6/30 Business Insider

Business Insider         I want spending, I want spending, I WANT SPENDING! June 29, 2011 at 1:43 PM   By: Daniel Becker There is some new information from Adam Hersh of Center for American Progress showing what has happened in the states that have followed the conservative economic approach (yes, talking to you Obama, DLC, Clintonites).  Keep cutting at your own risk. Here's the thing.  Like the Wile E Coyote, we seem to have run off the cliff.  Our feet are still moving like we are running because we have not noticed we are off the cliff.   Or I should say those in the lofty parts of our power house and economy have not noticed.   Now, in cartoons, sometimes the charater makes the realization and can scramble back to safety at the edge of the cliff.  However,  Wile E never did get it and always fell. I'm not interested in being taken down by Senator, Represenative, President, Chairman Wile E Coyote.  No thank you.  I know we're off the cliff as do the vast majority of not only the USA but it seems the rest of the 1st world nations.  So listen up Wile E.  We're not following you any more ( I hear you Greek patrons).  Not going to try to catch that road runner your way anymore.   And here is why: Relative to national economic trends, states that increased spending enjoyed on average: 0.2 percentage point decrease in the unemployment rate 1.4 percent increase in private employment 0.5 percent real economic growth since the start of the recession. In contrast, states that cut spending saw on average: 1 percentage point increase in the unemployment rate 2.1 percent loss of private employment 2.9 percent real economic contraction relative to the national economic trend. So, I hope the IMF is happy now.  I have to be honest, the study does note: The three figures presented in the accompanying charts demonstrate that steep state government spending cuts have gone hand-in-hand with rising unemployment, falling private-sector payroll employment, and lower real growth in states' gross domestic product, or GDP—the sum of all goods and services produced by labor and equipment in each state, minus imports. The analysis, however, does not tell us whether the spending cuts caused the negative economic outcomes. But in all three cases, steep spending cuts are statistically associated with markedly worse economic performance. There are some nice charts at the linked article if you are more visual.  Personally, I feel this new info just further supports my position that people are not drowning (debt is not money and thus not water), they are dehydrating.  We need more of the water that already exists.  It's the income inequality issue.  I am rather certain that more government cutting has no chance, zero chance of reversing the inequality.  If we can't reverse the inequality, then we're going to continue with what I pointed out in 2008.  That is, the top is taking money from the economy as income faster than the economy can produce it.  Can you keep spending more than you make?  No, is the conservative answer.  Well, can you keep taking it faster than you can produce it?  No, is the liberal/progressive answer.  The issue is not that we are spending too much via government because the government is not just another player in the economy.  As I have noted, as long as the government acts counter to the players in the economy and does so in a manor that assures equality and the reduction of risk in living, it is not a competitor.  It does not "crowd out" the private sector.  This leaves the real issue of a stalling economy, and declining living security one of  to much money being taken out of the economy.  For decades as noted, one group has been taking too much money out of the economy and have been doing it at ever increasing rates: the top 1%.  They are doing it faster than the economy can produce it.  This, as far as I am concerned is no different than government cutting spending.  Either way, money is taken out.  Velocity is what we are talking; how much and how fast money is moving through the economy.   Of course to understand such, one has to appreciate that Wall Street, banks, and markets are not an economy.  This is why the government, acting to fulfill it's prime purpose of equality of power is never a competitior in the economy. So, how convienent the conservative issue is debt.  Too much of it they say.  Too much spending.  HA!  The real debt is in the lack of income to everyone other than those in the top 1%.  They took and are taking so much money out of the system in the form of income (decrease union membership, tax cuts, off shoring, financialization, consolidation) that they have damaged the machine which allowed them to have growing income.  This is the real debt.  It is the lack of economic growth.  And the rich have caused it.  Yet there solution is to cut government spending and further reduce the amount of money in the active (remember velocity) part of the economy all the while taking even more out as income in their pockets? Do you see how nuts Wile E Coyote is?   Read more posts on Angry Bear » Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         Pawlenty Campaign In Trouble In Iowa June 29, 2011 at 1:42 PM   2012 Republican presidential candidate Tim Pawlenty expects to spend $1.75 million to win the Iowa Straw Poll, The Daily Beast reports today. The straw poll has emerged as a crucial test in Pawlenty's candidacy. But after falling far behind both Michele Bachmann and Mitt Romney in Saturday's Des Moines Register Poll, Pawlenty has tried to downplay expectations for his performance in the August 13 straw poll. "I don't know that we need to win it," Pawlenty said in an interview with an Iowa radio host yesterday. The former Minnesota governor is having difficulty raising the money necessary to compete in the straw poll, according to a GOP consultant familiar with the Pawlenty campaign. “They clearly don’t have it," the consultant told The Daily Beast. "So in the end I’m not sure how they’re going to implement their straw-poll strategy." “I know so many of the vendors who aren’t getting paid," he said. "They are holding back so many bills.” Please follow Politics on Twitter and Facebook. Join the conversation about this story » See Also: Bachmann Surges In Iowa Poll "Queen Of The Tea Party" Michele Bachmann Begins Presidential Campaign Romney Takes Early Fundraising Lead, Pawlenty Nearly Out Of Cash, Gingrich Is Broke         More American Companies Bring Factories Back Home From China June 29, 2011 at 1:41 PM   The new trend for American manufacturing companies is bringing your factory back to the good old U.S. of A, says a CNN report. Mark Krwyko, the owner of Sleek Audio, decided to move his factory from Florida to Guangdong province in 2007. His experience, he said, was less than desirable. "Even though there's a tremendous cost savings when you go to China, in the end it really isn't that much," says Mark Krwyko, the owner of Sleek Audio, a company that manufactures headphones. "It's the hidden costs -- the delays, the shipping costs, you pick all that up on a learning curve." There were issues with product quality and communication, he found the travel too taxing as the cost of manufacturing kept rising, and he was almost put out of business when a shipment of 10,000 earphones were ruined. That foible cost him millions. So Krwyko shopped around the U.S., and he found that the recession had lowered costs enough to make keeping his factory in the U.S. worth his while. He's not the only one, says CNN. China is a hassle and that they want to bring their operations closer to home, where the recession has lowered costs, created workers eager for jobs, and made it easier to justify U.S. manufacturing. Reports have emerged from California, Texas and all across the country as small businesses -- and even large ones like GE (GE) and Caterpillar (CAT) -- take advantage of local incentives and move back at least some of their manufacturing operations for products sold in the U.S. market.   Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: These Are The States That Would Get Crushed In A Trade War With China Stock Gets Clobbered Just On The Rumor Of A Muddy Waters Research Report China Just Put A Number On Its Local Government Debt Media Files china-factory.png (PNG Image)         Expert: Dismantling a company's takeover defenses can lead to serious implications June 29, 2011 at 1:38 PM   The report, titled ‘Proxy season wrap-up: successful activism dismantles takeover defenses,’ released by GovernanceMetrics International (GMI), indicates that the prevalence of ‘poison pills’ used by S&P 500 companies to discourage ‘hostile’ takeovers declined to 16 percent last year – a significant reduction since 2002 when more than half of companies used this technique. ‘The changes in takeover defense proposals appearing on proxy statements seem to be driven by several factors,’ says Beth Young, senior research associate and author of the report. ‘In addition to successful shareholder activism, companies may be more willing to settle takeover defense proposals rather than allow them to appear on the proxy statement.’ [Click here for the chart] Conversely, Sanjay Shirodkar, of counsel to DLA Piper’s public company and corporate governance practice, points out that there has been a marked increase in the number of ‘hostile’ approaches since the beginning of last year. ‘Potential dismantling of a company’s takeover defenses is an issue that can have a serious impact on a company’s long-term success. Such decisions merit thoughtful and thorough analysis of many different issues and are best undertaken with the assistance of competent advisers.’ Shirodkar adds: ‘Over the course of the past ten years or so, pills and other takeover defenses have come under increasing scrutiny and many large-cap companies have reassessed their takeover defenses.’ Another key finding from the report reveals that only one-third of boards are ‘classified’, meaning that directors serve terms usually lasting between one and eight years. This remains the lowest proportion since GMI started tracking the data. ‘Boards may feel uncomfortable being too far outside governance norms, so as more companies declassify, pressure increases on the holdouts to follow suit,’ the report says. Shirodkar compares this finding to his review of annual meetings over the past year. ‘Based upon information we have reviewed for annual meetings scheduled between June 30, 2010 and June 23, 2011, we believe that over 51 companies have faced shareholder proposals to eliminate classified boards.’ Moreover, the report provides an overview of trends in shareholder proposals related to takeover defenses over the last three years. The number of proposals asking companies to give shareholders the right to call special meetings has also declined, and investors have turned to taking action by written consent much more than they have in the past. [Article by Aarti Maharaj, Corporate Secretary] Please follow Clusterstock on Twitter and Facebook. Join the conversation about this story »         European vacation June 29, 2011 at 1:33 PM   Jim Campbell, who manages $3 bn-worth of assets with a team at JPMorgan, has cut his exposure to European smaller companies heavily after a strong run by the sector. He and his colleagues manage a range of assets, including the £500 mn ($814 mn) JPMorgan European Smaller Companies Investment Trust, which can borrow to invest and focuses on non-UK stocks. The managers told shareholders on May 17 that they had reduced their borrowing from close to its maximum at the end of April to zero. Technically, gearing fell from about 117 percent to 100 percent. The higher the gearing, the more sensitive the trust’s share price is to moves in its holdings. The managers can range between being fully geared – 120 percent – to holding 20 percent cash. ‘We feel we had a very good run ,’ explains Campbell. ‘People are wary of the European smaller companies sector.’ He believes equity market investors are periodically gripped by manic emotions, which drive them to move in four cycles. The first is despair: the market moves from peak to trough as results disappoint investors’ expectations. He points to research from Goldman Sachs, which shows the worst return came at a despairing time when earnings fell by an annualized average of 7.3 percent. The second is a season of hope and falling volatility: investors expect a better future and enjoy their highest returns. The third cycle – growth – brings investors a time when earnings grow faster than the P/E multiple: earnings are at their highest and returns are still positive. Campbell believes investors are currently in this growth stage. Asked about valuations, he says Europe’s small companies are at the upper end of the range, relative to larger groups. He also says, however, that in absolute terms, valuations are cheap when valued in price-to-book terms. The fourth cycle is optimism: the P/E multiple grows faster than earnings. Returns are strongly positive and volatility increases. The next phase will be despair, which began the cycle. Experienced hand During the 22 years Campbell has been investing, he has seen what he calls a revolution in European investor relations. Companies used to release two earnings statements per year; now they put out results every quarter. Investors once had no detail about operating costs, but all that has changed. German firms used to publish annual reports in English in July; now they come out in March. ‘Investor relations is now generally good,’ says Campbell. ‘The level of disclosure has gone through the roof.’ He and his team invest for the European Smaller Companies Investment Trust in companies with market capitalizations of between £33 mn and £3.1 bn. Their picks have produced a weighted average of £1.5 bn, beating the UK average of £1.2 bn. They select stocks from a possible 1,000 firms, by backing either growth companies with strong operational momentum or value businesses with a catalyst for a rerating. The team’s biggest sectoral bet is industrial companies, which account for 33.6 percent of the fund. This decision was driven by belief in Europe’s economic recovery – the team’s confidence in these engineering groups is a change from the recent past when the sector was one of the trust’s most extreme underweight positions. ‘I was in Germany last week,’ says Campbell, who, along with his team, visits hundreds of companies every year. ‘The key factor in Germany is that the exporters have been strong beneficiaries of the weaker currency. There is also enormous demand for their industrial goods – Germany is booming as an industrial economy.’ He and Francesco Conte, the other investment manager, argue that Germany’s industrial strength has made Europe’s economic recovery much stronger than economists expected. The European economies’ ability to manufacture the products that the fast-growing emerging economies want – expensive cars, luxury goods, consumer products and state of the art capital goods needed in manufacturing processes, planes, trains and power plants – is impressive, Campbell and Conte say in a report to shareholders. Click here for the role of emerging markets >> Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         Mark Thoma Has Become a Fiery, Liberal Spirit June 29, 2011 at 1:32 PM   Mark Thoma joins Dr. Black, putting him one-up on some Liberal Bloggers Who Should Know Better.* Thoma: 1. You have to make the Republicans pay in terms of eroded public support before they will agree to cooperate at all. The president in particular has not played a long-run strategy, the Republicans have, and the results reflect this. 2. "Let's agree that what matters isn't how many jobs you 'get caught trying' to create." Why should I agree to take as given the point being debated here? When we need jobs as bad as we do right now, making it clear the other side is standing in the way of that goal, and fighting for the policies you'd like to enact has more value than it did in the past. 3. To me, this is about leaders and followers, and the administration is not the one leading policy right now. 4. The other side is not shy about going public, and that was also true when they controlled the White House. If this advice is correct, why didn't it hurt Republicans when they were in power? 5. Yes, jobs at election time would be best. But if the other side is pushing policies that work against that goal so that it is unlikely to be attained...making that clear to the public would hurt. [slightly edited; emphases mine] As Yves said, can Ezra Klein should stick to being (slightly less but still) wrong about health care? At this point, the list of Obama Administration Unforced Errors—Summers, Geithner, John Walsh, lack of nominations, etc.; see here—is so long I would be willing to swear they put a one-armed man on the tennis court. *I should be fair to Bernstein, but he perpetuates the horse droppings about "people want to see spending cuts and see them they will." The unemployed innumerate vote, sometimes, and they're not going to cheerfully vote for someone who keeps them unemployed by doing what they said they want. That's not leadership, as David Frum (whose ex-boss knew even less about leadership than BarryO does) noted.** **Frum's claim that Obama is not imaginative enough is clearly bollocks, and his toughness (as distinct from his determination) should be unquestionable too. But "not determined enough" has rung true since his Senate days, and the bad Gerald Ford imitation is wearing thin even with those who were originally nostalgic. Read more posts on Angry Bear » Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         IR Papers: Quiz edition June 29, 2011 at 1:31 PM   Questions 1. Chief financial officers get involved in material accounting manipulations because: a) They succumb to pressure from their CEOs b) They want the money 2. The quality of earnings reported by politically connected companies around the world is significantly: a) Better than that of similar non-connected companies b) Poorer than that of similar non-connected companies 3. Yale University investigators find evidence that, following the SEC’s 2003 proxy voting disclosure rule, mutual funds’ support for management equity incentive plans actually: a) Rose b) Fell 4. What effect have environmental shareholder resolutions had on the pollution management practices of US corporates? a) Positive b) Negative c) Neutral 5. How much more likely are analysts to cover local IPO firms than non-local ones? a) 25 percent b) 51 percent c) 67 percent 6. The percentage of analyst stock recommendation changes having a visible share price impact is: a) 12 b) 36 c) 100 7. Among large Hong Kong firms, good corporate governance: a) Predicts future market valuation b) Has no impact on future market valuation 8. Institutional investors sell the stock of firms that appoint women to their boards because: a) Profits tend to suffer b) They are biased against women 9. A mix of different educational backgrounds in IR teams: a) Dampens shareholder activism b) Has no effect on shareholder activism c) Is linked to increased shareholder activism. Click here for the answers! Please follow Clusterstock on Twitter and Facebook. Join the conversation about this story »         The 10 Countries Sitting On The Most Natural Gas June 29, 2011 at 1:31 PM   The nuclear disaster in Japan called has called into review the use of nuclear power, and many countries are looking into alternative forms of energy. Japan is already the world's biggest buyer of liquefied natural gas, and global primary gas demand is expected to reach 5.1 trillion cubic meters in 2035, up from, 3.3 tcm today. Much of this is set to come from non-OECD countries that will account for almost 80% of the increase in demand between 2010 and 2035, according to the International Energy Agency (IEA). The report also suggests that production would need to increase to three times the current production levels in Russia, to meet gas demand in 2035. With that in mind we've highlighted the 10 countries with largest natural gas proved reserves. Note: The data on reserves is based on 2010 estimates from the CIA World Factbook. #10 Algeria Proven reserves: 4.5 trillion cubic meters Algeria accounts for 2.37% of all proven natural gas reserves. Source: The World Factbook #9 Venezuela Proven reserves: 4.98 trillion cubic meters Venezuela accounts for 2.62% of all proven natural gas reserves. Source: The World Factbook #8 Nigeria Proven reserves: 5.25 trillion cubic meters  Nigeria accounts for 2.76% of all proven natural gas reserves. Source: The World Factbook See the rest of the story at Business Insider Please follow Money Game on Twitter and Facebook. See Also: These Are The States That Would Get Crushed In A Trade War With China The 15 Countries With The Highest Concentration Of Millionaires Goldman Sachs: BUY THE DIP (In Oil Stocks) Media Files turkmenistan-gas-field.jpg (JPEG Image)         Fair exchanges? June 29, 2011 at 1:29 PM   On first examination, exchange-traded funds (ETFs) are a good thing, and the reason for their popularity is obvious: they not only offer instant liquidity, but also lower costs. In a study conducted two years ago, Kenneth French, professor of finance at Dartmouth College’s Tuck School of Business, estimated that mutual funds’ active money managers ‘cost US investors no less than $80 bn a year – with no commensurate return over ETFs.’ Since then investors’ money has flooded toward ETFs that guarantee to meet indexed expectations, without the high charges. BlackRock estimates inflows of $67.2 bn into the funds in 2011, and most analysts expect the growth to continue. It is typical of the finance sector that what started off as such an eminently sensible product should begin to get the iridescent tinge of a bubble, as financial institutions work out how to make money from it. ETFs’ original assurance of representing direct holdings of the stocks in an index has been diluted, particularly in Europe. A recent report from the Financial Stability Board (FSB) has rung a warning bell about the rapidly evolving sector. The FSB, estimating $1.2 tn in ETF holdings in 2010 Q3, warns that even at this early stage ‘the speed and breadth of financial innovation in the ETF market has been remarkable... and has brought new elements of complexity and opacity into this standardized market.’ It also points out that ‘synthetic ETFs obtain the desired return through entering into an asset swap – such as an over-the-counter derivative – with a counterparty instead of replicating the index physically’ and adds that ‘some ETF providers are said to generate more fee income from securities lending than from their traditional management fees. Since securities lending is a bilateral collateralized operation, it may create similar counterparty and collateral risks to synthetic ETFs.’ Nor is the FSB alone in sounding a note of caution. On the macroeconomic scale, corporate governance activist Bob Monks suggests that, apart from other risks associated with ETFs, the funds represent a potentially dangerous extension of indexation into the markets. Estimating that ‘ETFs, indexes and ‘closet indexers’ among mutual funds already make up about 40 percent of the market, I’m told that if you get up to about 60 percent, there really is no market anymore,’ he points out. While French is sure ‘we have a long way to go before there are not enough active investors’, Dr Konstantina Kappou of the ICMA Centre Henley Business School in the UK concurs with Monks. ‘There is definitely an issue with the increase of passive management in capital markets over the last decade,’ she says. ‘In simple terms, if all active traders who are responsible for eliminating market inefficiencies in stock pricing disappear from the market and all we are left with is a considerable amount of indexed money handled by purely passive portfolio managers, one could argue about an increase in market volatility and misleading stock valuations.’ Kappou notes approvingly that ‘the FSB report covers all the major concerns about the recent increase in the variety of ETFs and the complexity of some exchange-traded vehicles. The regulation process needs to progress along with the market developments to protect the average investor, especially in the case of less liquid ETFs.’ Click here for the rest of the story >> [Article by Ian Williams, IR magazine] Please follow Clusterstock on Twitter and Facebook. Join the conversation about this story »         Developers Shun BlackBerry June 29, 2011 at 1:23 PM   Developers are turning away from creating new BlackBerry applications, as Research in Motion's financial and personnel woes continue. The Waterloo, Ontario-based company's declining market share and operating system complexity sapping the lure for developers. They say BlackBerry devices just aren't worth it anymore, especially when compared to the profitability of programming for Apple and Google platforms. "You have to put your resources where the growth is," said Loic Le Meur, Seesmic CEO, to Bloomberg. "It's coming down to the explosive growth of the iPhone and the Android operating systems." Developers like Seesmic, which create social media apps, and Purple Forge, maker of fan apps for the Miami Dolphins and singer Taylor Swift, say it is increasingly difficult to create apps on BlackBerry's platform due to RIM's confusing operating system and varying control methods, like its touch screen and keyboard devices. "As soon as RIM brought in a touch screen and mixed it with a thumbwheel, a keyboard and shortcut keys, it made it really difficult and expensive to develop across devices," said Brian Hurley, Purple Forge CEO. "What Apple scored big on is having a touch screen and a button and that's it." The mass migration doesn't bode well for RIM, which has fallen on hard times. The company has seen its market share fall to about 13 percent and stock prices decrease 50 percent since the start of the year. RIM failed to properly anticipate the rise of app-centric devices in the market, along with ancillary app marketplaces. And as a result, its ecosystem lacks apps that consumers now thrive upon, and losing developers further threatens its viability in the market. Investors appear fed up with the company's direction as well. Earlier this month, investment firm Northwest & Ethical proposed RIM separate its roles of chairman and CEO, and instead name an independent board member as chairman. Currently, Jim Balsillie and Mike Lazaridis, the co-founders of the company, split their executive roles, but investors feel this isn't a winning strategy. RIM announced its profits fell 10 percent from a year ago, adding that quarterly sales have dropped for the first time since 2005. As a result, the company laid off 200 workers at its Canadian headquarters last week. RIM executives have been leaving for the greener pastures of rival companies. Its vice president of marketing and media, Brian Wallace, left the BlackBerry maker to join Samsung. Earlier in the year, the company's chief marketing officer, Keith Pardy, jumped ship as well. The company's lone shining light, its new QNX operating system, is now hobbled by the news of developers leaving the BlackBerry brand. Programmers are waiting to see how well a new QNX line of "super-smartphones" sells before developing apps for the OS. But the plan poses a Catch-22, as developers won't create apps for the OS unless it sells well, but the line will be a tough sell to consumers without strong app support to rival Apple and Google's massive app markets. RIM's reluctance to update its devices and operating system, even as Apple and Google take chunks out of its market share, came back to bite it. The QNX platform appears promising, but may truly be too little, too late, especially if developers no longer believe BlackBerry is a viable option for them. This post originally appeared at Mobiledia. Please follow SAI on Twitter and Facebook. Join the conversation about this story »         Investment Bankers Can Learn From Stand-Up Comedians June 29, 2011 at 1:22 PM   Yes, you heard that correctly. Let me explain. Originally from the Midwest and after a stint in the Navy, I decided to be an investment banking analyst in the late 90's. I did well in my business school applications, and after my MBA, I worked for a private equity-backed healthcare company, then more investment banking as an associate. But there was a problem. To say I was feeling unfulfilled is a severe understatement. My job became my life and I spent practically every waking hour working. As a result, I missed out on a lot of important things. I missed a few weddings and, most devastatingly, my mother passed from cancer during this period. I will never forget that her last words to me were over the phone while I was sitting at my desk scrambling to put something together for a client. After she died, I realized I had to find what it was I was put on this planet to do. I realized it was not banking pretty quickly. After a lot of searching, I decided to go into standup comedy. Since that decision three years ago, I've appeared on MSNBC.com, entered and placed in comedy competitions, and I perform at comedy clubs and colleges across the country. It turns out it was the right choice for me. I'm making a living (although not as much money as during my i-banking days, of course). Most importantly, I feel fulfilled. This transition from deals to the comedy world has happened before. Funnymen Paul Mecurio, Greg Giraldo and others made similar transitions. So far, my stand up journey has been painstaking yet refreshing. When I leave a club after a gig and think about the lessons I learned that night and the skills I'm sharpening as a standup comic, I can't help but think back to my i-banking days. I see a lot of connections between what I'm learning now and skills and traits that could have helped me then. I'm not suggesting that unfunny bankers try to start telling jokes in client meetings. Rather, I see three traits in successful comedians that i-bankers should seek to emulate: brutal honesty, vulnerability, and allowing different voices to be heard. Brutal honesty. How does this trait manifest in the comedy world? Look at headlining comics Jim Norton and Robert Kelly. Watching them perform, it's clear the crowd appreciates their honesty about themselves. After speaking with them recently at The Comedy Cellar in New York City, they both reinforced the importance of honesty in their material and how others in the world should consider ways to be more honest with both "the audience" and themselves. This certainly applies to the investment banking world. Far too often, I saw i-bankers sugarcoat uncomfortable truths with clients or themselves. Inevitably this leads to bigger issues down the road. Clients and colleagues, whether they're in comedy clubs or in cubicles are looking for honesty. Far too often, they don't get it. Vulnerability. This trait is related to brutal honesty, for sure, and you can't be vulnerable unless you're honest. I look to comedians like Bill Burr and Jessica Kirson to see how this trait can be deployed effectively in the comedy world. Bill Burr talks about the inner conflict of his relationships, brought on in part by his upbringing in Boston. Others might be shy about sharing awkward personal details, but you get the sense that he is opening up and bringing you into his real feelings. Jessica Kirson sometimes creatively shares with the audience a motivational conversation with herself on stage, opening up about her insecurities in an endearing way. How does this apply to investment banking? Younger employees daunted by a task can be inspired by those they work for if their superiors share their own struggles from early in their career. Too often in the machismo-laden i-banking world, people put on veneers of invincibility, when of course it's not true. But it sets the stage for an unattainable goal for the younger bankers, which leads to cutting corners and not being honest. The humanizing impact of showing vulnerability (which is different than weakness) can bring about a more cohesive, realistic, and empathetic workplace. Giving everyone a voice. The success of comedians George Lopez and Russell Peters represents this lesson. Their material gives the Latino and Pan-Indian markets a voice of pride. But their representation of these diverse voices actually shows the common humanity we all share. The leadership lesson here? Ensure all members have a voice on your team. Sometimes this can be difficult to do with the aggressive culture of investment banking. But allowing all voices to be heard can similarly show the common traits in seemingly divergent positions. This post originally appeared at Harvard Business Review. Please follow War Room on Twitter and Facebook. Join the conversation about this story » See Also: Why Jack Welch Fired Two Top Execs Even Though They Were Making GE Lots Of Money U of Chicago Researchers Reveal The Key To Finishing Everything You Start 7 Key Personality Traits Of Top Salespeople         Debt Ceiling Deal Emerges From Obama Press Conference June 29, 2011 at 1:18 PM   There's what he says and what he signals.  What President Obama signaled in his press conference this morning is that there is now a rough outline for a deal on deficit reduction and raising the debt ceiling. The facts are these: The Biden Group of negotiators has identified roughly $1.2 trillion in budget cuts that all parties to the negotiations have agreed to.  Details of those cuts have not been made available but everyone from Rep. Eric Cantor to Vice President Biden himself has said that they are a done deal. That leaves a roughly $1 trillion hole. Senators Tom Coburn (R-OK) and Joe Lieberman (I-CT) yesterday proposed fairly straightforward Medicare reforms that, they say, would lead to $600 billion in savings. President Obama said nothing about Coburn/Lieberman in his press conference.  Instead, he said: "I've been willing to say we need to see where we can reduce the cost of healthcare spending and medicare and medicaid, not by shifting the cost to the elderly." That does not rule out Coburn/Lieberman. The President was adamant that certain "tax expenditures" be eliminated, thus generating revenue. So, the deal appears to be a swap. President Obama will go forward with the Coburn/Lieberman Medicare reform if and only if the Republicans agree to his proposals on "tax expenditures." Please follow Politics on Twitter and Facebook. Join the conversation about this story » See Also: White House Likely To Take Debt Ceiling Negotiations To The Brink Boehner Says Government Default Date Is "Artificial" Politics In 60 Seconds: What You Need To Know Right Now         It's Ugly, But The First Facebook Phone Is Gonna Pack A Punch June 29, 2011 at 1:17 PM   AT&T just announced that it will carry the first Facebook phone ever, the HTC Status. It has a special Facebook button below its keyboard which gives users access to deep integration with Facebook Chat, photo uploads, check-ins, status updates, and more. You'll even be able to tap the Facebook button while you're listening to music to immediately post what you're listening to, and you'll be able to share a link to the website you're browsing with a touch of the Facebook button. When a friend calls, you'll see their status and Facebook picture right on your phone's screen. The phone's hardware is surprisingly impressive for a phone that looks this cheap. It has an 800 Mhz processor, 512MB of RAM, a front facing camera for video chat (as well as a 5 MP rear-facing camera), and Android 2.3 Gingerbread with HTC Sense UI layered on top. We're not convinced the 2.6-inch is big enough anymore, but the Facebook features alone will be worth checking out when the phone launches. No word yet on a release date or price, but we'll bet the Status launches for around $99.99 when the time comes. Don't Miss: The HTC Sensation Is The Best Android Phone We've Ever Used  Here's the full announcement from HTC: “HTC Status brings a Facebook experience to people who want to share their experiences with their friends faster and easier than ever before,” said Jason Mackenzie, President, HTC Americas. “With a dedicated Facebook share button combined with the hallmark HTC Sense experience, HTC Status makes it easy for people to stay connected to the things that are important to them.” Dedicated Facebook share button One touch to share- Press the Facebook share button from your home screen to instantly post on your wall. Snap, shoot, share- Take a picture or shoot a video and share it instantly with a press of the Facebook share button. You can even post pictures automatically as you’re taking them.. Quick-on-the-draw check-in- Just long press the Facebook share button to check in your location with Facebook Places. Be first with the news- See something cool on the web? Share your latest find with a quick press of the Facebook share button. Post to your wall – or a friend’s wall – From the home screen, a quick tap of the Facebook HTC share button makes sharing anything on your mind quick and easy. Share what you’re listening to- The Facebook share button glows when you’re listening to music, to let you know you can share. Let your friends in on the music you love with the push of a button.  Lock screen shortcuts Instead of a barrier, the HTC shortcut lock screen just became a launch pad to what you want to do now! Open your favorite apps by just dragging their shortcut icons into the lock screen ring. See what’s happening before you pick up Every time you get or make a call, you see your friend’s profile picture and latest status update right on the call screen. If it’s their birthday that week, you’ll see that, too. Special effects for photos and videos Anyone can be an artist. Use camera effects to make your photos and videos look like they’ve been taken through special lenses and filters—like Sepia for an old-fashioned look, or Aqua for a touch of cool. Apply effects right in the viewfinder, or apply them afterwards in the Gallery. Front and back cameras Take a spontaneous self-portrait or a quick cheek-to-cheek pic with your best pal on the VGA front-facing camera—or just double-check your hair with the Mirror app. With the 5.0 MP main camera with LED flash, you can capture every moment, with pictures or high-quality video. A smarter ringer The “Quiet ring on pickup” setting reduces the ring volume when you pick the phone up. The “Pocket mode” setting increases ring volume when your phone is in a pocket or bag, and then returns the volume to a reasonable level when you take it out. Tech Specs Platform: Android™ 2.3 + HTC Sense Display: 2.6-inch touch screen with 480 x 320 resolution Network: Quad-band GSM/GPRS/EDGE 850/900/1800/1900 UMTS/HSDPA 850/1900 Memory: 512 MB RAM, 512 MB ROM Processor: MSM7227, 800 MHz Battery: Rechargeable lithium-ion battery, 1250 mAh Camera resolution: 5 MP main camera with autofocus, VGA  front-facing camera Please follow SAI: Tools on Twitter and Facebook. Join the conversation about this story » See Also: Sony's PlayStation Phone STINKS At Gaming...And Pretty Much Everything Else [REVIEW] RUMOR: Samsung Is Making Google's New "Nexus Prime" Android Phone Apple Stores Are Now Unlocking New AT&T iPhones Media Files its-ugly-but-the-first-facebook-phone-is-gonna-pack-a-punch.jpg (JPEG Image)         Tahrir Square: The Smell Of Tear Gas In The Morning June 29, 2011 at 1:13 PM   The pictures and video coming from Tahrir Square last night and today seem eerily familiar. Egyptian demonstrators have squared off against the police in central Cairo for the past 18 or so hours. This is not totally unexpected. No one I know, Egyptian or other serious observers of post-Mubarak politics, believe that the political situation in Egypt will settle down anytime soon. There is just too much at stake and too many groups with equities in the future of Egypt for it to be any other way. That said, political contestation need not be violent and in fact, since the uprising, political violence has been relatively isolated. If the clashes are not totally unexpected (my friend Mahmoud Salem, known almost universally by his twitter handle “Sandmonkey” warned of potential instability and violence last week when I visited him in Zamalek), why they are happening still requires explanation. To my mind, there are four reasons why, once again, Tahrir Square is a zone of confrontation: 1. The proximate cause of the violence was an effort on the part of the police to disrupt peaceful protesters seeking justice for those who were killed during the 18 day uprising in January and February. It seems odd that the police and the Central Security Forces would be so heavy handed in dealing with the families of the shuhada, but it seems clear that the cops were looking for a fight. One eyewitness account indicates that as the police moved in, their commanders screamed over loudspeakers atop their trucks ‘We’ll @#$* you all…” The police and Central Security Forces were battered during the uprising, essentially beaten (badly) on the January 28 “Day of Rage.” That is not supposed to happen. For anyone who has ever seen police and CSF commanders in action, they are an arrogant, violent bunch. It seems clear that they are seeking revenge for the embarrassment of January. 