Investment/Trends

The Danger of an All-Powerful Federal Reserve

"How will home builders react if the Fed decides their investments are bubbly and restricts their credit? How will bankers who followed all the rules feel when the Fed decrees their actions a 'systemic' threat? How will financial entrepreneurs in the shadow banking system, peer-to-peer lending innovators, etc., feel when the Fed quashes their efforts to compete with banks? Will not all of these people call their lobbyists, congressmen and administration contacts, and demand change? Will not people who profit from Fed interventions do the same? Willy-nilly financial dirigisme will inevitably lead to politicization, cronyism, a sclerotic, uncompetitive financial system and political oversight." Continue reading →

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U.S. tech sector feels pain from NSA PRISM revelations

"An industry group, the Cloud Security Alliance said last month that 10 percent of its non-US members have cancelled a contract with a US-based cloud provider, and 56 percent said they were less likely to use an American company. A separate report this month by the Information Technology & Innovation Foundation, or ITIF, a Washington think tank, said US cloud providers stand to lose $22 billion to $35 billion over the next three years due to revelations about the so-called PRISM program. Daniel Castro, author of the report, says a loss of trust in US tech firms could lead to 'protectionist' measures that hurt the fast-growing cloud sector." Continue reading →

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Passing Over Eisenhower

"Almost all of the major Internet industry giants are based in the United States. The tradition of strong entrepreneurship practiced in the US since their inception, mixed with their purchasing power and history of acquiring any sufficiently profitable venture or fascinating technology from abroad, has put the US into a prime position to be the global leader in provision of Internet services. That may just have ended. While US dominance over the roughly $11 trillion/year global Internet services market is still unchallenged, the damage that the revelations made about NSA’s vast global surveillance scheme may stymie their growth and perhaps even turn them into a localized recession." Continue reading →

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Why NSA Snooping Is Bigger Deal in Germany

"While the U.S. has few laws concerning data privacy, Germany has something unknown to Americans: 17 state data protection supervisors (one national and one for each state), who watch over the compliance of authorities and companies with data privacy laws. After the Snowden revelations, they have discontinued giving out new licenses to companies under the so-called Safe Harbor principles, which are meant to guarantee that personal data is only transferred to countries with sufficient data protection, for example when Germans use American companies’ cloud storage space. The supervisors consider user data in the hands of U.S. companies not safe anymore." Continue reading →

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Snowden leaks: the real take-home

"To Gen X, a job for life with the NSA was a probably-impossible dream — it's what their parents told them to expect, but few of their number achieved. To Gen Y the idea of a job for life is ludicrous and/or impossible. This means the NSA and their fellow swimmers in the acronym soup of the intelligence-industrial complex are increasingly reliant on nomadic contractor employees, and increasingly subject to staff churn. There is an emerging need to security-clear vast numbers of temporary/transient workers ... and workers with no intrinsic sense of loyalty to the organization. Edward Snowden is 30: he was born in 1983. Generation Y started in 1980-82. I think he's a sign of things to come." Continue reading →

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Can Bitcoin make a good first impression with top federal agencies?

"The discussions are to involve many of the country’s top law enforcement and financial agencies, including the FBI, the Secret Service, the IRS, the Drug Enforcement Administration and the Department of Homeland Security. Also attending will be officials from the Justice Department, the Securities and Exchange Commission, National Credit Union Administration, Money Transmitter Regulators Association and the Conference of State Bank Supervisors would also be in attendance, a Treasury official confirmed. Congress has also asked the Obama administration for information on its plans for regulating digital currencies." Continue reading →

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Snapchat market value hits $800 million

"The startup behind a Snapchat application for sharing self-destructing smartphone photos and messages got a dizzying valuation on Monday in a new funding round. Reports that the company launched in late 2011 had raised $60 million from investors hit the Internet along with word that people are sharing more than 200 million ‘snaps’ daily. The startup said that it has been operating on a tight budget and will use the infusion of cash from investors to beef up its engineering team and server capacity. Snapchat has stirred controversy for its potential to be used to share risque pictures that are automatically deleted, like any ‘snaps,’ within ten seconds of receipt." Continue reading →

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Life in a Toxic Country

"I recently found myself hauling a bag filled with 12 boxes of milk powder and a cardboard container with two sets of air filters through San Francisco International Airport. I was heading to my home in Beijing at the end of a work trip, bringing back what have become two of the most sought-after items among parents here, and which were desperately needed in my own household. China is the world’s second largest economy, but the enormous costs of its growth are becoming apparent. Residents of its boom cities and a growing number of rural regions question the safety of the air they breathe, the water they drink and the food they eat." Continue reading →

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Bhutan banks on ‘white gold’ hydropower

"Home to meditating monks and Himalayan nomads, the sleepy kingdom of Bhutan has set its sights on becoming an unlikely energy powerhouse thanks to its abundant winding rivers. Hydropower plants have already harnessed the country’s water flows to light up nearly every Bhutanese home, generating electricity that is sent to remote villages by cables strung through rugged mountain terrain. It is a rapid transformation for the long isolated nation, where less than a quarter of households had electricity in 1999 — the same year Bhutan became the last country to introduce television." Continue reading →

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Oil and gas drillers use complex schemes to stiff retired landowners for royalties

"From Pennsylvania to North Dakota, a powerful argument for allowing extensive new drilling has been that royalty payments would enrich local landowners, lifting the economies of heartland and rural America. The boom was also supposed to fill the government’s coffers, since roughly 30 percent of the nation’s drilling takes place on federal land. Over the last decade, an untold number of leases were signed, and hundreds of thousands of wells have been sunk into new energy deposits across the country. But manipulation of costs and other data by oil companies is keeping billions of dollars in royalties out of the hands of private and government landholders." Continue reading →

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