Tue, Feb 26 2008
NEXT WEEKS NEWS TODAY
Diebold Accidentally Leaks Results Of 2008 Election Early
Tue, Feb 26 2008
LET'S ALL JUST PHONE IN THE NEXT WAR
Killer robots pose latest militant threat: expert
LONDON (Reuters) - Killer robots could become the weapon of choice for militants, a British expert said on Wednesday.
Noel Sharkey, professor of artificial intelligence and robotics at the University of Sheffield said he believed falling costs would soon make robots a realistic option for extremist groups.
Several countries and companies are developing the technology for robot weapons, with the U.S. Department of Defense leading the way. More than 4,000 robots are deployed in Iraq.
"The trouble is that we can't really put the genie back in the bottle. Once the new weapons are out there, they will be fairly easy to copy," Sharkey will tell a one-day conference organized by Britain's Royal United Services Institute on Wednesday.
"How long is it going to be before the terrorists get in on the act? With the current prices of robot construction falling dramatically and the availability of ready-made components for the amateur market, it wouldn't require a lot of skill to make autonomous robot weapons."
Sharkey said a small GPS-guided drone with autopilot could be made for about 250 pounds ($490).
Tue, Feb 26 2008
MOGAMBO SUMS IT UP NICELY
The incomparable Mogambo Guru:
"The interesting thing is that Treasury Gross Public Debt is now $9.244 trillion, up from $5.65 trillion in the middle of 2001, when the current government-borrowing binge started going bananas, suddenly rising at a steady $50 billion per month or so.
And for a little perspective, that $3.594 trillion in additional debt means that, at even 5% interest, the government is now paying out $180 billion a year, just in the additional interest payments on just this additional debt, which is more than the entire total of the "economic stimulus" checks that are going to be mailed out! This is insane! And scary as hell!
So, let's summarize. The banks are battered by their massive subprime liabilities. Housing is in the tank. Manufacturing is down. Food and energy are up. Unemployment is rising. And consumer spending has shriveled to the size of an acorn. All that's missing is a trumpet blast and the arrival of the Four Horseman."Tue, Feb 26 2008
DOWNWARD SPIRAL PICKING UP SPEED
"We're in a slowdown,' sez WhiteHouse spokeschick Dana Perino. No shit, spritzhead. Mighty white of y'all to finally acknowledge it, not that you have much choice anymore.
Worries grow for worse 'stagflation'
WASHINGTON, Associated Press - It's a toxic economic mix the nation hasn't seen in three decades: Prices are speeding upward at the fastest pace in a quarter century, even as the economy loses steam.
Economists call the disease "stagflation," and they're worried it might be coming back.
Already, paychecks aren't stretching as far, and jobs are harder to find, threatening to set off a vicious cycle that could make things even worse.
The economy nearly stalled in the final three months of last year and probably is barely growing or even shrinking now. That's the "stagnation" part of the ailment. Typically, that slowdown should slow inflation as well — the second part of the diagnosis — but prices are still marching higher.
The latest worrisome news came Tuesday: a government report showing wholesale prices climbed 7.4 percent in the past year. That was the biggest annual leap since 1981.
"We're in a slowdown," Press Secretary Dana Perino said at the White House, where the economics talk was still upbeat until recently.
Once the twin evils of stagflation take hold, it can be hard to break the grip. People cut back on their spending as they are stung by rising prices and shriveling wages. Businesses, also socked by rising costs and declining demand from customers, clamp down on their hiring and capital investment.
That would be a nightmare scenario for Wall Street investors, businesses, politicians and most everyone else. They're already looking to the Federal Reserve for help, but the Fed's job is complicated by the situation.
The mission of Federal Reserve Chairman Ben Bernanke and his colleagues is to nurture economic growth and keep inflation under control. To brace the teetering economy, the Fed since September has been ratcheting down its key interest rate. Another cut is expected in March. However, to combat inflation, the Fed would be expected to boost rates instead.
"The Fed has its hands full. It is preoccupied with the economic slowdown at the front door, but inflation looks to be sneaking in the back door," said Greg McBride, senior financial analyst at Bankrate.com. "If that trend continues, the Fed would need to show the economy some tough love, meaning higher interest rates to keep inflation from getting out of hand."
On the other hand, Brian Bethune, economist at Global Insight, said Bernanke can fight only one war at a time, and the more pressing issue right now is to shore up the ailing economy. "That's the war that needs to be fought. The war on inflation will have to come another day," Bethune said.
Maybe things won't be so bad. Stock prices rose for the day, continuing a recent mini-rally. The Dow Jones industrials closed up 114.70 points. And Federal Reserve vice chairman Donald Kohn said in a speech that he doesn't expect the recent elevated inflation readings to persist.
