Saturday, December 7, 2013

Employment Update: November 2013

November’s job gains at 203,000 are slightly lower than they were in October. October’s results, as reported last month, were adjusted upward by 8,000 jobs to result in 212,000 jobs. So, you might say, we are on an even keel approaching the final month of the year. These data were published by the Bureau of Labor Statistics (the press release is here). The new chart graphic the jobs situation follows:


With November’s result reflected in the projections for the year 2013 (based on year-to-date data), 2013 is shown to have performed better than the last three years. The current projection is that the annual growth in jobs will be 2.263 million (last month it was 2.236 million). In 2013, thus far, the economy has created, on average, 5,700 more jobs per month than in 2012. The chart showing the projection comes next.


The data published yesterday also got us closer, in percent measurement, to the recovery of all jobs lost in the disastrous years 2008 and 2009. At present, we have recovered 85.9 percent of lost jobs (last month we’d recovered 83.4%).

Friday, November 29, 2013

Sluggish Retail

Last year, at this time, I published a graphic showing the monthly retail sales of General Merchandise Stores—by way of illustrating the problems faced by retail trade—yes, even in this, the biggest, selling season of the year (link).

I thought that I would show an updated version of that chart. Here it is:


Last year I only had a few early months of 2012 to show. This time I show all of 2012 as well as results for 2013 through September.

Note particularly that these stores did better than in the earlier year in 2010, 2011, and in 2012. But when we look at 2013, the values achieved in that year fall right at, below, or slightly above the sales performance in 2012 all depending on the month. You might say that no real growth is showing at all. This explains the hysteria behind the Black Friday sales campaigns that I noted in the last post.

To illustrate 2012 and 2013 performance more sharply, herewith a bar graph, by month, of sales up to September. I have include two trend lines. The top line represents 2012, the lower line 2013. Note that trends in 2013 are lower—suggesting, if things continue in the same way for the rest of 2013, that this year will come in worse than last. Not the time to be in the retail business nowadays, as I heard a fellow analyst (and family member) say just yesterday. No. And these days the reliable alternative occupation, somewhere in Health Care, also looks rather dicey…


The data used in this analysis come from the U.S. Bureau of the Census, here, showing various sources of retail data.

Thursday, November 28, 2013

Danse Macabre

I had an occasion Thanksgiving last to mark this occasion with an advertisement from Kohl’s. The ad was printed on the plastic sleeve that brought our Thursday edition of the Detroit News. That edition  has been, and remains to this day, by far the thickest, a kind of desperate package of retailer anxiety. Well, it has happened again. Herewith a picture of the 2013 Kohl’s ad:


Nothing like maintaining a tradition, don’t you know. The main difference between the 2012 and the 2013 ad? In 2012 Kohl’s doors opened at midnight on Thanksgiving; this year they will open four hours earlier.

Now I’m only singling out Kohl’s here because of its prominent self-display, for the second Thanksgiving running, looking much the same. But the rest of the paper this year, like last, shows the hysterical anxieties of the retail sector . Paging through the paper today, a single thought, in German at that, rose up in my mind: Totentanz—the Dance of the Dead; the French version produces the nicest headline.

Let us see now. This is the fourth year of our so-called recovery. By recovery our retail sector probably imagines the return of frantic shopping growing at more and more intense rates every year. The public, instead, is holding back. The Spirit of Consumption seems to have fled permanently. To be sure retail sales grew—in 2010, more in 2011, and more again in 2012; the growth, however has been sluggish. The flavor, smell, and rhythm of this growth has not been right, somehow. Is a really big change underway? Is the world recovering from many decades of madness? If so, very major changes in retailing are indeed unfolding in slow motion still and the hysterical danse macabre is thereby explained.

Saturday, November 9, 2013

Employment Update: October 2013

Employment data for October 2013 are somewhat ambiguous. A total of 204,000 jobs had been added to the economy, significantly higher than the 148,000 jobs reported for September 2013 last month. But, as usually, the Bureau of Labor Statistics, which reports these data monthly (the press release is here), revised September numbers upward by 60,000 jobs. September results, therefore, at 208,000, were actually better, by a hair, than October results. And for all we know, October results may also be revised next month. We’ll see. Tracking these numbers requires a certain amount of patience before real trends become believable.

Herewith the updated chart:


This year I have been publishing projections of year-to-date numbers out for the total year. Last month and the month before, the annual projections were under-performing 2012. This month’s data show a positive change. It now looks like 2013 will produce a total gain in jobs of 2.236 million, better than the economy managed to do each year in the 2010-2012 period. The graphic showing annual data and the 2013 projection follows:


At the same time, what with nearly four years of recovery behind us, we’ve only recovered 83.4 percent of the jobs lost in the 2008 and 2009 period. At this month’s rate of adding to jobs, we’ll have to wait almost seven months more before we have achieved the employment level we enjoyed in December 2007.

Friday, October 25, 2013

Twitter's Valuation

Twitter—like all of the social media—is totally dependent on advertising revenues from a purely commercial point of view. Like virtually all other so-called tech companies, it is losing money even as it is preparing to go public with an initial public offering (IPO).

The company values itself at $11.1 billion, which seems from out here, viewed through innocent eyes, as rather a huge number considering that it had revenues of $422.2 million as of September of this year, alongside losses of $133.9. Let’s annualize those figures. Extended to 12 months, revenues will be $562.9 in 2013. That would be equivalent to 1.5 percent of total Internet advertising expenditures of $36.6 billion last year. Twitter’s losses for 2013 project to $178.5 million, meaning that its revenues don’t even cover costs yet—never mind profits.

More to the point, advertising, considered as a function of the total economy, is actually much ado about nothing, as I illustrate in the last post. Total ad revenues, all media, stood at $141.7 billion in 2008—and had dropped to $135.9 billion in 2012. Doesn’t look like a growth industry at present.

The message, of course, is that the Tech Bubble continues still. Come to think of it, “tech” seems to produce them. There was the Railway Mania in Britain in the 1840s—an illuminating bit of history worth revisiting as we see the “social media” and “mobility” soaring. There are such a thing as real utility, real industry, and real technology. But when irrational expectations produce investment hysteria, even real estate can have an unreal bubble—based on “innovation” in financing instruments—another “technology.”

