Tech Review: 1) What Will Replace Facebook? 2) Jeff Bezos in 1999 (video)

Tech Review (TR 2019-02-16)--Domain Mondo's weekly review of tech investing news: Features • 1) What Will Replace Facebook? 2) Jeff Bezos In 1999 On Amazon's Plans Before The Dotcom Crash, 3) Investing: The Week & Investor Notes: Globalization in Transition, Germany Vulnerable, Bill Gross, John Paulson, Byron Wien, 4) ICYMI Tech News: Big Tech and more, 5) End Note: Velocity.

1) What will replace Facebook? 

Facebook (NASDAQ: FB) has dominated the social-media landscape for the past 15 years. "But breaches of its users' privacy mean it is now slipping out of favour. Could an emerging technological movement take its place?"--The Economist.com video above published Feb 4, 2019. See also There Are Storm Clouds On Facebook's Horizon--seekingalpha.com.

Also note: Headlines Aren't Reality--seekingalpha.com: "At 22 times earnings, FB is my highest conviction buy of 2019."

2) Jeff Bezos In 1999 On Amazon's Plans Before The Dotcom Crash

Jeff Bezos explained his ambitious vision for Amazon $AMZN in a 1999 interview. He made clear the company’s focus was on “great customer service” and discussed his real estate strategy. Bezos said, “There’s no guarantee that Amazon.com can be a successful company. What we’re trying to do is very complicated.” He added, “Scale is important to us and we’re going to go after that kind of scale.” CNBC.com video published Feb 8, 2019.

See also:

• Bezos Complexifiers from Ms. Sanchez to Ms. Ocasio-Cortez: "we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens"--aboutamazon.com.
• Amazon Isn’t Interested in Making the World a Better Place by Kara Swisher--"New Yorkers who expected better bought into the myth that tech companies are more than just self-interested businesses."--NYTimes.com Op-ed.
• 'New York’s Ejection of Amazon Is the Start of a Movement'--citylab.com. New York Congresswoman Alexandria Ocasio-Cortez Cheers Amazon’s Withdrawal as a Victory Over ‘Greed’--bloomberg.com.
• Bezos's Wild Days: 'Dick Pics,' Lurid Selfies, Blackmail, Drama--bloomberg.com.
• Bezos Selfie Controversy Triggers Alarm For Billionaires Worldwide.
• Why Amazon $AMZN Is Undervalued--seekingalpha.com.
• Size Matters: When Amazon Went From Big to Unbelievably Big--Amazon now has 288M sq. ft. of warehouses, offices, retail stores, and data centers; all retail adds up to less than 20M sq. ft. and all of AWS uses 10M sq. ft.--the data on the company’s real-estate holdings reveal a remarkable inflection point--theatlantic.com.

3) Investing

The Week: NASDAQ Composite +2.4% | S&P 500 Index +2.5% | DJIA +3.1%

The Long View:

Investor Notes: with the world awash in $8.6 trillion of negative-yielding debt, money managers are wading again into fringe fixed-income markets across the globe--“We’ve seen a huge psychological swing toward greed from fear in the space of a few weeks,” said Jamie Stuttard, co-head of global macro fixed-income at Robeco Group in London (robeco.com).

Americans' Confidence in Their Finances Keeps Growing--gallup.com; Goldman Sachs CEO David Solomon says US economy 'chugging along,' chance of recession quite small--cnbc.com.

U.S. Oil & Brexit: the United States is now the largest global crude oil producer (production to grow to 14 mbpd by 2030 according to EIA.gov), and the U.S. has already become the United Kingdom's largest supplier of oil for the first time since the Suez crisis of 1956, reports the Financial Times.

Trump Effect or Not, Globalization is in Transition: future of trade and value chains--China exported 17% of what it produced in 2007, but only 9% of what it produced in 2017, about the same percentage as the U.S., but much lower than Germany's 34%, South Korea's 28%, and Japan's 14%--mckinsey.com.

• Editor's note: export-heavy countries may be at risk, particularly Germany. The EU has badly miscalculated the economic risks of Brexit for the EU, particularly Germany (the UK imports more from the EU than it exports, and Germany is most vulnerable). A 'hard Brexit,'  in conjunction with Trump's trade policies, could deliver a double whammy to Germany's already slowing economy in 2019.
• "Germany’s long expansion comes under threat, the slowing is a consequence of its export-oriented model"--economist.com.
• German Industrial Production Falls the Most Since 2009. New Orders Plummet ... a “technical recession” beckons--WolfStreet.com.

Majority Of U.S. CEOs See Trump's Tariffs Helping--"More than double the number who saw a negative impact"--zerohedge.com.and bloomberg.com.

The Bond King Retires: Bill Gross’s retirement from Janus and his  recent struggles show how hard it’s become for individual managers to beat the indexes, algorithms and sprawling trading teams that oversee today’s portfolios--bloomberg.com.

John Paulson, 63, may also be getting ready to call it a day. He said last month that he is considering booting out investors and managing only his own money within a couple of years--largely unknown until the financial crisis, when he shorted housing before everyone else recognized the bubble, his firm made $15 billion in 2007, and his personal cut was $4 billion. Read The Greatest Trade Ever.

Blackstone's Byron Wien Discusses Lessons Learned in His First 80 Years: #20 Never retire.  "If you work forever, you can live forever.  I know there is an abundance of biological evidence against this theory, but I’m going with it anyway."--blackstone.com.

4) ICYMI Tech News:

Google announces "over $13 billion in investments throughout 2019 in data centers and offices across the U.S., with major expansions in 14 states. These new investments will give us the capacity to hire tens of thousands of employees, and enable the creation of more than 10,000 new construction jobs in Nebraska, Nevada, Ohio, Texas, Oklahoma, South Carolina and Virginia. With this new investment, Google will now have a home in 24 total states, including data centers in 13 communities. 2019 marks the second year in a row we’ll be growing faster outside of the Bay Area than in it." Google also plans to release a lower-priced smartphone this year--nikkei.com; and  Google extends chip-making efforts to a design hub in Bengaluru, India--reuters.com.

