Monday, November 26, 2018

Google Cloud’s New Chief Faces Growth Challenge

Apparently Nerds are not enough!  Aivars Lode

Good day, CIOs. Google Cloud struggles to keep up with market leaders Amazon Web Services and Microsoft Corp. in the market for corporate cloud computing. Google, owned by Alphabet Inc., has great technology, but prowess in artificial intelligence isn’t enough. Now Google Cloud CEO Diane Greene, a Silicon Valley luminary who co-founded VMware, is stepping down and relinquishing her role to former Oracle Corp. president of product development, Thomas Kurian.
The smartest-kids syndrome. “Google has great technology, but it’s mostly built by the smartest people for the smartest people,” Brian Hopkins, principal analyst at Forrester Research, tells CIO Journal in an email. The problem is that being the smartest kid in class didn’t necessarily ensure popularity in high school. The business world is a lot more like high school than graduate school. Charisma and likeability count for a lot.
The best vs. the best selling. “Google’s whole value proposition is that they are selling as cloud services the same technologies they use themselves,” Mr. Hopkins writes. “The problem is that most prospective customers have a hard time identifying with Google, so the ‘If it’s good enough for Google, customers should love it …’ argument is falling on deaf ears.”
By Steve Rosenbush - WSJ

Thursday, November 15, 2018

Dow Falls 600 Points as Tech Rout Hits Stocks

No real surprise.  Aivars Lode

The Dow Jones Industrial Average tumbled more than 600 points Monday as anxiety over the health of technology behemoths sparked a broad retreat from the stock market. 
Monday’s selling began in the technology sector, then morphed into a rout that dragged lower everything from oil conglomerates to manufacturers to entertainment firms. It was the latest setback for the stock market, which has struggled to break out to new highs since the S&P 500 capped off its worst month in more than seven years.

Friday, October 26, 2018

Tech Worries Pressure Stocks

Is this the beginning? Have we reached the high of the markets? Aivars Lode

A slump in technology and internet stocks accelerated Friday, putting the S&P 500 in danger of joining the Nasdaq Composite in correction territory, as investors continued an October retreat from risky assets.

Tuesday, October 23, 2018

Managers see increased credit defaults in next 12 months, survey finds

More news on issues with Bonds, Credit Defaults and Retirement Funds not being able to fund. When do we reach the tipping point?   Aivars Lode

Credit portfolio managers forecast rising credit defaults in the next 12 months and are split as to whether credit spreads will widen or remain the same over the next three months, said a third-quarter survey from the International Association of Credit Portfolio Managers.
In the survey, 58% of credit portfolio managers forecast that average corporate credit default rates will go up during the next 12 months, while 34% said they will remain unchanged and 8% said defaults will go down.
When asked whether North American credit spreads will widen or tighten over the next three months, only 8% of respondents said they expected spreads to tighten, but the result was split otherwise, with 47% believing spreads will not change and 44% believe spreads with widen.

Monday, October 22, 2018

Debt Likely To Be ‘Ground Zero’ In Next Financial Crisis, Says Oaktree's Marks

Over-leveraged deals and PE returns that will not be there .... both likely to be Ground Zero as previously discussed. Aivars Lode

Now is the time to adopt a cautious investment strategy as the market cycle ages, though there aren’t signs of an impending U.S. recession, according to Oaktree Capital Group LLC’s Howard Marks.
The world’s largest economy is still doing “very well,” Marks, chairman and co-founder of one of the world’s largest alternative and distressed investment firms, told Bloomberg TV in Sydney on Monday. Despite a lack of bargains in many markets, strategies should focus on remaining invested and position defensively, without piling into cash, he said.

“Our economy is still doing very well,” said Marks. “In a few months it will become the longest recovery in history. I don’t believe there are signs of recession anytime soon."
Marks has warned his investors previously that debt is likely to be “ground zero” in the next financial crisis, with too much money on the hunt for too few deals. The leveraged loan market, which has overtaken high-yield bonds as the go-to-financing source for speculative grade companies, is a particular source of concern for both Marks and central bankers.
The billionaire investor said it’s impossible to predict how long the economic expansion and the bull run in U.S. stocks will last, though he believes the market is in the tail end of a cycle.
“Nothing is cheap in our markets and most things are between the high side of fair or the beginning of rich,” he said. However, there are no risks comparable in scale to those on the eve of the financial crisis, he said.
Right now, holding a defensive positioning, while not bailing out of investments completely, is the best approach, he suggested. “We are endeavoring to be fully invested, but we are doing it with caution,” Marks said. “We are not going to cash.”
Marks co-founded Los Angeles-based Oaktree in 1995. The firm had $122 billion in assets under management as of June 30.
This article was provided by Bloomberg News.

Sunday, July 29, 2018

Energy for the Future?

There is little public conversation about real energy solutions that will truly provide clean energy. Instead in the public discourse we are driving capital into inefficient power generation capabilities.....Aivars Lode

Harnessing the energy of the sun and stars to meet the Earth’s energy needs has been a scientific and engineering challenge for decades. A self-sustaining fusion burn has been achieved for brief periods under experimental conditions, but the amount of energy that went into creating it was greater than the amount of energy it generated.
What’s needed next, for fusion energy to supply a continuous stream of electricity, is energy gain. The National Ignition Facility intends to be the first fusion facility to demonstrate ignition and gain. NIF’s fusion targets are potentially capable of releasing 10 to 100 times more energy than the amount of laser energy required to initiate the fusion reaction.
The nuclear power plants in use around the world today use fission, or the splitting of heavy atoms such as uranium, to release energy for electricity. A fusion power plant, on the other hand, will generate energy by fusing atoms of deuterium and tritium, two isotopes of hydrogen—the lightest element. Deuterium is extracted from abundant seawater, and tritium is produced by the transmutation of lithium, a common element in the Earth’s crust and oceans.
When the hydrogen nuclei fuse under the intense temperatures and pressures in the NIF target capsule, a helium nucleus is formed and a small amount of mass lost in the reaction is converted to a large amount of energy according to Einstein’s famous formula E=mc2.
A fusion power plant would produce no greenhouse gas or other noxious emissions, operate continuously to meet demand, and would not require geological disposal of radioactive waste. A fusion power plant would also present no danger of a meltdown.

Because nuclear fusion offers the potential for virtually unlimited safe and environmentally benign energy, the U.S. Department of Energy (DOE) has made fusion a key element in the nation’s long-term energy plans, with investments into magnetic fusion energy and with the ability to leverage the investments from the National Nuclear Security Administration’s defense programs that support NIF.
By the Lawrence Livermore National Laboratory