Hillary Clinton Must Debunk the Notion That Donald Trump’s Wealth Qualifies Him for President

Without the wealth, however, Trump is no more than just another loud-mouth.

So Hillary Clinton must address and debunk this aspect about Trump. It is absolutely crucial. Clinton must present a clear and convincing case as to why Trumps vast riches do not qualify him to be president.

Clinton recently attempted to do just that. Disturbingly, however, she utterly failed. Clintons approach was to reference a past quote from Trump about how he had hoped the housing market would crash because then he could buy-up assets on the cheap and make a lot of money for himself. She attempted to shame him by saying that Trump selfishly cared only about his own personal profits and not about the millions of Americans who lost their homes in the crisis.

Clintons approach was a blunder. Trump shot right back by saying that as a businessman he knows how to identify opportunities for success even in bad situations, and that as president he would employ this skill for the benefit of ordinary Americans.

BAM! Trump hit it out of the park. Home run.

This is exactly why his supporters believe that Trump will be better for the nation than Clinton. It demonstrated to many people that Trump knows how to be successful, and that Clinton has no clue how to be successful.

Clinton has attempted some other approaches as well. She referenced that Trump had a few companies that failed and wound-up in bankruptcy, and she stated that therefore Trump as president would lead the nation into bankruptcy.

But again, this utterly misses the point. Trump is super rich. Trump has been tremendously successful. It doesnt matter that a few of his ventures failed. Overall, he has been spectacularly successful. And his success is on full display for everyone to see with Trump giving interviews from his gleaming penthouse apartment and flying around to campaign stops in his own massive jet. Clintons lame attacks seem to underscore her own inadequacy, and Trumps supremacy.

Clinton also attempted to ridicule Trump for his failed casino by asking rhetorically how anyone could possibly lose money running a casino. This just rings false and hollow. Trumps casino is surely not the worlds only example of a failed casino. In fact, the entire casino industry in Atlantic City has suffered grievously. This just makes Clinton seem as if she has no solid arguments against Trump, which makes Trump appear ever stronger.

Clinton must do better. Clinton must make the case as to why Trumps wealth does not qualify him to be president.

One potential argument seems apparent.

Lets ask ourselves, how, in fact, did Trump make his money? Did he invent a new product, say, the way Steve Jobs invented the iPhone? No. Did Trump create a new computer application to make life easier for millions of people, say, the way Bill Gates created Windows? No. Did Trump develop a new way for people to better communicate with each other, say, the way Mark Zuckerberg developed Facebook? No.

So what did Trump do? Well, Trump built or bought a handful of luxury real estate properties. Thats all. Nothing more than that. There is nothing particularly special or unique about Trumps properties. They are just luxury properties designed for wealthy people, some commercial and some residential, no different than all of the other luxury properties designed for wealthy people.

So if Trump did not do anything special, how did Trump become so wealthy? Simple. The market went up. Thats all. And Trump had absolutely nothing to do with that. Luxury real estate has skyrocketed in price, and Trump benefitted from it.

As further evidence of this, when the luxury real estate market went down in the late 1980s, so too did Trump. If Trump were the genius he proclaims, he would have foreseen this and avoided it.

Now, Trump bristles at the suggestion that he was bankrupt. His denials of bankruptcy led to an uproar of accusations that he was flat-out lying about it. In a half-truth, half-deception, Trump conceded that several of his companies filed for bankruptcy, but Trump boasted that he never filed for bankruptcy himself, personally.

While it is true that Trump never filed for personal bankruptcy, this assertion is highly deceptive. Trump himself even said so much. In a story that Trump appears to have told in many variations, Trump and Marla Maples, now one of his former wives, were walking down a New York City street and Trump pointed to a homeless man and said to Maples that this homeless man was worth $1 billion more than Trump. What Trump meant by this was that while the homeless man owned nothing at all, Trump was far worse off than the homeless man because Trump had incurred $1 billion more in debts than he owned in assets.

The reason Trump was spared from having to file a legal claim in court for his own personal bankruptcy was because the banks bailed him out with an emergency rescue loan package. The banks rescued Trump not to save him for any reason, but for their own benefit. If Trump had filed for personal bankruptcy, all of his assets would have been sold in a fire-sale auction and this would have depressed the prices and resulted in great losses to the banks.