2. Revolutionaries, activists, and ordinary Egyptians are deeply frustrated by the slow pace of justice. This is nothing new. The Egyptian judiciary has been gummed up for years. There is something more profound going on here beyond the usual frustration with the slow pace of virtually everything in Egypt. Bottom line: Although the former president, his sons, and their top advisors now languish in jail, Mubarak’s regime remains largely intact. This is why it is a misnomer to refer to the events of late January/early February as a “revolution.” In practice, this means that there are large numbers of people—from petty bureaucrats, police commanders, military officers to government ministers and judges (despite the judiciary’s overall reputation for independent thinking)—who do not support the change that so many Egyptians demanded during the uprising. As a result, they are doing what they can to thwart the goals and promise of Tahrir Square. 3. The Supreme Council of the Armed Forces and the Ministry of Interior apparently believe in the great silent majority who want nothing more than for things to “get back to normal.” This might be more accurate now than during the uprising, but the evidence so far suggests that average Egyptians were among the demonstrators in Tahrir last night and today. The security forces are taking a big risk when they use force against protesters. During this season of unrest, tear gas, water canon, and rubber bullets have not intimidated people, but rather galvanized them to take to the streets. 4. Finally, as I Tweeted last night, the clashes in Tahrir are a visible manifestation of the competing legitimacies of the Supreme Council of the Armed Forces and the instigators of the January 25 uprising. Needless to say, the officers still believe that the legitimacy of the state lies with armed forces and that military remains central to Egypt’s nationalist pantheon. For the revolutionaries, activists, and average Egyptians in Tahrir Square who view the military warily, legitimacy lies with the uprising that dumped Mubarak, further discredited a regime that the army represents, and articulated a clear set of changes to form the basis of a new, civil, and democratic political system. This post originally appeared at Council on Foreign Relations. Please follow Politics on Twitter and Facebook. Join the conversation about this story » Media Files egypt-violence.jpg (JPEG Image)         The Difference Between Marketing Emails & Notification Emails. Facebook & Twitter Demonstrate. June 29, 2011 at 1:05 PM   Groupon, Rue La La, Gilt Group, etc have built big businesses atop big email lists and great email marketing. Twitter has beefed up their email efforts by delivering notifications for retweets, mentions and favorites by your followers. It’s a powerful engagement lever unlike anything else (except perhaps for mobile notifications). And Facebook is masterful at sending targeted emails about core engagements / activities: mentions, photo tags (so important, viral and underrated), deals, etc. And here is a new, more generic email notification from Facebook: an alert that a friend likes a link. This is a less engaged action, for instance, than a mention, reply, or photo tag… but it begs to be clicked because: 1. it is a friend who took an action upon one of your actions, and 2. the email is intentionally broadly worded … not much is revealed – so you want to see more Whatever the size of your email list, you should think about email as a critical lever for driving engagement around relevant notifications. Of course, flooding users with emails will have negative consequences – but in general, if your users are active, they want to be alerted of activities related to actions they already took. That is a confusing statement – but it’s important! So let me repeat and dig in: - if your user explicitly took an action – such as post a link, favorite an article, etc - and something related to that action since occurred - users want to be alerted because it is tied to *their* actions / behaviors - this is very different, for instance, than getting product updates from the service… This is the different between marketing emails and activity emails… and users have a limited tolerance for marketing Read more posts on RyanSpoon.com » Please follow SAI on Twitter and Facebook. Join the conversation about this story »         S&P Will Slash America From AAA To D If The Treasury Misses A Payment June 29, 2011 at 1:04 PM   Say it to yourself: A default is a default is a default. There's no such thing as a "technical default" whereby the US can miss a debt payment, but somehow not have the status of a country that defaulted, with no ramifications. If the US does miss a coupon payment, the AAA rating is toast. That's what S&P will do, according to Reuters, in such an extreme event. The ratings agency's managing director John Chambers made that clear in an interview with Reuters. This should silence the folks who are citing Stan Druckenmiller (and others) who think a default wouldn't be that big of deal. Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: Debt Ceiling Decision Tree: How To Figure Out If Washington Is Going Blow It SocGen's Commentary On Obama's Press Conference: No Progress Has Been Made On The Debt Ceiling Media Files d.jpg (JPEG Image)         Is CNN Getting Ready To Give Eliot Spitzer The Boot? June 29, 2011 at 1:02 PM   Normally it's the New York Post that's pushing gloomy gossip regarding CNN, but a small item in yesterday's Daily News Gatecrasher column is speculating that Eliot Spitzer may not be long for the network. One insider tells us that with buzz growing about a pending cancellation, staffers "are happy, not because they don't like Spitzer, but because the show's performance is not helping the network." When we asked a CNN spokeswoman for comment, she replied that "speculating on CNN's lineup has become a pastime of many, so we will decline to comment." Spitzer's ratings were rock bottom last week while he was out on vacation, however, they appear to have returned to normal (solid, if not spectacular) levels this week.  Meanwhile, that Spitzer may get shuffled out of the line-up is not exactly new gossip. Every few months speculation that either he or John King are getting the boot bubbles up -- more so since Erin Burnett was hired away from CNBC.  In the case of John King, CNN was quick to tamp down the rumor he was being replaced saying: "John King, USA is performing very well and we are extremely proud of the work he and his team do each and every day.  We have no plans to make changes to John King, USA." Please follow The Wire on Twitter and Facebook. Join the conversation about this story » See Also: Bernie Goldberg: I Want Conservatives To Call Anybody Who Criticizes Herman Cain A Racist MADDOW: What Republicans Are Doing With The Debt Ceiling Is "Disgusting Hypocrisy" Jon Stewart: Fox Has Created A System Where Any Criticism Is Proof Of Liberal Bias         Splitscreen: A Love Story Shot Entirely on the Nokia N8 Mobile Phone June 29, 2011 at 1:00 PM   Splitscreen: A Love Story is an elegant short shot entirely on the Nokia N8 mobile phone, created by director JW Griffiths and director of photography Christopher Moon. The cleverly constructed splitscreen film was selected as the official winner of Vimeo's Nokia Shorts 2011 contest, raking in a grand prize of $10K. So how did they do it? Splitscreen: A Love Story was shot using the Steadicam Smoothee, a hand-held dolly designed for the iPhone 3GS, which the team adapted for use with the Nokia N8. They then attached the device to a bicycle, creating one large mobile dolly to capture the short's beautiful, longshot cityscapes. In the gallery below, check out the project's brief behind-the-scenes "making of", as well as the original pitch for the short. Overall, the quality of the footage is quite impressive. What do you think? How long until a major theatrical release is shot entirely on a smartphone? Via Splitscreen: A Love Story Shot Entirely on the Nokia N8 Mobile Phone on WonderHowTo. Read more posts on WonderHowTo » Please follow SAI: Tools on Twitter and Facebook. Join the conversation about this story »         Dodgers Owner Frank McCourt's Five Most Ridiculous Debts June 29, 2011 at 12:56 PM   The sad, strange story of Frank McCourt's tenure as owner of the Dodgers took another turn yesterday, as the team filed for Chapter 11 bankruptcy. Naturally, the question on the minds of Angelenos, as well as sports fans everywhere, is how? How does one of the most storied franchises in professional sports end up at the mercy of a bankruptcy judge, begging for handouts from investors and hanging in the balance of a divorce settlement between an awful, spoiled man and his awful, spoiled wife? How could the Dodgers be losing money? Well, owing Manny Ramirez $21 million probably doesn't help. That's right, as part of the bankruptcy filing yesterday, McCourt listed one Manuel Aristedes Ramirez as the team's largest creditor, with $21 million in deferred salary due by the end of the week. In Frank's defense, anytime you can give a $45 million contract to a guy who spends most of his time injured or being suspended for using steroids, you've got to jump at that. At least that's a baseball expense. But the reason Frank is in such hot water isn't simply because he over payed a large Dominican man to hit a ball with a stick. It's because he and his loving wife Jamie used the Dodgers—to quote one of their family advisers—"like their personal credit card," leveraging team assets to support a lifestyle that makes Kim Kardashian's wedding registry look almost reasonable. So here's a look at the five most absurd expenses—both personal and professional—that have brought the McCourts and the Dodgers to the brink. This post originally appeared at Guest of a Guest. The Swimming House: $21,250,000 Jamie McCourt likes to swim. That's cool, right? I mean, swimming is fantastic exercise, it's relaxing, it's clearly good for your skin, so what's not to like? I'm guessing that was the logic when Jamie plunked down an additional $14 million (that's in addition to the $21.25m purchase price listed above) to turn the outdoor tennis court of the Holmby Hills mansion in the picture into an Olympic-sized indoor swimming pool with its own pool house, sauna, steam room, and massage room. And while this would hardly be the only $30 million mansion in Holmby Hills, it might be the only one that's only used for the pool. That's right. Post—separation, this 15,000 square-foot palace is being maintained by Jamie "exclusively for swimming," according to Frank's attorneys, while she lives in a separate beachfront Malibu mansion that used to belong to Courtney Cox and David Arquette (love must have been in the air!). Of course, only having one olympic-sized swimming pool is like only having one pair of underwear, so Jamie's been filing plans with the Malibu city office to expand the pool at that location and put in a snazzy wood deck and private cabanas. Of course, none of this is cheap, which would explain why one of the centerpieces of the divorce proceedings is almost $750,000 a month in mortgage payments on their private homes. The Russian Mystic: "Six Figures" But hey, real estate is an investment, right? Kind of like paying a 71-year old Russian man to think positive thoughts about your baseball team? Oh wait, I'm not sure what that qualifies as. Abject lunacy? Maybe we should ask Frank, who as we reported earlier employed an elderly Russian "scientist/healer" named Vladimir Shpunt to watch the Dodger games at home (in Russia, natch) and channel his positive "V energy" to the team. Now, to be fair, much of the reported six figure payout was in the form of a bonus, dependent on the team's regular season performance and how well they did in the playoffs. Unfortunately, it seems to have been based on winning the National League West, as opposed to oh, say, the World Series. Perhaps having realized how utterly ridiculous this all sounds, Frank's been keeping much more quiet about the voodoo priestess I heard he hired to make sure Jamie has an "accident" during her lap swimming. Is this why he tried to subpoena a lock of her hair? Marquis Grissom: $2.7 Million Say what you will about Manny Ramirez, but at least he swung a bat for the Dodgers in the last 10 years. Part of Frank's ever-deepening financial hole was the way he creatively structured his assets, separating every facet of the team's expenses in order to maximize the amount of money he could borrow against and delay repayment as long as possible. All of which is by way of explaining how the Dodgers could still owe money to Marquis Grissom, who is 44 years old, retired five years ago, and last wore Dodger blue when I was still in high school. Though there's no denying that Marquis was a hell of a player, there's also really no good reason why he should still be owed money on a Major League payroll. I'll put it like this: when Marquis made his first All Star team in 1993, he was on the same roster as Tony Gwynn, Sr. Come Thursday, one of the current Dodgers that Frank McCourt will owe money to (albeit an affordable $675k): Tony Gwynn, Jr. See the rest of the story at Business Insider Please follow The Life on Twitter and Facebook. See Also: PHOTOS: We Try Frida Kahlo's Favorite Beer HOUSE OF THE DAY: Hollywood's Favorite Jeweler Is Selling His Mediterranean Estate For $11 Million Screw The Hamptons And Take Your Shirt Off At This Bikini Brunch In Midtown         What You Should Know About The Greek Lawmaker Who Just Got Attacked On The Street June 29, 2011 at 12:53 PM   The chaos in Greece continues. Particularly disturbing is that PASOK PM Alexandros Athanasiadis got attacked on the street. Athanasiadis voted FOR the controversial austerity bill after initially saying he would oppose it. The last-minute switch was something of a surprise. And the reason this was such a surprise vote for him, is that one of the big privatizations in the plan -- the privatization of the Public Power Corporation -- hits his district disproportionately. Obviously a brutal vote for him to take. Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: OLLI REHN: There Is No Plan B For Greece, Pass The Vote Or Face "Immediate Default" THIS IS HAPPENING AGAIN: Greek Police Using Teargas On Protesters And Riots Are Breaking Out Standard Chartered Has Cut Back Its Lending To European Banks Over Greece Fears         NFL Fights Sports Fans to Keep Blackout Rule June 29, 2011 at 12:51 PM   For Immediate Release: Contact: Ben Fishel Wednesday, June 29, 2011 (301) 908-4244 ben@sportsfans.org NFL Fights Sports Fans to Keep Blackout Rule League Asks FCC to Ignore Fans' Calls for End of Blackouts In comments filed with the Federal Communications Commission on Monday, the National Football League responded to comments previously filed by Sports Fans Coalition regarding sports blackouts. In May, Sports Fans Coalition asked the FCC to reexamine its own rules on blackouts and retransmission "take-downs" that occur when broadcasters and TV providers are in a dispute. "The NFL is clearly scared that we are finally shining a bright light on the dirty business of sports blackouts," Sports Fans Coalition Executive Director Brian Frederick said today. "We asked the FCC to prevent sports programming from being used as a weapon in retransmission fights and to examine whether sports blackouts are even necessary. Only the NFL chose to speak up and absurdly claim that sports blackouts are actually necessary for fans." In its May comments filed with the FCC, Sports Fans Coalition argued that Congress never mandated the FCC to rule on sports blackouts and take-downs and that the best situation for fans would be the elimination of blackouts and take-downs. "Fans are looking for a referee that puts them back in the game," Frederick said. "It is time for the FCC to simply review its own rules on blackouts and take-downs, especially given the many new forms of media now available to fans." In its comments with the FCC on Monday, the NFL claimed it "uses its negotiating authority in the public interest." The NFL's comments come during the midst of a lockout of its players. In February, United States District Court Judge David S. Doty wrote that the "record shows that the N.F.L. undertook contract renegotiations to advance its own interests and harm the interests of the players." "While the NFL locks out its own players and fans in the interests of profits, it is asking that it be allowed to continue to receive government subsidies and anti-trust exemptions," Frederick said. "Enough is enough. Their views are out-of-bounds with the best interests of fans and the law." Sports Fans Coalition is a nonprofit established in 2009 that is fighting to give fans a voice on issues like media blackouts, high ticket prices, stadium construction and college football playoffs. In January, they launched Save Next Season, a campaign featuring a petition signed by thousands of fans calling on the NFL and NFLPA to guarantee there will be a 2011 season. CONTACT: Ben Fishel (301) 908-4424, ben@sportsfans.org Read more posts on SportsFans.org » Please follow Sports Page on Twitter and Facebook. Join the conversation about this story »         Pippa Middleton Is At Wimbledon Right Now June 29, 2011 at 12:50 PM   Days after Kate Middleton and Prince William were spotted taking in the action at Wimbledon, Middleton's sister, Pippa Middleton, has made an appearance. The younger Middleton has her on-again, off-again boyfriend Alex Loudon in tow -- which should help silence rumors of her single status and links to Prince Harry. Loudon has appeared pretty chatty each time the cameras cut to the couple -- but Pippa is only mildly impressed by whatever he's telling her. (Note the very slight smile she indulges him with in the second photo. We can only assume she's trying to concentrate on the match, and he's kind of annoying her.) Keep it up, Loudon. We'd love to write again soon that she's back on the market.   Please follow The Wire on Twitter and Facebook. Join the conversation about this story » See Also: STAR MAP: See Where Media's Biggest Names Summer In The Hamptons John Malkovich Is Starting A Clothing Line Inside The Summer-Movie Rumor Mill That's Worth Millions Of Dollars Media Files pipp.png (PNG Image)         Here Is What President Obama Just Said June 29, 2011 at 12:49 PM   President Barack Obama held his first solo press conference since March today.  Obama went on the offensive, criticizing Congress for using "scare tactics" during the ongoing debate over raising the debt ceiling. He also defending U.S. military involvement in Libya and his strategy for pulling troops out of Afghanistan. Obama praised New York State's passage of a same-sex marriage bill, but deflected questions about his personal views on the issue. Our live blog from the press conference is below. 12:48: Brian Williams asks if Obama is channeling his inner Truman?  (Truman nicknamed the 80th Congress the "Do Nothing Congress" if you missed the reference) 12:47: And he's done. 12:46: Obama: "If the leadership here in Washington keeps them in mind... then we will solve this debt limit issue, put in steps like a payroll tax cuts and infrastructure development... These are solvable problems. They require putting aside the selfish approach that sometimes politics brings." 12:45: Obama: "These folks are counting on us. They desperately want to believe their leadership is thinking of them and is not playing games." 12:44: Obama: "We know what to do. We know that if we are educating our kids well we will be more competitive. We know if we invest in infrastructure it will pay off."  12:42: President ending on an emotional note. References the letters he gets "everyday" from Americans having financial difficulties. 12:39: Obama criticizes the congressional schedule and says they need to get the job done: "They're in one week they're out one week. You need to be here, I'm here. You stay here. Let's get it done." 12:37: Obama says his daughters do their homework early, not the night before. Advises Congress not to pull an all-nighter. 12:36: Obama makes a concerted attempt to position himself outside of politics: "I'm the President of the United States, I try not to engage in scare tactics...I don't want people to get spooked." 12:35: Obama: "[Congress] took the vacation, they bought the car, and now they are saying maybe we aren't going to pay, or maybe we are not going to pay as fast as we said we would." 