China faces urban challenge

Shanghai now has twice as many skyscrapers as New York

To write about urbanisation in China is to traffic in superlatives.

Three decades of sustained economic growth, concentrated along the booming coast, has lured millions from the impoverished Chinese countryside. This great migration - unprecedented in human history - has put 46 Chinese cities over the one million mark since 1992, out of a national total of 102.
And this is just the start.

 

Currently only about 40% of China's population lives in cities, roughly that of America in 1885.

It is estimated that another 350 million Chinese will become urban by 2025, raising China's urban numbers to a cool billion.
Accommodating all these people has meant building on a scale the world has never seen before.
In the first 20 years of China's economic revolution, begun under Deng Xiaoping in the late 1970s, China built some 6.5bn sq m (70bn sq ft) of new housing - the equivalent of more than 150 million average-sized apartments.
In Shanghai there were no skyscrapers in 1980; today it has twice as many as New York. Between 1990 and 2004 developers erected 85m sq m of commercial space in the city - equivalent to 334 Empire State buildings.
Nationwide, China's construction industry employs a workforce of about 37 million.
Nearly half the world's steel and cement is devoured there, and much of the world's heavy construction equipment has relocated to the People's Republic. Tower cranes, for example, have become the ubiquitous symbol of urban China.
'Spreading pancake'
But China's urban revolution has also destroyed as much as it has built.

Qianmen Street in one of Beijing's oldest neighbourhoods is now a tourist attraction

In its head-long rush to be rich and modern, China has deprived itself - and the world - of a priceless heritage.
Beijing, once among the world's great urban treasures, is fast becoming just another node of globalised consumerism; full of absurdly sanitised reconstitutions of its lost past, unaffordable to working people, lacerated by eight-lane highways.
Urban development in China has also displaced more people than any nation in peacetime.
In Shanghai alone, redevelopment projects in the 1990s displaced more residents than did 30 years of urban renewal in the United States.
Because China's cities are growing outward as well as upward, urbanisation has also consumed a staggering amount of rural countryside.
Between 1985 and 1995, Shanghai's footprint grew from 90 sq miles to 790.
The "spreading pancake" of urban growth in China - "tan da bing", the popular Chinese expression for sprawl - has devoured some 45,000 sq miles of productive farmland over the last 30 years, nearly half the land area of the United Kingdom.
Chinese suburban development is much more concentrated than in the US. Large detached homes owned by single-families - the American standard - are relatively rare.

China's domestic automobile market now exceeds America's

The basic unit of Chinese suburbia - with its mid-rise apartment towers, community centre and shared public spaces - is half way between a Maoist "dan wei" (work unit) and a Californian gated community.
Nonetheless, such development on the urban periphery is fast making China a nation of motorists.
China's domestic car market now exceeds America's, and the largest car showrooms in the world today are not in Los Angeles or Houston but the People's Republic.
Accommodating the steady flow of new cars - Beijing and Shanghai average 1,000 new vehicle registrations a day - is a national road network on the verge of eclipsing the American interstate system as Earth's most extensive human artefact.
And with cars and highways have come all the standard spaces of suburban consumerism - drive-through restaurants and big-box shopping malls, budget chain motels, and even that vanished icon of middle America, the drive-in cinema.
Saving the world
None of this bodes well for planet Earth. How ironic that, just as the West has begun to get its environmental house in order - finally taking serious action to reduce its carbon footprint, combat global warming, and end its oil addiction - here come the millions of China, wanting the very lifestyle and material amenities that have put us on the verge of environmental collapse.

China has invested billions of dollars in the clean energy industry in recent years

If China were to match, per capita, car ownership in the US (which is falling, incidentally), it would mean more than one billion cars.
The planet, in a word, would be fried.
And this takes no account of India, which will soon overtake China as the world's most populous nation.
Experts such as Paul Gilding have come up with a measure for our total global footprint in terms of our impact on the environment and resources. In his book The Great Disruption he concludes that our economy is operating at about 150% of capacity - in other words, the way we live will take between one-and-a-half planets to sustain.
That is not just unsustainable, it is a catastrophe.
And yet, who are we to say to China: "We've had our playful, wasteful day in the sun but you must now conserve."
Happily, we don't need to; the Chinese are saying it themselves.
Even as it sprawls, China is building more public transit than all other nations combined, and is well ahead of the US in developing sustainable building technologies and clean-energy alternatives such as solar, wind, and biomass.
According to a study by the Pew Charitable Trusts, China invested $34.6bn (£21bn) in the clean energy industry between 2005 and 2009 - nearly twice that of the US.
We may have taught China to drive, eat, and buy its way to ruin; China may yet show us how to save the world.