So Trump is not any sort of a genius. When the market goes up, Trump goes up, and when the market goes down, Trump goes down. Thats all. Trump tells us how smart he is and how great he is, and this appears to be backed-up by his extraordinary wealth. But the reality is that Trump had very little to do with it. The art of the comeback? Thats a joke. There was no artfulness by Trump. The overall market is what came roaring back and Trump just so happened to be along for the ride by dumb luck.

Clinton could turn Trump into a prime example of all that is wrong in our economic system that has resulted in such drastically unfair wealth inequality. Trump is a guy who was born into wealth and privilege, he merely went into his fathers already established real estate business, and then, without doing anything extraordinary himself to benefit society, Trump became fabulously wealthy when income inequality took-off like a rocket for the benefit of the wealthy and at the expense of everyone else. When a cartoon character like Trump can become filthy rich without contributing much of anything to society, this proves that our system is in dire need of an overhaul.

But if Clinton fails to make the case as to why Trumps wealth does not qualify him for the White House, then we will all suffer through the reasons in real life under President Trump.

Wedbush Advises Investors To Tread Clear Of Alphabet Inc (GOOGL) And Twitter Inc (TWTR) Among Others

Wedbush tech team published a report of itsrecent findings regarding the top technology stocks. The list includes high profile stocks that have shown deteriorating fundamentals and are likely headed towards a slump.

Alphabet Inc. (NASDAQ:GOOGL) has reached a point of saturation, such is the beliefof Wedbushs tech team. According to the analysts, the risk associated with the stock, especiallyduring the 2H will be at its peak as the companys search monetization hits the peak. In the long term, the risk is largely associated with newly employed marketing strategies that may push consumers to look for alternatives. The positives for the stock is monetization improvement and ad growth on YouTube. However, concerns remain regarding emerging competition for YouTube from social media video platforms and TV networks going online.

Twitter Inc. (NYSE:TWTR) has been struggling for a while, and given its presence on the list, it most likely will continue to do so. The growth in advertisement remains nonexistent and part of it can be attributed to the degree of difficulty consumers face while using the service. The companys progress is sluggish and advertiser circles remainunconvinced.

Square Inc. (NYSE:SQ) is heading down a road that possibly ends from where it began. The company is working to establish a business that might never provide profitability. In addition, the SMB loan broker business remains a risky bet. There are some regulatory concerns on the horizon regarding the companys loans.

Workday Inc. (NYSE:WDAY) is on its way down thanks to a major deal that was broken in its core HCM business. The companys business model remains successful but the problem lies in fast fading number of consumers which may in part be due to Oracles aggressive selling tactics.

Groupon Inc. (NASDAQ:GRPN) is going to struggle in near term as it has gone under a process of restructuring and it will prevent growth for the next few quarters. The restructuring is likely to help in growth but near term prospects remain dull despite the fact that it is one of the top channels for brick and mortar stores to acquire traffic.

The analysts cautioninvestors to tread carefully when trading with above tickers as the risk associated outweighs rewards.

DBS Indonesia Sets Strategy to Push Fee-Based Income

“We are targeting a 50:50 portion between net interest income and fee-based income for the next three years,” Peter said.

DBS Indonesia now earns three quarters of its income from interests charged to debtors. The lenders net-interest income was recorded at Rp 603 billion in March this year, up 14 percent from Rp 529 billion in the corresponding period last year.

The banks fee-based income was at Rp 376 billion in March this year, up 13 percent from Rp 333 billion in the same period last year.

DBS Indonesias outstanding loans now stand at Rp 39.7 trillion, relatively unchanged from last year as demand for company loans has yet to recover.

The lender disbursed 80 percent of its loans to companies in the plantation, automotive, pharmaceuticals amp; chemicals, fast-moving consumer goods, food and beverage, and infrastructure sectors. The remaining portion of the loans are channeled to consumer business companies.

Appeals Court Denies Tilton’s Challenge to SEC Case

A federal appeals court in New York refused Wednesday to stand in the way of a fraud case that the US Securities and Exchange Commission brought against former distressed-company financier Lynn Tilton.

Ms. Tilton sought to raise a constitutional challenge to the SEC administrative securities fraud action, which focuses on the $2.5 billion collection of distressed company loans she controlled until recently.

The Second…

Bankruptcy 101 for Investors: Salvaging Your Investments from the Ruins of a Portfolio Company Bankruptcy

That intriguing little tech company in which you invested has just filed bankruptcy. Will you ever be able to recover any of that investment? Maybe. It depends upon the form of your investment. And because recoveries depend upon the form of the investment, you may want to consider how you document your investments in the future.