Alphabet (GOOGL, GOOGL) aggressively ramped up capital spending in 2018, spending far more than the large telecoms AT&T (T) and Verizon Communications (VZ), and other tech giants Microsoft (MSFT) and Amazon (AMZN).--seekingalpha.com. See also 'Why Alphabet is a better investment than Apple'.--seekingalpha.com, and Apple Faces New Challenges In App Store--seekingalpha.com.

Big Tech: Microsoft, Google, Facebook, Apple, and Amazon, have become so large that even relatively modest percentage growth in any of their businesses would translate into enormous absolute change in the world--theatlantic.com.

Going short Tesla $TSLA: Druckenmiller bought Tesla Puts in Q4 2018.

Venture Capital: VCs raised $55B in 2018, but most of the increased funding went into growth rounds, which are effectively private IPOs--bothsidesofthetable.com.

Speed robotics development with the cloud--therobotreport.com.

Cut the Cord: MGM’s Epix Joins Streaming Market With Epix Now app--Variety.com.

Boeing's iconic 747:

NASA's Boeing 747 transporting the Space Shuttle

UPS ordered 14 more 747-8 freighters in 2018, and Boeing's iconic jumbo jet, now flying in the skies for more than 50 years, looks set to outlive its younger European competitor, Airbus SE’s A380, thanks to a cargo market boom fueled by online shopping.

Sprint sues AT&T over its “5G Evolution” branding, claims it is false and deceptive advertising that is damaging the reputation of actual 5G --engadget.com.

Germany, France face hurdles in push to rewrite EU antitrust rules--Vestager says global rules on subsidies and trade defense instruments, controlling foreign investments, mutual access to markets and reinforcing data protection and privacy rules should be included.

Blockchain’s Occam problem--mckinsey.com: "given the amount of money and time spent ... little of substance has been achieved." [ Editor's note: Occam’s razor is a problem-solving principle, the simplest solution tends to be the best.]

5) End Note

How to Increase Velocity: Say "No" to the Non-Essential, ruthlessly eliminate unnecessary tasks, priorities, meetings, BS; create systems and habits that help you fend off distractions; and put all your effort into the projects that really matter.

“People think focus means saying yes to the thing you've got to focus on. But that's not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully. I'm actually as proud of the things we haven't done as the things I have done. Innovation is saying no to 1,000 things.”--Steve Jobs

-- John Poole, Editor, Domain Mondo  

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Alibaba $BABA Q4 2016 Results, Jan 24th LIVE Webcast Replay

Alibaba's Jack Ma Calls for a More Inclusive Globalization at Davos 2017:

Video above published Jan 18, 2017: Globalization of business is good, but it hasn’t been good enough so far, said Alibaba Executive Chairman Jack Ma. Ma discusses his meeting with Trump, jobs, and global trade.

Alibaba Group $BABA UP 41.15% in 1 year (source: google.com)

Alibaba Group Holding Limited NYSE:BABA [alibabagroup.com] December Quarter 2016 (Q4 2016) unaudited financial results to be reported before U.S. market opens Tuesday, Jan. 24, 2017. January 24, 2017 Conference Call and Webcast at 7:30 a.m. ET (US) / 8:30 p.m. Hong Kong Time.

• LIVE Webcast replay via http://www.alibabagroup.com/en/ir/earnings. The archived webcast will be available for one week (dial-in number: +61 2 8199 0299; conference ID: 48066090).
• Alibaba Group's Investor Relations website at http://www.alibabagroup.com/en/ir/home:
  December Quarter 2016 Results Press Release and Presentation: In the quarter ended December 31, 2016, revenue was RMB53,248 million (US$7,669 million), an increase of 54% year-over-year. Outlook for fiscal year 2017, "we expect revenue to increase 53% year-over-year."  
• FQ3 EPS $1.30 beat consensus by $0.17. Revenue of $7.7B beat by $370M.
• $BABA shares opened UP at the NYSE market open on January 24, 2017.

Alibaba Group presentation slides:

See also:

• Alibaba Group $BABA Q3 2016 Results, LIVE Webcast Nov 2 Replay | DomainMondo.com 
• Alibaba: Do You Know What You Are Buying? - Alibaba Group Holding Limited (NYSE:BABA) | SeekingAlpha.com: "What exactly do you buy when you purchase Alibaba stock? As it turns out, this question is difficult to answer. What is easier to address is what you do not own when you buy Alibaba."

Tweets about $BABA


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Roger McNamee: Apple, EU, Future of Globalization, China (videos)

Roger McNamee: Apple Appealing EU Tax Is A Lose-Lose:

Video above published Dec 19, 2016: Roger McNamee, Elevation Partners co-founder, gives his take on Apple's response to the EU's tax ruling, Ireland and the EU, and the future of globalization.

Apple Inc. 
Domain: apple.com
Stock: NASDAQ: AAPL

Americans Are Paying Apple Millions to Shelter Overseas Profits | Bloomberg.com: "Over the years, Apple Inc. has become the poster child for U.S. multinationals accused of sheltering overseas profits to avoid the IRS. What’s gone largely unnoticed is that it’s been paid more than half a billion dollars by the U.S. government to do just that. Taking advantage of an exemption tucked into America’s Byzantine tax code, Apple stashed much of its foreign earnings—tax-free—right here in the U.S., in part by purchasing government bonds, according to people with direct knowledge of the matter. In return, the Treasury Department paid Apple at least $600 million and possibly much more over the past five years in the form of interest, a Bloomberg review of its regulatory filings shows ..."

Do Stocks Have A Big China Problem?

