SteveStreeting.com

Another week, another plan to stimulate the economy from the UK government. I actually think what they’re doing this week is pretty sensible, which basically means an insurance / underwriting scheme dependent on mandated lending to individuals and small businesses. But I think today is actually less about this individual step, and more about the fact that most commentators are in agreement that if this doesn’t work, ie doesn’t restart the flow of credit to sound lenders, then it’s going to lead to pretty much a wholesale nationalisation of the banking sector in the UK.

It’s happening piecemeal already of course, in almost every country in the world – Ireland had the latest case in the Anglo Irish Bank – as each bank fails, it gets bought up by the state to prevent the ripples it causes becoming tidal waves. But what we appear to be talking about now, if this latest initiative fails, is a major policy shift away from the concept that institutions as important as banks should be allowed to entirely run their own affairs.

That doesn’t mean Whitehall beuraucrats directly controlling operations of course, but major shareholders and board members do set the tone for how a company operates. I think it would mean a complete shift in the way banking is perceived (even more so than now) – in the last decade or so, certain elements of the banking sector seem to have been suffering from the ‘Hello magazine effect’ – i.e. focussing entirely on chasing the high life rather than on the fundamentals of their profession. Sure, it’s led to the sector becoming sexy and glamourous, made a lot of people a disproportionate amount of money – at the expense of, oh, just the entire world economy. Shame that.

If full nationalisation happens, and it means that banking becomes suddenly less sexy and attractive to graduates looking for the quickest way to their first Ferrari, I won’t shed a tear. The whole industry badly needed a reality check, and if it takes nationalisation to make it happen, so be it. I do think, however, that all those who received huge bonuses in the last 10 years for doing what amounts to selling snake oil, should be bankrolling the recovery schemes, not the general public. But we know that’s never going to happen – the fat cats stay fat, and the general public gets to pick up the tab for their excesses. Again.

It’s been clear for some time that the US is becoming more and more paranoid about border security. My first trip to the US was in late 1993, when we hopped over to New York on a special deal (less than 2 weeks notice), and I remember it being much like any other international destination, or if anything easier. In particular if you held a British passport, you were pretty much waved through at the border with very little fuss.

Since 2001 things have gotten more difficult, obviously, but in the last 5 years it’s been getting increasingly silly. The need to fingerprint every traveller seems rather unnecessary and certainly slows down the process. On arriving in LA a couple of months ago I was struck by just how unfriendly the officials were, one in particular being pretty damn rude to a family in front of me in the queue who were unsure about which of the multitude of forms they were supposed to fill out when. Sure, it’s really big and clever to swank around with a gun at your hip, shouting at people when they don’t fill in your forms correctly. It’s not universal – recent trips to San Francisco and Boston have been a little more relaxed, but I can’t help but notice that the tension towards ‘outsiders’ appears to still be increasing.

Every time I’ve gone to the US I’ve travelled under the Visa Waiver Programme, which is very convenient – basically you don’t have to apply for a visa if you’re just visiting on business or pleasure, just turn up with your passport, a local address and a return ticket and you’ll be fine. From January 12th next year though, they’ve decided that’s far too easy, and travellers from countries that are eligible for the VWP will have to apply for clearance before travelling, via the Electronic System for Travel Authorization (ESTA). The system appears to be largely automated, so it’s much quicker than getting a ‘real’ visa, but it’s still an extra step to remember to do, and another bureaucratic process that can get screwed up.

I’m not sure why they’ve chosen to do this, I can only assume it’s related to their wish to do pre-checks on travellers, and that they’re not getting ‘enough’ information from airlines – who already have to pre-warn the US authorities of the personal information of incoming travellers (unlike every other country) and give them information which is probably contrary to many local Data Protection laws.

I know 9/11 was a big deal, but honestly I don’t think there’s a need for border control to be quite so unfriendly as it seems to be getting in the US. It’s akin to DRM – hugely overcomplicated processes that mainly put barriers in the way of the kind of people you want to welcome, while almost certainly not impeding the real criminals / terrorists in any proportionate, practical way. Maybe once the current swaggering, fear-mongering chimp of a president is finally gone, the culture of xenophobia and paranoia may start to abate a little.

