• Home
  • About
  • The Good Strategy Blog
  • Strategy
    • Data Warehousing
    • Ask Martyn

GOOD STRATEGY

~ for every significant challenge

GOOD STRATEGY

Category Archives: disinformation

Big Data is Bullshit – 2017

19 Thursday Jan 2017

Posted by Martyn Jones in 4th generation Data Warehousing, All Data, Big Data, Big Data 7s, Big Data Analytics, dark data, data architecture, Data governance, Data Lake, data management, data science, Data Supply Framework, Data Warehouse, Data Warehousing, disinformation, governance, information, Information Management, Information Supply Frameowrk, Information Supply Framework, pig data, The Amazing Big Data Challenge, The Big Data Contrarians

≈ Leave a comment

Marty Richard Jones

Mountain View, 19th January 2017

“I’ve been accused of vulgarity. I say that’s bullshit.” – Mel Brooks

If you enjoy this piece or find it useful then please consider joining The Big Data Contrarians. Continue reading →

Consider this: Financial Crisis and Subprime

01 Monday Dec 2014

Posted by Martyn Jones in awareness, Banking, Consider this, disinformation, Dogma

≈ Leave a comment

Tags

financial crisis, Organisational Autism, Risk, subprime

Consider this: Financial Crisis and Subprime.

Martyn Jones

This is a republication of a piece written in 2009 on the subject of the Financial Crisis and Subprime loans. As the spectre of overreach and unhedged risks raises its ugly head once again, the temptation to republish this piece was just too much to resist.


Oh dear, whatever happened here? After years of over-borrowing and under-saving, the plentiful supply of cheap and easy money, the enthusiastic recklessness of a number of financial managers, and the complaisance of governments, the inevitable happened, and panic ensued.

It has not been edifying to see political leaders – people at one time we might have considered intelligent, cautious and wise human beings, falling over each other, in the courageous rush to identify scapegoats, to nationalise bad debt and to prop up failing companies.

After cursory deliberation, the condemnatory finger pointed at short sellers and Hedge Funds, and this mendacity passed by with little comment. Thankfully, the new blame game does not seek to target a conspicuous group of people, such as Swiss gnomes, which is progress of sorts, but it is still only a marginal improvement.

So, what caused the financial crisis? Superficially, the answer is simple; it has been the collapse of the subprime market and its impact on underwriters of usurious lending.

There was a time when people with bad credit ratings, or no credit ratings at all, would have found it difficult to obtain a high street loan to purchase a second-hand car, and would have had no chance of obtaining a housing mortgage.

Cheap and plentiful money, overvaluation and the property boom, changed all of that.

Subprime allowed people with dodgy credit ratings to acquire mortgages, albeit with inflated interest rates and draconian small print.

For years, things worked quite well, as the number of people keeping up with their repayments well-exceeded analyst’s forecasts, which meant that profits from subprime lending surpassed expectations.

This led to two things. The further downplaying of risk in the subprime market, and a boom in the number of banks offering subprime loans.

Traditionally, banks lent out money that they held in the form of deposits, in exchange for timely repayments. In many countries, banks were constrained by how much exposure to risk they could assume, in order to ensure solvency and liquidity; so, even when money was at its cheapest, they could not legitimately expand their subprime business beyond certain levels, without getting creative and by passing on risk to third parties.

What happened next? Just as some banks had cashed-in on insurance brokerage, some switched to the role of subprime lending matchmakers. This meant that they were able to take the upfront brokerage fees, and then pass on the loan arrangements to another financial house, and in this way, they increased their fees whilst offloading the risks inherent in holding especially risky arrangements.

Of course, the actual underwriters of these loans also wanted to reduce their risk exposure.

It is a simplistic explanation, but what these companies first did was to create a way to allow for betting on the overall performance of collections of mortgages – the fewer defaults the higher the gains, in order to allow trading in bets.

Additionally, because of the perceived low risk of subprime and the continued overvaluation of real estate, these bets came with an irresistible added value-proposition. A triple A (AAA) risk rating. “Look Ma! Just like government bonds”.

Then, these companies sold slices of these composite bets to other punters, charging for the betting slips based on a combination of risk, time duration and return.

There are various forms of betting on subprime performance, the most common products being Collaterised Debt Obligations, Mortgage Backed Securities and Asset Backed Securities, the riskiest bits of which are toxic waste.

