Trading Life

2008-07-15T13:53:00.000-07:00

Mark Twain said that “History does not repeat, but it rhymes” and I agree, if you take a look at the current mobile phone market and then you review some business history, you will see a lot of similarities.

You do not have to go far, the first one that comes to mind is the Personal Computer war, of the 70s and 80s, where you could find several dozens of companies fighting for a place in the market, now only a handful are still alive, but just to name a few of the defunct ones: Commodore, TRS, Spectrum, Atari, MITS (Altair), etc.

The same happened when the TV appeared several dozens of companies tried to seize the market, but only a few were successful and if you go to the 20s, you will find the same example with the automobile industry.

Well, we are experiencing the same thing with the mobile phones manufactures, there are dozens of companies trying to grab a percentage of market share and I believe that just a few will remain alive after 5 years (either because they will go broke, be acquired by other company or they will confined to just an small niche)

Can you pick some winners?

I will take a guess:

Nokia: we can say that they invent the mobile phone as a fashion accessory and they have been able to reinvent themselves several times, they are like the Fenix, they are highly innovative, if they do not lose their focus and they do not get too big (= bureaucratic ). They also have a whole country behind them and that it is not small potatoes.

HTC: I am taking a big gamble here, because they are currently small, but they have a track for producing innovative phones and they only concentrate in what they do right: Phone manufacturing , leaving the OS to others (windows or the coming android (Google) for example). They have the focus that you need to have to survive a war.

Apple: the previous one was a gamble, this one is easy, Apple will be the BMW/Audi of the mobile phones, the consumer not only will love its phones because they are simple to use and beautiful but because they give you status.

Samsung or LG: one of these South Korean company will survive (my pick is Samsung), they have been improving model after model and they probed that have the rare (and valuable) ability to know when is the right time to copy and when to be creative .

Those will be the titans; of course there will be some niche players, like in any industry.

There are 3 manufactures that are now titans go are going to have big problems in the future if they do not change quickly:

Motorola: I will start with the obvious one, I believe that the time has already passed and they are destined to be the Zenith of the mobile handset industry, I believe that there is not return here, not because they cannot recover (they have great engineers and several distribution agreements that some companies will kill for) but they are going to be either be purchased soon or despair, because even its shareholders have given up.

Blackberry: it has a huge fan base and addicts, but I believe that its OS is simple, too simple, the ones who love their BBs, love it because they have never tested another Smartphone in their lives (iPhone or even one HTC with WM6.1), once they try one, they will feel like the guy who marries the only girl in town and he thinks all his life that she is beautiful, only because he can only compares her with other guys, until one day he decides to go to the big city where he finds out that his beautiful wife is not only uglier than the city girls, she is even uglier than the city boys too!.

BB needs to improves a lot its OS, the internet navigators remains me the Gopher service when I first discover the internet before Netscape in 1993 (man: I love my Gopher navigation during that time, at that time I thought that nothing would beat it)

BB knows all this, and this is why they have been working in a 3G version plus a touch screen device, the success of this coming device, for me, it will determine its future success, but I see it a kind of difficult, based on my experience, BB should focus in the hardware and leave the software for other companies, they used to have an outstanding software but now it is kind of outdated.

It specially hurts me this because I will love to see BB success, I had a good time when I visited its HQ in Waterloo, CA I got to know a few nice guys there too.

I believe that if BB does not succeed, it will not completely despair, but they will be continued living within a small niche (providing handsets to big corporations or Governments who like to give its employees with email access under a super highly secure way).

Sony-Ericsson: It needs to avoid a problem that Charles Munger mentions time after time: “for a man with just a hammer everything looks like a nail” and it is the problem that condemned Motorola, when you have one outstanding idea you just try to apply it to everything; think first about the Razr and how Motorola tried to make every phone after the Razr like a sibling and now think about the Sony Ericcson’s Walkman phone and know you have what I was trying to explain you.

The rest: UTStarcom, Kyocera, Pantech , Sanyo, Huawei, Sagem, etc. I considers that only a Chinese manufacturer can have a shot if they really want to, but definitively it will not be Huawei, because they do not have a focus on the business and for my own experience when they have tried to do something aimed to the consumers market, the result has been quite awful, but they certainly have the power, decision and the ability to improve quickly so I will not be surprised to see them being part of the successful ones.

Apple iPhone

2008-05-02T14:07:00.000-07:00

A few months before Apple launched its iPhone device, I wrote about which I believed was the most effective way for Apple to sell its upcoming phone.

At that time I chose the direct approach (directly to the customers without locking the phone in any network), selling without using any of the “wireless orifices” (AKA = wireless carriers according to S. Jobs) as a partner and obviously without offering MVNO service.

Apple chose to distribute its phone partnering with a carrier (AT&T Mobility in USA, DT in Germany, O2 in UK, etc.), but if you look at the selling figures and compare about the iphones sold versus the iphones activations, you will notice that the customers have chosen the direct approach.

When Apple made the decision to go with AT&T, first it was looking for a big distribution network and second it was looking for a revenue sharing agreement, like the one that Blackberry has been having with wireless carriers for years, which can add a nice extra cash flow.

The problem with that strategy it is that it did not work, locking the iPhone in a certain network and make the customers to pay extra monthly payments, actually has left money in the table that Apple could easily take it.

There is an estimation that says that ATT is paying to Apple $18 per user per month in a 2 year contract, that brings the “ideal” present value to $382 (this is money that Apple is going to receive in addition to what the customer pays when he purchases the phone).

But there are some flaws in this business model, usually the people who purchase iPhones are the ones who like to have a state of the art mobile, what makes you think that they will keep his slow first generation iPhone, when the second generation arrives this September or sooner.

I have also just read that ATT is planning to start subsidizing the iPhone, which is a great news in the short term for Apple, but it is a very bad news in the medium term, because it will make the iPhone much less desirable, think about Motorola and the Razor, at some point it seemed that everybody had one and believe me, in fashion, like in the investment world, when everybody seems to have something is time to drop it and look for the next hot thing.

When they realized there will be a big portion of the iPhone customers who have signed an agreement with ATT who are not going to finish the contract and they will be out of it, either paying the penalty fee, or via an upgrade (usually you can do it a year after you signed the first 2 year agreement).

At the end, I consider that Apple would have done much better, selling more units, reaching the 10MM mark sooner going alone and even it will be able to charge around $200 more for the phone, because it would have been unlocked and happily customers will still be making lines (not just in a few countries but in the whole wolrd) to purchase one

Reflexiones sobre el partido Independiente – Chicago

2007-04-25T07:34:00.000-07:00

En el campo habia un caballo que alguien habia bautizado Tapalque, en unas de las tantas tardes en que nos sentabamos con mi tio abuelo debajo de un arbol a hablar o simplemente a escuchar el cantar de los pajaros, le pregunte: quien era Tapalque a lo que el me contesto: “era un cacique indio, etc,etc.”, realmente debo confesar que no recuerdo si es que no preste mas atencion a lo que siguio despues de la palabra “indio” o si la memoria solo me ha permitido guardar lo que es esencial para la historia que les estoy narrando.

Al escuchar las primeras cuatro palabras de su respuesta, senti que mi corazon latia mas fuerte y mis ojos se ponian mas brillosos mirando a aquel caballo negro, al que vamos a calificar como azabache, no porque lo haya sido, sino solo a manera de homenaje, como aquel que recuerda a su perro callejero de toda la vida como un boxer, dalmata o lassie simplemente para hacer mas elegante su pasado.

Es que en mis 6 o 7 anos, crei que aquel Tapalque en el cual paseaba en algunas de las tantas mananas habia sido realmente un cacique y que por una magica razon, no me importaba el como, se habia transformado en caballo; no estoy seguro si esto fue la causa que disparo mi interes por consumir leyendas indias que me invadio por un par de anos o si un poco antes de aquella conversacion las habia descubierto y ellas ya habian preparado mi imaginacion.

En definitiva creo que tarde uno o dos veranos mas, ya Enrique no nos acompanaba, en darme cuenta que habia maleinterpretado su respuesta.

Por que volvio todo esto a mi mente?, porque viendo el partido de independiente hoy por la noche, imagine que Mateo me preguntaba quien era Santoro y yo le contestaba:”Era una perro negro que durante la primera Colina en Gesell, el Gallego lo bautizo y lo adopto como mascota” y sin querer desataba su imaginacion como Enrique la desato conmigo hace casi ya 30 anos atras.

Why a Soaring Real Estate market is not good for the regular guy?

2007-04-21T19:48:00.000-07:00

A regular guy is one who do not purchase its home as an investment, he purchases it to live in with its family and in this case, definitively, a raising house prices environment is not good for him despite what the newspapers, TV, Realtors, Politicians would like you to believe.