The harsh reality is that almost all businesses that file bankruptcy are insolvent in the most basic sense of that term: they have more debts than assets. This means that the asset pie is too small, and not everyone will be paid the amounts to which they are entitled.

Bankruptcy is a process designed to divide up that too-small pie among creditors and equity holders in the fairest way possible under the circumstances. All creditors and interest holders must file proofs of their claims or interests that document the basis for their right to distribution from the company, so that their claims may be allowed as valid both as to nature and amount of the claim.

For allowed claims, the Bankruptcy Code establishes a hierarchy for payments that takes account of contract rights, state law, and bankruptcy principles. Those at the front of the line secured and priority creditors have a decent chance of at least partial recovery. Those at the very end — equity holders — rarely receive anything.

But these allocations are not set in stone. In a chapter 11 case, the debtor and creditors are permitted to modify the treatment of claims, if the affected parties consent to the terms of a proposed plan of reorganization. So, if you think that the company has value worth fighting for (as opposed to simply writing off losses), then you may want to enter into negotiations with other constituencies in the case to try to improve your outcome.

The Front of the Line: Secured Claims

If you lent money to the company on a secured basis, good news: you probably will recover some amount. Secured creditors stand the best chance of achieving substantial recovery in bankruptcy, to the extent that their pledged collateral has value. If you are fully secured, you should be paid in full eventually. If you are undersecured, at least your secured portion should be paid, and you may recover something on account of the unsecured portion of your claim.

Typically, secured creditors have lent money to the company subject to a security interest in either real estate or other assets, such as receivables, equipment, or intellectual property. Under state law, a secured creditor has the right to foreclose on the asset and sell it to repay the debt. Bankruptcys automatic stay prevents foreclosures from proceeding, but in exchange, secured creditors are entitled to be repaid the equivalent value of their collateral and to retain their liens until that payment is made.

Bank lenders fit the classic stereotype of secured lenders, but private equity or individual lenders are increasingly commonplace. In addition to secured claims arising from loans, vendors may hold purchase money security interests in the goods or equipment they sold to the company.

Major Issues for Secured Creditors:

  • Value of the collateral: A loan may be secured by the companys headquarters building, but it is a secured claim for purposes of bankruptcy only to the extent of the current value of that real estate. In other words, a US$500,000 loan secured by a lien on a property now worth only US$400,000 will be treated as a US$400,000 secured claim and a US$100,000 unsecured claim for the amount of the debt that exceeds the collateral value.
  • Treatment: A plan of reorganization usually provides for repayment of secured claims over a period of years, during which the creditor will be paid interest at a specified rate. If you as a secured creditor expected payment at maturity on a three-year loan, you would probably be unhappy to find that the plan proposes to repay you over a ten-year period, especially if the plan proposes an interest rate substantially below that specified in your loan agreement.

Possible Responses:

  • Contesting valuation: A dispute about the fair market value of real estate or receivables will usually be resolved by the bankruptcy court based upon competing appraisals. More challenging, however, is the valuation of intellectual property, such as patents, copyrights or trademarks, which are often the only assets available to a tech start-up for securing a loan. If the IP hasnt yet generated any revenues, then valuation will essentially be speculative, although, whatever its value, the IP is probably the only asset of any material value. Such disputes are typically resolved by settlement, with the secured creditor allowing the other creditors a portion of the value, whether that value is realized by sale or from revenues of the business after reorganization.
  • Contesting treatment: Debtors often provide for a protracted payment period for secured claims and a low interest rate because that combination means lower payments that leave some amount of net cash flow available to pay (or at least promise) to unsecured creditors. The Bankruptcy Code requires that secured creditors receive discounted stream of payments that at least equal the current fair market value of the collateral. If you want to contest treatment, you will need to file an objection to confirmation of the plan as well as vote against the plan. Contested confirmation hearings usually require evidentiary hearings, and are thus expensive. However, most such objections are settled by re-trading the deal embodied in the proposed plan.
  • Leverage: If you are willing to advance more money to the company as a DIP (debtor in possession) lender, so that it has the cash necessary to stay alive during the case, you may be able to increase your leverage over the plan process. DIP lenders are entitled to be paid in full, with interest and fees, ahead of even prepetition secured creditors. Some courts allow a roll-up of prepetition secured debt into the DIP loan for inventory and receivables collateral as it is used by the debtor, in effect elevating the status of the prepetition loan into the even higher priority of the DIP loan and insuring against any attack on the original loans validity or security. Moreover, if the company continues to lose money during the case, a DIP lender may effectively have a stranglehold on the case. Of course, it will also have sunk more good money into what may still be a black hole of need, but at least the company will be the DIP lenders very own money pit. This may make sense as a bet on the long-range value of the IP, but can be a highly risky proposition.