Much Ado About Almost Nothing

This is a repost of an entry from the first LaMarotte originally published on July 27, 2009. I revive it now, with an update of the numbers, to support another posting which follows this one.

The Gross Domestic Product in 2008 was $14,264.6 billion (all right, that’s $14.3 trillion). GDP is the sum total of all economic activities in the United States. In that same year total expenditures on advertising amounted to $141.7 billion. With calculator in hand we can determine that advertising is just a sliver under 1 percent of GDP (0.99%).

[Corresponding values for 2012? Here they are: GDP $16,244.6 billion ($16.2 trillion), Advertising $139.5 billion, and advertising as a percent of GDP still only a hair of the total GDP, less than 1 percent (0.86%).]

I was led to make this calculation because today’s Business Day, the business section of the New York Times, perhaps coincidentally, was crowded with stories about advertising or closely related subjects. Stories dealt with (1) curbing commercials, (2) measuring responses to advertising messages, (3) late night TV programming battles (featuring ratings), (4) a TV morning show, (5) the role of giveaways in marketing, (6) NPR activities on the Internet,  (7) a technology convention being used as an advertising medium, (8) promotion of investing by using cartoons,  (9) a trademark battle between brands, and (10) a user-designed magazine and user-designed ads. Other stories were closely linked to the communications field: (a) iPhone, (b) Amazon and the Kindle, (c) a wireless acquisition, (d) Twitter, (e) the digital divide (African Americans are less represented on the Internet),  and (f) a story about the Gannett news organization. Only a single story, about toxic assets, even hinted at the fact that 99.01 percent of the economy [in 2008] might be doing something other than worrying about advertising or the media. I hasten to add here that the New York Times’ coverage of business is usually more diverse.

Since advertising is intrinsically linked with communications, it is visible because it has to be, intrusive because, well, it has to be, and therefore its presence is artificially exaggerated by its very function. We’re barely aware of the rest of the economy—unless some part of it fails us.



Our ways of perception have evolved so that we notice change above all—any deviation from the normal, ordinary, and habitual. Advertising exploits this aspect of our natural design. Our communications media, similarly, can only prosper when they’re seen. Both commercial and regular media therefore attempt to grasp our attention. The two ways to do so are by tempting or by shocking us. The relentless auction that modern life has become therefore produces a highly distorted sense of reality—sex and violence everywhere. But we see virtually none of that unless we’re in contact with media. Interesting. In the chart I’ve inserted, what we see is “All the Rest.” What we see on the media, writ very large, is the little sliver that I’ve labeled “Advertising.” Inverted impressions.

Wednesday, October 23, 2013

Employment Update: September 2013

Thanks to the government shutdown, this monthly report came yesterday, some 19 days after its regular appearance (first Friday of the month). The results are a gain of 148,000 jobs in September, lower than the number reported for August. These data come from the Bureau of Labor Statistics press release of yesterday (link). The BLS also published revisions for July and for August, netting out to an additional gain of 9,000 jobs. Herewith the graphic:


If we project year-to-date numbers to the entire year 2013, we see that 2013 is likely to turn in a lower gain in total employment than 2012 did. This month, like last, the projection has dropped. Last month in was 2.163 million jobs, this month 2.132 million. That graphic follows:


Despite the theme of the year 2013, which is Sluggish, a positive note is that all but two major sectors show gains. The two posting losses are Finance (down 2,000 jobs) and Leisure and Hospitality, down 13,000. People don’t seem to be in the mood to take a vacation.

It will be interesting to see what impact the October troubles will have had on this all-important indicator of our economic health.

Sunday, September 8, 2013

Flash from a Distant Mirror

[Note: This post first appeared on another and earlier version of LaMarotte on June 8, 2009. I have closed that blog because advertisements began to appear on it. Some of the posts from that version, however, are reprinted here.}

The following quote is taken from a history entitled Caesar and Christ, by Will Durant, Simon and Schuster, 1944, pp. 111-112. It deals with an era known as the Agrarian Revolt in the Roman Republic, extending in time from 145 to 78 BC, thus the period immediately preceding the rise of Julius Caesar, who became the first emperor of Rome and thus closed the republican era of Roman history. Durant is summarizing the causes of the revolt:

The first cause was the influx of slave-grown corn from Sicily, Sardinia, Spain, and Africa, which ruined many Italian farmers by reducing the price of domestic grains below the cost of production and marketing. Second, was the influx of slaves, displacing peasants in the countryside and free workers in towns. Third, was the growth of large farms. A law of 220 forbade senators to take contracts or invest in commerce; flush with the spoils of war, they bought up extensive tracts of agricultural land. Conquered soil was sometimes sold in small plots to colonists, and eased urban strife; more of it was given to capitalists in part payment of their war loans to the state; most of it was bought or leased by senators or businessmen on terms fixed by the Senate. To compete with the latifundia the little man had to borrow money at rates that insured his inability to pay; slowly he sank into poverty or bankruptcy, tenancy or the slums. Finally, the peasant himself, after he had seen and looted the world as a soldier, had no taste or patience for the lonely labor and unadventurous chores of the farm; he preferred to join the turbulent proletariat of the city, watch without cost the exciting games of the amphitheater, receive cheap corn from  the government, sell his vote to the highest bidder or promise, and lose himself in the impoverished and indiscriminate mass.

Roman society, once a community of free farmers, now rested more and more upon external plunder and internal slavery. In the city all domestic service, many handicrafts, most trade, much banking, nearly all factory labor, and labor on public works, were performed by slaves, reducing the wages of free workers to a point where it was almost as profitable to be idle as to toil. On the latifundia slaves were preferred because they were not subject to military service, and their number could be maintained, generation after generation, as a by-product of their only pleasure or their master’s vice. All the Mediterranean region was raided to produce living machines for these industrialized farms; to the war prisoners led in after every victorious campaign were added the victims of pirates who captured slaves or freemen on or near the coasts of Asia, or of Roman officials whose organized man hunts impressed into bondage any provincial whom the local authorities did not dare to protect. Every week slave dealers brought their human prey from Africa, Spain, Gaul, Germany, the Danube, Russia, Asia, and Greece to ports of the Mediterranean and the Black Sea….

