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Truth or Fiction: US Army Cannot Count Money

August 24, 2016

I believe everything I read on the Internet. When the information comes from a real journalism type outfit, I am no Doubting Thomas. I wish to point out that the write up “US Army Fudged Its Accounts by Trillions of Dollars, Auditor Finds” strikes me as fiction. Just to keep the math straight, here’s a summary of numbers:

  • 1,000 is one thousand
  • 10,000 is ten one thousands
  • 100,000 is ten ten thousands
  • Let’s jump up a bit.
  • One million is 1,000,000
  • A billion is 1,000,000,000
  • A trillion is 1,000,000,000,000.

In Zimbabwe there was a $10 trillion dollar bill. So misplacing a bill is easy to do:

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My recollection from my days at Booz, Allen is that most humanoids have difficult with quantities over 1,000. Imagine what happens when one has to think about trillions or a one followed by 12 zeros.

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If the write up is on the money, the US Army is composed of individuals who cannot deal with big numbers or money. I learned:

The Defense Department’s Inspector General, in a June report, said the Army made $2.8 trillion in wrongful adjustments to accounting entries in one quarter alone in 2015, and $6.5 trillion for the year. Yet the Army lacked receipts and invoices to support those numbers or simply made them up.

How can a US federal entity make up numbers? The Department of Defense is into Windows and Excel. The US Army has a fancy data aggregation and analysis system called Distributed Common Ground or DCGS-A.

The write up stated:

The report affirms a 2013 Reuters series revealing how the Defense Department falsified accounting on a large scale as it scrambled to close its books. As a result, there has been no way to know how the Defense Department – far and away the biggest chunk of Congress’ annual budget – spends the public’s money. The new report focused on the Army’s General Fund, the bigger of its two main accounts, with assets of $282.6 billion in 2015. The Army lost or didn’t keep required data, and much of the data it had was inaccurate, the IG said.

I was surprised an auditor was able to assemble the needed information. I highlighted this statement from the source article:

The IG report also blamed DFAS [Defense Finance and Accounting Service] , saying it too made unjustified changes to numbers. For example, two DFAS computer systems showed different values of supplies for missiles and ammunition, the report noted – but rather than solving the disparity, DFAS personnel inserted a false “correction” to make the numbers match. DFAS also could not make accurate year-end Army financial statements because more than 16,000 financial data files had vanished from its computer system. Faulty computer programming and employees’ inability to detect the flaw were at fault, the IG said.

Trillions. Hmmm. Why not put DCGS-A on the forensic team? If that system does not work, why not let Palantir Gotham have a go at figuring out where the money went? Another option is IBM i2 Analyst’s Notebook, right?

Yes, government integrity. There’s a Web site for that too: https://www.oge.gov/.

Did you know that?

Stephen E Arnold, August 24, 2016

Thiel and Palantir: Big Play or Not?

August 19, 2016

I read “This Company is Billionaire Peter Thiel’s Biggest Holding.” I am not certain if the write up is a rah rah for a savvy investor or a prognostication about the risks of investment concentration.

The subject is Peter Thiel, investment wizard, and Palantir Technologies. I associate Mr. Thiel with Hulk Hogan, which may be an indication of my own shallowness. I associate Palantir Technologies with its legal dust up with i2 Group (a former client, by the way) and the legal spat with the US Army.

The write up points out:

Late last year, Palantir raised nearly $900 million in a round that valued the company at $20 billion. That makes Palantir the fifth-most valuable start-up in the world, after Uber, Xiaomi, Didi Chuxing, and Airbnb.

That’s good.

But the company may be overvalued. The write up asserts:

If Palantir does go public, it could propel his net worth to new heights.

The write up does not address what happens if Palantir’s value falls and the company does not enter into an initial public offering.

That’s a good question. Perhaps a financial black eye will result? What happens if the legal hassle with US Army is resolved in a way that leaves Palantir Technologies out in the cold?

No answers to these unasked questions. But the write up’s headline is a barn burner even if the information payload is a wet noodle.

Stephen E Arnold, August 19, 2016

LucidWorks Bet on Spark. Now What?

August 8, 2016

Many clear night ago, Lucid Imagination offered an open source enterprise search solution. Presidents came. Presidents went. Lucid Imagination morphed into LucidWorks. I promptly referred to the company in this way: Lucid works, really?

