thinking: relating- celebrating :-)

For the past week or so it has been interesting to note the different media treatments of the developing swine flu story.

It now clear that globalisation and easy air travel means there are almost certainly more case of the flu than we know about and in more places.

Even in New Zealand we now have 12  14 confirmed cases as of today. There is the predictable argument about whether health authorities have done their best to manage the known risks and these will continue.

One irony is that many of us learned about this online from a twitter or other source before the news media picked up the story for later in the day. Hopefully social media and other online readers are doing their own research so we can avoid the moral panic / mass hysteria that does seem to result from this type of news item. 

Its about time we used our greater information resources to fight fear with knowledge..

“fear of the flu is at least as responsible for the economic disruption as the disease itself.”

There will be travel and tourism side effects for Mexico and many other countries as authorities try to balance public safety and health concerns with personal freedoms.

In reading about the background of this particular wave of the flu it seems that much of this should have been no surprise and all of the planning and scenario practice that went on a few years ago (SARS) should now be worked through.

In the US in 1976 (after the Fort Dix outbreak) around 40m people received swine flu immunizations. However the programme was called off for all sorts of reasons.

I just wonder whether vaccinating the pigs themselves might be a smarter way to break the disease mutation cycle. Seems that pigs provide the ideal conditions for viral mixing of the influenza disease strains. 

Much more recently an estimated 35 million have been treated with Tamiflu in Japan which is one of the recommended treatments.

Mass vaccinations are not popular but we can bet they are being considered in many countries. The NZ government had a stockpile equivalent to 21% of the population in 2006 during the avian flu pandemic planning.

According to some new reports

“Australia has stockpiled 8.7 million doses of Tamiflu and Relenza drugs”.

There will be public debate over how those stockpiles are used and when and there should be.  NZ information about Tamiflu is over here. Predictably that site is way out of date but there are updates over at the Ministry of Health

In the past few weeks I have been tuned in to watch a Mexican ife science entrepreneur and thinker – Juan Enriquez talk about science as the way foward from crisis. His talk called Beyond the crisis, mindboggling science and the arrival of Homo evolutis. 

“Even as mega-banks topple, Juan Enriquez says the big reboot is yet to come. But don’t look for it on your ballot — or in the stock exchange. It’ll come from science labs, and it promises keener bodies and minds. Our kids are going to be … different.”

About Juan Enriquez

Juan Enriquez thinks and writes about the profound changes that genomics and other life sciences will cause in business, technology, politics and society.

“Formerly CEO of Mexico City’s Urban Development Corporation and chief of staff for Mexico’s secretary of state, Enriquez played a role in reforming Mexico’s domestic policy and helped negotiate a cease-fire with Zapatista rebels. He is a Managing Director at Excel Medical Ventures, a life sciences venture capital firm, and the chair and CEO of Biotechonomy, a research and investment firm helping to fund new genomics firms. The Untied States of America, his latest book, looks at the forces threatening America’s future as a unified country.” From his TED bio  

Beyond the crisis, mindboggling science and the arrival of Homo evolutis. 

Juan has two other video presentations on TED that are also worth checking out.

Juan Enriquez: Decoding the future with genomics

and

Juan Enriquez: Why can’t we grow new energy?

I like the idea of good news from Mexico at a time like this. I see the NZ MOH has labelled the flu as being Mexican Swine Flu. I’d rather have some enlightenment from Mexico via Juan Enriquez.

The other week I was dropping a neighbours kid home from an after school programme. He asked me why my car wasn’t a flash new one.

I wanted to say that I’m trying to reduce the size of my carbon footprint and I’m hoping this is the last petrol powered car I will ever own – but that seemed like wishful thinking.

However this week there was a new video release from TED’09 of a bold new plan for electric cars. What is intriguing and significant is that the car industry themselves could miss this new direction (with some notable exceptions.)

Only yesterday I was reading about how Holden in Australia could be the first local car industry to go bust.

”Australia’s car plants are losing money faster than a drunk at a casino and there’s no feasible way of turning this around.

”The Australian car industry can re-focus on small cars, green cars, blue cars or red cars. None of this will make the slightest difference.”

Mr Clive Matthew-Wilson (NZ) believes the government money would have been better spent by giving it to the affected car workers

I wondered what would happen if AU car industry started putting electric motors into their cars but the view seems to be that globalisation of manufacturing costs just makes Australia non-competitive.

I’d still think that higher tech approach for electric cars is worth pursuing and maybe Renault and Holden should be talking?

 In fact Australia is part of the Better Place electric car project already. The car 2.0 is avery bold plan for Australia that will make a difference. Obviously Clive missed all the news about Better Place in Australia.

Shai Agassi’s  plan offers a huge ray of hope for the future of modern civilisation and energy futures generally.

What I love about this story is that the innovation happens around the business model. That is: separating the batteries from the cars in terms of the overall cost model.