There is a great deal more along these lines, providing more detail. Durant was a very popular historian in his day, hence a copy of this book may very well be available in a decent local library. Needless to say I recommend a perusal of some pages of this important chapter. It is a kind of mirror held up to us by the past. To be sure, the economic level of Rome was on a lower stage. It was a time when agriculture was the industry and neither fossil fuels (our energy slaves) nor machines to use them had been invented yet. At the same time the public franchise had been obtained by Roman citizens who owned property; the forms of it were complex and comparable in many ways to ours. This posting will give some context to some of my past and future entries regarding the sensitive subject—sensitive because it violates our faith in the Free Market—of a national industrial policy. In the absence of one—and one based on genuine justice and values—has in the past led to chaos.

The term latifundia, plural of latifundium, was a Roman coinage of the time combining the word latus meaning “spacious” and fundus meaning “farm” or “estate.” The foundation of civilization is the fundus, the agricultural land.

Friday, September 6, 2013

Employment Update: August 2013

On the face of it, we gained 169,000 new jobs in August 2013—according to the Bureau of Labor Statistics press release today (link). But the BLS also revised results for both June and July—downward. I am presenting those revisions graphically, just for once, so that their impact may be more viscerally felt. Now if you add the revisions, 16,000 jobs fewer than earlier reported for June and 74,000 fewer than reported for July, the net effect is a loss from totals reported for that period of 90,000 jobs. Therefore August gains, netted out, are only 79,000—which is quite another story. The usual graphic, showing the total picture, follows here:


This year I have been annualizing monthly returns—thus projecting trends, up to the present, out to the entire year. This means totaling monthly gains and dividing that sum by the number of month and multiplying the average by 12. That picture follows.


Note that, as of August, the year 2013 is projected to perform worse than 2012 did—but still better than 2011.

Looking at sectors, Construction and Other Services neither lost nor gained any jobs. Two sectors lost jobs: Information (read communications) and Finance. Retail Trade produced the largest sectoral gain (44,000 jobs) followed by Health Care and Social Assistance (38,000).

Wednesday, August 21, 2013

Legal or Ethical

A story in the New York Times this morning, the headline in the digest we get is Many Wall Street Banks Woo Children of Chinese Elites, reminds me of the hard-to-describe difference between legal action and ethical behavior.

What is happening here is that firms like Goldman Sachs, Merrill Lynch, and JPMorgan Chase hire the sons and daughters of politically high-placed Chinese leaders in the expectation that they will gain major favors in consequence, not least insider knowledge of how things are arranged in governing circles. Such actions are neither illegal nor yet hidden. (Doing it in the open would seem, indeed, quite beneficial—signaling that your company is well-connected.) At the same time, this sort of thing causes hair to rise up on my arm. It has ethical implication.

Once in my career I walked from the biggest contract one of the companies I was running could have snagged when a lawyer from Louisiana, who had arranged to meet me at O’Hare, where we would both be passing, suggested to me that our company should place some advertisement in a particular magazine. The job was worth half a million, the advertisement about five thousand. But that modest expenditure would have ensured approval of our contract by a Louisiana state agency. A relative of the head of that agency worked at the magazine. We needed that contract—like badly. And nothing would have been traceable. Nor was it illegal to advertise in that or any other magazine. Choking down my disappointment, I walked—and no, I did not first check with the layer above mine.

My own action, even then, would have been viewed as naïve. But, there you are. It all depends on where you live. Is it in the universe of the pragmatic or the universe of the ethical? These days, much the same. And, needless to say, the NYT article does carry the almost obligatory quote usually found in articles such as this one. “But everyone does it…”

Now an even more difficult-to-judge situation. Merrill Lynch manages our various holdings of what is usually referred to as our “wealth.” And Merrill Lynch is one of the Wall Street banks said to participate in Hire the Big Chief’s Child. So how much of that perfectly legal stain will stick to our skin?

Friday, August 2, 2013

Employment Update: July 2013

The new employment data published by the Bureau of Labor Statistics today (link), are certain to produce frowns. Expectations had been for a gain of minimally 185,000 new jobs—and those with their eyes on the stock market hoped for something like 225,000. The actual results were otherwise.

The economy gained 162,000 jobs in July. However, June results were revised downward by 26,000 jobs, and if we factor that change in, the net gain was an anemic 136,000 in new employment. There is definitely a difference between watching jobs and watching the Dow. The Dow is more exciting, no doubt about it. The monthly chart follows:


The annualized projection for the year 2013 has also suffered a small decline. Last month it looked like we would end the year with a gain of 2.422 million jobs added. This month’s result is 2.309 million. It is still better that the gains of 2010 through 2012, but, on the jobs front, anyway, we’re still just threading water. That chart is next.


The positive note, this month, is that all but one of the sectors of the economy posited gains in employment. The only sector falling short, posting a loss, was the somewhat obscure Other Services category; it posted a loss of 2,000 jobs.

Wednesday, July 24, 2013

Confidence

The word indicates an inner feeling, but sometimes it is best to parse it. It comes from “trust,” combined with “with,” thus trusting with or trusting X. It seems to me that the X is here the issue. We use the word in relationship to the inanimate ranges of reality of well. We’ll test a knot and say that we are confident that it will hold. But when it comes to complex situations that we cannot actually test, like we can test a knot or a beam, the presence of confidence or lack of it has everything to do with people, with agents. Public confidence in the economy—therefore motivating us to spend or to invest—is not produced by careful observation of a mechanical arrangement but comes from a general “feel,” as it were. And much of that feel comes from the news, the media—alongside talking to other people and observing what they do.

The New York Times and the Wall Street Journal both feature stories this morning that certainly shape public confidence. The NYT headline: HOUSE G.O.P. SETS A NEW OFFENSIVE ON OBAMA GOALS. The Journal’s: RANCOR IN WASHINGTON FANS PUBLIC DISAPPROVAL.

