggest meeting any Federal or State or Local "minimum wage" base requirements, and to offer any legally-imposed benefits or benefits applied to *every* employee regardless of their pay-grade (e.g., Health Insurance plans, Sick Leave, etc.). And, to handle work-hours laws and/or overtime regulations, even though I consider Senior executives "exempt", for purposes of this manifesto adhering to any possible legal requirements, I suggest that the Senior executives, while earning the minimum-wage figure, be compensated for all hours works, and at 1.5X minimum-wage for overtime and perhaps 2X for weekend time.

3. Note how my doctrine still supports successful "startup" firms, like Google for example, that created enough wealth for their upper management through product and service innovation that resulted in strong demand for their initial public offering that their executive leadership team certainly would have met the criteria set forth in #1. These persons may have received compensation prior to going public, and I consider such compensation irrelevant for my doctrines, as shareholders in the IPO must choose what value to place on the new firm upon entering the stock-market (and, that value includes prior compensation and stock holdings by insiders). But, like any public company, after these startups have entered the realm of publicly-traded stocks (via IPOs), these people will be subject to all the terms of the manifesto from then on.

4. Any compensation packages for senior executives should be awarded in arrears. The basic reasoning is simple: as we have learned, "good" quarterly or annual financial reports can be completely and utterly misleading when viewed in the context of the long-term implications of what made particular periods "good". Examples abound, whether the "good" numbers were due to intentional hiding of the bad (like in off-balance-sheet vehicles, or just plain and simple cooking of the books), or due to overly-optimistic and aggressive tax-stances or accounting policies that will require "earnings restatements" and the like (e.g., FedEx trying to classify employees as contractors to save money - which I hear recently backfired), or due to any other reason that "good" values would be front-loaded with a pending disaster to follow (e.g., the current sub-prime mortgage debacle and resulting imminent bailout!).

The arrears-period should be long enough to make obvious any attempt to circumvent the discovery of reality by shareholders. Meaning, if actions of senior executives were truly "good" then those actions should appear good at 5 to 10 years out, when looking back upon them. This leads me to a key concept in my compensation manifesto and challenge: the current insanely-large rewards of Wall Street (to senior executives) should only remain possible IF the executives take the risk that their strategies and management decisions lead to long-term rewards for the average shareholder as well.

Here's the basic idea, which can be tuned as needed (but, not tuned to avoid the spirit of the time-proven rewards structure)
  • All earnings to be held in arrears, whether salary, bonuses, or stock-options (hereinafter referred to as "potential compensation" or "compensation" for short), will be held in a financially "safe" storage mechanism, such that executives need not worry about their potential compensation disappearing if it is indeed "earned" over time.
  • The compensation potential must be sufficiently large to induce qualified executives to take on this "risk" in order to have the chance for substantial "rewards", but, if all (publicly held) companies employ the directives contained in this manifesto (whether voluntarily, or by law), the definition of "substantial" will likely vary considerably from the insanely high and ever-increasing compensation packages management has been rewarding themselves with for the past decade or more. This leads to setting a maximum compensation potential based on a variety of data-points and criteria, which will be outlined next (others will certainly arise)…

