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03 Sep 20:55

Elon Musk's growing empire is fueled by $4.9 billion in government subsidies

Adam Victor Brandizzi

Dinheiro bem investido, eu diria.

Los Angeles entrepreneur Elon Musk has built a multibillion-dollar fortune running companies that make electric cars, sell solar panels and launch rockets into space.

And he's built those companies with the help of billions in government subsidies.

Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.

"He definitely goes where there is government money," said Dan Dolev, an analyst at Jefferies Equity Research. "That's a great strategy, but the government will cut you off one day."

The figure compiled by The Times comprises a variety of government incentives, including grants, tax breaks, factory construction, discounted loans and environmental credits that Tesla can sell. It also includes tax credits and rebates to buyers of solar panels and electric cars.

A looming question is whether the companies are moving toward self-sufficiency — as Dolev believes — and whether they can slash development costs before the public largesse ends.

Tesla and SolarCity continue to report net losses after a decade in business, but the stocks of both companies have soared on their potential; Musk's stake in the firms alone is worth about $10 billion. (SpaceX, a private company, does not publicly report financial performance.)

Musk and his companies' investors enjoy most of the financial upside of the government support, while taxpayers shoulder the cost.

The payoff for the public would come in the form of major pollution reductions, but only if solar panels and electric cars break through as viable mass-market products. For now, both remain niche products for mostly well-heeled customers.

Musk declined repeated requests for an interview through Tesla spokespeople, and officials at all three companies declined to comment.

The subsidies have generally been disclosed in public records and company filings. But the full scope of the public assistance hasn't been tallied because it has been granted over time from different levels of government.

New York state is spending $750 million to build a solar panel factory in Buffalo for SolarCity. The San Mateo, Calif.-based company will lease the plant for $1 a year. It will not pay property taxes for a decade, which would otherwise total an estimated $260 million.

The federal government also provides grants or tax credits to cover 30% of the cost of solar installations. SolarCity reported receiving $497.5 million in direct grants from the Treasury Department.

That figure, however, doesn't capture the full value of the government's support.

Since 2006, SolarCity has installed systems for 217,595 customers, according to a corporate filing. If each paid the current average price for a residential system — about $23,000, according to the Union of Concerned Scientists — the cost to the government would total about $1.5 billion, which would include the Treasury grants paid to SolarCity.

Nevada has agreed to provide Tesla with $1.3 billion in incentives to help build a massive battery factory near Reno.

The Palo Alto company has also collected more than $517 million from competing automakers by selling environmental credits. In a regulatory system pioneered by California and adopted by nine other states, automakers must buy the credits if they fail to sell enough zero-emissions cars to meet mandates. The tally also includes some federal environmental credits.

On a smaller scale, SpaceX, Musk's rocket company, cut a deal for about $20 million in economic development subsidies from Texas to construct a launch facility there. (Separate from incentives, SpaceX has won more than $5.5 billion in government contracts from NASA and the U.S. Air Force.)

Subsidies are handed out in all kinds of industries, with U.S. corporations collecting tens of billions of dollars each year, according to Good Jobs First, a nonprofit that tracks government subsidies. And the incentives for solar panels and electric cars are available to all companies that sell them.

Musk and his investors have also put large sums of private capital into the companies.

But public subsidies for Musk's companies stand out both for the amount, relative to the size of the companies, and for their dependence on them.

"Government support is a theme of all three of these companies, and without it none of them would be around," said Mark Spiegel, a hedge fund manager for Stanphyl Capital Partners who is shorting Tesla's stock, a bet that pays off if Tesla shares fall.

Tesla stock has risen 157%, to $250.80 as of Friday's close, over the last two years.

Musk has proved so adept at landing incentives that states now compete to give him money, said Ashlee Vance, author of "Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future," a recently published biography.

"As his star has risen, every state wants a piece of Elon Musk," Vance said.

Before his current ventures, he made a substantial sum from EBay Inc.'s $1.5-billion purchase of PayPal, the electronic payment system in which Musk held an 11% stake.

Soon after, he founded SpaceX in 2002 with money from that sale, and he made major investments and took leadership posts at Tesla and Solar City.

Musk is now the chief executive of both Tesla and SpaceX and the chairman of SolarCity, and holds big stakes in all three, including 27% of Tesla and 23% of SolarCity, according to recent regulatory filings. The ventures employ about 23,000 people nationwide, and they operate or are building factories and facilities in California, Michigan, New York, Nevada and Texas.

Tense talks

The $1.3 billion in benefits for Tesla's Nevada battery factory resulted from a year of hardball negotiations.

Late in 2013, Tesla summoned economic development officials from seven states to its auto factory in Fremont, Calif. After a tour, they gathered in a conference room, where Tesla executives explained their plan to build the biggest lithium-ion battery factory in the world — then asked the states to bid for the project.

Nevada at first offered its standard package of incentives, in this case worth $600 million to $700 million, said Steve Hill, Nevada's executive director of the Governor's Office of Economic Development.

Tesla negotiators wanted far more. The automaker at first sought a $500-million upfront payment, among other enticements, Hill said. Nevada pushed back, in sometimes tense talks punctuated by raised voices.

"It would have amounted to Nevada writing a series of checks during the first couple of years," said Hill, calling it an unacceptable risk.

With the deal imperiled, Hill flew to Palo Alto in August to meet with Tesla's business development chief, Diarmuid O'Connell, a former State Department official who is the automaker's lead negotiator.

They shored up the deal with an agreement to give Tesla $195 million in transferable tax credits, which the automaker could sell for upfront cash. To make room in its budget, Nevada reduced incentives for filming in the state and killed a tax break for insurance companies.

Nevada Gov. Brian Sandoval and Musk sealed the agreement in a Labor Day phone conversation. Hill said it was worth it, pointing to the 6,000 jobs he expects the factory to eventually create.

The state commissioned an analysis estimating the economic impact from the project at $100 billion over two decades, but some economists called that figure deeply flawed. It counted every Tesla employee as if they would otherwise have been unemployed, for instance, and it made no allowance for increased government spending to serve the influx of thousands of local residents.

A $750-million factory

Musk has similar success with getting subsidies for a SolarCity plant in Buffalo, N.Y. The company currently buys many of its solar panels from China, but it will soon become its own supplier with a new and heavily subsidized factory.

An affiliate of New York's College of Nanoscale Science and Engineering in Albany will spend $750 million to build a solar panel factory on state land. SolarCity estimated in a corporate filing that it will spend an additional $150 million to get the factory operating.

When finished in 2017, the 1.2-million-square-foot facility will be the largest solar panel factory in the Western Hemisphere. New York officials see the subsidy as a worthy investment because they expect that it will create 3,000 jobs. The plant will replace a long-closed steel factory.

"The SolarCity facility will bring extensive benefits and value to this formerly dormant brownfield that provided zero benefit to the city and region," said Peter Cutler, spokesman for Empire State Development, New York's economic development agency.

SpaceX, though it depends far more on government contracts than subsidies, received an incentive package in Texas for a commercial rocket launch facility. The state put up more than $15 million in subsidies and infrastructure spending to help SpaceX build a launch pad in rural Cameron County at the southern tip of Texas. Local governments contributed an additional $5 million.

Included in the local subsidies is a 15-year property tax break from the local school district worth $3.1 million to SpaceX. Officials say the development still will bring in about $5 million more over that period than the local school district otherwise would have collected.

"That's $5 million more than we have ever seen from that property," said Dr. Lisa Garcia, superintendent of the Point Isabel Independent School District. "It is remote.... It is just sand dunes."