"But the recent information on prices underlines the need to continue to monitor the inflation situation very carefully," he added.
Some numbers underscore the concerns:
• Prices paid by consumers were up 4.1 percent last year, the biggest increase in 17 years. Those higher prices — especially for heating homes and filling up gas tanks — are taking an ever-bigger bite out of paychecks. Workers' weekly earnings are down 1.4 percent from January a year ago when adjusted for inflation.
• Oil prices galloped past $100 a barrel to close at a record $100.88 on Tuesday. Those lofty energy prices are a double-edged sword: They can spread inflation through the economy by boosting the prices of lots of other goods and services, and they can leave people with less money to spend on other things, thus slowing overall economic activity. There are signs high energy prices are causing some damage on both of those fronts.
People are hunkering down. Earlier this month, nervous shoppers handed the nation's retailers their worst January in almost four decades. High gas and food prices, the toll of the housing bust, the credit crunch and a tougher job market all were to blame. Disappointing sales were widespread, hitting discounters like Wal-Mart Stores Inc. and upscale merchants like Nordstrom Inc.
Wary employers eliminated jobs in January, the first nationwide loss of jobs in more than four years.
With the economy on the edge of a recession — if it hasn't toppled over already — the Fed for the near term is much more likely to keep lowering rates. Yet, with its own forecast revised last week to show even slower growth this year as well as higher inflation and higher unemployment than previously anticipated, Bernanke and his colleagues have made clear they'll need to stay nimble.
Can a serious bout of stagflation be avoided? Many economists believe the Fed's aggressive rate cuts along with tax rebates for people and tax breaks for businesses will lift the economy in the second half of the year.
Until then, analysts warn that it could feel like the country is suffering through a mild case of stagflation_ even if technically that is not the case. "It could feel like a bad flu," said Bethune.
In the past stagflation episode in the 1970s and early 1980s, inflation sometimes hit double digits — much higher than the current rate. And unemployment was higher, too. In 1975, for instance, the jobless rate zoomed to 8.5 percent, the highest since the early 1940s. Last year, by contrast, the jobless rate averaged 4.6 percent.
"In the real economy, activity looks slow but not disastrous," Alice Rivlin, former vice chair of the Federal Reserve, told Congress Tuesday. But she added: "Uncertainty remains great. ... The risks are mainly on the downside and gloomier forecasts are not hard to find."Tue, Feb 26 2008
INFLATION ACTUALLY RUNNING AT 11.8%
We all know the numbers coming out of the goobermint are bullshit. Monty Guild breaks it down:
THE UNITED STATES ANNOUNCED A 2.1% INFLATION RATE.
IN REALITY IT WAS MUCH HIGHER.
As measured by the Consumer Price Index or CPI, the Bureau of Labor Statistics places the rate of inflation at 4.3% and the core CPI at 2.1%. This is simply inaccurate. The fact that this figure is so out of touch with the reality on the ground begs several questions.
First, why do government statisticians and economists still refer the core CPI? Effectively stripping out the food and energy components? Core CPI, no longer reverts back to the basic CPI range as it once did. This is due to the fact that rises in food and energy prices are no longer the one-time cyclical events that they may have been decades ago. Today, they are long-term secular events and even the Federal Reserve officials have pointed this out. This alone makes the use of the core CPI outmoded and possibly devious.
Further, anyone familiar with the statistics behind CPI construction knows that since the 1980’s statistical techniques have been used to understate the CPI and other government inflation statistics.
The manipulation of the basket of goods within the CPI over the past two decades has generally had the effect of reducing inflation. For example, a number of years ago the cost of a home was removed from the basket and rents were substituted. The effect of this was to grossly understate the CPI for the last several years as housing prices have been booming. Further, even with the current decline in housing prices, rents remain much cheaper than house payments.
Another technique to mask inflationary pressures was the discontinuation of the publication of the M3 measure of the money supply in March 2006. It was discontinued after many economists began to believe that it gave a clearer insight into the rate of growth of money in circulation. This was important because many economists believe that the rate of growth of the money supply influences the inflation rate.
THE SEARCH FOR ACCURATE CPI DATA
Fortunately, some economists make a living by monitoring the discontinued statistics and making them available to others for a fee.
One such organization is shadowstats.com. The proprietor John Williams and his team monitor much of the important data that is “adjusted” or discontinued. According to them, CPI growth for the last 12 months would have been 7.6%, if the gimmicks introduced since 1990 were removed from the calculations. And according to Williams, if the gimmicks introduced since 1980 were removed, the CPI number would have been 11.8% for the last 12 months. This is versus the published 4.3% CPI.
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