EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

05.22.18

Saint-Germain’s Poisonous Legacy of “Toxic Loans”: The Emperor’s New Investment Guidelines

Posted in Europe, Patents at 10:18 pm by Dr. Roy Schestowitz

“Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done.”

John Maynard Keynes, “The General Theory of Employment, Interest and Money,” Chapter 12: The State of Long-Term Expectation

Emperor's new clothes

Summary: Details about a secret vote to ‘gamble’ the EPO’s budget on “a diversified portfolio managed by external experts”

In a document dated 24 November 2017 (CA/F 18/17 Rev. 1) the current and soon-to-depart Emperor or “Sun-King” of the European Patent Office, Mr Battistelli, presented the Administrative Council with a proposal for “New Investment Guidelines of the European Patent Office”. (warning: epo.org link; see local copy [PDF])

“The official record shows that of the 32 delegates present, only 6 voted against, 2 abstained and the remaining 24 voted in favour.”According to information from EPO insiders the proposal was rubber-stamped with almost indecent haste by the Budget and Finance Committee of the EPO’s Administrative Council in December 2017. See SUEPO Den Haag publication. [PDF]

The official record shows that of the 32 delegates present, only 6 voted against, 2 abstained and the remaining 24 voted in favour.

An interesting detail here is that the matter was decided by means of a secret vote which was apparently requested by the Italian delegation.

More recently, EPO insiders report (see above) that at the last meeting of the BFC, which took place in Munich on 16 and 17 May, Mr Battistelli’s proposal to invest the EPO’s whopping cash surplus of around € 2.3 billion in the newly established “treasury investment fund” was also approved by a large majority of the delegations with only one vote against by the German delegation.

Soon after the adoption of the New Investment Guidelines in December 2017, a contributor to the Kluwer Patent Blog voiced his concern about certain aspects of the guidelines and he expressed the view that the permitted range of exotic “financial instruments” “appears to be unnecessarily extensive”.

“An interesting detail here is that the matter was decided by means of a secret vote which was apparently requested by the Italian delegation.”These concerns were echoed in March 2018 by another regular contributor to the Kluwer Patent Blog, Dr. Thorsten Bausch, who noted that the EPO “literally sits on a heap of money; so much money that the President has written (warning: epo.org link; see local copy [PDF]) to the AC’s Budget and Finance Committee, asking them to liberalize the Investment Guidelines, so that the EPO can start investing in more exciting financial instruments such as currencies, derivative instruments, asset-backed securities (ABS), mortgage-backed securities (MBS), Credit Default Swaps (CDS) or in summary: ‘a diversified portfolio managed by external experts’.

Bausch recommended his readers “to study this document in full” and noted that it had already been critically discussed in the earlier January posting on the Kluwer Patent Blog. He shared the concerns expressed by the previous contributor and opined that “the experiences of Harvard University and others in 2008/2009 should be a lesson to all of us.”

“Mr Battistelli’s proposal to invest the EPO’s whopping cash surplus of around € 2.3 billion in the newly established “treasury investment fund” was also approved by a large majority of the delegations with only one vote against by the German delegation.”If Dr. Bausch was looking for cautionary tales in such matters he need not have ventured so far afield across the Atlantic to Harvard.

A quick glance over the Franco-German border into the political “backyard” of the Deputy Mayor for culture in St. Germain-en-Laye would have been sufficient to alert readers to the risks of dabbling in the kinds of exotic and exciting “financial instruments” foreseen in the Emperor’s New Investment Guidelines.

We think that it could be instructive to have a closer look at the SIDRU “toxic loan” débâcle in St. Germain-en-Laye.

“We think that it could be instructive to have a closer look at the SIDRU “toxic loan” débâcle in St. Germain-en-Laye.”Our aim is to encourage a more critical approach on the part of all stakeholders including the general public to current attempts to (mis)use EPO funds for speculative gambling in the global casino of the international financial markets.

We hope that a careful and diligent study of the cautionary tale which follows will yield a “prudential” dividend for all those who make the effort to digest the details.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

What Else is New


  1. Links 27/6/2019: Valve-Ubuntu Reconciliation, GNOME Usage Gets More Useful at Reporting Disk Space

    Links for the day



  2. Links 25/6/2019: Mesa Releases, Less Microsoft in Apache

    Links for the day



  3. The European Patent Office Remains a Crooked Patent Office That Harms Staff and Abolishes the Rule of Law

    The EPO remains a sordid mess, but those who follow mainstream media might not know anything about it because it's not covered anywhere in 2019



  4. USPTO and EPO Faking Growth by Granting Patents on Everything in Nature, But Campaigners Strike Back

    The patent microcosm is eating the world; everything under the Sun must be patented, they insist, even life itself (so they can 'pirate' the Commons and then charge us a tax for 'access' or 'license' to it)



  5. IBM Happy That Patent Quality at EPO Collapsed and It's Easy to Get Software Patents

    The EPO keeps granting illegal European Patents and the media almost never mentions this illegality because it's in too amicable a relationship (typically financial) with the EPO



  6. The Linux Foundation's Staff Uses Windows and Microsoft. Now the Foundation Outsources the Coding and Hosting, Too (to Microsoft of Course).