Now, the calculation of the value and the risks in these bets are horribly complex, and frequently inaccurate. So, just to push the envelope, some people came up with a way to take a bunch of already complex pooled bets, and to create a mega pool of pooled bets, which they would then sell on to the market, as another investment product.

So, when economies tanked, it was the subprime market, mainly in the USA, that took the hit for the increase in the defaults on loan repayments. Worse still, because the holders of these bets could not honestly state either their riskiness or actual value, they became as desirable as financial crap, which meant that other banks were no longer prepared to lend them money, and for Prime Brokers to be denied loans, is like turning off their life support?

As attractive as schadenfreundin might be, letting Prime Brokers go to the wall is not a sensible option, as the survival of other companies and many jobs are also at stake.

The subprime downturn led to the current predicament, but that is not where it started, preceded as it was by the follies and frauds of the dot com era, the artificial “good times” brought on by government overinvestment in the military industrial complex and the costs of war and occupation.

We are where we are mainly because of one thing, decades of government, corporate and personal imprudence.

Many thanks for reading this piece.


File under: Good Strat, Good Strategy, Martyn Richard Jones, Martyn Jones, Cambriano Energy, Iniciativa Consulting, Iniciativa para Data Warehouse, Tiki Taka Pro

The Awkward Squad – Big data informs

11 Saturday Oct 2014

Posted by Martyn Jones in Big Data, BS, Data Warehouse, disinformation, information, Knowledge, wisdom

≈ Leave a comment

Tags

Analytics, Big Data, business intelligence, cloud, Data Warehouse, virtualisation

I am a sceptic. Part of the awkward squad of troublemakers.

People who ask questions and who won’t stop asking.

People who won’t take bullshit for an answer.

People who are not preprogramed to follow certain paths, unquestioningly.

But to question everything.

Such as, “What the feck’s that all about then?”

I’m in good company. Many people who have made a difference have been fully paid up members of the awkward squad.

People in the awkward squad might sell dog food, but we know that we shouldn’t eat it ourselves.

I used to tell people.

“If you must exaggerate, try and remember this one thing”

“What’s that then, Marty?”

“Never, ever, believe your own bullshit or you’ll ending up having to eat it”.

I remember when Cloud first appeared on the horizon, a marketing idea that was to popularise the expression “put it on the cloud”.

I vaguely remember Larry Ellison being asked about Cloud.

If I recall rightly his reply was along the lines of ‘Cloud? Oh, you mean connected mainframes and data centres?”

He saw it, others saw it, and I saw it. It had been done many times before.

But cloud was new, exciting, vibrant and well, vague enough for the market.

Only that it wasn’t and isn’t new.

The only thing is, a handful of stylists and hacks were let loose on what already existed, and they came up with a new idea, that wasn’t new, creative or innovative.

It was just repackaged. Old wine in new bottles.

I have the same issues with marketing terms such as business intelligence, virtualisation and big data.

Can you imagine Steve Jobs peddling such rebranded and rebadged crap?

I can’t.

Big data brings all the promise of being better informed by having access to far more data.

But for most things in the commercial world quantity of data has never been the issue.

If anything, we’ve had too much of it and for far too long.

We’ve been doing big data for years.

Previously we called it Very Large Data Bases.

We have been handling some forms of highly structured data for years.

We used to call it things like text management, document management and knowledge management.

Not that it matters too much.

We are still looking for real insight, but most of us are overwhelmed by countless gigabytes, terabytes and petabytes of data, and much of what we get is recycled, repackaged and ultimately repetitive.

We are drowned in data, low-utility information and marketing hype.

For all the good that the information we receive does us, we may as well be more dog.

As Ad superman Dave Trott asked, what the feck does ‘be more dog’ mean?

Exactly…

It doesn’t mean anything.

We could write a whole litany of the endless succession of IT snake-oil merchants that have passed through techy-tinsel-town flogging yet another dead-horse as the latest and greatest Kentucky Derby favourite.

But that’s just hokie. Even the media and the presses are in on it, up-close and intimate collaborators in keeping reality from us, by burying us in shit.

Remember the joke about the mushrooms?

That’s right.

“Keep them in the dark, feed them bullshit, and watch them grow”

Well, it came true.