It’s really the same story, although the Times’ focus is on actual planned cuts in budget whereas the Journal concentrates on a Wall Street Journal/NBC News poll showing public disapproval of Congress—which has reached an all time high of 83 percent.  Obama’s approval rating was low too, 45 percent. The Founding Fathers would here have talked about the evils of faction. That last word comes from the Latin for “a making or doing” used ever since to mean a political party or a class of persons.

Uncertainty breeds lack of confidence and conflict breeds uncertainty. No. We cannot neatly isolate the political from the economic, the personal from the public. Nor can such things as attitude be put in place by Constitutional language. Yet the performance of a democracy absolutely demands that once an administration has been elected by the public, the political conflict that resulted in that outcome must be brought to a halt; unified action must follow. We now have a situation that, were it manifesting in a person, would make that person highly unreliable. He would no sooner start something than try to destroy it, say something then try to unsay it, promise something and then do the opposite. With such a “person” in charge of our country, can we be confident? Civil war comes in many different forms—acute and violent, insidious and undermining. We have the latter, Syria the former. In a forced choice, I’d rather have ours—but in a free choice I don’t want civil war at all.

Tuesday, July 16, 2013

The Spreadsheet Never Frowns

My subject is feedback. Or management. Or the nature of too-highly-layered hierarchies. Consider an efficient hierarchy. It will be three-layered at most—and each layer will communicate with the one next to it face to face. In such a situation, people will be talking to each other—and what with frequent contact, will become familiar with each other at the personal level. Our current institutions are vastly more complicated—at least twelve levels in most cases. Furthermore, the chain of command will be further confused by the intrusions of committees. Very often the feedback from customers or clients will come to the top in the completely faded form of pure numbers on a spreadsheet—whereas, when the scale is human, the bad or good news will take the form of a person making a report, one human to another. The problem of size, simply, is that a spreadsheet never frowns—but people do. And when the next layer down arrives at the office with a dark face, one must be prepared to do something about it.

Supposing you were a high-flying trader who sold toxic real estate bonds directly to “widows and orphans”—as Fabrice Tourre, formerly of Goldman Sachs, told his girlfriend that he had done. And suppose the uncles, brothers, or cousins or other muscular relations of those widows and orphans had gotten a hold of Fabrice Tourre and applied to him the “feedback” of beating him to within an inch of his life? He would have learned a whole lot earlier that he was breaking the rules of morality. But twelve-layered hierarchies protected him until now. And he may still get away with it shielded by hosts of high-priced lawyers.

Friday, July 5, 2013

Employment Update: June 2013

The new employment numbers for June arrived this year on the fifth of July (see BLS release). Decent results, actually. Job gains in June were 195,000. April and May results were also updated, for a combined additional gain in those months of 120,000 jobs. This caused April results to come in at 199,000, May results at 195,000. The resulting monthly chart follows.



If we look at these results on an annualized basis, thus January-June results extended to the rest of the year, the economy continues to perform better than it did in 2010, 2011, and 2012. The graphic showing that comes next.


If we look at this on a monthly basis, we get the following. In 2010 we gained on average 85,200 jobs a month, in 2011 175,300, in 2012 182,800, and in 2013, to date, an average of 201,800.

During the Great Recession we lost 8.578 million jobs; in the three-and-a-half years since then we gained back 6.506 million. This means that we’ve now recovered in that much longer period 75.8 percent of job. Its going slowly, but we are gaining.

Recovering jobs lost in the Great Recession is not the same as adding jobs to accommodate the growth in our workforce. An earlier posting (here), shows that we need to add 87,300 jobs to the workforce every month just to accommodate our growing population. So long as we are just recovering lost jobs, we are not creating jobs for the young. Since the Great Recession ended, we have therefore accumulated a demand for 3.7 million new jobs (42 months times 87,300). It’s only after we have regained all losses that job gains will count against that growing deficit. 

Looking at sectors, some sectors were still posting losses. In June these were Manufacturing (down 3,000), Transportation and Warehousing (down 5,100), Information (down 5,000), Miscellaneous Services (down 4,000), and Government (down 7,000). The continuing loss in government employment is a marvel—what with our legislators all clamoring about creating jobs.

Thursday, June 20, 2013

Fusion Footnote

Although the theoretical background of fusion as a source of energy has been solidly established, experiments on a smaller scale have not yet yielded a positive energy balance (less total energy needed to keep the fusion process going than comes out as a net result).
     Fusion Energy Foundation (link)
Having mentioned fusion power elsewhere, I got curious about the subject again. In a sci-fi novel I once projected a future in which tokomaks (I called them takamaks, a variant spelling) were quietly supplying the world’s energy until the ocean seemed to resist the continued extraction of deuterium from its waters. A fictional speculation, to be sure. That was ten years or more ago. So now I got curious. I wondered what had transpired since. My interest, this time, was more conventional. I wanted to know the energy balance of this technology.

I was curious for a reason. A couple of years ago, in a free-lance assignment, I looked at ethanol production in this context and discovered there that, if all energy used in making ethanol is actually counted, ethanol production has a negative balance, meaning that inputs exceed the energy actually recovered. In the fusion game, this balance is referred to as Q. The output divided by the input is  Q. A Q=1 therefore means that energy expended is equal to the energy harvested. Anything higher than 1 is a gain, meaning that the technology pays for itself in an “energy economy.” If lower than 1, the technology isn’t justified in a purely physical sense. I put that phrase in quotes because energy balance is not the same as economic balance. Ethanol is cost effective, especially since it’s subsidized; from an energy point of vantage it is a loser.

The leading fusion process attempts to fuse a deuterium atom with a tritium atom. These are forms (isotopes) of hydrogen. Hydrogen has a single proton and a lone electron. The overwhelming majority of hydrogen atoms (99.98%) are of this simple type. Deuterium has a proton and a neutron both; a minute amount of hydrogen in the ocean (0.015%) takes the form deuterium. Tritium has a proton and two neutrons. For all practical purposes it does not appear in nature, at least not for long. It is produced by cosmic rays. It can also be produced by man using lithium as a starting medium. Anyway….