If you buy your house just to live in it and I ask you: will be beneficial for you that it increases in a big deal (>1% per year) its real (=after inflation) value along time?, probably you will say: Of course it will be…well, I can tell you that you are absolutely wrong, because:

A) Raising prices above inflation means that you will have to pay higher property taxes in the future

B) You will have to pay higher insurance costs as well, because now it is more expensive to replace your home

C) Probably you will have to live in that house forever or move to an smaller house in the future, but for sure you will not be able to afford a bigger house (think this, now your house value is $200,000 and you paid $100,000 two years ago, so it’s great, isn’t it?, not really because the bigger house that used to cost $200,000, now it costs: $400,000, the only way to afford it, it’s to go deeper into debt.

D) Other collateral problem, is that if you are not down-to-earth enough, you will probably think that you are richer just because the house, in which you are living, is more expensive, so as you feel richer you will spend like a rich guy, in other words your debt will increase and if you blind enough the only way to out of it will be to sell your home, at the end, in a raising prices environment, you have a Jaguar and a PS3, but you do not have your home anymore.

So, for whom is good a raising home prices market?, well, let me tell you a few:

A) Politicians and Government, the taxes that they receive are higher, thanks to raising property taxes, that it is not bad for the common guy, if the extra money is spend in education and health, but this is not usually the case, at least in Florida.

B) Realtors: obviously, a week ago the WSJ published an article saying that the Realtor Association is going to spend a lot of money just to make us believe that the bubble is still on.

C) Home Depot, Construction companies, etc, etc.

D) Lenders: Banks, mortgages companies, etc.

E) Investors: I am talking about real investors, not your greedy friend, the one that purchased a couple of condos that now he cannot sell, I am talking the ones that around a year ago left the market and now they are investing in something else.

From this, you should not follow that since raising prices is bad for you, a market of prices decreasing should be good: depression is as bad as a bubble for you, but in this case most of the guys that are winners in a boom, are losers like you, so they will be in your side and this means that you, at least, will be good informed about the situation and your real alternatives.

Something is Rotten in eBay

2007-04-10T11:40:00.000-07:00

About a year ago, I did a valuation analysis in eBay and I concluded that it would worth to purchase the stock at $21 (including a margin of safety), a year has passed and after some experiences that I had with eBay during last month, I really doubt that now it would be a good investment to purchase the stock at that price (currently it trades at around $34).

I have been a long time member of eBay, not a heavy user at all, I only make 2 or 3 operations (buy/sell) every year, but I have been a member since around 2001.

Last month I had to move and I decided that it was a good opportunity to increase my average of yearly operations selling some small stuff in eBay (it ranged from a coffee maker, baby formula checks and cans, small furniture to some electronics) to my surprise only the formula checks and cans where well received while the other items not only did not receive any bid, but I even received spam emails (yes!: SPAM, e.g.: a company offering money in exchange for gold that I would be able to collect in an online game).

Even in one of the hot items, I received emails from people asking me to stop the auction and sell them the checks for a discount in order to cheat other members and eBay (of course I refused)

It also worth mentioning that all the items were auctioned without reserve price and with a starting price of $0.01 with a real cost of shipping.

After this, I first blamed the items that I was offering, but I decided to give them a second chance offering them in Craigslist, it was my first time there, but for my surprise all the items but one were sold in less than a week at a good price, in cash (the money was not kept prisoner in Paypal jail) and totally free of charges.

One thing that I found out that eBay is doing great, it is a great place to find deals about stolen products, there you can find fire sales of new products, I believe that the police or the justice should be doing something about it soon, because obviously is illegal and only entices robbery, because thief selling them in eBay can get better returns in their stolen goods that selling them in the street.

I think that this kind of experience it something that it is not happening just to me, I am pretty sure that other members are sharing this same kind of experience, but this is not all, because I will also share with you an investment tip, Warren Buffett says among other things that you should invest in companies with a sound management team, but it is not easy for a small investor to know that, I found out that a good proxy of a sound management team is how good its customer service is and how accessible and open to new ideas is the upper management (you can try sending a letter or fax to them and you will be surprised how easily is to receive a reply from them, obviously you have to send something interesting in order to receive a reply).

Well, with eBay my experience regarding this, it was not good, I sent around 2 years ago, to almost every Senior Manager in the marketing department a couple of letters explaining a idea that I had, about a new market that they can easily add in its portfolio without any or with little investment and that it would increase very quickly its revenues in several dozens of millions, but to my surprise not one of them reply, not even saying: “thank you for your letter and time…blah,blah, but your idea is very stupid,blah, blah”).

Talking about Warren Buffett, I would like to tell you that I am planning to attend for the first time to the Berkshire Annual Meeting in Omaha, NE next month and I am thinking of blogging about it, I know that you can probably read about it everywhere (from The Economist, passing by the WSJ to the Motley fool),but here you will be able to read it with a fresh, unbiased and original twist

How the business model of the companies who offer Free International Calls work?

2007-01-12T12:46:00.000-08:00

As you may know there are a lot of companies offering free international calls, in order to get them you only have to dial an access number located in Iowa, just to name a few: Futurephone, Ophone, AllFreeCalls, etc.

Some people are trying to figure out how the business model works and it is quite simple, let me tell you how:

Every time a telephone company completes a call and terminate it in a user which belongs to another company it should pay an access or termination charge (this happens in USA and in every other country around the world).

For example, when you dial a call from your AT&T mobile (formerly Cingular, formerly AT&T Wireless, formerly...) which terminates in a Verizon fixed customer located in New York, AT&T has to paid a per minute charge to Verizon in order to get access to its customer, in this particular case, because the customer is located in New York or in any other highly populated area these charges are around $0.003 or even lower.

But, when the call is terminated in a less populated or rural area, the termination charge is it much more higher (ex: $0.05 or $0.06), usually in these regions the companies that operate are not big corporations (like AT&T or Verizon) and the extra income that they receive it help them to cover the higher cost to terminate a call in a middle of nowhere farm.

The same happens internationally, for example when a Verizon's customer makes a call to UK, Verizon should pay directly or indirectly to British Telecom a termination charge.

So that it is all you need to know: the small company is receiving, let's say, $0.05 per minute from Cingular (remember: Cingular is paying to the small company to terminate the call that you generated in your mobile phone calling to the number +712.XXX.XXXX) and then it has to pay to the foreign telecom company a per minute termination charge that for example for the following countries is more or less:

Argentina (offered cities): $0.007
Hong Kong Mobile: $0.0042
Europe Fixed (Spain, Italy, France, Germany, Norway, Netherlands, Austria, etc.): $0.010
Brazil Rio / Sao Paulo: $0.0110
Russia Moscow and SP: $0.007
South Korea / Taiwan: $0.0120
UK: $0.008
Singapore: $0.006
China Fixed and Mobile: $0.009
Israel: $0.011

For example for a call to UK they have a gross profit of $0.042 per minute or 84%, which is not bad at all.

I see two weak points in this business plan, which I consider will only provide a short term gain:

A) Fierce Competition: as I said there are a lot of companies offering this kind of service, when only 2 or 3 months ago there was only one (I believe that the first one was Futurephone), this means that each company will not only have a limited market share but they will need to compete offering other destinations which will be more expensive so their gross profit will be hurt, just to name a few of other destinations which can be included:
South Africa: $0.040
Colombia cities: $0.0280
India Hyderabad and Bangalore $0.0450
Jordan $0.0250
Nigeria Lagos $0.0350

(Of course the most expensive destination will never be included, at least as long as Fidel lives (Cuba), because its current cost is $0.80)

B) Cingular, Verizon Wireless and other telecom companies limited patience: how long are they are going to be willing to pay $0.05 to terminate a call which they could be receiving less than that according to your wireless plan?, once they realize of that they will be start implementing caps in their call anywhere in USA at the same cost.

iPhone: What Apple should do

2006-09-29T15:22:00.000-07:00

It is not a secret that Apple is planning to launch its first truly mobile phone (the Rokr and other ventures with Motorola do not count), you can see the amazing design of this new phone in Appleiphone website.

it is also the word in the street that S. Jobs is not sure which path Apple should choose, well here is my little advice: You should go alone without service!! and here it is why:

- Do not go in association with a mobile provider (Cingular, Verizon Wireless, T-Mobile, etc.)
If Apple signs a distribution agreement with one, two or all providers, it will be at their mercy, they will choose how much are going to charge to the customer for the equipment, for how long are going to lock the customer on a contract or when and how are they going to push or not push Apple's phone ahead of Motorola, Nokia or Samsung's phones.
Of course it is the easier solution because the mobile provider will pay Apple a bunch of dollars without too much effort and probably they will have then the risk to sell the product to the customer and bear the loss of selling the phones below cost, but as I mentioned Apple will not have the control of its product and it will have to compete in the same stage with really phone manufacturer monsters like: Nokia and Motorola.