12:34: Obama on Republican proposal to only pay interest on the debt to avoid default: "Are we really going to start paying interest to Chinese and not pay people their Social Security checks?" 12:33: Obama on debt limit brinkmanship: We don't know how capital markets will react — but if capital markets decide, the U.S. doesn't pay its bill and starts pulling their money out and the Treasury has to raise interest rates, that means higher interest rates for businesses and higher interest rates for consumers. 12:32: Obama on the possibility of default: "This is a jobs issue, this is not an abstraction." 12:31: Obama lays down the law on the debt ceiling: "By August 2 we run out of tools to make sure all our debts are paid - it is a hard deadline"  12:30: Obama congratulates CNN's Jessica Yellin on becoming the network's new White House correspondent. She asks if the Treasury Department's August 2 deadline is the real default date. 12:29: Obama calls once again on Congress to pass the "DREAM Act." 12:27: Asked about Operation Fast and Furious, the controversial ATF gun-running investigation, Obama says the investigation is "still pending." "I've made clear my views: That is not an appropriate action by the ATF and we need to find out how that happened." 12:25: Obama on Qaddafi potentially using rape as a weapon of war — Obama seems determined that Libya will not be his Rwanda/Srebrenica. 12:23: Obama says "I won't make news on that today," when asked about his personal views on same-sex marriage. "Nice try" he added. 12:22: Obama on Qaddafi: "He needs to step down. He needs to go." 12:21: Obama says he "knows something you don't" about Libya, says International Criminal Court has collected evidence that Qaddafi troops are "using rape as an instrument of war." 12:20: Obama: When you have former presidential candidates John McCain (R-AZ) and John Kerry (D-MA) coming together on Libya, that should tell the American people something about the legitimacy of the mission there. 12:18: Another Libya question. ABC's Jim Sciutto as how long Americans will put up with continued U.S. involvement. "Is there any definition of success other than Qaddafi being removed from power." "Kabul is much safer than it was," a day after deadly terrorist attack and standoff at one of the most secure hotels in the city. 12:15: Addressing the question, Obama says "I didn't use 'victory' in my West Point speech. I said we would be successful." 12:14: Obama highlighting progress in Afghanistan, and the way forward. He says it is "not in America's interest" to have Taliban take over the country again. 12:12: Obama's comments on the NLRB suit appear to be a veiled criticism of the Washington labor union whose strike tactics drove Boeing to South Carolina. It seems to us that Obama is sending a warning to labor to stop getting in the way of job creation and American manufacturing.   12:11: Obama says "there are times where military commissions will be appropriate" to try suspected terrorists. A major policy shift from the beginning of his administration. 12:10: First national security question from Obama on Guantanamo / terrorist prosecutions. 12:09: Obama: "What defies common sense is the notion that we would be shutting down a plant because workers and management can't come to an agreement." "We can't have labor and management fighting all the time" — wants to make sure U.S. keeps its advantage in airline industry 12:09: Obama on Boeing/NLRB case: "Companies need the freedom to relocate, and they also need to follow the law." 12:08: Obama addresses the Boeing/NLRB case. He says the NLRB is an independent agency and that the outcome is "up to a judge to decide." 12:06: Obama says "I think we can walk and chew gum at the same time. We can focus on jobs at the same time we are focused on debt and deficit reduction." 12:04: First a deficit and debt reduction answer: "Deficit reduction, debt reduction should be part of an overall package for job growth in the long-term - it's not the only part but it's the only part." 12:03: Obama gets a question on the Boeing/NLRB lawsuit.  12:02: The use of "civil marriages" is sure to turn eyebrows. 12:02: Obama on gay marriage: "Ultimately, [New York] made a decision to recognize "civil marriages" — each state is going to need to work through these issues." 12:00: Obama says same-sex couples should have equal rights, and highlights his administration's work ending Don't Ask, Don't Tell and not defending the Defense of Marriage Act. He hasn't addressed the question of whether or not he supports gay marriage. 11:58: Obama chides Republicans for making Libya their "cause celebre": "We should be sending a unified message to [Qaddafi] to tell him to get out." 11:57: Obama says the War Powers Act was meant to prevent another Vietnam — which Libya is not, he says — sidestepping the constitutional question.  11:56: On Libya, Obama says U.S. the operation "is limited in time and scope" and that throughout, his administration has consulted with Congress. Many Democrats and Republicans would beg to disagree. "We have consulted with Congress — we've had 10 hearings on it, we've sent reams of information, I've had members of Congress over to talk about it so a lot of this fuss is politics." 11:54: NBC's Chuck Todd asks Obama a convoluted question about whether he believes the War Powers Act and Debt Limit are constitutional. He also asked about gay marriage somewhere in there. Obama calls it a "hodgepodge question" drawing a few laughs. 11:53: "My expectation is that [Republicans] will do the responsible things." 11:53: Obama: "If we do not have revenues, that means that there are a bunch of kids out there that aren't getting college scholarships." Other things that might be compromised: the national weather service, food inspection, medical research "We are going to keep on having these conversations, my belief is that — hopefully sooner rather than later — the Republican leadership in Congress will come to the conclusion that they need to get off their maximalist position." 11:50: Obama says he, and many "out-of-office Republicans" believe that raising taxes is the only way to reduce the deficit sufficiently. "You can't reduce the deficit to levels that need to be reduced without revenue in the mix," he said. 11:49: Obama says "we are going to have to look at entitlements" to "see where we can reduce the costs of Medicare and Medicaid." He takes aim at the Coburn-Lieberman plan announced yesterday: "I've been willing to say we need to see where we can reduce the cost of healthcare spending and medicare and medicaid, not by shifting the cost to the elderly." 11:48: "My expectation is that leaders are going to lead," Obama says of congressional Republicans on tax increases. 11:47: AP's Ben Feller asks Obama if he insists a debt ceiling deal includes tax increases — something GOP leaders say they will not pass. 11:47: Obama opens it up for questions. As always, The Associated Press gets the first one. 11:46: Obama says he thinks both parties can agree on a debt ceiling and deficit deal. 11:45: Obama: "I spent the last two years cutting taxes for ordinary Americans….The tax cuts I am suggesting are for millionaires and billionaires, for oil companies and hedge fund managers and corporate jet owners." 11:43: "Yes, we have to tackle spending in our tax code," Obama says, calling once again for cutting subsidies for oil and gas companies. 11:42: Obama says we have to examine defense spending and "tackle entitlements" to close the deficit  11:41: Obama is criticizing Congress for not acting on several bills that "can create jobs right now." 11:39: Obama starts off with a prepared statement on the economy. 11:39: And here is the President.  11:33: Obama is running at least a few minutes late. The news conference was scheduled to start at 11:30.  11:29: We're expecting Obama to take the podium any minute now. In the meantime, Speaker of the House John Boehner's office has released a list of seven questions for the President, including one on the Boeing/NLRB lawsuit. The full list is here 11:15: Here are some questions Obama might be asked during this morning's press conference:  How firm is Treasury Secretary Tim Geithner's August 2 deadline to raise the debt ceiling? [House Speaker John Boehner told Fox News yesterday that the deadline is "artificial"] Is the debt ceiling unconstitutional? Some Democratic lawmakers are trying to make this claim. What are the consequences if no agreement is reached on the debt limit increase? Could Social Security payments be delayed? He will also likely take questions on the Senate's Libya resolution and the withdrawal of troops from Afghanistan. Please follow Politics on Twitter and Facebook. Join the conversation about this story » See Also: Obama To Face The Press Tomorrow Amid Rising Tensions With Congress Politics In 60 Seconds: What You Need To Know Right Now Democratic Lawmakers May Proclaim Debt Ceiling Unconstitutional As A Last Ditch Effort To Avert Default         Oil Daily Outlook 29 June June 29, 2011 at 12:48 PM   Oil prices bounced back and rose by over 2% after they had remained nearly unchanged a day earlier. Today Greece will decide on the budget cuts, but the news doesn’t seem to stir up the market for now. Related news that could affect oil prices today include the US petroleum stocks report by the EIA, and the US pending home sales. Here's a short analysis and outlook of the oil market for today, June 29th:  Oil prices – June 2011  On Tuesday, June 28th oil price (WTI) bounced back and inclined by 2.52% to $92.89/b; during June (UTD) WTI shed nearly 9.55% of its value.    Brent price also inclined by 2.17% to $108.69/b; during June Brent declined by 7.25%. Premium of Brent over WTI  The premium of Brent over WTI remained nearly unchanged and reached on Tuesday June 28th $15.8/b; this gap rose by 9.12% during June.  Following the spike in the premium of Brent over WTI on June 13th in which it reached $23.29/b, this premium fell to similar levels it was back in the beginning of June.  Petroleum stocks in the US  The US Energy Information Administration will publish today its weekly report on U.S. oil stocks: according to Bloomberg the oil stocks fell by 2.7 million barrels during last week. In the previous report, Petroleum stocks rose during previous week by 3.084 million barrels, or by 0.17%. For the week ending on June 17th oil stocks reached 1,791 million barrels (See here the previous petroleum report).  US pending home sales  Today, the US home sales report will be published and will present the major changes in pending home sales during May 2011; in the recent report regarding April there was a decline in number of homes sold despite the rise during the March and February; this report is likely to show an ongoing decline in sales as the US economy is slowing down. If this will be the case, it might adversely affect oil prices: according to a research done by Roache et. al (2008) a working paper on the effects of news on commodities including  oil, it was shown that a decline in the Existing home sales  caused a significant adverse effect on  oil the following day (a lag effect). If this will be the case, we might see a moderate downward effect on oil.       The Greek Debt and oil  Today the Greek parliament will vote on the major budget cuts proposed by Greece's Prime Minister George Papandreou. There is heavy opposition against these budget cuts, but Failure to pass these budget cuts could result in the European Union not approving the recent bailout funds Greece needs to avoid default of its loans. Since the Euros to US dollar is strongly correlated with  oil, the changes that this exchange rate will endure due to the news related to the Greek debt could possible also affect  oil. Currently, the news from Greece doesn't seem to affect Euro/USD.  Oil price outlook:  The Greek debt will continue to affect Euros/USD and consequently might also affect  oil; the news over IEA releasing 60 million bbl of  oil might have brought down  oil last week, but currently this affect is terminal as  oil prices already started to bounce back; furthermore  oil might soon start to pick up again as we are entering the summer in which the seasonal effect  will bring demand for oil up and hike  oil price again.  Here is a reminder of the top events and reports that are planed for today  (all times GMT):  Today 13.00 – Canadian Core CPI 15:00 – U.S. pending home sales 15:30 – EIA report about  oil inventories For further reading: Oil prices Monthly outlook –June 2011   Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         Awl publisher David Cho is leaving the site he launched with Alex Balk and Choire Sicha to work for Bill Simmons' ne... June 29, 2011 at 12:48 PM   Awl publisher David Cho is leaving the site he launched with Alex Balk and Choire Sicha to work for Bill Simmons' new site Grantland -- "“The opportunity at Grantland and to work with Bill and to work with some of the people at ESPN is the only job that ever could have made me even consider leaving." Please follow The Wire on Twitter and Facebook. Join the conversation about this story »         The Latest On The Wisconsin Chokehold June 29, 2011 at 12:44 PM   At National Review, Christian Schneider has what seems to be the most comprehensive account so far of the incident in which liberal Wisconsin Supreme Court Justice Ann Bradley was allegedly choked by conservative Justice David Prosser, who was just returned to his seat in a bitterly contested election. National Review is naturally going to be predisposed towards Prosser's side. Keeping that in mind, if the facts as reported are correct, three things are pretty clear: 1. Bradley started it by shaking her fist at Bradley and pushing herself nose-to-nose, conditions under which many people might have tried to push her away by putting their hands on her shoulders. 2. Prosser did not put any pressure on her neck, something Bradley herself seems to have admitted, though she says that this is only because another justice pulled her away. 3. Either the original story relied on people who had no first-hand knowledge of the incident, or the source of the story is Bradley herself, and (also liberal) Chief Justice Abrahamson; the conservative justices seem to be backing Prosser: "There were six justices present at the time of the incident, four of whom would be more likely to back Prosser's version of the story. That leaves Abrahamson and Bradley as the only two remaining justices present. One source present speculated the third source may have been Bradley's law clerk, who likely didn't actually see the confrontation but may have head Bradley shout 'I was choked.'" Liberals are probably going to be disposed to believe that Abrahamson and Bradley are pursuing a legitimate grievance against Prosser, a self-admitted hothead who called Abrahamson a "bitch" and threatened to destroy her, and that the conservative justices are covering up for their abusive colleague. Conservatives will be likely to take the view that Bradley is a vengeful self-dramatist who inflates petty conflicts into savage attacks for political purposes.   I personally am heavily influenced by the fact that Bradley apparently declined to press charges against Prosser, and instead chose to prosecute her grievance by leaking to a reporter—a leak that airbrushed out pertinent details like the fact that she was standing nose-to-nose with him and shaking her fist when he allegedly started choking her.   This does not seem to me like the behavior of someone who is confident that the facts will bear her out; it seems, well, like the behavior of a vengeful self-dramatist who inflates petty conflicts into savage attacks for political purposes. It's not as if the sheriff is likely to whitewash things for Prosser; he supported Prosser's opponent in the last election. I'm also not thrilled that the outlet that originally reported the story somehow failed to check with the three other conservative judges who, reading between the lines, are pretty clearly backing Prosser's account. It's not like it seems to have been very hard to get them to talk; the Journal Sentinel had the story of "Bradley's Charge" less than 24 hours later, and they now seem to be leaking far and wide.   So why couldn't this outlet get any of them on the horn? But it is early days yet; law enforcement is investigating, and there are probably many pertinent facts not contained in Schneider's story.  Frankly, whatever way you look at it, someone has behaved in behavior so extraordinarily unbecoming a justice that I find it difficult to believe either way.  Having known quite a few people who liked to exaggerate the things that were done to them, I find this marginally more plausible than that a Supreme Court justice started choking his colleague in front of four witnesses—but only marginally. Whatever you believe, it's clear that the court dynamic has become unbelievably toxic. And  I fear that this sort of thing is becoming more and more common in today's partisan environment. This post originally appeared at The Atlantic. Please follow Politics on Twitter and Facebook. Join the conversation about this story » See Also: The Latest On The Wisconsin Chokehold         The Latest On The Wisconsin Chokehold June 29, 2011 at 12:43 PM   At National Review, Christian Schneider has what seems to be the most comprehensive account so far of the incident in which liberal Wisconsin Supreme Court Justice Ann Bradley was allegedly choked by conservative Justice David Prosser, who was just returned to his seat in a bitterly contested election. National Review is naturally going to be predisposed towards Prosser's side. Keeping that in mind, if the facts as reported are correct, three things are pretty clear: 1. Bradley started it by shaking her fist at Bradley and pushing herself nose-to-nose, conditions under which many people might have tried to push her away by putting their hands on her shoulders. 2. Prosser did not put any pressure on her neck, something Bradley herself seems to have admitted, though she says that this is only because another justice pulled her away. 3. Either the original story relied on people who had no first-hand knowledge of the incident, or the source of the story is Bradley herself, and (also liberal) Chief Justice Abrahamson; the conservative justices seem to be backing Prosser: "There were six justices present at the time of the incident, four of whom would be more likely to back Prosser's version of the story. That leaves Abrahamson and Bradley as the only two remaining justices present. One source present speculated the third source may have been Bradley's law clerk, who likely didn't actually see the confrontation but may have head Bradley shout 'I was choked.'" Liberals are probably going to be disposed to believe that Abrahamson and Bradley are pursuing a legitimate grievance against Prosser, a self-admitted hothead who called Abrahamson a "bitch" and threatened to destroy her, and that the conservative justices are covering up for their abusive colleague. Conservatives will be likely to take the view that Bradley is a vengeful self-dramatist who inflates petty conflicts into savage attacks for political purposes.   I personally am heavily influenced by the fact that Bradley apparently declined to press charges against Prosser, and instead chose to prosecute her grievance by leaking to a reporter—a leak that airbrushed out pertinent details like the fact that she was standing nose-to-nose with him and shaking her fist when he allegedly started choking her.   This does not seem to me like the behavior of someone who is confident that the facts will bear her out; it seems, well, like the behavior of a vengeful self-dramatist who inflates petty conflicts into savage attacks for political purposes. It's not as if the sheriff is likely to whitewash things for Prosser; he supported Prosser's opponent in the last election. I'm also not thrilled that the outlet that originally reported the story somehow failed to check with the three other conservative judges who, reading between the lines, are pretty clearly backing Prosser's account. It's not like it seems to have been very hard to get them to talk; the Journal Sentinel had the story of "Bradley's Charge" less than 24 hours later, and they now seem to be leaking far and wide.   So why couldn't this outlet get any of them on the horn? But it is early days yet; law enforcement is investigating, and there are probably many pertinent facts not contained in Schneider's story.  