Friday, December 31, 2010

Happy New Years!

Happy New Years, folks! 
Thank you all for stopping by, I wish you all the very best in 2011!
- CP

"Our Choice..."

"Human history can be viewed as a slowly dawning awareness that we are members of a larger group. Initially our loyalties were to ourselves and our immediate family, next, to bands of wandering hunter-gatherers, then to tribes, small settlements, city-states, nations. We have broadened the circle of those we love. We have now organized what are modestly described as super-powers, which include groups of people from divergent ethnic and cultural backgrounds working in some sense together — surely a humanizing and character building experience. If we are to survive, our loyalties must be broadened further, to include the whole human community, the entire planet Earth. Many of those who run the nations will find this idea unpleasant. They will fear the loss of power. We will hear much about treason and disloyalty. Rich nation-states will have to share their wealth with poor ones. But the choice, as H. G. Wells once said in a different context, is clearly the universe or nothing."
- Carl Sagan

"A Buddhist Prayer of Forgiveness"

 "If I have harmed anyone in any way, either knowingly or unknowingly
through my own confusions, I ask their forgiveness.

If anyone has harmed me in any way, either knowingly or unknowingly
through their own confusions, I forgive them.

And if there is a situation I am not yet ready to forgive
I forgive myself for that.

For all the ways that I harm myself, negate, doubt, belittle myself,
judge or be unkind to myself through my own confusions,
I forgive myself."

"A Buddhist Prayer of Forgiveness"

Gregory David Roberts, "Shantaram"

"It’s forgiveness that makes us what we are. Without forgiveness, our species would’ve annihilated itself in endless retributions. Without forgiveness, there would be no history. Without that hope, there would be no art, for every work of art is in some way an act of forgiveness. Without that dream, there would be no love, for every act of love is in some way a promise to forgive. We live on because we can love, and we love because we can forgive."
- Gregory David Roberts, "Shantaram"

"How To Cure A Hangover, Or Not"

 "How To Cure A Hangover, Or Not"
By Colleen Graham

"Now you've done it and it's official, you have a hangover. Now what? No matter what you do sleep and water or juice should be included. There are many folk cures that are supposed to help cure a hangover. Many of them will help you cope by replenishing the vitamins and liquid you lost over night, while some like avoiding caffeine are very important to a quicker recovery. There is no one size fits all cure, find what works for you but the list below is a good place to start. There are also a few suggestions from readers who found their own way to cope.
Difficulty: Hard
Time Required: As long as it takes to feel better. 
Here's How:

• Sleep. Rest is your best friend at this point to give your body a recover. It is best to stay in bed so call in to work if you have to, tell them you have the stomach flu. You will sound so horrible on the phone they may believe you (unless they saw you at the bar, not a good idea then).
• Replenish your body with fruit juice and water.
• Avoid caffeine. A weak cup of coffee may be okay but a lot of caffeine will continue to dehydrate you, the opposite of what you want right now.
• Drink orange juice for Vitamin C.
• Drink a sports drink like Gatorade or Powerade.
• Eat mineral rich food like pickles or canned fish.
• In Poland, drinking pickle juice is a common remedy.
• Drink a Bloody Mary. While the popular phrase “hair of the dog that bit you” may sound logical with a shot of whiskey left in the bottle next to your bed, it’s only temporary. Try a Bloody Mary instead, while your blood is dealing with the new alcohol it is ignoring the old and in the mean time tomato juice and celery are full of vitamins. If you drank the last of the vodka make a Virgin Mary. Another spicy morning after drink option is Hair of the Dog, in which gin and hot sauce are sure to bite your hangover back.
• Take a shower, switching between cold and hot water.
• In Ireland it was said that the cure for a hangover is to bury the ailing person up to the neck in moist river sand.
• Try Alka Seltzer Morning Relief. One reader says that it's all that he and his wife have found that really works for them. He stumbled across this "cure" while his wife was still suffering after two days, within 15 minutes after taking the Alka Seltzer she was fine.
• Get some exercise. Another reader suggests doing some sort of physical activity. He writes, "In the rare case of having hangover I usually drink about 1-2 liters of water and go outside to do some exercise like mountain climbing, swimming, cycling or just about anything that keeps me sweating." It takes willpower to move like that when standing seems like a challenge, but it is a good theory. 
• The side effects of aspirin, Tylenol and ibuprofen can be magnified when alcohol is in your system, so it is best (even though it may be the first thing you reach for) to avoid them to kill the hangover pain. Aspirin is a blood thinner, just like alcohol, and can intensify its effects and Tylenol (or acetaminophen) can cause more damage to your liver. Ibuprofen can also cause stomach bleeding. So be cautious when going for the quick relief.
• Watch the video: "Hangover Remedies." Jonathan Stewart demonstrates how to make a blended hangover remedy. There are a more than a few ingredients so you may want to have everything organized prior to overindulging.
• As an antidote, one reader takes a little extra multi B vitamin and drinks a lot of water before going to sleep."

Alex Noble, "A New Years Message"

 "And A Very Happy New Year To You And Yours!"
 by Alex Noble

"In the midst of the the noise and the parties and the traffic and the compelling distractions, in the middle of all that, consider taking a few minutes to think about what happiness means to you and how you want it to manifest in your life.
Ask: Are there any draining and burdensome relationships in my life which are preventing me from experiencing the full spectrum of my God given Divine Happiness?

Ask: Have I accepted someone else's problems as my own to a point where I am drowning in false responsibility, ongoing fatigue, and endless financial loss?

Ask: Is there anyone in my life I need to set free as a blessing to them as well as to myself?

Ask: What can I do right now, today, to experience more happiness? Make lists. Commit. Do it.

Ask: What does real happiness feel like? Do I know or have I forgotten? Am I the person in that old Blues song "Been down so long gettin'up never crossed my mind"?  Are there any places in my life where I am accepting limitations, constraints, crushing impositions that may well be killing me or at least killing my innate sense of happiness? Have I bought into others' sad stories to a point where I have taken their problems as my own?  WHY?

Ask: What one action can I commit to today to bring 10X more happiness into my life? And into the lives of those I meet on the Path? That's right: TEN TIMES MORE HAPPINESS!
Now, go do those things you can do! As the great English statesman once said: 
"Never explain, never apologize, have it done and let them howl!"

Happy New Year!

"How It Probably Will Need To Be"

Thomas E. Dewey

"We need not be afraid of the future, 
for the future will be in our own hands."
- Thomas E. Dewey

“America’s Mood Entering 2011”

 “America’s Mood Entering 2011”
By The Economic Collapse Blog

“Around the end of the year a ton of polls and surveys get taken.  Media organizations love to get a "snapshot" of how the American people are feeling as the new year begins.  So what kind of mood are the American people in as we enter 2011?  Well, if the polls are to be believed, they are less optimistic, they are a bit scared, they are very frustrated and they are becoming increasingly angry.  A solid majority of Americans believe that the country is moving in the wrong direction and they desperately want someone to fix the economy.  What Americans seem to want most of all are good jobs.  At the end of the day, Americans want to be able to pay the mortgage and put food on the table.  If they can't do that, then what is going on with other "important issues" really isn't going to seem very important to most of them.