Lessons/Considerations for the Future:

  • Because of the likelihood of disagreements over the value of collateral, you should consider whenever possible seeking a blanket security interest covering all assets, rather than just one category. If you have a lien on everything, then other creditors cannot contend that the real value of the company lies in the assets to which your lien doesnt apply.
  • If your collateral is IP, be especially careful to take all necessary steps to perfect your interest by filing with the US Patent and Trademark Office, Copyright Office, and the state of incorporation. Otherwise, the creditors committee, acting on behalf of the unsecured creditors, may seek to invalidate your security interest. It is up to the creditor to assure proper recording.
  • A security interest granted within 90 days before the bankruptcy filing to provide additional assurances (usually after a payment default) to a previously unsecured creditor can be avoided and set aside on the grounds that the granting of the security interest gave an unfair extra edge compared with other unsecured creditors. However, the possibility of a challenge should not deter you; you should almost always seek such improvement in your position to provide better leverage in the event of bankruptcy. It is important to seek advice to structure such enhancements in a manner that offers the best possible defenses to any later attack.

The Middle of the Pack: Unsecured Claims

Unsecured creditors include bond or commercial paper lenders without collateral (or with insufficient collateral), trade creditors, employees, personal injury claimants, and other general creditors. By law, certain unsecured creditors have priority over others. Wage and benefit claims, tax claims, obligations for goods delivered on the eve of bankruptcy, and certain other types of claims are entitled to be paid before other unsecured claims, subject to statutory caps on the priority amounts. With the exception of pension claims in some cases, priority claims usually constitute a small percentage of the overall debt.

As an investor, you probably wont hold any priority claims. More likely, you may have made unsecured loans to the company or entered into other contractual arrangements that give rise to general, nonpriority unsecured claims.

A creditors committee will usually be appointed to represent the interests of unsecured creditors collectively. Typically, the largest non-insider unsecured creditors are selected, but the US Trustee seeks to have representation of the various types of claims, so appointments are not strictly by size. If you want to be active in the case and you are representative of a grouping of similarly situated claims, you can apply to be appointed to the committee. Partially secured creditors will usually not be considered. Bear in mind that members take on fiduciary responsibility to maximize recovery for all unsecured creditors as a group. These obligations might limit the strategies you would otherwise want to pursue in the case.

Major Issues for Unsecured Creditors:

  • Fraud claims against insiders: The committee or trustee often pursues claims for fraud, mismanagement, breach of fiduciary duty, or negligence against management or the directors, particularly where recovery on director and officer liability insurance is a possibility. Be aware that, if you have played a major role in the company, you may be among the targets for such litigation. On the other hand, if you are not a target, then you may benefit from any such recoveries as a member of the class.
  • Defending against claims objections and preference claims: In most larger chapter 11 cases and many chapter 7 liquidation cases, the committee or trustee will review the filed proofs of claim to determine whether the claim is well founded and the amount is accurate. If not, the committee or trustee will file an objection to claim and the creditor will have the ultimate burden of proving its claim against the debtor. The committee and trustee are also likely to sue unsecured creditors who have received payment on their accounts within the 90 days before the bankruptcy filing, just as creditors who received a late security interest might be sued. Many defenses exist. Most preference actions are settled.
  • Plan treatment: Plans of reorganization often separate various types of unsecured claims into different classes that will then receive different distributions under the plan. The Bankruptcy Code confers on debtors considerable discretion to create multiple classes of unsecured claims. Some classification limitations do apply. Most importantly, first, all claims in a particular class (or subclass) must be legally similar in character. Second, all claims in a class must be treated the same way. Third, between classes, any differences in treatment must not unfairly discriminate against one or more classes. As you might expect, the third requirement generates the most litigation.

