The Big Picture - Macro Perspective on the Capital Markets, Economy, Technology, and Digital Media

>

I did a quick hit for Fast Money tonight.

You can see it here

>

click for video

on Monday, November 29, 2010

I have no idea if this is true — the speculation that it is BofA comes via Raw Story — but the most likely banks are the big ones BofA, Citi, JPM, and Wells Fargo.

Here is the sad reality: Can you really embarrass any of these banks? They were incompetently run, with criminally inept risk management. They blew themselves up, and exist today only due to the largesse of the taxpayer. They gratefully took all they could grab and more.

What else can you release to embarrass them?

Unless they have 5GB of video showing their CEOs engaging in bestiality, its hard to imagine Wikileaks embarrassing the big banks.

Excerpt:

In an interview published Monday, Wikileaks founder Julian Assange revealed that his whistleblower website intends to publish a trove of secret documents exposing the corruption of a major American bank.

He declined to say which bank, but he offered what may be a telling hint last year as to who the megaleak will target.

“At the moment, for example, we are sitting on 5GB from Bank of America, one of the executive’s hard drives,” Assange told the technology site Computer World in an article published on October 9, 2009.

The Wikileaks chief continued: “Now how do we present that? It’s a difficult problem. We could just dump it all into one giant Zip file, but we know for a fact that has limited impact. To have impact, it needs to be easy for people to dive in and search it and get something out of it.”

The Internet has been abuzz with speculations as to which bank the famous — or notorious — website will expose. Although Assange’s hint is far from a dead giveaway, his strategic approach to publishing secrets suggests that his next target may well be Bank of America, the nation’s largest bank in terms of assets.

See also the Forbes interview with Wikileaks founder Julian Assange.

This just in: Econometric models bear little relation to reality !
(Also, JFK was shot)

>
click for larger infographic

>

Source:
Economists’ Grail: A Post-Crash Model
MARK WHITEHOUSE
WSJ, NOVEMBER 30, 2010
http://online.wsj.com/article/SB10001424052702303891804575576523458637864.html

From the NYT, these electron microscopy photos are strangely beautiful:

The last few decades have produced an explosion of new techniques for probing the blobby, unprepossessing brain in search of the thinking, feeling, suffering, scheming mind. But the field remains technologically complicated, out of reach for the average nonscientist, and still defined by research so basic that the human connection, the usual “hook” by which abstruse science captures general interest, is often missing.

Carl Schoonover took this all as a challenge. Mr. Schoonover, 27, is midway through a Ph.D. program in neuroscience at Columbia, and thought he would try to find a different hook. He decided to draw the general reader into his subject with the sheer beauty of its images.

So he has compiled them into a glossy new art book. “Portraits of the Mind: Visualizing the Brain From Antiquity to the 21st Century,” newly published by Abrams, includes short essays by prominent neuroscientists and long captions by Mr. Schoonover — but its words take second place to the gorgeous imagery, from the first delicate depictions of neurons sketched in prim Victorian black and white to the giant Technicolor splashes the same structures make across 21st-century LED screens.

Scientists are routinely seduced by beauty. Mr. Schoonover knows this firsthand, as he acknowledged in an interview: for a while his wallet held snapshots not of friends or family, but of particularly attractive neurons. Sometimes the aesthetics of the image itself captivate. Sometimes the thrill is the magic of a dead-on fabulous technique for getting at elusive data.

Particularly attractive neurons:

Cerebellar Purkinje neurons

Spiny neuron

Chick retina

Rabies

Subnetwork

Cerebellum

Neocortex

>

Source:
Slide Show <br>http://www.nytimes.com/slideshow/2010/11/29/science/20101130-brain.html

Odyssey Through the Brain
ABIGAIL ZUGER, M.D.
NYT, November 29, 2010
http://www.nytimes.com/2010/11/30/science/30brain.html

Nov Consumer Confidence was slightly better than expected at 54.1 vs the forecast of 53 and is up from 49.9 in Oct. It’s the best since June. The gain was mostly led by the Expectations component which rose to the highest since May rising 6.7 pts while the Present Situation was up just .5 pt. The answer’s to the labor market questions were mixed as those that said they were Plentiful rose .5 pt to a 3 month high but those that said jobs were Hard to Get rose to the highest since Feb. The difference was those that said jobs were Not So Plentiful which fell to the lowest since Feb. Those that said Business Conditions were Good fell and those that said they were Bad rose, both slightly but 6 mo’s hence pointed to better conditions. Disconcertingly, those that plan to buy a home within 6 months fell, matching the lowest since 1982. Those that plan to buy a car though rose to a 6 mo high. One yr inflation expectations were 5.1%, the highest since May.

The Nov Chicago PMI was 62.5, above expectations of 59.9, up from 60.6 and the best since April. It follows the better than expected Philly, Richmond and Dallas manufacturing surveys and the lone standout on the downside, the NY survey. The ISM tomorrow will reconcile all the regional data. New Orders rose 2.2 pts to 67.2, the highest since May ’07 but Backlogs fell a touch to 48.9. Production, which follows orders, rose to the most since early ’05. Inventories fell back below 50, falling 6.5 pts to 48.4. Employment rose 1.7 pts to 56.3, a 4 month high. Reflecting the rise in commodity prices, the Prices Paid index rose almost 2 pts to 70.7, the highest since April. Bottom line, the # was a definite positive but the manufacturing crystal ball becomes cloudy over the next 6 mo’s as the inventory build story is played out, Europe is weighed down by its own issues and Asia fights inflation with rate hikes. US end demand will also be key.