User generated content is currently something of a media darling in the game industry. Of course, it’s actually nothing new – gamers on open platforms like PC and the home computers before it have been creating mods and new content for their games for a couple of decades now. What’s different now with the advent of yet another acronym to remember (UGC) is that the concept has finally come to the home consoles, those friendly ‘turn on and play’ devices.

On paper, it sounds great – finally, people using consumer-friendly boxes can be creative without having to hunt down FAQs on the internet and learn how to tame often esoteric toolsets (although many people, me included, find this part of the fun of course). All the tools you need are presented in the box, together with a way to distribute them to your friends and the wider internet. But, as ever, the downside is related to the fiefdoms of control the consoles always operate within.

Guitar Hero : World Tour and Little Big Planet are the two most recognised sources of console UGC right now, and both are subject to many media reports of users’ carefully crafted content being deleted by moderators, due to copyright concerns. Any cover of a commercial song, or even a game tune, is summarily removed from GH:WT (as was widely predicted), and now levels which are in homage of titles like Mario are getting removed from Little Big Planet too. It’s perfectly understandable of course; the companies running the servers on which the content sits cannot afford to be sued over it, so are taking the cautious route and pre-empting any problems. But it also shows that centrally controlling content is capable of stunting the otherwise grand promise of user generated content.

The Internet is as successful as it is because control is distributed. For better or worse, you can find publish pretty much anything, and that makes it what it is – a sea of dubious quality data from which search indexes, linking and recommendations turn into a usable, ever mutating wonderland. UGC has this potential in the gaming space, but it can never fully realise it while content is regulated at a central source. It’s similar to the way fanfic and fanart are always popular, but organised publishers of it get sued these days, so the place to really find it is on smaller, distributed fan sites, not central corporate ones. Console UGC is certainly good fun, and better than no UGC at all, but the fact that it may only be published in one place means Big Brother is always controlling what can and cannot be published, and that is the antithesis of the principle of personal creativity. Creativity wants to be free, not penned in by what a central source says it can and cannot express; if I want to create a LBP level where Link and Mario belch a cover version of Bohemian Rhapsody, I damn well should be able to. But, that won’t happen in the control-obsessed world of the console any time soon I’m sure.

I generally don’t stay up late into the night to watch things live, such as Formula 1 or the Oscars. However, I did stay up until almost 3am this morning watching the US election results come in, only going to bed when Ohio declared for Obama, pretty much guaranteeing he was going to win (it’s a crucial swing state) – at the same time unofficial predictions were that Florida and New Mexico were going his way too, making it pretty much unassailable. Of course in the end, Obama won by 349 electoral college votes to McCain’s 162, which makes it officially a landslide.

I’m tired as hell, but happy. I wasn’t around when JFK was elected (or when he was assassinated), or when Dr King made his speech (or when he was assassinated too – let’s hope this isn’t a pattern), but I feel I have just witnessed an important moment in US history which ranks alongside, and perhaps even above those seminal moments.

I’ve never had any desire to live in America but just for this one moment, I envy those who do. There are tough times ahead for sure, but the majority who voted for this change deserve to enjoy this moment.

Please don’t inflict another 4 years of clueless right-wing government on yourselves and the rest of the world.

McCain might seem like a change from Bush, but have you noticed how much his previously independent rhethoric has changed since becoming the republican nominee? He’s towing the establishment line more and more, and becoming more of a negative compaigner by the day. And anyone who picks Sarah Palin as a running mate needs their head examined.

If the best line he has is to pull out the old “my opponent is a socialist” rhetoric then it shows the desperation in the republican camp. I know America is staunchly capitalist and more right-wing than Europe, even Britain, but if you hold the ‘American Dream’ as your benchmark, you need to recognise that a land of opportunity does not truly exist if the odds are already stacked in the favour of those belonging to favourable socio-ecomonic groups. If the lion’s share of opportunities are only accessible to those who start high enough up the ladder to afford a good education and standard of living from day 1, it’s not opportunity, it’s a class system by proxy – one only a fortunate few will break out of. McCain talks about wealth creation, but seems to ignore that the best way to create the most wealth is to give everyone the best chance of raising themselves up to a good standard of living, not just a select few, and that requires social investment – tax cuts for those who have already ‘made it’ do not create anywhere near as much wealth overall. But that’s not what people in the top 2% earnings threshold want to hear of course, which increasingly seems to be the group the republicans are representing.