  • Data-point 1) the company-average-employee wages. It seems only sensible that there be some correlation to the pay of the "average person" within an organization in order to encourage paying a fair living wage to all employees. Likewise, if outsourcing is employed for cost-savings initiatives within a company, any labor that is essentially replaced with outsourced-labor or other contractors will still be counted towards this average-wage by determining the end-worker's average wage.
  • Data-point 2) stock dilution. In as much as common stock (or preferred for that matter) is diluted during the tenure of executive management, their potential compensation should be diluted by an equal percentage. Contrarily, if outstanding shares of stock are reduced (i.e., concentration vs. dilution), then compensation can by multiplied by the same percentage. This should help reign in the massive dilution that seems to occur constantly in public companies as executives essentially "print stock at will" to self-reward, whether they should be rewarded or not. So as not to think this metric would encourage management to jeopardize cash-positions for the sake of stock buybacks, keep reading…
  • Data-point 3) Cash and equivalents vs. Short and Long-Term Debt. Some multiplier force will be involved to reflect solid financial practices. Now, since management must make decisions that are best for the LONG TERM corporate and shareholder returns, this consideration should in itself not dissuade management from considering financing (or, per data-point 2, equity issues) if it is truly the right thing to do for growth.
  • Data-point 4) Earnings. Another "multiplier" factor when calculating compensation (and, other factors to follow). Plain and simple, the bottom line. And, this is not any "before extraordinary items" and the like; this is the real deal and is truly net income.
  • Data-point 5) Dividends paid to shareholders. Higher payout to shareholders equals higher compensation potential. Again, this must be balanced with the preceding metrics to ensure dividends are not being paid out at the expense of corporate health (something that seems all to common these days!), but…
  • Data-point 6) Stock price. Again, decision balance is important, as stock price is directly correlated to compensation potential.
  • Data-point 7) Environmental impact. This one is not in my short-term "requirements", though it needs to be addressed soon. Fact is, a company should not reward executives that increase short-term profits at the expense of simply shifting environmental disasters to foreign countries or the like.
  • Data-point 8) ratio of total "senior executives" to normal workers. Positive correlation to compensation package. There needs to be a reason to keep some "depth" of talent in the upper ranks. But, this too needs weighed with total cost-structure for the company. The idea here is to "spread the talent, spread the responsibility, and spread the wealth" so as to potentially encourage more of a management-by-consensus or better group-dynamic at the top vs. the often highly corrosive infighting among top-management seeking power-grabs and such.
  • Data-point 9) time-delay for receiving compensation. Highly correlated multiplier to total compensation potential, offering much greater rewards for demonstrating faith in the long-term outcome of decisions. This one is quite important.
  • Data-point XYZ) I believe there are others, though for now, this is enough detail to begin a discussion certainly.
  • "Releasing" of compensation will be "tiered", with "earned" compensation being released from its holding in arrears-state in smallest portions for most recent completed time-period, and largest-releases for oldest covered time-periods. I.e., time-proven "earnings" are truly earned and delivered to the executive, and in greatest percentage for the longest-term proven results. Finally, if executive actions lead to failed long-term returns for the shareholders, or are proven to have resulted from illegal action or actions that were taken simply to manipulate compensation formulas (as I first discussed), some or all compensation for the time-period(s) in question is released back to the COMPANY immediately and into general operational assets (or, in the case of stock-options, returned to the treasury).

5. "Golden Parachutes": GONE! This practice of rewarding failure with mega-bonuses when someone is "let go" must end! This is an integral part of the RISK/reward concept. The fact is, the average employee, who doesn't enjoy the prospect of potentially earning 10's or 100's or 1000's of times their base-pay, faces the simple exit-package they deserve if they do not perform: they are fired or "downsized" or laid off or whatever. The average employee gets to collect unemployment, and/or perhaps they get a few weeks severance per year of service. Well, same should go for Senior Executives! Period!
And, to the argument that perhaps a company would engineer the early departure of an otherwise successful executive just to not pay them the rewards they have earned: I think not. Fact is, this plan of mine encourages GROUP SUCCESS, as everyone's fate is tied together, from the lowest employee to the top of the company - it is all about performance. See next point...

6. I am not ignorant of the fact that, to have one's compensation so tied to the performance of not just one's own efforts, but potentially the efforts of subsequent management, is a tough concept to accept. But, again, if you have reached the level of executive management of a public company, you best have the insight to recognize real opportunity, a solid Board of Directors, and have faith in succession planning (in fact, my plan should encourage SOLID succession planning that, again, is focused on the long-term benefit to the company and shareholders, and not just instantaneous riches through "Golden Parachutes" and the like). The goal of this overall manifesto is to encourage hiring the right people for the job, especially executive management positions, with more regard for qualifications than connections. The fact is, the entire executive layer in corporations should have an interest in the same outcome: solid corporate returns and stockholder value and growth.


I guarantee that, if (the essence of these concepts are) implemented, the policies I have enumerated herein will have lasting positive effects on investor confidence in publicly traded companies and financial institutions. This will NOT be the case with a bailout plan that does nothing to fundamentally alter the way that executive pay is tied to performance. In fact, any bailout without something as sweeping as what I have described will likely just (very temporarily) postpone complete collapse that will follow, as executives will take the bailout as nothing more than reinforcement for their actions that led us here to begin with.

