Market Power gives a firm the ability to employ anti-competitive tactics like predatory pricing without losing customers to competitors. During testimony on H.R. 2382, the Representative of The Merchants Payment Coalition stated that “there is no competitive market for interchange fees – just naked price fixing”. On the other side, the Representative from The Electronic Payments Coalition called interchange an “important element(s) of the successful, competitive banking experience” adding that “interchange reflects a merchant’s fair share of the costs” (sic.) of the system.

Last weeks GAO report found that Merchants’ are in fact paying more to accept credit cards, but also added that “network competition in the credit card market may be contributing to rising interchange rates”.

Two-sided markets exhibit “Network Effects” when two groups of users are attracted to each other, in this case retailers who accept payment and consumers who make payment.  “Cross- Side Network Effects” occur when enough users are attracted to one side that the other side will pay dearly to reach them.  In this case, retailers are the “money side” and they pay to accept cards as a form of payment, while consumers are the “subsidy side” who receive incentives to use the cards as a form of payment. Linking these two groups together is the primary value of the payment platform creating powerful Cross-Side Effects.

Retailers’ accept cards as payment because so many consumers use cards for payment. Competition between card issuing banks to capture consumers, and networks to capture banks is intense as evidenced by the multiple offers for high earning rewards credit and debit products and their users. Retailers ultimately see the cost of this competition reflected in rising interchange fees, particularly the higher rate fees for reward based programs. The question is; does this competition between networks and financial institutions for the consumers’ payment business justify the increasing rates paid by retailers to accept these forms of payment or does it constitute a monopolistic example of a market failure?

http://www.linkedin.com/in/peterguidi

Dragon slayer via Mugley

I

I’ve got issues with bureaucracies. In the past, a few years ago, it actually made me quite angry. I’m not like that anymore, but it just gets frustrating. Today, the plan was simple. Pick up my health check, get some documents from NTNU and go to the NIA office. This was what I was told to do. Unfortunately, things didn’t work out as planned.

When I arrived at the hospital, I was informed that I didn’t have the measles antigen, so I would need to be vaccinated. $20 and half an hour later, it was done. The woman from whom I had to pick up the health check realized that a part of my health check wasn’t done. She wanted me to come back next week. I saw no deal. I came to the hospital on the 17th to get it done. I was only here for a pick up. Now she wanted me to wait even longer?

I argued and made a big foreigner mess. I didn’t shout, but I made it clear that it was her fault (or the hospital’s) and that she needed to resolve this. 20 minutes later, some doctor performed a cursory exam of my skin for Hansen’s disease and I was done.

I went to NTNU and met Ying Ying. She was nice and helped me out with some docs. It took 15 minutes. I left for the NIA office. I arrived quickly enough, with about 1 hour to spare until closing, but I learned that it was here that I had to apply for an ARC, not get the resident visa. I had to go to BOCA¹ to get the resident visa. It was too late. They renewed my Visitor’s visa and took some of my paperwork, which means that I’ll have to get another printout from NTNU on Monday. Then off to BOCA and back to the NIA office. I was told that it might take a few days to get the resident visa, a week or two. I just want to be done with it.

II

I’ve been back in Taiwan for about 5 months and I only did one Visa run back in July because I arrived with a landing visa, not a visitor’s visa. Getting a visitor’s visa in Canada is quite expensive if you don’t have a car. I was living in Quebec. The TECO office is in Ottawa, 5 hours away.

The last time I did this, I spent over $400. This included travel and the visa itself. Back in May, I also spent a hellish night/day in Ottawa. This was because you need to arrive before 10AM at the TECO office in order to get your visa the same day. There are no overnight buses or really early morning buses from Quebec to Ottawa. The latest leaves at 8PM and arrives in Ottawa at around 1AM.

Siberian huspy pups, red/white color combo

III

I’ve been a bit sad about the Siberian husky that I found in the park yesterday. He would have been a great dog to have, but it would have been too much. I hope that he found his master. I’ll get a Taiwanese friend to ask Temple Man what happened with him. Siberian huskies are very beautiful. This one had are brownish/reddish white fur and they tend to have clear blue eyes. This one was docile and very friendly.

The bad thing about adopting an unfixed adult dog is that you didn’t raise him, nor did you train him. Admittedly, since he was pretty friendly, this wouldn’t have been hard, though I didn’t like how he kept marking everything. Even in our courtyard and my patio, he just kept at it. It was quite annoying.

A working dog like that needs hours of exercise every day. Spike is very laid back. In total, he does get somewhere between 1-2 hours a day outside. With a that husky, I would have to take him along while running or biking (daily) in order to work him out. Technically, that’s not a bad thing. I’d probably have taken him out while running, though he’d have to learn to run behind him. From what I’ve seen with Chad’s dog Ash, that isn’t easy since huskies like to run fast out front.