The Next Financial Crisis Will Be Hellish, And It’s On Its Way

There is definitely going to be another financial crisis around the corner,” says hedge fund legend Mark Mobius, “because we haven’t solved any of the things that caused the previous crisis.”
We’re raising our alert status for the next financial crisis. We already raised it last week after spreads on U.S. credit default swaps started blowing out.  We raised it again after seeing the remarks of Mr. Mobius, chief of the $50 billion emerging markets desk at Templeton Asset Management.
Speaking in Tokyo, he pointed to derivatives, the financial hairball of futures, options, and swaps in which nearly all the world’s major banks are tangled up.
Estimates on the amount of derivatives out there worldwide vary. An oft-heard estimate is $600 trillion. That squares with Mobius’ guess of 10 times the world’s annual GDP. “Are the derivatives regulated?” asks Mobius. “No. Are you still getting growth in derivatives? Yes.”
In other words, something along the lines of securitized mortgages is lurking out there, ready to trigger another crisis as in 2007-08.
What could it be? We’ll offer up a good guess, one the market is discounting.
Seldom does a stock index rise so much, for so little reason, as the Dow did on the open Tuesday morning: 115 Dow points on a rumor that Greece is going to get a second bailout.
Let’s step back for a moment: The Greek crisis is first and foremost about the German and French banks that were foolish enough to lend money to Greece in the first place. What sort of derivative contracts tied to Greek debt are they sitting on? What worldwide mayhem would ensue if Greece didn’t pay back 100 centimes on the euro?

Is Bernanke Failing His Fed Mission Or Just Delusional?

In his June 7 speech, Fed Chairman Ben Bernanke stated, “the best way for the Federal Reserve to support the fundamental value of the dollar in the medium term is to pursue our dual mandate of maximum employment and price stability, and we will certainly do that.”
It is instructive to take a look at the actual Federal Reserve goals, as well Bernanke’s results in pursuing those goals.
Goals of Monetary Policy
“The goals of monetary policy are spelled out in the Federal Reserve Act, which specifies that the Board of Governors and the Federal Open Mar­ket Committee should seek ‘to promote effectively the goals of maxi­mum employment, stable prices, and moderate long-term interest rates’.  Stable prices in the long run are a precondition for maximum sustainable output growth and employment as well as moderate long-term interest rates.
When prices are stable and believed likely to remain so, the prices of goods, services, materials, and labor are undistorted by inflation and serve as clearer signals and guides to the efficient allocation of resources and thus contribute to higher standards of living. Moreover, stable prices foster saving and capital formation, because when the risk of erosion of asset values resulting from inflation—and the need to guard against such losses—are minimized, households are encouraged to save more and busi­nesses are encouraged to invest more.”

Let’s look at the results of Bernanke’s economic “fine tuning” (using data from the St. Louis Fed’s database, starting in February, 2006, through April 2011), and see if he has successfully pursued this mandate.
Definition of STABLE (from the Mirriam-Webster dictionary)
a : firmly established : fixed, steadfast <stable opinions>
b : not changing or fluctuating : unvarying <in stable condition>
c : permanent, enduring <stable civilizations>
Stable Prices?
Stable prices are one of the Fed’s primary mandates.  In the table below, take a look at what has happened to the prices of items in a typical U.S. consumer’s budget since Ben took the reins:
Feb ’06 – April ’11

Items in a Typical Budget	% Change
Food and Beverages	16.54%
Water and sewer and trash collection services	31.88%
Rent of primary residence	13.82%
Housing	8.68%
Fuels and Utilities	11.93%
Apparel	4.83%
Medical Care	20.11%
Gasoline (all types)	65.12%
Transportation	23.36%
Tuition, other school fees, and childcare	29.28%
Recreation	2.87%