Video above published Dec 19, 2016: Chinese bonds and equities have been sinking recently. Are American markets next? Max Wolff of 55 Capital and Eddy Elfenbein of the Crossing Wall Street blog discuss with Eric Chemi.

Shanghai Composite Index (source: google.com)

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UPDATE: ICANN enjoined from delegating .AFRICA by California State Superior Court Judge

Stanford GSB Professor David Brady: A Look at the 2016 Elections (video)

"As for Mainstream Media [MSM] bias: Bernie [Sanders] was fortunate to only be blacked out, Soviet style; Trump has zero MSM newspaper endorsements and has been subjected to MSM bias that is laughably ham-handed, reminiscent of old-style Communist "running dogs of Imperialism" propaganda ... With the rise of the Internet and social media, broadcast propaganda is now competing with narrowcast: blogs, Twitter and Facebook enable self-organizing tacit tribes ... with their own networks of communication, narratives and agendas ... In terms of finance and communications, politics as usual--political candidates and narratives mandated by the parties' Ruling Elites and the MSM--is dead. We will all look back in 2026 and wonder why the recognition of this reality took so long."--Charles Hugh Smith

David Brady: A Look at the 2016 Elections:

Whatever your political leanings or anxieties about this year's Presidential election, you will be enlightened after listening to Professor Brady's talk in the video above. He explains what, in his view, is really happening, what makes this election year different than others, not just in the U.S., but in Europe and elsewhere, with humor and insight. 

One caveat: much has already changed (or been revealed) since the video above was recorded on October 14, 2016, as part of the Stanford University Graduate School of Business (Stanford GSB) Fall Reunion/Alumni Weekend.

Topics covered include globalization and immigration. The 2016 Presidential Race has had a polarizing effect on many voters, with the 2 major candidates each having high unfavorable ratings. See, e.g., Clinton’s unfavorable rating hits new high in poll | Trump targets Democratic states in final sprint | MarketWatch.com (Oct. 31, 2016).

New polling indicates voters are shifting in view of the late-breaking Wikileaks disclosures, the FBI re-opening its investigation of Hillary Clinton (email scandal) together with revelations about the Clinton Foundation and its tie-ins ("pay-to-play") with Teneo and Hillary Clinton during her tenure as Secretary of State. Trump 47.8% now leads Clinton 42.4% in the USC Dornsife / LATimes.com tracking poll as of November 2, 2016.

The YouGov.com poll referenced in Professor Brady's talk, as of November 1, 2016, shows Trump has a clear path to victory (270 electoral votes) by winning YouGov's "toss-up" states of Florida, Georgia, North Carolina, Iowa, Ohio, Nevada, and Pennsylvania (in all of which Trump narrowly leads or is close according to YouGov). Even without Pennsylvania, Trump could still win by picking up another 10 electoral votes somewhere else, such as Wisconsin. One BIG problem with the YouGov methodology is that it estimates patterns of 2016 voter turnout using the 2012 Obama-Romney general election--which YouGov admits is "a key place where we might get things wrong if there is a large change in turnout patterns" in 2016--many experts say 2016 voter turnout patterns will differ from 2012. See also The U.S. Stock Market Isn’t Going Clinton’s Way | Bloomberg.com Nov. 1, 2016: "S&P 500 down 3.2% since Aug. 8, a good sign for challenger Trump. Market correctly signals outcome 86 percent of time since 1928." 

Just as the Brexit vote was the global macroeconomic event of the first half of 2016, the U.S. Presidential election has the potential to be the global macroeconomic event of the second half of 2016. U.S. voting will conclude the evening of Tuesday, November 8.

Speaker in the video: David Brady
Professor of Political Economy, Stanford GSB 
Davies Family Senior Fellow, Hoover Institution 
Senior Fellow, Stanford Institute for Economic Policy Research

Stanford Graduate School of Business, Stanford University
Domain: gsb.stanford.edu

See also:

• Election 2016: An odd blip or a fundamental shift in American politics? | Bloomberg Government | bgov.com: Professor Brady says. “I can’t tell you based on past experience [what the undecided voters will do] because we’ve never had candidates as unpopular as these [Hillary Clinton and Donald Trump].”
• CNN Chief Jeff Zucker Rips Donna Brazile's 'Disgusting' Dealings With Clinton Campaign | HuffingtonPost.com:  CNN Chief Jeff Zucker blasts Donna Brazile in Tuesday editorial call, describing her interactions with Clinton campaign as “unethical” and “disgusting.”
• That secret Trump-Russia email server link is likely neither secret nor a Trump-Russia link | The WashingtonPost.com: "On Monday night, Slate published a [bogus] lengthy story written by Franklin Foer ... "
• Entrepreneur and VC Peter Thiel speaks at The National Press Club (video)

Unedited auto-generated YouTube.com transcript (pdf) embedded below:

Tweets by StanfordBiz

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MacroView: World Markets, Global Economy, Central Banks, Trick or Treat?

Domain Mondo's weekly review of  macro economic and investing news:

MacroView Feature •  Just in time for Halloween: World Markets, Global Economy, Central Banks, Trick or Treat?

Halloween in the global economy:

The FT.com's Katie Martin and Anthony Doyle of M&G (domain: mandg.com) discuss current fears in the fixed income market, including negative yields, inflation growth and emerging markets debt. Published October 28, 2016

•  China Gets Desperate About Debt: "China doesn’t need a new debt-for-equity swap program. It needs to cut credit growth."--Bloomberg.com

Why China is worried about its lending:

There is growing concern in Beijing about China’s development lending in risky countries. FT.com's James Kynge explains. Published October 26, 2016. See also Xi Jinping Is China’s ‘Core’ Leader: Here’s What It Means | NYTimes.com.

