Again, I digress from Web Analytics, to talk about current events outside Analytics - but which Analytics could be applied to.

I am happy to see that Conseratives and Liberals, Right and Left, Republicans and Democrats, - no one likes the $700 Billion Bailout Plan proposed by the Bush Administration - even though everyone agrees on some type of radical action needs to be taken now.

Paul Krugman’s Cash for Trash OPED in today’s New York Times displays an understanding of the current financial situation and his ability to simplify it into 4 steps (almost like the 4 stomachs of Cows); by being able to conceptualize this Wall Street Meltdown into a series of steps with sequences he’s displaying the best skills of a Web Analyst - the ability to take complex information and synthesize it into a working model.

I believe, making sense of the data, what Paul Krugman does, is the one fundamental skill all Web Analysts need - the ability to use synthesis to take a complex situation and derive insight into it.

Even if you don’t agree with Paul Krugman the $700 Billion Bailout Plan if too flawed to pass in anywhere near it’s current form, at least you can get a sense of understanding, of empowerment even, by reading his OPED on Cash for Trash.

Here’s Paul Krugman’s 4 step analytics summary of current dire economic predicament the United States is in; Krugman thinks instead of bailing out Wall Street firms at step 4, with no accountability, we should be giving them more liquidity at step 2, in return for part ownership.

I just want to point out, again, the importance of forming a “working model” of a situation from which you can then preform analysis - if you can not conceptualize a problem, then any solution (ie: Secretary of the Treasury Paulson’s solutions, for example) are little better than throwing darts at the dart board (problem), and in the dark.

” … So let’s try to think this through for ourselves. I have a four-step view of the financial crisis:

1. The bursting of the housing bubble has led to a surge in defaults and foreclosures, which in turn has led to a plunge in the prices of mortgage-backed securities — assets whose value ultimately comes from mortgage payments.

2. These financial losses have left many financial institutions with too little capital — too few assets compared with their debt. This problem is especially severe because everyone took on so much debt during the bubble years.

3. Because financial institutions have too little capital relative to their debt, they haven’t been able or willing to provide the credit the economy needs.

4. Financial institutions have been trying to pay down their debt by selling assets, including those mortgage-backed securities, but this drives asset prices down and makes their financial position even worse. This vicious circle is what some call the “paradox of deleveraging.”

“….. The logic of the crisis seems to call for an intervention, not at step 4, but at step 2: the financial system needs more capital. And if the government is going to provide capital to financial firms, it should get what people who provide capital are entitled to — a share in ownership, so that all the gains if the rescue plan works don’t go to the people who made the mess in the first place.”

And, even arch conservative William Kristol does not like the Bush Administration’s $700 Billion financial Bailout Plan, and most conservatives don’t like it either - for much the same reasons that Krugman does not like it - it’s bailing out the wrong people and has no oversight previsions, making the Treasury Secretary too much power.  William Kristol writes in his New York Times OPED:

“… I’ve been shocked by the number of (mostly conservative) experts I’ve spoken with who aren’t at all confident that the Bush administration has even the basics right — or who think that the plan, though it looks simple on paper, will prove to be a nightmare in practice.”

Of course, Kristol wonder’s if Barack Obama or John McCain have the courage and exhibit the political will to oppose the $700 Billion Bailout Plan with the upcoming Presidential Election around the corner - what if, by opposing the $700 Billion Financial Bailout Plan the economy gets even worse, perhaps going into a deep recession, or even … a depression, then the electorate will blame what ever candidate voted against it.

On the other hand, were Barack or McCain back the current $700 Billion Bailout Plan and it fails quickly, blood would be on their hands, as well - and it could change the outcome of the election.

Using the Analytics approach I mentioned earlier in this post, the synthesis of information into a working model, so that you can then come up with insight and wisdom - the $700 Billion Bailout Plan looks too much like Authorization plan the Bush Administration floated just before it went to War with Iraq - the pressure to quickly “act” and vote - seems to be a familiar tactic that is used by this administration, to force people to act, often out of fear, against their own best interests - because they don’t realize, with the rush to act, what interests are actually being compromised.

We do need to do something quickly - but not that quickly - perhaps not even before the upcoming election .

We should, I think, work towards a solution and try to contain the damage on Wall Street and in the Global Financial Markets, but without giving the Treasury Secretary a blank check to do whatever he wants.