It is easy to play with the weightings of the above prices, and see how individual budgets would be impacted.  Regardless of the method used to look at prices, it is clear that Bernanke has not been successful at maintaining price stability since taking over as Fed Chairman.  Mandate not accomplished.
Maximum or Full Employment
Finding a strict definition of maximum employment is impossible.  Many economist give different estimates, ranging from 2%-7%.  The standard unemployment rate most often used by the Fed is currently at 9.1%, up 90% since Bernanke started.  The more inclusive (realistic) U6 number stands at 15.8%, up 75% in the same period.  The Civilian Participation Rate has declined 2.87% to 64.2%.
This is the lowest level the U.S. has seen since March, 1984.  The decline amounts to 8,946,844 fewer Americans in the labor force.  Had they not dropped out because of a lack of jobs, the “official” unemployment rate would be significantly higher.  While we can debate the meaning of the term maximum employment, it is clear that the jobs data has deteriorated considerably since Bernanke took the reins at the Fed.  Mandate not accomplished.
Moderate Interest Rates
While not stated in Bernanke’s recent address, the Fed’s website also posts “moderate interest rates” as a stated goal.  While we cannot definitively say what constitutes “moderate”, we do know that both short and long-term interest rates are near all time lows.  It is safe to assume that near record low rates are not “moderate”.  Further, when  interest rates are artificially held below the rate of economic growth,” financial repression” is occurring.  Many bright folks have commented on how the zero interest rate policy (ZIRP) is destructive to savers and misallocates resources.  It is safe to say that this mandate has not been accomplished.
In conclusion, it is evident that Ben Bernanke is failing his mandates.  We believe it must come down to one of the following reasons:
1.       Bernanke does not know how to achieve his mandates;
2.       The policy tools employed don’t work;
3.       He does not have the ability to implement policies that would work;
4.       He is not trying to achieve his mandates;
5.       He has goals other than his legal mandates;
6.       He does not look at the data, and believes he is succeeding.
We will leave it up to our readers to make their own conclusions.

Solar Heats Up in Saudi Arabia

audi Arabia is the newest and hottest solar power market to attract the attention of emerging leaders in the solar-energy space.

Solar Frontier, a start-up company based in Tokyo, Japan selling leading-edge solar CIS technology, is opening an office in Khobar, Saudi Arabia to strengthen its position in the emerging solar-power market in the Middle East, which it has described as a strategic priority for long-term growth.

“The Al Khobar office will play a key role in expanding our overall presence in Middle Eastern growth markets,” said Atsuhiko Hirano, Solar Frontier’s VP of marketing and power generation projects. “Solar Frontier’s CIS solar modules are proving durable in the most extreme conditions.”

Solar CIS, which stands for copper, indium and selenium, are solar photovoltaic (PV) modules that leverage the latest developments in thin-film technology. CIS panels are built with light-soaking technology that allows them to perform better in shade and under high temperatures compared to crystalline and other conventional PV panels.
Meanwhile, Solar Frontier is currently completing construction of the world’s largest solar CIS production facility in Miyazaki, Japan, which will be able to produce a whopping 900 megawatts (MW) of solar CIS systems annually when it comes online later this year.
Saudi Arabia’s demand for electric power is rising rapidly amid a demographic explosion which will likely sustain high levels of demand growth for years.  Thus Solar Frontier’s decision to put boots on the ground to push Solar Frontier’s CIS technology, which has a lower temperature coefficient than crystalline silicon and is thus well suited for the region’s naturally high levels of solar insolation. As seen in the map showing estimated levels of solar radiation in the world below:

The new office in Saudi Arabia will open on July 1st and will support Solar Frontier’s projects in Saudi Arabia, which include the a 10 MW solar installation at Abdullah University of Science and Technology installation, a 500 MW power plant and a joint venture with Saudi Aramco for a 10 MW solar park.
“Solar Frontier has the capacity to meet the challenging Middle East environment and huge potential demand for solar energy in the region,” said Hirano.