Once we get back to North America, I’ll get myself a medium-sized dog. It will either be a Siberian husky or a border collie. Naturally, we still plan on being French bulldog fanciers. Frenchies are great companion dogs.

IV

So I think that I’m nearing the end of Dragon Age, even though it says that I have only completed 25% of the game. I think I’ll try to complete the side quests before I complete the main quest. It sounds like once you start the Landsmeet portion of the game, it sets the wheels in motion for the final part of the game. I completed the DLCs The Stone Prisoner and Warden’s Keep. The first one adds Shale, a golem, to your companion roster. The second one gives you access to a castle as a base of operations. There is a chest there where you can store all of your gear, cheap merchants, and you gain two new abilities. The mage abilities are called Power of Blood and are very close to blood magic, but so effective. Dark Sustenance sacrifices health for mana and Blood Grasp sends some of the caster’s tainted blood onto targets. Works even better on darkspawns.

* * * * *

[¹]: Bureau of Consular Affairs of Taiwan

USA Today reports that many banks are bringing back the ol’ annual fee dinosaur in response to the Credit CARD Act.

If you don’t want an annual fee on your card, writes Sandra Block, go with the not-for-profit option:

If you don’t care about rewards and just want a credit card that doesn’t charge an annual fee, consider applying for a card through a credit union. Many credit union cards charge no annual fee and offer below-average interest rates.

Block has just one thing wrong: American 1 offers ScoreCard rewards, which can earn you travel and gift rewards.

Through the rest of the article, however, Block gives options if your big bank credit card starts charging an annual fee or reducing reward programs.

By Rob Packer

It’s been a tense week and a half while my Uzbek visa process has been going through. Uzbekistan is notorious amongst Central Asia veterans and novices as being the second-hardest of the ‘Stans to get into (number one is famously bizarre Turkmenistan). So I stayed sceptical of my chances when I arrived on a cold Tuesday morning last week at Bishkek’s Uzbek embassy as a citizen of a country, which does not have a fantastic relationship with Tashkent, with nothing but my passport, some photos and a visa form. For a select number of nationalities, these are supposed to be all you need, but for everyone else you’re supposed to be invited by a travel agency and arrive at the embassy brandishing a letter of invitation. None of these were required and as I sit here with an Uzbek visa in my passport, I’m left wondering whether Anglo-Uzbek relations have thawed, the fierce look I tried to give as I went in worked wonders, the woman took a liking to me, the rules really have changed, or I’ve just seen the consular equivalent of an astronomical conjunction.

My Uzbek visa. Worth the wait.

Although I didn’t have to come bearing paper, I did have to deal with the bureaucrat’s other weapons: multiple visits (three), a long wait (10 days processing) and slavishly following your request (I may have the world’s only 11 day visa). And then there was one last hurdle and CIS special: the soiled note. This is when you give someone a US bill and they decide it’s not worth the paper it’s printed on because it’s dirty, torn or has some other imperfection. My $100 bill’s crime? That note had a very small stamp mark, probably done by someone in a bank. This is a fight that can only be won with a new bill. So I jumped back into the car with the driver from work who took me to the nearest bank while I was sweating inside my coat. On the way back from the bank, where they seemed to be getting their dollars straight from the US Mint, Zakir was telling me about when he’d been at the Russian embassy in Tashkent and had been asked to explain why they was a pen mark on his bills and who’d put them there: I decided the best answer would be Barack Obama. At least when my unsoiled Franklin was changed hands, I got the crispest notes I’ve ever seen in return.

A soiled $100 note. See the small grey mark? Not counterfeit, but as good as.

Happy Thanksgiving, any of you USA people!

Which “Aem’meh” do you “tavas’sol” with?

Pyyh. Idag fick man hem ett ypperligt trevligt brev. Ett brev där det stod att jag skulle ringa min bank då de var tvungna att spärra mitt kort och även skicka mig ett nytt då det kan ha blivit kopierat av bedragare. Men woop? Varför motarbetar världen mig? Jag ringde iaf till banken och det var inga större svårigheter, nu hoppas jag bara att hon håller sitt löfte om att mitt nya kort kommer i nästa vecka. Jag måste ju ha det innan vi åker iväg iaf. Tills dess är det nästan lika bra att inte ha ett kort, då kan jag ju inte göra av med några pengar, PRIMA!

