Monthly Archives: September 2008

Sept. 29, 2008

Today there was a crowd of people watching the TV screen in the library lobby watching the market panic plummet while the vote failed.

I missed most of the good trades because I had class today.  I traded a little later, made some money on GOOG and AAPL (long and short).

But it’s just really tragic to see the opinions expressed and actions taken today.  How long will it take to put together another deal while world markets crash and credit spreads go even higher?

We’ve dumbed ourselves down so much that we have no hope of getting ourselves out of this mess.

It’s a repeat of 1929.

Good luck to us all.  As for me, there’s lots of liquidity to daytrade this garbage.  But this is nothing like the 2001 bubble burst.

[Addendum:  Found an excellent additional read.  Will piggyback off of it in a post later.]

[Addendum 2: Is Morgan next? And then a massive bank-run collapsing the system? Nouriel Roubini speculates.]

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Filed under Business, Economics, Policy, Stock Market

Walking Surfaces

Today it was rainy in DC and I was walking to the Exorcist steps to do my workout (chin-ups and 5-8 laps up the stairs) when I saw this guy fall flat on his ass on slippery stairs outside.  He was wearing flip-flops, so he had no traction.

I know this feeling well.  Georgetown has a lot of smooth-surfaced brick walkways, so if it’s wet or icy, you will slip on it in any kind of shoe, but particularly in flip-flops or dress shoes.  During the winter, the campus lays out salt, but you still see people fall on their butts constantly.

We spend so much of our days walking.  It seems like someone could make a game-changing company out of an invention that applied traction surfaces to walkways.  Perhaps even making bricks more like rough, uneven concrete, and then giving it a slightly sticky surface to increase walkability.  It would have to be easy to install and easy to replace, since so much damage and maintenance is inflicted upon city streets.

Now that we’re making chemical and mass-produced breakthroughs and are looking creatively at industrial design, we will start to make our world more liveable and more aesthetic.  And more fun.

Here’s a vid of the Exorcist steps:

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Still Waiting on the Bailout Deal

It’s Saturday night and I think the political leaders are currently meeting right now in DC regarding the bailout proposals.  I’m guessing that tomorrow night (Sunday) is the key time to see if any deal will be announced.  I can’t see how it won’t be passed.  I think it would be taken as a major negative for the markets if no deal was made by Monday’s market open.

But I am not sure if this bailout will actually work.  It just might indeed be a literal bailout — just more money pumped (after the billions already injected) into the banks so that they can hoard their cash.  The TED spread, which tracks the spreads between different periods of interest rates, and therefore the cost of borrowing and lending, shows that credit markets are locked.  Credit right now is worse than it was after 9/11.

Meanwhile world markets have been drifting lower but holding up from collapse.  This suggests that people are waiting to see the results of the bailout negotiations.  The locked credit market suggests that the finance sector doesn’t want to lend out money right now and is trying to re-capitalize itself so it can fight off further market selling and takeover attempts.

This means that businesses are not getting capital.  They can’t invest and will have problems doing business with each other.  It’s been like that for about two weeks now.  This should bomb the GDP numbers in the future.

So if we give all this money to banks, will that make everything better?  Will getting the bad mortgages off their books fix things?  Clearly it would help straighten some books, but what’s unclear is what the banks will do with the money they get.  They have to date simply held on to the money and not released it again.  Also, money is being destroyed with deleveraging going on at a massive rate.  This forces the sale of stocks, which has depressed stock prices at the end of the day most days of last week.

Also unclear is whether there will be a reinstatement of previous regulations that did a fairly good job of preventing junk debt speculation.  NYTimes had a great op-ed pointing this out.  Without some vision of what proper regulation will look like, we will fix nothing with this bailout and it will end up sinking us.

There’s really no options left if this bailout saga doesn’t go through…  Though, I’m hoping for a bit more clarity and transparency on how the money will be deployed; sadly I don’t think it will come.  We’ll have to deal with a lot of pain, unemployment, and recession either way, I think.

Chances are that we’ll be on our own as citizens and taxpayers, while kleptocrats continue to raid the government coffers.  On this, Naomi Klein puts the events within the “shock doctrine” model in a recent interview.  And contrary to foreign nations’ beliefs, this will sink the world’s economy too, even if it doesn’t have as much bad debt.