The Crisis of America’s Uncounted Unemployed

 

Sigmund Freud said, “Illusions commend themselves to us because they save us pain and allow us to enjoy pleasure instead.” Many Americans and most political leaders at the federal and state levels want to believe in our “official unemployment rate.” The official rate gives no pleasure, but it is less painful than the actual rate.
Unemployment is the most significant obstacle in the way of our nation’s economic viability. It is a difficult problem, and many politicians simply don’t understand its cause or avoid tackling it for fear of failing. The best solutions are not popular with lobbyists, unions or corporations, and to implement them would cost politicians the financial support they desperately need to get reelected.
According to the U.S. Department of Labor’s official unemployment rate for May, 9.1% of the nation’s labor force, or approximately 13.9 million people, are unemployed. To get a sense of the magnitude of that number, add together the entire populations of the nation’s two largest cities, New York and Los Angeles, and you will still be short by over 1.7 million people, or roughly the populations of Philadelphia and Orlando.
Equally significant is a fact that most politicians do not acknowledge, realize, or even discuss the fact that the official unemployment rate doesn’t include Americans who have dropped out of the market or those who are underemployed. Though the math may be fuzzy, the method is like a magical act. Hocus-pocus—a wave of a wand—and millions of unemployed and underemployed workers vanish.
Magicians have made elephants, horses, and tigers disappear, and David Copperfield even made a national icon and symbol of freedom, the Statue of Liberty, vanish. But those illusionists are amateurs compared with the federal government, which can make millions of Americans vanish. The official unemployment rate would be considerably higher if it were still calculated as it was before the Clinton administration, when “discouraged workers” were included.
Discouraged workers are those who are not currently looking for a job because they feel their search would be in vain. Many of them are members of minority groups or are 50 or older. “Marginally attached” workers are also excluded in the official unemployment rate. They are people who want and are available for jobs and recently searched for work but aren’t currently looking because of problems with things like child care or transportation costs. With gas prices rising and wages dropping, this category can be expected to grow. Also excluded are part-time workers who seek full-time work.
The Labor Department’s most comprehensive unemployment rate (U-6), which includes the above categories, is 15.9%, or approximately 24 million people. That is 10.6 million more Americans than are counted by the official unemployment rate.
Again, to gain perspective, 24 million people is equivalent to the entire population of the nation’s nine largest cities—New York, Los Angeles, Chicago, Houston, Philadelphia, Phoenix, San Diego, San Antonio, and Dallas. During the height of the Great Depression in 1933, 12.8 million people were unemployed, or about 24.7% of the nation’s labor force.
If we are to adjust the direction in which the nation is moving, we must first take an honest look at where we are, starting with a truthful assessment of unemployment. Our political leaders must stop their ceaseless and shameless fundraising and pandering to special interests and address issues that will build the future for all Americans. We need a tax system that works for all Americans, along with a trade policy that allows us to be a strong global competitor in a manner that will not sacrifice our jobs.
Freud may be correct about illusions. In this case, however, the reality is that without jobs America will not be able to maintain a reasonable standard of living or generate the taxes to secure our national security.
If hocus-pocus is the order of the day, the American dream may become an illusion.

Ronald R. Pollina, a geoeconomist, is the author of the Pollina Corporate Top 10 Pro-Business States Study, which is published annually by Chicago-based Pollina Corporate Real Estate. This article is adapted, in part, from Selling Out a Superpower: Where the U.S. Economy Went Wrong and How We Can Turn It Around, with the permission of Prometheus Books.

Obama Heads to Rio Sunday; Maximum Security Awaits

The famous sidewalk along Copacabana Beach in Rio de Janeiro. President Obama heads to Brazil on Saturday and will speak in public in Rio on Sunday.

President Barack Obama will take his first official trip to Brazil this weekend where he will speak in the popular Cinelandia Square in downtown Rio de Janeiro. Access, of course, will be tightly restricted and security measures so secretive that not even the Embassy or US Consulate in Rio know exactly how it’s all going to go down. Obama’s speech will be free and open to the public and take place around 15:00 local time (14:00 EST). Access to the square will begin at 11:30, and is sure to draw a crowd. Obama is popular in Brazil. One politician seeking office in Rio actually changed his name to Barack Obama in 2008 to solicit votes. He didn’t win.

The Obama family will also take in the sights in Rio. A trip to Corcovado mountain, where the Christ the Redeemer statue stands (France gave us Lady Liberty, gave Brazil Jesus) is supposedly on the itinerary. What trip to Rio would be complete without it? If they do make it to the top of the mountain, they will do so with an entourage of secret service and Brazil’s Elite Squad, known as BOPE.

Where Rich Chinese Are Buying Real Estate

Vancouver, London and the big cities down under are second homes of choice for China’s super rich, according to real estate services firm Colliers International.
One of the reasons the China real estate market is so hot is because wealthy Chinese are buying up property to hold onto real assets, rather than put money in low yielding bank bonds and volatile equities. The super rich are buying real estate outside of China in an effort to avoid taxes.