Frankly, whatever way you look at it, someone has behaved in behavior so extraordinarily unbecoming a justice that I find it difficult to believe either way.  Having known quite a few people who liked to exaggerate the things that were done to them, I find this marginally more plausible than that a Supreme Court justice started choking his colleague in front of four witnesses—but only marginally. Whatever you believe, it's clear that the court dynamic has become unbelievably toxic. And  I fear that this sort of thing is becoming more and more common in today's partisan environment. This post originally appeared at The Atlantic. Please follow Politics on Twitter and Facebook. Join the conversation about this story » See Also: The Latest On The Wisconsin Chokehold         Unbelievable New Pictures Of Human Chameleon Liu Bolin Hiding In New York June 29, 2011 at 12:32 PM   There's a 37-year-old artist in China who can paint himself into anything. Liu Bolin has been disguising himself to blend in urban or nature backdrops, creating the illusion of a human chameleon or a ghost. He spends about 10 hours being painted for each work so he perfectly matches the background. Bolin is currently in New York City for a new installment of his project 'Hiding in the City,' which previously included Beijing and Venice. You can see a solo exhibition of Bolin's work at the Eli Klein Fine Art Gallery in New York Jun 29 – Aug. 28, 2011. Or you can flip through a sneak preview of Bolin's camouflage photos in New York and images from his previous protects. All photos are courtesy of Eli Klein Fine Art. First, here are a few of his famous photos: Photos courtesy of Eli Klein Fine Art He paints himself all over to blend into the background of city scenery. Photos courtesy of Eli Klein Fine Art And the result is amazing. Check out some unbelievable images from his project 'Hiding in the City' in Beijing: Photos courtesy of Eli Klein Fine Art See the rest of the story at Business Insider Please follow Business Insider on Twitter and Facebook. See Also: Check Out Revolutionary Artwork From Ai Weiwei, The Guy China Has Under House Arrest NYC Is Already Promoting Itself As A Gay Marriage Destination A Quick Guide To The The New Chinese Military Triple Threat Media Files liu-bolin-new-york-june-2011.jpg (JPEG Image)         Here's One Reason Facebook Should Be Nervous About Google+ (GOOG) June 29, 2011 at 12:32 PM   Google's new social network, Google+, has a lot of early problems: it looks and feels a lot like Facebook, but doesn't offer anything obviously compelling enough to get users to switch. Plus, there's nobody on the service yet. But there's one aspect that should have Facebook a little bit nervous. Once you've signed in, every Google site you use gets a toolbar across the top with some new icons related to the service. Among those icons is a little notifications window. Whenever somebody adds you to their Circle ("friends" you, in Facebook terms) or comments on something you've said or shared, the notification window turns red. You can't help but notice it -- just like the badges on iPhone apps that get you to check for new messages. Gmail has more than 200 million users, and every single one of them has to be signed in to use it. Google.com gets more than 1 billion visitors per month, and some of them are going to be signed in as well. As those users sign up for Google+, they're going to be continually reminded to check the site. That's one way to build an audience fast. Don't miss: Our Complete Tour Of Google's Answer To Facebook. Please follow SAI on Twitter and Facebook. Join the conversation about this story » See Also: Facebook Knew About Google Circles Last Year, And Beat It To Market With Groups Wow, Google+ Looks EXACTLY Like Facebook Google Plus Looks Like Everything Else         This Horse Might Ruin The Holidays For Steven Spielberg This Year (VIDEO) June 29, 2011 at 12:27 PM   Steven Spielberg is having a great summer. "Super 8" is doing steady business at the box office, and the latest installment of the "Transformers" franchise (which he executive produces) bows today. But if you check in with him around holiday time, Spielberg might not be feeling so jubilant. His next major project, "War Horse" (adapted from the book and Broadway sensation) opens Christmas Day. And while the film will benefit from the stage-related buzz, it has something working against it: Spielberg's overtly historical dramas are wildly inconsistent when it comes to box office returns. Witness: "Schindler's List," his first history-buff extravaganza, more than tripled its budget with a $96 million box office pull. "Saving Private Ryan" did even better with $216 million. But "Amistad" only made $44 million, barely breaking even -- and "Munich" (with a total of $47 million) failed to do so. So which category will "War Horse" -- which is set during World War I, by the way -- fall into? Your first clue is the early trailer below -- and we feel like something's missing. Thoughts? Please follow The Wire on Twitter and Facebook. Join the conversation about this story » See Also: Meet The Team Behind The Film Poised To Clean Up At The Oscars -- In 2013 Inside The Summer-Movie Rumor Mill That's Worth Millions Of Dollars Inside The $250 Million "Dark Knight" Sequel's Insane Wayne Manor Mansion         Bad News, Your "Diet" Soda Is Making You Fat, Too June 29, 2011 at 12:26 PM   Opting for diet soda instead of regular, won't help fight the bulge. Data from a recent study by the American Diabetes Association shows that while diet sodas may be free of calories, they do not prevent you from gaining weight (via CBS). In fact, they may contribute to weight gain. Diet soda also contributes to diabetes, heart disease, cancer, and other chronic conditions. The ADA analyzed measures of height, weight, and waist circumference compared to diet soda consumption over a period of nine and a half years and found that the adults who drank more diet soda per day gained more weight and added inches to their waistlines. Those who drank two or more diet sodas a day added four more inches to their waistlines over time: So if there aren't calories, what is causing the weight gain? In another study, the ADA, fed one group of mice a normal diet, and another group the same diet with the addition of aspartame, an artificial sweetener used in most diet drinks. At the end of three months, the mice on the aspartame diet had much higher blood glucose levels. A co-author of both studies told the Daily Mail: "Artificial sweeteners could have the effect of triggering appetite but unlike regular sugars they don't deliver something that will squelch the appetite." She added the lack of real sugar could inhibit the body from feeling full. Please follow Business Insider on Twitter and Facebook. Join the conversation about this story » Media Files bad-news-your-diet-soda-is-making-you-fat-too.jpg (JPEG Image)         Jim Rogers: The China Shorts Have Had It All Wrong, But At Least Hugh Hendry Admits It June 29, 2011 at 12:25 PM   The China shorts have got is all wrong thus far, and while the economy will continue to experience problems, it will make it through, says Jim Rogers in an interview with Index Universe. Rogers says that while hedge funder Hugh Hendry has admitted his China short is hurting him, Chanos has not thus far. He believes both, in the long-run, will be proven wrong. Jim Rogers, from Index Universe: Well, I feel sorry for them. They’ve been dead wrong for two years. Hugh Hendry has at least acknowledged that being short China is hurting him. I don’t know about Chanos—Jim said he was short, and if so, he’s hurting too. China has not gone down. It’s been two years now and, sure, there are going to be setbacks in China along the way, but China has not collapsed. We, in the U.S., had many depressions—with a “small d;” we had a horrible Civil War; we had very little rule of law; we had periodic massacres in the streets; we had virtually no human rights; you could buy and sell congressmen—well, you can still buy and sell congressmen in America, but they were cheap in those days. As recently as 1907, the whole system was broke in the U.S., and yet we were on the verge of becoming the most successful country in the 20thcentury. Maybe real estate speculators in Shanghai will go bankrupt. I expect that, I hope it happens; it would be good for China and it would be good for the world. But in the meantime, these guys shorting China have been dead wrong. But I want to repeat this: There will be massive setbacks in China, along the way. It’s the way the world works. If I see serious problems in China, I’m not going to stop teaching my children Mandarin. Rogers is also short U.S. treasuries and expects his position to grow. Read more about it here > Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: Things Might Get Ugly For Copper Chinese Economist: Monetary Policy Is Not The Reason For Small Business Slowdown China Just Put A Number On Its Local Government Debt         City Dwellers Are 21% More Likely To Develop Anxiety June 29, 2011 at 12:23 PM   Those who daily jam into a packed subway car, or navigate the streets of Tokyo or New York, are literally risking their sanity. Last year, Dutch researchers found that city dwellers have a 21% higher risk of developing anxiety disorders, and a 39% higher risk of developing mood disorders than those who live in the country. The Economist compares this research with a more recent study by Dr. Andreas Meyer-Lindenberg of the University of Heidelberg, who found that urban dwellers respond to stress differently. In his first experiment, Meyer-Lindenberg delivered a difficult math test while fellow researchers yelled at the participants during the exam. Functional MRI scans revealed that city dwellers were more stressed out. In particular, the scan looked at amygdalas, the structures in the brain that assess threats and fear, and the urbanites had the highest activity in that region of the brain; whereas those who live in the country had the lowest levels (and those who live in towns were somewhere in the middle). The scans also looked at the perigenual anterior cingulate cortex (pACC), which regulates the amygdalas, and found that in this case, it depended where the person grew up (regardless of where they live now). Those who were raised in a city had more uneven responses from the pACC, and a more disrupted connection between the pACC and amygdala. It's no surprise, then, that those two regions of the brain are usually "out of kilter" in schizophrenics -- and there's a higher percentage of schizophrenics who dwell in cities, says The Economist. Please follow Business Insider on Twitter and Facebook. Join the conversation about this story » See Also: Proof That Humans Are Born Capitalists Media Files tokyo-shibuya.jpg (JPEG Image)         Google Plans To Grow Display Advertising Into A $200 Billion Market (GOOG) June 29, 2011 at 12:22 PM   Google is known primarily for its work in search advertising. But it’s making an investment — a big one — in another area: display ads. This month’s acquisition of AdMeld was only the latest in a series of moves that are positioning Google for “the second phase of the display ad revolution.” According to the Wall Street Journal, around 1,000 of Google’s engineers are currently working on display technology. That’s not entirely surprising, given that growth in display continues to outpace search: In the first quarter of 2011, AdWeek reports, display comprised 33 percent of digital ad spend — an increase from 29 percent two years ago. (Search, on the other hand, declined: Q1 of 2011 saw 48.7 percent market share for search, a decline from 53.4 percent two years ago.) And Google itself, thanks in large part to its $3.2 billion acquisition of DoubleClick, is set to grab 12.6 percent of the U.S. display-ad market by the end of the year, up from 9.6 percent last year. What’s especially noteworthy, though, is the extent to which display has become a focal point for Google — and, by extension, for the products it offers to news publishers. In the first quarter of 2011, Google bested Yahoo in display for the first time in 16 years, largely on the strength of its push toward small and medium-sized company display buys. As a promotional website puts it, “Display advertising really is at the heart of what we’re doing at Google these days.” I had a chance recently to meet with some of Google’s top execs on display-ad strategy to get their take on how the sector is evolving — and what role they’d like to see Google play in it. Fragmentation and friction Display ads — banner, video, and mobile — currently comprise about a $25 billion market globally, says Neal Mohan, Google’s VP of product management for display advertising. But “we believe that the potential of the industry is dramatically larger than it is today,” he told me. In fact: “I believe the potential of the display market is something on the order of $200 billion over the course of the next several years,” Mohan says. The broad question he and his colleagues are focused on from a technological standpoint: “How can we help grow the overall pie — grow the overall industry — from the market that it is today to the $200 billion vision?” The broad answer: improve efficiencies in the relationships between publishers and advertisers. Display advertising as it currently operates is “massively fragmented,” Mohan notes. As media outlets proliferate — and as the devices we consume them on proliferate, as well — the A-to-B link between advertisers on the one end and media companies on the other becomes increasingly disconnected. “And as a result of this fragmentation,” Mohan says, “there’s tremendous friction” in the advertising process overall. Marketers and agencies end up using multiple types of interfaces, technologies, and ad networks to find the audiences they’re looking for among the mass of overall web users. “And what that leads to,” he notes, “is a destruction of value — a destruction of ROI, in terms of what marketers are looking to achieve, and fundamentally a destruction in the amount of revenue that a publisher can generate. So I believe that publishers can generate tremendously more revenue from display advertising than they do today. And our mission is to create the tools and the products and the technology that allow publishers to do that.” “An end-to-end-platform” Google being a technology company, “I think the way that Google can add value to this is by building technology for publishers and advertisers,” Mohan says. “Our vision is to build an end-to-end-platform for buying and selling display advertising, so a publisher doesn’t have to go to multiple places to manage its mobile inventory, its desktop inventory, its video inventory — whether it sells it directly or indirectly.” The platform may be plugged into other technologies, but it would also be, Mohan notes, a singular space: a one-stop shop for publishers and advertisers alike. The platform Mohan’s talking about isn’t a single product — it’s more a series of incremental products that serve the broad goal of a friction-free advertising process. And though Mohan describes the platform in the future tense, Google has already begun rolling out its building blocks, testing out components with publishers. And the publishers have seen a 188-percent lift in revenue as a result of it, he says. “I think we’re really in the first inning of what the implications of this technology are,” Mohan says. “You can imagine that if we’re seeing a 3x improvement just today, what that world will look like a year from now, two years from now, three years from now — and I think that’s the path to getting to that $200 billion vision.” And a big part of that vision will play out on mobile devices, within apps. “Speaking and breathing mobile” “What’s really evolved over the past three or four years is this apps ecosystem,” says Clay Bavor, Google’s product management director for mobile display ads. Apps facilitate “these experiences that are highly customized for mobile devices and tablets,” he notes. And “they create these beautiful experiences that are really tailored to the features and functions of the device.” While much has been made of smartphones’ and especially tablets’ effects on the presentation of publishers’ content, those effects, Bavor notes, are equally applicable to ads. For Google, he told me, one of the big challenges — and opportunities — is “making our products just speak and breathe mobile.” Google has two primary goals for its mobile display ads, Bavor told me. On the one hand, it’s to “allow advertisers who are used to advertising on desktop to seamlessly extend their campaigns and metrics and measurements to mobile.” On the other hand, though, it’s to work with apps as their own kind of spaces and experiences — building ad formats that are native to the app environment rather than simply grafted onto it. Ads that are swipe-able, tap-able, rotate-able, and “that really make use of the unique properties of smartphones and tablets.” In May, Google rolled out a series of new HTML5-based ad formats that were, Bavor noted at the time, “built specifically for tablets’ larger, high-definition screens.” But those tablet-native ad units aren’t just aesthetic propositions; they’re practical, as well. Go where the people are is as relevant to Google as to anyone else in and among the media; and where Internet users are, increasingly, is everywhere, rather than seated in front of computers. The first quarter of 2011 saw smartphone sales of over 100 million — an 85-percent increase from 2010. And traffic from tablets on Google’s AdMob network increased 300 percent between December 2010 and May 2011. And “if you just look at the people using mobile ads to support their app or mobile content,” Bavor says, “that’s growing like crazy, too.” In January of this year, he notes, Google had about 50,000 developers and publishers using AdMob to monetize their apps and mobile websites. By May, that number had jumped to more than 80,000. Which is a reflection of what Eric Schmidt, on behalf of Google, has been saying for some time now: The future is mobile — and it will play out on, and within, and through, smartphones and tablets. “That,” Bavor says, “is where we’re placing our big bets right now.” Creativity and engagement And that could also lead to a new kind of display ad, which could, in turn, “support the next big wave of content creation and application development and so on on the Internet,” Bavor says. Bavor has been meeting with publishers to determine what both groups actually want from an ad platform. And one broad, if unsurprising, thing he’s heard repeatedly is the importance of direct sales. “If I get a call from Ford,” he says, “and they want to place an ad — help me manage that relationship. Help me help them create beautiful formats that look great in the context of our tablet app. Make that great and easy for me. And, to the extent possible, make it an extension of my existing tools.” “Whether it’s direct sales or any other aspect of monetization,” Bavor notes, “the last thing any of these publishers want is yet another tool or workload to think about.” What they do want, though, is ads that are both easy and, even more importantly, impactful. And Google believes that the path it’s on now will benefit publishers and advertisers — and, by extension, users. As Mohan put it in a speech to the Interactive Advertising Bureau earlier this month, “Display ads provide an incredible platform to engage, excite and inspire. If we as marketers, publishers and technology providers can deliver experiences that delight the user, we can take this industry to new heights.” This post originally appeared at Nieman Journalism Lab. Please follow SAI on Twitter and Facebook. Join the conversation about this story » See Also: GOOGLE: Here's Why We're Launching Google + Media Files google-plans-to-grow-display-advertising-into-a-200-billion-market.jpg (JPEG Image)         SocGen's Commentary On Obama's Press Conference: No Progress Has Been Made On The Debt Ceiling June 29, 2011 at 12:14 PM   Just out from Societe Generale regarding Obama's press conference: Nothing surprising from Obama's speech. It looks like there has been no progress made in his negotiations. He is standing buy the need to raise revenue in order to balance the budget. We believe that given the numbers he is correct. We continue to view a last minute deal for a small increase in the debt ceiling with token budget cuts is the likely scenario. Republican leaders have indicated they are open to this possibility. Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: Debt Ceiling Decision Tree: How To Figure Out If Washington Is Going Blow It Media Files socgens-commentary-on-obamas-press-conference-no-progress-has-been-made-on-the-debt-ceiling.jpg (JPEG Image)         Regulators Ask Banks to Beef Up Security June 29, 2011 at 12:12 PM   U.S. financial regulators asked banks step up security measures, as governments and corporations look to overhaul their systems in the wake of recent hacking attacks. The Federal Financial Institutions Council recommended banks perform regular risk assessments and keep customers informed of online banking security issues. The Council especially urged banks to demand more than one form of customer authentication, as hacking risks increase when people log into online accounts. "Fraudsters have continued to develop and deploy more sophisticated, effective and malicious methods to compromise authentication mechanisms and gain unauthorized access to customers' online accounts," the council warned. Banks and governments alike may benefit from a ramp up in security efforts, especially as hackers become bolder and more ambitious in their methods and targets. The recommendations come on the heels of a string of recent government and corporate hacks. In May, hackers stole $2.7 million from Citigroup by attacking over 360,000 exposed accounts. In April, hackers also hit U.S. Bank and Capital One after targeting corporate e-mail and marketing firm Epsilon. Meanwhile, the International Monetary Fund is still trying to figure out who broke in and stole internal files earlier this month. Besides major banks, hackers crippled entertainment giant Sony and irked various worldwide governments over the last several months, lending weight to the council's warning against flimsy security. Sony's data breach, the biggest in history, exposed over 100 million accounts, while hacks against U.S. Senate, CIA and NATO websites merely embarrassed the agencies. Governments are fighting back. Turkey and Spain arrested 35 total members of the hacktivist group Anonymous, who are believed responsible for some of the damage, while the Obama administration beefed up defenses by proposing a new cyber-security initiative that doubles prison times for hacking. In addition, the Pentagon said it will treat cyber-threats to national security like traditional militaristic offensives. As one military official said, "If you shut down our power grid, maybe we will put a missile down one of your smokestacks." Beyond military action, the U.S. Department of Commerce is contemplating rewarding companies that increase security measures. For example, the DoC may spare them legal liabilities if they're hacked while running the latest technology. Such incentives may prove useful in bringing companies and government agencies up to speed against would-be hackers. "The Internet is again at a crossroads. Protecting security of consumers, businesses and the Internet infrastructure has never been more difficult," said Commerce Secretary Gary Locke. "Cyber-attacks on Internet commerce, vital business sectors and government agencies have grown exponentially." This post originally appeared at Mobiledia. Please follow SAI on Twitter and Facebook. Join the conversation about this story »         China's Diesel Smile June 29, 2011 at 12:11 PM   Did OECD leadership, under severe pressure from a financial crisis in Europe and a newly weakening economy in the US, release government oil inventories in part to please China? Was the IEA’s release of oil reserves a swap for the loosening of China’s capital reserves? (see: Wen Says China Is a Long-Term Investor in European Debt.) Generally here at Gregor.us I avoid exactly this type of  geo-political speculation. But weekend remarks from China’s Wen Jaibao that Euroland bond markets would be well supported by China comes after a dramatic move downward in Brent crude—the global grade from which the developing world makes diesel. The dumping of light sweet oil into the Gulf Coast market  had its greatest price effect on Brent crude—not West Texas Intermediate—as WTI remains landlocked in Cushing, Oklahoma. Indeed, it is inescapable that OECD policy markers understood that global diesel and gasoil markets, starved for light sweet oil, would be most affected by the release. A swap, in which OECD oil reserves are offered in exchange for China’s continuing reinvestment of capital reserves, is a big win-win (temporarily) for both Western and Asian economies. Unless, of course, it isn’t. Because the IEA’s Nobuo Tanaka has kicked off this week reminding markets his organization can release more oil if needed—thus signalling IEA’s new plan to keep the downward pressure on oil running full tilt—we should quantify how much oil IEA/OEC controls. | From the May 2011 IEA Oil Market Report, see: Total OECD Oil Stocks–the Government Controlled Column–in millions of barrels. Total government controlled oil stocks as of Q1 2011 amounted to 1558 million barrels. At the current release rate of 60 million barrels a month, western governments could continue this program for just over two years. The calculation also holds true for the US contribution of 30 million barrels a month from its own government reserves (SPR), which currently stands at 972.5 million barrels. But surely even the most casual observer understands such a program is not sustainable. The world cannot run on inventories. Indeed, among the problems I articulated in last week’s post, The Dark Side of the Oil Inventory Release, is the counterintuitive result that releases of oil inventories which are intended to dampen price contain a bullish, not a bearish, signal for the oil market. Furthermore, were the IEA in conjunction with its OECD participants to continue its oil inventory dumping into Autumn, the oil markets would then have to start pricing in a new reality: lower government stocks of oil. After all, government stocks of oil are intended to mitigate disruptive, geo-political events. If the OECD were to lower its reserves by 10%, then the market would be obligated to price in new risk. Regardless of whether China has agreed to more quickly marshal its capital reserves, in return for a temporary oil price knockdown, the current trajectory of its oil demand is largely governed by diesel, as domestic consumption roars. China’s extraordinary demand growth for diesel can be seen in various ways. Firstly, as a crunch that takes place at the crossroads of its transport and power sector, as was nicely articulated at FTAlphaville late last year. But principally, as a crunch that’s driven mainly by the heady growth in automobile and truck sales. In a post earlier this year, China Sign Post correctly noted that heavy truck sales more accurately signal China’s demand growth for oil. | from the article at China Sign Post see: Estimated additional diesel fuel demand from new heavy trucks sold in China, in million barrels per day. So is China smiling after the stock releases, of the past few days? West Texas Intermediate crude oil is currently back at the $95 level, right where it was trading prior to last week’s action. Brent crude oil, which fell as low as $102, is also back above $110. As Dave Cohen points out in a post earlier this week, Brace Yourselves For The Next Oil Price Shock, China’s demand for oil can almost entirely be understood through the lens of diesel. And, that diesel itself is unique. Never underestimate the role middle distillates play in driving crude oil prices. If diesel is in great demand, and clearly it will be given the Chinese scenarios laid out above, the “best” oil which provides the highest quantities of this product via the refining process is also in great demand. If there isn’t enough of it to go around, prices spike. Ethanol substitutes for gasoline. At large scales—just about anything bigger than the gas tank of Willie Nelson’s bus—nothing substitutes for diesel. Unfortunately, it does not appear OECD nations have been successful in getting the price of oil down below $100. There remains a justifiable suspicion that Saudi Arabia cannot supply the market either with extra light sweet oil, or with extra oil of any grade, for longer than a month or two. If China and Western countries have indeed made an arrangement to swap these oil price knock-downs for support of Western sovereign debt (at the margin), China would be advised to fill its own inventories quickly when these brief, five-to-seven day discounts on oil arrive, only to disappear. -Gregor Read more posts on Gregor.us » Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         Risk Returns, Dollar Buying Ends June 29, 2011 at 12:07 PM   Well, the "is this Greece's Lehman Brothers moment" talk has subsided, this morning, as today Greece votes on the austerity measures in the budget… As I've said now for the third day in a row, the real stickiness comes tomorrow, when they vote to "implement" the measures… I do believe that both votes will be positive, but not without a few fingernails chewed, while pacing back and forth in a worrisome state. If both votes pass, then Greece will receive the next tranche of their original bailout package, which was due to be paid to them next month, which is very quickly coming at us like a freight train! In two days, we'll be to July… So, this vote is what you would say "in the nick of time"… The markets are generally on board with what I just told you, regarding the outcome of the votes, and have begun to reverse the dollar buying we saw at the end of last week… Currencies are generally better off this morning than they were on Monday morning, with the euro (EUR) leading the way. Gold actually found a bid yesterday, and the gold price found its way back above $1,500… But that's to be expected, given the reversal of the dollar buying going on. The protesters in Greece are none-too-happy about the possible outcome of the two votes, today and tomorrow… I know that the measures hurt… But isn't it better to hurt a little now, than to get to your retirement and find that there's nothing there? No money? No benefits? Nothing, absolutely nothing! Say it again! The Greek protesters are making the cable news, just about every hour, and are in competition with the Casey Anthony case for air time… And the price of oil also rebounded last night and this morning, moving up $2… So, as you can imagine, or guess, the risk aversion that was ON late last week, and earlier this week, has been transferred to the risk takers, which means the high yielders are doing well, and outperforming all other currencies this morning. And the 200 lb gorilla in the corner (China), is coming out of the corner to let everyone know that they believe in the Eurozone, and the euro, and will continue to support them. Following up on his comments earlier this week, Chinese Premier, Wen Jiabao, (Wen) said that, "The difficulties that have appeared in Europe are temporary. As long as financial reforms and adjustments continue, the difficulties can be gradually overcome. At Europe's time of difficulty, we reached out a helping hand. We expressed confidence in Europe's economy and confidence in the euro. We have also said that we will buy a certain amount of sovereign debt from some countries, according to needs." Well… As long as he's not blowing smoke in our faces… That's the kind of stuff that helps a region like the Eurozone… And its currency, the euro… Ok… I saw something yesterday that made me just stop, and begin writing about it, for it so angered me, that the only way I could keep my blood pressure from soaring was to pound on the keyboard… So, here are my thoughts, as I pounded on the keys yesterday…. It's The Only Game in Town… No… My beloved Cardinals aren't in town… And I'm not talking about the Ringling Bros. traveling circus, or Cirque du Soleil! I'm talking about our beloved Federal Reserve, maintaining their Treasury buying, even with the so-called end of QE2… The economy, as I've been telling you for months now, is not self-sustaining at this point… And I feel that the US economy has taken a page out of the Japanese economy's book on "how to become addicted to government stimulus"… So… Enter the Fed Reserve, which at this point is scheduled to buy at least $300 billion worth of Treasuries in the next year… It's the only game in town, folks… Without them buying, the Treasury market would be a mess! I had a reader send me a note on this yesterday, and the note said that we can call this QE2.5! Another customer sent a note and said that we should have a contest to see who can come up with the most creative name for the Fed's Bond Buying program, the artist formerly known as "quantitative easing"… But quite frankly, I can barely keep up with the emails I receive now, so, I'll pass on holding that contest… But it does bring to mind the thought that this will continue to be the only game in town for some time… And if Japan is any indication – which I do believe it is, and have been telling you so for a long time – then we could be doing the do-se-do with the Fed buying Treasuries to stimulate the economy and ballooning their balance sheet for a loooonnnggg time! OH! And before anyone thinks I made this $300 billion number up… It was reported on CNN.com, which is where I read it, and began to feel my blood pressure rise… It's like the Fed is singing along to the song that's playing on my iPod right now… "Hard Habit To Break"! (One of my all-time fave Chicago songs)… A piece of data that just came across the screens shows that Canadian inflation is soaring… (They apparently don't have hedonic adjustments to keep inflation in line!) Canadian CPI (consumer inflation) rose 3.7% in May versus May 2010… So that's another item to put on the side of the ledger that's keeping track of the reasons to hike or not hike rates… This news has the Canadian dollar/loonie (CAD) pushing higher versus the green/peachback this morning. And… Yesterday's data showed us that home prices continue to fall… The S&P/CaseShiller Home Price Index printed a -3.96% drop in prices from a year earlier… Not the -4% that was thought would print, and I heard some talking heads on the cable news saying that the number was so much better… Come on! Get a grip! 3.96% is so darn close to 4% that rounding would probably put us at 4%! Geez Louise! And in a surprising data print… Consumer confidence fell this month… As it should, but usually doesn't go along with my thoughts on confidence… OK… So… The euro is back to 1.44 as I write, and the Aussie dollar (AUD) is back to $1.06… The Swiss franc (CHF), which I told you yesterday would clear the $1.20 hurdle, did just that and is $1.2025 this morning… So, you get a flavor of what I said at the top regarding the dollar-buying ending, for now… I say "for now" because there's no way that the Eurozone is out of the woods, just because Greece ends up kicking the can down the road… So, we could continue to see these bouts of dollar buying as we head to the dog days of summer, but only until the markets see what I said above, that the US economy is not self-sustaining at this point, and their knee-jerk reaction to this will be to scream for more stimulus… There were two things going on with Greece, folks… You had the next payment of their bailout being held hostage until the austerity measures could be put in place, and… You have the ongoing bond maturities that need to get paid… And here's where, as I've said for a few months now, with most of the Greek debt held by Eurozone banks, the banks could agree to extend or "rollover" these maturities to longer dated bonds, thus pushing off the problems of paying the bonds now… Maybe if the Greeks actually implement and carry through with the austerity measures, then by the time the bonds need to be paid, or the interest needs to be paid, Greece's balance sheet looks a lot healthier… Maybe… Then here in the US we have the same problems… No, no one is holding back a bailout payment to us… What I'm talking about is the debt in this country… You know, the people and government officials in Greece didn't think they had a debt problem, until they did… And that's the same here… And I still believe that within a month we could be watching another financial calamity here in the US. Sure the Fed is going to keep buying $300 billion of Treasuries next year, but that would only cover three auctions… The budget deficit will be $1 trillion, you can count on that… And this could be what triggers that financial calamity… Here in the US, the number of banks below regulatory capital levels has increased to 175, and that was at the end of the first quarter! At the end of the first quarter of 2007, there were only 7 that failed to meet this criteria. When this happens, bank examiners are required to take prompt corrective action to resolve the problem. The FDIC's balance sheet has turned red to the tune of $50.7 billion… I don't like having to talk about that stuff, because I work in a bank… But I don't worry about our bank… I even get upset when people blame bankers for the economy's problems… And I really don't like it when the say "fat bankers"… Hey! I take offense at that! (Ok, if you've never met me face to face, you won't get that joke! Then there was this… I saw a piece on TV yesterday talking about lending activity, or better, the lack of lending activity… The people were discussing their reasons for the lack of lending activity… I can tell you this… It's a serious case of "damned if you do, and damned if you don't"… Banks and lending institutions were damned for lending to people who had no ability to repay their loans, and that blew up in their faces… And banks and lending institutions were damned for not lending to people who have no ability to repay their loans… And unfortunately, this too will blow up in their faces… And it's just like everything we see in life… Something goes along until there's a problem, and the correction takes the problem 180 degrees the other way, until the correction seems to be completely wrong too! But it goes deeper than that, folks… I can tell you from personal experience that having an excellent credit score, more than enough money in the bank, and making a sizeable down payment, I was put through the ringer, not once, not twice, but at least three times… If I had known I would have to go through the ringer once, I would have just walked away… Banks, for the most part, are trying to clean up their balance sheets, just like consumers… So for now, lending activity is not going to be the stuff that strong economies are built on… And there will not be any "velocity of money"… To recap… The currency mini-rally has turned to an all-out rally, with dollar buying that began late last week ended. The risk aversion people have gone back to their caves, and the risk takers are giddy about the prospects of two positive votes from Greece… Of course, there's risk in doing that, but that's not the worry right now… Oil and gold rebounded, as dollar weakness became the order of the day… The Fed is going to continue to buy Treasuries next year according to CNN.com, and China's Premier talks up the Eurozone and the euro… Chuck Butler for The Daily Reckoning Risk Returns, Dollar Buying Ends originally appeared in the Daily Reckoning. The Daily Reckoning provides 400,000+ readers economic news, market analysis, and contrarian investment ideas. The Daily Reckoning features articles by Addison Wiggin author of Empire of Debt and Bill Bonner author of Financial Reckoning Day and The Idea of America. Read more posts on The Daily Reckoning » Please follow Money Game on Twitter and Facebook. Join the conversation about this story »         Bad News For Partisan Hacks: Markets Rise After Obama Slams Fat Cats June 29, 2011 at 12:07 PM   There's nothing in Obama's speech that's particularly market-moving. But if you listen closely, you can hear partisan hacks tearing up their column because the market didn't tank once Obama slammed fat cats. (For an example of a political pundit blaming Obama for the economy, see here.) In fact, stocks are up in the last 30 minutes since the speech started. Please follow Money Game on Twitter and Facebook. Join the conversation about this story » Media Files chqrt.jpg (JPEG Image)         THE APPLE INVESTOR: Apple Doesn't Address 70% Of The World's Mobile Phone Market (AAPL) June 29, 2011 at 12:05 PM   The Apple Investor is a daily report from SAI. Sign up here to receive it by email. AAPL Sideways As Market Rises  Stocks are up mid-week after the Greek parliament passed an unpopular austerity plan critical to avoid a debt default. Shares of AAPL are trading sideways, while the markets have recovered in the positive after an early morning sell-off. Catalysts