So is it a good sign that for the week ending December 25th that claims for unemployment benefits fell below 400,000 for the first time in a very, very long time? Well, it turns out that claims for unemployment benefits decline every year right around the holidays and they decline every time a major winter storm hits much of the country.  Considering the fact that both of those things have happened recently means that we shouldn't be celebrating too much yet.  Let's see what happens after the holidays and when the weather gets a bit better. The truth is that the official unemployment rate has been hovering just under 10 percent for the entire year and people are getting really tired of searching day after day for good jobs that don't seem to exist.

The following is a compilation of recent poll results that show just how frustrated and angry the American people are becoming as we enter 2011...

The American People Are Dissatisfied With The Economy: A recent Bloomberg National Poll found that two-thirds of Americans believe that the country is headed in the wrong direction.  But most Americans felt we were going in the wrong direction under George W. Bush as well.  The truth is that the American people are going to continue to be frustrated with the "direction of the country" until the economy starts to show some sustained improvement. So are things going to get better soon?

Well, one thing is for certain.  Americans are becoming less optimistic. In a recent Pew Research survey only 55 percent of Americans said that the year ahead would be "better". That was significantly down from 67 percent who believed that the year ahead would be "better" back last January. According to that same Pew Research survey, a whopping 89% of Americans rate national economic conditions as "fair" or "poor", and 79% say that jobs are difficult to get in their local communities. As noted earlier, that is the main thing that most Americans want.  Most Americans want to be able to work hard and provide for their families.  But for millions of Americans today that has not been a reality for a very long time.

So will more good jobs be created soon? Well, a majority of new jobs in the United States are created by small businesses, and right now small business owners do not have a very positive view of the coming year at all. A recent survey of small business owners found that 25 percent believe that the U.S. economy is getting better but 51 percent believe that it is getting worse. Hopefully the economy will at least stabilize a bit in 2011, because if it doesn't, the poll numbers are going to look really ugly next year at this time.

The American People Have Very Mixed Feelings About Barack Obama: In case you haven't noticed, we live in a country that is very polarized politically. Those on Barack Obama's "team" love him, while those on "the other team" absolutely hate him. However, there are signs that even many of those that have been highly supportive of Obama for a long time are starting to have their doubts. According to the latest Gallup poll, Barack Obama's approval rating is at 47 percent.  This is way, way down from when he first took office. In addition, Gallup recently reported that Barack Obama's approval rating among liberal Democrats had fallen below 80 percent for the first time since he took office. When Obama was first elected, even most of those who voted against him wanted his presidency to be a success. But that has been changing. A CNN/Opinion Research Corp. poll released this past week found that 61 percent of Americans hope that Barack Obama's policies succeed. This was down substantially from 71 percent just one year earlier.

In particular, health care has been an issue that has caused dissatisfaction with Obama among the voters. One new poll has discovered that a whopping 61 percent of U.S. voters believe that the new health care law will cause health care costs to increase. But the truth is that Obama still has a huge base of supporters that love him and will support him no matter what. Why? Because voting for "the other guys" is unthinkable for millions upon millions of liberal Americans.

Many Americans Will Worship Their Politicians No Matter How Incompetent They Are: The vast majority of Americans are trapped inside the left/right paradigm. The mainstream media tells them that they have to pick one of two "teams" - either the Republicans or the Democrats. If you are a Democrat, then the Republicans are the bad guys and you have to hate them no matter what. If you are a Republican, then the Democrats are the bad guys and you have to hate them no matter what. But the American people are taught that the leaders of their own "teams" should be treated like rock stars and celebrities. So millions upon millions of Americans love and worship Obama just like millions upon millions of Americans loved and worshipped Bush.

It doesn't matter to most Americans that the same very powerful interests control both the Republican and the Democratic establishments. They are going to cheer for their "team" no matter how incompetent the leaders turn out to be.

Today, top politicians are the most admired people in America. In a recent USA TODAY/Gallup Poll, Barack Obama was the most admired man in America. George W. Bush was the second most admired man in America. It doesn't matter that both of them are incompetent or that both of them are pursuing very, very similar agendas. The Democrats love Obama because he is the leader of their "team" and the Republicans love Bush because he was the leader of their "team". The same poll found that Hillary Clinton is the most admired woman in America and that Sarah Palin is the second most admired woman in America. Are Americans really that brain dead?

More Americans Than Ever Have A Negative View Of The Federal Reserve: Perhaps there is some hope for the American people.  More of them than ever before view the Federal Reserve negatively. A recent Bloomberg National Poll found that a majority of Americans now want the Federal Reserve to either be held more accountable or to be abolished completely. The following is how Bloomberg described the stunning results of this survey... “Asked if the central bank should be more accountable to Congress, left independent or abolished entirely, 39 percent said it should be held more accountable and 16 percent that it should be abolished. Only 37 percent favor the status quo.”

So what is so wrong with the Federal Reserve?  Well, for an in depth look at what is wrong with the Fed, check out the following articles...
* "11 Reasons Why The Federal Reserve Is Bad"
* "Debt = Money, Money = Debt"

The American People Are Overwhelmingly Against The War In Afghanistan: The American people don't understand why it has taken us longer to defeat a bunch of goat herders running around the hills of Afghanistan than it did to fight all of World War II. We have been over there for nearly a decade now and the American people are getting sick of it.  A recent CNN/Opinion Research Corporation survey discovered that 63 percent of Americans are against the war in Afghanistan.This is not a liberal/conservative thing. The truth is that each year the "war in Afghanistan" is getting even bloodier and we don't seem to be accomplishing anything. We can't be the police of the world and the American people are tired of sacrificing so much for so little in return.

The American People Are Turning Away From Religion: With each passing year, it seems as though God becomes even less important to the American people. According to a new Gallup poll, approximately seven out of every 10 Americans think that religion as a whole is losing its influence on American life.  Gallup has been asking that question for over five decades and the percentage of Americans that believe that religion is losing influence in society has rarely ever been higher. Another new Gallup poll has found that only 40 percent of Americans believe in creationism. That is the lowest percentage of Americans that have indicated that they are creationists since Gallup began asking that question back in 1982. Perhaps we should remember why we were once the greatest and most prosperous nation on the earth.”

The Economy: Karl Denninger, "The 2011 Predictions"

 "The 2011 Predictions"
by Karl Denninger

"We're not going to get away with spending another $450 billion in deficits on top of the $1.6 trillion we blew last year. $2 trillion in deficits? Not a prayer. Coburn (who voted for TARP, incidentally) said we had "four or five years" to get this under control. Nope. The time is now and this will be the year where the strain shows up in very uncomfortable ways. Since we put in place hundreds of billions in tax incentives and changes for the next two years, and The Republicans won't back off on that, we're going to see some sort of spending issue. This should get interesting given the Senate and Obama in the White House. What The Democrats seem to forget is that not spending is in fact something The Republicans can do whether the Democrats like it or not as they can refuse to pass and send up appropriations bills or continuing resolutions! The only question remaining on the table is whether The Republicans will come to town and do this or whether the market will force them to do it. Pick one, either way "entitlement nation" is about to get a surprise. Incidentally, I see this as emergent in 2011 but really getting ugly into the elections in 2012 - which sets up a number of interesting scenarios for that year.