In the past six months, Chinese spent 1.3 billion yuan ($200 million) through Colliers’ international property department, with Canada, the UK and Australia topping list.  “We are expecting a clear increase in the extent of mainland buyers’ purchases of overseas properties this year because of the government’s rigorous restraint on the number of homes a family can buy in key cities,” Alan Liu, managing director of Colliers International, said in China Daily Tuesday.

Chinese demand has pushed the average price of a Vancouver home up 12% in 2010 and is expected to rise another 3% this year, according to the Canada Mortgage and Housing Corporation. Demand from mainland immigrants now accounts for 29% of all new homes in Vancouver, China Daily reports.
In London, China buyers accounted for 28% of all prime London property sales and 54% by sales value in the prime central London area, where houses go for 5 million pounds ($8 million) on average, according to a recent report by Savills research.
“If the money from China were to start flowing into London at the same rate it does from billionaires in other countries, we would expect the value of ultra-prime London properties to grow by as much as 15%,” Yolande Barnes, head of Savills residential research told China Daily. “The issue at present is that Chinese buyers aren’t taking, or can’t take, their money out of China.”
The biggest increase in global billionaires since 2007 has occurred in China and Russia. The oligarchs from the old USSR account for 15% of prime London real estate by value.  Chinese billionaires have yet to have a real impact, accounting for just 3% so far, but that is expected to change as China’s uber-rich discover new ways to invest offshore.

Jon Huntsman Sees Big Trouble In China

UPDATE: Jon Huntsman entered his party’s 2012 presidential race on Tuesday pledging to make the “hard decisions” to deal with America’s debt.

It’s a toss-up whether Jon Huntsman is better known as the former governor of Utah or as the Republican who President Obama appointed as his Ambassador to China.

Fact of the matter (and somewhat disturbingly), Huntsman is perhaps best known as the guy who introduced Sarah Palin at the 2008 Republican National Convention. (“Hockey moms, unite!”)

Straw polls notwithstanding, only 35 percent of Republicans have even heard of Huntsman—and 36 percent of those voters said there was no chance they would vote for him.

Still, Huntsman, who will make his run for the White House official tomorrow, could be a viable GOP contender, albeit a long shot at this writing.

I’m not sure if his comments on China help. Huntsman predicted “major problems” ahead for China, as a rising standard of living increases awareness of political oppression and intensifies resistance to the government’s control.

As reported by The Huffington Post, Huntsman made the comment in a private conference call with university students across the U.S.
“There’s still that great divide between the economic class and the political class,” Huntsman said, according to a recording of the call obtained by HuffPo. “And at some point, as you get 300 and 400 million people who now become members of what will be the largest middle class in the world, they’re going to have to make some really tough choices about how you bridge the economic and the political chasm, which is not easily done.”
“If they don’t do it, they’re likely to have some sort of head-on collision, I would say four or five years into the future.”
While China’s economy has become more open, Huntsman said, the country’s internal political system lags far behind.

You can read the rest of Huntsman’s published comments here.

Is This The Girl That Hacked HBGary?

Next time you see a flock of teenage girls in the mall, note that one of them might be Kayla. As your average 16-year-old, she regularly hangs out with friends, works part time at a salon and hopes one day to be a teacher.

Behind the scenes though, she’s a big time supporter of Anonymous, the loosely knit global hacking group that brought down the Web sites of MasterCard and PayPal in defence of WikiLeaks. That’s what she claims at least. Kayla flits around the web with so covert an identity that I cannot fully verify her age or gender.

Still, the girl known on chat forums as ‘k, and who spoke to me by e-mail as “Kayla,” is no figment of the Internet’s imagination: she helped all but destroy a company. When Aaron Barr, the now-former CEO of software security firm HBGary Federal, claimed in a press report that he could identify members of the Anonymous collective through social media, she and four other hackers broke into his company’s servers in revenge, defacing his Web site, purging data and posting more than 50,000 of his emails online for the world to see, all within the space of 24 hours.
Kayla played a key role, at one point posing as HBGary CEO Greg Hoglund to an IT administrator to social engineer access to his website rootkit.com. Read their email correspondence here and here. In the fallout, Barr’s emails revealed HBGary had proposed a dirty tricks campaign against WikiLeaks to a law firm representing Bank of America. Other security firms distanced themselves. Kayla and her buddies had opened a can of worms.