Possible Responses:

  • If you are sued, whether on fraud allegations, objections to your claims, or preference actions, you will have to deal with the defense just as with any lawsuit. However, more options may exist for fashioning a settlement, as such disputes are often settled as part of the general horse-trading process to achieve a global resolution of the case under a plan that satisfies most creditors as essentially fair.
  • The flexibility of the similar claims and not unfairly discriminate standards offer considerable leeway for fashioning creative global settlements. Ultimately, however, particular creditors or classes of creditors upset with their treatment may be able to extract additional value by filing objections to the plan, which may prevent the debtor from achieving a consensual plan. Occasionally, such disputes lead to confirmation battles when the amount at stake justifies the extremely high cost of such litigation.

Lessons/Considerations for the Future: Unsecured lenders usually wish they held secured claims, but that is not always possible, especially if secured credit has already been maxed out. And trade creditors usually wish they had monitored their accounts receivable more conservatively to avoid undue exposure. In short, unless they supply an absolutely critical component for the debtors products, trade creditors individually dont have much leverage.

The Back of the Line: Equity Interests

In most cases, it is obvious from the outset that equity interests are entirely out of the money. Most plans simply wipe out old equity. Equity holders rarely find it worth participating in the case, with only a few exceptions as discussed below.

Major Issues for Equity:

  • Asserting equity value: Occasionally, initial estimates of asset value and outstanding claims indicate the possibility of a recovery for equity. In most cases, it will turn out to be an illusion, when later, more reliable data shows that the initial asset values have been overstated and claims understated. But if a material possibility of equity recovery exists, then the court may be willing to appoint an equity committee, in addition to the creditors committee. And in such cases, the debtor or trustee bears the additional fiduciary duty to maximize the value of the estate for the equity holders, not just the creditors.
  • Subordination of securities fraud claims: In the cases of publicly held companies, bankruptcy filings are often entangled with allegations of securities fraud, often with pending class actions as a major cause of the bankruptcy filing itself. In bankruptcy, unlike under state or federal securities laws, securities fraud claims are not treated like typical claims. Instead, Bankruptcy Code sect;510(b) specifically requires fraud claims seeking damages arising from the purchase or sale of securities to be treated as subordinate to the class of that security. So such damages claims are last in line behind the stock or other equity interest and therefore never have value in the bankruptcy case.
  • Tax and control issues: For tax pass-through entities, the recapture of depreciation as the result of a bankruptcy filing can be expensive, even if no equity value remains as of the time of filing. In some cases, equity owners are simply far more optimistic than creditors about the long term prospects for the company or its IP, and correspondingly loath to cede control.

Possible Responses:

  • Even a relatively attenuated argument of equity value will likely lead to some value left on the table for equity in the plan bargaining process. It is almost always cheaper to give equity the hope of some recovery in the future if the reorganized company performs better than expected.
  • The conflicting goals of securities law enforcement actions seeking forfeiture of corporate assets and the bankruptcy process sometimes offer leveraging options if the securities regulators are willing and able to go to bat for the victims of securities fraud.
  • It is possible for old equity to become the new equity even though creditors are not being paid in full. To do so, old equity must contribute substantial new value to the plan so that they can come out of the case still owning the equity. If enough new cash comes into the distributional pot, of course, creditors may be quite happy to allow old equity to emerge as the new owners. Alternatively, a third-party buyer with the participation of some old equity may take ownership through a reorganization plan, subject to full disclosure. Complicated rules govern the circumstances where old equity can emerge as the new owners.

Lessons/Consideration for the Future: If your investments are primarily in equity, you must be prepared for a complete loss in the event of a bankruptcy filing, unless you are willing to buy back the company from its creditors. If you also have a senior secured position, however, you may not care about your equity, as you may end up owning all or most of the assets or new equity on account of your secured claim.

Final Comments

The opportunity to cut deals about priority and treatment of claims and interests really only exists in chapter 11. Chapter 7 liquidations are governed by a relatively strict interpretation of priorities and proper treatment. If a feasible plan can be proposed, a case may be converted from chapter 7 to chapter 11 to make the deal possible through a plan.

Next in the series: Doing business through special purpose entities to limit bankruptcy risk.