When you force a D and a T close enough together, they do everything in their power to resist you. Why? They both carry positive charges and repel. You have to exert energy of 0.01 million electron volts (MeV) to overcome this resistance. When you succeed, you produce an atom of helium, a single neutron that flies off as radiation, and 17.59 MeV of extra energy. This entire reaction therefore requires the 0.01 MeV at the very last stage—by the time you’ve really squeezed the atoms together—to yield the output, thus Q=1759! That’s major, as it were.

You might wonder how much energy an MeV actually carries. Thanks to Wikipedia, I can report that 4 MeV is the stupendous force with which a single snowflake crashes down on a trembling concrete drive. Obviously, in the case of fusion, we need a whole lot of Ds and Ts colliding and fusing before we can talk about real power.

Now we know the maximum potential of this technology. It’s a whole lot more attractive than that of petroleum which, as I remember, produces something like a Q=45. And that ratio has built the modern world. So what has fusion produced thus far in its roughly 60-year history. Developments began in 1950.

The best performance on record to date was delivered by the JET program (Joint European Torus, based in Culham, Great Britain). It delivered Q=0.64 for a few seconds, the short duration being characteristic of these experimental machines. The output was 16 Megawatts, produced by the expenditure of 25 MW. The record!

The ITER program, the biggest yet and still in the building stage, expects to achieve Q=10 in short bursts and Q=5 in more sustained production runs. ITER’s original name was International Thermonuclear Experimental Reactor, but that name worried people what with scare-words like thermonuclear and experimental being so close together, so the long phrase is no longer used. ITER’s fusion reaction is being raised now in Cadarache, in France.

Now the projected Q is a long ways of 1759, of course, but you have to account for the fact that long before we have the D and T close enough together to give them that last, tiny, 0.01 MeV nudge, we have get them into hailing distance first. That requires creating enormously hot plasmas inside magnetic containers that require cryogenic cooling in the -273 Celsius range. The cooling alone is very energy-intensive.

As for timing, the facility won’t be built for another eight years or so—if all goes well. And the distance between 0.64 and 10 is great.

To wind this up, the conditions ideal for bumping the heads of Ds and Ts is at the core of the sun where gravity does most of this work, where D and T have nowhere to go, and very sensitive disturbances can’t simply cause that great plasma up there simply to fizz out—like the light in our tokomaks routinely does.

Re-post Note: This post appeared first on April 9, 2009 in the Wordpress version of LaMarotte. I have since deleted that entire blog to avoid having my work used by advertisers. A selection of such posts will be reproduced here over time.

Monday, June 17, 2013

3-D Again? So Soon?

Why just the other day, a month ago, I noted my own problems with 3-D display technologies and thought that they are doomed (link). That case involved a smartphone to be launched with 3-D images on its screen. Today I read (NYT, “ESPN Drops 3D Channel”) that a 3-D TV venture, ESPN’s, will be headed for techno Walhalla because the public doesn’t want to bother. Confirms what I’ve been seeing and experiencing literally from my late teens, thus for nearly sixty years: people are perfectly satisfied watching entertainment in a two-dimensional projection. Ordinary images provide the human eye sufficient information so that the three-dimensional reality behind them can be easily discerned. Will that stop our innovators from trying again and again and again? Probably not.

Friday, June 14, 2013

Slingshot Boom?

I have no dog in this fight nor do I own any slingshot stock, but what with the Administration having perceived crossing a red line drawn somewhere, I expect that the most politically inoffensive way to rush to the Syrian rebels’ aid would be to order massive shipments of slingshots for delivery there. By some careful diplomatic phrasing, the slingshot could be presented as a weapons system, and the cost might be quite moderate while yet boosting employment.

As for where I stand, my views of international relations were formed by reading George Kennan. I don’t see even a sliver of national interest in supporting either party in Syria—and that because I don’t consider the State of Israel as the 51st state, much less primus inter pares.

As for slingshots, I see major retooling and expansion. And, one hopes, the cross-bow and bo-n-ar industry lobbies are already planning to storm Congress to get a piece of the coming action.

Thursday, June 13, 2013

A Cultural View of Demographics?

The U.S. Bureau of the Census published its annual population estimates for the United States yesterday. Almost obscured in the original table released (here), is the fact that in the fiscal year under examination (July 1, 2011 to July 1, 2012), the demographic category labeled White Alone, Not Hispanic, experienced more deaths in the period than it had births. The difference, in favor of deaths, was 12,419. Nevertheless, “White Alone” gained 175,965 people—all due to immigration; total immigration was 188,384. That number was also “White Alone” immigration. That number, less the 12,419 above, yielded a positive gain in “White Alone” numbers, a minimal up-tic of 0.1 percent over 2011. All other groupings increased by higher percentiles: Asians by 2.9 percent, mostly from immigration, Hispanics (of any race) by 2.2, and Blacks by 1.1 percent.

What the Census Bureau emphasized in its headline was the gain in Asian population. What the media picked up was that “White deaths outnumber White births.” Now, it so happens, that 88.2 percent of the 53 million Hispanics are racially White. Indeed, when White Hispanics are included with other Whites, Whites gained 0.5 percent in population. That’s still the lowest performance, but a little better.

The upshot is that both the Bureau’s special segregation of “White Alone, Not Hispanic” as a category—and the media’s focus on that category—indicates a cultural factor running rampant in the handling of our demographic statistics.

Tribal concerns are never far from human interests no matter how secular and enlightened we think ourselves to be…

Tuesday, June 11, 2013

The Peculiar Apple Culture

Briefly, to be sure, I was a part of it. My first computer was an Apple II, I was a member of an Apple User Group, and wrote a column, titled “Daisywheeling,” in its publication. Then, later, I also bought an Apple IIe, and at least two Macintoshes. But that came after my realization that the Apple Culture was not for me. Those few Apple purchases following the II were in support of commercial ventures—and in the course of those, which went way beyond the Apple, we’ve purchased like scores of Intel machines.

I shied from Apple because, it seemed to me, it was cultivating loyalty as such and, in the course of it, exploited its followers by continuously and radically altering its product so that one couldn’t just get on with working, using Apple-provided tools, but had to engage in what amounted to sacrificial purchasing of ever-changing technology. By contrast, my first IBM PC continued to work for many years until, eventually, it sort of turned to grey dust.