S&P/CS said their 20 city home price index fell by .8% m/o/m in Sept, twice expectations. The y/o/y gain was .6% vs the forecast of a rise of 1.0%. The overall index did fall to a 4 month low and is now 5.9% off the recent low in Apr ’09 but remains 29% below the high in July ’06. On a y/o/y basis, 5 of the 20 cities saw gains, of which were San Francisco, San Diego, Washington DC, LA and Boston while the declines were led by Chicago, Tampa, Charlotte, Portland and Las Vegas. Bottom line, soft housing market data is not a surprise to any of us but there is a debate of whether housing prices are in the bottoming process or whether we’re in a lull before the next leg down. With the inevitable foreclosure process soon getting underway more in earnest after the recent slowdown, assuming paper work and bank issues get resolved soon, we’ll likely see another increase in inventories and thus softer prices in the aggregate.

Oooh, this failed to launch (now I am having differently trouble, apparently, getting it posts up)

Case-Shiller1 Home Price Indices continue to decline, falling 2.0% in Q3. (Q2 saw a tax rebate driven rise of 4.7%).

For data through September 2010, home prices are 1.5% below their year-earlier levels nationally. In September, 18 of the 20 MSAs covered by S&P/Case-Shiller Home Price Indices and both monthly composites were down; and only the two composites and five MSAs showed year-over-year gains. While housing prices are still above their spring 2009 lows, the end of the tax incentives and still active foreclosures appear to be weighing down the market. Of course, none of this comes as a surprise to anyone.

As the chart below shows, home prices have fallen back to 2003 levels:

>
click for larger charts

>

Additional charts after the jump

Read the rest of this entry »

Josh Brown has a hilarious infographic on the differences between Research and Insider Trading:

>

click for larger graphic

Bob Lefsetz is a music industry observer, and publisher of the Lefsetz letter:

~~~

If one function devices could continue to triumph, the iPod would not be supplanted by the iPhone.

A friend just asked me if I was on BBM.  That’s BlackBerry Messenger for the uninitiated.  And many may never be initiated, because BlackBerry is so 2001.  Or 5.  Or maybe even 6 or 7, but certainly not 11.

BlackBerries do one thing incredibly well, process e-mail.

And that’s it.

If you think BlackBerries surf the Web well, then you don’t, or have never used an iPhone.

Sure, RIM sells a touch screen BlackBerry, but that’s like the Beach Boys doing disco music, or Elton John rapping.  The Beach Boys actually tried that.  Didn’t work too well.  If you’re a musical act, you can’t follow trends, you’ve got to be you.  But in both tech and music, you only survive if you’re ahead of the curve, and not if you’re behind.

It’s all about software.  And software can have no glitches.  The reason Apple is triumphing is because their gear just works.  Sure, it looks cool. But that’s just icing on the cake.  People didn’t buy all those Toyotas because they looked cool, but because they didn’t break.

It’s utterly fascinating watching the tech landscape.  It’s truly either innovate or die.  Once upon a time, I’d pay extra and buy Sony with almost no research.  Now Samsung makes a better television and Microsoft makes a better motion detection gaming system.  I can’t even remember the name of Sony’s wii-style competitor, but everybody’s testifying about Kinect.

You’ve got to read David Pogue’s 10th anniversary tech column in the “New York Times”:

The Lessons of 10 Years of Talking Tech

He talks about the littered landscape of deceased items but also states that he too is overwhelmed, with the sheer plethora of tech products.

Just like we’re overwhelmed with the sheer quantity of music.

But make a great tune and it lasts forever.

A mediocre, trend-following track may be a hit today, but it’s as useless in the future as a Motorola StarTac.

I know, I know, you’re Canadian, you beat your chest for RIM.

But it’s over.

Because RIM looked for a day it could dominate, but once it reached that peak…nothing.

Google’s making inroads in the mobile world because of Android software.  Doesn’t matter the handset, they all work well enough.

Sure, iPhones work better, but Apple is proving you don’t have to dominate to be profitable.  Look at their Mac sales.  And whatever dominance they had in MP3 players is about to become irrelevant, as a result of not only smartphones, but on demand streaming.  Isn’t it interesting that the best-selling iPod is the Touch, which is basically the iPhone without the phone (but it does have FaceTime!)

It’s confusing.  Just when you get up to speed in one area, time passes and you’re passe.  You can stay where you are, in the backwater, but please don’t try and tell everybody else to live in your ancient village.  This has decimated the major labels and is now impacting newspapers and movies and…  It’s tough to be dominant in the old world but start over in the new.  But that’s what you’ve got to do.  The only way to triumph these days is by being cutting edge.  There’s no way you can corral people into living in the past.

I’ve probably bought my last BlackBerry.  I’ve got app-envy.  There are whole issues of “Macworld” and “MacLife” that don’t apply to me.  Media is fascinated with apps, and I’m left out.  I’m not a shopper, but all I read about are apps that help you navigate Black Friday sales.

RIM is a one hit wonder.  That is now chasing trends, poorly.

This doesn’t work in music and it doesn’t work in tech.

Feedback and comments after the jump

Read the rest of this entry »