Retired Partner Engineer at Microsoft Shares Rags-to-Riches Story

Its interesting, in that the main reason I interviewed with Microsoft was more out of anger than anything else. I actually didnt want to work for Microsoft. That was back in the fairly early days of software the big guys were WordPerfect and Lotus and so forth, and Microsoft was coming on big. They had launched Windows, but it wasnt doing all that well it wasnt until Windows 3.1 that it really took off. Microsoft was the Evil Empire companies like Ashton-Tate [where I worked] were falling apart. When Ashton-Tate got bought out by Borland, I needed to find another job. So I started looking at other companies in the [Silicon] Valley, and it wasnt until people from Ashton-Tate told me one by one that Microsoft had turned them down that I realized Microsoft had a presence there.

So I basically really did apply just to kind of mess with them. My assumption was, I would apply, and they would want me, and I would turn them down [saying], lsquo;Finally somebody you wanted from Ashton-Tate said no to you, then I would go on with my life. I was absolutely shocked when they turned me down the first time.

Santino worked on a lot of projects over the years at Microsoft, and I asked him what his favorite was. He said it would have to be creating and leading the Enterprise Engineering Center:

That was an opportunity to really be almost an entrepreneur in a company like Microsoft. I did a lot of entrepreneurial things early in my life, none of which worked out, other than as learning experiences. But to be able to do an entrepreneurial-like thing with Microsofts money greatly enhanced the chances of success. Microsoft really at that point had won the desktop they had a 90-plus percent share in operating systems, word processing, and spreadsheets. But they didnt own the enterprise frankly, they knew very little about going after the enterprise.

So we needed to build a facility like the Enterprise Engineering Center from scratch basically, a lab that would allow us to replicate the network topologies of enterprise companies, and install their in-house applications, our software, as well as our competitors software. We could build out these environments and truly get an understanding of how corporations were using our software, and do it at a time when the software was still under development, giving us an opportunity to fix any issues. Im sure youre aware that over time, Microsoft would release a product, and customers would report some issues that were missed, and wed do a service pack. After a while, corporations would learn, dont install the first one wait for the service pack, and let somebody else be the guinea pig.

So here was our opportunity to work directly with the enterprises, bring them to our lab, and then ship products that are deployable from Day One. That was an amazing accomplishment, and the fact that the company allowed me to spend that kind of money building something at a time when the market around us was crashing, and companies were going out of business, was just fantastic it was like I owned my own business, in the middle of Microsoft.

Given Santinos entrepreneurial spirit, I asked him if he ever considered leaving Microsoft to start his own tech company. He said he didnt, and he explained why:

I went to work for Microsoft, in spite of the fact that I didnt really like them, and I learned very quickly that the company was all about results if you worked hard and got great results, you could do very, very well there. I used to tell people, if youre going to work in software, theres no better company to work for than Microsoft. There was no reason for me to go off and try to do something on my own. I was working for a great company that provided me with great support, paying me extremely well I didnt need to take that risk. The entrepreneurial period of my life was over. I tried many, many different businesses, some that worked better than others. But now I had the opportunity to have those same sorts of entrepreneurial feelings, but with no risk of having to close the business. It really was the best of both worlds.

I asked Santino if he had it all to do over again, what he would do differently. He said hed try to get to Microsoft sooner:

All the years I spent as an entrepreneur were great fun, except the way they ended. I learned a great deal from it. But the success and fun and opportunities I had at Microsoft truly were a great experience. It was an opportunity to touch a lot of peoples lives. Im glad I retired when I did I was 55, and it was time to do a lot of things that I had been putting off because I was working as hard as I was. I started at Microsoft when I was 35, when a lot of people start there straight out of college. It would have been nice to get there sooner, and be a part of that early growth.

But I really dont have any regrets, because each one of those things, no matter how much of a failure they felt like at the time, was along that path that got me where I was. Frankly, if the shoe repair business didnt collapse, and we didnt declare corporate and personal bankruptcy and load up a U-Haul truck and move to California, I never would have gotten to work for Microsoft. So even though it sucked at the time, it was a very important step along that path.

Santino said now that his book is finished, hes eager to do some professional speaking:

I want to talk to people when theyre young about the opportunities out there in the world. Sadly, were hearing a lot these days, especially from politicians, about how the American Dream is dead, how the deck is stacked against you, how its unfair, the systems rigged, vote for me and Ill fix it all, because you dont stand a chance. Thats such bull. I still think that in America, you can get out there, and if you work hard and put in the effort, you can still go from rags to riches. But you have to be willing to take on that ownership, and get out there and make things happen for yourself.

That was a great segue to my next question: Whats his advice for young people who aspire to make it big in the tech world? He said the first thing to do is to get an education.