Like life reflecting comic art.

Actually, most of us are still starved of knowledge and insight.

And, as for wisdom?

What’s that then?

Follow GOOD STRATEGY on WordPress.com

Top posts

  • Myth-busting: Data Mesh and Data Warehousing - Revisited
  • Why I called bullshit on the data lakehouse nonsense
  • The World's Best Data Quotes... Including Big Data quotes
  • Data warehousing explained to big-data, data-lake & data-lakehouse folk
  • USA: What Trumped Hillary?
  • Extracts: And, what would the Ladies and Gentlemen like?
  • Reality Check: Data Mesh and Data Warehousing  
  • 7 New Big Data Roles for 2015
  • The Big Data Contrarians: The Agora for Big Data dialogue
  • Top 10 Amazing Big Data Gurus That All Amazing Big Data Gurus Should Know

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 2,336 other subscribers

Names in the cloud

4th generation Data Warehousing All Data Ask Martyn Big Data Big Data 7s Big Data Analytics Business Intelligence business strategy Consider this dark data data architecture Data governance Data Lake data management data science Data Supply Framework Data Warehouse Data Warehousing Good Strat goodstrat Good Strategy IT strategy Martyn does Martyn Jones Martyn Richard Jones pig data Politics Strategy The Amazing Big Data Challenge The Big Data Contrarians

The Good Strat Archives

  • January 2022
  • December 2021
  • November 2021
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • July 2019
  • June 2019
  • May 2019
  • December 2018
  • January 2018
  • December 2017
  • October 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • September 2016
  • August 2016
  • May 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014

The Stats

  • 98,867 hits

Recent posts

  • Data Trailblazers: 2022 Vision January 2, 2022
  • Tea with The Data Contrarian: Afilonius Rex December 10, 2021
  • Reality Check: Data Mesh and Data Warehousing   December 5, 2021
  • Myth-busting: Data Mesh and Data Warehousing – Revisited November 25, 2021
  • Heaven help us! Have you seen the latest Virtual Data Warehouse bullshit? June 26, 2020
  • DATA! STRATEGY, INNOVATION AND VALUE BULLSHIT June 9, 2020
  • Big data’s unvirtuous circus and twelve v-words May 17, 2020
  • Laughing at Big Data – What’s on the inside May 16, 2020
  • Why I called bullshit on the data lakehouse nonsense May 16, 2020
  • Laugh at Big Data – download my ebook for free on 17th May. May 16, 2020

Hours & Info

Martyn Richard Jones
Madrid, Spain
+33 767 120 160
10:00 - 17:00
Follow GOOD STRATEGY on WordPress.com

Follow me on Twitter

My Tweets

Top Good Strat Posts & Pages

  • The Good Strategy Company
  • Myth-busting: Data Mesh and Data Warehousing - Revisited
  • Why I called bullshit on the data lakehouse nonsense
  • The World's Best Data Quotes... Including Big Data quotes
  • Data warehousing explained to big-data, data-lake & data-lakehouse folk
  • USA: What Trumped Hillary?
  • About
  • Extracts: And, what would the Ladies and Gentlemen like?
  • Reality Check: Data Mesh and Data Warehousing  
  • 7 New Big Data Roles for 2015

Good strat tag cloud

accountability advertising All Data Analytics aspiring tendencies in IM awareness Banking Behavioural Economics BI Big Data Bill Inmon Brexit BS Business business analysis Business Enablement business intelligence Business Management business strategy Challenges Commercial IT Consider this corporate assets Corporate IT Creativity data data analytics data architecture data integration data management Data Marts data science Data Warehouse Demagogism Dogma DW 3.0 Economics enterprise data warehousing EU Financial Goal Setting goodstart good start Good Strat goodstrat Good Strategy hadoop Information and Technology information management Information Technology IT business IT Strategy knowledge management leadership marketforces Marketing Martyn Jones Martyn Richard Jones MDM Offshoring operationalwareness Organisational Autism organisational awareness Outsourcing Pimps Politics project management Requirements management Risk Risk Management statistics Strategy trading traditional assets UK