- Do not go pure alone as an MVNO provider

This is definitive the silliest path, nobody is going to subscribe to Apple Wireless just to have a cool phone, it is like Dell or HP would have been thinking about launching an ISP service (imagine: Dell On Line) because they would like to make sure that their customers have an outstanding experience when they use their PCs to access to the Internet.
It is really a hassle for a customer to switch to a new provider and specially to one that it runs in the same network (so it will have the same quality problems) that they currently have.
It is a big risk for Apple because it will have to spend a lot of money in Marketing in order to get new subscribrer and iy will be fighting against really big guys (like Cingular or Verizon Wireless) and, believe me, for what?...there is not margin in the MVNO business (see ESPN Mobile...soon Helio will join Disney venture's destiny), only a couple of guys have been successful in the MVNO business and it is because they have been early in the game with a super easy pricing structure (like Virgin Mobile) or because they have focused in a niche (Hispanics) with a very big distributor (Wal Mart) before anyone else (Tracfone).
So, the MVNO means a lot of risk, a huge investment, a lot of job to do specially for one that do not have experience in the mobile industry for a very low return.

- and here it comes: Go Alone as a hardware provider!

Here it is the right answer!, at the beginning of an industry usually the service provider gives away the hardware or at least sell it heavily subsidized (think about when the internet begun, after Al Gore invented of course, some ISPs providers were giving away PCs, or when the fixed telecommunications started, AT&T gave away regular phones to its subscribers, etc.), but we have evolved from this and the customers have more freedom to choose the products that they like to attach to the network (the times of the $99 wireless for a superb cool phone are near over, my friend, but all it is not sad because you will not longer to be required to marry a cellular provider for 2 years minimum).

Mobile phones have evolved, now they are not just mobile phones, for example they are watches as well (sorry Tag I am not longer use a watch since 2001), they are calculators (I am not longer carry a calculator everytime I go out...yeah!, I know I am a Geek, blame me!), they are music players (I am not longer use my mini Ipod since I purchase the Motorola Rokr last January) and if they were wifi capable I will for sure use my PC a lot less and if they were wifi compatible I will use then to make some international calls using Skype sometimes instead of the dammed prepaid calling card from IDT and if they were compatible with Slingplayer mobile I will watch less my regular TV.

If a mobile phone could do all that I probably would not mind to spend $500 or $600 to purchase one and probably there are a lot of people who are thinking like me (keep in mind that you are spending right now probably $300 for a music player, plus around $150 for a "top of the line" mobile phone which carries a 2 year contract).

If Apple goes alone, they will be able to innovate (think about the wifi capability, how many mobile providers are going to accept to offer a phone with wifi?, they will be afraid that the phone will steal calls make via VoIP or it will cannibalize its data transfer business), so they will be able to offer a better product.

Other benefit it is that Apple will have to sell the phone unlock, which means that you can choose whenever provider you prefer (yeah, I know about CDMA, TDMA, GSM 800/1900, etc,etc. compatibilities, obviously the customer will have to choose which technology use before purchasing the phone), but if for example they choose the Apple GSM they will be able to use it, here in the U.S. with a provider and switch the sim card , to a cheapest provider when they travel to Europe, without any problem)

This path is the best for Apple, since they will concentrate in what they know to do (hardware design) and for customers who will enjoy an outstanding product with many features that they could not even imagine right now, but it is not so good for the mobile providers because they perhaps will loose some services in hands of VoIP, wifi, etc. and probably the churn rate will be higher (because the customers will not be under long term contracts) and these guys are not small potatoes, they have a powerful lobby structure behind them, so I do not so sure how free is Apple to choose the best path, but Steve Jobs, if you are free to choose...you now, know what to do!

2006-08-21T14:11:00.000-07:00

More than a year ago, I wrote about two things:

A) The Real Estate bubble in South Florida and
B) How overrated was Arbinet

I just have common sense, not a sixth sense, but now the Real Estate bubble is loosing its air pretty quickly, condos owners in Miami should be worried, there are signs everywhere of big trouble ahead, even some of the Realtors are saying that some clouds are appearing in the horizon...if you would like to see real signs, just walk by Brickell Ave. during the weekend and you will see lots of "Sale by Owner" and "Open House" signs everywhere.

About Arbinet, what I can tell you it is that they seem desperate, they are launching a new product every month, and as usually happens this new product it is just a new flavor of the same thing..when they realize that the new product does not work, they launch a new one. As a sign we only need a button, Arbinet used to be profitable...not anymore, this last quarter they publish their first loss as a public company...but the bigger storm is the one that will come ahead...you read it here first.

Well, and now I will tell you something new: Miami will become Vice City in a couple of years, this is why:

A) an overinflated Real Estate Bubble is pushing far away low income workers, they are being marginalized (they never have a home, but now because of the bubble they are even more poor and they used to be).
B) Because of this bubble, the mid-income and mid/high-income workers had to move far away from their jobs, this means that now they have a longer commute.
C) Mostly because of the point B, and because our local authorities are very incompetent and they could not see that this will happen, the traffic in Miami horrendous.
D) Everyday people spends hours in their cars in horrible traffic jams worry about how to meet the higher mortgage, insurance, property taxes, etc at the end of this month, as a result they feel angry and very irritable, you can see that everywhere, it is now more easily to find an angry person than a friendly one in Miami.
If you drive around Miami, you will see cars cutting you in the line, speeding around 30 or 40 MPH higher than the speed limit, driving in zigzags, using the horn a lot and any other impolite maneuver that you imagine it can be done behind a wheel....

....It used to be different a couple of years ago....

Unfortunately I do not why the Police is not doing anything about it, perhaps they are not willing to...

E) but all those are minor problems, the bigger one has just started around a month ago...the crime is raising and I am talking not about big bank robberies or Drug Smuggling, I am talking about the kind of crime that can affect a regular citizen, for example a couple of weeks ago, one tourist was murdered in Cocount Grove because of a small robbery, last week a teen girl was killed near Brickell in Little Havana, because they would like to steal her sneakers(!!), yesterday the police found a body of a woman inside of a trunk, etc, etc....

All these are happening because of what I told above (specially in Point A) and because our local authorities are totally incompetent and corrupt, otherwise you cannot understand why they allowed some many new condos in Miami, these new condos, only cause pollution, traffic jams, real estate bubbles and, oh yes!: they mean a lot of money for them.
A week ago the Miami Herald published an article about people from Miami moving to the Carolinas or Central Florida...unfortunately Miami used to be a paradise, but as Adam and Eva spoiled for the rest of the humanity the Paradise that G=d gave us, our local authorities has done so with our lovely city.

Miami Vice

2006-08-21T12:50:00.000-07:00

FIFA World Cup Soccer!

2006-06-06T14:42:00.000-07:00

Perhaps you are not aware but in a few days the World Cup of Soccer will begin in Germany, it is one of the main sports events of the world, it is watched by billons around the world and probably some of those billons would call to their friends, relatives, offices, etc to discuss the last match of his/her national squad played the day before (I am one of them, I call to my friends during the half time to discuss which players we should change, unfortunately our Coach never hears us).

In order to give you an idea how huge event is for some countries, I will tell you a couple of facts that I know from first hand because I am a soccer lover and I am argentine:

- In Argentina, you will have a brief idea about what happens during a World Cup, if you know how it looks a U.S. City which team is playing the NFL finals, during a Superbowl Sunday: everyone is excited, the only thing that you can talk during that day is about the match, everyone is at home with friends watching the game, nobody is in the street and if there is any shop open, it is probably because it has a TV on and there is a bunch of people watching the game inside, well that it is probably what happens in Argentina, the only problem is that you must multiply that for 7 days (no just a Sunday) and then multiply that for 4 (four week = a complete month), thank God it is only played once every 4 years, otherwise the argentine GNP will be much lower than it actually is, because everywhere (at the office, school, universities, banks, government offices, etc) at anytime we have to watch the matches where Argentina plays...and usually also the ones that Brazil, Spain, Italy, England, Paraguay, Ecuador, Mexico, Costa Rica, USA, Poland, France, Portugal, Japan, etc. play and we will probably work, go to school, etc during Togo, Saudi Arabia, Tunisia and Angola games..but this last thing rarely happens because these last teams usually play against teams that we must watch.

- Usually the result that Argentina obtains during a World Cup determines how will be the mood of the argentines in the next 4 years (=until the next World Cup), I am sure that I am not the first one to tell you this, but I consider that some portion of the recovery of the Argentine Economy during these last few years, it is due to the fact that the last World Cup (2002) appearance of our national team was a fiasco, so we decided to concentrate just in our job because we need to probe ourselves that we are not just a complete disaster.

Now, a few reactions from a soccer fan (myself):

- since a week ago, I have not been sleeping well because I wake up in the middle of the night dreaming about goals made by our players.

- Charms, in Spanish we call them: "Cabalas", it is really important to have a good luck charm during the matches, during the World Cup in Mexico ('86) my charm was to watch the games in my parent's bed, in Italy '90 it was as well to watch the games in my parent's bed but with my legs crossed, during USA '94, I had to held with my right hand my mother's old kitchen towel, during France'98 I had to watch the game touching an old door with my left hand in my parents home, during Korea-Japan '02 I did not have any charm, because I thought that I was already a grown-up and that I did not need such things..unfortunately that Cup was a disaster for Argentina so for this one I have reconsidered my position and I will be happy to adopt a new charm (I accept suggestions!!).