Crucial aid

The public money for Tesla and SolarCity factories is crucial to both companies' efforts to lower development and manufacturing costs.

The task is made more urgent by the impending expiration of some of their biggest subsidies. The federal government's 30% tax credit for solar installations gets slashed to 10% in 2017 for commercial customers and ends completely for homeowners.

Tesla buyers also get a $7,500 federal income tax credit and a $2,500 rebate from the state of California. The federal government has capped the $7,500 credit at a total of 200,000 vehicles per manufacturer; Tesla is about a quarter of the way to that limit. In all, Tesla buyers have qualified for an estimated $284 million in federal tax incentives and collected more than $38 million in California rebates.

California legislators recently passed a law, which has not yet taken effect, calling for income limits on electric car buyers seeking the state's $2,500 subsidy. Tesla owners have an average household income of about $320,000, according to Strategic Visions, an auto industry research firm.

Competition could also eat into Tesla's public support. If major automakers build more zero-emission cars, they won't have to buy as many government-awarded environmental credits from Tesla.

In the big picture, the government supports electric cars and solar panels in the hope of promoting widespread adoption and, ultimately, slashing carbon emissions. In the early days at Tesla — when the company first produced an expensive electric sports car, which it no longer sells — Musk promised more rapid development of electric cars for the masses.

In a 2008 blog post, Musk laid out a plan: After the sports car, Tesla would produce a sedan costing "half the $89k price point of the Tesla Roadster and the third model will be even more affordable."

In fact, the second model now typically sells for $100,000, and the much-delayed third model, the Model X sport utility, is expected to sell for a similar price. Timing on a less expensive model — maybe $35,000 or $40,000, after subsidies — remains uncertain.

"Some may question whether this actually does any good for the world," Musk wrote in 2008. "Are we really in need of another high-performance sports car? Will it actually make a difference to global carbon emissions? Well, the answers are no and not much.... When someone buys the Tesla Roadster sports car, they are actually helping to pay for the development of the low-cost family car."

Next: Battery subsidies

Now Musk is moving into a new industry: energy storage. Last month, he starred in a typically dramatic announcement of Tesla Energy-branded batteries for homes and businesses. On a concert-like stage, backed by pulsating music, Musk declared that the batteries would someday render the world's energy grid obsolete.

"We are talking about trying to change the fundamental energy infrastructure of the world," he said.

Musk laid out a vision of affordable clean energy in the remote villages of underdeveloped countries and homeowners in industrial nations severing themselves from utility grids. The Nevada factory will churn out the batteries alongside those for Tesla cars.

What he didn't say: Tesla has already secured a commitment of $126 million in California subsidies to companies developing energy storage technology.

jerry.hirsch@latimes.com

Twitter: @latimesjerry

Copyright © 2015, Los Angeles Times
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03 Sep 18:03

TBT



TBT

03 Sep 17:10

Free Stuff and Naps

Conference Guy: Here's your headphones and your soft pillow! Conference room A is for napping. Conference room B is for quietly hacking while soft electronica plays.
187

Free Stuff and Naps - Sept. 3, 2015, 9 a.m.

There are at least two interpretations of this joke. Either all developers are lying to all project managers, and developer conferences are secretly just a mini-vacation for devs. OR This developer conference with the pillows and the soft music is a true developer conference - but it is too beautiful to exist in the real world. I think it is equally funny either way. conferences

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03 Sep 05:00

Na fronteira

Um tiroteio na fronteira entre a Venezuela e a Colômbia acendeu o pavio da mais recente crise internacional de nossa vizinhança.

De olho nas eleições de dezembro, Nicolás Maduro esticou a corda. Denunciou os cidadãos colombianos como fonte de criminalidade e contrabando, expulsando mil deles do país. Outros 5.000 saíram com medo. Se a situação piorar, há risco de uma grave crise humanitária.

O problema é artificial e, como todos sabem, manter a fronteira fechada é insustentável porque aquela é uma área de enorme dinamismo econômico. Além disso, 4 milhões de colombianos vivem na Venezuela, gerando um caldo de insatisfação difícil de controlar. Até dezembro, porém, Maduro não tem incentivo algum para reverter as coisas. Sua aposta é arriscada porque uma escalada de violência nunca é fácil de conter.

Se errar na mão, pode reprisar o filme de Galtieri, o general argentino que se lançou à conquista das Malvinas.

Nessas circunstâncias, o governo colombiano assiste à crise de mãos atadas. O presidente Juan Manuel Santos investiu muito na aproximação com a Venezuela e, agora, uma reversão poderia feri-lo nas eleições que enfrentará no próximo dia 25 de outubro.

Santos ainda padece de falta de apoio externo.

Anteontem, ele não conseguiu obter o apoio da OEA e, ontem, ficou claro que a Unasul tampouco virá a seu resgate de modo decisivo.

Para Santos, a opção factível é empurrar com a barriga até dezembro, pedindo aos céus para que a violência contra cidadãos colombianos não chegue ao ponto de forçá-lo a reagir.

Qual o papel do Brasil nessa história?

No Planalto, ninguém esconde exasperação com a diplomacia venezuelana. Os adjetivos utilizados para caracterizá-la não cabem nas páginas deste jornal, que é lido por toda a família. No entanto, ninguém em Brasília está disposto a entrar na briga. Ouve-se que fazê-lo poderia deteriorar o relacionamento com Caracas às vésperas de uma difícil eleição e até mesmo insuflar Maduro ainda mais.

Isso dito, há medidas específicas que o governo brasileiro pode tomar em repúdio sutil à patacoada venezuelana. O cenário ideal para tanto é a visita oficial de Dilma à Colômbia, em 5 de outubro próximo.

A presidente pode pousar em Bogotá com dois acordos hoje emperrados do lado brasileiro –um sobre comércio fronteiriço e outro sobre direito de residência.

Ela ainda pode assinar um ambicioso instrumento de facilitação de investimentos, que está quase pronto.

Acima de tudo, pode chegar bem preparada para responder às perguntas inconvenientes que lhe farão sobre o espinhoso aliado venezuelano.

03 Sep 01:17

Photo



03 Sep 12:40

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25 Aug 12:00

HOW TO FAIL AT THE INTERNET!

by WrongMan
02 Sep 21:37

What A Connected World

by Oliver Widder
02 Sep 20:30

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03 Sep 07:06

The Flare and the Galaxy

Discover the cosmos! Each day a different image or photograph of our fascinating universe is featured, along with a brief explanation written by a professional astronomer.

2015 September 2
See Explanation.  Clicking on the picture will download
 the highest resolution version available.

The Flare and the Galaxy
Image Credit & Copyright: Martin Mark

Explanation: Is this person throwing a lightning bolt? No. Despite appearances, this person is actually pointing in the direction of a bright Iridium flare, a momentary reflection of sunlight off of a communications satellite in orbit around the Earth. As the Iridium satellite orbits, reflective antennas became aligned between the observer and the Sun to create a flash brighter than any star in the night sky. Iridium flares typically last several seconds, longer than most meteors. Also unlike meteors, the flares are symmetric and predictable. The featured flare involved Iridium satellite 15 and occurred over southern Estonia last week. In this well-planned image, a spectacular night sky appears in the background, complete with the central band of our Milky Way Galaxy running vertically up the image center.