The firm embraced Spark and did a not-unexpected pirouette into a Big Data outfit. I know. I know. Lucid Imagination is a company anchored in key word search, but this is the 21st century. Pirouettes are better than mere pivots, so Big Data it is.

I read “Big Data Brawlers: 4 Challengers to Spark” and the write up triggered some thoughts about LucidWorks. Really.

The point of the story is to identify four open source solutions which do what Spark allegedly does so darned well. Each of these challengers:

  • Scales
  • Handles Big Data (whatever that means)
  • Exploits cheap memory so there are no slug like disc writes
  • Does the old school batch processing thing.

What are the “challengers” to Spark? Here are the contenders:

  • Apache Apex. Once proprietary, now open source, the software does micro batching for almost, sort of real time functions
  • Heron. Another real time solution with spouts and bolts. Excited?
  • Apache Flink. This is an open source library with a one two punch: It does the Flink stuff and the Spark stuff.
  • Onyx. This is a distributed computation system which will appeal to the Java folks.

What do these Spark alternatives have to do with LucidWorks, really? I think there is going to be one major impact. LucidWorks will have to spend or invest in supporting whatever becomes the next big thing. Recommind hit a glass ceiling with its business model. LucidWorks may be bumping into the open source sky light. Instead of being stopped, LucidWorks has to keep investing to keep pace with what the community driven folks generate with little thought to the impact on companies trying to earn a living with open source.

Stephen E Arnold, August 8, 2016

Hewlett Packard: A Future of Uncertainty

August 7, 2016

I read “Private Equity Ponders Hewlett Packard Enterprise Buyout.” I think this is called a tap out in millennial lingo or quitting in less zippy language. I recognize that absolutely everything I read on the Internet is true. Especially Information.

Hewlett Packard has created some of its problems (Board of Directors’ issues, the exciting Autonomy matter, and the great mitosis which saw ink go one way and enterprise services another.) Other problems are external. Who imagined Amazon, the digital Wal-Mart, becoming the big dog in cloud computing. The economy? Well, let’s leave that to the political and economic wizards with MBAs, CPAs, and lawyers, lots of lawyers.

The write up, which I assume is spot on, informed me with information:

Several private equity firms including KKR, Apollo Global Management and Carlyle Group are sniffing around Hewlett Packard Enterprise, contemplating a buyout of the firm, said a person who has had talks with representatives of the firms. Such a deal would be worth more than $40 billion.

What else does the write up assert? I don’t know because after the “exclusive” and the fetching factoid, I have to pony up dough to learn more. My hunch is that the green eyeshade crowd believes that the individual chunks of HPE are worth more than the company in its present form.

Fortune Magazine, once a unit of America Online, knows of what it speaks in “These Private Equity Firms Could Be Looking to Buy Hewlett Packard Enterprise.” No one is exactly sure what’s afoot. I highlighted this passage:

Regardless of the conflicting reports, it seems that HPE is undergoing another significant transformation again.

I like the “transformation” angle. It reminds me of Dr. Daphne Swartz’s lecture in Biology 101 about the caterpillar to butterfly thing. You know a crawly worm with fur becomes a winged creature with nifty scales. These scales impart the color. Otherwise, the butterfly’s wings, like the emperor without clothes, are not much to look at.

What about Autonomy I ask myself? Well, it seems that it is a race to see who will sell the software first. Hewlett Packard seems to be shopping the unit. But if those fun loving green hued folks get their first, some other pavement pounders will get in on the act.

What’s this mean for licensees of Autonomy? The sunk costs can be fascinating. Unlike the colors of the butterfly’s wings, the costs of training, tuning, and maintaining the system can be spectacular.

The turmoil swirling around HPE is chaotic, maybe disruptive. To some, that’s a good thing. To those who just want to find information, the future looks like a furry caterpillar: Ugly and pesticides infuse the stuff the worm eats.

Stephen E Arnold, August 6, 2016

Government IT Procurement Wobble

July 5, 2016

I read “IT Showdown: Tech Giants Face Off against 18F.” What’s an 18F? If you do work for the US government, you associate 18 F with the address of the General Services Administration. The name now evokes some annoyance among established US government contractors. The term 18F refers to a group set up to reduce the time, cost, and hassle of getting IT “done”.

In the good old days, there were people in the US government who did things. Over the years, US government professionals rely on contractors to do certain types of work. In the information technology world, the things range from talking about how one might do something to actually setting up a system to deliver certain outputs.