Some Related Observations and Discussion

I am sick of hearing that there are not "qualified people" to run these firms. Obviously the ones that have run the firms into the ground were not the best qualified, though we certainly heard much testimony to the contrary during the hiring and tenure of these individuals. It is time to expand the scope of who is capable of leading such firms to go beyond the traditional system of connected-individuals, and Boardroom-kickback-friendly stooges that so often end up running the show.

Fact is, a major change needs to occur on Wall Street before it all ends, or before we simply repeat this bubble-mentality that will yet again POP, and pop in ever larger ways, taking everything with it and starting the insane cycle of bailout-based-recoveries all over again, where the overpaid executives that cause it all will once again be the ones most highly rewarded, even as they cause the mess!

Wednesday, September 17, 2008

Chevy Volt : GM will NEVER LEARN!

I hardly know where to start any discussion about GM and all the issues they suffer from, but perhaps first and foremost is they they NEVER LEARN when it comes to showing really hot looking "concept cars" and "prototypes" that, upon production run, turn into generic, boring, basic, (and occasionally hideous) typical GM junk.

Case in point: years ago (1994) I went to the Greater Cleveland Auto Show and saw this utterly fantastic looking version of what was supposed to be the Pontiac Sunfire. The concept looked more like what the production version of the 1995-1999 Mitsubishi Eclipse Spyder looked like than anything (best I can describe), but when it hit the streets, it was god-awful generic GM junk. And my wife and I were seriously ready to purchase one of those beautiful Sunfire roadsters (as seen at the auto-show) until it was released, and we instead chose the Mitsubishi that actually looked nice when released!! GM: WAKE UP! Quit showing concepts that are nothing like what you will release... I will never buy a generic looking replacement for what you are showing off at an auto-show in a completely different form.

New example: the new Chevrolet Volt.
Again, count me out - the production Volt looks nothing like the concept that was shown for the past few years!


wow, that looks rather hot! I'll take one please!

Oh, but wait...
In typical GM fashion, that "Chevy Volt concept" has nothing to do with reality...
Instead... get ready...


What the hell is that!?! OK, if I wanted a Ford Fusion (or some other rather basic looking four door), I'd buy one,... but I don't want THAT! I want the HOT LOOKING PROTOTYPE THAT WAS DESTROYED BY General Motors (as always!).

The prototype reminded me of the Chrysler Crossfire or such. It had some sportiness, some flair, some styling that was semi-unique, and was bold and innovative. But, as always, the GM bait-and-switch comes around again, and my interest is fading... oops, I mean GONE!

To top it off, these losers at GM are saying they can only get 30-40 miles per charge off the batteries. And, GM (and the "American auto industry") are seeking Federal loan money to the tune of $25-50 billion dollars to "improve mileage" of their cars by something like 25% (which, is like 5 MPG or so on average for their fleet - give me a break... for BILLIONS to do what you should be doing already, you should DOUBLE MILEAGE!!).

At the same time, Tesla Motors produces an (admittedly expensive and high-end) totally hot looking electric roadster (looks like a Lotus Elise) that gets 200-250 miles per charge, and they are not getting billions from the government (they did get about 20 million in tax-incentives to keep 1000 or so jobs in California at their startup manufacturing plant). Tesla is also going to produce a more mainstream vehicle with this longer range - like a family coupe or such - for around $60K.

Before anyone tells me that the Tesla is "too expensive" and not a fair comparison, think about the indirect cost of the GM/American-auto-bailout (i.e., "loan") to work on producing what another small American Silicon Valley startup is already doing without government funds. I figure that Tesla, once they ramp production, will get their cars down to a more affordable range as battery technology comes down in price too. And, Tesla doesn't enjoy anywhere near the production volume that the likes of GM do, so I find it amazing Tesla can even offer their cars for what they do.

Well, bottom line is simple: GM screws up again and loses my interest by teasing me with a hot looking prototype that is ruined on production-release. I'll give them credit with the Pontiac Solstice though - that one looks rather nice. Now, give me a Solstice that gets 40MPG with gasoline, or 150 miles on battery, and I will think about buying one!

Saturday, September 06, 2008

Intel Solid State Disk Drives - Awesome!

For years I have been awaiting the release of SSDs (Solid State Disks, aka Solid State Drives, aka RAM disks) that were affordable, offered great performance, require nearly zero power consumption to operate, and come from a "mainstream" technology company in a standard interface (SATA).