It’s your choice, I hope for all our sakes you make it wisely.

I generally don’t have a lot of time for politicians. I’m of the opinion that a large number of those who actively pursue political power are also the ones least suitable to wield it, and that even the few that enter the halls of power with the best of ideals will have most of them eroded away within a few years, or be largely marginalised.

I live in a jurisdiction which has leaned towards a conservative approach to government for decades (our island has it’s own government, separate from the UK). Early on in life I just kind of assumed political conservatism was a normal, sensible approach that was probably for the best – after all I grew up during the Thatcher years. However, as I’ve matured and gained more life experience, I’ve become more liberal in my views and have come to realise that I disagree fundamentally with many aspects of traditional, right-wing conservatism. I’m far from a militant, banner-waving leftie, but I definitely have a greater sense of my own political opinion, rather than taking what other supposedly ‘knowledgeable’ people say on face value, and whilst I consider myself mostly in the centre ground, if I lean anywhere at all it’s slightly to the left.

I’ve talked about the banking crisis a little on this blog already, but this week it very much came home to roost in our little rock when Landsbanki Guernsey was taken into administration, a victim of the general meltdown in Icelandic financial affairs. I don’t have any money in Landsbanki thank goodness, but a lot of ordinary local people did, as well as many ex-pats. Now, banks are failing in other places too, but for the most part ordinary personal depositors have been protected in those circumstances, either through ad-hoc political guarantees (Ireland led the way here), or existing depositor protection schemes.  However, Guernsey has no depositors protection scheme, and no ability to make an ad-hoc guarantee since despite the huge amounts of money sloshing about in trust funds here, next to none of it generates tax revenue (only local people pay tax), which means that at least in theory, personal depositors stand to lose every penny of their life savings. These aren’t millionnaires, for the most part they’re ordinary people who have worked really hard for their nest egg. Now, they almost certainly won’t lose everything (although it’s very unlikely that they’ll get it all back I think) but the point is that they have absolutely no idea what to expect – the most they’ve had is wishy-washy attempts at calming their nerves from some politicians that frankly are worth less than the newspaper they’re printed in.

The fact is that uncertainty is to a large part responsible for the current financial mess, and a lack of a depositor protection scheme just adds to that. It’s incredible to think we’re one of the few places in the world not to have one of these schemes, despite supposedly being a ‘respected financial centre’ – the idea has been floated in the past, particularly after such collapses as Barnett Christie and BCCI in the 70s and 80s, but in the end nothing happened; the reason being that the banks didn’t much feel like setting up such a scheme, since it obviously has a cost implication for them. Our government, which has become utterly dependent on the financial industry, ultimately didn’t want to rock the boat and quietly let the issue drop. Their excuse for such negligence has been that ‘no-one could have predicted this crisis’ which even if we ignore the precedents already set by other collapsing banking institutions, is frankly entirely missing the point; it’s like saying that you’re not at fault for not taking out house insurance, because you couldn’t have predicted your house would catch fire. It’s drivel. The simple fact is they didn’t want to upset their industry backers, and just hoped that it wouldn’t happen again, despite historical evidence to suggest such things were an inevitability as cycles come and go.

Our government has for years now bowed to pretty much whatever the financial services industry wanted, in order to keep them happy. While the stance is completely understandable to a degree, some people (myself included) believe it’s been taken too far in recent years. A case in point is that our entire taxation system was changed this year solely in order to satisfy the needs of this sector; an enormous, costly and disruptive task which also now places the taxation system on a footing that requires considerable year-on-year local growth to avoid having to raise additional taxes from the common man. This was always a dubious gamble given that, as an island, we’re limited by land and population – clearly many members of financial sector lobbying groups couldn’t give a damn about whether they caused even more overpopulation and relative poverty problems, so long as they can keep the money rolling in. But now, with a protracted recession looking likely, these already rather optimistic growth targets look impossible, and that will ultimately require a ‘rethink’ – which is political speak for finding ways to raise more tax from everyday residents (since non-residents pay no tax no matter how much money they make through investments here).