The latest update of Apple’s iPhone software, reported this morning, shows that the old ways are still with us. The Apple Cult is still a reality. In the WSJ’s article I find this sentence:

Apple executives came out swinging against those who question whether the company which hasn’t released a major new product since last year, has lost its cool.
The phrase that caught my eye was “major new product since last year.” Every time Apple introduces a “major new product” it obsoletes a whole category—and its cultish followers are then required to sacrifice more megabucks to stay true to the thin god who introduces it in appropriate uniform (no tie in sight) looking like an escapee from the concentration camp and uttering oracular statements, in a darkened room, using an electronic pointer.

What the world needs now is a cylindrical Mac. For the vast armies of non-believers, that may sound like a joke. But the cylindrical Mac is on its way—obsolescing anything rectangular.

Friday, June 7, 2013

Employment Update: May 2013

According to the Bureau of Labor Statistics (see BLS release), the economy added 175,000 jobs. March results were modified by adding 4,000 jobs in that month; the total for April was reduced by 12,000 jobs. Revisions, therefore, accounted for a loss of 8,000 jobs. The net gain in May, therefore was 167,000 jobs—a decent increase but not a signal of any kind of growth-resumption. The graphic follows; pink bars indicate revised bars; red is the result for May—but subject to revision in the future.


This year I have also calculated, each month, what 2013 will look like as a whole if current trends hold. The projection, this month, based on five months of data, show that the economy will gain 2.27 million jobs. That result continues to be better than actual job growth in the 2010-2012 period, but it down from last month. Last month’s projection was 2.35 million.


Much as last month so in May, the real economy, that which produces goods, lost employment (1,000 jobs). So did government (a loss of 3,000 jobs). All the gains were in the services producing sectors, the two biggest gainers being Professional Business Services and Retail. Note here that within Professional Business Services, where 57,000 jobs were created, Temporary Employment accounted for 25,600 of those jobs or 45 percent. Even in the services, there is real hesitation in creating new, permanent jobs.

Wednesday, June 5, 2013

Demand for Risk?

In the Wall Street Journal this morning, in a story titled “One of Wall Street’s Riskiest Bets Returns,” we read the following: “Investors are once again clamoring for a risky investment blamed for helping unleash the financial crisis: the synthetic CDO.”

To recap the meaning of this term. Collateralized Debt Obligations are produced by pooling bonds of all kinds, arranging them into slices from safest to most risky, and then selling each slice. The riskiest slices have the highest returns. “Synthetic” CDOs pool insurance policies written on the bonds, also arranged into slices. Again, the least safe have the highest payouts. The larger the total amount of such pools, the greater the risk of a general melt-down.

It is entirely reasonable to think that our public life—that our governance—is altogether out of control. The financial melt-down began in 2006. These kinds of speculative derivatives were the principal cause of it. Now they are back? Let us not forget that creating ever greater “attractive” pools led to criminally negligent lending—guaranteeing a melt-down, sooner or later. Are the dynamics any different today?

Our national public sector, however, appears to be paralyzed. We should have had simple laws, already in 2008 or earlier, absolutely prohibiting the creation and trading of any kind of derivatives. That didn’t happen. You want to buy stock? Fine. You want to buy a bond? Fine. All other so-called creative “investment products” should be outlawed. Didn’t happen. Therefore, of course, even stocks and bonds are riskier to own. Gambling is carefully controlled all over these many states. Why is gambling on the markets getting a free ride?

Every jewelry store we pass has signs out saying: “We buy gold.” Well, the right answer to that is to hold on to gold. What with the “parents” now insane, it is almost predictable that in due time paper currency will go the way of all other intangible “instruments.” And people biting on coins will also return. It’s reasonable, in other words, to act as if the world has gone plain crazy.

Tuesday, June 4, 2013

Now They Tell Us

A week ago roughly I commented on the resurgent housing market (link), interpreting it as the return of home buyers, who really need housing, after a seven-year period of slumping. Today comes a rather startling news story; I saw it in the New York Times. It turns out that most of the home purchases have been made by investment houses acting, evidently, to “create” confidence. If that’s what they were doing, this news should dampen whatever confidence was there. “Nationwide,” NYT writes, “68 percent of the damaged homes sold in April went to investors, and only 19 percent to first time home buyers, according to Campbell Housing-Pulse.” That word, “damaged,” refers to impacted in price by the housing slump. Most of the houses bought by investment houses are being rented—awaiting higher prices yet when, presumably, they will be unloaded. Can news be trusted any longer? Every story about the economy’s turn-around (“At last!”) by media commentators cited the surge in home purchases—and that surge was interpreted as a shift in “consumer” confidence—rather than as Wall Street manipulation.

Thursday, May 30, 2013

A Spreadsheet of Old

At the bottom of a very, very old pile I came across a pad of paper which produced nostalgic memories. It was an all-purpose AmPad miniature spreadsheet, of the old-fashioned kind, thus neatly pre-ruled pages. Herewith an image of it. I call it a miniature because, on full-sized jobs of calculation, we used pads of much greater size. But they were essentially the same format you see here but made both wider and deeper.


The old spreadsheet—which also gave its name to the electronic kind—served exactly the same purposes. Ever notice that when you open a new page of Excel, for instance, one of the first tasks is to make the left-most column  wider—because that’s where the descriptive labels usually go? Well, in the old days the paper versions came that way. And, of course, both rows and columns were numbered. The electronic versions introduced column-marking using letters, which made it less confusing to reference a cell.

To be sure, working with the vast, physical, ancient spreadsheets was a bother. You had to have a calculator handy. And in the really early days those were not small and handy but big and bulky and almost too heavy to move.

Yes. Nostalgia. Most of it is of this flavor. Somehow the past appears in a rosy sort of light whereas the present is always in black and white. Until you recall what a major labor it was to revise a column already filled with numbers. All that erasing, all that cursing. Ah, the good-old-days.

Wednesday, May 29, 2013

It Ain’t Over Yet

The housing market started to plummet as soon as the 2005 was over—and then, measured in the value of business done, it plummeted like one of those cars falling off the collapsing bridge. Here is a chart from an earlier posting. In effect we’ve had a period of seven years and five months in which the housing market was dead in the water, and ship taking water on top of that. Obviously time enough had passed so that natural demand for housing would begin to build up sooner or later. And now we have reports that housing is up. Not surprisingly, these figures are over-hyped. Consumer confidence is also showing gains, although these are not dramatic—and have been fluctuating up and down. But suddenly everything is all right again?