Retrospective: Today in APOD History
Tomorrow's picture: open space < | Archive | Submissions | Index | Search | Calendar | RSS | Education | About APOD | Discuss | >

Authors & editors: Robert Nemiroff (MTU) & Jerry Bonnell (UMCP)
NASA Official: Phillip Newman Specific rights apply.
NASA Web Privacy Policy and Important Notices
A service of: ASD at NASA / GSFC
& Michigan Tech. U.

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02 Sep 21:04

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01 Sep 22:00

How to Prove Which of You Is the Evil Twin

by Scott Meyer

Ha! 2003! There it is folks, documentary evidence that PROVES that I've disliked Adam Sandler since before it was cool!

In an unrelated note, I never realized before this moment how much the gunman in this comic reminds me of Jack Ruby. That was not deliberate.

You can comment on this comic on Facebook.

As always, thanks for using my Amazon Affiliate links (USUKCanada).

02 Sep 03:18

Blythe Masters Tells Banks the Blockchain Changes Everything - Bloomberg Business

Adam Victor Brandizzi

Banqueiros empolgados com blockchain. Faz todo sentido.

The penthouse meeting room in Le Parker Meridien hotel in midtown Manhattan is humming with chatter on this June afternoon. About a hundred money managers are networking at the end of the day at a Sandler O’Neill & Partners investor conference as the green rectangle of Central Park stretches into the distance 42 floors below. With neckties loosened and icy drinks in hand, the attendees largely ignore the founder of a fintech startup who’s presenting a PowerPoint about his investing smartphone app. But when the next guest takes the floor, the room falls silent.

These Wall Street veterans all know who Blythe Masters is. She’s the wunderkind who made managing director at JPMorgan Chase at age 28, the financial engineer who helped develop the credit-default swap and bring to life a market that peaked at $58 trillion, in notional terms, in 2007. She’s the banker later vilified by pundits, unfairly some say, after those instruments compounded the damage wrought by the subprime mortgage crash in 2008. Now, one year after quitting JPMorgan amid another controversy, Blythe Masters is back. She isn’t pitching a newly minted derivative or trading stratagem to this room. She’s promoting something wilder: It’s called the blockchain, and it’s the digital ledger software code that powers bitcoin.

Masters is the CEO of Digital Asset Holdings, a New York tech startup. She says her firm is designing software that will enable banks, investors, and other market players to use blockchain technology to change the way they trade loans, bonds, and other assets. If she’s right, she’ll be at the center of yet another whirlwind that will change the markets.

“You should be taking this technology as seriously as you should have been taking the development of the Internet in the early 1990s,” Masters, a lithe 46-year-old Englishwoman with auburn hair and the proper diction of the Home Counties, explains to the rapt audience. “It’s analogous to e-mail for money.”

That’s a bold statement, but Masters isn’t the only voice heralding the coming of the blockchain. The Bank of England, in a report earlier this year, calls it the “first attempt at an Internet of finance,” while the Federal Reserve Bank of St. Louis hails it as a “stroke of genius.” In a June white paper, the World Economic Forum says, “The blockchain protocol threatens to disintermediate almost every process in financial services.”

In a matter of months, this word, blockchain, has gone viral on trading floors and in the executive suites of banks and brokerages on both sides of the Atlantic. You can’t attend a finance conference these days without hearing it mentioned on a panel or at a reception or even in the loo. At a recent blockchain confab in London’s hip East End, the host asked if there were any bankers in the room. More than half the audience members, all dressed in suits, raised their hands.

Now, everyone’s trying to figure out whether the blockchain is just so much hype or if Masters’s firm and other startups are really going to change the systems that process trillions of dollars in securities trades. When investors buy and sell syndicated loans or derivatives or move money around the world, they must cope with opaque and clunky back-office processes that rely on negotiated contracts between buyers and sellers, lots of phone calls, lots of lawyers, and even the occasional fax. It still takes almost 20 days, on average, to settle syndicated loan trades.

Masters is betting that the blockchain, the breakthrough that permits people to buy and sell bitcoins without the need for an intermediary, can be used to streamline all manner of financial transactions. A June report backed by Santander InnoVentures, the Spanish bank’s fintech investment fund, estimated the blockchain could save lenders up to $20 billion annually in settlement, regulatory, and cross-border payment costs.

“You have front-end systems trading at warp speed, and nanoseconds of competitive advantage are being extracted, and yet the back end of Wall Street hasn’t been fundamentally overhauled in decades,” Masters says in an interview at her offices in Manhattan’s Flatiron District. “Firms are dealing with greater requirements for reporting, transparency, and dissemination of data. Costs have gone up and revenues have gone down. This technology really gets to the core of all those issues.”

That’s why there’s been a Cambrian explosion of blockchain startups, accelerators, and skunkworks in London, New York, and Silicon Valley. In April, UBS installed a half dozen developers in London’s Level39 accelerator to download blockchain source code from the Internet and delve into how it might revolutionize payments, cybersecurity, and other banking needs. Barclays, Goldman Sachs, the New York Stock Exchange, and Santander are backing cryptocurrency ventures. And no surprise, Marc Andreessen, Jim Breyer, Reid Hoffman, and other denizens of Sand Hill Road are all over this space. Venture capitalists plowed $400 million into dozens of digital currency startups in the first six months of this year, a fourfold jump from all of 2013, according to industry news site CoinDesk.

Some of these ventures are building on the actual bitcoin blockchain. In June, Nasdaq teamed up with Chain, a San Francisco firm, and launched a project to use the blockchain to issue and transfer the equity shares of closely held companies on the exchange’s private marketplace. “The blockchain is going to bring levels of efficiency to the financial markets that we’ve never seen before,” says Nasdaq CEO Bob Greifeld. “In time, it could be as impactful on the back office as electronic trading was on open outcry.” 

By contrast, Ripple Labs, another San Francisco company, runs a self-contained network for financial institutions that doesn’t rely on bitcoin at all. Masters plans to offer banks and other financial players both options: Digital Asset is creating an off-the-shelf private blockchain product and developing ways to connect its customers to the existing bitcoin system.

Whatever form it takes, the blockchain has the potential to change the very structure of the financial services industry, says Oliver Bussmann, the chief information officer at UBS. “If you brought up bitcoin with bankers 12 months ago, you’d lose their attention immediately,” Bussmann says. “Now, everyone sees this as a critical topic. I know of more than 100 firms that are trying to make the blockchain more scalable, more secure, to make the one that everybody will use. There’s a race on out there.”

Maybe so, but rewiring the market’s infrastructure is an awfully big task. So is persuading financial players to place their trust in a system embraced by cryptocurrency anarchists and other fringy characters. Even if market pros do grasp the blockchain’s potential, will they buy in?

“Look, the technology is potentially great, but you’re going to have to bring along all the regulators and the banks to change the ecosystem,” says Hank Uberoi, the former co-head of Goldman Sachs’s global technology operations and now the CEO of Earthport, a London-based payments venture. “Change comes very slowly in that world. That’s going to be the hardest part.”

When it comes to adopting innovation, the financial services industry doesn’t exactly have a stellar record. For example, the global interbank payments system, which Uberoi’s Earthport is trying to shake up, is managed by a consortium of more than 10,000 institutions. It’s so antiquated that it still takes days to send transactions from one part of the world to another. Jon Matonis, a founding director of the Bitcoin Foundation, a Washington group that promotes the cryptocurrency, says a private blockchain run by banks could end up as just “another cartel” and function as poorly as the payments consortium. 

Masters had a hard time believing Digital Asset's Sunil Hirani was serious when he first talked to her about bitcoin.