Along the way, commercial enterprises provided hardware, software, and services. The hardware and software were, for many years, proprietary or custom crafted to meet the needs of a particular government entity. These statements of work made life difficult for a vendor who used what were often perceived as expensive solutions. License agreements made it tricky for a government entity to get another commercial outfit to modify or work around limitations of certain commercial systems.

According to the write up, some of the established vendors are grousing. I learned:

At a House subcommittee hearing on June 10, lobbyists from the IT Alliance for Public Sector (ITAPS) and the Software & Information Industry Association (SIIA) alleged that 18F is hindering profits by acting as both a procurement policymaker and as a tech competitor inside the General Services Administration (GSA). The two groups assert a conflict of interest, and in testimony, have submitted a list of grievances and recommendations intended to curtail 18F’s authority. The hearing was conducted jointly by the House Subcommittees of Government Operations and Information Technology to assess the effectiveness of 18F and the U.S. Digital Service (USDS) — a sister tech consultancy within the White House.

The industry group perceives the 18F outfit as a bit of a threat. Blanket purchase agreements, open source solutions, and giving certain contracts for small coding jobs to non traditional outfits are not what the established information technology vendors want to happen.

I find the dust up amusing. The revenues of established information technology vendors are not likely to suffer sharp declines overnight. The 18F initiative is an example of the US government trying to find a solution to escalating costs for information technology and the gap between the commercial solutions available and actual solutions deployed in a government entity.

Will 18F reduce the gap? One thing is certain. Some vendors associate the term “18F” with some different connotations. Imagine a government professional using a mobile phone app to perform a task for personal work and then using a mainframe act to perform a similar task in a government agency. Exciting.

Stephen E Arnold, July 5, 2016

Palantir Technologies: A Valuation Factoid

July 5, 2016

I read “Palantir Buyback Plan Shows Need for New Silicon Valley Pay System.” (You may have to view this write up. Don’t email me. I don’t think about “real” journalists.) Tucked into the somewhat humorous write up was a factoid. I want to capture it because “real” reporters and “real” information can be tough to track down using an online search system.

Here’s the factoid:

It [Palantir] is offering $7.40 a share to buy back up to 12.5 percent of an employee’s shares…Morgan Stanley recently marked down the value of Palantir’s shares to $5.92.

That $1.48 just hangs there. Too bad the write up did not answer this question:

What were the valuations Morgan Stanley assigned when Palantir Technologies had a valuation of $20 billion. I assume that rainbows, unicorns, and other “real” artifacts, one must assume that Palantir is zipping right along the information superhighway.

Stephen E Arnold, July 5, 2016

More Palantir Spotting

June 27, 2016

Trainspotting is a collection of short stories or a novel presented as a series of short stories by Irvine Welsh. The fun lovers in the fiction embrace avocations which seem to be addictive. The thrill is the thing. Now I think I have identified Palantir spotting.

Navigate to “Palantir Seeks to Muzzle Former Employees.” I am not too interested in the allegations in the write up. What is interesting is that the article is one of what appears to be of series of stories about Palantir Technologies enriched with non public documents.

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The Thingverse muzzle might be just the ticket for employees who want to chatter about proprietary information. I assume the muzzle is sanitary and durable, comes in various sizes, and adapts to the jaw movement of the lucky dog wearing the gizmo.

Why use the phrase “Palantir spotting.” It seems to me that making an outfit which provides services and software to government entities is an unusual hobby. I, for example, lecture about the Dark Web, how to recognize recycled analytics algorithms and their assorted “foibles,” and how to find information in the new, super helpful Google Web search system.

Poking the innards of an outfit with interesting software and some wizards who might be a bit testy is okay if done with some Onion type  or Colbert like humor. Doing what one of my old employers did in the 1970s to help ensure that company policies remain inside the company is old hat to me.

In the write up, I noted:

The Silicon Valley data-analysis company, which recently said it would buy up to $225 million of its own common stock from current and former staff, has attached some serious strings to the offer. It is requiring former employees who want to sell their shares to renew their non-disclosure agreements, agree not to poach Palantir employees for 12 months, and promise not to sue the company or its executives, a confidential contract reviewed by BuzzFeed News shows. The terms also dictate how former staff can talk to the press. If they get any inquiries about Palantir from reporters, the contract says, they must immediately notify Palantir and then email the company a copy of the inquiry within three business days. These provisions, which haven’t previously been reported, show one way Palantir stands to benefit from the stock purchase offer, known as a “liquidity event.”