Well, so this time I am attaching new rates for every country who is participating in the World Cup and only rates for these countries, this time you will find nice rates specially to:

Brazil ROC

Costa Rica Cell and ROC

Ecuador Roc

European fixed: France, Germany, Italy, Netherlands, Poland, Portugal, Sweden, UK

Germany Cell: with CLI and Roaming 100% guarantee!.

Iran Cell

Paraguay Proper and Mobile

Poland Mobile

Portugal Mobile

Global Traffic Meeting 2006 (Washington, DC)

2006-05-05T13:05:00.000-07:00

Dear All,

I have everything ready for the GTM, my suit, tie, shirt, shoes and my belt (yes my BELT!, because I learned 3 GTMs ago that the belt is one of the key parts of my outfit when I forgot it at home and I had to be the whole GTM sat in the hotel lobby because if I had stood, my trousers would have fallen to the floor)

I also have ready my perfect schedule with meetings every 30 minutes from 8am to 7pm from Monday to Wednesday, it looks really nice and neat...the only problem is that after 7 GTMs I learned that just a 20% of them will be have at the time and place scheduled, the 60% will be rescheduled to different places and/or times and the remaining 20% will be lost forever and in addition to that there will be a new 50% of meetings which were not scheduled and it will be scheduled there.

Why this happen?, because I do not have into account that I will have to spend time:

A) tracking down my boss before every meeting to take him with me,

B) queuing at Starbucks for a coffee which wake me up after last night party

C) chatting with an old friend after I bumped him/her in the escalator,

D) going to the bathroom at least once during the day (and perhaps more if I drink a couple of bottled waters),

E) checking and answering my email,

F) finding the stupid table R2ST in Section L where I have scheduled my next meeting, etc,etc...

In other words, my perfect and neat schedule will become a mess and a totally anarchy..but that's GTM and it is reason because I like it...otherwise it would be too boring and predictable.

Well, today I have a couple of nice rates to:

Argentina (Direct)

Australia Cell (Direct)

Bolivia cities (Direct!)

Brazil RJ and SP (Direct!)

Chile (direct!)

Colombia Cell (Direct)

Poland Cell (Direct!)

Ultimo (Last)

2006-05-01T15:06:00.000-07:00

El ultimo partido de cartas que jugaste con tu abuela,
El ultimo gol que metiste en un partido con tus amigos,
El ultimo helado que le pediste a mama que te compre
Cada vez que hacemos algo prestamos atencion a si es la primera vez que lo hacemos, pero olvidamos reflexionar sobre si sera la ultima.
Podriamos decir que Dios es injusto porque solo nos permite en raras ocasiones conocer con antelacion cuando sera la ultima vez que haremos algo, pero Dios tiene motivos que nuestra mente es incapaz de compreder.
Es por ello que debemos afrontar cada cosa como la ultima, de la misma manera que los chicos cuando suben a la calesita disfrutan cada vuelta como si fuera la ultima, si despues la sortija les regala otra nueva vuelta la disfrutaran de la misma forma que lo hicieron con la primera.
No importa que hayas hecho hasta hoy, lo realmente importante para vos, los que te rodean y Dios son cada una de las ultimas cosas que hagas porque por ellas seras recordado, condenado o juzgado y como no sabes que momento sera el ultimo, debes actuar siempre como si siempre lo fuese.

Donation

2006-04-28T09:02:00.000-07:00

Today for first time in my life, I gave blood, some nurses came to our building and while I was drinking my morning coffee I thought it would be nice to give some blood to someone who may need it.

So I filled some forms and 20 minutes later I was giving my blood...the only problem was that in the last minute of the procedure I started to think that it was my first time and last one, because I was feeling terrible dizzy and I almost fainted for a couple of milliseconds, when I woke up I was surrounded by 3 nice nurses who pampered me all the way, one was giving me orange juice, the other was putting ice on my head and the third one was with something to smell in her hand.

I felt sooo embarrassed...a nurse asked me if I had had breakfast today and I told her that I had a black coffee... she told me that black coffee does not count as breakfast..I also think that she kind of lie to me when she told me that I was very brave, because I was the first man to give blood today, all the previous persons were women and at that moment the other six people who were giving blood at that moment were women.

She also told me that I would be feeling like drunk for the rest of the day and I can do stupid things, she stuck in my shirt a little heart saying that I gave blood today, so everyone should be nice with me and forgive me everything...but apparently that sticker has not effect in my boss, because I asked him for an increase and he gave me an increase but of working hours....

Well..I am sorry for all this boring and long story today, but you know I have that little sticker on me and that means that you should forgive me, at least for today...

Well, I would like to offer you a couple of nice rates to:

Bolivia Cities (Cochabamba, La Paz, Santa Cruz) un our Direct

Honduras ROC Direct!

Peru Lima - Direct

Poland Mobile - Very good route and rate

and last but not least our rate to UK MOBILE under our direct! (sorry not CLI, just because our old international Siemens switch in Buenos Aires does not send CLIs)

Office Star

2006-02-08T13:16:00.000-08:00

El otro dia conversando con un amigo, me hizo ver algo que uno quizas lo ve como natural hoy en dia, pero es algo totalmente anormal y es ese alo de estrella que envuelve a las movie stars pero trasladado a la oficina.
Es ridiculo ver a la gente que tiene cierto "poder" dentro de los 1,000 sq. feets de un piso de un edificio actuar como Brad Pitt o Angelina cuando enfrentan a los miles de paparazzis y fans que los siguen dia tras dia.
Esa mezcla de snobbismo y sentido de superioridad que por ahi Brad o Jen pueden darse el lujo de tener, simplemente porque pueden darse ese lujo: tienen millones de US$ en el banco y otros millones de fans que le siguen los pasos, desde la ropa que usan, hasta las peliculas que filman pasando por leer las revistas donde aparecen.
Pero el Office Star?, que actua como un movie star, esperando (o deseando) que algun paparazzi se le aparezca en el pasillo para retrarlo, es ridiculo pero su reino es todavia mas efimero que el de Brad e infinitamente mas peque#o

Bishkek

2005-12-08T14:20:00.000-08:00

Dear All,

You have not heard from me in the last few weeks, because I was traveling looking for a place to install an small antenna and terminate minutes via a liquid PBX, my first destination was La Havana, Cuba, but despite that the rewards could be huge, the potential loss could be enormous (my own life if Fidel discover me). My boss tried to make me go because he thought that the rewards were bigger than my own life, I was barely able to convince him that I would mentioned his name to Fidel before he shoot me.

After that I tried to find another destination, it was not an easy task, because nowadays there are liquid PBXs in almost every country, I found out that one of the only countries where there is none is Kyrgyzstan, so I took a plane to Bishkek (the capital) and installed the Antenna there (I spent 5 days with -31F).

Well, now I am back, and I am offering this new destination with an incredible rate of $0.0375, when the ROC rate in the market is around $0.060, to make the things easier for you we are blocking and returning to you with a congestion signaling (T58) all the codes but the one for Bishkek, so you can terminate your really ROC traffic via your chosen underlined carrier.

I hope that you can send some minutes, because otherwise, my boss will terminate what Fidel could not...he will shoot me (or make me go again to Kyrgyzstan to recover the Antenna which is like dying because the temperature could reach -45F).

There is also some interesting rates to other destinations this time, like:

Afghanistan (ROC)

Aruba (Specially good quality to Mobile (Digicell)).

Cape Verde (all)

Costa Rica (Cell) - Direct

Dominican Rep. Mobile

Gabon (all)

Italy ROC & Mobile (Vodafone/Omnitel) - Directs

Ivory Coast

Jordan (direct)

Korea North

Liberia Cell

Malaysia ROC (Direct)

Morocco ROC & Cities (Direct 52%ASR)

Paraguay Mobile (Direct)

Peru Lima (Direct)

Uruguay Mobile (direct)

Other good destination with nice quality: Seychelles, Mozambique (all), Luxemburg (all), Turkey ROC, Syria (all), Vietnam.

Please let me know if you have any doubt.

Best Regards,

Alejandro

Rome Business

2005-11-30T07:24:00.000-08:00

I have been watching the superb series of Rome in HBO during the past few weeks, it is about the rise and fall of Julius Caesar and his allies.

During the last two weeks, I have been living almost the same within our company, it is funny how the history repeat itself, like a fractal the smallest part is equal to the bigger one.

I have seen the rise of Julius during the last few years and now I am an spectator of his fall, but does not the worst or funniest thing, this one its reserved to his friends and allies who now are suffering much more than Julius, because Julius is Julius: he had all the power, he had the money, he had the reputation and more or less everyone respect him and in addition to that now it is dead, so he does not have to worry about anything.

But his friends now they are at mercy of the coming New Julius and his friends.