Photographer: Guzman/Bloomberg Markets

Blythe Masters swings open the door of her ninth-floor offices, parks her suitcase, and exhales. Fresh off a flight from London, she’s relieved to be back on solid ground. Masters says her airliner was landing when it suddenly roared back into the sky to avoid a collision on the runway. “That’s the most dangerous moment I’ve ever had on a plane!” says Masters, who’s dressed in a black knit tunic, black tights, and Burberry-plaid flats.

Her new digs at Digital Asset Holdings, with a worn wooden floor and views of air shafts, are a far cry from the Park Avenue executive suite at JPMorgan. The glass walls are covered in scribbled pieces of code and diagrams with a lot of boxes and arrows. A gray terrier named Luna, the office pooch, scampers under the conference room table. A guest notes that Nasdaq has just hired a “blockchain technology evangelist.” “We have a blockchain artist,” Masters replies, pointing out the one decorative object in the place, a painting depicting a network of black and blue lines. “That is our COO’s homegrown work,” she says with delight. “I rather like it.”

Born in Oxford and educated in economics at Cambridge, Masters came of age at JPMorgan. At 18, she joined its London office as an intern during a year off before university. By her mid-20s, Masters was working on the bank’s derivatives team in New York. She helped design a way to remove lending risk from JPMorgan’s balance sheet by getting another party to protect the bank against a default in return for a premium. The contract, which made it possible to bet a bond would fall in value, was dubbed a credit-default swap, and investors fell in love with it. In 1999, Masters, then 30, was named head of the bank’s global credit derivatives unit.

“Blythe has about as much wrapped up in one brain as I’ve ever encountered in finance,” says John “Mac” McQuown, co-founder of KMV, a maker of widely used credit analysis tools. McQuown, 81, has known Masters since the early 1990s. “She is inventive, a risk taker, and beyond a doubt a force to be reckoned with.”

Masters advanced quickly up JPMorgan’s ranks. Following a stint as CFO of its global investment bank from 2004 to 2007, she was appointed chief of a newly formed unit that helped clients manage risk in commodities markets. During the next five years, she built it into a profitable business that oversaw billions of dollars of physical assets. At the same time, Masters served as a board member and then chair of the Securities Industry and Financial Markets Association, known as SIFMA. Along the way, she earned a reputation as that rare figure on the Street, a corporate player with the innovative chops of an entrepreneur.

“You were one of the most powerful women on Wall Street,” CNBC host Bob Pisani noted during an onstage interview with Masters at a fintech conference in June.

“What do you mean I was?” Masters deadpanned.

After the fall of Lehman Brothers in September 2008, some media outlets highlighted her work with credit derivatives and cast her as one of the instigators of the crash. She became such a target of critics that a French graffiti artist spray-painted her likeness onto the wall of a museum called the Abode of Chaos near Lyon.

In a speech that year at SIFMA’s annual conference in New York, she noted that she’d been dubbed “The Woman Who Built Financial Weapons of Mass Destruction.” She responded to the swipes by saying the problem wasn’t the instrument but the way people used it. “Unfortunately, tools that transfer risk can also increase systemic risk if major counterparties fail to manage their risk exposures properly,” she said.

JPMorgan CEO Jamie Dimon backed her all the way through this period, but her fortunes turned in 2013, when the Federal Energy Regulatory Commission investigated whether traders in her commodities division manipulated California’s electricity market. JPMorgan paid a $410 million settlement to end the case without denying or admitting wrongdoing; Masters wasn’t implicated in the matter. Dimon agreed to sell the business to a Swiss trading firm called Mercuria Energy Group in March 2014, and Masters resigned.

For the first time in her career, she had nowhere to be and nothing to do except hang out with her husband and daughter in her Tribeca townhouse, catch up with friends, and pursue her passion for show jumping. Masters has won first-place ribbons riding her two beloved European warmblood horses, Aslan and Vamos.

Then one day that summer, she grabbed breakfast with Sunil Hirani, an entrepreneur who co-founded Creditex Group, one of the first CDS brokerages. Hirani, 48, an effusive man who’s made a fortune at the intersection of technology and derivatives, couldn’t stop talking about bitcoin. He was toying with the idea of creating futures contracts around the ersatz currency. He was also forming a startup, Digital Asset, to explore how to apply the blockchain to the markets. He’d teamed up with Don Wilson, the founder and CEO of DRW Trading Group, a Chicago-based market maker and trading firm.

Masters was surprised. Hirani was a shrewd Street vet. He’d sold Creditex for $513 million to Intercontinental Exchange in 2008. Why was he messing around with a technology associated with cypherpunks and anti-Fed libertarians? Wasn’t the currency’s price cratering amid scandals involving bitcoin-lubricated online drug bazaars and bankrupt bitcoin exchanges? “Can’t we talk about something more serious?” Masters pleaded with her old friend.

Hirani knew that Masters’s knowledge of the inner workings of the markets would make her the ideal person to build the firm he envisaged and to sell this new technology to Wall Street. So he persuaded Masters to do some homework. Over the next few weeks, she delved into bitcoin’s origins and discussed its potential with Hirani and his colleagues as well as her network of regulators and market players. 

Photographer: Guzman/Bloomberg Markets

So what, exactly, is this thing that sounds like something you’d build with Lego pieces? Like many innovations in finance these days, the blockchain is code.

In 2009, a mysterious coder named Satoshi Nakamoto released bitcoin and the math that makes it work on the Internet. He (or she or they—Nakamoto has yet to be identified) created a peer-to-peer network to enable people to buy and sell bitcoins and to automatically secure and perpetuate the system. Every 10 minutes, coders around the world known as miners race to be the first to solve mathematical equations and record transactions made with bitcoins as entries, or blocks, on a digital ledger. In return for their work, which requires brute force computing power to complete, the program rewards miners with bitcoins, which motivates them to process transactions faster.

Here’s the key part: Every new block is connected to every prior one in a digital chain. So the record of every bitcoin transaction lives on the computers of the miners and is updated with each new entry. That’s why the blockchain is also called a distributed or a decentralized ledger. This replication makes the blockchain secure. The only way to tamper with it would be to seize control of most of the computers holding the blockchain in their memories, which miners call the “51 percent attack.” Such an assault has a better chance of materializing in the next Bond flick than in reality, says Matonis, who’s also an editorial board member at CoinDesk.

As Masters dug deeper into bitcoin, she learned that it was just one of many applications that could run on the blockchain. Startups in London, Silicon Valley, and even Mexico City were already developing ways to use it to transfer and record land titles, airline miles, gold, and diamonds. Masters realized that bitcoin wasn’t really about bitcoin—it was all about the blockchain. “I had an aha moment,” Masters says.

She then plumbed why the ledger could transmit assets without an intermediary, which would change everything she knew about the way the markets completed trades. Buyers and sellers, of course, can’t automatically trust one another. In the fixed-income market, for example, we need middlemen to draw up contracts between buyers and sellers that cover interest payments, terms, and collateral, plus clearinghouses to guarantee the exchange of cash for securities.

Through her research, Masters understood how you could input all that information into a digital “smart contract” on a distributed ledger. Conceptually, it’s similar to the way you can embed video in an e-mail. But the difference is that when you send that smart contract along, it doesn’t just contain data, it transfers ownership of the security. The value belongs to whoever possesses it. So a trade could be settled in minutes instead of days or weeks, Hirani says.

Anyone with access to the ledger can read the contract with a click of a mouse. That means regulators, who depend primarily on self-regulatory organizations to police the markets, could easily verify that a securities transaction didn’t violate anti-money-laundering rules or other laws. The blockchain, in essence, automates trust, Hirani says.