•  China’s Crown Probe Seen as Warning Shot to Foreign Firms: "... some business consultants in general ... [are] advising foreign executives to steer clear of mainland China for now."--WSJ.com

•  A $1 Trillion Industry Is Finally Going Digital: "The $1 trillion global business of shipping goods and raw materials by rail, ship, or plane has lagged most of the modern economy in both transparency and speed, largely skipping the digital overhaul most other industries have undergone. Now a growing group of well-funded startups is pushing to change that."--technologyreview.com

•  Why the Jobs Aren’t Coming Back: A plant in Michigan had been around for years. It had employed 600 people on two shifts. Then, the Chinese began to undercut the pricing, and the plant was no longer profitable and closed. Two years later, it reopened as a fully automated plant and regained the business because it could now manufacture cheaper than the Chinese--"This new plant is fully automated and runs 24/7/365 with just 14 people."--WolfStreet.com

•  Things I Don't Care About And You Shouldn't Either: "One of the biggest challenges for investors is filtering out bad, useless or even costly 'information.'"--SeekingAlpha.com

•  Faulty Wall Street Assumptions: "Complex markets require complex solutions." To me, this is one of the most damaging myths out there for most investors. The simpler, the better ... There are no extra points for degree of difficulty.--aWealthOfCommonSense.com

•  The New Corporate Power Brokers: Passive Investors: "Index-fund managers such as Vanguard often cast deciding shareholder votes on issues such as mergers and leadership changes."--WSJ.com

•   Bubble Mentality Collapses in San Francisco Office Market: "This is how office markets turn. Activity plunges as demand suddenly fizzles, while new supply floods the market. Exuberance evaporates. Suddenly companies and landlords go into a standoff, and not much happens until rents come down. But once rents start coming down, companies are holding out for even more concessions and lower rents. Rather than bidding wars, tough negotiations set in, now that vacancies are rising for everyone to see. And the whole bubble mentality collapses into something resembling rational and focused business decision making."--WolfStreet.com

•  Financial Ideas vs Marketing Ideas: “There’s one good financial idea every decade or so, and 5 to 10 marketing ideas a week.”--Eugene Fama as quoted in The Art of Doing Nothing--aWealthOfCommonSense.com [Clue: ICANN's new gTLDs are just a "marketing idea"--no real innovation nor financial ideas are involved.]

•  Gundlach Says ‘Look Out’ for Exploding U.S. Deficits | Bloomberg.com Oct 25, 2016: "Bond yields bottomed and prices peaked in July, Jeffrey Gundlach said. Federal Reserve Chair Janet Yellen wants a “high pressure economy” with inflation above 2 percent and the unemployment rate below 5 percent, he said."  Gundlach still believes Donald Trump will win:“Trump would -- and will when he wins -- ramp up the deficit,” Gundlach said." See also Gundlach: Why the “Rates Will Never Rise” Argument Doesn’t Hold Up | WealthManagement.com: “In July, people came on TV and I actually heard the phrase, ‘rates can never rise,’” he said. “One thing I’ve learned is that in the investment business when you hear the word ‘never,’ it’s about to happen.”

•  Gundlach's view on Trump may be vindicated on November 8. There are two indicators that Trump may be doing better than polls suggest in some states, reports the New York Times--If They Google You, Do You Win? | NYTimes.com--1) The main insight from Google searches this year is that African-American turnout may be down in 2016; 2) nationwide, there are more searches that include “Trump” before “Clinton” (where a search includes the names of both candidates, the name appearing first is a known preference indicator in favor of that candidate). Even the latest re-emergence of the Clinton email scandal now favors Trump: more than 3 in 10 voters say the news made them less likely to support Clinton according to a Washington Post-ABC News tracking poll.

• Q3 2016 financial results coverage this coming week on DomainMondo.com:

• Alibaba Group $BABA Nov 2 at 7:30 am ET
• Facebook $FB Nov 2 at 5:00 pm ET
• GoDaddy $GDDY Nov 2 at 5:00 pm ET

•  A Look Back to August 31, 1999: Whatever Happened to Globalization? | Fast Company | Business + Innovation | fastcompany.com: "Overcapacity plagues every industry — from automobiles to computer chips to beer. Quite simply, we are producing more stuff than people can consume. So it's harder to differentiate yourself. It's harder to charge premium prices. And it's harder to innovate — because product improvements get copied at light speed. Channel issues pose an even bigger problem. History teaches us that no old channel of distribution ever adapts quickly enough to the emergence of a new channel. And with the rise of the Web, new channels of distribution — along with entirely new business models — are being created faster than ever before. Traditional assumptions about strategy, pricing, and selling are under fierce attack. The Web threatens to turn every industry upside down and inside out."--Martin Sorrell

-- John Poole, Editor, Domain Mondo 

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MacroView: Nationalism and Protectionism Now Rising In Germany

Domain Mondo's weekly review of  macro economic and investing news:

MacroView Feature • Protectionism: Behind the scenes, a new Germany AG (Germany Inc.) formed--welt.de: "Protectionism in Germany is no longer a dirty word." While nothing has yet been decided, solutions are being worked on “behind the scenes,” according to Die Welt and a follow-up in WolfStreet.com. Four events in particular are reported to have shaken German industry leaders:

1. Deutsche Bank’s potential fine of $14 billion proposed by the U.S. Justice Department to settle allegations concerning mortgaged backed securities sold before the financial crisis by Deutsche Bank’s U.S. unit. The largest U.S. banks have already settled, and Deutsche Bank’s fine would not be the largest one.
2. Volkswagen’s nightmare legal situation in the U.S., and, to a lesser extent, in other countries, as a result of  VW's dieselgate fraud.
3. Acquisition of German robotics company Kuka by Chinese firm Midea.
4. Proposed acquisition of lighting specialist Osram by Chinese firm San’an Optoelectronics.