Categories

  • 4th generation Data Warehousing
  • accountability
  • advertising
  • agile
  • agile way of working
  • agile@scale
  • AI
  • All Data
  • Analytics
  • anthropology
  • Architecture
  • Artificial Intelligence
  • Ask Martyn
  • Assets
  • awareness
  • bad strategy
  • Banking
  • behaviour
  • Best principles
  • Big Data
  • Big Data 7s
  • Big Data Analytics
  • blockchain
  • Books with influence
  • Brexit
  • BS
  • business
  • Business Intelligence
  • business strategy
  • Cambriano
  • Cambridge Analytica
  • China
  • Climate Change
  • Cloud
  • code of conduct
  • Commercial Analytics
  • community
  • Condiser this
  • Conservative Party
  • consider
  • Consider this
  • Consultation
  • Creativity
  • dark data
  • data architecture
  • Data governance
  • data hub
  • Data Lake
  • data management
  • Data Mart
  • data mesh
  • data science
  • Data Supply Framework
  • Data Warehouse
  • Data Warehousing
  • deceit
  • deep learning
  • Democracy
  • digital transformation
  • Diplomacy
  • disinformation
  • Dogma
  • Duties
  • DW 3.0
  • ECM
  • Economics
  • EDW
  • England
  • enterprise content management
  • ethics
  • EU
  • Europe
  • European Union
  • Excellence
  • Excerpt
  • Executive
  • Extract
  • Federalism
  • Financial Industry
  • fraud
  • Freedoms
  • Globalisation
  • good start
  • Good Strat
  • Good Strategy
  • Good Strategy Radio
  • goodstart
  • goodstartegy
  • goodstrat
  • goostart
  • governance
  • hadoop
  • hdfs
  • HR
  • humour
  • India
  • influencers
  • informatio Supply Framework
  • information
  • Information Management
  • Information Supply Frameowrk
  • Information Supply Framework
  • Infotrends
  • Inmon
  • instruments
  • IoT
  • IT Circus
  • IT fraud
  • IT strategy
  • IT World
  • iterations
  • java
  • Knowledge
  • knowledge management
  • Labour Party
  • leadership
  • Leadership 7s
  • life
  • listening
  • literature
  • LSE
  • machine learning
  • Management
  • market forces
  • Marketing
  • Marty does
  • Martyn does
  • Martyn Jones
  • Martyn Richard Jones
  • media
  • Memory lane
  • Methodology
  • nationalism
  • nine competitive forces
  • no limits
  • Northern Ireland
  • obituary
  • Obligations
  • offshore
  • Offshoring
  • operational
  • Outsourcing
  • Oxford
  • pain
  • Parliament
  • Peeves
  • Personal Integrity Key
  • Philosophy
  • pig data
  • PIK
  • PIR
  • Plaid Cymru
  • Planning
  • poem
  • poems
  • Poetry
  • Polemic
  • political science
  • Politics
  • pomo
  • postmodern
  • POTUS
  • Process
  • Professional Networking
  • professionalism
  • project management
  • Project to Excel
  • prose
  • public
  • Public Integrity Record
  • Quiz
  • Rant
  • Referendum
  • Remain
  • RIghts
  • Risk
  • Rivalry
  • Russia
  • Ruth Davidson
  • Sales
  • satire
  • Scotland
  • Scottish National Party
  • scrum
  • sentiment analysis
  • SMILES
  • Snippet
  • SNP
  • Social
  • Social Media
  • Sociology
  • spoof
  • statistics
  • Stories
  • Strategy
  • structured intellectual capital
  • supply chain management
  • tactics
  • Tax avoidance
  • Tax evasion
  • TEAM
  • technology
  • The Amazing Big Data Challenge
  • The Big Data Contrarians
  • The Greens
  • The Guardian
  • The hidden wealth of nations
  • Trade
  • UK
  • Uncategorized
  • United Kingdom
  • USA
  • Value
  • Wales
  • wisdom

Blog at WordPress.com.

  • Follow Following
    • GOOD STRATEGY
    • Join 131 other followers
    • Already have a WordPress.com account? Log in now.
    • GOOD STRATEGY
    • Customize
    • Follow Following
    • Sign up
    • Log in
    • Report this content
    • View site in Reader
    • Manage subscriptions
    • Collapse this bar
Privacy & Cookies: This site uses cookies. By continuing to use this website, you agree to their use.
To find out more, including how to control cookies, see here: Cookie Policy