Europe will not get their debt situation under control. I give us a 50/50 chance that Ireland repudiates it's "deal" immediately following their elections, and the cancer there will spread. I won't call a breakup of the Euro - yet - but the possibility exists that one or more nations will leave the common currency next year. I only see the odds as something around 50% though, so it doesn't go on the "prediction" board for this year.

The Dollar remains the hooker with crabs while many other currencies have AIDS. The wildcard is the Pound. Britain may actually have their act under reasonable control. We'll see. For the Euro, no such luck. I expect a wide trading range with lots of both euphoria and tears, perhaps as much as 40% or more. That means we'll get plenty of whipsaws in the /DX as well. Nonetheless, the doomers call of a dollar collapse and gold at $3,000+/oz will be wrong.

Oil is going to $100, and maybe considerably higher - but not on demand, rather on a "safe haven" and speculative play. Go look at 07/08 for how this plays out. And get ready for the bad effect on your wallet from higher gas prices. I expect the $4 line to be breached in high-cost areas by the summer, and we may see $5 gas this year. But - by the end of the year oil will be on the decline. Again. And again, it will be because the economy is in fact going down the crapper.

Commodities will continue to ramp right up until oil tops as the economic reality that "charge it" can't fix what's broken sinks in. Recognition will come hard and fast, and metals will not be exempt.  When oil starts to roll over beware. Everyone loves commodities. When everyone's on the same side of the boat it usually tips over and there are sharks in the water below.

Fannie and Freddie will get some sort of "resolution" path - and it won't be positive for them.  There's wide agreement that they were part of the problem. The republicans will blame the CRA as has been their refrain for years, but in the end it won't really matter. Expect an intermediate-term solution that prices Fannie and Freddie out of the mortgage market over the next 5-10 years but my best guess is that the government doesn't have the stones to force the bad paper back where it belongs - not entirely anyway. The government will also not be willing (or able) to keep its paws off the market, and this may well lead to a new crisis - in another 5 years or so. In other words they'll "fix" it by breaking it worse. Best bet is that we have Fannie and Freddie get "merged" and they'll try to hide the bad paper.  That may work for the Fannie and Freddie MBS, but.....

"Someone" will pry open the REMICs in MBS-land for at least private-label deals and fun will ensue. Don't be long big banks when it happens. The wheels of justice turn slowly, but they do turn and I believe 2011 will be the year when the logjam breaks. This, incidentally, is the one prediction that in my opinion is the highest-risk - the banks know this bomb is ticking and will try to defuse it through some sort of backdoor deal. I don't think they'll get it done - the lawyers smell blood and there's too much money to be made taking bites out of some very fat cats. If I'm right there will be at least one burnt offering made - probably BAC - and, if it comes at the wrong time, it won't stop there. If this gets going in the middle of a broad market sell-off Lehman will look like a cake walk.

China will roll over as their attempts to tighten policy have come too small and too late. They too have too many plates in the air.  Anyone who thinks that you can build cities full of apartments with nobody living in them and not have it blow up in your face is ridiculously naive.  Is China a good bet down the road?  Sure, once that speculation comes out and the pricing adjusts.  But this isn't in the here and now.

Housing is and will "double-dip."  There's no bottom. Those who bought the gamed reflex bounce on the tax credits and faux "stabilization" are in big trouble. My projection is for a mid-single-digit to 1x% decline in prices nationally in 2011, and even then it won't be over.

States will try to tax their way out of pension trouble, and fail. The Whitney call will be wrong but only because of how she phrased it.  States and municipal governments will be increasingly recognized as insolvent but they will continue to play games to try to stretch cash flow rather than defaulting outright. The States will not get bailed out (again) by The Feds - the money isn't there.  Beware the municipal bond market - IQI, for example, looks damn enticing right now in the $11s, down from $14 and yielding 7.3% tax free. That sort of spread over Treasuries is beyond insane, especially with the tax preference, and is pricing municipal debt as trash. If you like gambling and want to bet that The States will pull it off it's damn hard to beat a current 7+% tax free coupon and a potential 20% or more price appreciation potential on top of it. The problem with such appearances of a free lunch is that the sandwich offered to you is almost always laced with arsenic.

Between forced State austerity and semi-forced Federal austerity the rug will get pulled of the master "credit card spending" support. The disruption that will become evident, especially in the back half of the year, will be material. But the worst of it won't be in 2011 - it will be in 2012 and beyond.

Fed Index price paid/received divergences along with inventory build say we're going to double-dip in the general economy. I believe it. The Fed has of course tried to stop this with their QE games but they're not getting the effect they claimed they were after. The Hopium runs out in 2011 and the addict will go through withdrawal.

Margin compression will become realized. I'm just about the only one who's been talking about it in the back half of 2010 based on the PPI/CPI reports and regional Fed indices, but that won't last. We'll start to see it in the Q4 earnings and by Q1 people will be talking about it. This will put a cork into the "multiple expansion" crap that a whole lot of "pundits" have been running over the last year.

The inventory build we've experienced will prove to have been unwise. Expect a cycle of write-downs which will further damage earnings. Unsold inventory is a millstone around your neck. I've been talking about the warnings evident in the data on this for six months or so - the bet the market has made is that this will be sold through. Nope.

The Fed will get neutered, but it won't be due to Ron Paul.  He'll huff and he'll puff but won't blow down their house. It won't matter. Bernanke's credibility will be severely trashed by the end of the second quarter as his monetization will be increasingly seen by The Republicans as nothing more than a way to pander to the profligacy of Congress (which they'll try to pin in the Democrats, despite their fully-complicit role in it.) The end result (albeit through the typical partisan BS) will be that QE2 is the last time that happens, period. I expect an all-on attempt to change The Fed mandate to remove "employment" and possibly define "stable prices." These two things, incidentally, would be tremendously positive, and the first might actually succeed. The second?  Don't hold your breath.  Dennis Kucinich's bill would be even better, and it will be reintroduced - and fail to gain any material sponsorship including from the Pauls. Somewhere around the middle of the year this entire dynamic starts to become interesting in the 2012 Presidential sense.

The TNX will hit 4%, likely in the first quarter. The bad news is that spreads are likely to widen against everything else. Paradoxically, if we do get forced austerity - even a hint of it - on the federal spending side (and I believe we will) we'll see rates on the long end remain in control post-QE2 - they won't collapse as they did post QE1 but they also won't go bananas on the upside.  Scratch that latter half prediction if the 'Pubs roll over on spending or worse, try to ram through more tax cuts (and they might) - if so you better buckle up and the trade of the year will be to short the long end of the curve.

We won't get bond auction "fails" per-se (that's impossible given the Primary Dealer setup) but there will be plenty of "D"s and "F"s in terms of grades, with lots of tail showing.  Again, I expect this mostly in the first half of the year - unless the Republicans do something stupid (see the above item.)  This of course won't do good things for mortgage rates and stability in the mortgage market (which feeds into the housing projection above.)

The market will roll over this year.  And not in a small way either.  We may finish the year over 1,000 on the SPX, but we're going Helium-style diving at some point first.  Since timing is everything in this game I'll stick my neck out - there will be a sucker sell-down early this year, the market will bounce, and then Hell will rain on earth later in the year and into 2012.  If you want an analogue for it look at 2000 and before you buy into the end of the year note that buying the 2000 Christmas rally into January 2001 was one of the worst mistakes you could have ever made.  Momos will crack first - this has probably already started.  When you look at the above if even half of the above predictions play out the odds of an outright crash are quite high as the market has priced in an actual recovery.  I don't see it - what I see is unemployment remaining high and we're trying to hide it with the government credit card.  There are too many plates in the air on too many sticks and someone's gonna drop one.