Some German CEOs reportedly want a “conceptual revival of Deutschland AG” (Germany Inc.). Deutschland AG was a network of banks, insurance companies, and industrial companies in the latter half of the 20th century, largely dismantled in the 1990s. BDI’s Kerber told Die Welt: “We’re demanding reciprocity from countries like China. If the Chinese want to buy German high-tech firms like Kuka or Osram, then Germans must be able to completely take over Chinese enterprises too.” 

Relations with China have become increasingly difficult, these executives are reported to have said, as foreign firms cannot start their own subsidiaries in China but have to do it with local partners in joint ventures, and even then, technology transfers are required, plus foreign firms cannot takeover Chinese firms but are only allowed to buy stakes in them.

Question: if China (to take just one example), has continuously been following its own nationalistic and protectionist policies, why has the World Trade Organization (WTO) and its other member nations allowed it to do so? The rise of nationalism and protectionism, in large part, is a reaction to the failure of the World Trade Organization (WTO), and other nations (U.S. included), to hold China (and others) accountable. We may be at a "tipping point."

•  The Globalization Backlash Is Reverberating Through Boardrooms | Harvard Business Review | hbr.org: "Evidence of de-globalization ... is everywhere. This has significant and far-reaching implications for corporate decision making. Boards of directors of global corporations will increasingly face strategic choices and capital allocation decisions framed by mounting geo-political risks. Three trends characterize the environment within which global businesses must contend: rising trade protectionism and a concomitant fall in global trade volumes, declining cross border capital flows, and mounting regulatory requirements. As a practical matter, for example, these changes in the global policy regime are forcing multinational corporations to scale back and sell parts of their international operations. According to the World Trade Organization, international trade this year will grow at its slowest pace since 2007."

•  Stock Prices Under Threat as Global Trade Becomes a Pariah | WSJ.com: "... there is worry that the party is ending. “We believe globalization has probably reached its peak,” said Marino Valensise, head of the multiasset team at Barings, a member of the MassMutual Financial Group with $275 billion in assets under management. “The market won’t like it.”"

•  Canada Walks Out as EU Trade Talks Founder: "... unable to break a deadlock with a small Belgian region that has been defying multinational efforts to have the pact signed next week."--NYTimes.com. See also EU Leaders Predict Dire Future if EU-Canada Trade Deal Fails: "Fearing final rejection by a small Belgian region, leaders of the European Union warned early Friday that if a free trade deal with a close partner like Canada fails it could mean the end of such agreements with any other country."--NYTimes.com

•  Rail rout sending bad signs about the US economy? "On a global level, the school of thought that the health of railroad stocks tracks the health of the overall economy may hold true. "When you think of it from a global macro perspective, we are starting to see some serious cracks in global growth," Boris Schlossberg, managing director of FX strategy at BK Asset Management, said Thursday on "Power Lunch." Schlossberg pointed to a miss in industrial production in China this week, a "massive" miss in Australia's employment numbers and central bank leaders' recent warnings about "structural" issues with global trade, referring to recent remarks by Bank of Canada Governor Stephen Poloz. "So there are clearly some warning signs out there that I think something is slowing down, whether it just simply pauses and refreshes, or really we're going to start to fall off a cliff; I think is too early to tell," Schlossberg said."--CNBC.com

•  Fed risks repeating Lehman blunder, US recession storm gathers: "... The truth is that nobody knows whether this is the start of a sustained reflation cycle, or just the last feeble flicker before America, Europe, and East Asia are swallowed into a deflationary vortex, the frozen circle from which there is no easy exit ..."--telegraph.co.uk

•  Amazing Down Spiral of Atlanta Fed’s Q3 GDP Now Forecast | : "By now no one even tries to trot out the illusion of hitting “escape velocity” next spring."--WolfStreet.com

•  EVs vs Big Oil: A move away from oil as a transportation fuel could send global oil majors, such as ExxonMobil, Chevron, Total, and Royal Dutch Shell, into an “investor death spiral,” says a new report by Fitch Ratings.  Transportation accounts for 55% of oil consumption. “Widespread adoption of battery-powered vehicles is a serious threat to the oil industry ... [and] could tip the oil market from growth to contraction earlier than anticipated.”--FitchRatings.com

•  China's Venture Capitalist Local Governments: "Local governments across China are getting into the venture-capital business, deploying a combined 3 trillion yuan as the Communist Party resolves to modernize the economy and reduce debt-fueled spending on infrastructure. The money is meant to spur development of biotechnology, internet and high-end manufacturing companies that can replace the stumbling heavy industries sapping economic growth."--Bloomberg.com

•  Q3 2016 financial results coverage this coming week on Domain Mondo:

• Apple AAPL Oct 25 5:00pm EDT
• Neustar NSR Oct 27 4:30pm EDT
• Alphabet GOOG Oct 27 4:30pm EDT
• Verisign VRSN Oct 27 4:30pm EDT
• Twitter TWTR Oct 27 5:00pm EDT
• Amazon AMZN Oct 27 5:30pm EDT

•  One More Thing: "Rigged"--Journalists shower Hillary Clinton with campaign cash | Columbia Journalism Review | CJR.org: "New Yorker television critic Emily Nussbaum, a Pulitzer Prize winner, spent the Republican National Convention pen-pricking presidential nominee Donald Trump as a misogynist shyster running an “ugly and xenophobic campaign.” What Nussbaum didn’t disclose: she contributed $250 to Democrat Hillary Clinton in April ..." See also: What WikiLeaks hack says about Clinton: Our view | USAToday.com: "Now we know why she didn't want those Wall Street speeches made public ... Sounding like an ardent free-trader in a 2013 speech, Clinton told one group of bankers: “My dream is a hemispheric common market with open trade.” This was consistent with her stance as secretary of State in 2012, when she praised the proposed Trans-Pacific Partnership (TPP) as “the gold standard” of free trade agreements. By 2016, however, Clinton faced populist challenges first from Bernie Sanders and then from Donald Trump. She now opposes the TPP and has few good things to say about free trade ... Clinton had two ways to inoculate herself against any damaging leaks from her Wall Street speeches. One is that she could have released the transcripts months ago, inconvenient as that might have been. The other is that she could have turned down the speaking engagements in the first place ..."