Shais thinking is bold and clear and his actions have prompted backing from governments who can see the future. Check Shai s background here. A very impressive career at SAP prior to his Better Place project.

New Zealand Transportation policy is firmly oriented towards supporting electric cars. To quote from some of that report.

5% market share (for electric cars) is way too conservative and NZ has an opportunity to do better. We have one of the cleanest electricity generation systems in the world.  We should be on the phone to Mr Agassi  ASAP.

“Major vehicle manufacturers (17) recently made a commitment to commercially develop electric cars, with reports suggesting that these may be available from as early as 2010. Our scenario assumes electric vehicle sales reach five per cent of market share in 2020, followed by a period of rapid growth that reaches a plateau of 60 per cent by 2040. “

However the practicalities and other logistics of the cars have been difficult until this project.

“Shai Agassi wants to put you behind the wheel of an electric car — but he doesn’t want you to sacrifice convenience (or cash) to do it.

When horrific climate-change scenarios elicit little but endless chatter from governments and entrenched special interests, the difference between talk and action represent an embarrassing gulf. Meet Shai Agassi, who has stepped fearlessly into that gap. His approach to solving the puzzle of electric automobiles could spark nothing short of an automotive revolution.

Agassi stunned the software industry in 2007 by resigning from SAP to focus on his vision for breaking the world’s fossil-fuel habit, a cause he had championed since his fuse was lit at a Young Global Leaders conference in 2005. Through his enthusiastic persistence, Agassi’s startup Better Place has signed up some impressive partners — including Nissan-Renault and the countries of Israel and Denmark.

“Shai Agassi has only one car, no charging stations, and not a single customer—yet everyone who meets him already believes he can see the future.” – Wired”

Here is the best video you will see ever on the future of electric cars.

The NZ government should be rolling out the red carpet for Shai. More background on Shai’s plan.

So will we get electric cars anytime soon?

I’m much more hopeful than before. We need to look at energy futures much more seriously than we have been doing and Shai’s vision is a very good place to start.

Now here is an interesting idea.  A 1 year mortgage holiday from some banks in Australia and possibly in NZ as well.

Reading the fine print I’m guessing it is only a few really good customers (higher equity ratios?) who will qualify but it does offer some hope that banks are taking a more positive long term view.

I’m also guessing that as NZ banks are all AU owned thewre is an opportunbity here for the NZ government to talk to their Federal counterparts in Australia.

As home ownership rates are dropping and more people in both countries are renting I’m not so sure what the net effect of this will be but perhaps it will slow down some of the flow on effects of a slower economy.

“Westpac bank will let some struggling borrowers take a year-long break from repayments as part of various measures to help those hit by the recession.

Westpac is Australian-owned. It is the first bank in New Zealand to offer a repayment holiday.

It is also offering to allow some borrowers to make interest-only payments, or extend the period of their loan.

The bank says it will brief staff on the appropriate way to manage situations of short-term financial hardship where people cannot meet their mortgage obligations.

It will offer assistance on a case-by-case basis, as the option of delaying repayments will not be suitable for all borrowers.

The Australian Bankers Association announced last Sunday that the Commonwealth, NAB, Westpac and ANZ banks will postpone home loan repayments for up to 12 months for people in hardship.

The association said it had struck a deal with the federal Government to help people who have lost their job and are struggling to pay the mortgage.” RadioNZ

What I’m more interested in is what the detail criteria are and how this all plays out.  I suspect some of this has to do with exit fees on mortgages being so high that breaking the mortgage would leave the clients even worse off.

The other scenario is probably where selling the property won’t repay the bank’s loans because the property is now worth less than the loan.

” In another case, a beachfront unit sold for less than the mortgage but the finance company involved would not allow the sale to proceed, as the mortgage over the property could not be discharged. The lender will now handle the sale, he says.”  More detail over here SMH.

“Australia is headed for a macroeconomic crisis as spending plunges and people get rid of debt, then a housing crisis as people with mortgages lose jobs and massive defaults on loans as people cannot pay them. “

In that case the bank really has a mutual interest in the status quo even if they might forgo some short term repayments.

I believe most banks will grant most performing customers a 3 month mortgage repayment holiday anyway so a 12 month “holiday” could be worth asking for.

Although it is a good idea to be clear on the extra costs as they can be substantial. Interest only is a better idea if you can get that.

“That is because the interest keeps compounding, and is added to the end of the loan. ” Herald Story

According to some of the smartest people I know we need to both reduce debt and keep spending in order to create a viable pathway foward.

That sounds like a contradiction but I’m guessing the key is to reduce exposure to credit as far as possible and try to pay cash for bills as they come due.

And dare I say it – we should be looking for more sustainable business model than the boom and bust cycle most of us have grown up with.

What I’d be looking for as a business is a way to cover late debtors payments which seem anecdotally to be rising and hopefully avoiding any major defaults.

On the more positive side it does seem that if you have cash you should be able to negotiate better terms of trade and more leverage as a buyer.