Expect extreme volatility.  Anyone thinking the VIX in the teens makes sense is going to be proved nuts. There will be insane money-making opportunities for short-term speculative traders in both directions - bull and bear - in 2011. If you're short volatility in 2011 you're going to get trashed. The corporate leverage index will become realized risk in 2011.  I expect more than one extreme "crash-like" move during the year - the bad news is that not all of them will retrace. "Buy the dips" has been good for 18 months. Do it at the wrong time in 2011 and you're dead, especially if you're levered (and from the margin stats at present, a lot of people are. Hint: Take that risk down NOW!)

The potential for a regional war to break out is extremely high. I won't score this one, because I only give it a 50/50 chance.  But 50/50 is so far beyond the usual boundary of risk for these events that it deserves mention.  The most-likely and obvious place it happens?  North Korea - but that's not the only flashpoint.  I'm very concerned about a number of other areas across the globe including some that are off most people's radar at the moment.

• Civil unrest will spread beyond a few demonstrators in Europe. This includes the possibility of unrest in the United States. The Federal Government knows that as long as the Food Stamps and other general handouts continue they can keep a lid on things, but the fraying around the edges is apparent even now. It only takes one bad court decision or one person who is the wrong color and gets beaten in the wrong place by an overly-militarized police department to set off generalized unrest. The Federal Government's utter refusal to deal with the outrageous actions in Foreclosuregate along with bad acts by various parties, private and public (e.g. police departments) is stoking the firebox with dry tinder and spraying gasoline all over the place. All we need is a match to get lit and things will get out of control very quickly. While the Federal government should preempt state and local laws and make unfettered ownership of defensive arms available to all everywhere, the clowns in DC are too stupid to understand that when defensive force is needed in seconds to stop an arson, assault, or murder 911 will be there in 10 minutes - if the local copshop's cars aren't out of gas.

In 2007 I called upon Congress to set aside a hundred billion or two for "three hots and a cot" - literally - for up to 25% of the population for a year or more. I wasn't kidding, but now it's too late as we don't have the money, and there's zero evidence that at least in the big cities and other "liberal bastions" law enforcement understands that they cannot win against armed thugs - there are and will be too many of them. The only way peace can be maintained in such a circumstance is if the people are willing and able to help the police and that means unfettered ownership and carry of defensive arms. The radical left is beyond ridiculously wrong on this one, and we can only hope that this prediction turns out to be in error, especially if you live in a city of more than 500,000. The wise will figure out right now what they're going to do (and "shelter in place" is not one of the valid choices) if this prediction turns out to be correct.

As is always the case I reserve the right to make edits up until 1/1/2011 @ 11:59 PM - although I don't think anything's going to change in the next 48 hours in terms of my outlook."

"Wall Street's Ten Biggest Lies for 2010"

 "Wall Street's Ten Biggest Lies for 2010"
by Les Leopold

"What a great year for Wall Street: profits up, bonuses up and, best of all, criticism down, especially from Washington. Somehow Wall Street has much of America believing its lies and rationalizations. We're even beginning to forget that Wall Street is largely responsible for the economic mess we're in. So before we're completely overtaken by financial Alzheimer's, let's revisit Wall Street's greatest fabrications for 2010. (For the full story, please see "The Looting of America".) 
1."Honest, we didn't do it!" Two years ago Wall Street's colossal greed crashed our economy. Our financial elites created and spewed highly leveraged toxic assets around the globe. These poisonous "innovations" pumped up the housing bubble and Wall Street grew insanely rich in the process. When it all burst, we learned that the big Wall Street institutions that had caused the crash were far too big to fail - and too connected. High government officials came to their rescue with trillions in cash and guarantees - underwritten, of course, by we taxpayers. Everyone knew this at the time. But if you asked just about anyone on "The Street" they denied all culpability and pointed the finger everywhere else: Fannie, Freddie, the Fed, the Community Reinvestment Act, tax deductions for home buying, bad regulations, not enough regulations, too many regulations, too much consumer debt, the rating agencies, the Chinese - and on and on. Sadly, their blame-shifting strategy worked, bamboozling the media and people across the political spectrum. The GOP members of the Financial Crisis Commission are so drunk with this Kool-Aid that in their minority report, they refuse even to use the words "Wall Street" or "speculation" in assessing the causes of the crash. Hypocrites? Crooks? Morons? Take your pick. 

2. "The overall costs will be incredibly small in comparison to almost any experience we can look at in the United States or around the world." Ever since Treasury Secretary Timothy Geithner screwed up his tax returns we knew he was numerically challenged. But his statement to Congress on December 16, 2010, on the cost of the bailout shows a willful inability to count. Yes, Wall Street has paid back most of our bailout funds. Whoopee! Our economy is in shambles, and millions of people are suffering. With his offensive "no big deal" analysis, Geithner glosses over all this human misery, and sidesteps the hidden costs of the bailout, including the financial insurance we taxpayers provided to every giant financial company in the country via the Fed. On the open market, that insurance - which guarantees trillions of dollars in toxic assets - would come at a very steep price. We coughed it up for free. But that's still chump change compared to the human costs of the worst employment crisis since the Great Depression - the lost income, the depleted savings, the ravaged neighborhoods. Then there's the capsized state and local budgets, the public service reductions, the laid off teachers, firefighters and police officers - all resulting from a plunge in public revenues caused by Wall Street's crash. Why aren't these costs on Geithner's balance sheet? A cynic might think Tim was priming us to accept the latest round of Wall Street bonuses. Hey - they paid us back, so why should we care how much they earn?

 3. "It's a war. It's like when Hitler invaded Poland in 1939." Steven Schwarzman is supposed to be brilliant. After all, he made billions as head of the Blackstone Group, a private equity company and hedge fund. But last August, as some members of Congress mulled about eliminating a very lucrative tax loophole, he suffered a mental meltdown and saw an impending Nazi invasion. But the awful attack never happened. Schwartzman and his fellow hedge fund honchos all held onto their unbelievable tax break: Hedge fund and private equity income is still only taxed at 15 percent rather than at the top income tax rate of 35 percent. (That's because, inexplicably, it's considered "capital gains," not income.) Taxing Schwartzman's income as income would cost him hundreds of millions of dollars - and the prospect of this apparently triggered a shock spasm that catapulted his foot into his mouth. I'm sure my IQ isn't high enough to keep up with the genius logic behind Steve's analogy. But just who is Hitler and who is Poland in his scenario? Maybe in his grandiose conceit, his firm is as big as Poland? Or it would require a Blitzkrieg to wipe out his tax loophole? In reality, even if Schwarzman had to pay a 90 percent tax rate (as he would have under Eisenhower), it would hardly have been a hardship - let alone World War 3. He'd still have more money than he could ever spend in his lifetime. Schwarzman should be proud though: He gets 2010's Dumbest Wall Street Quote of the Year Award. Bravo! (In 2009 the honor went to Lloyd Blankfein, CEO of Goldman Sachs, who claimed he was "doing God's work."