I cannot stand that, I understand that in Rome and Julius Caesar times, but not now in the 21st Century and within a company which top objective is earn money for its shareholders (all this will make W. Buffett crazy if he had been the owner, he would have kick the ass of everybody :)).
So much energy (=time = Money) is wasted in this kind of issues that makes me sick, the problem is that I am sure if it is just a thing that happens here?

PS: Condo Craze is headed for Crash and burn in the Sun Sentinel is a nice article to read, other interesting one has appeared this week in Barrons

Orlando

2005-10-13T09:25:00.000-07:00

I have just returned from the Comptel show in Orlando, I am really glad,
because I am about to establish a new direct route.

The negotiation was really hard, first I had a problem with my first contact

because it was a kind of difficult to understand his English and then
suddenly he lost his temper and left the room, after him I had to start all

over again with a guy who promised me everything but later I realized that
he was a liar and he did not fulfill his promises.

Then I was assigned to a new group, and these two new guys worked very
efficiently...actually one of them did not talk at all during the whole
meeting and the other seemed sloppy and even I believe that he took a nap of

3 minutes during our meeting, but we managed to close the deal and the
contract is about to be signed by the General Manager of the company.

Just for your information, and in order to aware you about these guys
(please do not steal my direct!:)), their names in order of appearance are:
Donald Duck, Pinocchio and the two guys who finally close the contract are:
Pluto and Goofy, I think that the only more or less down to earth guy in
this group is the General Manager: Mr. Mickey Mouse.

With this route will be able to offer you termination to Magic Kingdom and I

think that I found a fantastic spot to place the antenna: in the castle,
right outside Cinderella's room.

Well, it is enought about talking soon to be routes and it is time to talk
about our current routes!!, they are:

- Australia fixed - Lower rate ever!
- Colombia ROC - nice rate
- Finland (ALL) - super low rate
- Ireland Mobile - a new low rate which is a perfect marriage for our
current amazing rate for Proper.
- South Korea - Incredible rate under our direct
- Ecuador - (test the Mobile, it is a very good route and stable)
- Poland Proper - You will not find a lower rate for your fixed traffic to
Poland with an ASR of 55% for all fixed codes.
- Others: UAE Mobile, Kenya (All).

The Hitman

2005-09-15T14:15:00.000-07:00

Please find attached some new rates from Telecom Argentina.

There are interesting rates for

- Bangladesh Mobile

- Brazil Mobile (and do not forget the rate that you already have for Brazil Proper under our direct, complete all codes, with 60% ASR)

- Iran Tehran

- Nepal Kathmandu

- Pakistan cities

- Panama ROC

And like when my mother cooked my favourite desert (Flan with Dulce de Leche), I kept the best for end (in the case of my mother's desert was the Dulce de Leche):

- Peru Lima - Direct 50% ASR

- Poland Proper- Direct >53% ASR

If you find a lower rate in the market (at a similar quality), just let me know, and I will hire a hitman to kill the person who is offering you the lower rate than mine...well, actually, doing some mathematics: it is better, I think, that you tell me which rate do I need to offer you in order to be first, because if it just a pennies lower, it will be much more cheaper than paying to the thug.

Please let me me know if you have any doubt (or you need the phone number of the hitman)

I told you!

2005-08-29T08:31:00.000-07:00

Last week I did not write because of the hurricane and because it was a terrible busy week, but that was good actually, because during last week I have been able to check that a couple of things that I have been talking since a couple of months ago, in some way or another are actually happening right now:

- Bubble: there is not any newspaper that do not include an article about the housing bubble almost every day (from the NYT, to WSJ, even the heavy supported by the construction and realtor industry like Miami Herald and El Nuevo Herald are talking about it) and even Mr. Greenspan talked about last week.

- Fundamentalism: Some of our own guys are doing what we criticize from the other crazy guys, Pat Robertson is one of our crazy guys, who make us look like crazy in front of the others.

- 100 people who screw America: I talked about this book and I mentioned that It was so poorly written that it can be written in a weekend, yesterday the NYT published the review of this book and they said almost the same.

- Hurricane: I told you that this year will be even worse, the ladies are dangerous and Katrina was terrible.

Rate Day

2005-08-19T14:52:00.000-07:00

This Week(end), we have the following destinations:

- Argentina ROC & Buenos Aires: Lower rate ever!!

- Dominican Rep (ALL): Incredible rate with 40% ASR - Please take into account that we can take between 10k - 12k daily.

- Israel ROC: Direct!

- Monaco KFOR: Direct!

- Panama ROC: good rate

- Philippines ROC & Mobile

- Zaire (ALL) for your Mobile traffic!

- Cuba: ok, ok, it is not an awesome route, but it has 28% ASR and 2.3 ALOC, you can use it for overflow and I discovered that when the call does not complete you hear a message in Chinese Mandarin (it is true!), so it is like we are offering super combo 2 x 1 destination: Cuba + China :).

Other interesting destinations: Armenia Mobile, Bahamas & Laos

It is not me

2005-08-18T08:05:00.000-07:00

"An unanswered question is whether developers are flooding the market. "The froth in several of these markets is approaching Cisco-stock-price levels circa 2000," says Hans G. Nordby, an analyst with Property & Portfolio Research, a Boston-based firm. Miami, for example, has so many investors, "it's going to implode," he says, adding that he's not convinced there's enough job growth there to support all the condos being built.

Mr. Nordby says Miami's market is dependent on speculators buying condos before they're built and flipping them in what is known as the preconstruction market. Developers building high-end condominiums often sell individual units long before construction is scheduled to begin, in part because banks won't provide financing until a large percentage of the units are reserved. In many cases, buyers can obtain a purchase contract by putting down just 10% of the sale price.

Miami-based Zilbert Realty Group, one of the city's largest brokers of preconstruction condos, has launched a Web site, Condoflip.com, catering to these speculators. Mark Zilbert, president of Zilbert Realty and creator of the site, says he's received thousands of emails from condo owners who want to gauge the market, but he doesn't yet see many interested buyers.

"Right now, people can just go ahead and buy a new unit, so they aren't interested in going through the hassle of buying a flip," says Mr. Zilbert.

Economists and real-estate investors say the ratio of real buyers to investors will ultimately determine the strength of the condo market. In Chicago, for instance, the large number of condo constructions and conversions -- including plans for what would be the nation's tallest building -- has created a supply glut. Several luxury projects have suffered slower-than-expected sales and some high-profile projects have narrowly averted foreclosure after banks came to the rescue."

It seems that I wrote it, but this is an extract of a WSJ's Article that appeared today in the front page.

Also noticed what the owner of Condoflip.com said in the article, I mentioned exact this almost a week ago, not because I had inside information, but only because I have common sense, you can see what I wrote last friday here.

Incompetent & Greedy

2005-08-17T08:51:00.000-07:00

Today the WSJ published not an article, but a whole section about the housing bubble, it is interesting, I believe that everybody is now talking so much about the bubble that I think that there is bubble about housing bubble articles (I have been talking about it by more than a year and half, so I do not count).

Yesterday I had to talk with my landlord in order to agree to extend the lease for 6 months (I am renting, what do you expect?...there is a bubble out there, I am not purchasing!:)), I just wanted to include a silly clause saying that I can terminate the lease whenever I want after 3 months, he was ok with this clause, but I could not get that my realtor and his realtor understand, agree and write the clause in the agreement.

Why are realtors working for themselves instead of his/her customers?, I do not understand, one thing that it was solved with a 3 minutes phone conversation between the owner and I, for the realtors took weeks of: "please say to his realtor that I want that in order that his realtor can talk with him, then, his realtor said that he said this and that, etc.,etc."...it is like talking using a not working phone.

Most of the realtors are not only greed, they are also thinking in serving only to his/her master (not his/her customers) and his/her master are themselves, you can see that in the Steven Levitt's paper which is partly published in his nice book Freakonomics, but if you would like to read it complete I recommend you to take a look at his actual paper, but that is not all other way to see their self-love is taking a look in the photographs that appear in the magazines promoting their business, they look like actors and actresses (and the problem is not that, the real problem is that they believe that they are actor and actresses!:)).

But the biggest problem is that they are incompetent, in which other profession someone could study two months and then take two exams and start doing business, negotiations, making recommendations to his/her customer in a million dollar range?...I can only recall just one other: being a politician in Argentina.

Destinations

2005-08-16T11:06:00.000-07:00

Today we have amazing rates to:

Australia Mobile
Austria Mobile
Ghana (All)
Honduras (ROC & Mobile)
Mauritius (All)
Morocco ROC & Cities - Superb Quality (54% ASR) - so good route that if the
movie Casablanca had filmed today, Ingrid Bergman would have phoned
Humphrey Bogart using it (this last weekend was rainy in Miami, it was
perfect for Popcorn and old movies :))
Nicaragua ROC
Pakistan ROC & Mobile
Paraguay ROC & Asuncion & Mobile
Portugal Mobile
Uruguay ROC & Montevideo.