The clincher for Masters was how the technology can affect risk. Every hour that a trade hangs suspended between sale and purchase, the chances mount that it won’t be fulfilled, she says. Institutions have to set aside capital to protect themselves from such failures. Since the 2008 crash, regulators in the U.S. and the European Union have directed banks to allocate ever-larger sums to cover their exposures. If the blockchain could shorten the settlement time for, say, syndicated loans, from 20 days to 10 minutes, this risk would be reduced and capital would be freed up.

“I spent my whole career thinking about risk, markets, infrastructure, and regulation,” Masters says. “I had seen the financial crisis unfold, and I had seen the credit derivatives market get operationally ahead of itself, which resulted in systemic risk counterparty exposures. I began to believe that distributed ledgers had the capability to tackle that problem.”

In March, Masters joined Digital Asset as CEO. She, Hirani, and Wilson set to work developing blockchain-based software for three inefficient markets they deemed ripe for an overhaul: syndicated loans, U.S. Treasury repos, and equity shares in private companies. At the same time, Masters recognized that the open structure of the bitcoin process—no one controls who does the mining—would be anathema to an industry in which client confidentiality is sacrosanct. So in July, the company acquired Hyperledger, a San Francisco software firm that’s developing the technological equivalent of gated communities. Its system is designed so that users will be able to process transactions themselves rather than depend on the open bitcoin blockchain.

“With private chains, you can have a completely known universe of transaction processors,” Masters says. “That appeals to financial institutions that are wary of the bitcoin blockchain.”

While this vision of a superefficient financial world is enticing, let’s not forget that Masters and her rivals will have to persuade institutions and regulators to uproot decades of legacy IT systems and practices. And the introduction of the blockchain will make the markets’ infrastructure even more complex than it already is, at least in the short term.

Skeptics question whether one piece of code could in a single stroke make finance faster, more transparent, and more efficient. “People are talking about how the blockchain is going to be some kind of Messianic savior for the database industry,” says Bradley Howard, the head of digital media at Endava, a London-based IT services provider. “It may be fantastic in some cases, but it could also just be the latest fad.”

Yet Masters, who in July joined the board of Santander’s U.S. unit as nonexecutive chairman, is betting that the mindset at the highest levels of finance is changing. The advent of peer-to-peer lending, mobile banking, and other innovations is forcing Wall Street’s chieftains to rethink their businesses. She says the blockchain may be the biggest fintech play of them all.

“Blythe sees that a new industry is being created,” says Hirani, who’s known Masters for 17 years. “There’s no infrastructure. There’s no companies that have any kind of scale. She’s done the bank thing. She did commodities. She did derivatives. She did loan portfolio management. This allows her to bring all of that experience to bear in creating an ecosystem—and a company around it.”

Twenty-three years ago, Masters opened up fresh territory with credit derivatives. Now, she’s determined to do it again, although this time it’s with a technology that was initially designed to bypass the financial system. Masters, with a very British dose of understatement, puts it this way: “I’ve always been motivated to innovate where the implications are significant.”

This story appears in the October issue of Bloomberg Markets magazine. 

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02 Sep 01:42

breezingby: curvethemoonshine: wow The Connection!!!



breezingby:

curvethemoonshine:

wow

The Connection!!!

02 Sep 05:31

http://ffffound.com/image/4e35eefd255590bbc4b1e0f9b2ebb30a8514cc3b

by jess
01 Sep 00:00

xkcd Survey

The xkcd Survey: Big Data for a Big Planet
02 Sep 12:44

Distant Neutrinos Detected Below Antarctic Ice

Discover the cosmos! Each day a different image or photograph of our fascinating universe is featured, along with a brief explanation written by a professional astronomer.

2015 September 1
See Explanation.  Clicking on the picture will download
 the highest resolution version available.

Distant Neutrinos Detected Below Antarctic Ice
Image Credit: IceCube Collaboration, U. Wisconsin, NSF

Explanation: From where do these neutrinos come? The IceCube Neutrino Observatory near the South Pole of the Earth has begun to detect nearly invisible particles of very high energy. Although these rarely-interacting neutrinos pass through much of the Earth just before being detected, where they started remains a mystery. Pictured here is IceCube's Antarctic lab accompanied by a cartoon depicting long strands of detectors frozen into the crystal clear ice below. Candidate origins for these cosmic neutrinos include the violent surroundings of supermassive black holes at the centers of distant galaxies, and tremendous stellar explosions culminating in supernovas and gamma ray bursts far across the universe. As IceCube detects increasingly more high energy neutrinos, correlations with known objects may resolve this cosmic conundrum -- or we may never know.

Astrophysicists: Browse 1,100+ codes in the Astrophysics Source Code Library
Tomorrow's picture: open space < | Archive | Submissions | Index | Search | Calendar | RSS | Education | About APOD | Discuss | >

Authors & editors: Robert Nemiroff (MTU) & Jerry Bonnell (UMCP)
NASA Official: Phillip Newman Specific rights apply.
NASA Web Privacy Policy and Important Notices
A service of: ASD at NASA / GSFC
& Michigan Tech. U.

Expanded from APOD by Feed Readabilitifier.
02 Sep 12:26

The real horror.image | twitter | facebook









The real horror.

image | twitter | facebook

02 Sep 16:00

nohighs: BALMUNG 2015-16 Autumn Winter



nohighs:

BALMUNG 2015-16 Autumn Winter

02 Sep 16:47

the-weird-wide-web: “ I’m 87 years old…I only eat so I can smoke and stay alive.. The only fear I...

Adam Victor Brandizzi

"The only fear I have is how long consciousness is gonna hang on after my body goes."

Então não sou só eu.

the-weird-wide-web:

“ I’m 87 years old…I only eat so I can smoke and stay alive.. The only fear I have is how long consciousness is gonna hang on after my body goes. I just hope there’s nothing. Like there was before I was born. I’m not really into religion, they’re all macrocosms of the ego. When man began to think he was a separate person with a separate soul, it created a violent situation.

The void, the concept of nothingness, is terrifying to most people on the planet. And I get anxiety attacks myself. I know the fear of that void. You have to learn to die before you die. You give up, surrender to the void, to nothingness.

Anybody else you’ve interviewed bring these things up? Hang on, I gotta take this call….. Hey, brother. That’s great, man. Yeah, I’m being interviewed… We’re talking about nothing. I’ve got him well-steeped in nothing right now. He’s stopped asking questions.“ 

~ HARRY DEAN STANTON

02 Sep 16:31

Coder discussion

02 Sep 14:06

scrappadoir: Judge — September 1925



scrappadoir:

Judge — September 1925

02 Sep 13:30

aagdolla: Twins at Afro Punk 2015 by aagdolla



aagdolla:

Twins at Afro Punk 2015

by aagdolla

02 Sep 18:02

parl–calmer: soundsof71: FULL ALERT: LIFESIZE DAVID BOWIE...







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soundsof71:

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Handcrafted from high quality printed fabric that is silky soft to the touch and backed with sturdy broadcloth, this tribute to David Bowie’s famous Ziggy Stardust costume is an utterly unique addition to any Bowie fan’s home.

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02 Sep 13:58

O príncipe e os súditos - 02/09/2015 - Opinião - Folha de S.Paulo

Bernardo Mello Franco

BRASÍLIA - Herdeiro da maior empreiteira do país, o executivo Marcelo Odebrecht é conhecido pelo apelido de príncipe. Nesta terça, ele deixou a prisão para ser cortejado por um diligente grupo de súditos: os deputados da CPI da Petrobras.