I övrigt är jag galet trött. Sov för få timmar inatt, ätit på tok för dåligt och sen tränat i en timme med Josefine. Nu är jag helt utmattad och vill verkligen unna mig lite frosseri idag. Mmmums! Vad jag ska frossa i vet jag icket. Men jag är en saltgalning. Så gärna popcorn eller chips. Och en kall cola. Ja. Det förtjänar jag!!!

1. Do your research.
The first few weeks of your trip are going to be the hardest. You’re going to experience culture shock. You’re going to feel lost. You’re going to feel alone and vulnerable. Everything is going to be unknown to you, and it’s going to be scary. This is inevitable, but it can be minimized by doing your research before your home country. What should you research? Everything. Read every single book you can find about the place you’re going. Read travel sites, expat sites, newspapers from the place you’re going to. Anything you can learn to familiarize yourself with the place you’re going to will help make it easier to transition into. Ideally you should visit the place you’re going. It’s not necessary, but it will definitely help.

2. Get a working Visa.
Don’t move to a new country on a holiday Visa and expect to be able to find work. Even if you’ve applied for a residence Visa that you need sponsorship to complete, you’re going to be far less likely to get that sponsorship if your employer has to wait two months before you can start work. The exception to this is if you’ve already been offered sponsorship before leaving, but if that’s the case you probably have a high level degree from a university and make a ton of money. In that case the road before you will be paved pretty smoothly anyway. If you’re like most people though, don’t move to a foreign country on a holiday Visa if you can just as easily apply for a working Visa. It just opens more options.

3. Get everything squared away at home before leaving.
Any unfinished business at home (especially involving bills) will be ten times harder to deal with from a foreign country, and with all the stress and the unknowns you’re going to be dealing with already, you don’t need that extra monumental headache in your life. Don’t rush off to your grand adventure. Take the extra time to square away any paperwork, bills, contracts or other obligations you may have at home before leaving.

4. Lower your expectations.
Have you ever been to see a movie that you thought was sure to be awesome only to find out it was mediocre and you hated it? Have you ever been to a movie you were sure was going to suck only to find out it really wasn’t that bad and you left feeling fairly impressed even though the movie wasn’t really that great? Moving to another country is the same way. If you’re moving to another country you obviously believe it’s a place worth moving to and is for some reason preferable to the place you’re at. However, I guarantee it’s not going to be perfect. There are going to be downsides to it. If you go into your journey expecting to find the land of milk and honey you’re going to be sorely disappointed. If you go into it fully prepared to experience disappointment you’re going to be far less disappointed, and in the end you’re going to have a more positive experience.

5. Bring at least $20,000. (This figure is in US dollars. Convert accordingly.)
The number one cause of stress and ultimately failure when moving to a foreign country is money problems. The less money you bring the harder your life is going to be, the less secure you’re going to feel, the less leisure options you’ll have and the less time you’ll have to find a job. Between exchange rate fees, government fees, rental deposits, utility bills, food, transportation, leisure activities and buying toiletries, basic necessities you couldn’t fit in your suitcase and especially unforeseen expenses, you should really bring at least $20,000 with you or else you’re going to be extremely stressed during what will probably already be the most stressful experience you’ve ever had. You might still make it, but the more money you bring the better off you’ll be in every way.

6. Find temporary lodging at your new location and be prepared to change them.
Set this up before you leave so you’ll have a place to check into when you get there. However, don’t book it for more than a month. It might turn out to be a horrible environment. It might also turn out to be far away from where you want/need to be. So give yourself some leeway to move around a bit as you get your bearings. Also, don’t stop moving around until you’ve found someplace comfortable. I hate to keep harping on how stressful moving to another country is, but stress is inevitable. The only question is how stressful you’re going to make your life. Living in a place far away from where you want/need to be, living with roommates you don’t like in a cramped apartment that irritates your allergies where you have no furniture is going to seriously hurt your chances of happiness and ultimately success. If the first place you unpack your bags at isn’t working for you, get out of there and find a place that does work for you.

7. Get the Internet.
Bring a laptop with you. Other than your passport, nothing else is more important than that, and anything else you had to leave out of your luggage can be bought cheaply on the local market. If you can, try to stay at some place that provides Internet connection. If the place you’re at doesn’t have the Internet, get it. You’re going to need the Internet to stay in contact with your family and friends, look up bus schedules, buy a car, find a job, meet people, learn about the local area and a hundred other vital things you wouldn’t predict. You’re going to be lost without the Internet. So just go ahead and put that at the top of your list of things to do when you arrive in country. Granted, you can still use Internet cafes, but those are a pain in the ass. Avoiding Internet cafes will lower your stress level.