4. "The hard truth is that getting this deficit under control is going to require some broad sacrifice, and that sacrifice must be shared by employees of the federal government." But not by Wall Street. President Obama words of November 29th came only days before he "compromised" with the Republicans to continue the Bush tax cuts for the super-rich and to bestow an enormous estate tax gift to the 6,600 richest families in America. Mr. President, the "hard truth" is that you're slapping around public sector workers because you don't have the nerve to take on Wall Street. If you had the guts, you could raise real money by going to war with Steven Schwartzman and eliminating the hedge fund tax loophole. By the way, closing that loophole for just the top 25 hedge fund managers would raise twice the revenue than you'll get by freezing the wages of all two million federal workers! (See "The Wall Street Tax Debate that Never Was")

5. "25 hedge fund managers are worth 658,000 teachers." Nearly everyone on Wall Street sincerely believes that they are "worth" the enormous sums they "earn." You see, their pay is determined by the market, and markets don't lie. They reflect the high value our skilled elites bring to the economy. So we shouldn't be shocked that the top 25 hedge fund managers together "earn" $25 billion a year, even at a moment when more than 29 million Americans can't find full-time work. The outrageous economic logic of Wall Street compensation has those 25 moguls taking home as much as 658,000 entry level teachers (they earn about $38,000 per year). How can that be justified? It can't. These obscene "earnings" are the product of 30 years of financial deregulation, as well as the tax cuts and tax loopholes that our government has just extended. The hedge fund honchos get most of their money by siphoning off wealth from the rest of us, not by creating new value. I dare Wall Street to prove otherwise.
 6. "To bolster the economy we need... an improvement in the relationship between business and government (the current antagonism, even if not the primary explanation for slow hiring and sluggish investment, does seem to be affecting hiring and other business behavior)." In this op-ed, Peter Orszag, Obama's former budget director, parrots the Wall Street line that employers aren't hiring because of "regulatory uncertainty." Mother of God, how much more certainty do they want? The Republicans and Blue Dog Democrats aren't about to let Obama seriously regulate Wall Street, even if he wanted to, which he doesn't. The truth is that employers aren't hiring because there's insufficient consumer demand for goods and services. But at least Peter Orszag is a man of his word. He personally plans to "improve the relationship between business and government" by tapping his government contacts at his new fat job at Citigroup, the nearly failed mega-bank that he helped to save at taxpayer expense. Orszag could have landed a coveted professorship at just about any university in the world. But apparently the 42-year-old wiz kid prefers Citigroup's multi-million dollar compensation package. Any bets on how long it takes for Larry Summers to cash in?

 7."Lengthened availability of jobless benefits has raised the unemployment rate by 1.5 percentage points." You see, the unemployed cause their own unemployment, at least if you believe this assessment from a March 17th research note from JP Morgan Chase. (Next, Wall Street will call for a return of the Poor Houses.) The theory is simple - you give people money not to work and they won't look for jobs. Still, it takes chutzpah for JP Morgan Chase, the beneficiary of billions of dollars in taxpayer largess, to criticize the unemployed for not finding jobs that aren't there, precisely because JP Morgan Chase helped to destroy them! Dear JP Morgan research staff: Five to six workers are now competing for every available job. If that's too complicated for you quants to grasp, maybe you should try a game of musical chairs in the trading room.

8. "Private employers, led by our revitalized financial sector, will create the jobs we need - that is, if the government would just stay out of the way." We now need 22 million new jobs to get us back to full employment (5 percent unemployment). In addition, each month the economy must generate another 105,000 jobs just to keep up with new entrants into the workforce. To get to full employment, the private sector would have to create about 630 firms the size of Apple (35,000 employees each). These numbers don't lie. Does anyone on Wall Street really believe that the private sector alone can pull off this miracle? But really, why should they care? They've got theirs, thank you very much. The painful truth that both Wall Street and Washington refuse to face is that if the big, bad government doesn't fund or create millions of new jobs, we'll face crippling unemployment for decades to come.
9. "Tim Geithner extolled 'the benefits of financial innovation' to the American economy." (Wall Street Journal, August 4, 2010) Sorry to beat up on Tim again, but it's sometimes hard to tell who he's working for. Whenever you hear the phrase "financial innovation" put your hand on your wallet. That's the phrase Wall Street uses to justify its casinos and its outlandish profits and bonuses. People who talk about "financial innovation" are either getting big bucks on Wall Street, want more bucks on Wall Street, or hope to get a job on Wall Street the nano-second their public service ends. My question for Tim is: If Apple creates iPhones, what does Wall Street create? Warren Buffett says it creates "financial weapons of mass destruction." Paul Volcker, Reagan's Fed Chair, said there is not a "shred of evidence" that "financial innovation" is beneficial. Volcker also believes that the economy "was quite good in the 1980s without credit-default swaps and without securitization and without CDOs." Volcker gets the Smartest Wall Street Quote of the Year Award: "The most important financial innovation I've seen in the last 25 years is the automatic teller machine." How could Tim get it so wrong?

10. "I'm shocked, shocked to find that gambling is going on in here." Okay, okay, Claude Raines said that in Casablanca, not on Wall Street. But Wall Street and its defenders say exactly the same thing about their opaque derivatives games. Louise Story's excellent piece in The New York Times shows how a handful of banks have cornered the market clearinghouses for derivatives - entities that are supposed to make derivatives less risky. The big banks are limiting competition, according to Story, because they "want to preserve their profit margins, and they are the ones who helped write the membership rules." Meanwhile, Wall Street is quietly pushing to exempt its most profitable derivatives from even these rigged exchanges. So don't be "shocked, shocked" when Wall Street crashes again and we're asked to foot the bill. And that's when, not if."
And for all that, they seem to have forgotten what inevitably happens to porkers...
Happy New Years, Wall Street!

Thursday, December 30, 2010

"Fox Mulder"

“Dreams are the answers to questions that we haven't yet figured out how to ask.”
- "Fox Mulder"

"A Look to the Heavens"

 "In this beautiful celestial still life composed with a cosmic brush, dusty nebula NGC 2170 shines at the upper left. Reflecting the light of nearby hot stars, NGC 2170 is joined by other bluish reflection nebulae, a compact red emission region, and streamers of obscuring dust against a backdrop of stars. 
Click image for larger size.

Like the common household items still life painters often choose for their subjects, the clouds of gas, dust, and hot stars pictured here are also commonly found in this setting - a massive, star-forming molecular cloud in the constellation Monoceros. The giant molecular cloud, Mon R2, is impressively close, estimated to be only 2,400 light-years or so away. At that distance, this canvas would be about 15 light-years across."

Daniel C. Dennett

“We used to think that secrecy was perhaps the greatest enemy of democracy, and as long as there was no suppression or censorship, people could be trusted to make the informed decisions that would preserve our free society, but we have learned in recent years that the techniques of misinformation and misdirection have become so refined that, even in an open society, a cleverly directed flood of misinformation can overwhelm the truth, even though the truth is out there, uncensored, quietly available to anyone who can find it.”
- Daniel C. Dennett

“Forget Mars and Venus: Men and Women Are On the Same Planet”

 “Forget Mars and Venus:
Men and Women Are On the Same Planet”
By Richard Alleyne

“The self-help bestseller, published in 1992, suggested that when it came to relationships men and women thought and acted very differently – in other words it was as if they came from different planets. But new scientific research shows we actually act very similarly when we are in love – whether we are male, female, heterosexual or homosexual.

