As IF Times

link Photos: Riots, fire, destruction after Vancouver’s loss | Posted | National Post.

Protests against government oppression? Rioting to get adequate food or shelter? For human rights? For religious freedom? Iraq? Afghanistan? Libya?

ENHH!

It’s mild mannered,  latte sipping Vancouver after a hockey game!  This is a variant on the old joke that people went to a fight and then a hockey game broke out.  In fact, the criminal activity that followed in the aftermath of Vancouver’s loss to Boston in game seven of the Stanley Cup had nothing to do with hockey.  The convergence of so many people in one place allowed a few instigators to ignite and inflame mob mentality.  People in the aforementioned conflict regions of the world would be amused to see such violence and mass hooliganism over essentially nothing at all.  Sociologists will of course rush to explain the actions with the usual bleats about angry, disenfranchised youth, yada, yada, yada. 

That’s not going to wash, since there are few cities in North America with a more affluent population.  These weren’t street people with nothing to lose acting out of desperation over their circumstances;  these were affluent young men living in perhaps the most benign part of North America.  If anything, it was more of an entitlement mentality gone wild.  The chaos was exacerbated by a couple of things.  Firstly, the sheer numbers of people just standing around served to aid and abet the hooligans in their primal rampage by providing cover.  Secondly, the poor response tactics of the police which allowed the thugs to ‘burn’ themselves out instead of enforcing order only served to embolden the criminal activity.  The mayor expressed that the police had done a fine job of keeping the peace.  !!??  As long as you weren’t a car or shop owner in the vicinity or sitting in a port-a-potty, I suppose that’s true. 

In watching the live video, it wasn’t obvious that the police were effective at all in enforcing any kind of order.  The tactic seemed to be to wait the storm out rather than prevention of damage.  Probably just kids letting off steam.  That’s certainly a debatable strategy and represents the coddling mentality that exists in this part of the world.  The local media are chock full of experts who are tsk tsking the activity of the crowd and predictably expressing shock that this could  happen in Vancouver.   People can delude themselves and be complacent about human nature in this part of the world, but the stark reality is, in a mob scene, it may as well be Lord of The Flies.  The police can’t be afraid of acting like police.  They can’t act as if they were security guards waiting for the police to arrive.  They ARE the police! 

Apologists are quick to point out that these weren’t hockey fans and in no way reflected Vancouver as a whole, a sentiment which is plausible.  This is to be kept in mind the next time “passionate” protests break out against  a G8 summit, or global warming , or some other excuse for idiots to cause havoc. 

We can only hope that the miscreants are caught and get a strong scolding.  Crazy kids.  I’m sure it won’t happen again.

link Why Groupon Is Poised For Collapse.

Lurking underneath the hype of crazy valuations for ‘social networking’ companies recently are some sobering realities of their business models.  Talk abounds now of a $100 billion dollar valuation for Facebook for example.  Ahem.  Groupon has seen a meteoric rise from only 3 years ago to achieve some real eye popping valuations in advance of their much anticipated IPO.   But what are people buying?  This article gives a revealing look at the mechanics of the Groupon model.

For those not steeped in finance, it’s essentially a mechanism to give short term loans to small businesses, which, under the right terms, is a good thing.  It’s somewhat eerie to consider that the financing model looks strikingly similar to the whole housing mortgage disaster which crippled the American economy just recently.  In both cases, money was essentially lent on favorable terms in advance to people on the financial fringe on the expectation that the carrying cost would be offset by rising house prices or by increased sales volumes in the case of the Groupon model.  Now that I think about it, that’s the same model used to sell Government treasury bonds.  Hmm.

This all works as long as things go as expected.  What are the odds of that not happening?  I’m sure the flinty eyed MBA’s and actuaries at the big investment firms have done their risk calculations to arrive at a resultant valuation for the IPO.  After all, to float a $100 billion market cap company, you’d have to convince a lot of smart people, not just the rubes buying 100 shares for their grandkids.  The truth is, many investments are good investments only because everyone else thinks they are, not neccesarily because of fundamental reasons.  Stock investing is prone to the dictates of fad just like accesories in the fashion world.  Compounding that is the reality that many investment professionals drink from the same cup as far as market wisdom; the Bernie Madoff scam proved that just recently.

Actually, I think the Groupon founders are geniuses for creating such a finance model since it obviously fulfills a need in the marketplace.  The reality is that no one gets something for nothing in business.  Consumers may get goods at a discount using their services, but definitely not to get their stock.  If it were me, I’d wait for the discount.