    The disturbing turns of the self-described "Linux" Foundation, which seems to be promoting proprietary software and even Microsoft rather than Linux and Free/Open Source software while the role or capacity of Torvalds is being gradually diminished



  7. Links 25/6/2019: Raspberry Pi 4, Ubuntu's Change of Mind, Wayland’s Weston 6.0.1

    Links for the day



  8. Patent Extremism: Stacking the Panels, the Surveys, the Hearings, the Debates

    Projection tactics would have the public believe that those who oppose corruption are simply radicals; patent polarity has come to the point where if one isn't a "true believer" in blackmail (patent trolls) or opposes bribery, then one is simply a "fringe" and akin to terrorists



  9. Links 24/6/2019: Linux 5.2 RC6, Skrooge 2.20.0, ZFS vs. OpenZFS

    Links for the day



  10. The EPO Needs a President Who Obeys the Law, Not One Who Obeys Battistelli

    Succession based on nepotism at Europe's second-largest institution served to shown how inherently broken things had become and why cover-up of injustices is nowadays paramount (not fixing the flaws/ills but merely perpetuating them)



  11. With Water (Treatment) Already Patented It Won't Take Long for Patents (and Patent Royalties) on Air

    A 'paper economy' is what Europe turns into if the current trajectory is followed (led by lawyers, not producers)



  12. Bill Gates Said He Was on a “Jihad” Against GNU/Linux, But GNU/Linux Users/Developers Engaged in Self-Defense Are Foul-Mouthed 'Microsoft Haters'?

    Microsoft, which routinely commits very serious crimes, tries to come across as some sort of philanthropy whereas those who share their work with the public (for greater good) are described as erratic, rude and unworthy of respect from corporations (outcasts basically, deprived of income source)



  13. What Patents the EPO Has Just Awarded (With a Special Reward), Not Just Granted

    The EPO's practice of elevating some patents over the other patents (European Patents) is perhaps more of a societal liability than the EPO cares to realise



  14. Required Reading: Mental State of Team Battistelli/Campinos

    On the heels of yesterday's article about Team Battistelli/Campinos, here are some recommended/required papers on the problem which likely plagues the Office



  15. Links 23/6/2019: Wine 4.11, FreeBSD 11.3 RC2

    Links for the day



  16. Microsoft Apparently Did a Patrick Durusau on Wim Coekaerts to Broaden Its Control Over GNU/Linux

    Microsoft tactics for defection and takeover of the competition (without coming across as hostile) aren't new tactics; internal documents from Microsoft explain how to achieve this



  17. EPO Directors Would be Wise to Rebel Against Team Campinos While They Still Have the Job

    As the EPO continues its bold journey towards dictatorship (where presidencies are passed between friends and ‘circles’ are former colleagues or close confidants) Techrights urges those who have power to speak out — e.g. EPO judges and Directors — to do something before it’s too late



  18. American Front Group Open Invention Network (Riding the Linux Brand) is a Proponent of Software Patents in Europe

    The impact of American multinationals in Europe is difficult to deny; in fact, we're observing the same old lobbying/lobbies still working hard albeit more covertly (typically using front groups)



  19. Say 'Hey Hi' to Software Patents

    Using the “AI” (“HEY HI”) hype the ‘community’ of patent maximalists hopes that every little (and possibly very old) algorithm will suddenly sound amazing and innovative — to the point where it becomes unthinkable to deny a patent monopoly on it



  20. A Personal Note From Ted MacReilly (How Microsoft Works Against GNU/Linux)

    A tongue-in-cheek write-up highlighting the ways Microsoft insiders think and how they strategise against GNU/Linux and Free/libre software



  21. The Linux Foundation's New Vice Chair, Wim Coekaerts, Worked for Microsoft

    The Linux Foundation is boosting the Microsoft boosters and calls that "community"



  22. Links 21/6/2019: GNOME 3.33.3, 32-Bit Support Further Neglected, DragonFlyBSD 5.6.1 Released

    Links for the day



  23. Leaked: Harassment of EPO Directors by Team Campinos

    “New BIT organisation and staff changes,” a novel kind of newspeak, means that Directors are being severely punished without due process at all (“hidden disciplinary measure without disciplinary proceedings”)



  24. Patent Professionals in Europe Have Devolved Into a Marketing Industry

    Lies, buzzwords and hype waves is all that the patent bubble in Europe boils down to these days; loads of bogus patents get granted only for European judges to smack these down (if one can afford the court battle)



  25. Almost Six Months After Iancu Said He Would Make Software Patents Great Again Nothing Has Actually Changed

    We're just a fortnight away from the ludicrous plan of Iancu celebrating 6 months (without accomplishing anything)



  26. Links 20/6/2019: Kubernetes 1.15, Alpine 3.10.0 and Librem 5 June Software Update

    Links for the day



  27. Ignore the EPO's Dumb Festival and Focus on the Abuses Against the Workforce and Its Quality of Work

    Don’t lose sight of the appalling behaviour of the management of the EPO; the last thing it wants is press coverage about its gross abuses and corruption — an aspect it spent literally millions of euros to bury (gaming the news cycle)



  28. Microsoft Attempting to Destroy the Careers of Its Critics, Including Free Software Proponents

    Microsoft isn't changing and has not changed; the tactics described above are still being used, even by its "Open Source" (or "Open at Microsoft") people, who did this to me



  29. Links 19/6/2019: Linux Mint Vs Vista 10, Qt 5.13 Released

    Links for the day



  30. The Linux Foundation's Business Model

    The Linux Foundation's plan, illustrated


RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

Recent Posts