include second quarter results released the third week in July (TBA); the next iPhone launch this fall; smartphone push into China and emerging markets; iCloud rollout and adoption; the continued evolution and next generation of Apple TV; and new platforms such as books / publishing and social (Ping). Shares of Apple trade at 11x Enterprise Value / Trailing Twelve Months Free Cash Flow (including long-term marketable securities), low versus historical standards. Analyst Raises Third Quarter Estimates Based On iPad And Mac Sales (Barron's) Needham analyst Charlie Wolf raised estimates based on predictions about Apple's Mac and iPad shipments. In terms of the iPad, competitors "have made an imperceptible dent in the trajectory of iPad sales". He upped his iPad sales estimate for the fiscal third quarter to 9 million units, an increase from 7.5 million. Mac unit estimates he raised from 3.75 million to 4.25 million for the quarter. He also increased his long-term revenue and EPS forecasts for Apple. For fiscal 2011 he sees just under $103.6 billion in revenue, with EPS of $25. Clash Of The Analysts: Will There Or Won't There Be A Low-End iPhone Released? (AppleInsider) Another analyst has countered recent reports that Apple plans to release a cheaper iPhone for the pre-paid mobile market. BMO Capital's Keith Bachman believes that the iPhone 3GS will continue to serve as the company's "low-end" handset. FBR Capital Markets analyst Craig Berger agrees with Bachman that a low-price iPhone is unlikely. This is in contrast to Deutsche Bank's Chris Whitmore, who has stated a mid-range, contract free $300-$500 iPhone will launch in September. Nearly 70% Of The World Not Being Addressed By The iPhone (Asymco) Speaking of cheaper phones, according to research firm Asymco, nearly 70% of the world's population uses pre-paid phones. So far, Apple is missing in action in that marketplace. Despite Apple’s recent decision to offer a contract-free iPhone, the handset remains ridiculously expensive. The company will eventually fill 100% of the post-paid market through the expansion of carrier agreements. When put in these terms, why on earth wouldn't Apple address the low-end? A Tale Of Two iPhones: Just Look At Apple's Product History (Daring Fireball) John Gruber would agree. He says there is a bit of evidence of the release of a low-end iPhone amongst the scraps of information that have leaked regarding new iOS hardware. More importantly, it makes strategic sense. Eventually Apple is going to expand the iPhone to multiple tiers as in multiple new products. It’s just a matter of when. Examine the history of the iPod. Apple presses technologically at the high end, and the company expands into the mid-range market with lower priced models. Why not now? Apple The Top Mobile Device Vendor In Australia As Nokia Takes A Dive (IDC) Apple has become the top mobile device vendor in Australia for the first time, with nearly one third market share, according to IDC’s Q1 2011 Mobile Device Tracker report. The market there has mainly been dominated by Nokia, but this year the Symbian platform has seen a huge tumble along with a dip in demand for feature phones mainly due to the rise in smartphones and consumers shying away from the platform ahead of the transition to Microsoft's Windows Phone. Google Seeing 500K Android Devices Activated Every Day (Various via techDygest) Half a million Android devices are activated every day, a number that's growing 4.4% each week, Google's Android chief Andy Rubin revealed in a tweet. That means that Android could hit 1 million daily activations by October if this growth rate maintains. Henry Blodget at Business Insider says this leaves Apple in the dust. Back in January, Apple announced (in a roundabout way) over 360,000 daily iOS activations, and at that time Google was seeing 300,000 activations. Getting to $14 billion in mobile ad revenue in the next 4 years doesn't seem so far-fetched. Daily Trader: Samsung Replaced By TSMC As The A6 Processor Maker (Various via iDygest) It is speculated that the move to give Taiwan Semiconductor Manufacturing Company (TSMC) exclusive manufacturing of the A6 may be a result of Apple's lawsuit against Samsung. Increasing legal tension between the two companies has prompted Apple to switch to contract fab to TSMC to build its next-generation A6 chip. Samsung is the company contracted by Apple to build the ARM chips found inside the iPhone 4, iPod touch 4th generation, and iPad. Could be a decent short-term pair trade. Please follow SAI on Twitter and Facebook. Join the conversation about this story » See Also: No Cheap iPhone 4S This Year, Instead Apple Makes The iPhone 3GS Free, Says RBC THE MICROSOFT INVESTOR: Windows 8 Could Be Revealed As Soon As September The Org Charts Of All The Major Tech Companies (Humor)         Startup Apture Wants To Change How The Web Works June 29, 2011 at 12:00 PM   The Web is built on hyperlinks, but San Francisco startup Apture thinks there's room for improvement. The problem: what happens when you're reading a Web page and you want more information about a term or person mentioned in it, but there's no hyperlink? Today, you highlight the term, paste it into the Google search bar, open a new browser tab, follow the search result to a source, and when you're satisfied, go back to the original story you were reading. It's distracting for users and bad for publishers, as some percentage of readers get distracted and never return. Apture has been thinking and working on the problem for three years now, and today it introduced an interesting solution called HotSpots. Publishers use a couple lines of JavaScript to add HotSpots to a Web page. The system keeps track whenever a reader highlights a term to paste into a search engine. If it sees that people are curious about a particular term and highlighting it often, it automatically adds a special Apture link to that term. But it's not a normal hyperlink that pushes readers to a new Web page -- instead, users can hover over the link and see a window with information like Wikipedia entries, YouTube videos, and Google Image Search results. You can check it out on this story from the Denver Post. The basic technology has been in place for a while -- but before, Apture would only show more information when users actively highlighted a term. With HotSpots, the links are automatically added as a particular term becomes more popular. One possible stumbling block: users may expect Apture links to lead to advertisements and ignore them. (There are already a bunch of companies that sell ads this way, like TextLinkAds.) CEO Tristan Harris said that Apture is trying to show readers that it's different from these ad links. For instance, most ad links show up immediately whenever users move their mouse over them, but Apture links have a slight delay. So they only show up when you REALLY want them. It's an interesting idea by itself, but imagine what a big Web company like Facebook, Google, or Microsoft could do with the technology -- instead of forcing users to come to them, they could take their services (and advertisements) directly to users, wherever they are on the Web. Please follow SAI on Twitter and Facebook. Join the conversation about this story » See Also: Inside Billion Dollar Vente Privée's Secret, Amazing HQ (PHOTO TOUR) Peter Thiel: If I'd Known, I Would Never Have Started PayPal Check Out Flipboard's Minimalist, "Inside Of An iPod" Office -- And The Huge New One They're Planning To Move Into (PHOTO TOUR)         IN HER SHOES: Walk With Anna Wintour To Her New Conde Nast Office* June 29, 2011 at 12:00 PM   Conde Nast is moving to One World Trade Center in 2014. The $2 billion deal will bring a host of beautifully dressed Conde kids to the financial district. Monday night, we went wandering around to see what they can expect. We started on Sullivan street near the townhouse of Vogue savior Anna Wintour, mirrored her walk to work (not that she will ever walk), and wandered around the area snapping photos. The conclusion: There's not much to eat (although that will undoubtedly change by the time CN moves in), there are hundreds of people constantly moving about (it will only get more crowded when the magazine company's thousands of staffers arrive along with their town cars), and the ill-fitting suits of the masses will get a major upgrade. Wintour's street with the World Trade Center rising up in the background. A little inspiration early in the morning. Nice choice of magazines on the local newsstand. See the rest of the story at Business Insider Please follow The Wire on Twitter and Facebook. See Also: How Vogue Editor Anna Wintour Saved Her Magazine And Her Job 7 Lessons From The Most Costly TV Failures In History Check Out What Happened This Week In History         How Jim Fowler Sold Jigsaw to Salesforce for $142 Million June 29, 2011 at 12:00 PM   As Chief Executive Officer, Jim Fowler provides direction and leadership toward the achievement of goals and objectives at Jigsaw. A veteran sales executive, Jim has more than 12 years selling software for marketing and collaboration applications. Before starting Jigsaw, Jim served as VP of Sales at Digital Impact (DIGI), Paramark and TightLink. In these roles, he built sales departments from the ground up focusing on sales strategies and processes. He was able to leverage his experience as an outstanding sales manager at Personify and NetGravity. Prior to his career in software sales, Jim owned and operated Lookout Pass, a ski resort in Idaho. He also served in the US Navy as a Diving and Salvage Officer. Watch the video of the fascinating story of how Jigsaw was built, positioned and sold for $142 million to Salesforce, thus helping it become a market leader. Read more posts on Ramon Ray & the Smallbiztechnology.com Team » Please follow SAI: Tools on Twitter and Facebook. Join the conversation about this story »         Mobile with Mario: Contest, ooVoo, and Odd Habits of Small Biz Owners June 29, 2011 at 11:55 AM   Welcome to our weekly Mobile with Mario column. Each week we bring you articles from Small Biz Go Mobile’s Mario Armstrong – tech expert, commentator and digital lifestyle expert – featuring hot topics, products and trends in mobility and small business. It’s Official: Smartphones are More Important than Hygiene When we last checked in with Manta, they released some promising survey data indicating that Small Businesses are hiring. Their latest survey, however, tells us a little bit more about the modern Small Business owner and entrepreneur. While it's within their margin of error, more small business owners check their email on their mobile device first thing in the morning (32%) than brush their teeth (31%). The age of the smartphone has truly arrived. Check out the full survey information and more about the new Manta app for iPhone here. Even Construction Workers are Doing Mobile Teleconferencing with Oovoo Last week, the Small Biz Go Mobile team got to check out some of the coolest new technologies at Digital Experience 2011 in New York City. One exhibitor that really caught our attention was the ooVoo booth. The folks over at ooVoo claim they can fix the problems with other teleconferencing platforms, and from what we’ve seen they might be right. Now, you can easily meet with the guys in LA, New York, Detroit, Austin, and Chicago simultaneously–even from your mobile device. Win a Free Business Consultation with Tech Expert Mario Armstrong The Small Biz Go Mobile team is running a huge contest this week, giving away three chances to win a 20-minute one-on-one call with digital lifestyle expert Mario Armstrong. Want to know how to best take advantage of your smartphone or tablet? Have questions about branding or social media? Just want someone to bounce some business ideas off of? Mario Armstrong is here to answer your pressing questions. The contest is free and easy to enter, so why not head over and enter today! Read more posts on Ramon Ray & the Smallbiztechnology.com Team » Please follow SAI: Tools on Twitter and Facebook. Join the conversation about this story »         Chinese Economist: Monetary Policy Is Not The Reason For Small Business Slowdown June 29, 2011 at 11:54 AM   A Chinese foreign exchange regulator fired back at critics who have been blaming monetary tightening for the credit shortage woes of small and mid-sized businesses in the country. Via Marketwatch: Wang Daxian of the Shanxi branch of the State Administration of Foreign Exchange wrote in an essay in the Shanghai Securities News that the supply of credit is appropriate and liquidity in the market hasn't been substantially tightened. Wang pointed to other factors behind the problems of small and medium sized companies, noting that China's major investment projects are usually undertaken by state-owned companies, mainly those directed by the central government. The demand for credit from these big state projects often crowds out demand from the private sector, particularly for smaller firms. So it isn't the state's fault that private businesses can't compete with the state because of state regulations. China's central bank has raised bank reserve requirements 6 times this year in an effort to combat inflation. In the latest hike (June 20th), the requirement for most large banks reached 21.5%. Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: China Just Issued A Warning To Anyone Worried About Inflation China Just Put A Number On Its Local Government Debt Why QE2 Isn't Over When QE2 Is Over Media Files china-bank.png (PNG Image)         Here's Why The US Is An Even Bigger Kleptocracy Than Greece June 29, 2011 at 11:53 AM   If we dare look at the plain facts of the matter, we have to conclude the U.S. is a kleptocracy not unlike Greece, only on a larger and slightly more sophisticated scale. Yesterday, I noted that Greece Is a Kleptocracy; the U.S. is a kleptocracy, too. Before you object with a florid speech about the Bill of Rights and free enterprise, please consider the following evidence that the U.S. is now a kleptocracy worthy of comparison to Greece: 1. Neither party has any interest in limiting the banking/financial cartel. The original Glass-Steagal bill partitioning investment banking from commercial banking was a few pages long, and it was passed in a few days. Our present political oligrachy spends months passing thousands of pages of complex legislation that accomplishes essentially nothing. As Federal Reserve Bank of Kansas City President Thomas Hoenig recently noted (in a rare admission by an insider--I wonder how long it will be before he "resigns to pursue other opportunities," i.e. is muzzled): The problem with SIFIs ("systemically important financial institutions," a.k.a. too big to fail banks) is they are fundamentally inconsistent with capitalism.They are inherently destabilizing to global markets and detrimental to world growth. So long as the concept of a SIFI exists, and there are institutions so powerful and considered so important that they require special support and different rules, the future of capitalism is at risk and our market economy is in peril. Do you really think Dodd-Frank and all the other "fooled by complexity" legislation has accomplished anything? Hoenig cuts that fantasy off at the knees: As late as 1980, the U.S. banking industry was relatively unconcentrated, with 14,000 commercial banks and the assets of the five largest amounting to 29 percent of total banking organization assets and 14 percent of GDP. Today, we have a far more concentrated and less competitive banking system. There are fewer banks operating across the country, and the five largest institutions control more than half of the industry’s assets, which is equal to almost 60 percent of GDP. The largest 20 institutions control 80 percent of the industry’s assets, which amounts to about 86 percent of GDP. In other words, nothing has really changed from 2008 except the domination of the political process and economy by the financial cartel has been masked by a welter of purposefully obfuscating legislation. This is of course the exact same trick Wall Street used to cloak the risk of the mortgage-backed derivatives it sold as "low risk" AAA rated securities: by design, the instruments were so complex that only the originators understood how they worked. That is the current legislative process in a nutshell. Much of the 60,000 pages of tax code are arcane because they describe loopholes and exclusions written specifically to exempt a single corporation or cartel from Federal taxes. The U.S. is truly a kleptocracy because its political leadership actually has no interest in limiting the banking/financial cartel. When questioned why their "reforms" are so toothless, legislators wring their hands and bleat, "Honest, I wanted to limit the banks but they're too powerful." Spoken like a true kleptocrat. 2. Our stock markets are dominated by insiders. It is estimated that some 70% of all shares traded are exchanged in private "dark pools" operated by the TBTF banks and Wall Street, and the majority of the remaining 30% of publicly traded shares are traded by high-frequency trading machines that hold the shares for a few seconds, or however long is needed to skim the advantages offered by proximity to the exchange and speed. If that's your idea of an "open market," then you're the ideal citizen for a kleptocracy. 3. The rule of law in the U.S. has been divided into two branches: one in name only for the financial Elites and corporate cartels, and one for the rest of us mere citizens. Between corporate toadies on the Supreme Court who have granted corporations rights to spend unlimited money lobbying and buying legislators as a form of "free speech"--ahem, how can something that costs billions of dollars be "free"?