Archive for the ‘Politics’ Category
Online Filter Bubbles
Check out this very interesting video from Eli Pariser at a February 2011 TED Event. Very interesting on how search engines, content providers and other web providers are giving you what they think you need versus what you actually want. Eli makes a very interesting case that as web companies strive to tailor their services (including news and search results) to our personal tastes, there’s a dangerous unintended consequence: We get trapped in a “filter bubble” and don’t get exposed to information that could challenge or broaden our worldview. Eli argues powerfully, that this will ultimately prove to be bad for us and bad for democracy.
Faux job numbers could lead to real trouble
Here is a VERY interesting article regarding the manipulation of the U.S. Job numbers and the potential consequences of publishing false numbers. Check it out. I have placed the article here for you to read. Something worth considering. Especially if you have an interest in what the Fed does with interest rates.
-DF
By JOHN CRUDELE
Last Updated: 12:54 AM, April 12, 2011
Posted: 12:00 AM, April 12, 2011
Deception is a dangerous thing. You never really know when a lie may turn on you.
Take, for instance, the Labor Department’s annual springtime boost in the faux jobs market. While it’s nice that the government thinks there is an employment boom coming, this won’t be a good development if that boom turns out to be imaginary yet still causes the Federal Reserve to prematurely tighten credit conditions.
Let’s start from the beginning.
Early this month Labor reported that 216,000 new jobs were created in March. It was better than Wall Street expected.
But the figure included 117,000 jobs that the department thinks, but can’t prove, were created by newly formed companies that might not even exist. In fact, the department is getting so optimistic about the labor market that it increased this imaginary job count from just 81,000 in March, 2010.
As I’ve been telling you for months, the spring always causes the Labor Department to goose its job-creation numbers. And maybe sometime in the future this process will be warranted. But during 2009 and 2010 these springtime assumptions — which are officially called the Birth/Death Model by Labor — led to major errors in the annual job count.
The next three months should be doozies. In April 2010, the Labor Department guessed that 188,000 jobs were created by these newly formed, maybe nonexistent companies; last May’s total job number was jacked up by a 215,000 guess, and June got an artificial boost of 147,000 jobs.
This year, Labor will likely be inserting even bigger faux job totals for each of those three months. In other words, you still might not be able to get a job in the real world, but there should be plenty of fake jobs for the newspapers to write about and the politicians to brag about in speeches. Why should you care?
If you are just a regular person reading this column you should be appalled that Washington has trouble getting its numbers right. But wait, there’s more. Interest rates have already been rising because (and I don’t need to tell you this) inflation is a problem. Mortgage rates, for instance, have moved three-quarters of a percentage point higher over the past six months. And that’s without the Federal Reserve purposely tightening credit conditions. The next three months’ job figures — if they are as strong as I think they will be — could give the Fed a compelling reason to, at the very least, end the money-printing operation it calls Quantitative Easing. And it may even have to start talking about raising interest rates. That won’t be good news for either bonds or stocks, the latter of which have been on a truly unbelievable ride upward. Remember the first investment advice you received (probably from your mom or dad): if it’s too good to be true, be suspicious. It’s gonna get exciting especially when you see what happens by summer. (But that’s for a future column.)
Is the federal government like one of those hoarders you see on TV? It buys into projects and programs (resulting in a clutter of $12 trillion in debt) but is pained when it needs to get rid of just $39 billion of those programs. The government is a mess — just like the homes you see on TV. And the picture isn’t going to get any prettier when someone, at some time, tries to get the government’s house in order. – Home sales are still plunging, and prices are going down, down, down. Well, maybe it’s time to listen to John (that would be me). Change the rules on retirement plans so the American people can rescue the ailing real estate industry, which, by the way, will take a decade to fix if left on its own.
Let people withdraw a relatively small percentage of the $15 trillion in retirement funds to purchase real estate. Give them a tax break — maybe even a big one. And smack Wall Street down when it voices the inevitable opposition to this plan. (Remember, the money I’m proposing to be used for this idea is now in retirement plans mainly invested in Wall Street products.) Maybe it is time for a plan that’s reasonable and doesn’t risk bankrupting the nation or ruining our currency.
Ya know, I’m just thinking out loud.