O depoimento se transformou em uma ação entre amigos. Os inquisidores pareciam concorrer para ver quem elogiava mais o empresário, que responde a ação penal por corrupção, lavagem de dinheiro e formação de organização criminosa.

"Senhor Marcelo, é a primeira vez que tenho a oportunidade de estar pessoalmente no mesmo ambiente que o senhor", desmanchou-se Altineu Côrtes (PR-RJ). Depois, ele disse conhecer empregados da Odebrecht que sentem "profundo orgulho" do patrão. Só faltou pedir autógrafo.

Valmir Prascidelli (PT-SP) formulou uma pergunta curiosa ao investigado. "O sr. acha adequada e correta a sua prisão, considerando que sempre se colocou à disposição da Justiça?" Odebrecht retribuiu, sensibilizado: "Agradeço muito as perguntas que o sr. está fazendo, porque elas seriam as minhas respostas".

Delegado Waldir (PSDB-GO), que na véspera chamara José Dirceu de "ladrão", parecia outra pessoa. "Parabéns, eu também me orgulho muito do meu pai", disse, quando o empreiteiro citou o patriarca Emilio.

Outro tucano, Bruno Covas (PSDB-SP), se mostrou compreensivo quando o réu se recusou a responder perguntas: "Não precisa pedir desculpas, até porque é um direito seu".

É elogiável que os deputados façam perguntas em tom educado. Mas o excesso de mesuras ficou constrangedor até para os padrões da CPI, que tem se empenhado em proteger réus e perseguir delatores da Lava Jato.

No fim, Carlos Andrade (PHS-RR) quis saber se o executivo continua a defender o financiamento privado de campanhas. Em 2014, o grupo Odebrecht doou R$ 918 mil a deputados da CPI. "Sou a favor, sempre fui", respondeu o príncipe encarcerado. Os súditos pareceram respirar aliviados.

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25 Aug 20:26

Pictured: Brazil's bizarre £500-a-night luxury 'love motels'

Adam Victor Brandizzi

What is bizarre about them?

  • Owners of cheap and seedy motels in Brazil have turned the establishments into extravagant, high-end 'love hotels'
  • They offer couples helicopter flights over Sao Paulo, champagne-fuelled limousine rides before they get to the room
  • Over-the-top rooms come with everything from water-flume which drops into a jacuzzi to your very own personal DJ 
  • Brazil's 'love motels' first emerged in the 1960s when low-income couples had no privacy in their cramped homes

Brazil's new generation of luxurious 'love motels' come with anything from a water-flume which drops into a jacuzzi to a spinning bed underneath disco lights - as your personal DJ plays a set just for you.

The country's infamous motels have for years been known as cheap, and often seedy, places for couples to spend the night.

They have now being rebranded to entice the country's elite, who are willing to spend big money on 'sexual experiences'.

In Brazil's financial centre of Sao Paulo, high-end motels offer couples intimate helicopter flights over the city and champagne-fuelled cruises in blacked-out limousines before they even reach their rooms.

Luxurious: In the Harmony motel in Brazil, couples  can slide down a water flume (pictured) into a heated bath

Luxurious: In the Harmony motel in Brazil, couples can slide down a water flume (pictured) into a heated bath

Extravagant: The Harmony motel is one of several Brazilian 'love hotels' which were once considered seedy, but now cater to the country's elite couples

Extravagant: The Harmony motel is one of several Brazilian 'love hotels' which were once considered seedy, but now cater to the country's elite couples

Adults only: The Harmony motel holds 11 large suites across 4,200square-metres and its designs are based on the Far East

Adults only: The Harmony motel holds 11 large suites across 4,200square-metres and its designs are based on the Far East

Disco lights: The newest room at the Harmony is the Nagoya Suite (pictured) where a king-size bed sits in the middle of a nightclub-style bedroom

Disco lights: The newest room at the Harmony is the Nagoya Suite (pictured) where a king-size bed sits in the middle of a nightclub-style bedroom

Loaded: Most rooms in the Harmony come with some sort of extravagant water feature, such as a jacuzzi, and a widescreen television is never far away

Loaded: Most rooms in the Harmony come with some sort of extravagant water feature, such as a jacuzzi, and a widescreen television is never far away

Fully stocked: The Lush Splash, an 'exuberant and unique suite' which comes with a heated pool, will set you back £85-a-night

Fully stocked: The Lush Splash, an 'exuberant and unique suite' which comes with a heated pool, will set you back £85-a-night

Groovy: When Brazil's 'love motels' first emerged in the 1960s to serve low-income couples who had no privacy in their cramped homes, they were much more basic than the exuberance of the Lush (pictured)

Groovy: When Brazil's 'love motels' first emerged in the 1960s to serve low-income couples who had no privacy in their cramped homes, they were much more basic than the exuberance of the Lush (pictured)

Oriental: Items included in the package for the Nagoya room (pictured) at the Harmony are rose petals, two decorative oriental fans on the bed, four candlesticks with scented candles, champagne and chocolates

Oriental: Items included in the package for the Nagoya room (pictured) at the Harmony are rose petals, two decorative oriental fans on the bed, four candlesticks with scented candles, champagne and chocolates

Fantasy: Lush Motel's Spa room comes with bizarre bed designs and a bathroom equipped with a jacuzzi and a 40in LED TV

Fantasy: Lush Motel's Spa room comes with bizarre bed designs and a bathroom equipped with a jacuzzi and a 40in LED TV

They are then dropped off in fantasy bedrooms fitted out with everything from jukeboxes to boxing rings, play areas and 4D cinemas.

In some suites, you can pretend you are in ancient Egypt or Rome, or among the mythical Amazons with themed bedrooms, complete with lifelike statues, waterfalls and real jungle flora.

And in one of the South American city's most daring establishments, you can even hire your own personal DJ who play a set just for you and your date.

Such extravagance does not come cheap and the entire experience could set you back more than £500, compared to just £5-an-hour for a standard motel room.

Brazil's love motels first appeared in the 1960s as a vital service for low-income couples who had no privacy in their cramped homes, as well as a discreet place where men could take their lovers and prostitutes.

They are now an ever-present part of Brazilian society. 

Set the mood: Rooms in Motel Lush (pictured), in Sao Paulo's central Cambuci district, cost up to £85 per night for the Spa Splash room

Set the mood: Rooms in Motel Lush (pictured), in Sao Paulo's central Cambuci district, cost up to £85 per night for the Spa Splash room

Soothing: Inside the 60 different themed suites at the Lush Motel, guests can get in the mood with private saunas, hydro-massage pools with waterfalls (pictured)

Soothing: Inside the 60 different themed suites at the Lush Motel, guests can get in the mood with private saunas, hydro-massage pools with waterfalls (pictured)

Retro: Motel Lush's Splash Spa room (pictured) comes with a heated pool with waterfall, outdoor area with sunroof, sauna and wine cellar

Retro: Motel Lush's Splash Spa room (pictured) comes with a heated pool with waterfall, outdoor area with sunroof, sauna and wine cellar

Private: Guests at the Lush can get in the mood with  a dance floor with a stripper's pole (pictured), bubble-chairs and soothing couple's 'chromotherapy' showers

Private: Guests at the Lush can get in the mood with  a dance floor with a stripper's pole (pictured), bubble-chairs and soothing couple's 'chromotherapy' showers

Special day: Mr Martinez, owner of Lush (pictured), says most of the couples who visit the motel are celebrating their anniversary or a significant event - not those who want to have illicit sex

Special day: Mr Martinez, owner of Lush (pictured), says most of the couples who visit the motel are celebrating their anniversary or a significant event - not those who want to have illicit sex

Trendsetter: Luxury motels like the Lush (pictured)   are springing up all around Sao Paulo - each catering for different niches and tastes

Trendsetter: Luxury motels like the Lush (pictured)   are springing up all around Sao Paulo - each catering for different niches and tastes

Felipe Martinez, 31, co-owner of the Motel Lush, in Sao Paulo's central Cambuci district, explains: 'The idea is to offer to our clients an experience in which they almost feel like they are in a parallel universe, not in a motel bedroom.