Though I didnt get a college degree, the competition out there is absolutely fierce. So get into a decent school, acquire those skills, and make sure you do internships. Its so hard to come straight out of college and apply to some of these companies. Make sure you get the summer internships, and start to forge those relationships with the company. Once you get in there, bust your ass. Find out from your boss what the company values, and what it rewards. Do those things, and do them better than everybody else. Dont do anything halfway. Give it your all.

Santino also shared a fascinating inside look at the culture within Microsoft, and how it changed over the 20 years he was there. Ill cover that in a forthcoming post.

A contributing writer on IT management and career topics with IT Business Edge since 2009, Don Tennant began his technology journalism career in 1990 in Hong Kong, where he served as editor of the Hong Kong edition of Computerworld. After returning to the US in 2000, he became Editor in Chief of the US edition of Computerworld, and later assumed the editorial directorship of Computerworld and InfoWorld. Don was presented with the 2007 Timothy White Award for Editorial Integrity by American Business Media, and he is a recipient of the Jesse H. Neal National Business Journalism Award for editorial excellence in news coverage. Follow him on Twitter @dontennant.

Woodhouse may force multinationals to talk about tax

Multinationals may be forced to disclose more information about their tax affairs, amid concerns they are too often bending the rules.

Revenue Minister Michael Woodhouse said he was disappointed major multinationals had been deafeningly silent in the wake of allegations that some of them had been shirking their fair share of the tax burden.

That was apart from saying they were satisfied they complied with New Zealand laws, he said.

The Australian government is trying to make multinationals open up about their tax affairs and New Zealand might follow suit, Woodhouse said.

READ MORE:
* Victory at hand in multinational tax battle but NZ may not get the spoils
* Big US firms hold $2.1 trillion overseas to avoid taxes: study
* OECD forecasts company tax rates will fall as rorts stamped out

The question Australia is asking is should they give a better explanation of the difference between their accounting profit and their taxable profit and how that is channeled away.

Any additional disclosure obligations could force multinationals to be more open on matters such as how they used transfer pricing to charge their local subsidiaries for services and the interest they charged them on intra-company loans, he said.

While a discussion paper on Australias proposed tax transparency code envisaged it would be voluntary, Woodhouse hinted at a tougher approach saying the question here was the degree to which companies should or should be required to release more information.

However, Woodhouse indicated he would be reluctant to remove a legal muzzle on Inland Revenue discussing the tax affairs of individual businesses – even in cases where the department believed that might be helpful in maintaining trust and confidence in the tax system.

Woodhouse said the rule had prevented Inland Revenue discussing the tax affairs of the Pfizers and the Googles or the Shells even with him, and that had felt very black box.

The Storybook Homes And Scandalous Divorces Of The Sunset’s Rousseau Brothers

Although Henry Doelger is the Sunset Districts most famous and prolific builder, his was just one of several firms that transformed San Franciscos Outside Lands in the early 20th century. Brothers Oliver and Arthur Rousseau may have constructed fewer homes than Doelger, but their distinctive designs continue to turn heads nearly a century later.

In 1932, the Rousseaus developed a parcel that includes 36th Avenue between Kirkham and Lawton.

Oliver Rousseau and his older brother Arthur were born to build houses. Their father, Charles Rousseau, was a well-regarded architect, and he eventually partnered with his sons to create Marian Realty Co. in the 1920s. According to an historical survey of Sunset builders, the company specialized in hotels, office buildings and apartment houses, until the Great Depression cratered most large-scale projects.

The Rousseaus pivoted to residential construction. Arthur focused on raising capital, while Oliver was tasked with designing architecturally stimulating houses that were affordable to households of moderate means. 

1564 36th Ave. was built as a Rousseau model home in 1932. | THE SAN FRANCISCO CHRONICLE, 4/2/1932

Rousseaus eclectic designs were a significant departure from Doelger homes, which already dominated the landscape by the time Oliver and Arthur began building in 1930. Defying expectations, Oliver designed fanciful, sometimes opulent homes that were still within reach of middle-class buyers; a Spanish Colonial Revival might be bookended by a Storybook castle on one side, and a Tudor Revival on the other. 

Today, Sunset House is worth about $1.6 million.

In the end, historians believe the Rousseaus built fewer than 200 homes, but they made a major impression on Depression-era consumers seeking value and style. They were among the first architects to make built-in garages a standard feature, and they also popularized floor plans featuring central patios that adjoined major rooms.