Don’t think so. The housing market must be viewed narrowly—and pragmatically. Much as the automobile market. Those two categories are basic. Sooner or later people must buy a house, must replace the car. And these two areas will therefore respond to actual need. But when we look at the economy as a whole, it is still treading water. In the most recent monthly employment reports, all of the gains were in the Services sectors. Construction lost jobs, Manufacturing showed zero gains, Mining and Logging lost jobs too. The real economy is still stirring in uneasy sleep.

The upsurge of optimism is a function of unreasoning exaggeration. Our media does not simply report the news—with proper additions of the relevant context. It behaves, instead, like a megaphone with a mind of its own. The message is “Housing sales are picking up, home values are on the increase.” What we hear is something else: “Great news. America is confident again and the bonanza will soon resume.” But it isn’t over yet. The fat lady is still in the dressing room. It will be a while until she rolls on the stage and starts to sing.

Friday, May 10, 2013

In the 3-D Cul de Sac

A story in the Wall Street Journal informs me this morning that Amazon is developing a smartphone that will produce 3-D images on its screen. How will that look? Here from the story:

Using retina-tracking technology, images on the smartphone would seem to float above the screen like a hologram and appear three-dimensional at all angles.

Reminded me of my handful of experiences with 3-D attempts in the entertainment field going back into the 1950s. Each of these, from my perspective, was a total failure—introduced with a lot of hoopla but never taking hold. These foolish wastes of developmental money keep recurring at right regular intervals, but never bearing fruit.

On the same 2-D page where this story is, Aflac has an ad depicting, wouldn’t you know it, the Aflac duck. It looks perfectly three-dimensional to me, achieved by color shadings and a realistic perspective. What would I do if Aflac ducks were rising from my newspaper and seemingly floating in the air. Would shivers pass over my skin? Amazon, Amazon! Please! Don’t try so hard to amazon me.

Wednesday, May 8, 2013

Looking for Caffeine?

So what makes an energy drink energetic? The usual presumption is that it is caffeine. But if that is so, what is the best kind of beverage to drink to get that little boost? The answer, not surprisingly, is coffee! Herewith a selective listing of different beverages showing their caffeine content per fluid ounce:

Drink
Caffeine: mg per fluid ounce
As % of Brewed Coffee
Brewed Coffee
13.4
100.0
Mate
10.6
79.1
Red Bull
9.5
70.9
Instant Coffee
7.1
53.0
Instant Tea
3.2
23.9
Pepsi
3.2
23.9
Green Tea
3.1
23.1
Coke Classic
2.8
20.9

My source for this is energyfiend.com (link). Gatorade, often considered the energy drink for athletes, is not on the list because it contains no caffeine at all. Gatorade is designed to replace the salts lost in sweating. Mate, sometimes spelled maté, is a tea derived from the Latin American herb called yerba mate. Not surprisingly, it is drunk down there as if it were, well, like coffee…

Happy To Be Blue

Lots of people this morning must have chuckled grimly reading—be it in the Wall Street Journal or the New York Times—that the not-yet-one-year-old and “revolutionary” Windows 8 will soon be replaced by Windows Blue. When Windows 8 was launched last October, I compared it New Coke. Are you old enough to remember that fiasco? Coca-Cola introduced a new formula for Coke, named by the public the New Coke. This took place on April 23, 1985. Less than three months later, on July 10, 1985, the company made an about-turn. It went back to the old, traditional formula again—in the face of an absolutely massive public resistance.

Well, it looks like it will take Microsoft a little longer to correct its own error, but the change is already on the way. Windows Blue will return with the “traditional” interface, albeit, with a little nostalgia for its own errors, a few of the “tiles” so beloved by users of mini-devices will still clutter up part of the opening screen. And while they’re at it, Microsoft might well fix the big problem it heaped on unlucky owners of certain printers—by providing properly working printer drivers on its Blue.

To be “blue” means to be “sad.” Well, in this case, if all goes well, I’ll be happy to be Blue.
----------------
Earlier posts on this subject: October 11, 2012, October 25, 2012, April 11, 2013.

Saturday, May 4, 2013

Employment Update: April 2013

In March of 2013 the economy gained 202,000 jobs, not the 88,000 as reported by the Bureau of Labor Statistics. Employment data are usually revised. And March was revised upward by a quite significant amount. Now as for April, job gains last month were 165,000 (see BLS release). But, of course, they may also be revised in the June report. In any case, the news made everybody breathe easier. Herewith the updated chart. Please note that the March revision is highlighted in pink.

The next graphic show revisions of the actual data, by year, for 2007 through 2012 and for 2013, projected. The projection is based here on four months results. The patter looks good. If things continue as they have thus far, 2013 will outperform 2010 through 2012.


Herewith a tabulation of average job gains, or losses, per month for the 2007-2013 period:

Year
Average job gain/loss per month in 000
2007
89.8
2008
-293.8
2009
-421.0
2010
85.2
2011
175.3
2012
182.8
2013
195.8

The trend is favorable—if very slow. As of the April results, we have recovered 70.9 percent of total jobs lost in  2008 and 2009. We have 29.1 percent to go.

In April sectors showing small job losses were Mining (3,000), Construction (3,000), Information (9,000), and Government (11,000). Manufacturing neither added nor lost jobs in April. The biggest gainers among the rest Professional and Business Services (up 73,000),  Leisure and Hospitality (up 43,000), and Retail (up 29,300).

Monday, April 15, 2013

Crushed Between Clouds and Insects

An article in the New York Times today suggests that Intel, which got about 84 percent of its revenues in 2012 from PCs and the more muscular servers, has now joined the ranks of major computer companies upset by the maturing of the PC industry (“Intel Looks Past PCs for Foothold”). PC sales have been declining of late; the economy is sluggish, hence corporations and institutions, the major users of that tool, are not investing. But Cloud Computing is on the rise. Cloud computing? The phrase refers to the use distant servers, owned by others, to store an institution’s or enterprises total data “in a cloud.” Cloud servers are simpler and have fewer features than those used by corporations to perform broader computing services, along with file serving, in-house. Therefore they are less profitable. Intel, apparently, finds itself crushed between clouds above and insects (read smartphones and tablets and pads) below; these latter, according to the Times story, rarely incorporate Intel processors.