Personally, I say it’s time to re-evaluate our priorities. Government is elected by regular people, and this is who they need to answer to first, not to lobby groups from particular industries. There have been years of decision making based on the premise that by keeping the rich (sorry, ‘high net worth individuals’) happy, the rest of the population will benefit from the trickle-down effect. That’s certainly true up to a point, but there is always a delicate balance to be maintained to avoid going from making sensible trade-offs for mutual benefit, to allowing bare-faced exploitation, and in my opinion at some point in the last few years we tipped over it. There seem to be a few politicians in our government that see this, but they are so far in the minority. Maybe when others have to face down members of the electorate who have lost their savings because of a decision that was made in the interests of industry rather than the people who gave them their jobs, it will start to finally dawn on them.

Thanks John for the reminder to investigate S3 as a business media hosting service, it works like a charm!

Now that I have far fewer bandwidth worries (max $0.17 per GB), the Torus Knot site includes a nifty dynamic selector so you can pick low, medium or high quality – the latter is at a higher resolution too, clocking in at about 100Mb. I may well use S3 for future public commercial downloads in the future too. It’s altogether more convenient than the block bandwidth allocations you get with regular hosting packages, since it scales dynamically at a very fine level of detail depending on demand. And don’t be fooled by ‘unlimited’ bandwidth offers, all hosting companies have to pay for bandwidth and there’s no such thing as ‘unlimited’ resources; you’ll actually find your bandwidth being throttled or cut off via a ‘reasonable use’ clause in the small-print; ‘unlimited’ is simply a marketing lure. If you want truly scalable guaranteed bandwidth, you have to pay for it.

Getting S3 media hosting working wasn’t that hard, but did require a few discrete steps. Firstly, you need to create a bucket in your S3 account which is all in lower case, is globally unique and is DNS-compatible; so for example I created a bucket called ‘media.torusknot.com’.

Then to make it all look nice you need to create a DNS CNAME entry to map a sub-domain of your site to that S3 bucket; in my case I mapped ‘media.torusknot.com’ to ‘media.torusknot.com.s3.amazonaws.com’. That allows me to access any files I upload to that S3 bucket via ‘http://media.torusknot.com/somefile.jpg’. You do just need to set the ACLs on the files & the bucket to make sure public access is allowed.

Finally, if you want to stream video files via a Flash player from S3 to another domain, you also have to tell Flash that it’s ok for the content to be pulled in from a different domain. Create a file called ‘crossdomain.xml’ in the bucket, with these contents:

<cross-domain-policy>
<site-control permitted-cross-domain-policies="all"/>
</cross>

That allows the media to be accessed from anywhere – you can be more specific if you want but this is the simplest approach.

Once again I’m using the excellent FlowPlayer; my only issue with it is that the ‘buffering’ animation seems to not work all the time (so be patient if you’re viewing the high quality version).

Gotta love this cloud computing business

I blogged a few months ago about my concern regarding the precedents being set by the Northern Rock and Bear Stearns debacles – that investment bankers and city executives can take outrageous risks, bag huge bonuses and get into a situation that for the sake of the economy, the government has to step in and sort it out.

If only that had been the end of it; I don’t think anyone really thought it was, but since then things have really gone south. In the USA we’ve had the state effectively re-nationalising Fanny Mae and Freddy Mac, and they’re now debating a $700bn rescue package to buy bad assets from a host of financial institutions in order to ‘extract the poison’ from the markets.

Now, as before I completely understand that, in the immediate aftermath of a train-wreck such as this, you have to concentrate on damage limitation and short-term recovery. That doesn’t mean, however, that we should stop asking searching questions – the world has been placed in a woeful position thanks to a comparatively small group of people who benefitted from continuously feeding the insatiable credit monster, no matter what the realistic repayment prospects were for those debts. It’s typical commission-based salesman behaviour – close the sale, let the accounts department worry about the rest.

I’m glad to see that the US congress haven’t just rubber-stamped the rescue bill, and are asking serious questions about future guidance & regulation on the market and its operators. The Wall Street guys will tell you that interference and regulation just inhibit the market and make everything worse, but I believe that recent events rubbish that claim; if the market was truly self-sufficient and self-regulating, it wouldn’t have gotten itself into the position where it needed a handout from regular people’s tax dollars to avert a total meltdown. Clearly short-term greed overwhelmed good sense, and those in this market acted like children who didn’t know when to stop eating junk food – except in this case, everyone ends up with a stomachache. Like children, if they can’t figure out for themselves how to behave, then they need a responsible adult to make those decisions for them. Trust is earned, and the financial sector essentially frittered all that trust away having a giant party, and there must be consequences.

