30/05/2006

Swiss Scotch

You know that something has gone mainstream if Swiss retailer Coop writes about it in its newspaper. Case in point is malt whisky. But Swiss whisky? Swissky? Switch??

There seems to be about a dozen or so distilleries producing whisky in Switzerland. The best reviews (according to Coop Zeitung) are accorded to Zürcher and Swissky. I am still not sure whether that's the right present to bring around next time I go to Scotland ...

29/05/2006

Crowd power

These are two very loosely linked, but no less interesting instances of crowd power: Wired has coined a new business modell-related term again, namely crowdsourcing. The idea is that jobs get outsourced to "the web" of people that is connected via the internet. As always, the hit/noise ratio is low, but given the right search algorithms, that's not a problem (long tails, anyone?). Case in point is iStockphoto, where you can purchase the rights to stock photos for next to no money at all, what used to cost hundreds ...

The other instance is political, and thus more conventional in nature: Addio Pizzo does not say good bye to pizze, but rather to pizzo, which is the racket paid in Sicily, Italy. Addiopizzo is a movement started by young folk in Palermo. Sick of the Mafia, they flooded the city with stickers stating that An entire people paying the racket is a people without dignity. Now, the movement seems to gain traction - there's shopkeepers openly stating that they don't pay up, and a consumers' movement to only shop at those shops. This approach addressing the Mafia's business modell is much more promising that decades of police work. Avanti, Addiopizzo!

23/05/2006

Conferencing

If you're wondering what's happening here, or rather, not happening here, then welcome to the Club! I am currently attending the CFA Institute's Annual Conference with all assorted meetings, and that takes up virtually all of my time. But I'll be back starting Thursday, I hope.

17/05/2006

15/05/2006

Guerilla Consumerism?

Weird. From May 19 to June 24, Basle will be hosting a Comme des Garçons guerilla store (via Metro | Basel). So, Basle seems to be a hip location after all, being in the same league as Glasgow, Hong Kong, Warsaw, Athens, Reykjavik, Cologne and Singapore. And, hey, we even have football skirmishes!!

At any rate, it is certainly no coïncidence that that store's opening period encompasses Art | 37 | Basel, which will bring oodles of artsy folk to our shores.

11/05/2006

Allons enfants de la piraterie ...

Since I am in publishing mode, I might as well let you have the article I've recently published in Professional Investor. Here you go. It deals with the ongoing intellectual property right action in France and Apple's position with that regard, and yes, I am aware that things seem to have changed a little meanwhile. But never underestimate the French and their zeal for (successful!) street action ... I haven't really seen that revised text, yet.

Changing and growing

Occasionally, I feel to urge to do a bit of political analysis. This urge has grasped me yesterday, so I did an analysis of Mr. Putin's State of the Union Address of yesterday. It's also published on Newsvine.

It is interesting to analyse the State of the Union Address given yesterday by Vladimir Putin, President of the Russian Federation, especially if read after US Vice-President Cheney's remarks at the 2006 Vilnius conference a few days earlier.


Surely, nobody will object to Mr. Putin's strategic goal for Russia to become a country with a flourishing civil society and stable democracy, guaranteeing human rights as well as civil & political freedoms while building a competitive market economy protecting property rights and improving the nations defence.

Yet, the speech breathes an oppressive combination of swaggering calls for unity in the face of menacing competition, and a lack of self-assured confidence that is the prerequisite for a dependable great power and international partner. Seeing how this State of the Union Address is a carefully crafted piece of consensus opinion of the ruling Russian administration, it would indeed appear that Russia is returning to its age old paradigm of feeling surrounded by ominous foreign powers which are vying after the nation's sovereignty, as very recently explicitly stated by Aleksandr Solzhenitsyn.

This does not bode well for Russia and the world.

On domestic issues, there is a lot of very clear sighted analysis of present problems as well as awareness of the current window of opportunity to resolve many of those problems, due to the "favourable economic situation" (read: oil price). Since the oil price is not explicitly mentioned, it is obviously a somewhat painful recognition that this window of opportunity has opened without Russia's initiative and thus might close again at any time.

Mr. Putin pays a lot of attention to necessary changes in bureaucratic and economic structures, stressing the importance above all of economic growth which is to achieve a doubling of the Russian GDP by 2010. This is to be reached by changes in infrastructure monopolies, which account for an ever increasing share of the economy, and by a reduction in the scope of government intervention. We almost think of laissez-faire when reading about the Russian people who "can achieve this better life if only we do not get in their way. At the very least, we must not get in the way, and it would [be] better still if we help." Competition appears to be accepted in the abstract as a governing principle of order, but it is considered to be a zero-sum game and not one to mutual advantage.

