If Obama is losing Chicago...

...you know things must be bad.

Steve Jobs Tells It Like It Is

I just love that guy:

On Google: We did not enter the search business, Jobs said. They entered the phone business. Make no mistake they want to kill the iPhone. We won’t let them, he says. Someone else asks something on a different topic, but there’s no getting Jobs off this rant. I want to go back to that other question first and say one more thing, he says. This don’t be evil mantra: “It’s bullshit.” Audience roars.

Much more, including his thoughts on Adobe and others, can be found here.

Body Bombs

DailyMail.com:

Britain is facing a new Al Qaeda terror threat from suicide ‘body bombers’ with explosives surgically inserted inside them.
Until now, terrorists have attacked airlines, Underground trains and buses by secreting bombs in bags, shoes or underwear to avoid detection.
But an operation by MI5 has uncovered evidence that Al Qaeda is planning a new stage in its terror campaign by inserting ‘surgical bombs’ inside people for the first time.

Gives the phrase "blonde bombshell" a whole new meaning, I suppose.

Climate Chaos

Telegraph:

The revelation will cause fresh embarrassment for the Intergovernmental Panel on Climate Change (IPCC), which had to issue a humiliating apology earlier this month over inaccurate statements about global warming.
The IPCC's remit is to provide an authoritative assessment of scientific evidence on climate change.

In its most recent report, it stated that observed reductions in mountain ice in the Andes, Alps and Africa was being caused by global warming, citing two papers as the source of the information.

However, it can be revealed that one of the sources quoted was a feature article published in a popular magazine for climbers which was based on anecdotal evidence from mountaineers about the changes they were witnessing on the mountainsides around them.

The other was a dissertation written by a geography student, studying for the equivalent of a master's degree, at the University of Berne in Switzerland that quoted interviews with mountain guides in the Alps.

The revelations, uncovered by The Sunday Telegraph, have raised fresh questions about the quality of the information contained in the report, which was published in 2007.
It comes after officials for the panel were forced earlier this month to retract inaccurate claims in the IPCC's report about the melting of Himalayan glaciers.

Europe on the Brink:

Greece benefitted from being in the Eurozone by getting very low interest rates, up until recently. Being in the Eurozone made investors confident. Now that confidence is eroding daily. And this week's market action says rates will go higher, without some fiscal discipline. To help my US readers put this in perspective, let's assume that Greece was the size of the US. To get back to Maastricht Treaty levels, they would need to cut the deficit by 4% of GDP for the next few years. If the US did that, it would mean an equivalent budget cut of $500 billion dollars. Per year. For three years running.

That would guarantee a very deep recession. Just a 10% suggested pay cut has Greek government unions already planning strikes. Nevertheless, the government of Greece recognizes that it simply cannot continue to run such huge deficits. They have developed a plan that aims to narrow the shortfall from 12.7% of output, more than four times the EU limit, to 8.7% this year. That reduction will be achieved even though the economy will contract 0.3%, the plan says. The deficit will shrink to 5.6% next year and 2.8% in 2012.

The market is saying they don't believe that will happen. For one thing, if the Greek economy goes into recession, the amount collected in taxes will fall, meaning the shortfall will increase. Second, it is not clear that Greek voters will approve such a plan at their next elections. Riots and demonstrations are a popular pastime.

Both French and German ministers made it clear that there would be no bailout of Greece. But here's the problem. If they ignore the noncompliance, there is no meaning to the treaty. The euro will be called into question. And the other countries with serious fiscal problems will ask why they should cut back if Greece does not. If Greece does not choose deep cutbacks and recession, the markets will keep demanding hikes in interest rates, and eventually Greece will have problems meeting just its interest payments.

Can this go on for some time? The analysis of debt crises in history says yes, but there comes a time when confidence breaks. My friends from GaveKal had this thought:

"What is the next step? Having lived through the Mexican, Thai, Korean and Argentine crises, it is hard not to distinguish a common pattern. In our view, this means that investors need to confront the fact that we are at an important crossroads for Greece, best symbolized by a simple question: 'If you were a Greek saver with all of your income in a Greek bank, given what is happening to the debt of your sovereign, would you feel comfortable keeping all of your life savings in your savings institution? Or would you start thinking about opening an account in a foreign bank and/or redeeming your currency in cash?' The answer to this question will likely direct the next phase of the crisis. If we start to see bank runs in Greece, then investors will have to accept that the crisis has run out of control and that we are facing a far more bearish investment environment. However, if the Greek population does not panic and does not liquefy/transfer its savings, then European policy-makers may still have a chance to find a political solution to this growing problem.

"What could a political solution be? The answer here is simple: there is none. So if Europe wants to save Greece from hitting the wall towards which it is now heading, the European commission, the ECB and/or other institutions (IMF?) will have to bend the rules massively. In turn, this will likely lead to a further collapse in the euro.

Read the whole thing, including an explanation as to why this time is not different.