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Filed under Business, Economics, Policy, Stock Market

The Debate on Pakistan

Last night I watched the presidential debate.  Whatever.  But one part that really pissed me off was when Obama and McCain talked about Pakistan (here’s a transcript).

First off, McCain mispronounced or did not know the new Pakistani president’s name, Zardari, as “Kadari”.  While McCain knew a lot of past leaders in the old NATO playground of eastern Europe, his flub on Zardari falls in a long line of flubs by senior American leaders on Muslim names.  As an Arabic linguist, I know that there is only one conclusion:  complete ignorance of Muslim culture.  But I guess we knew that already.

Second, McCain claimed that Pakistan was a failed state before General Musharraf (yes, “General”…) took over.  What a fantastic piece of revisionism.  Pakistan was enjoying a rather democratic period in its history with Nawaz Sharif and Benazir Bhutto, who were not altogether uncorrupt but who are now (after Musharraf’s ouster) still prominent figures of Pakistani democracy.

So what McCain was saying was that Pakistan was a failed state until General Musharraf undertook a coup d’état and would later try to arrest a Supreme Court judge, tease along a dog-like US eager for bin Laden’s head, and try to obtain lifetime rule.

When people criticize the US for speaking about democracy but undertaking and espousing anti-democratic views of other nations, this is what they are referring to!

A last note on McCain.  I can’t confirm this but I’m pretty sure McCain falsely claimed that he traveled to Waziristan.  Waziristan, as you might know, is an area in northwestern Pakistan outside of the government’s control and firmly Talibanized, lawless, and incredibly dangerous not only for any white man but for any foreigners.  I can’t imagine McCain went to Waziristan in any shape or fashion.  If he did, he was part of the greatest covert operation ever, involving a wonderful disguise of his skin color, clothing, linguistic abilities, religious belief, etc.  The only way Americans get into Waziristan is with massive special operations escort.

Obama on the other hand was better, but disappointing.  He wants to send more troops to Afghanistan (and I imagine McCain does too).  Afghanistan will not be contained by American forces, no matter how many we send in.  What is the historical precedent?  What are we going to do there?  Wall off Kandahar and Kabul?

It’s veterans like me who will have to fill the slots to go to war there.  What will we accomplish?  Iraq is a dismal failure, despite McCain’s promises that it’s wildly successful, and it will be even worse in Afghanistan, the home of mujahed legend, where population density is sparse and economic activity is even lower.  That Obama and McCain do not recognize that Waziristan is outside of Pakistani control (read NYTimes’ recent article on the subject), even after very bloody and humiliating attempts by the Pakistani military to contain it, is haunting.  Our politicians are trying to remain “strong” on terror but they have no long-term focus, or even one that takes into account international relations theory.  But then again, even the Pakistani experts are wrong on this issue.

What we should do in fact is withdraw from Iraq and Afghanistan, and during the logistical flight mess, attack Waziristan and FATA.  It might even be worth doing so while troops are still in Iraq and Afghanistan.  We should withdraw funding to Pakistan (and Israel, and Iraq, and…).  My logic is that we know that bin Laden and Zawahiri are in FATA somewhere.  We have set up a large martial law-like apparatus in airports worldwide, which should have been a temporary move instead of a permanent one.

If we were to use our offensive military advantage in FATA, we could disrupt and flush out long-entrenched senior leaders.  They know they are perfectly safe there for now, even while we put clamps down on the rest of the world.  But if they are forced to move, we will generate intelligence and have better leads on them, especially if they attempt to flee to potential future havens like Yemen.

But this must be combined with withdrawal from Iraq and Afghanistan.  This will drain the mujahed solidarity more than you might think.  It’s counter-intuitive.  Yes, they will celebrate another “victory”, but it will not collapse the US like it did the Soviet Union.  I hope.  The financial crisis here at home has made that less clear.

One problem in Pakistan is that it’s a nuclear state.  Destabilizing the government could cause nuclear weapons to get in the hands of Al-Qaeda, which does indeed desire to use nuclear weapons against its enemies.  But wouldn’t its arsenal be fairly centralized and easy to protect?  Couldn’t we (or China, going by that Wiki article above) help to secure those arms and thus have an avenue to cooperate with Pakistan while going into FATA?  I understand the concern on this issue but don’t think it’s a deal-killer.