I also enjoyed reading Roger Cohen’s  Fleecing America in the New York Times OPED section tonight - Cohen brings another perspective - that United States is no longer the predominant Economic Super Power and that, primarily, under the Bush Administration, the bulk of what was once our Wealth, has moved off shore, to China, Russia and India. .. and the joke is on us - though Krugman was warning about this day for the last 5 years, last I counted - and the joke is on us - all of us - now that reality is setting in.

Not only that, but he somehow brings in sales for the disgusting artwork of Damien Hirst - the guy who puts dead large Sharks in formaldehyde, just like this one at the Metropolitan Museum of Art; here’s part of a story about this artwork in Time Magazine in a story tiled “A Shark’s Tale”

Damien Hirst’s pickled shark, formally known as The Physical Impossibility of Death in the Mind of Someone Living, has been presented as a three year loan by its owner, the hedge fund billionaire Steven A. Cohen, to no less a grand lady than the Metropolitan Museum of Art in New York.

And to think, this is the same Met whose trustees used to be touchy —granted, it was long ago — about admitting Picassos into the collection.”

In case you missed it, the age of America as the dominant financial power - gone.  Read this (you can agree with it, or not, but even if you don’t agree - then come up with something better to explain what’s going on):

“…. It’s that the Hirst bull market in the midst of the most convulsive week for financial markets since 1929 says something important about the global economy and America’s declining place in it. In case you missed it, Hirst sold 223 works last week for just over $200 million, well above Sotheby’s pre-auction estimate.

Oliver Barker, the auctioneer, identified the Russians as major buyers. Sotheby’s took a preview of the sale to New Delhi, where it received a number of pre-auction bids. Jose Mugrabi, a New York dealer, told my colleague Carol Vogel that Hirst is a “global artist” who can defy “local economies.”

For local, read American.

Anyway, a post script. In his piece for Bloomberg News that I’ve linked to above, Martin Gayford notes that the same Damien Hirst is asking 50 million pounds — $100 million — for his new diamond encrusted skull.

Sounds like the “diamond encrusted skull” of Damien Hirst won’t be sold to anyone around here - unless Treasury Secretary Paulson has his way and gets his and G.W. Bush’s  $700 Billion Bailout Plan approved by Congress - then maybe, maybe, some Wall Street Bank or Financial Instituion will have the money to throw at Damien Hirst and buy the diamond encrusted skull - and put it next to “The Bull” on Wall Street (Nah, maybe Goldman Sach’s will buy it with TaxPayer’s money and display the skull in their lobby.

But seriously, just about everyone thinks the $700 Billion Wall Street Bailout Plan is too flawed to pass in it’s current form.  Hopefully, the pressure to “do something now” will not be successfully exploited, as it has in the past, to stick us all with a bill we don’t want or, for a fact, need.

And while I’m at it - I said the other day I would provide an “influencer” list from Radian6 surrounding the the $700 Billion Bailout Plan - here it is.

And here’s a link to the entire file - knock yourself out - but note the Huffington Post seems to be on top of almost any political story, including this one.  Could it be the Huffington Post is “more influential” for this discussion on $700 Billion Dollar Bailout than the New York Times?  Beats me.

Finally, here’s a series of Topic Clouds from Radian6 on the $700 Billion Dollar Financial Bailout and how it varies by media:

Blogs only:

Blogs tend to focus on discussing the government “plan” to buy the distressed securities while letting the Financial Institutions that got us into this mess, off the hook.

Online Videos Only -

Online Videos focus more on the size of the Bailout - based on the Topic Cloud Meta-data:

Main Stream Media -

Twitter - Micro Media

Interestingly, the Topic Cloud for Twitter is much more useful than the others, from my point of view as it contains some of the TinyURL’s that are being shared online over the last day.  I think, and maybe Radian6 needs to figure out a way to do this - a way to work URLs into the Topic Clouds are needed, in general.

At least, here they happen, with Twitter, due to the nature of the content and the size of a micro post.

For example, the stories that are being talked about in Twitter are “Bush administration wants $700 billion for Wall St. bailout” with the “size” of the bailout being most notable - also the use of slang missing from the other Topic Clouds shown.

Forums

Well, that’s about it for this long, long post.

I expect Monday and Tuesday to be filled with a lot more turmoil as Congress and Online News Media take a closer look at the the $700 Billion Bailout Plan - but I hope we just don’t find ourselves back in 2003, when Bush called the shots and we ended up going into Iraq due to faulty information.