The End of the Dollars Reign
The end of the U.S. dollar’s reign as the world reserve currency. This issue has been of strong interest to me for the past 5 years. Why? Because of the cataclysmic impact it would have on U.S. Businesses, the U.S. economy, and ultimately you and me and our families. Let me break this down in a very simple way.
- The U.S. dollar is currently and for roughly the last 50+ yeas has been the world’s reserve currency.
- This means when Non-U.S. businesses want to buy, import, export, or sell things globally, they have to first purchase U.S. Dollars in which to conduct the transaction. this is expensive for them.
- When global companies price products for the global markets i.e. OPEC, they do so in U.S. Dollars.
- There are many reasons for this – stability of the dollar, the track record of the U.S. of honoring its debt, treasure bonds, U.S. economic strength, etc.
- A huge advantage of being the United States is that since our currency is the standard, we do not have to purchase U.S. dollars to conduct business in the U.S. or globally. We don’t have to include huge risk and fluctuations of world currencies in our business transaction, the U.S. consumer is not directly subjected to global currencies fluctuations on a large daily scale. We don’t have to sell dollars to buy Yuan, Peso’s, etc. and absorb the currency difference and then sell or buy in Yuan’s, etc.
- This is one of the perks of being the worlds largest economy and economic leader….. until now.
With China and India becoming huge economies, # 2 and #3 respectively behind the U.S., it is predicted by many that in the next 10-20 years, China will surpass the U.S. and then in 10 years further, India will surpass China as the worlds largest economy. Already with huge deficits in the U.S., inflation creeping in, the cost of U.S. goods going up across the board, things are already precarious. If the U.S dollar was to be devalued further by say 20% and/or the world decides to use multiple currencies as the currencies reserve i.e. Chinese Yuan’s or Euros instead of OR in addition to the dollar, things could get real bad for a fragile U.S. economy and the impact on U.S. business and consumers could be cataclysmic.
The cost of everything we do, build, buy, sell, earn, etc. would sky-rocket to a proportion unimaginable. No this isn’t a doomsday prediction. Its reality. Already, China, Russia, France, Brasil, the World Bank, OPEC and others are all calling for and openly discussing moving away from the U.S. dollar as the worlds currency reserve. This is real folks and will most likely happen in the next 5-10 years. I personally believe the EURO and Yuan need some time to mature structurally and get its act together, but it’s coming. China and the EU are taking measures to shore up their currencies to be a viable competitor. Even having competition and multiple world currency reserves could have huge impacts for the U.S. and its people and businesses. When you look at a $14+trillion-dollar U.S. deficit, uncontrolled spending, major entitlement issues like social security, medicare, pensions, etc. unresolved and bankrupting the country, states and local governments, etc. we have our work cut our for us in the U.S. The last thing we need is a major impact to our currency status. That could be the one thing that knocks the U.S. over the tipping point of economic collapse i.e. restart and rebuild mode. The impact of that is almost unimaginable. Who will bail us out? China? No way.
Check out this related article from the WSJ where several economists from UC Berkeley discuss this very issues. Personally, I think they understate the impact to the U.S. economy, but it is a good read. Check it out here!
-DF
Experts Divided Over Google-Verizon Net Proposal
Here is an interesting article regarding Google’s and Verizon’s proposed legislation on Net Neutrality. This is a fascinating subject and I wanted to share this article from MIT’s Technology Review with you. But from my perspective, I am skeptical about anything coming out of Google that involves “legislation” considering Google’s close ties to the White House/Administration and the ongoing federal and congressional investigation. Makes me nervous. So much for a company that professes do NO harm! Hippocratic oath for Google or Hypocritical oath? Be the way, I am not anti-Google. Quite the contrary. But I am distrustful of companies that engage politically and sneaky ways. Either go for the gusto and proclaim your affiliation or shut up. But don’t sneak and slither around the back rooms. Its slimy, people don’t like it and it negatively impacts your brand.
OK, on to this article
-DF
Earlier this week, Google and Verizon released a joint proposal for legislation to govern how Internet service providers manage online traffic. Though the companies touted their support of an open Internet, the proposal has come under criticism for providing loopholes that some say could allow Internet service providers–or large Web companies–to grab an unfair advantage by prioritizing certain Web content.
The proposal has ignited a firestorm of debate around “net neutrality,” the principle that Internet service providers should not be able to prioritize how content, such as streaming video or peer-to-peer content–or traffic from a particular customer–is delivered. The debate has also centered on how companies could, by extension, limit the types of applications users can access, or what devices they can connect to a network.