Professor Semir Zeki and John Romaya at University College London looked at brain activity during a love affair. They asked 24 volunteers to view pictures of their romantic partners, as well as pictures of friends of the same sex as their partners but to whom they were romantically indifferent. At the same time their brains were scanned with functional magnetic resonance imaging (fMRI). The subjects varied in age from 19 to 47, with their relationship lengths varying from 4 months to 23 years. Half of the subjects were female (6 heterosexual and 6 homosexual) and half were male (6 heterosexual and 6 homosexual).

All reported being passionately in love and in a sexual relationship with their partner. All of the study participants were asked to rate their feelings towards their romantic partners both before and after scanning. The results showed a very similar pattern of activity between the different groups and involved activation of both cortical and subcortical areas, mainly in areas that are rich in dopaminergic ("feel good") neurotransmitter activity. These areas included the hypothalamus, ventral tegmental area, caudate nucleus and the putamen, as well as the insula, hippocampus and anterior cingulate cortex.

Dopaminergic activity is strongly linked to other neurotransmitter activities – such as those mediated by oxytocin and serotonin – which are thought to be important in regulating emotional relationships and bonding between individuals. The studies also showed that love could be blind. It found there is extensive deactivation of large parts of the cerebral cortex when lovers view pictures of their romantic partners. The deactivated areas involve parts of the brain thought to be critical in judgment.

Professor Zeki said: “Passionate romantic love is commonly triggered by a visual input and is an all-consuming and disorienting state. "Previous studies have demonstrated that despite the complexity of this emotion, the brain patterns triggered when viewing the face of someone you’re in love with are limited to only a few, though richly connected, brain regions”.

Professor Zeki said that the study was influenced by a reading of the world literature of love, from Plato to Shakespeare, Dante, Rumi, Verlaine and others, in which very similar sentiments are expressed whether in the context of opposite or same sex relationships – and that this ambiguity is reflected in the results. The research was published in the journal “PLoS One.”

Christopher Hitchens

“My own view is that this planet is used as a penal colony, lunatic asylum and dumping ground by a superior civilization, to get rid of the undesirable and unfit. I can't prove it, but you can't disprove it either. It happens to be my view, but it doesn't challenge any of the findings of Darwin or Huxley or Einstein or Hawking.”
- Christopher Hitchens

Psychology: "The Illusion of Truth"

 "The Illusion of Truth"
by PsyBlog

"We see ads for the same products over and over again. Politicians repeat the same messages endlessly (even when it has nothing to do with the question they've been asked). Journalists repeat the same opinions day after day. Can all this repetition really be persuasive? It seems too simplistic that just repeating a persuasive message should increase its effect, but that's exactly what psychological research finds (again and again). Repetition is one of the easiest and most widespread methods of persuasion. In fact it's so obvious that we sometimes forget how powerful it is.

People rate statements that have been repeated just once as more valid or true than things they've heard for the first time. They even rate statements as truer when the person saying them has been repeatedly lying (Begg et al., 1992). And when we think something is more true, we also tend to be more persuaded by it. Several studies have shown that people are more swayed when they hear statements of opinion and persuasive messages more than once.
Easy to understand = true: This is what psychologists call the illusion of truth effect and it arises at least partly because familiarity breeds liking. As we are exposed to a message again and again, it becomes more familiar. Because of the way our minds work, what is familiar is also true. Familiar things require less effort to process and that feeling of ease unconsciously signals truth (this is called cognitive fluency). As every politician knows, there's not much difference between actual truth and the illusion of truth. Since illusions are often easier to produce, why bother with the truth?

The exact opposite is also true. If something is hard to think about then people tend to believe it less. Naturally this is very bad news for people trying to persuade others of complicated ideas in what is a very complicated world. Some studies have even tested how many times a message should be repeated for maximum effect. These suggest that people have the maximum confidence in an idea after it has been repeated between 3 and 5 times. After that, repetition ceases to have the same effect and may even reverse. Because TV adverts are repeated many more times than this, advertisers now use subtle variations in the ads to recapture our attention. This is an attempt to avoid the fact that while familiarity can breed liking, over-familiarity tends to breed contempt.
When repetition fails: Repetition is effective almost across the board when people are paying little attention, but when they are concentrating and the argument is weak, the effect disappears (Moons et al., 2008). In other words, it's no good repeating a weak argument to people who are listening carefully. But if people aren't motivated to scrutinise your arguments carefully then repeat away with abandon—the audience will find the argument more familiar and, therefore, more persuasive. This suggests we should remain critical while watching TV adverts or the message will creep in under our defences. You might think it's better to let the ads wash over you, without thinking too much, but just the reverse is true. Really we should be highly critical otherwise, before we know it, we're singing the jingle, quoting the tag-line and buying the product.

When the argument is strong, though, it doesn't matter whether or not the audience is concentrating hard, repetition will increase persuasion. Unfortunately I find it's often people with the best arguments who don't repeat them enough.

Persuading groups: When people are debating an issue together in a meeting, you can see a parallel effect. When one person in a group repeats their opinion a few times, the other people think that person's opinion is more representative of the whole group (see my previous article: loudest voice = majority opinion). The same psychology is at work again: to the human mind there is little difference between appearances and truth. What appears to be true might as well actually be true, because we tend to process the illusion as though it were the truth

It's a depressing enough finding about the human ability to process rational arguments but recent research has shown an even more worrying effect. We can effectively persuade ourselves through repetition. A study has shown that when an idea is retrieved from memory, this has just as powerful a persuasive effect on us as if it had been repeated twice (Ozubki et al., 2010). The aspiring sceptic, therefore, should be especially alert to thoughts that come quickly and easily to mind—we can easily persuade ourselves with a single recall of a half-remembered thought."

The Daily "Near You?"

Doha, Ad Dawhah, Qatar. Thanks for stopping by.

Psychology: "Why New Year's Resolutions Don't Work"

 "Why New Year's Resolutions Don't Work"
by Michael Bader, D.M.H.

"New Years resolutions don't work. Oh, I suppose that there are some people who are able to use the occasion to alter something in their lives. But, generally, they - we - don't change simply because we resolve to do so. The reason for this is simple, but if people really understood it, they would have to radically change how they view themselves and others.

The reason that New Year's resolutions don't work is that we have unconscious resolutions not to change. For every conscious resolution to lose weight, stop drinking, save money, call your Mom more often, control your temper, or finish that project, there are unconscious commitments to keep things exactly the way they are. But if we accept that, then we would have to accept the pervasive power of the unconscious mind in our everyday lives, in both health and illness, a perspective that unfortunately runs counter to prevailing cultural norms that have rejected psychoanalytic ideas, idealized biology, and maintained destructive American ideals of personal and moral responsibility.

Here's the real story behind the well-documented failure of New Year's resolutions: We don't develop self-destructive behaviors because we're weak, or because "they just became a habit," or because everyone around us was doing them, or because of our neurobiology or heredity. The meaning of these behaviors is unconscious and we develop them because they serve unconscious beliefs and needs. These beliefs and needs are important, albeit unconscious, building blocks of our identities. They provide a sense of unconscious safety, and changing them is unconsciously experienced as dangerous.