Some people will blame the culture of credit and say that the market was just responding to that, and so it shouldn’t be held entirely accountable, and I say hogwash. Sure you can blame the people who took out loans they couldn’t afford to a degree, but come on – these were unlikely to be financially savvy people, and at the end of the day it’s up to the lender to evaluate repayment prospects rationally. After all, if they don’t get their money back, they’ll go out of business. In this case though, the financial wizards concocted another one of their ‘vehicles’ which magically allowed dubious debt to be repackaged and resold, effectively becoming somebody elses problem. What a marvellous invention! We can take all the risks we want, collect our fat bonuses and just keep hiding all our crap under a giant rug in the spare room. No-one will ever find it, right?

This is not responsible behaviour, it’s reprehensible. The vast majority of regular people work hard, are prudent with their money, think hard about lending or borrowing money, and don’t make the kinds of basic affordability errors these so-called financial experts were making. After all, regular people have to live with the results of their actions, so prudence is a wise stance. Mistakes in the financial sector, however, result in damage mostly to the lower echelons of their workforce, crippling problems for the rest of the public, desperate measures from government; yet the execs still get to keep their huge bonuses earned during the previous years.

After all the mess is cleaned up, I hope those that benefitted from the years leading up to this situation are held to account. Enron, Nick Leeson – they were nothing compared to this. The culture in the upper echelons of corporate banking is clearly fundamentally broken, and both governments and the industry owe it to regular people to resolve it, not just with short-term bail-outs, but with fundamental change. Something is badly wrong in the financial sector, and they’ve proven themselves incapable or unwilling to sort it out before it resulted in pain for everyone else. Because of that, they’ve forfeited their right to decide what happens next – behave like a greedy child, and you deserve to be treated like one.

I just watched the Little Big Planet beta video that VG247 posted, and I have to say well done to Media Molecule for creating a game with a definite British feel to it (as well as it still looking damn interesting). I complained a while back about the overt Americanisation in so much of the output of British studios in recent years, losing a lot of the regional quirkiness that I think enhances content from any country, so I’m glad to see the spirit is not dead. In particular I liked the use of the ‘gallery’ music from Take Hart, which is hugely appropriate. Great way to get the credits actually watched too. LBP remains the one exclusive that piques my interest on PS3 and I’m looking forward to having a play with it on a friends machine.

I’ve read that Fable 2 has a definite British slant to it too, I’m looking forward to seeing how that turns out next month.

One of the problems with doing most of your business internationally is that you’re at the mercy of currency exchange rates, with the ever-present possibility of losing money just because the market changed. In the last couple of years the Pound has steadily got stronger against the Dollar, meaning it’s not a case of whether I lose, but rather how much. It has also meant that for new work I either have to stick to my Pound rates and risk being less competitive, or just accept a lower & ever-depreciating Dollar rate in order to secure the work.

Over the last month though, things have suddenly changed. The UK housing market is in free-fall, and most recently the Chancellor gave a rather unexpectedly candid interview in which he basically admitted that the UK economy is up a certain creek without a certain paddling device. Nice of him to be honest about it, but the markets aren’t used to such lack of spin and reacted quite badly (being as they are twitchy, caffeine-overdosed sheep suffering from chronic panic attacks) – and promptly leaped off a metaphorical cliff, as did the exchange rate. Perhaps the Chancellor’s honesty is attributable to those eyebrows – I’m guessing they make bluffing considerably more difficult

Lots of people are now lamenting on the news & talk panels about how this will affect the price of imports, but there’s never a shortage of people to go on these programs declaring that we’re all doomed and we might as well throw ourselves under the next passing bus. Personally I find it rather ridiculous because these are the same people that were lamenting when the rate went up in the first place, because it would cripple all the exporters in Britain (and we might as well throw ourselv….you get the idea).

Personally, I’m glad – the Pound/Dollar rate has finally returned to about what it was when I went into full-time business in 2006 ($1.77 ish), having dropped over 10% in a month. I wouldn’t mind if it dropped a bit lower – I was quite happy when it was about 1.6 personally. Sure I’ll pay more if I buy something from the States, but far more money comes in my direction from there than the other way around.

So, to the Chancellor: thank you, Darling!