-- John Poole, Editor, Domain Mondo 

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UK Prime Minister Theresa May: Brexit & Change Are Coming (videos)

Theresa May: Speech to Conservative Party Conference 2016:

Navigating change in a turbulent world--UK Prime Minister Theresa May: Brexit & Change Are Coming--video published Oct 5, 2016.  The UK PM's closing speech at the Conservative party conference which included a strategic move to lure the working classes and make Britain a "fairer Britain." Speech Transcript (pdf).

Building a country that works for everyone:

Video above published Oct 5, 2016, by the Conservative Party (UK)--Domain: conservatives.com; Twitter handle: @Conservatives.

Tory civil war off the agenda:

A few months ago some were predicting the Conservative party would be thrown into civil war by the Brexit vote. Perhaps it would even have to split. The FT.com's Henry Mance reports from the Tory party conference about why that has not happened. Video published Oct 5, 2016.

City (London's financial centre) calls for clarity on Brexit:

Barclays’ John McFarlane, David Sproul of Deloitte and Ratesetter’s Rhydian Lewis express concern over future access to the EU's single market and skilled labor. Video published Oct 3, 2016. 


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ICANN Open Forum at IGF 2015: IANA, Globalization, Accountability, Trust

Video above: IGF2015 Day 2: ICANN Open Forum

ICANN OPEN FORUM Transcript, IGF2015, Nov 11, 2015: "The following are the outputs of the real-time captioning taken during the Tenth Annual Meeting of the Internet Governance Forum (IGF) in João Pessoa, Brazil. Although it is largely accurate, in some cases it may be incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the event, but should not be treated as an authoritative record."

Transcript excerpts (for full transcript go to link above)(emphasis added):

DR. STEVE CROCKER (ICANN Board Chairman):  Good morning, everybody.  It's a pleasure to be here.  The ability and the pleasure of being here is that among other things, Brazil is a country that fervently backs the multi   that so many of us view as a model for internet governance.  We're forever looking forward to the future as I mentioned last year's meeting in Istanbul.  Let's take a minute and look back briefly at the events of the past year.

First of all, about the IGF, we're pleased that WSIS + 10 review draft UN resolution released last week called for an extension of the IGF for another 10 years.  That's great.  Major point of discussion of the meeting and one of the big accomplishments. The draft resolution also recognizes the need for all stakeholders to engage in dialogue in Internet Governance issues, which is of course what the IGF's all about.

ICANN has consistently been a strong supporter of the IGF since its inception, increased its support over the past 10 years; and it views IGF as a positive example for stimulating constructive dialogue on Internet topics on global multistakeholder community.  We're active in IGF at all leaves east, presenting in the dialogue and initiatives presented threw these forums.  We applaud both on the regional and national levels to garner stakeholders in the development in the developing world.  This year ICANN participated in the eighth Latin American Caribbean IGF August 2015 in Mexico.  IGF called you are oh dig in Sophia, the 11th Caribbean IGF August 2015 in Trinidad and Tobago and the fourth Africa IGF in September 2015 in Ethiopia.

Quite a lot of attention has been focused on the transition of the IANA stewardship and the accountability process.  These have occupied quite a lot of our attention and everyone else's during the past year. It was a featured session at last year's IGF in Istanbul and is featured in a main session of a number of workshops here.

The IGF community was clear that accountability and the IANA transition go hand in hand.  The community's participation thus far has been extraordinary.  At ICANN we have calculated that the staff and Board Members have participated in an estimated 860 or so events around the world where IANA stewardship or enhancing were discussed, debated, organized or planned between March 2014 and October 2015 this year.  That's equivalent of almost 45 events per month.  We're thinking of taking on our own radio station "all ICANN transition all the time." [Laughter]

Of these events, roughly 520 were joined through global webinars or calls, while an additional 345 were attended in person, spanning over 87 countries around the world.  That's not enough numbers.  I have some more for you. Roughly 300 people have been involved with the working groups.  More than 40 meetings have been held.  And there have been 25,000 or so mailing list exchanges just on the accountability mailing list. While we're able to track more closely the number of events that ICANN staff and Board have participated in, there have been countless people around the world participating in both you numbering processes coordinated by the regional Internet registries and the protocol parameter processes coordinated by the IGF via phone calls.  That's a lot of participation.

These have not all been dry.  There have been some spirited discussions surrounding the transition at the ICANN meeting in Dublin.  And by spirited, I'm sure most of us understand that that means a lot of Guinness and Jamisons, as well. In spite of that, or perhaps because of that, the cross community Working Group on accountability and the IANA coordination group, the ICG, reached significant results.  The latter, the ICG finalised its IANA stewardship proposal dependent upon the outstanding dependencies on the naming CWG stewardship and CCWG there will be a test to see if you get all these acronyms.  The CCWG made real tangible progress in Dublin on many of their outstanding recommendations, notably deciding to focus on developing the sole designator as the legal enforcement mechanism for their new community powers.

It's very important that people stay involved.  We know it's been a long process, but the CCWG's getting close and continued engagement and participation will be the key.  The CCWG accountability will launch a 35 day public comment on their third draft of work stream 1 recommendations beginning 15 November.  That's this Sunday until 21 December.  At the launch, the CCWG will launch a 20 to 30 page high level overview of the proposal, a summary of the key changes from the previous draft and documentation on how the proposal meets both the CWG and the NTIA requirements.  Approximately 15 days into the public comment, that's at the end of this month, the CCWG will then release the full indepth proposal including appendices and process documentation.