For example, Sheila was a binge eater who gained and lost hundreds upon hundreds of pounds, went on (and failed at) dozens of diets, made untold resolutions on New Year's day that were abandoned a month later. Growing up, Sheila felt lonely and disconnected. Eating gave her momentary relief from feelings that were too painful to tolerate for very long. Giving up binging meant facing these painful states and she believed that the consequences of such awareness would be emotionally catastrophic. This entire sequence of lonely = binging = momentary relief, as well her belief that she couldn't tolerate becoming mindful of her eating was outside her conscious awareness most of the time, an awareness that, instead, relentlessly drove her to one unsuccessful diet after another. There isn't a psychotherapist alive who hasn't seen this pattern.

Bob was a procrastinator who couldn't seem to write the thesis necessary for him to graduate college. He made repeated vows to get more organized and focused but couldn't seem to do it. He tried treating his problem with stimulants, hypnosis, and behavioral conditioning to no avail. He thought of himself as a "lazy fuck-up" and saw no reason why he couldn't just use his willpower to resolve to change. There was a reason, however, but it was an unconscious one. At a level quite outside his awareness, Bob was afraid that if he gave up a role, however painful, that he knew, he'd be successful and independent in a way that was not only unfamiliar but also quite frightening. If confronted with this fact, Bob (and others) would say you were crazy. But that's the rational, conscious mind speaking. From the point of view of Bob's unconscious mind, it was quite understandable. Bob had grown up experiencing his parents as frustrated and disappointed in their own lives. Despite their exhortations for him to succeed, Bob developed the unconscious belief that if he were successful and independent, he would hurt them and leave them behind. He was afraid, then, on an unconscious level, of fulfilling his New Years resolution.

The examples are endless because the vicissitudes of the unconscious mind are endless. And, yet, most of us can't accept that we even have an unconscious mind, much less that it plays such a profound role in thwarting our highest aims. Perhaps, as Freud said, it's a blow to our narcissism. Perhaps it undermines our sense of moral agency and responsibility. Perhaps we're afraid that if we do believe in it, explore and try to understand it, that our worst fears about ourselves will be confirmed. Whatever the reasons, we live in a culture that increasingly regards the irrefutable ubiquity of unconscious conflict as if it were a laugh-line from a Woody Allen movie. Neurobiology is king. At best, we meditate and at worst we medicate.

The alternative does not have to be 10 years of psychoanalysis. But it does have to start with a compassionate curiosity to the real forces that motivate our behavior and, more important, that inhibit and resist our development. By denying the unconscious, we are truly losing our minds."

"Americans Turn To Technology To Control Impulsive Behavior"

 "Americans Turn To Technology To Control Impulsive Behavior"
by Leanne Italie

"Dan Nainan can't trust himself to work at his computer without clicking on distractions, so he uses an Internet-blocking program to shut down his Web access twice a day. "I'm sorry, but try as I might, I could never, ever do this on my own," said the New York City comedian who's struggling to finish a book. "I wish I could, but I just don't have the discipline." Nainan's system of two, two-hour blocks is one example of how Americans are trying to control their impulses using technology that steps in to enforce good behavior. With the new year days away, many tools are now available to help people stay in line, including a GPS-enabled app that locks down texting once a car gets rolling and a program that cuts off credit-card spending. Another device monitors your workout and offers real-time voice feedback.

Have we entered an era in which electronics serve as mother, cop and coach because we can't manage our own desires? Yep, said Ann Mack, a trend-watcher for JWT Intelligence, an arm of the marketing giant. She named "outsourcing self-control" and "de-teching" as two top trends for the new year. "The thing is we're becoming more aware of these behaviors, and as a result, we're trying to seek help to circumvent some of our more base impulses," Mack said. "We're bombarded more and more with temptations on a regular basis, and it's getting increasingly difficult to deal with that."

Tools to cope with temptation are everywhere. Some car owners are voluntarily using a technology developed for convicted drunk drivers - ignition locks attached to in-car breathalyzers. Shelley Snyder, marketing coordinator for Intoxalock, said about 1.5 percent of the company's clients are voluntary, which includes parents imposing the setup on their young drivers. "I know that isn't a lot, but it is growing at a slow, steady pace," she said. One of Intoxalock's competitors, Guardian Interlock Systems, said its figures are slightly higher: 5 to 7 percent of clients are drivers voluntarily installing the equipment, with about 2 percent intended for use by teens. Also gaining ground are clients using the system permanently after they've completed court-ordered monitoring - about 1 percent of Guardian's clients in 2010, compared with none the year before. "We hope not to see these people again," said David Contreras, Guardian's vice president of operations. "It's the one product I've been associated with where I don't want to sell it to you twice."

If your drunken behavior tends to cause more remorse off the road than on, there's an app for that as well. A handful - including "Don't Dial!" and "The Bad Decision Blocker" - will cut off your access to phone numbers for up to 24 hours, the former allowing you to name a friend as gatekeeper. Another app requires the answers to math questions before allowing you to send an e-mail, the presumption being it's really hard to do math while somehow impaired.

George Distler in Orlando, Fla., developed the BlackBerry app NOTXT n' Drive after a teacher at his daughter's high school was killed when a texting motorist - an older one - crossed a median and struck her car. "I didn't even realize texting and driving was such a tremendous issue until I got into investigating it," he said. "I was challenged by my teenage daughters." Distler, who had previously developed games for the iPhone, based the app on the notion that the safest way to deal with your phone while driving is to remove temptation altogether. His NOTXT runs in the background and, using GPS, automatically restricts texting via a phone's airplane mode when a car reaches 10 mph. It deactivates when it detects the car has stopped.

The app, sold in several other counties as well, hit the BlackBerry market Sept. 3 and has been downloaded about 2,000 times. Among those downloading the app were three companies with a combined fleet of more than 1,200 trucks. Distler estimates about 48 percent of his sales are parents hoping to curtail the texting habits of young drivers. "Nobody's really going to just put the phone down and not use it," he said. "The issue is we don't police ourselves."

Another app, Slow Down, alters the tempo of your music, depending on your driving speed, on an iPhone, iPad or iPod Touch. Using GPS, the music slows if a preset speed limit is exceeded and stops completely if you're over the limit by more than 10 mph. You can have your tunes back when you slow down.

What about other areas, like overspending? Enter MasterCard's inControl program, which has one company partner in the United States, Citigroup. You can set a general cap and the bank cuts you off when you've reached your spending limit, or you can preset a monthly amount for specific purchases such as restaurant meals. Like other bank cards, you can also order up spending alerts.

Overthinking, overdrinking, overspending. What's left? Are you lonely on your runs? Adidas has extended monitoring and data collection technology for its miCoach brand to include a "coaching mode." You can choose from a variety of voices to feed information about form and speed. Mack thinks a greater awareness of how we consume has produced a growing awareness of the limits of self-control. "The spotlight has definitely been put on that," she said. "We're increasingly living in this era of mindfulness. Expect more technology coming out that saves us from ourselves."

e. e. cummings

"Once we believe in ourselves, we can risk curiosity, wonder, 
spontaneous delight, or any experience that reveals the human spirit."
e. e. cummings

Geophysics: "Why is The North Magnetic Pole Racing Toward Siberia?"