There are also good rates to not so popular destinations like:
- Guinea Bissau (ALL),
- Kyrgyzstan (ALL)
- North Korea: If you have any minute to this destination, you should send
it using this route, I personally tested this route and it worked
perfectly!, by the way, if you are interested: they answered with a "no
comment" when I asked to the guy who answer the phone if they had mass
destruction weapons.

ooppps!, they did it again!

2005-08-12T08:05:00.000-07:00

Today in the front cover of the WSJ there is an article about the risen of house inventories (a key indicator to show that some air may be seeping out of the frenzied housing market), right now it is too soon to say that, because it is August (vacation season) and usually the inventories increase during this time, but it is a bump in the road that shows us that we left the highway and we are entering in a not so nice road.

Paul Krugman, today in his column in the New York Times, titled "Safe as Houses" wrote again about the bubble and his effect in the economy, he also pointed out the increase in the membership in the National Association of Realtors (58% from 2000), I believe that in Miami that figure it is much more bigger, as I mentioned a few weeks ago, everybody here is either a realtor or studying to apply for a license.

In the meantime, Condoflip.com is still uploading its database of condos, my intuition is telling me that there a lot of condos to be flipped (and that it is why it takes too long to upload them) and that there are not enough interested buyers to purchase them so they prefer to hold the offer otherwise the price will doom as soon as they begin to trade.

Today another article in the WSJ describes the CARTEL that the Realtors would like to keep and maintain, where are the free market and the invisible hand?

Real Estate - WSJ Article

2005-08-10T09:16:00.000-07:00

Today appeared an excellent article in the WSJ, titled: "Speculators push the rents down", it is good because it talks about current facts that are happening in the market, it is not the opinion of some real estate fan talking about the awesome returns earned until now and the future ones.

It is important that everyone who invest now in the real estate see that there is a potential loss and that investing in a real estate is not a foolproof investment with a sure upside, like the fans are talking as I mentioned on July 24th and 25th.

sssshhhhhhhhhhhhh! in London

2005-08-08T13:08:00.000-07:00

The Real Estate bubble has started to loss some air in London, according to a BBC
CondoFlip.com is still flipping, the "database" has not been loaded yet...

Paul Krugman today in his NYT column talked about the Real Estate Bubble, it is a nice article worth reading, you should take a look.

Weekend - Destinations

2005-08-05T06:45:00.000-07:00

New destinations for this weekend:

Australia Mobile (40% ASR)

Costa Rica (mobile and fixed) : 50% ASR

Ecuador Fixed (48%)

Morocco ROC & Cities (56% ASR)

Portugal ROC (50%)

UK Mobile (it is an increment, but you are now under our direct with 55% ASR for all networks at all times, no CLI due to an old requirement from our fraud depart., our international Switch in Argentina delete all the CLIs before sending a call abroad).

Uruguay Montevideo (60% ASR)

and other exotic destinations like Mauritius and Guinea Bissau, which honestly I cannot tell you which ASRs have because in Argentina is hard to find anyone willing to make a call to those destinations, but they work fine, because our techs have test them.

Days go by

2005-08-03T08:19:00.000-07:00

When I was younger, one of my top priorities was the time, I thought about it and count it in years, in the school my objective was to reach the end of the year, enjoy my long vacation and wait for Santa Claus (In Argentina the summer vacations are between December and February), since I was looking ahead in years, the minutes, days and in some cases months passed at a nice pace but the end of the year, and with it Santa Claus and the vacations seemed very far away.

Today, I do not if it is because I am in the broker business of selling and buying minutes or because I do not expect Santa anymore or because I do not have to wait until the summer for the vacations, I count the time in minutes and this means that it is the same that when I was younger, but the other way around: now the year, months pass at an awesome speed, but the minutes, hours are days move very slowly...

PD: Yesterday in the WSJ in the Deja Vu section appeared a wonderful article about the housing bubble in Florida during the 20's, you should read it, there is an Spanish proverb that said more or less this: "the communities who do not know their history, are condemned to repeat it"

ARBX or ARBW?

2005-08-02T07:30:00.000-07:00

Is Arbinet really an exchange or it is another wholesale carrier disguise as Xchange?, I think that he is just a wholesale carrier with a twist, the twist is that you know how much money is ARBX making in each transaction and how much his margin is.

It is applying the open source concept to the wholesale carrier business, some of the magic of each negotiation is lost: because you cannot negotiate or use your intuition to know if you can charge a little more, pay a little less or know if the LCR that you are seeing is 100% real (my experience taught me that usually the LCR is only between 80-95% real).

In ARBX all that romanticism is lost, but with or without it, I think that ARBX is still a wholesale carrier because:

- Assets: he has switches, gateways, billing systems so do the wholesale carriers.
- Sales and marketing: it has a sales and marketing team who sell the membership to the exchange, they also sell routes and look for routes to sale, so do the wholesale carriers, the only difference is that instead of membership the wholesale carriers talk about interconnection.
- Margins: the margins of ARBX are similar to the wholesale carriers (around $0.00650 per minutes, see presentation of ARBX in its website)
- Credit risk: Both ARBX and the wholesale carriers assume credit risk when they sell to customers.
- LCR: ARBX has a LCR, so do the wholesale carriers, the only difference is that ARBX's LCR is 100% true while the carrier's LCR is only 90% true.
- Neutrality: in a certain way ARBX and the wholesale carriers are neutral, because they only use the best route at the cheapest cost, only one who want to be out of business soon can apply another strategy (I always find someone who is applying this non-sense strategy), they are neutral because they only care about price and quality (not how nice is the carrier who sell the minutes) and in another way both are not neutral because each of them decide internally how to route each minute and to whom.
- Directs routes: both have direct routes, the wholesale carriers call them just Directs while ARBX call them Directs with an 'X' somewhere in the middle.

So in my opinion ARBX is just another wholesaler in the wall, the big difference, it is that they are actually making money, one important thing that only a few fine wholesalers can achieve, but that it is just because he has reach a very interesting scalability and because of that in some destinations he is a market maker.

Flipper - Pumping the Bubble

2005-07-28T08:11:00.000-07:00

During the '60s and '70s, Miami used to be known as the home of Flipper, the famous dolphin from the TV serie, during these days Miami is also known as Flipper's home, of course it is not the old and nice Flipper who passed away decades ago (I must confess you that I rather prefer Lassie, but my favorite is Mr. Ed, he is the coolest, he can talk!:
A horse is a horse, of course, of course,
And no one can talk to a horse of course
That is, of course, unless the horse is the famous Mister Ed.")

Nowadays, a Flipper is someone who purchase and sale, purchase and sale again, purchase and sale again, and so on a condo in Miami months or even years before the condo is actually built and making a handsome profit in each operation.

There are hundreds or even thousands of Flippers in Miami and each of them making tons of money, could you believe that?...well, try to believe it because it is true!

But that is not all, today I read in the Miami Herald that a website has appeared in order to match flippers buyers and sellers: www.condoflip.com

It is like www.kozmo.com meets Miami or Dot Com Bubble meets Real Estate Bubble in South Beach or kaaabuuuummmmm!!!!!!!

Like the guy in front of the NY Public Library shouts: "The end is near..."

Murphy

2005-07-27T14:49:00.000-07:00

Today it was not a good day:
"If anything can go wrong, it will" (Murphy Law)
"Never overestimate people's intelligence" (Howard Jonas, IDT Founder and former CEO, in his book "On the Roll", it is excellent, it is out of print, but I can send you a copy in PDF format, it is ok! and it is not illegal, because Howard likes to share it).
the good thing is that my AC is back in service

Without AC

2005-07-26T13:34:00.000-07:00

In Miami during these last few days the weather has been really hot (around
100F), yesterday night my AC broke and I became so desperate (yes!, my wife
is a housewife and she was desperate too), that I only could think about hot rates and

hot destinations while cursing my AC.

Well, after that long night, which other destinations can offer you hotter than this ones?:

Cameroon

Guinea Bissau

Ivory Coast

Mali

Sierra Leona

A couple of warm destinations of Latin America: Suriname, Costa Rica Mobile and Honduras.

The Russian Roulette & Bubbles Part II

2005-07-25T08:14:00.000-07:00

As I mentioned is impossible to know when a bubble will burst, because as Isaac Newton said when he lost a fortune during the South Seas bubble: "I can calculate the motions of heavenly bodies, but not the madness of people", you can know that a bubble exist because everybody is talking about how easy is to make money in the asset where the bubble exist and when I said everybody, I mean everybody: from the shoeshine boy to the supermarket cashier, from a housewife to an investment banker, there are also other bubble signs like: new TV channels and magazines appear in the market that only talk about investments on that asset, etc., etc.

The problem is that you cannot foresee when the bubble will burst, because you cannot know how much is the maxium madness that the people can reach and this is why The Economist has been predicting the end of the bubble since 2003 without success.

