Housing and the Debt Pool

Both Australian and the UK are facing a housing bubble with panicy headlines about housing affordability. Fingers are being brazenly pointed at governments and builders. While the actual cause is best described by Ross Gittins of the SMH in his recent article "Housing Crisis: We Did It Ourselves". Summary: greed of current house owners has pushed up the prices.

Various proposals have been made about "fixing" the problem. However, one fact is conveniently ignored. To "fix" the problem, house prices will have to fall. Not really a politicians greatest wish. Releasing more land, re-developing brown sites (particularly in London), reducing the bureaucracy for planning permission, cutting various taxes and changing tax treatment of investments will help the issue. The single biggest problem for politicians is managing the process that will see house prices stall or fall. House prices are invariable driven by demand, if supply meets demand prices won't rise as quickly.

Is that all that can be done? The fixes proposed will do a lot to alleviate the problem in the short to medium term. It will not fix the debt problem that is tied up into the "housing crisis." Instead, we need to look at how debt is managed for consumers. The debt repayments related to buying a house is what causes the stress. Dealing with this requires more than just lowering interest rates.

So how do we deal with the easy debt problem that leads to the payment stress? The total debt any individual needs to be capped based on their cashflow and the interest rates. This includes store cards, car loans, credit cards and all the other methods of debt.

It works by working out a total debt pool of an individual. The individual then gets to choose who and how much debt an individual provider extends to the consumer. The debt pool is calculated from cashflow and the inverse of the interest rate. This way the debt pool enlarges when the interest rate drops and falls when it increases. This will reduce the opportunity for individuals to fall into repayment stress. A buffer between theoretical debt pool and actual available is use to ensure that the individual never progresses beyond the debt pool.

A side effect of this will be that each individual interest rate change will have more effect as not only does it change the repayments an individual has to make it also changes the amount they can borrow.

tags: Housing, Ross Gittins, Debt Management

Perpetual Analytics and policing Social Networks

In what is likely to create a MSM storm, MySpace has deleted profiles of 29,000 convicted sex offenders. As noted by Michael in his post the whole process is complicated by having the data stored in multiple databases. Which will lead louder calls to make on massive DB.

But is one massive DB (and all the problems this may entail) the only effective answer. No, I don't believe so. I think judicious use of perpetual analytics will deliver a more effective solution thatis better at respecting privacy than having one massive DB. The other advantage is that each social network could build on and contribute to the policing of SNS for sex offenders.

tags: Perpetual Analytics, Social Networks, MySpace

Facebook - the next x?

The blogsphere has oscillated between hysteria and backlash against Facebook since the release of the Facebook platform. Some have asked, what is so special about Facebook while others have breathlesssly compared Facebook to Google, Apple & Microsoft.

Now, I personally think the underlying value of Facebook is enormous. However, capturing that value or more accurately realising that value for both the company and users is going to be difficult. More importantly, this will be massively more difficult while people keep talking about Facebook being the next "wunderkin."

Put another way, Facebook is not and never will be Google or Apple or Microsoft or any other wunderkin company. It will be its own wunderkin company that charts a new direction for the industry just as the others have before it. Any punter that talks about Facebook being the next x, will completely and thoroughly miss what Facebook is and will achieve. Do not trust them. These punters are still stuck in the old world and will fail to see the new world.

Truth in advertising - beauty addition

I've wondered for a while whether many beauty magazines and advertisements for beauty products could fall foul of the truth in advertising standards.

The logic is as follows.

Take an image of normal woman. Touch it up and the image is no longer a real representation of the individual. It is no longer true. It is false advertising. The implicit message, particularly of beauty products, is you could look like this if you used the particular product. However, the image is not true. Does this make the advertising untrue?

It would be interesting for such as case to go to Advertising Standards Authority or court.

Tags: Advertising, Policy

The Multi-Touch Revolution

What this video and think about interfaces.

The revolution that the iPhone introduces is not about features and, to a degree, Leopard as well, is around how we interact with information. This is arguer of the coming revolution in IT/internet. The services that win will be the ones that provide the most effective interaction for the user with masses of information.

Remember we are in an age of information. Getting information is not a problem. The problem lies with how we interact with information. How can I, as a user, interact with the information in a way that makes me most effective in achieving my aims, whether it is finding something or manipulating the information.

The multi-touch screen is going to be a huge part of this revolution. Multi-touch opens the door to truly effective manipulation and navigation through complex information environments. That is not to say that the keyboard will die. The keyboard still remains a very effective input device for certain tasks (i.e. word processing). But for other tasks, touch is the way to go. Multi-touch will have more effect on mouse usage as it can directly replace most if not all mouse input functions.

The companies that succeed in this new environment will be ones that make the new input devices and the ones that create software programs or services that most effectively utilise the power of multi-touch. As a thought experiment imagine Google Earth on a large multi-touch screen or Microsoft's Sea Dragon/PhotoSynth combination.

Tags: multitouch, iPhone, UI