But they will lose incentive for arms flows (the US is flooding Muslim nations with weapons), ease of access to killing Americans, ease of training and impact evaluation for missions, public support for jihad.  The US can shore up its domestic support, re-tool its military, and stop draining its coffers.  Regionally, neighbors of Afghanistan, Pakistan, and Iraq will have to close their borders.  Up till now, they’ve had a strong incentive to open their borders:  they’ve been able to release their extremists and send them to fight the jihad in other countries, increasing their security by ridding themselves of problem people.  With an outside enemy gone, they will have to return to their pre-Iraq postures.

I believe in sovereignty and self-determinism and all that, but I do believe that we have a very simple mission:  kill bin Laden and Zawahiri.  Even the dumbest soldier understands that mission.  But we have failed for about seven years in this mission.  That is unconscionable.  Critics would say that the mission has changed, or that bin Laden’s death will not end jihad.  No, it will not end the jihad, but killing or capturing key leaders of insurgencies substantially reduces the institutional capacity of an organization.  It is also an incredibly simple metric for governments to pursue.

And to be honest, how politically unpopular would it be to say that we will go balls-to-the-wall to kill bin Laden in his safe haven, regardless of Pakistani “sovereignty”?  They don’t control FATA, and we have history on our side when we almost got bin Laden in Tora Bora.

This scenario won’t happen.  We may get lucky and nab bin Laden and Zawahiri.  Both parties will claim success.  I guess the last question I should leave you with is, “If we’re not going into FATA, then whose interests would it be in to make sure we never do?”

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Filed under Foreign, International Affairs, Policy, Security, Terrorism/Insurgency

Implications of Amazon’s Mechanical Turk

I got this link via Waxy of Waxy.org.  In it, he writes about how he needs to transcribe an interview he recorded onto MP3 files.  He decided to use Amazon’s Mechanical Turk, which is a service that lets people post micro-jobs for other people to do in exchange for micropayments.

He set up small jobs for people to transcribe the MP3s for him. He posted them before he went to sleep, and when he woke up, other people had completed his task for him for less than $16.

What are the implications of this system?  Well, so far it is being used by what seem to be spammers, using humans to describe images to beat security systems or to collect data for use in spamming.

But being able to pay others to do menial tasks has precedent — outsourcing to a surplus of labor, this time online.  Obviously it’s as prone to slave/poor labor abuse as gold farming in multiplayer online games is.

But on the positive side, it might allow us to tackle problems more quickly, such as allowing non-programmers to build applications by outsourcing small tasks of writing small code for them.  I know I could use it right now, but I’m not sure what I need yet.

The problem of translating/transcribing videos and audio used to be monetized by translation companies who charged a fortune to do it — now it can be done on the cheap online.  Companies that properly use this service could put a lot of tasks out online and let their employees work on more important things.  One problem of course is that one is limited in the data he can send to Mechanical Turk — he couldn’t let someone else work on his internal databases or phone registry, for example.

So it has its limitations.  But it’s a fluid, transparent system, isn’t it?  Who knows what will come out of it?

It reminds me of a different approach that uses games to get users to voluntarily — and for fun — label and classify photos and words:

I haven’t looked into other speculation about possible applications, but the Wikipedia page should continue to be updated with the more interesting of them.

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Filed under Economics, Globalization, Internet, Web

My Paper on American and Japanese 3G Networks

I wanted to post the paper I wrote for my “political economy of international communications policy” class last semester (Spring, ’08).  The topic of my research was how the build-outs of the networks in the US and Japan along with cultural differences led to the uses of cell phones and bandwidth that we can currently observe.  I then looked forward into the future to see which country might provide a better operating environment for my web service, Galapag.us.

Here is the link (Microsoft Word .doc, no viruses):  http://benturner.com/other/3GComparison.doc

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Filed under Business, Communications, Economics, Internet, Mobile, Policy, Web

Quotes from “Inside the Jihad”

I’m reading an excellent book, Omar Nasiri’s “Inside the Jihad:  My Life with Al-Qaeda”, for Michael Scheuer’s class about a guy from Morocco who ends up being a spy within a mujaheddin cell in Belgium and then goes through terrorist training camps in Afghanistan and other terrorist hotspots, finally writing a book about the dilemmas and moral quandaries he finds himself in as a Muslim disgusted with radicals.  Did I tell you I love this class?  I should also ask, “Is this book fake?”  The story is almost too good.