What I can tell you that once the bubble is there, for sure it will burst, it can take: 1 month, 6 months, 1 year or 2 years, the longer it takes, the harder will be the hit.

Once the bubble is established, to invest in it, is like playing the Russian Roulette: you do not know if in the next shoot the bullet will be there, but you know that there is a bullet in the gun and if you keep shooting sooner or later you will be dead.

The Russian Roulette & Bubbles Part I

2005-07-21T08:18:00.000-07:00

I have read in research papers, newspapers and magazines a lot about the real estate bubble, and I wrote about it here in many occasions, and it all depends on what you read or who you hear.

Some people say that the real estate Armageddon is near while others say that the value of the condos will increase even further in the coming months.

In the first group you can find one of the best newspapers (yes!, it is a newspaper not a magazine) in the world: The Economist, who since 2002 has been telling us about the imminent burst and in the second group you can find a lot of people, but they are usually: either realtors, an economist from the National Realtor Association or real estate investors.

About the last group, you have to be very very very careful when you read comments from realtors or predictions from an economist of the NRA, they are usually very optimistic. Hearing what realtors or NRA's economists have to say about the real estate bubble is like hearing a car salesman talking to you about the fairness of the car quotation that he has just provided you.

Neither can you hear real estate investors, because since they are already "addicted" to the bubble, its like taking into account the advice that a junkie can give you about drugs.

But that does not mean that you can think that the articles who are predicting the bubble burst soon are right, as I mentioned The Economist has been predicting the doom of the real estate prices since 2002, and the prices have only risen even further since then.

so, what should you do?.... to be continued tomorrow...

Terra R.I.P

2005-07-20T07:30:00.000-07:00

Last July 5th, 2005, Terra Communications Corp. has left us, the judge ordered at around 3PM to all Terra's employees to leave the company immediately and changed the locks of every door.

Terra filed Chapter 11 by February 2005, but the judge sent them directly to Chapter 7, which I think was a wise decision because:

A) As July 19th, 2005 most of Terra's employees are already working in other company, so there were not job loss.

B) The invisible hand of the market, should be allow to work freely, when a company cannot compete fairly and square in the market, it should disappear, otherwise is a waste of resources and since these resources can be used in a more productive way.

C) During the boom of the last 90's, there is an overcrowded telecom market, which is not good for anybody, the Chapter 11 is not the ideal solution, because after it only turns that companies into walking zombies who eat the brains of the healthy ones, as one CEO of the airline industry said: Companies go to Chapter 11, like people go to Spa..it should not be like that.

Talking about zombies, OTC, is not only walking again, I saw an advertisement on the TV last Friday which promotes its new card: Taxi Card, I believe that they are doing all over again, because with the slim margins in the prepaid calling card business, it is impossible that you can advertise in TV without loosing money.

Fundamentalism

2005-07-19T20:46:00.000-07:00

I was in B&N last weekend, B&Ns are one of my favorites places in the entire world, I can spend hours there: just reading a book while drinking a coffee (other favorites places are: watching a soccer match of my team: River Plate in TV, spending an afternoon playing soccer with my friends or having a Sunday breakfast at bed reading the newspaper...But since my team is doing awful this year and because my friends are in Argentina and I cannot play soccer with them anymore, I have only two pleasures lefts)

Well, lets return to the point: I read in B&N a book titled: 100 People Who Are Screwing Up America and besides I found it very poorly written, without research, the kind of book that anybody can write in a week or so, I thought that I would find there people like: Kim Jong II or Bin Laden instead I found people like Paul Krugman, who is a notable economist, he received the John Bates Clark Medal in 1991, it is an expert in International Economics and you can share or not his thoughts about the current administration (I personally not agree in everything he writes about it in the NYTIMES), but definitively he is not one of the 100 people who are screwing up America, like many others that appear in the book.

I am worried about that book, because, it sounds a lot like of what Bin Laden is doing: the evil is the one that does not think like him and believe in what he believes.

I personally think that it is extremely important that everybody can talk and write about what he/she thinks, without being worried about appearing in a book titled the 100 People who are screwing America.

Enough

2005-07-18T09:13:00.000-07:00

The bubble is about to explode, do you remember the last nineties when a domain name (just the name) were selling for millions, like China.com, which was sold at around $85MM!!, well we have the same in the real estate here in Florida:

Lots in trailers camps are being sold for more than $500,000...Yes you read right, then you can rent that lot (and have to include a trailer) for around $700/$800, that gives you a P/E of around 90!!, so investors are expecting a lot of growth in their investment, they are either expecting that Tom Cruise and Kathy Holmes move to a trailer after their wedding transforming the trailers in the next "in" thing in Hollywood, or that waiters and teachers will receive a 1700% increase in their salaries and they will be able to pay a monthly rent of around $3,300.

Convergia

2005-07-15T14:58:00.000-07:00

I have talked with a friend, who used to work in Telecom Argentina in Argentina and he left the company a couple of months ago to join a company who has directs with Latin America and Europe and they are apparently changing the way of how the world communicates (?!).

Well, the story that he told me went like this, before joining the company he agreed a certain salary (for example $100), but after his first month, he received a payment of $40, he went to the HHRR department to inquiry about the difference, thinking that it was a mistake and they told him that it was not a mistake and he could take that $40 or leave the job.

Of course he left, and he is currently looking for a job in Argentina (if you think that finding a job in the U.S. is hard, you should try in Argentina), but that it is not the point, because I am pretty sure that he will find a job soon because he is a nice guy with the a lot of knowledge and experience.

The point of my history is the following, if that company can do that to its own employees, what do you think that they can do to its providers?...Just be careful, please.

The name of the company?...I have already told you, just re-read the posting.

The Real Estate Bubble & The Seinfeld Effect

2005-07-14T13:42:00.000-07:00

You are probably thinking why I write so often about the Real Estate Bubble, when I am really in the telecommunications market and here are my reasons:

A) I am Economist, and almost all the Economist have fascination for the bubbles, it is really interesting to investigate and watch them (and Yes during 1997-2000, I was fascinated with the Telecom Bubble) and

B) Because, here in Miami, nobody talk about other thing.

Well, since all the bubbles are almost by definition are irrational, I have not heard about a rational bubble yet, one of the best way to check if a bubble is in place is to compare the irrational situations that one is experiencing under a bubble with a rational one, like when Joseph Kennedy sold his shares before the 1929 crash because he overheard shoeshine boys and other novices speculating on stocks, which was not a rational situation to see.

Taking into account that I would like to explain the Seinfeld Effect, you have probably watched the Jerry Seinfeld Show and remembered his funny friends, one of them was George Constanza, the one with glasses, chubby and bald who usually was looking, without success, a girlfriend and who lived alone in an apartment or sometimes with his parents.

The question is: how did George earn his living?...no, he was not a bank clerk or an employee in a retail shop and for sure he was not an investment banker, a doctor or a lawyer...

He was a real estate agent... a REALTOR!, can you believe it?, I guy looking like that, having an average life and earning a just ok! salary?!.

If you compare George with any of the current realtors in Miami, you will see the difference, they look like Hollywood actors, they look like Tom Cruise or Angelina Jolie and that it is not a problem, because probably the good looking is important for their profession, but what really matters is their life style, which is not like it the one that our poor George had, because, thanks to the bubble, they now earn hundred of thousands per year and they have lavish apartments and convertibles....and I am not talking about a few exceptions, almost all the realtors are experiencing that kind of life style.

The only problem that they have right now is that it is so easy to be a realtor, that apparently everybody is either planning to be a realtor, studying to be a realtor or a realtor...so a glut of realtors will decrease, dramatically, their earnings soon (this happened before, just read the excellent book from J. K. Galbrait:The Great Crash 1929 when he talks about the real estate bubble in Florida during the '20s)

The additional offer of realtors will correct the Realtor Bubble which is a side result of the Real Estate Bubble, but this last bubble will not be corrected.

The Seinfeld effect is useful, because through it, we can see that a bubble exist in the Real Estate Market as Kennedy saw through the conversation of the shoeshine boy the Stock Market bubble.

Semi Annual Sale

2005-07-13T12:22:00.000-07:00

Unfortunately a couple of days ago, I learned from my wife that the ominous couple of weeks of the year for my wallet have arrived: The Semi Annual Sales.

My wife tried to cheer me up saying that actually it is a period where we can increase our savings a lot, because since everything is in sale, when you purchase something in a 60% sale, you are actually saving 60% of the purchase!, so that means that when she purchased that pair of shoes with a regular price of $200 for $80, she actually did not spend $80: she saved $120 (!!), "It sounds logic" I said and she quickly explained me that if she instead of that shoes, she purchased a pair of Manolo Blahnik's shoes the savings would be even greater, wisely I told her that I preferred to wait until we see in our saving account the actual credit for all the purchases that she had made.

And now it is time for you to save in our Semi Annual Sale, you will find the following destinations:

- Eritrea

- India ROC

- Morocco (ROC, Casablanca & Rabat): 52% ASR

- Niger

- Poland Proper 56%

- Uzbekistan

- Venezuela Caracas >50% ASR

I kindly remind you that, according to my wife, the more minutes that you send, the more money that you will save!!.