8. Network.
Once you get on the Internet, find some meet-up groups in your local area. The best case scenario is to meet other expats. Nobody is going to be more helpful than other people who have already walked in your shoes or are walking in them right now. I know you probably can’t wait to meet the locals, but your fellow countrymen are going to be more eager to help, and they’ll lessen the culture shock. Having said that, you should definitely also join meet-up groups with the locals. It’ll be fun. It’ll help you transition into the new culture and you’ll meet people who can offer you inside information.

9. Similar to #8, ask the locals.
Inevitably you’re going to have a lot of questions that need answers when you get to your new country. How do I find a job? How do I use the bus? How do I buy a car? How do I apply for any of the dozens of forms and applications I need to apply for? You can find all these answers after hours of research on the Internet or you can walk down to the gas station and ask a local. Typically they’ll be more than happy to point you in the right direction. If you have a question, save yourself some time and just ask a local.

10. Get out of the house.
No matter how prepared you are to move to a new country there will always be unknowns. The unknown will be the scariest part about moving. The only way you’re going to turn the frightening unknown into the comfortable familiar is by getting out of your house and seeing what’s out there. Walk the streets. See the sights. Meet people. Sitting in your house is just going to prolong your discomfort, give you time to brood and make you bored.

11. Get away from your spouse.
Your husband/wife or boyfriend/girlfriend (if you bring one) is going to be your greatest source of support as well as misery. I heard somewhere that 50% of marriages end when moving to a new country. I don’t know if that’s true, but I can guarantee you that moving to a new country is one of the greatest challenges your relationship will ever face. In order for your relationship as well as the trip itself to work you’re going to need to have patience with one another, communicate with one another, compromise with one another and spend some time away from one another. Even if it’s just a walk in the park, you’re going to need to get away from your significant other on a regular basis to clear the air and not get on each others’ nerves.

12. Start a blog.
This isn’t absolutely necessary, but it’s a great idea. Just, make sure to set it up before you leave home so you don’t have to stress about setting it up when you’re in country dealing with a thousand other things. Writing a blog is a great way to stay in touch with family and friends, express your thoughts and offer advice you wish you would have been given about things you had to learn the hard way. In addition to that, it’s a rewarding experience. It adds another level to your adventure and provides you with a digital scrap book to look back on.

Word on the street is that Visa is set for a major mobile payments announcement in next 6-8 weeks. Separately, US MNOs are also rumored to be collaborating on Near Field Communications (NFC) payments with acquirers. Could it be that the log jam on NFC is about to be broken? Is Visa developing new rails to support mobile payments? Let me say up front that this blog represents “connecting the dots” more than a definitive market projection.

The US market is ripe for a break from the 6 party political “fur ball” that is hampering delivery of mobile payment (Card Issuers, Acquirers, Network, Merchant, MNOs, Handset Mfg). For those outside the US, MNOs have substantial control over handset features and applications, and have been leveraging this “node control” to “influence” direction of payments. The central US MNO argument being: “it is our customer, our handset, our network we should get a cut of the transaction rev”. Unfortunately existing inter-bank mobile transfers/ payments are settled through existing payment networks that provide limited flexibility in accommodating a “new” MNO role and the network rules leave much room for improvment in: authorization, authentication and consumer “control”. 

Outside the US, the situation is much different, as consumers have great flexibility in switching MNOs, have ownership of their handsets, and are largely on pre-paid plans. The MNO challenge for payments in this environment is largely regulatory. Many countries (EU, HK, Korea, Japan, SG) have open well defined rules for MNOs role in payments (example: ECB ELMI framework within the EU), while other countries are highly restrictive and are in the midst of developing their legal and regulatory framework. Even in the countries where MNOs participation is defined, they have largely benefited from the complimentary role that the service plays with pre-paid plans (not in interchange at POS).

Globally, MNOs are looking for a payment platform where they can benefit from interaction between consumer and merchant, with flexibility to deal with a heterogeneous regulatory environment. The competitive pressures on Visa/MC are much different then they were 5 years ago (when both were bank owned). The network fee structures and rules were written with banks and mature markets in mind. Emerging markets present a much different set of opportunities, as MNOs lead banks in brand and consumer penetration within every geography.

All of this leads to the case for a new “Mobile Payments Settlement” network, a network which will alienate many banks. I expect to see Visa roll out the initial stages of this network in the next 2 months with an emphasis on NFC. Quite possibly the best kept secret I have ever seen from a public company. I’m sure many Silicon Valley CEOs are crossing their fingers (with me) on this, as a “new wave” of innovation is certainly close at hand that will drive growth (and valuations).