Why this need to “look past PCs”? The only explanation I can find is pressure on Intel’s stock. The company is magnificently profitable. In the 2007-2012 period, the company’s net income in the worst year, 2009, was 12.4 percent of its net revenues. In 2007 it was 18.2, inn 2012 it was 20.6 percent. This is a company with 53.3 billion in sales (2012) which has grown at a compounded annual rate of 6.8 percent a year 2007 through 2012. There is nothing wrong here except for the bloody market, and I mean the stock market. The market cannot stand a maturing industry. The lady may be but 43 years of age, but as soon as she has shown the first few grey hairs, she is immediately labeled a crone—and we must now “look past” the lady. Here is a chart of Intel’s revenues, net income, and an index of its stock, with 2007 set at 100:

What, if anything is wrong here? Revenue and net income show the consequences of the Great Recession—and the sluggish nature of the recovery. But the stock has responded much more dramatically. And, to be sure, the people who run Intel are not in the computer chip business. They are in the stock market business. Never mind the fundamental value of a corporation that absolutely dominates a market, computing, by owning most of the market share of its most fundamental component, the central processing unit. The same madness also governs the pea-sized brains of almost all those who run publicly traded companies—even one like Food, which can only really grow as population does. That industry has ruined a basic, necessary, and “always will be present” industry by trying to squeeze growth from it by making more and more high-margin prepared foods with too much fat, salt, or sugar—or artificially formulated foods with less of those three than natural foods ought to have.

Ears that hear, eyes that see. But we are lead by the deaf and the blind.

Thursday, April 11, 2013

Revisiting Windows 8

Without much pleasure I note, in a Wall Street Journal article today (“Computer Sales in Free Fall”), that PCs remain in the doldrums—and that lots of people blame Windows 8. I held forth on that subject roughly six months ago (link) and have touched upon the essentially irrelevant war between hand-helds and desk-helds as well. It gives me no pleasure to note what are, deep down, knee-jerk and irrational reactions to markets by various once much admired leaders—like Microsoft, which brought us Windows 8 and Hewlett Packard which is still trying to dump its PC business. Hand-held devices and desktop computers are totally different products and markets. The difference might be described as that between a basket of hand tools on the one and a machine tool on the other hand. The PC market is now mature; the economy is still largely stagnant; hence, what with corporations holding off on purchases, PC sales are declining. But this decline is rooted in the economy’s performance, not in the operating system on the screen of the PCs. Replacing a quite excellent user-interface with a touchy-feely interface people in offices don’t routinely, habitually, use is simply not going to change broad market movements that have zero connection to flim-flam (link).

Here a quote from the WSJ article:

Ricoh Americas Corp., which replaces about a third of its 17,000 PCs every three years and upgrades to the most current operating system available, said this year it is sticking with Windows 7…. Tracey Rothenberger, the company’s chief operating officer, said the benefits of switching to the new software aren’t worth the effort of training employees to use it.

If our business media were innovative—rather than reacting simply to news releases—somebody would stage a trial. Pick a handful of heavy PC users in several companies—you know, the whole ball of wax: spreadsheets, databases, serious text processing like typesetting, and, in the graphics category, artists using Apples with extra-large screens for creating commercial graphics. Select tasks these people do on a certain day and note everything that they do. The next day deploy the same number of heavy iPad users to carry out the identical tasks during the same period of time. I’d love to read the story that would result from this comparison.

Is the PC really going away? I seriously doubt it. Will even the cyber industry mature, and probably quite soon? Most likely. Will the next great market be another of those where you can sell a pound of plastic, silicon, and bits of copper to hysterically-enthused consumers for $395 ever six month? Probably not. The big new markets may turn out to be quite different—and may have nothing to do with electronics.

Saturday, April 6, 2013

Employment Update: March 2013

The unexpected news of very weak gains in employment in March, as reported by the Bureau of Labor Statistics yesterday (link), were actually not quite so dismal. In effect, the BLS revised both January and February result upwards, showing gains of 90,000 jobs (29,000 more in January, 61,000 more in February). This total added to the 88,000 jobs gained in March brings total jobs added, since the last report, to 178,000. Okay. That number also produces a mood a little shy of exuberance but sounds a lot better. Here is the graphic, with January and February shaded in light blue, to indicate revisions, and red showing the weak gain.


The gloom and doom arises because of expectation. The expectations are that the economy will, finally, come roaring back. Finally we shall return to the old Sky’s the Limit, Growth Galore, Don’t Look Back, Spend-Spend-Spend. Well, that certainly isn’t happening. Indeed, as the next graphic shows, right now, projecting three months’ of numbers out to the entire year, we are on a pattern which will make job-growth in 2013 worse than either 2011 or 2012—unless something happens in the next three quarters.


The biggest decline (a loss of 24,100 jobs) came in the Retail sector, indicating that shopping is certainly no longer Job 1. Wholesale Trade, and, yes, Transportation and Warehousing, also came in with job erosions of 1,000 and 2,800 jobs respectively. Manufacturing also lost 3,000 jobs in March. Now, of course, these numbers may well be revised upward next month again, but the overall pattern is not one of the Return of the Good Old days.

There are really three problems here. One is Automation/ Mechanization, which is eating jobs, and we are finally seeing the consequences. The Second is income disparity whereby all of the economy’s gains are being absorbed by the top fifth of the top fifth income quintile. The Third is that our government is no longer willing and able to redistribute income from the 1 percent to the 99 percent. Alas, a strong economy needs masses of confident buyers.

Almost overlooked in yesterdays news coverage was that the unemployment rate remained at 7.6 percent—and that because, once more, people were voting themselves out of the labor pool by stopping to look for work. People who give up—because they cannot see any jobs—will make the unemployment number look good, sort of, but they are not shopping either.