"Why is The North Magnetic Pole Racing Toward Siberia?"
by John Matson

"Finding Santa Claus's home at the North Pole is easy on a globe - just look for the point on top where all the lines of longitude meet. But that is just the "geographic" North Pole; there are several other definitions for the poles, all useful in different scientific or navigational contexts. Among the many north poles, let us rejoice that Santa Claus did not choose the magnetic pole for his home, for he would have to spend as much time moving as delivering presents.

The north magnetic pole (NMP), also known as the dip pole, is the point on Earth where the planet's magnetic field points straight down into the ground. Scottish explorer James Clark Ross first located the NMP in 1831 on the Boothia Peninsula in what is now northern Canada, and with the planting of a flag claimed it for Great Britain.

But the NMP drifts from year to year as geophysical processes within Earth change. For more than 150 years after Ross's measurement its movement was gradual, generally less than 15 kilometers per year. But then, in the 1990s, it picked up speed in a big way, bolting north - northwest into the Arctic Ocean at more than 55 kilometers per year. If it keeps going it could pass the geographic north pole in a decade or so and carry on toward Siberia. But why?

One compelling explanation appears in the December 21 Eos, the weekly transactions of the American Geophysical Union. In their "Eos" article (subscription required), and in a longer paper published earlier in 2010 in the "Journal of Geophysical Research" - "Solid Earth", Arnaud Chulliat of the Institute of Earth Physics of Paris and his colleagues venture that a twisting molten plume beneath the Artic could be the cause: "According to some recent models, plumes of less dense fluid form at the inner core boundary and subsequently rise within [a cylinder] whose central axis is the Earth's rotation axis. Such plumes undergo a strong helical motion due to the Earth's rapid rotation, a phenomenon also observed in laboratory experiments with water. In the core, helical plumes advect and twist the magnetic field lines, forming what scientists call "polar magnetic upwellings." 

Those upwellings, unloaded into the Arctic mantle, could produce intense patches of magnetic activity on the sort of decade-long timescales needed to explain the NMP's sudden acceleration. (The authors compare these patches to a kind of terrestrial version of sunspots.) And magnetic field measurements show dramatic shifts near the New Siberian Islands that seem to fit the bill.

"What happened under the New Siberian Islands at the core surface is that the rate of change of the magnetic field changed by a large amount during the 1990s," Chulliat says. That activity, he and his colleagues have found, could account for a large portion of the NMP's acceleration. But whether magnetic field changes under the New Siberian Islands and the speeding north magnetic pole ultimately arise from a twisted plume of fluid rising through the core remains unproved, Chulliat and his co-authors note. A resolution of the mystery will await better modeling, along with more data from satellites monitoring the Arctic's magnetic environment. The necessity of satellites, interestingly enough, is a consequence of the pole's recent movement - as the NMP drifts farther out to sea, it becomes harder and harder to reach the region with magnetometer-equipped aircraft."

"A Thank You Letter From Big Oil"

 "A Thank You Letter From Big Oil"
by Green Chip Stocks

"I got an interesting email today from the folks over at Oil Change International. I thought quite a few of you would appreciate the uncomfortable humor of it, so I decided to share it with you here. As all of us consider donations for the end of the year, here's one acknowledgement letter that you should receive, but won't:

"Dear average American taxpayer,

As 2010 comes to a close, your friends in the oil industry would like to acknowledge your ongoing generosity and support. Last year, in addition to the roughly $2300 you spent on gasoline, you gave us at least $10 billion in subsidies. You have our assurances that this money will be used to continue to buy your government, violate human rights, pollute your backyard and the whole planet, and greenwash our image. We're sorry about that little issue with the Gulf of Mexico, but we'd like you to believe its all gone now, and so we'll spend several tens of millions more on an advertising campaign to reassure you.

Your contributions to the oil industry are generously matched by, well, no one. You give us the most. Thanks. Over the coming year we'll keep buying your democracy, you keep giving us billions, and it'll all be good.

Big Oil"


Technology: "What is ‘Cloud Computing’?"

 "What is ‘Cloud Computing’?"
by Jason Douglass

"‘The Cloud’ – A New Buzz Word: You’ve probably begun to hear a brand new buzz word being thrown around. Maybe you caught wind of it circulating around the office or maybe that annoying cousin that you only talk to in case of technologic emergency dropped it into conversation a couple times. In all likelihood, you feigned comprehension but one thing should be completely clear by now — ‘cloud computing’ is coming.

What is ‘Cloud Computing’? Cloud computing is an internet-based computing model. This is in stark contrast to the traditional model for computing where almost all processes take place on the user’s system. The cloud, a euphemism for the internet, will provide all the software used by your computer. Users will no longer be the owners of software but rather tenants paying a subscription to use them. In addition, all processing and related data will take place in ‘the cloud’ and not on the users personal computer. Accolades have been building into a unanimous chorus and the general perception is that this new model for computing will save money on capital expenditures for hardware, software and services because users will only pay for what they use. But when has any technological innovation ever been about saving the consumer money? The answer must be a resounding never!

So what is cloud computing really? Just like global warming, cloud computing is an attempt to create an entirely new market and subsequently a brand new revenue stream for multinational tech giants while allowing them to maintain complete control of their products. In the spirit of full spectrum domination ‘The Cloud’ also has many other lucrative uses in a ‘new world order’. In an article, "How Secure is The Cloud?", an argument is made in an attempt to counter fears that ‘The Cloud’ is insecure. Having all your personal data floating around in a cloud on some unknown server(s) raises obvious concerns over security and this article attempts to ease those fear shared by IT professionals.

"Security of Cloud Computing Users: A Study of U.S. and Europe IT Practitioners", Published: 6 May 2010: "CA and the Ponemon Institute conducted a cloud security survey of U.S. and Europe IT and IT security professionals. The findings show that about half of the respondents don’t believe the organization has thoroughly vetted cloud services for security risks prior to deployment. It also showed that 55 percent of respondents are not confident they know all the cloud services in use in their organization today.

The overall study calls for a need for IT and Security professionals to embrace the cloud and help their organizations more securely adopt cloud services. Of course, the ‘security’ they mention in this study is not to be confused with a question of privacy but simply denotes the security of ‘the cloud’ in terms of system exploits. While this allows protection from hackers, data is ultimately left wide open for the new war on terror spearheaded by events like wikileaks cable leaks. In other words, your information will be even more easily available to those agencies policing the web in the name of security.

Recently, examples of abuse have been uncovered where the FBI is under suspicion of planting backdoors in OpenBSD IPSEC stack. As if it weren’t completely obvious that our government is tightening the reins, these moves show the real motives behind our government’s involvement in technology development."

The Final Unveiling of the Control Grid: We are moving in a dangerous direction. The current incarnation of the internet is far too open for our controller’s comfort. So a new internet is being rolled out; one that will control its users absolutely. All computing will be done offsite and instead of policing individual users, which often sounds illegal, government agencies can just surveil the ‘anonymous’ cloud. Of course, they already know exactly who you are and will soon be able to remotely kill your computer at will. I don’t know about you but I feel much more ‘secure’."
Related article: "Cloud Computing Makes FBI Access to Documents Easy"

"How It Really Is"