--and vast regulatory brueacracies that saw nothing wrong with MERS and the complete corruption of land and mortgage transfer rules, the U.S. legal system is now a perfection of kleptocracy. As economist Hernando de Soto observed in The Destruction of Economic Facts, the ForeclosureGate mortgage mess is not just a series of petty paperwork mistakes--it is the destruction of the entire system of trustworthy transfer of property rights for non-Elites: Knowing who owned and owed, and fixing that information in public records, made it possible for investors to infer value, take risks, and track results. The final product was a revolutionary form of knowledge: "economic facts." Over the past 20 years, Americans and Europeans have quietly gone about destroying these facts. The very systems that could have provided markets and governments with the means to understand the global financial crisis—and to prevent another one—are being eroded. Governments have allowed shadow markets to develop and reach a size beyond comprehension. Mortgages have been granted and recorded with such inattention that homeowners and banks often don't know and can't prove who owns their homes. In a few short decades the West undercut 150 years of legal reforms that made the global economy possible. The results are hardly surprising. In the U.S., trust has broken down between banks and subprime mortgage holders; between foreclosing agents and courts; between banks and their investors—even between banks and other banks. Frequent contributor Harun I. summarized the reality of this political and financial coup by kleptocrats: As described by Georgetown University bankruptcy expert Adam Levitin, in testimony to subcommittee of the House Financial Services Committee, "If mortgages were not properly transferred in the securitization process, then mortgage-backed securities would in fact not be backed by any mortgages whatsoever, [and] could cloud title to nearly every property in the United States." It would also raise the question of the legality of the resulting millions of foreclosures on American homeowners, since the banks cannot prove "ownership" of the foreclosed property. The statement above gets to the elemental issue that apparently is lost on many otherwise intelligent people. This is not about frivolous claims based on technicalities. This is about securities fraud (theft) on a ludicrously massive scale. These so-called securities were sold to governments, pension funds and other financial institutions globally. Trillions were made by banks selling what is becoming clearly understood to be worthless pieces of paper and when the jig was up, which ultimately led to the destruction of economies globally, they made ordinary citizens the losers by sliding their worthless pieces of paper to the balance sheet of taxpayers worldwide. And while some are quibbling over whether someone should get a free house, those who have perpetrated the greatest swindle in the history of mankind are about to get away with it, because they are "systemically important", code for TBTF (too big to fail). You think money laundering and tax evasion is a specialty only of Caribbean island "banking centers"? Think again; we have corporate oversight equivalent to that of Somalia. U.S.A. a haven for corporate money laundering: A little house of secrets on the Great Plains: Among the firm's offerings is a variety of shell known as a "shelf" company, which comes with years of regulatory filings behind it, lending a greater feeling of solidity. "A corporation is a legal person created by state statute that can be used as a fall guy, a servant, a good friend or a decoy," the company's website boasts. "A person you control... yet cannot be held accountable for its actions. Imagine the possibilities!" "In the U.S., (business incorporation) is completely unregulated," says Jason Sharman, a professor at Griffith University in Nathan, Australia, who is preparing a study for the World Bank on corporate formation worldwide. "Somalia has slightly higher standards than Wyoming and Nevada." The U.S. was declared "non-compliant" in four out of 40 categories monitored by the Financial Action Task Force, an international group fighting money laundering and terrorism finance, in a 2006 evaluation report, its most recent. Two of those ratings relate to scant information collected on the owners of corporations. The task force named Wyoming, Nevada and Delaware as secrecy havens. Only three states - Alaska, Arizona and Montana - require regular disclosure of corporate shareholders in some form. 4. Just as in Greece, taxes are optional for the nation's financial Elites. In Greece, you don't mention your swimming pool to avoid the "swimming pool tax." Here in the U.S., that sort of tax avoidance is against the law (smirk). Here, you hire a Panzer division of sharp tax attorneys and escape taxation legally (well, mostly legally--whatever it takes to win). If you are unfortunate enough to be a successful small entrepreneur who nets $100,000 a year, you pay 15.3% self-employment and 25% Federal tax on the bulk of your income, a combined rate of 40.3%, and a combined rate of 43.3% on all income above $82,400. Those who net millions pay less than half that amount, somewhere between 17% for the top 1/10th of 1% and 21% for the top 1%: Citizens for Tax Justice, which looks at all taxes paid including federal, state and local taxes, said that in 2010 the top 1 percent of earners will pay 21.5 percent of taxes. Note that the 21.5% paid by the top 1% includes all state and local taxes. Here in California, the small businessperson earning $100,000 pays between 5% and 9% state tax, so their combined state and Federal tax burden on their highest earnings is a whopping 50%. Then there are property taxes and the 9.5% sales tax, and endless junk fees skimmed from small business. Add all that together and the total taxes paid rises to the 60% level, or roughly triple what the top 1% pay. (Bitter note from a tax donkey: To all those tax-and-spenders who whine that California has "low taxes," please pay my "low" property tax bill, will you? It's "only" $11,000 a year.) Super Rich See Federal Taxes Drop Dramatically: The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992. Eric Schoenberg says to sign him up for paying higher taxes. Schoenberg, who inherited money and has a healthy portfolio from his days as an investment banker, has joined a group of other wealthy Americans called United for a Fair Economy. Their goal: Raise taxes on rich people like themselves. Schoenberg, who now teaches a business class at Columbia University, said his income is usually "north of half a million a year." But 2009 was a bad year for investments, so his income dropped to a little over $200,000. His federal income tax bill was a little more than $2,000. "I simply point out to people, 'Do you think this is reasonable, that somebody in my circumstances should only be paying 1 percent of their income in tax?'" Schoenberg said. Do you really think you don't live in a kleptocracy? Why? Because the truth hurts? Readers forum: DailyJava.net. Order Survival+: Structuring Prosperity for Yourself and the Nation (free bits) (Mobi ebook) (Kindle) or Survival+ The Primer (Kindle) or Weblogs & New Media: Marketing in Crisis (free bits) (Kindle) or from your local bookseller. Of Two Minds Kindle edition: Of Two Minds blog-Kindle Thank you, Alberto R. ($20), for yet another superbly generous contribution to this site -- I am greatly honored by your ongoing support and readership.   Thank you, James S. ($5/mo), for your extremely generous subscription to this site-- I am greatly honored by your support and readership. Go to my main site at www.oftwominds.com/blog.html for the full posts and archives. Read more posts on Of Two Minds » Please follow Money Game on Twitter and Facebook. Join the conversation about this story » See Also: What "Toy Story" Can Teach Us About The Economy That "Cars" Can't More Developments That Will Undermine The Euro How Greece Could Start A Domino Effect         Obama Immediately Singles Out Hedge Funders And Corporate Jet Owners For Paying Too Little In Taxes June 29, 2011 at 11:52 AM   Right now, President Obama is making a speech about how to deal with the debt and deficit problems. He emphasized that tax cuts have to be on the table in order to curb debt, in addition to spending cuts. I'm not asking for middle class Americans to relinquish tax cuts, Obama said. He just wants tax breaks to no longer be extended to millionaires and billionaires. And he singled out hedge funders in the group of "millionaires and billionaires" who should not be getting tax breaks. Not bankers, just hedge fund managers. "I don't think it's real radical" to ask corporate jet owners and millionaires to pay higher taxes, Obama said. During question time, Obama continued to emphasize that wealthy hedge fund managers should not be the recipients of tax breaks. "You can't reduce debt levels without... increasing revenue in some way," Obama said. "That revenue is coming out of folks who are doing extraordinarily well, and enjoying the lowest tax rates since before I was born. If you are a wealthy CEO or hedge fund manager in America right now, your taxes are lower than they have ever been." Perhaps we missed it, but we did not here the word "banker" once. It seems like a deliberate attempt to leave banks out of the attack, and instead hone in on asset managers. Please follow Clusterstock on Twitter and Facebook. Join the conversation about this story » See Also: This Is What Obama Said To Wall Street Donors At The $35,800 Per Head Dinner In New York Here's What Happened At That Big Dinner With Obama And The Hedge Funders Check Out The Mouthwatering Food That Obama Feasted On With Hedge Funders Last Night         Obama Immediately Singles Hedge Funders And Corporate Jet Owners For Paying Too Little In Taxes June 29, 2011 at 11:52 AM   President Obama is making a speech about how to deal with th edebt and deficit problems. He emphasized that tax cuts have to be on the table in order to curb debt, in addition to spending. I'm not asking for middle class Americans to relinquish tax cuts, Obama said. He wants tax cuts to no longer be extended to millionaires and billionaires. And he singled out hedge funders in the group of "millionaires and billionaires" who should be exempt from tax cuts. Not bankers, just hedge fund managers. "I don't think it's real radical" to ask corporate jet owners and millionaires to pay higher taxes, Obama said. Please follow Clusterstock on Twitter and Facebook. Join the conversation about this story » See Also: This Is What Obama Said To Wall Street Donors At The $35,800 Per Head Dinner In New York Here's What Happened At That Big Dinner With Obama And The Hedge Funders Check Out The Mouthwatering Food That Obama Feasted On With Hedge Funders Last Night         Why The Browser Matters June 29, 2011 at 11:50 AM   Before my partner Marc Andreessen and his friends at the University of Illinois invented the browser in 1993, most people thought only scientists and researchers would use the Internet. The Internet was thought to be too arcane, insecure and slow to meet real business needs. Even after the team introduced Mosaic, the world’s first browser, almost nobody thought the Internet would be significant beyond the scientific community­—least of all the most important technology industry leaders who were busy building proprietary alternatives. In fact, you’d be hard pressed to find much written arguing that the Internet would be meaningful in those days. The overwhelming favorites to dominate the race to become the Information Super Highway were competing proprietary technologies from industry powerhouses such as Oracle and Microsoft, which captured the imagination of the business press. This was not so illogical as most companies didn’t even run TCP/IP—they ran proprietary networking protocols such as AppleTalk, Netbios, and SNA. As late as November 1995, Bill Gates wrote a book entitled The Road Ahead in which he predicted that the Information Super Highway would rule the future. In the first edition, The Information Super Highway was to be the logical successor to the Internet, but definitely not using Internet technology. Gates later went back and changed the references from the Information Super Highway to the Internet, but that was not his original vision. The implications of the propriety vision were not good. In Gates and Ellison’s minds, the corporations who owned the Information Super Highway would tax every transaction by charging a “vigorish” as Microsoft’s then Chief Technology Officer Nathan Myhrvold referred to it at the time. It’s difficult to overstate the momentum that the proprietary Information Super Highway carried. After Mosaic, even Marc and his co-founder Jim Clark originally planned a business for video distribution to run on top of the proprietary Information Super Highway, not the Internet. It wasn’t until deep into the planning process that they decided that by improving the browser by making it secure, more functional and easier to use, they could make the Internet the network of the future. Marc and Jim called the first Netscape browser Mozilla—meaning Mosaic Killer—to emphasize the mission to replace Mosaic and its importance. Today, if you type about:Mozilla into a Firefox browser (the Netscape derivative browser project), you still see the religious zealotry with which the team pursued the mission. On the modern Internet, we all benefit from that passion and commitment. Had Netscape not succeeded so quickly and forced Microsoft into the browser war and out of their proprietary network agenda, the world likely would be quite different.  Even if the Internet had eventually won, it would have taken much longer and the world would have lost years of important innovation. And we all would have paid many vigorishes in the meanwhile. After AOL acquired Netscape in 1999, the browser wars ended and browser innovation stopped for many years. Then more recently, projects like Firefox from Mozilla.org and Chrome from Google made major advances in the “under the hood” technology. It’s a testament to the fundamental importance of the browser that these invisible, but meaningful changes created major market share shifts. In the past 3 years an eye popping 500 million people have switched browsers. Still, since 1996, the only major change to the browser’s user experience has been the addition of tabs. A truly stunning lack of innovation when you think about the underlying changes on the Internet. In 1996, there was no social networking, no video, no search that worked, no RSS, and no Twitter to name a few. It’s amazing to think that none of these advances led to any corresponding browser change. Rockmelt and the next wave of innovation All that began to change two years ago when Tim Howes and Eric Vishria founded Rockmelt, a company with a mission to reinvent the browser’s user experience. In order to adapt the browser to the last 15 years of Internet evolution, Rockmelt focuses on four major changes: People—Perhaps the most important change in the past five years has been the shift from a page-centric to people-centric Internet. In response, Rockmelt builds the concept of friends right into the browser making people first class citizens from a technological perspective. Information Flow—The modern web reverses the paradigm of getting information as information now flows to us. Rockmelt integrates this concept by making streams and feeds a basic part of the user interface. Search—Back in 1996 during the time of the last browser UI innovations, searching the Internet was very different. In fact, the search products of the day didn’t work very well, so people didn’t use them very much. Google changed that in the early 2000s with their breakthrough product and company. Now, more than a decade later, Rockmelt changes the browser to take advantage of modern search. Multiple Computing Devices—In the days of Mosaic and Netscape, a person was lucky to own one computer. As a result, the original browsers were all device specific. Your bookmarks, browsing history, configuration, etc. all stayed with the one device you owned. Now we have computers at home, at work, and in our pockets and the one device paradigm doesn’t work so well. With Rockmelt, the browser information lives in the cloud rather than on a device. As a result, things work the way modern people expect them to. Rockmelt’s engagement numbers through their beta period seem to confirm their thesis: Over 6 hours of use per person per day Average of 3 chat conversations per user through RockMelt each day 60% of users 35 and under are active chatters, and they each send an average of 65 messages every day and 71% of the youngest cohort use chat. Average of 20 uses of the information flow features per person per day 80% of searches go through the browser’s search interface rather than a search site 56% of users are age 24 and under, 80% under 35. A very special group of people drove the original browser innovations and the Rockmelt team follows that tradition. Rockmelt’s CTO Tim Howes began his Internet career by inventing the Lightweight Directory Access Protocol (LDAP) with his colleagues at the University of Michigan. LDAP complemented and then ultimately replaced the previous standard, DAP (Directory Access Protocol), by simplifying, modernizing, and just plain fixing the old guard. Now Tim aims to do the same thing with the browser. His co-founder, Eric, was the best young executive that we had at Opsware and is building Rockmelt into a great company and a great place to work. It’s incredibly exciting to see them pick up where history left off. Pouring out a little liquor for the Ultimate Browser Warrior We all live in a better world today thanks to the efforts of those who fought the original browser wars. Technology history records many of them: Marc Andreessen, Bill Gates, Steve Ballmer, Jim Barksdale to name a few, but people who were there will tell you there was none more important or impactful than the late great Mike Homer. In fact, to a large extent Mike created the war by launching a withering PR attack that Microsoft couldn’t ignore. During that period, several times a quarter Mike would assemble an entire marketing campaign or product strategy in his sleep. Or maybe he didn’t sleep, but he would definitely think them up between 3 and 5 am. Out of those middle-of-the-night monologue brainstorming sessions emerged some of the greatest marketing ideas that I have ever seen. On one such night, he developed something called the Netscape Now one button download. At the time, software was considered extremely valuable and nobody was allowed to download it without going through a complex registration process. Mike took the conventional 15 steps and collapsed them into one. A concept so brilliant that it has been copied so often that everyone forgets that nobody did it until Mike invented it. Even better than Mike the Ultimate Browser Warrior was Mike the person. In 1995, I was becoming an important voice at Netscape, but I still didn’t have much money, so I continued to drive the car that I could afford: a 1984 Oldsmobile two toned tan and cream—ice cream paint job—Cutlass Supreme that my father helped me to purchase a decade prior for $4,500. I tried to park the car in the back where nobody would see it, so as not to diminish my standing among my peers. One day Mike heard about the Cutlass. He said, “Ben I want a ride in your car.” My heart nearly stopped. I was trying to establish myself as an important contributor and the last thing that I needed was an executive who drove a car worth hundreds of thousands of dollars riding in my car, which was worth hundreds of dollars. When I showed up for the date, I was horrified to see that Mike brought our CFO, Peter Currie with him. I sat in my car with our CFO next to me, the most important executive in the company sitting in my back seat, and I was sweating bullets. Then Mike said: “Ben, I’ve named many products in my career, but I believe that I have just come up with the most appropriate name for a product in history. I am naming your car ‘La Bamba.’” And then he laughed that Mike Homer laugh that let me know that it was OK and he’d set the whole episode up to let me know that I was OK too. That small moment changed me from a guy trying to fit in to a true member of the team and meant the world to me. It’s been over two years since Mike passed away from Creutzfeldt-Jakob disease, but I still miss him like it was yesterday.  Heaven or Hell wherever he be that’s where I hope I’m a go. Read more posts on Ben's Blog » Please follow SAI on Twitter and Facebook. Join the conversation about this story » See Also: Lulzsec May Have Called It Quits But The Internet War Is Far From Over Media Files why-the-browser-matters.jpg (JPEG Image)         When Is a Business Plan Not a Business Plan? June 29, 2011 at 11:45 AM   Tweet This has been bugging me for a long time now: It turns out that the phrase "business plan" is a homonym, exactly as in these examples from yourdictionary.com: Just like the different meanings for crane and date, there are at least two completely different meanings for the two-word phrase "business plan:" Business plan: what's supposed to happen in a business. This normally includes priorities, strategy, assumptions, milestones, responsibilities, sales forecast, expense budget, and cash flow. Business plan: a document used to summarize a business to serve as part of the process of seeking investors or applying for a commercial loan. Why does this matter? Because I see both of these two distinct meanings coming up in business conversation all the time, constantly confusing people. For example, when successful entrepreneurs tell pollsters they didn’t have a business plan when they started, they’re using definition #2 here. When smart business advisors play down the use of the business plan, they are also talking about that second definition, not the first. I’ve been starting to distinguish the two meanings in my own work by writing about “business planning” for business plan definition #1, and “business plan document” for business plan definition #2. That first-definition business plan is about optimizing management. It includes regular plan vs. actual review, course corrections, and managing rapid change. It doesn’t assume that there’s virtue in sticking to a plan for no other reason. It lives on your computer. The slide deck, the pitch, and the document are output of that plan. It’s Plan-As-You-Go business planning. The second-definition business plan is something like sales collateral; it’s business goal is communicating a deal to investors, or supporting a loan application. It’s important to a subset of businesses that are seeking investment or commercial loans. I see a lot of those in my work as a member of an angel investment group and a frequent judge at business plan contests. These are very different things, these two definitions of business plan. They are homonyms. And that confuses business discussions about business plans and business planning. Do you agree? Share and Enjoy: Read more posts on Palo Alto Software » Please follow War Room on Twitter and Facebook. Join the conversation about this story »             This email was sent to venturescitechcapital@gmail.com. Delivered by Feed My Inbox PO Box 682532 Franklin, TN 37068 Account Login Unsubscribe Here