In 1932, Marian Realty built 1564 36th Ave., which stands today as one of the Rousseaus most representative projects. The English Tudor was unveiled as the Sunset Model Home, the shining jewel in a new 150-home development facing the beautiful new Sunset Boulevard, reported the Chronicle.

Developer Arthur Rousseaus home at 1500 36th Ave.

When built, the 2,125-square-foot Sunset House would have cost about $7,000, or roughly $113,000 in todays dollars. These days, Trulia pegs its value at $1.6 million.

The Sunset House had a flagstone patio, multiple fireplaces, a three-car garage, and a magnificent marine panorama that extended to Ocean Beach. Although sales materials at the time claimed the propertys sight lines would remain forever unobstructed, trees, new buildings and the occasional Muni bus now limit the homes view of the Cliff House.

The brothers both eventually lived in homes of their own design. Arthur resided at 1500 36th Ave., while Oliver chose 1598 36th Ave.

Both Rousseau brothers had messy public divorces. VIA THE SAN FRANCISCO CHRONICLE, 10/3/1916

Although adjectives like storybook and fairy tale are used to describe the Rousseaus homes, the brothers personal lives were anything but. In 1912, Arthurs wife, Eulalia Edith Rousseau, filed a cross-complaint against him after he initiated divorce proceedings.

In her suit, Mrs. Rousseau denied Arthurs allegations of extreme cruelty, including charges that she struck him in anger and neglected her responsibilities as a homemaker. Why, I never in my life refused to prepare my husbands breakfast, and I have witnesses to prove that he was never kept waiting for dinner, she told the Chronicle.

Architect Oliver Rousseau designed his corner lot home at 1598 36th Ave.

Four years later, Olivers wife, Irene M. Caubu Rousseau, filed for divorce on the grounds that he was physically abusive, aloof from their young son, and often disappeared to party at an East Bay yachting club. I want a different chicken every night, like my brother Arthur, he reportedly told her. 

The Rousseaus business didnt last long. In 1933, three years after pivoting to residential development, Marian Realty Co. declared bankruptcy, with debts topping $6 million. Arthur filed for personal bankruptcy two months later, but held on to both of his yachts and the house on 36th Avenue, eventually passing away in 1944 at age 58.

Oliver Rousseau later remarried and continued working as an architect, creating thousands of units of housing for workers in the East Bay during World War II, as well as tract homes and apartment buildings around the Bay Area. He died in 1977, at age 85. 

The largest development of Rousseau homes in the Sunset can be found from 33rd to 36th Avenues, between Kirkham and Lawton.

Australia’s NAB looks to boost small company loans, offset mortgage slowdown

By Swati Pandey

SYDNEY, June 1 (Reuters) – National Australia Bank plans to tap surging demand for corporate credit by becoming the first major bank in Australia to offer small companies unsecured loans online.

Australias big four banks already supply a variety of unsecured loans to small businesses, but NAB is betting that its online service will be popular due to its convenience.

The move comes as NAB and rivals Commonwealth Bank, Westpac and ANZ Banking battle to offset a slowdown in home loans, which have typically been a core part of their businesses.

The overall size of loans extended to businesses in Australia grew at its fastest pace in April since 2008, according to a report this week by analysts at UBS.

This (increase in corporate loans) is net positive for banks. If anything this is where the growth should be, said Bell Potter analyst TS Lim.

Australian banks have been grappling with slowing earnings after years of record profits.

NAB said on Wednesday that its QuickBiz Loan would launch in early June, with customers able to apply for up to A$50,000 ($36,400) in funding online. Annual interest will be charged at 13.85 percent, compared with nearly 5 percent for home loans and an official cash rate of 1.75 percent.

Commonwealth Bank and Westpac have entered into referral tie-ups with separate online lending companies for business loans, mainly targetting small businesses.

The increase in business lending in April was driven by CBA, which chalked up 29-percent growth in the space month-on-month, according to the latest regulatory data.

Nearly two thirds of Australian banks balance sheets are exposed to mortgages, where growth has been consistently slowing following a series of regulatory steps to contain rocketing house prices in Sydney and Melbourne.

Bank shares are among the worst performers on the benchmark Samp;P/ASX index this year, down between 8.5 percent and 10 percent. The benchmark is largely unchanged. ($1 = 1.3731 Australian dollars) (Reporting by Swati Pandey; Editing by Joseph Radford)