Today while HBGary picks up the pieces, Kayla still spends a few hours a night on Anonymous chat channels looking for her next target. Most recently it was the Libyan government, helping get information to Libyan citizens in the Internet blackout.

With just half a dozen close friends online, she has a strict regimen to remain invisible on the web. Each night she wipes every one of her web accounts and deletes every email in her inbox.  She has no physical hard drive and boots her computer from a microSD card. “I could hide this card anywhere or chew into a million pieces in a few seconds,” she says by e-mail. She keeps her operating system on a USB stick and uses a virtual machine (VM) to carry out her online shenanigans.
So paranoid is Kayla of being caught or hacked by others, that despite several requests she would not speak to me on Skype to verify an adolescent-sounding voice. Our only evidence: others in Anonymous vouch for her age, her emails are punctuated with smiley faces and “lols” and she is relatively well-known on hacking forums. Still, rumors abound that Kayla is a mid-20s male from New Jersey named Corey Barnhill, who also goes by the pseudonym Xyrix.
When I put this to Kayla she countered that in 2008 (aged 14) she and a few other users of an early Anonymous IRC network called partyvan, hacked the account of fellow user Xyrix in defence of an online friend. Kayla used Xyrix’s (Corey’s) account to social engineer an IRC operator and got her target’s personal information. The operator thought Xyrix was Kayla, added her to Xyrix’s Encyclopedia Dramatica page, and the rest is history.

How did this mystery girl become a hacker? Kayla says that’s down to her dad, a software engineer who won custody over her after a divorce that deemed him the “more stable parent.” They moved to the countryside where others her age were few and far between. The house was meanwhile littered with programming books on Linux kernel, Intel manuals and networking. “I just started reading them,” she says. By the time Kayla was 14 she could fully program C and x86 assembly.

“My dad encouraged it at first,” she says. “He thought it was awesome I was so in to what he did.” Dad allegedly showed her how to find bugs in C source code and exploit them. It was all harmless and Kayla had only been using the Internet to talk to friends on MSN. But she began looking into hacking, and learned scripting languages like Perl, Python and PHP, figuring out how to use databases like MySQL and how to attack them using SQL injection.

She registered at a few online hacking forums but was snubbed because of her age–apparent because in the early days she gave her personal details when registering. “Fair enough I was only 14 but it made me so angry,” she says. She took revenge by hacking into the forums themselves and disrupting things, impressing some of the users–though things got weird when one or two developed crushes.
Then an older male user that she hacked into hit back by digging up her e-mail address and phone number from old MSN information that was still on the web. He called her house and threatened to contact the police. Upon realizing how he’d got her details–it was “like a slap in the face”–Kayla did everything she could to scrub the web clean of her identity.
In December 2008, she wrought havoc on one of the most famous forums of all, 4chan’s notorious /b/ channel, finding and exploited an SQL injection bug on its content management system, hacking in and causing mayhem on the forum for a few hours.
Meanwhile, Anonymous was emerging from that very online community to become the gateway to pseudo-political activism it is today. Earlier that year in January 2008, many of its users gathered on 4chan to hack the Church of Scientology after it tried to remove a controversial video of Tom Cruise on YouTube.
Kayla eventually found her way onto the Anonymous IRC, partyvan. “I just went along with everyone else and used Internet magic to generate lulz,” she says. Anonymous at first was causing trouble online for fun, hacking other hackers and trolls (folks who post spurious comments on forums) and posting their private messages online. “It was all good fun.”
While other people her age were browsing Facebook, Kayla was advancing her programming skills, memorizing Windows Opcodes and scouring source code for exploitable bugs, learning off information that was freely available on the Internet.

Eventually, she joined Anonymous’ Operation Payback and helped launch distributed denial of service (DDoS) attacks against  an Indian company that was DDoS-ing bittorrent site Pirate Bay. “I never really cared for politics and such until I started hanging round the Payback IRC,” she says. “I started to see the world for the corrupt mess it really is. A world where politicians and corporations could bend the rules and laws to suit their own needs.”