'The sex is not the most important part. It is the whole experience, the couple's moment of intimacy together. We don't sell sex, we sell experiences.'

Founded in 1990, the Lush has offered the same service as the city's countless other love motels - a basic bedroom, rented by the hour, where couples could go to have sex.

But this year the new owners decided to follow a number of similar establishments and, after a £1.5million face-lift, reopened last month offering luxury packages designed to help wealthy men sweep their beaus of their feet.

For £300, couples can take an hour-long cruise through the city streets in a Ferrari, Porsche, Mustang, Camaro or Dodge Challenger, or a half-an-hour helicopter ride over Sao Paulo's landmarks.

It costs £370 for a limousine, replete with champagne, which will pick up them up and take them on a private two-hour tour of the city until finally leaving them at the entrance to your chosen suite at the motel. 

Behind closed doors: Most modern Brazilian love motels like the Lush (pictured) are designed around the couple's secrecy

Behind closed doors: Most modern Brazilian love motels like the Lush (pictured) are designed around the couple's secrecy

Secret: Clients can drive into private garages and rotating hatches deliver food and condoms without guests and staff ever having to meet

Secret: Clients can drive into private garages and rotating hatches deliver food and condoms without guests and staff ever having to meet

Flashy: From more minimalist rooms to ones which surround the bed in green neon lights (pictured), the Lush caters to many different tastes

Flashy: From more minimalist rooms to ones which surround the bed in green neon lights (pictured), the Lush caters to many different tastes

Good service: For £370, couples get a limousine which will take them on a two-hour tour of Sao Paulo before leaving them at the entrance of their chosen suite at the Lush (pictured)

Good service: For £370, couples get a limousine which will take them on a two-hour tour of Sao Paulo before leaving them at the entrance of their chosen suite at the Lush (pictured)

Refurbished: The owners of the Lush Motel decided to follow the lead of several other 'love motels' and gave their establishment a £1.5million face-lift

Refurbished: The owners of the Lush Motel decided to follow the lead of several other 'love motels' and gave their establishment a £1.5million face-lift

Inside the 60 different themed suites at the Lush, guests can get in the mood with private saunas, hydro-massage pools with waterfalls, a dance floor with a stripper's pole, bubble-chairs and soothing couple's 'chromotherapy' showers.

And in the Cine 4D suite, couples can watch over 100 adult movies in a special 4D cinema, sitting on special motion seats which move and vibrate along with whatever is going on in the film.

Similar luxury motels which are springing up all around Sao Paulo, each catering for different niches and tastes.

At the Acaso Motel in the western district of Vila Prudente, one suite allows couples to release pent-up energy with a boxing bag which hangs from the middle of the room, complete with two pairs of boxing gloves.

In another, couples can sip Veuve Clicquot Brut champagne and dine on lamb rack with Dijon mustard while relaxing in a hydro-massage bath covered by gold-plated tiles - all for £200.

In the Harmony motel, on the eastern side of Sao Paulo, lovers can zoom down a water flume into a heated bath. 

Rebranded: Before its £1.5million face-lift,  the Lush (pictured) offered the same service as the city's countless other love motels - a basic bedroom, rented by the hour, where couples could go to have sex

Rebranded: Before its £1.5million face-lift,  the Lush (pictured) offered the same service as the city's countless other love motels - a basic bedroom, rented by the hour, where couples could go to have sex

While staying at the Lush, couples can pay £300, couples for an hour-long cruise through the city streets in a Ferrari, Porsche, Mustang, Camaro or Dodge Challenger

While staying at the Lush, couples can pay £300, couples for an hour-long cruise through the city streets in a Ferrari, Porsche, Mustang, Camaro or Dodge Challenger

Out of this world: The co-owner of the Motel Lush (pictured) says: 'The idea is to offer to our clients an experience in which they almost feel like they are in a parallel universe'

Out of this world: The co-owner of the Motel Lush (pictured) says: 'The idea is to offer to our clients an experience in which they almost feel like they are in a parallel universe'

The £50 room is, says the establishment, 'ideal for couples who like to explore different types of fun between four walls.'

The newest room to be unveiled at the Harmony is the Nagoya Suite, where a king-size bed is situated in the middle of a nightclub-style dance floor, with a laser light show and huge 12-screen video wall.

Guests who don't mind sharing their intimate rendezvous can even hire a DJ to provide a personal musical backdrop to their lovemaking.

The suite, which costs just £73 a night without the DJ, has three floors on which there is also a snooker table, an aquarium, pinball machines, a pole dance pole, a swimming pool with waterfall and a hydro-massage bath. 

Brazil's 'love motels' are designed for secrecy. Clients drive straight into private garages connected to the suites, while rotating hatches in rooms deliver food and condoms without guests and staff ever having to make eye contact.

Mr Martinez, owner of Lush, claims that since upgrading his establishment the number of customers has more than doubled - and most are no longer people who just want a room to have illicit sex.

He says: 'Most of the people who come here are couples who are celebrating something, an anniversary or special event. They are those people who are wanting an experience they will remember, not just a bed and an hour to have sex and then leave.'

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30 Aug 05:00

A letalidade da roubalheira do Carf

A Operação Zelotes, conduzida pelo Ministério Público e pela Polícia Federal, está comendo o pão que o Tinhoso amassou. Ela começou em março e explodiu uma quadrilha de ex-conselheiros, parentes e amigos de conselheiros que vendiam decisões do Conselho Administrativo de Recursos Fiscais, um órgão do Ministério da Fazenda. Depois de dois anos de investigações sigilosas e 2.300 horas de escutas telefônicas, foram cumpridos 41 mandados de busca e apreensão.

Passados na peneira, separaram-se 74 processos com cheiro de queimado, todos de peixes gordos. Num grampo autorizado pela Justiça, um ex-conselheiro disse o seguinte: "Aqui no Carf só os pequenos devedores pagam. Os grandes, não". Ou, noutra versão, mais crua: "Quem não pode fazer acordo, acerto –não é acordo, é negociata– se fode".

A coisa funcionava assim há muitos anos: uma grande empresa ou um grande banco era autuado em R$ 100 milhões pela Receita Federal, recorria ao Carf e liquidava a fatura reduzindo a autuação para algo como R$ 5 milhões.

Essa modalidade de corrupção é muito mais daninha do que tudo que se viu na Lava Jato. Num raciocínio cínico, a tia de um empreiteiro que cobrou R$ 100 milhões por uma obra que valia R$ 50 milhões, sempre poderá dizer que, apesar de tudo, a obra do seu sobrinho está lá. Já a tia de um magano que alugava por R$ 150 milhões um navio-sonda que o mercado oferece por R$ 100 milhões também dirá que o navio está no litoral de Campos, fazendo seu serviço.