Here are some early quotes:

“Every boy has a dream — to be a fireman or an astronaut or a president, to be something fantastic.  Of course, most boys will never fulfill their childhood dream, but that’s not the point.  As a boy grows up and becomes a man, he gradually lets the dream go, although it may still linger in the form of nostalgia.  But if his dream is destroyed at a very young age, the boy will either be destroyed totally along with it, or he will become strong.  He will become strong because he no longer has anything to lose.  He will give up on the future.  A boy without a dream is dangerous.” (p. 12)

“His eyes flickered for a moment, and I knew I had him.  There are guys like this all over the world:  they drink, they smoke, they snort coke, they are complete infidels in the eyes of real Muslims.  But at the first mention of the words umma or jihad they suddenly reconnect with Islam.  I think this is particularly true in Europe, where young men are so far from everything, from the Muslim land.  Jihad is nothing to them, nothing real.  But it is also everything.” (p. 28)

“Only one thing really bothered me about my new career:  the Uzis.  It made me sad to see all of them — Hakim, Yasin, Amin — prattle on about umma and jihad while they spent thousands on Israeli guns and Russian bullets.  This is the problem of modern Islam in a nutshell.  We are totally dependent on the West — for our dishwashers, our clothes, our cars, our education, everything.  It is humiliating, and every Muslim feels it.  I felt it every time I thought about the Uzis.  I was disappointed with Amin and Yasin for their hypocrisy, but even more disappointed in the Muslim world.  Once we had accomplished so much — in science, mathematics, medicine, philosophy.  For centuries we ran far ahead of the West.  We were the most sophisticated civilization in the world.  Now we are backward.  We can’t even fight our wars without our enemies’ weapons.” (p. 38)

“‘Your battle against the terrorists.  You’ve already lost your battle.’  Gilles was curious and asked me why I said that.  I told him that Muslims everywhere were rebelling against the dictators they lived under.  In Tunisia, Morocco, Egypt, Algeria, and all over the Middle East, Muslims knew that their governments were being propped up by France, England, or the United States.  It was bad enough to live under these repressive regimes, but far worse knowing that these regimes were just the playthings of Zionist and Christian nations.  It enraged Muslims and made them hate the West.  And it made them distrust democracy, because they saw how antidemocratic Western countries could be when it served their interests.  There would always be violence, I told him, as long as Western powers continued to manipulate the Muslim world.” (p.53)

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Filed under Foreign, Globalization, Policy, Security, Terrorism/Insurgency

Sharing

A few weeks ago, there was an excellent article in the NYTimes about online ambient awareness.  This article was immediately influential — it was quoted and passed around by a lot of blogs and readers, and I got personal e-mails saying that it reminded them of my Galapag.us project.

An excerpt:

But as the days went by, something changed. Haley discovered that he was beginning to sense the rhythms of his friends’ lives in a way he never had before. When one friend got sick with a virulent fever, he could tell by her Twitter updates when she was getting worse and the instant she finally turned the corner. He could see when friends were heading into hellish days at work or when they’d scored a big success. Even the daily catalog of sandwiches became oddly mesmerizing, a sort of metronomic click that he grew accustomed to seeing pop up in the middle of each day.

This is the paradox of ambient awareness. Each little update — each individual bit of social information — is insignificant on its own, even supremely mundane. But taken together, over time, the little snippets coalesce into a surprisingly sophisticated portrait of your friends’ and family members’ lives, like thousands of dots making a pointillist painting. This was never before possible, because in the real world, no friend would bother to call you up and detail the sandwiches she was eating. The ambient information becomes like “a type of E.S.P.,” as Haley described it to me, an invisible dimension floating over everyday life.