Pending no major changes or concerns raised in the public comments, the CCWG accountability aims to submit a proposal to the ICANN Board by mid January 2016. I'm often asked what will the Board do with that?  The Board is committed to transmitting the proposal unchanged. We have reserved the right, as is part of the process, to add whatever comments we want to add.  We have inserted well in advance that we won't add any contents that is not what we have previously discussed.  And it is our firm intent and hope that we will be entirely supportive of the proposal, that we'll be able to turn it around very quickly and to NTIA that it can be reported.  That's the hope.

This group more than most realises that the coming year will be a significant one in the history of Internet Governance.  It's important that we realize the process we're currently undertaking and it is an important part as the destination will be ultimately reached.  I mentioned in Dublin the manner in which we reached that destination will ultimately define us.  My hope is that we remain one of inclusivity and transparency.

Globalization at ICANN:

FADI CHEHADÉ (ICANN CEO):  Globalization at ICANN works on four levels.  At the first level is operational globalization.  And I think the record of the last three, four years shows that ICANN has become, in many ways, operationally global.  First we divided our Headquarters into three global hubs, one in Los Angeles serving north and South America, one in Istanbul serving Europe, Middle East and Africa, and one in Singapore, serving Asia and Oceana.  So by splitting the Headquarters into these three hubs, we were able to also split the main operational functions of ICANN whilst not too long ago, for example, all the legal staff of ICANN was in Los Angeles, trained in U.S. law, we now have legal staff around the hubs so that we can understand and work with our local communities around the world.

We also have globalised our support in this area.  Today, for the first time in ICANN's history, 24 hours a day, 5 days a week anyone can call an ICANN line and get support in all the UN languages plus Portuguese, plus Turkish and get help and support into the ICANN operations. We have also partnering with certain communities very successfully, for example, in South Korea. We are working with the local community to localise our materials.  And this is not just about translation of what we do.  This is also in preparing briefs in local languages that help the people in that region understand what we're doing and contribute to what we're doing.  This initiative in South Korea is being copied in other places.

We have also globalised our expertise.  I was just in Cairo on Thursday where we announced the first DNS entrepreneurship centre in the world, in partnership with the Egyptian community.  It is already held    it has already held 12 workshops training more than 100 people in that region on issues of DNS business, issues of DNS law and policy, issues of technical matters.  So these are the things we do to take our expertise and our operations and take them to the world. So that's the operational globalization.

The next level of globalization is to make sure that at the geopolitical level ICANN is viewed by the world as an organisation, as a community, as an institution that is accepted to be serving the world, not serving any one community.  And I think the work of the last few years also demonstrates, without question, that starting here, in fact, in Brazil, in April 2014, how the Brazilian government embraced ICANN and the multistakeholder model and allowed us to move forward with their blessing and with their support to continue the work we've been doing for over 16 years.

Following that, the Chinese government, which for a long time was still searching for its place and role in ICANN, announced at the ICANN meeting in London in June 2014, at the highest level, first time ever in an ICANN meeting, that China is also supportive of one Internet for the world with ICANN and its partners, the IETF and the regional Internet registries coordinating the affairs of the unique protocol identifiers.

And then most recently, and really the cherry on top for us, was India's move at the Buenos Aires meeting in June 2015 where His Excellency, Minister Prasad sent us a powerful message how this great message of India, an India that is rooted in democratic, open policies that we all support and embrace, is now joining the global community in its support for ICANN and its role as the coordinator of the unique protocol identifiers.  These are geopolitical shifts that happened at ICANN meetings, giving ICANN the geopolitical presence that it needs.  And this train continues now with more and more countries as we've signed tens of MOUs in the last four years supporting our role as the coordinator of those functions.  That's the second level of globalization.

The third level of globalization was to make sure that ICANN itself is independent.  You cannot claim that you're global if your affairs are viewed or perceived as being either overseen or controlled by one party.  And I think it's pretty clear that the United States Government has had a very fruitful partnership with us for many years; however, the time for a unique role for any one government is done.  And I think all of us who have worked so hard over the last two years to finish this phase of our life and to bring to the end the fruitful partnership we've had with the U.S. government and to give ICANN the global independence that it needs is now.  And I'm confident, I'm sure many of you are around this table and around this room, that we will finish this project next year, and we will end up with an ICANN that the whole world can see serving everyone without the particular influence of any one group or one party or one government or anyone, but serving the public interest.

And, finally, to close, there's a fourth element to globalization.  And that's globalising the DNA of a community and of an organisation.  And that's the toughest one.  I was involved in the 2008 timeframe in the globalisation of a big chunk of the ICANN global services organizations, and I remember how easy it was to build offices around the world, put people around the world.  Today ICANN has 30 locations.  It's the easy part.  Building the globalization is the easy part.  The difficult part is to make everyone not just the ICANN staff or the ICANN board, but the ICANN community change the DNA of this organisation to understand our global role and to understand that the billions of people we're adding to the Internet today do not even have a Latin keyboard.  It's a brand New World.  And the world is large.  And the world is complex.  But the Internet is for everyone. And if ICANN is to maintain its globalisation, we cannot simply say we have people in 30 countries or 30 locations; we have to say "we think locally.  We may act globally, but we think, we understand our communities.  We cannot continue to be caught thinking with a U.S. centric or western centric frame. We have to think like the world and we do this by engaging and listening and participating.  And I think we're on the way to get there.  This is a non stop mission.  And I know that ICANN is committed to this.  So thank you very much. 

Question from Peter Dengate Thrush: ... I suppose the question for Fadi is having set those up, what do you see as the next set of challenges and continuing that?  Do you see more offices?  Do you see more people or some other way forward?  I know you're going to be leaving shortly, but if you were to look back in three years' time, what would you hope would have been achieved in that period?