Yet, despite of all the recognised need for growth and change, there is a surprising reluctance, if not resistance to reform: "We do not need reforms purely for the sake of reforms. We do not need a permanent revolution." This, I think, is a clear indication of the deeply rooted fear that the administration harbours towards the mutual interaction between the political and the economic sphere in an open society. Witness the very opaque elimination from political life of Mr. Putin's potential rival, Mr. Kodorkhovsky. Evidently, Mr. Putin still thinks in terms of a command economy which has to supply growth, but must not interfere with politics. While such an approach is comprehensible in the aftermath of some chaotic transformation years dominated by a financial oligarchy, it is doomed to fail in the long run. One of the key factors to be observed is Mr. Putin's hope for greater transparency of how political parties are financed.

Sustainable growth in the face of technological and organisational innovation requires constant reconfiguration of the economy and the regulatory environment. Failure to do so will lead to stagnation and the breakdown of growth, which Russia is already beginning to suffer from.

I'd like to note some specific points of interest now.

1) Russia's membership in G8 seems to be of outstanding reputational relevance.

2) The Russian currency should become fully convertible.

3) Russian demographics poses a formidable challenge to growth, especially given the low overall density of population. The relative attractiveness of Russia as an immigration targets from other CIS Member States requires an effective immigration policy.

The address also contains several foreign policy statements, not the least important of which is an outright declaration that the CIS is Russia's sphere of strategic interest. This constitutes an explicit demarcation of scope of the Putin doctrine, which some CIS members will fail to agree with.

Otherwise, Russia aims for stability and predictability of the international order under the rule of international law.

Russia aims for true integration into Europe as a foregone historical choice. In that choice, Mr. Putin fails to realise however that the establishment of a cordon sanitaire of formally indepentent satellite states between herself and her partners of integration cannot be seen as a committment to equitable partnership.

The State of the Union Address also touches on the modernisation of the armed forces. While there is talk about the move to a professional army, air force and navy, to be completed by 2007, it is not clear at all that this means the abolition of compulsory military service - on the contrary: From 2008, the much feared compulsory service is halved to one year. Russia is also planning to introduce new strategic weaponry.

By way of introduction, I mentioned US Vice-President Cheney's speech in Vilnius, former part of the Soviet Union and now firmly entrenched in the EU and NATO. Already the fact that Mr. Cheney is able to launch his attack on Belarus and opponents of reform and further opening in Russia - or imitation of the West, as Mr. Solzhenitsyn would put it - from that vantage point must be perceived as an act of aggression on the part of the Russian administration. For, whether one agrees with the current US administration's evangelism for formal democracy or not, it is hard to overlook the discrepancy between Russia's strategic goal as stated in Mr. Putin's address, and its present day political life, where foreign support of broad voter participation and the promotion of independent news media organisations are suppressed, and influential political rivals jailed.

One of the key issues of Russian self-confidence remains with its perception of its own history. As long as Russia fails to accept that there are dark spots in its history (as in every other nation's), it is unlikely to be a fully dependable member of the international community of open societies. But there is hope: Earlier this year, we have celebrated the 50th anniversary of the Secret Speech with which Nikita Khrushchev started the first reform movement within the Soviet Union, doing away with Stalinism (which, incidentally, is being revived in today's Russia). It may be the next President of Russia who realises that the breakdown of the Soviet Union was a historical bonanza rather than a catastrophe - even for the Russian people.

01/05/2006

Paris, not Texas

Remember that I vowed not to fly to Paris next time? Seeing how I have a lunch appointment there next month, I was afraid I had to do it all the same, until I discovered TGV. OK, admittedly no giant step for mankind, that - but I never travelled by TGV myself. Also, I quite like the fact that I got a first class return ticket for a mere CHF 94, which is really bon marché.

Going to Paris just for lunch might seem slightly out of proportion, but I am looking forward to combining that with the half-yearly meeting of the General Council of the University of Edinburgh, which is held abroad for the second time already, with London being counted as a foreign country from a Scottish perspective ... well, I am certainly looking forward to a reception at the British Embassy in Paris (remember see ivil French revölüshönairies from Blackadder ?) and a Dinner at the Palais du Luxembourg.