Well, you can't get more mainstream than Intel, and Intel has just recently announced / released their first SATA Flash Memory SSD products (production to start this month - September 2008):
You just have to see the specifications to believe them (see below), as these drives are just unreal! Check out that super-low power consumption, and those blazing fast speeds! Oh my god I am looking forward to building the most insanely fast disk-array ever!

And, I have already purchased, and I am purchasing more, Intel stock (NASDAQ:INTC) based on the potential I see for this product. If you have been following the news about the issues large data-centers in the USA are experiencing, with regards to power-density (and not being able to get enough physical electrical power to run all the servers in a room) and the related cooling issues (again, buildings housing server rooms are being tapped-out with regards to the air-conditioning and climate-control systems, and the power to run those systems), you will see why I am so excited.

Ignoring all other performance factors of these new flash-memory standard SATA-interface hard-drives, I still see massive potential for companies to swap-out their existing spinning-disks (i.e., traditional hard-drives) in there data-centers and replace them with these new Intel Solid State Drives. It's a "no brainer" in my opinion. And, I am just talking data-centers here, and for simple power-density and heat (or lack thereof) considerations.

I have yet to even describe the incredible performance gains that some applications, like databases and the like, are going to realize from these drives. Physical IO (Input-Ouput) has always been the Achiles heel of any high-end server, as disks (in general) can not even come close to keeping up with the speed of today's modern processors (like the latest Intel and/or AMD 64-bit and multi-core offerings). But, with these new Solid-State-SATA-Drives, things are about to change... the power of the CPU(s) is about to be unleashed! I am picturing incredible new database applications, analytics, and more.

And, if that wasn't enough, couple all this new super-speed-storage from Intel with technologies like NVIDIA's CUDA - which gives programmers the ability to exploit the incredible parallel processing power of the modern NVIDIA (NASDAQ:NVDA - another stock I am betting on for the coming years) GPUs through their CUDA development framework (essentially, Nvidia's extensions to C language). With CUDA, Nvidia has a product offering that is not just interesting, but substantially amazing, in its potential for massive financial analysis applications, data-analysis programs, and the like - by offloading compute-intensive (especially mathematical and matrix type) operations to the GPU. Nvidia only requires you own one of their GPUs from this list of CUDA-enabled Nvidia Products (GeForce 8 series ++ basically, or one of their "Tesla" servers). Oh, and what kind of processing power am I talking about here? Well, the new NVIDIA S1070 server (1U form factor too) has 4 Teraflops of performance (yes, 4 TRILLION OPERATIONS PER SECOND!). Holy $%*! So, I need only learn how to couple these new Intel SSDs and CPUs with this NVIDIA technology, and Skynet will be born! (a Terminator movie reference folks. lol.)

If that was not enough, I also guarantee that gamers (by the millions) are going to want these drives. Gaming afficionados have no problem dumping thousands on their "ultimate gaming computers" just to get a 10% speed-advantage over someone else. They will spend a thousand bucks on two new Nvidia GeForce SLI graphics cards for maximum frame-rates, and extra money on the fastest DDR RAM, and up until now, extra money for traditional RAID implementations (i.e., multiple hard drives with multiple spindles moving simultanesouly to serve up not just redundancy-enhanced data-storage, but speed given the right confiuration). Well, there is nothing even close to the speed of these new Intel SSDs when it comes to random reads, sequential reads, and nearly anything else. And, latency? Nearly non-existent!

From the Intel web-site...:

Technical specifications (Extreme SSD)

Model name Intel® X25-E Extreme SATA Solid-State Drive
Capacity 32GB and 64GB
NAND Flash components Intel® Single-Level Cell (SLC) NAND Flash Memory
10 Parallel Channel Architecture with 50nm SLC ONFI 1.0 NAND
Bandwidth Sustained sequential read: up to 250 MB/s
Sustained sequential write: up to 170 MB/s
Read Latency 75 microseconds
I/O Per Second (IOPS) Random 4KB Reads: >35,000 IOPS
Random 4KB Writes: >3,300 IOPS
Interface SATA 1.5 Gb/s and 3.0 Gb/s
Form factor 2.5" industry standard hard drive form factor
Compatibility SATA Revision 2.6 Compliant. Compatible with SATA 3 Gb/s with Native Command Queuing and SATA 1.5 Gb/s interface rates
Life expectancy 2 Million Hours Mean Time Before Failure (MTBF)
Power consumption Active: 2.4W Typical (server workload¹)
Idle (DIPM): 0.06 W Typical
Operating shock 1,000G / 0.5ms
Voltage 5V SATA supply rail
Operating temperature 0°C to +70°C
RoHS compliant Meets the requirements of EU RoHS Compliance Directives
Product health monitoring Self-Monitoring, Analysis and Reporting Technology (S.M.A.R.T.) commands, plus additional SSD monitoring