“It’s like I can distantly read everyone’s mind,” Haley went on to say. “I love that. I feel like I’m getting to something raw about my friends. It’s like I’ve got this heads-up display for them.” It can also lead to more real-life contact, because when one member of Haley’s group decides to go out to a bar or see a band and Twitters about his plans, the others see it, and some decide to drop by — ad hoc, self-organizing socializing. And when they do socialize face to face, it feels oddly as if they’ve never actually been apart. They don’t need to ask, “So, what have you been up to?” because they already know. Instead, they’ll begin discussing something that one of the friends Twittered that afternoon, as if picking up a conversation in the middle.

I’ve met a lot of new people since coming to Georgetown, and they’re more wired than many of my friends in the military, who are for the most part still not publically online yet.  Combine this with work commitments and trying to get myself enmeshed in the startup/web2.0/online communities, and I get inundated with a lot of information flows.

This is not to say they’re more important than my friends and my family, but it did get me to start thinking about passive communication.

A lot of people are still not contributing information to the internet.  They write some e-mails, they view some web sites, and that’s about all they have time for.  This is fine, and is to be expected.

But for people like me, I share quite a bit of my life and opinions online and anyone who was even vaguely interested in keeping up with what I do would be able to without really knowing me.  This could potentially be bad, but if you were to total it all out in the long run, it’s probably more beneficial towards me and my reputation (my brand, as it were) to share.

But most of my friends and family do not share.  At least not in a way that is captured easily.  So I am learning how to allow for passive participation but it needs to be reciprocated.

More people need to contribute, even if only a little.  Perhaps this is why Twitter has done so well.  It allows for 140-character updates.  So you don’t feel burdened by writing a lot.  Just a little note to say what you’re up to.

Let’s do this…it makes for sharing what’s on all our minds easier.  You may have great ideas and thoughts, but how will people know about them unless they directly ask you?

“I don’t understand how this stuff works.”  Well, like e-mail and the web, you’ll be using it eventually.  Stop fighting it and learn.  Certainly find what makes the most sense to you, but don’t write it off.  It might be that you’ll end up having to use it at work, so see it as an investment in your communications education.

Said Tim Berners-Lee, father of the web:

Letting your data connect to other people’s data is a bit about letting go in that sense. It is still not about giving to people data which they don’t have a right to. It is about letting it be connected to data from peer sites. It is about letting it be joined to data from other applications.

It is about getting excited about connections, rather than nervous.

And Jan Chipchase, Nokia ethnographer, said:

Whilst sharing music, video, intimate details is both inherently human and mostly positive – we have to recognise that when the default is to share then it creates significant social pressure on those that prefer not to since the question of opting out of adopting a technology becomes one whether to opt out of society. You can see it today with late adopters who are pressured by relatives or their employer’s [sic] into carrying a mobile phone, but the same applies to any mainstream connected technology.

If everyone I knew contributed, it would certainly make my life easier…and I’d be able to keep tabs on what everyone’s doing without being a burden.

And while nothing beats a phonecall or personal visit, those aren’t always realistic options.

Stop being stingy!

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Filed under Anthropology, Internet, Openness, Web

Tim O’Reilly on Priorities

Good video from the Web 2.0 conference in NYC. O’Reilly refers back to the divergence between what software developers are working on (silly Facebook apps) and all the major problems in the world which they are NOT addressing.

As a development student with a tech background, I see this first-hand. Hell, that’s why I went into development in the first place, despite my interests in other areas like counter-terrorism and foreign policy. What are we going to do about the bottom billion, or the increasing income gap?

However, I think it would be unrealistic to ask programmers to have much of an impact in Africa or among the most disconnected poor…

Still, worth watching:

http://www.web2expo.blip.tv/#1283514

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Filed under Economics, International Affairs, Internet, Web

The Government Finally Gets Serious

I almost fell out of my chair yesterday while reading for class. I luckily had CNBC on and they announced that Hank Paulson was talking to Congress about a big move to save the markets, using Congress’s unlimited balance sheet, as Steve Leesman just said on CNBC.

I bought as soon as I could and scalped it for some money… And in general I’m very happy that they made this move. I think this is a serious change unlike previous stopgap options. Will it work? Not sure, but it is at least a move that makes sense.

A lot should happen this weekend…

Whew! And was I reading for class while watching the market and CNBC? Uh… So anyway…

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Filed under Business, Economics, Stock Market