For those not keeping up with the 50 or so product announcements a day on NFC, handset manufacturers committed to have NFC enabled phones to consumers in mid 2009 in the GSMA 2008 congress. NFC capabilities are numerous (Vodafone YouTube Overview), and may represent a true disruptive innovation surrounding payments. There have been many very recent product announcements that will enable existing phones to use NFC, and P2P Capability. All of which will blossom in a more “fertile” mobile settlement environment. See one example “future” Visa mobile service here: http://tomnoyes.wordpress.com/2009/09/24/googleoff/

Side note: This is not all bad news for Banks, as the structure will certainly provide for existing cards (debit/credit) and may deliver substantial revenue through cash replacement (small < $50) transactions. More details on structure of MNO in settlement 2 weeks….

Select Product/Alliances Below:

• http://www.corporate.visa.com/media-center/press-releases/press921.jsp
• http://www.neustar.biz/pressroom/files/announcements/VISAFINAL.pdf
• Neustar http://www.americanbanker.com/issues/174_125/-383355-1.html
• http://www.nearfieldcommunicationsworld.com/2009/11/04/32152/zenius-adds nfc-to-standard-mobile-phones-with-bladox-waver/
• http://www.paymentssource.com/asset/article/2703061/att-certifies-charge-anywhere-mobile-payment.html?pg=
• http://www.morerfid.com/details.php?subdetail=Report&action=details&report_id=6376&display=RFID
• http://www.nfcnews.com/2009/11/18/attachment-turns-iphone-into-rfid-nfc-reader
• http://www.bladox.com/
• http://www.celent.com/124_1187.htm

Complete info on the PBS Frontline segment called: The Card Game”

Click here to watch

“As credit card companies face rising public anger, new regulation from Washington and staggering new rates of default and bankruptcy, FRONTLINE correspondent Lowell Bergman investigates the future of the massive consumer loan industry and its impact on a fragile national economy.”

THE FIGHT OVER INTERCHANGE FEES: “Interchange fees are now the central issue in what is being called the largest private antitrust litigation in U.S. history.  Five years ago, Mitch Goldstone, an independent owner of scanmyphotos.com, an online photo service company, was struggling to keep his Southern California shop afloat. He began scrutinizing every expense and revenue stream of his small business. When he realized that an already costly expense — interchange fees – was increasing, he was livid.  “It got to the point where I had just a few employees and things were looking really bleak,” said Goldstone. “Interchange fees were the one expense that was going up, no matter what I did.”  In 2005, Goldstone (PDF) and more than 30 other merchants filed antitrust lawsuits in U.S District Court against Visa, MasterCard and several of their member banks, accusing them of breaching federal antitrust law by fixing the prices on interchange fees.”

[/source]

Days after ICE announced their plan to issue 1,000 Notices of Inspection to employers whose businesses relate to the critical infrastructure of the nation, a redacted copy of a subpoena has been provided. The subpoena indicates that ICE will review:

• Original I-9’s
• Payroll records
• Tax records
• Employee rosters containing employees name, date of birth, SSN, date of hire and termination
• Payroll reports with wage detail
• Quarterly tax reports
• Lists of any independent contractors used by the company and copies of their 1099s
• All SSA employer correction requests
• Copies of any USCIS forms I-129, I-140 and ETA-750/9089

ICE will also review the company’s articles of incorporation, business licenses and annual reports, company policies regarding completion of I-9’s, E-Verify participation, previous I-9 inspections, and the companies use of temporary staffing agencies.

On November 24, 2009, USCIS announced that as of November 20, 2009, approximately 56,900 H-1B cap-subject petitions had been filed. USCIS has approved sufficient H-1B petitions for aliens with advanced degrees to meet the exemption of 20,000 from the fiscal year 2010 cap. Any H-1B petitions filed on behalf of an alien with an advanced degree will now count toward the general H-1B cap of 65,000. USCIS will continue to accept both cap-subject petitions and advanced degree petitions until a sufficient number of H-1B petitions have been received to reach the statutory limits, taking into account the fact that some of these petitions may be denied, revoked, or withdrawn.

Developed to support ATL campaign

Making off Visa Domodedovo

As of November 20, 2009, approximately 56,900 H-1B cap-subject petitions had been filed. USCIS has approved sufficient H-1B petitions for aliens with advanced degrees to meet the exemption of 20,000 from the fiscal year 2010 cap. Any H-1B petitions filed on behalf of an alien with an advanced degree will now count toward the general H-1B cap of 65,000. USCIS will continue to accept both cap-subject petitions and advanced degree petitions until a sufficient number of H-1B petitions have been received to reach the statutory limits, taking into account the fact that some of these petitions may be denied, revoked, or withdrawn.