No caso do Carf, a empresa que devia R$ 100 milhões pagou R$ 5 milhões à Receita e uns R$ 3 milhões à quadrilha. Só se produziu prejuízo e propina. Nem refinaria, muito menos navio-sonda.

Coisas estranhas aconteceram com a Operação Zelotes. Quando ela foi desencadeada, o juiz Ricardo Leite, da 10ª Vara Federal de Brasília, julgou desnecessário prender pelo menos quatro acusados, contentando-se com os mandados de busca e apreensão. Jogo jogado. Em junho, o Ministério Público pediu e conseguiu seu afastamento.

Noutra ponta, saiu da Câmara dos Deputados um pedido de informações com algumas perguntas banais ao Ministério da Fazenda: Quais os valores de cada processo milionário julgado no Carf? Quais recursos foram aceitos? Em junho, o doutor Carlos Alberto Freitas Barreto, presidente do Conselho, informou que devido a uma mudança no sistema de armazenamento de dados esse detalhamento só poderia ser apresentado "em breve". Passaram-se três meses e nada.

Numa nova surpresa, o coordenador-geral de investigação da Receita Federal, Gerson Schaan, deu uma entrevista à repórter Andreza Matais na qual disse o seguinte: "O que a quadrilha fazia era direcionar o julgamento para uma Turma que tinha entendimento a favor do contribuinte. Trata-se de um caso de corrupção, não de sonegação". Em tese, tudo bem; na prática, a ver. O centro dessa questão só será mais bem entendido "em breve", quando o Carf fulanizar nomes e cifras.

Nos pixulecos do Carf podiam ocorrer três situações:

1) O contribuinte sabia que estava sonegando e dava a pedalada tributária porque esperava ganhar a parada no Carf. Nesse caso há corrupção e sonegação.

2) O contribuinte pode ter razão, mas comprou o "direcionamento". A Receita errou, mas falta explicar melhor como uma Turma entende uma coisa e outra vai na direção oposta, sobretudo sabendo-se, há anos, que uma quadrilha orientava o trânsito. Nesse caso, há um atravessador corrupto e um empresário corruptor.

3) No pior dos casos, o contribuinte tinha razão, mas foi informado de que iria para a lâmina se não pagasse o pedágio. Segundo um dos integrantes da quadrilha: "Se eu participar (...) eles têm mais ou menos 95% de chances de ganhar. Caso contrário, perderão, com certeza".

Essas diferenças poderão ser esclarecidas se a Operação Zelotes entrar no estilo da Lava Jato. Pelo andar da carruagem, apesar dos esforços da Polícia Federal e do Ministério Público, ela está devagar, quase parando.

Corre o risco de ficar parecida com a Castelo de Areia, aquela que livrou a empreiteira Camargo Corrêa de qualquer suspeita. Passaram-se seis anos e agora a empresa está colaborando com o juiz Sergio Moro.

GREVES EM ESCOLAS

Uma história para hierarcas que cortam despesas e professores ou servidores que fazem greves duradouras, capazes de arruinar a vida dos alunos:

Lucy Maria Degli Espositi Pereira tem 29 anos, mora na roça de Bom Jesus do Itapaboana (RJ). Viveu num convento e, aos 27 anos, voltou a estudar, à noite. Em 2013, ganhou uma das medalhas de ouro da Olimpíada de Matemática das Escolas Públicas e ficou entre as 200 melhores do país. Em 2014, levou uma medalha de prata. Na primeira fase do concurso deste ano acertou 16 das 20 questões.

Sua mãe trabalha como merendeira numa escola, o pai vende o leite de umas poucas vacas e, com ela, faz serviços de pedreiro.

Desde junho, Lucy não vai à escola, por falta de transporte, pois os motoristas dos ônibus estão em greve por falta de pagamento.

Em tempo: Na escola Alfredo Leppaul, de Santa Leopoldina (ES), o município onde vivem as famosas trigêmeas medalhistas da Olimpíada, os alunos ficaram sem aulas de matemática por falta de professor.

EREMILDO, O IDIOTA

Eremildo é um idiota e acredita que ninguém quer destruir o governo da doutora Dilma, ele é que se autodestrói. O Planalto conseguiu um tempo para respirar, não há manifestações de rua no calendário e a oposição está sem rumo. Diante da calma, apareceu um çábio:

"Vamos recriar um imposto."

E assim renasceu a tentativa de ressurreição da CPMF, o imposto do cheque.

Seria o caso de se retomar a proposta de cobrança pelo atendimento do SUS. Assim o sujeito que aguenta uma carga tributária de 35% adoece, vai a um hospital público, paga com um cheque e toma outra tunga.

PRECIOSIDADE

O Instituto Cultural Amilcar Martins, de Belo Horizonte, acaba de publicar "Livraria Mineira", um rico volume com seu catálogo. São cerca de 10 mil títulos relacionados à história e os costumes de Minas Gerais. Tem de tudo, desde a primeira edição de poemas do inconfidente Cláudio Manuel da Costa e um volume de 1749, narrando as curas milagrosas da Lagoa Santa, até uma coletânea de receitas de doces mineiros, publicada em 1932.

A proeza foi conseguida pelo historiador Amilcar Martins Filho, que começou a coleção nos anos 70. Além do livro, um cartapácio de quase três quilos, a boa notícia está no fato de o instituto ter colocado o conteúdo na rede, bem como suas belas ilustrações.

É comum que edições desse tipo fiquem restritas às poucas pessoas que têm acesso a versões impressas. Martins rompeu essa escrita. O livro e o catálogo estão disponíveis para quem quiser, de graça.

JATO QUE NÃO LAVA

A seção paulista da Ordem dos Advogados do Brasil cassou a carteira de José Dirceu por 76 votos contra dois.

Achou que o comissário ofendeu os princípios éticos da guilda pelos crimes que cometeu em 2005, que levaram-no à cadeia em 2012.

Como demoraram três anos para tomar a decisão, de duas uma: ou não leem jornais ou, quem sabe, alguém achava que Dirceu não estava morto.

LÁ VEM MAIS

Quem lê os horóscopos do ministro Teori Zavascki (signo de Leão) desconfia que há depoimentos de colaboradores com informações cujo sigilo ainda deve ser preservado, para não atrapalhar investigações em curso.

01 Sep 21:40

Blue Fire Crater: Rivers of Molten Sulphur Flowing Inside an Indonesian Volcano Photographed by Reuben Wu

by Christopher Jobson

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While on a trip to visit the Ijen and Bromo Tengger Semeru volcanoes in East Java last month, Chicago-based photographer Reuben Wu captured the unusual sight of molten sulphur that flows from fumaroles at the base of the Blue Fire Crater at Ijen. The area is usually swarming with tourists, but Wu stayed after sunset until the moon rose to capture these otherworldly images.

The journey into the Ijen Caldera is not for the faint hearted. A two-hour trek up the side of the rocky volcano is followed by another 45-minute hike down to the bank of the crater. The blue fire found at the base is the result of ignited sulphuric gas that burns up to 600 degrees Celsius (1,112 degrees Fahrenheit) and can flare up to 5 meters (16 feet) into the air. It is the largest “blue flame” area on Earth.

Additional photos from Wu’s trek through Indonesia can be seen here. (via Colossal Submissions)

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01 Sep 16:00

"Oh, hey, I just discovered my operating system is 32 bits!"

“Oh, hey, I just discovered my operating system is 32 bits!”

- Somebody not happy anymore
01 Sep 18:55

Unquote

by Greg Ross

“All my life I wanted to be somebody, but now I see I should have been more specific.” — Lily Tomlin

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