FADI CHEHADÉ: I do not believe that the next three years will require a major further expansion of ICANN and its size or staff. Quite the opposite. I made the commitment, as you know, to start slowing down the growth of ICANN. And we are on track. We have slowed down the growth last year and this year again and next year to make sure the growth kind of levels where we are. In terms of specifics, I do believe we before I leave, I hope we will complete the strategy and the implementation of adding one more engagement centre in Africa. That's something I'm hoping we can get done. Right now, if you look at the ICANN presence map, quite frankly, besides Baher in Egypt, it's a little bit lacking. So we will address that. And the community is now in dialogue to help us figure out how to do this.

I do believe the central theme of the next three years will be set by our Board and my successor, who will hopefully be named early next year. But my sense of this and I haven't thought about this, so I'm being direct with you here is that what ICANN needs to focus on in the next three years is trust, is strengthening the trust in our organisation. And it starts at home of the it starts building the trust between us and making sure that the parts of our community feel that we're working together. We've been rightfully battling. A little bit of mistrust is always good, as professor Hofmann told me yesterday, it's good because then we check on each other. But we need to find that balanced middle ground. And the institution, the community and everything we do has to strengthen that trust so that also when people come from outside for the first time, they see us as a community that may battle, but at the end of the day there is trust in this community. And you've built it when you were at the helm. We continue to build it. And I believe that the next phase will be very important, even more important because we are though now an independent organisation, and the world will need to trust us to do what we do and do it well, inclusively, openly. So I really hope that we don't lose that momentum, that we continue in that direction. And I'm confident, by the way, everything I see in the Board's activities to prepare the new CEO and to prepare for a new CEO is very assuring and reassuring. And I'm confident ICANN will continue in its trajectory.

Question from Steve DelBianco with NetChoice and the ICANN Business Constituency:  Fadi, even if we were on a boat in the middle of the ocean, I realize that it isolates the employees from those regimes; but we do create policies and enforce contracts that affect registrants and users all over the world, and therefore those activities are subject to the laws of the countries where those registrants and users live.  So the speaker who asked the question might have thought that putting employees into country means that ICANN has to ensure that the laws of that country are respected, but that's the case anyway, whether the employees are there or not.  There are special concerns about employees, but they don't suddenly increase the need to pay attention to laws. And, Fadi, your answer to Peter about ICANN's evolution used the word "trust" many, many times and I'm not even sure how that would translate into all the languages we work with.  But in the accountability transition track, I don't really know that trust was at the nub of coming up with the community accountability mechanisms.  It's more about the community if it disagrees with the management and Board's interpretation of some very fluid concepts like fiduciary duty, global public interest.  These are concepts that are difficult to nail down.  And there may be instances where the community as a consensus comes together and says" respectfully, Board, we don't agree with how you've interpreted your fiduciary duty on this. "And that is why the community powers are designed.  And that disagreement has nothing to do with trust, right?  It has to do with a different perspective.  When you're on the board, when the people move from this side of the table to the Board they are now have more of a duty to the corporation than they did before and it's a broad duty to the public interest of the community. So it's not about trust as much as it is about disagreement of interpretation and I think that helps to take the temperature down because we didn't really have a trust problem as much as a disagreement issue.

FADI CHEHADÉ:  When I speak about trust, I'm not speaking about trust between individuals. You and I trust each other and know our intentions are good.  I'm speaking about institutional trust.  So everything the community has done to strengthen accountability increases the trust in the institution. These things are very congruent and I think we're aligned.  That the community putting the right checks and balances within this institution and the community is precisely what makes anyone looking at us from the outside say "this is a trustworthy institution and community because they check on each other, they have a healthy dose of mistrust between part of the organization that allows them, then, to check on each other." So I think the work on accountability is in many ways a tremendous boost for in making ICANN a trustworthy institution in community.  And, frankly, I know the role you and many around the table have played, Jonathan and others, and, frankly, history will show that this is what made ICANN a better place and a more trustworthy place. 

Comment from Veni Markovski, ICANN's Vice President from UN Engagement: ... The globalization efforts are positively accepted at the United Nations. Through the work of ICANN, GAC participation but also ICANN has government engagement team people in EURIC of and Geneva. This allows us to share knowledge about ICANN and what it does to all UN agencies and to the permanent missions to the UN as well as the knowledge about UN and its Internet relationship work to ICANN. This bidirectional constant communication is a good example of how the Internet has changed in the last few years.

When Will the IANA Transition Be Finished?

FADI CHEHADÉ: So just to remind you history wise. The transition was announced on March 14th at 2:30:00 p.m. U.S. Pacific time in 2014. That's when it was announced. That's when the train started. So it's been, let's say, a little less than two years. The community has been working very hard to get a proposal ready for the U.S. government to review and to grant us the end of this stewardship, the contract, essentially. At the moment, expectations are and I'm going to either hear people stand up and yell at me or agree with me is that we will give the U.S. government the proposal sometime in mid January 2016. Any disagreement from those who are driving the bus? Because I'm not driving the bus. Plus or minus. Add a couple of weeks here or there, let's say mid January 2016. And then the U.S. government has to consume this proposal.  They have to study it, to review it.  At the end of that process, the U.S. government should either say they're okay with the proposal or they're not okay with the proposal.  The expectation is that that will happen sometime in the March/April/May timeframe.  So the U.S. government has always said they need 60 to 90 days to do that.  So if you add 60 to 90 days to mid January, then you're looking at mid March to mid April.  That's at least the current plan. And then after that, we are just implementing the proposal.  And at the moment, our community has looked at the implementation and believe that we will complete it on time before the contract expires on the 30th of September, 2016.  Naturally.  The contract will expire naturally at that point. If we're not done, or if the implementation is not done, then 30 days or so prior to September 30th, 2016, the U.S. government could either in agreement with us or unilaterally extend the contract further.  At the moment, no one is expecting this will occur, but it could and that's what we're working against. I hope we answered your question and thanks for your patience through the process.  We're working hard to get it done.

See also on Domain Mondo: IGF 2015 Workshop on the IANA Stewardship Transition (video)


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