The issue came to a head in April this year, when a court ruling limited the Federal Communications Commission’s ability to regulate how carriers handle traffic. The FCC had sought to stop Comcast from throttling traffic from the file-sharing service BitTorrent on its network.
Google and Verizon’s new proposal calls for the FCC to investigate claims of unfair treatment, and for a standards-setting body to outline the difference between actions that must be taken to reasonably manage network traffic and actions that stack the deck in favor of a particular party.
Both companies say that the proposal works in favor of an open Internet. Google CEO Eric Schmidt said in a press conference that the legislation “would establish a new and enforceable prohibition against discrimination for wireline and broadband Internet services, specifically, no discrimination against or prioritizing of lawful Internet content apps or services in a way that harms users or competition, no blocking or degrading of Internet content and applications.”
Some experts say the proposal could help produce a real resolution on net neutrality.
“I would hope that the Verizon-Google proposal breaks the logjam on network neutrality, by showing there is room for compromise,” says Kevin Werbach, an associate professor of legal studies and business ethics at the Wharton School at the University of Pennsylvania and founder of the technology consulting firm Supernova Group. “The proposal has problems, but it’s a real effort to find common ground between network operators and companies that innovate on top of the Internet.”
But two aspects of the document have watchdogs worried. One is a provision that would let broadband providers offer “additional, differentiated services,” that would be not be subject to the same rules as the open internet. These would possibly include “health care monitoring, the smart grid, advanced educational services, or new entertainment and gaming options.” The other is the absence of any rules regarding wireless Internet traffic. The proposal points to the “still-nascent nature of the wireless broadband marketplace” and suggests requiring carriers to be transparent to users about how they handle wireless traffic, but imposes no additional rules.
Experts have debated what these exceptions may mean and what the two companies are really proposing.
“As many others have noted, the exclusion of wireless from all but the transparency requirements is a dreadful idea,” wrote Cindy Cohn, general counsel and legal director for the Electronic Frontier Foundation in a legislative analysis of the proposal. “Neutrality should be the rule for all services, and a distinction between wired and wireless not only defies reason, it also abandons the portion of the Internet that is currently most lacking in openness and neutrality.”
Some, however, agree that the wireless arena is problematic. Mung Chiang, an associate professor of electrical engineering at Princeton University who studies the modeling, analysis, and design of networks, says that wireless carriers truly are dealing with unique problems of competition and network congestion, a trend that is only increasing as more types of wireless devices come on the market. Chiang believes it’s not a good idea to introduce regulations before the technology has solidified.
While Werbach agrees that wireless is different, he argues that the legislation needs to include conditions that would trigger the FCC to intervene once the market has matured.
Experts have also expressed concern that allowing carriers to offer additional services could undermine the public Internet. Gigi B. Sohn, president and cofounder of the advocacy firm Public Knowledge, said in a statement: “While there would be no pay for priority on the best efforts Internet, there are almost no limits on so-called ‘managed services,’ other than that they would need to be ‘distinguishable in purpose and scope’ from the Internet.”
Public Knowledge and other groups have expressed concern that carriers would have carte blanche to create special offerings that could exclude those on the public Internet.
Chiang says, however, that the Internet is already “a loose confederation of subnetworks,” and he believes it may be necessary to have special provisions for certain types of traffic. For example, it may be sensible to treat imaging data relating to an important surgical procedure differently from other traffic. He sees “nothing intrinsically wrong” with carriers creating special-purpose services, though he acknowledges the potential for abuse–if, for example, carriers used this as a way to ban competitors’ products.
Werbach agrees, saying, “There’s no perfect way to differentiate ahead of time. For example, I haven’t heard much concern that Comcast’s XFinity Digital Voice phone service, which has millions of subscribers, has undermined the open Internet. That’s a managed service that expressly discriminates and excludes other providers.”
Provided these loopholes are monitored, some see the Google-Verizon proposal as a positive move. “While most of the reaction has focused on Google,” Werbach says, “the fact that Verizon accepted enforceable nondiscrimination obligations is a major step in the right direction. Those who argue that broadband providers won’t invest without freedom to discriminate will have a much harder time making that case after this proposal.”