Technical specifications (Mainstream SSD)

Model Name Intel® X18-M Mainstream SATA Solid-State Drive
Intel® X25-M Mainstream SATA Solid-State Drive
Capacity 80GB and 160GB
NAND Flash Components Intel® Multi-Level Cell (MLC) NAND Flash Memory
10 Channel Parallel Architecture with 50nm MLC ONFI 1.0 NAND
Bandwidth Up to 250MB/s Read Speeds
Up to 70MB/s Write Speeds
Read Latency 85 microseconds
Interface SATA 1.5 Gb/s and 3.0 Gb/s
Form factor X18-M: 1.8" Industry Standard Hard Drive Form Factor
X25-M: 2.5" Industry Standard Hard Drive Form Factor
Compatibility SATA Revision 2.6 Compliant. Compatible with SATA 3.0 Gb/s with Native Command Queuing and SATA 1.5 Gb/s interface rates
Life expectancy 1.2 million hours Mean Time Before Failure (MTBF)
Power consumption Active: 150mW Typical (PC workload¹)
Idle (DIPM): 0.06W Typical
Operating shock 1,000G / 0.5ms
Operating temperature 0°C to +70°C
RoHS Compliance Meets the requirements of EU RoHS Compliance Directives
Product health monitoring Self-Monitoring, Analysis and Reporting Technology (S.M.A.R.T.) commands plus additional SSD monitoring

I have looked at other proprietary SSD / RAMDISK solutions over the years, and they were always insanely expensive to say the least, and the performance just wasn't worth the investment. In the past, most drives were tiny by comparison (4GB, 8GB, and maybe 16GB) for insane prices (yes, thousands; even for tiny capacities).

But now, with these new mainstream Intel SSD drives, things are about to change in a big, industry-transformational, way (and, in a "green" way too - from massive power savings and reduced cooling requirements). You wait, and you will see. The end of the hard-drive as we know it is coming, and SSDs are going to become the "standard", and I have a feeling Intel is going to lead the way with Solid State Drives using their dominant technology brand and value-proposition.

I will be anxiously awaiting the shipment-date so I can get my hands on a few of these drives. The possibilities are just too wonderful to not try these drives out in my production systems! And, even for the higher price (which, I expect will fall considerably as early as next year when production ramps up), I should see instant returns on investment by replacing my disk-drives that I launch VMware Virtual Machines from, drives that I have SQL-Server database on, and so on. My electric bill is certainly going to show some downward movement!

If you want more detailed information, I found a nice article at TG Daily - Intel SSD Discussion.

Intel announced a $595 pricetag for the mainstream 80GB SSD, which comes in 1.8-inch (X18-M) or 2.5-inch (X25-M) sizes for the same price; the 160GB version is coming later this year (Q4), and pricing has not yet been announced.

For this price, I will definitely grab a couple and put them to use in my primary desktop and notebook to see how they perform. If they meet expectations, I'll soon thereafter upgrade my servers.

I saw that PC Connection has a web-page listing the SKU for the 80GB mainstream model (Intel X25M) for $731.35 (though, the Manufacturer Part Number (SKU) being shown is SSDSA2MH080G1C5, which is supposedly a 5-pack, is obviously incorrect). I expect other vendors to have pricing online soon, and to hit Intel's target pricetag (or perhaps undercut a bit for the large volume dealers, since Intel's pricing was for 1000 or less drives - which suggests a volume disount above 1000 drives). Heck, some data-centers easily have over 1000 drives, if not 10,000... perhaps they should buy direct from Intel :)

Friday, September 05, 2008

United States Unemployment Rate

Reuters just reported the August 2008 Unemployment Rate, and I couldn't help thinking that ECONOMISTS ARE IDIOTS as a whole! If you want more background on why I think so, see my prior blog posting on the Inflation rate, and how "I told you so".