Bubbles and Hurricanes

2005-07-12T15:55:00.000-07:00

The Hurricanes have lot of air and winds and the bubble have air inside, if you add more air to a bubble the bubble will be bigger.

The Hurricane Dennis passed by Florida and apparently the Real Estate Bubble and the Hurricane are a perfect marriage, because all the air that Dennis brought fed the Real Estate Bubble.
Today I received an email from a colleague who used to work in one of our hardware providers ,saying that he was leaving the company to join a commercial real estate development firm (!?!).

This sounds a lot, like the guys who during the 1999 were leaving his job to be a daytrader... Ah!, it is important to tell that if you pump too much air in a bubble, the bubble will explode...and the Hurricane season has just started and we expect a lot of Hurricane....

Book & Cable

2005-07-11T08:07:00.000-07:00

During my vacation, I discovered an interesting author, it was by chance, because I had finished the book that I brought from home, which was excellent, and I was desperate looking for a new one...An almost impossible task in Quebec, Canada: to find a book in English.

I was so desperate that I offered to my wife to take her to the biggest mall there, hoping that I would find a bookshop with some titles in English and I only found one, that had hundreds in French and only a dozen in English, all but two of those books where best sellers novels, one was from J.L. Borges, a superb Argentine writer, and the other from an unknown, for me, writer called: Alain De Botton.

Since I read all Borges' book, I chose the one from De Botton ("On Seeing and Noticing") and I found it delicious!

The book was cheap, only CA$4, but for me was really expensive because I had to add to that cost all the purchases that my wife made at that mall...

Last Friday Pakistan suffered a cut in its solely undersea cable system, so this means that the communications were interrupted for a while, because the satelite backup was not enough.

Return

2005-07-08T07:52:00.000-07:00

Just returning from my vacation, I have been in a couple of hotels and auberges, from 1* to 4* and all have one thing that has been common during these last few years in every hotel, hostal, motel, etc: The message in the bathroom regarding your towels, the one that says that we need to protect the environment, blah, blah, and if you would like to re-use your towels and protect the environment...and You will go to heaven....
I believe that there is something in that message that it is not written anywhere, and it is that in this case, and it is the only case, where the hotels are really preoccupied about the environment and it is not because the environment, but because the savings that they could have without cleaning the towels, if they can protect the environment as well, it is great, but this is not their really objective.
Once again, we should say that Adam Smith was right ("It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.").
It is because of their self interested that they are protecting the environment...So perhaps, we need to figure out more self interested situations where an indirect effect will be a protection of the environment...
One Gossip: a big exchange has announced the suspension of the credit line to two big customers, do you want to know the customers????.... GX & PRTL....

TGI & TGV

2005-06-17T12:00:00.000-07:00

We are experiencing some problems with Honduras & Costa Rica Fixed, our techs are working to solve this issue asap.

This Sunday is Father Day, the traffic is not so high like the Mother Day, but it will be a nice Sunday.

I wonder why the Father Day traffic is not like the Mother Day traffic?, it could be because everybody know who his/her mother is, but they are never sure about who his/her father is?, so we prefer to call to greet our mother because it is a sure bet instead of calling our father and taking the chance to greet the wrong guy?...I am kidding, of course, but who knows?

as time (in Minutes) goes by

2005-06-16T13:21:00.000-07:00

Today we have good routes to

- Costa Rica (fixed and Mobile) - Very good performing route

- Eritrea

- Honduras (fixed and Mobile)

- Israel Mobile - Direct

- Italy Proper - Direct

- Lebanon Mobile - Very good route

- Morocco Proper, Rabat and Casablanca - Direct

- Nepal

- Portugal Mobile - Direct

- Tunisia (Argentina defeated Tunisia yesterday, in a soccer match in the FIFA Confederations Cup, we betted with our correspondent in Tunisia that depending of the result, Telecom Argentina or their company would reduce the termination rate...and Argentina won, so now we have a very competitive termination rate that we are passing to you...thanks to Juan Roman Riquelme (argentine soccer player))

- UAE - good route, and specially good for your mobile traffic

I also would like to inform you that I will be on vacation (at last!!!!) for 14,400 minutes, a little more than 1 x T1/day of vacations!...I do not know if this happen to you too, but since some time ago, I have started to count the time for everything in minutes, instead of years, months, days or hours...and now that I am thinking about it, perhaps this is whay I must take some time to relax...

Well, for those who are still sane, I kindly confirm you that I will absent from June 20 to June 30, but if you have any trouble or inquiry, please send me an email, and you will receive a detail message back explaining what you should do and to who you should contact depending of the kind of inquiry that you had, but please remember that if the problem is really really really urgent and important, you should contact 911 (at least if you do not have one of those new VoIP phones which does not have access to E911)

Yahoo, Skype, Comcast & Vonage

2005-06-15T11:46:00.000-07:00

A couple of years ago, AT&T, MCI, Sprint were the king, queen and bishop, now the two first ones no longer exists as independent corporations, they are just a business unit of a bigger company and Sprint decides (wisely) to focus in the mobile business jointly with Nextel.

And now.... today Yahoo announced that it acquired DialPad, you can read the article in the WSJ, Skype has millons of users and Comcast and Vonage are adding hundreds of new customers daily.

This means that in the near future, the minutes will belong to this new operators...but we are not connected with any of them....who can form an association, a la Comptel/Ascent, but representing this babyboom generation ? (I am calling it babyboom generation, because there are really a lot of new VoIP providers, everybody has either a blog, a VoIP company or a realtor license :)).

This Association should organize shows and meetings twice a year in order that we can meet them and interconnect them.

Of course the first rule of this Association should be: No meetings in Orlando, FL :)

Armageddon

2005-06-14T13:09:00.000-07:00

Today is one of these days that you would prefer to skip, it should exist a kind of TIVO for life, where you can play again nice days, pause happy times and skip days like today.

Too much bureaucracy kill corporations or at least make them sleepy. It only creates silly jobs and internal procedures that do not have any other objective that to justify a certain job or position. All the slim mania, should be applied to Corporations as well, because as humans, they become fat too.

Once again I return to the real estate bubble, because today I read an article in The Miami Herald (http://www.miami.com/mld/miamiherald/business/11887830.htm) which talks about a "perfect" combination between the Real Estate and the Internet and a new website which looks to capitalize on the area's already booming condo market... could you believe it?..it is webvan all over again.

It also said that the condo market in Miami is like commodity purchase and that there are an increasing number of people buying condos without seeing them (!!!), to me it sounds more like a tulip mania purchase than a commodity purchase (look for "tulip mania" in wikipedia.org)

A good article to read is the one that appeared today in Barrons (http://online.barrons.com/article/SB111868780503858244.html?mod=9_0039_Investors').

and about the telecommunications market, these last few days have been very very quiet...no news good news???.....

Our routes to Ecuador Mobile and Proper, Uruguay Mobile, Syria (ALL) are doing fantastic, you should try them if you have not yet.

Monday Morning

2005-06-13T07:26:00.000-07:00

We are going to increase our rate to Venezuela Caracas and Puerto Rico.
We have some nice rates to Cuba, Ecuador Mobile & Proper.
We have done some major upgrade in our NYC switch and the quality to almost all destinations should improve considerably since today.

Here in Miami the mega-bubble continue, it is almost impossible not to meet someone who is either applying for the realtor license, buying or planning to buy some house or condo, selling or planning to sell their apartment or house (these last ones are the smartest)

The Hurricane Season started a couple of days ago, this year is ladies turn, this means that every hurricane will have a lady name, the weather experts expect to have a kind of bumpy season (it should not be a correlation between ladies names and bumpy season, but who knows)

Inauguration day

2005-06-10T10:03:00.000-07:00

Today is the first day of this blog, and it is a perfect day to start with it because is FRIDAY!!!!.

Now it is time for the commercials: because I would like to comment you that we have a couple of strong routes with nice rates (you only has to inquiry me about it) like: Brazil (ROC & Belo), Israel Proper, Ecuador (Fixed), Paraguay (ROC and Asuncion), Uruguay Mobile, Venezuela Caracas, Peru Lima, Poland Proper, China Proper, Italy Proper and Puerto Rico.

The capacity to these destinations is not infinite, so you should hurry-up is you would like to get some...like the stampede o get one "iPod Shuffle" from Arbinet in the last GTM.

I also would like to start a public referendum to change the venue of the next Comptel-Ascent show, which is in Orlando, FL.

I do not want to scare you (ok, I really want, because I want to get your support!!), but it is still hurricane season in October and last year, one Hurricane (Charley) almost reach Orlando, FL.

In addition Orlando, FL is such a booooring place....let's move the meeting to nicest places or places where I have never visited: San Francisco, Seattle, New York, Las Vegas, Chicago, Salt Lake City, Denver, etc.