Okay, manage information flow. In my experience, money often comes with some caveats. At one time I had lots and lots of @Home goodies which disappeared in a Sillycon Valley minute. The fine print for the deal covered the disappearance. Sigh. That’s life with techno-financial wizards. It seems life has not changed too much since the @Home affair decades ago.

I expect that there will be more Palantir centric stories. I will try to note these when they hit my steam powered radar detector in Harrod’s Creek. My thought is that like the protagonists in Trainspotting, Palantir spotting might have some after effects.

I keep asking myself this question:

How do company confidential documents escape the gravitational field of a comparatively secretive company?

The Palantir spotters are great data gatherers or those with access to the documents are making the material available. No answers yet. Just that question about “how”.

Stephen E Arnold, June 27, 2016

Peak Unicorn: Hooves of Doom

June 23, 2016

I loved the phrase “peak unicorn.” The co9mbination of mixed metaphors and a mythical horned equine is delicious. Navigate to “The Unicorn Godmother Dishes on Silicon Valley.” I find the addition of a “godmother” a bit like a 1958 Chevrolet Impala with additional chrome bolted on by an ambitious retro rod shop. Unicorns, peaks, and godmothers!

The main point of the write up in my opinion is not fruit salad metaphors. Here’s the passage I highlighted in passion fruit reddish purple:

I think we’re in a valuation-adjustment period where we’ve basically had very bullish markets both in the private and the public sectors for tech stocks over the past three to five years, and valuation multiples just got out of whack. There was too much money pouring into tech; and a perception developed that the only way to win was to offer a higher price. You know if there’s one house in a neighborhood that everybody wants, generally the way to get the house is to offer a higher price.

Yes, real estate. The “value” of a house in Holmby Hills compared to the value of a home in Pig, Kentucky.

The write up makes clear that some folks in Sillycon Valley may be getting nervous. Time to cash in and enjoy the good life. Unicorn farming in Pig, Kentucky? Search and content processing vendors are welcome too. A quick trip via flying car I hear.

Stephen E Arnold, June 23, 2016

Digital Currencies: More Excitement

June 21, 2016

An “attacker” explains the legal perception he has. You can read this argument at this link. I do not have a horse in this race. In my recent lecture at a security conference in Myrtle Beach, SC, I pointed out that digital currencies work reasonably well for what I call small scale transactions. Putting one’s life savings into a digital currency is a step some bad actors are reluctant to take. Traditional non digital money laundering and tax evasion methods will slowly yield to Fancy Dan types of “money.” But if you are adventurous, have a go.

Stephen E Arnold, June 21, 2106

The Job Duties of a Security Analyst

June 15, 2016

The Dark Web is a mysterious void that the average user will never venture into, much less understand than the nefarious reputation the media crafts for it.  For certain individuals, however, not only do they make a lively hood by surfing the Dark Web, but they also monitor potential threats to our personal safety.  The New York Times had the luck to interview one Dark Web security analyst and shared some insights into her job with the article, “Scouring The Dark Web To Keep Tabs On Terrorists.”

Flashpoint security analyst Alex Kassirer was interviewed and she described that she spent her days tracking jihadists, terrorist group propaganda, and specific individuals.  Kassirer said that terrorists are engaging more in cybercrimes and hacking in lieu/addition of their usual physical aggressions.  Her educational background is very impressive with a bachelor’s from George Washington University with a focus on conflict and security, a minor in religious studies, and she also learned some Arabic.  She earned her master’s in global affairs at New York University and interned at Interpol, the Afghan Embassy, and Flashpoint.

She handles a lot of information, but she provides:

“I supply information about threats as they develop, new tactics terrorists are planning and targets they’re discussing. We’ve also uncovered people’s personal information that terrorists may have stolen. If I believe that the information might mean that someone is in physical danger, we notify the client. If the information points to financial fraud, I work with the cybercrime unit here.”

While Kassirer does experience anxiety over the information she collects, she knows that she is equipped with the tools and works with a team of people who are capable of disrupting terroristic plots.

 

Whitney Grace, June 15, 2016
Sponsored by ArnoldIT.com, publisher of the CyberOSINT monograph

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