Per Reuters today:
The US unemployment rate unexpectedly shot up to 6.1 percent in August, its highest in more than 4-1/2 years, as employers cut payrolls for an eighth straight month and labor markets showed signs of accelerating decline.
WHY is this "unexpected"?? morons! The only ones that seem to keep saying how great our economy is are the elected officials running the show currently (and perhaps the Republican follow-up show that is running for office right now too). Everyone else in America (aside from the very upper end of the income scale) can see first hand that inflation is rampant, housing prices are slumping, credit is tight, and people living rather near the "edge" of their means, which is all forcing spending to slow to include primarily the "essentials" (though, my view of essentials differs from most other peoples', as I exclude things like cell-phones, cable TV, and the like - those are choices people).

I see this first hand. My wife and I sell our Gluten-Free Recipes Book directly via the web, and I have seen a direct (inverse) correlation between gas prices and my book sales. It has only gotten worse as gas passed through $4.00 mark. The recent easing of gasoline prices helped stimulate sales a bit, but they are still lagging the pre-$3.00/gallon days considerably.

The fact is, people are TAPPED OUT! And when people stop spending and/or are forced to spend just on the basics (well, at least the American version of basics), that means that various product and service providers are losing their ability to sell things (like my book), which can lead to staff being reduced and unemployment increasing. Heck, just the massive housing decline alone should be enough for most idiot economists to see that there are going to be long-term and far-reaching implications for unemployment as the trickle-effect of products/services sales revolving around real-estate slow down.

I can't help thinking that perhaps the timing is perfect for all this. America needs to wake up to the fact that there is a fundamental problem with this economy. We are shipping insane amounts of our assets to energy-producing countries and foreign suppliers of cheap consumer goods. Where do you think that money ultimately goes? Sure, it may come back here in part, but not as reciprocal purchases of United States sourced goods and services for the most part -- instead it comes back by way of financing of our debt and as purchasing of our business assets and the like. We're selling everything that isn't nailed down in order to finance this insane need to fuel our vehicles at any cost, even as it is forcing us out of work by pushing all our much-needed capital out of American business and individuals' hands and into the pockets of foreigners that we will owe forever.

Wake up America! This is JUST THE BEGINNING, unless we make some substantial changes. Oh, and by the way, in addition to any personal debt you may have, do you want to know what your government, under this spend-crazy leadership, has obligated you and your family to?

The following is a quote right from the Treasury's own 2007 report:
Federal debt managed by the bureau totaled about $9 trillion at the end of fiscal year 2007. However, that number excludes many items, including the gap between scheduled and funded Social Security and Medicare benefits, veterans' health care, and a range of other commitments and contingencies that the federal government has pledged to support. If these items are factored in, the total burden in present value dollars is estimated to be about $53 trillion.3 Stated differently, the estimated current total burden for every American is nearly $175,000; and every day that burden becomes larger. Given the size of the projected imbalance, the U.S. government will not be able to grow its way out of this problem; tough choices will be required.
Notice, this is JUST the FEDERAL OBLIGATIONS... add on State, County, Local, etc. How much more obvious can it be - we CAN NOT and WILL NOT EVER be able to get out from under this national debt. There is absolutely no way that every man, woman, and child in this country can fork over $175K each - OBVIOUSLY. The relative "strength" of the USA, especially over the past couple decades, is nothing short of a mirage. It is smoke and mirrors folks. It was a series of "bubbles" (tech bubble, then real estate, and TONS of government spending throughout).

Our coffers are drained, and the signs are showing more and more. This doesn't mean immediate doom though, as our government has shown an incredible ability to keep the house-of-cards standing via ever-more debt... including the latest "stimulus checks" (which I posit were to BLAME for much of the inflation spike and gas-price spike - see that link for my predictions and outcome.) And, of course, more government officials are calling for further stimulus packages (which of course mean, just put it on the giant credit-card of the US government to hide the fact we are seriously hosed!).

I am perhaps a bit alarmist, but the fact is, something has to change. Unemployment increases should not be seen as a "surprise" or "unexpected" event in the least bit given the fact that our financial underpinnings are built on a foundation of quicksand. Get ready for more such "news" going forward, as the ripple-effect spreads. Don't confuse ripple with trickle (like the supposed "trickle down economics" that are supposed to save us through tax-cuts, and extended tax-cuts, to the upper income levels -- though, there is some relation between two, as this tax policy has helped lead us to this current state).