These days Kayla’s dad is aware of her activities with Anonymous, and while he is concerned about the legal implications–she lives in a country where she could be tried as an adult–she says he finds the whole thing “hilarious.”
Meanwhile she refuses to be chained to her computer, limiting herself to a few hours a night online. She rarely visits online forums–they’re “boring”–and a few days a week takes a course in college to further her goal of being a teacher. She lives in an English-speaking country–not the U.K.–but won’t say more about it.
Kayla is understandably cagey. Spokespeople for Anonymous have been defending the group against accusations that its DDoS-ing and hacks are illegal, claiming such activities instead represent civil disobedience. But the hunt for its members is growing: on top of an ongoing FBI investigation, the Pentagon recently ordered its own probe after supporters of Anonymous disrupted the online activities of a military base in Virginia where Private Bradley Manning, the U.S. soldier accused of giving secret documents to WikiLeaks is being held.

Anonymous’ supporters like Kayla may now have a sense of political purpose, but they can’t seem to shake their youthful hunger for “lulz,” the fun that comes with causing trouble to others, merited or not. That means they’ll continue to be unpredictable, passionate, and quite possibly a flash in the pan, but you’ll be hard pressed to ever find out who they are.

Why Did Nokia Launch The N9 Meego Phone?

Nokia this morning unveiled a great looking, all-screen smartphone called the N9 which promises to be its most powerful device yet. Thanks to its Meego/Qt software cocktail it has a more intuitive user interface than previous offerings from the world’s biggest device maker, and it looks impressive.
But you might be wondering: if Nokia is working with Microsoft to run Windows on its future smartphones, why release a Meego phone?

Nokia's new N9 smartphone

The issue isn’t so much with the phone, but with the ecosystem. There isn’t much of one relative to Apple‘s and Android’s, or the one Nokia and Microsoft are collectively cultivating for Window Phones. Nokia dragged its feet in building up a community of developers around Meego, and now that it has the lovely N9 running on Meego Harmattan, an open sourced operating system with Nokia’s user interface on top, there isn’t much choice for users who want to buy and customize apps.
Sure, it’ll come pre-loaded with some apps and there’s always the Ovi Store for more, but the store’s future is uncertain the wake of Windows Marketplace. Nokia has meanwhile been laying off thousands of software engineers so that it can transfer R&D to Microsoft, so there won’t be much in-house support for the Meego apps and services. Some might see the N9 as a waste of money with no ecosystem in place.
So why bring out a Meego phone at all?

• Learning. Both Nokia’s head of design Mark Ahtisaari, and smartphone marketing exec Ilari Nurmi answer this question in the same way: Nokia wants to “learn” from its new Meego-based device. When pressed to elaborate, Nurmi answered, “Let’s see what we are going to learn” while Ahtisaari said they would “Learn, then refine, then continue. The key thing is to show we can innovate on top in a way that is uniquely Nokia.”  When asked what “uniquely Nokia” was, he answered, “designed for true mobility.” So Nokia wants to watch how people buy and use the N9 to learn how to design better phones–not just hardware for Microsoft, but future smartphones where it might also design the user interface.
• Showing. Nokia is showing the industry it can make a disruptive phone that successfully marries hardware and software . “It’s about proving a point to industry watchers and consumers,” says Gartner’s Carolina Milanesi. It might also prove a point to Microsoft. We don’t know all the details of Nokia’ partnership with Microsoft on Windows Phone, but if the the N9 sells well that could strengthen its position as a licensee to Redmond, helping further differentiate itself from other device makers like Samsung, HTC and Dell. The N9 is Qt enabled, and Qt as a user-interface framework is more popular among developers than Meego. So think of Qt as the future here. Nokia said today that Qt would be core to “bringing applications to the next billion users.” That suggests Qt will come to the lower end Series 40 platform, and it would be weird for it not to be available for Windows Phones eventually too. Nokia has said nothing of this, but if Qt was brought to high-end (Meego), mid-range (Windows) and lower (S40) phones, that could give it a handle back on software and further differentiation. Today’s announcement gave some confidence to investors too: Nokia’s shares were up 2% this morning in Helsinki.
• Customers. Developers and apps are important, but look where Nokia is announcing the N9 today: Singapore. While mobile users in Asia do download apps and software service, they don’t do so nearly as much as their Western counterparts. “Customers in Asia still value hardware as a key factor,” says Milanesi. “There’s demand for apps but it’s not the main reason for a customer to buy a phone.” They are more interested in the design, form factor and megapixels of the camera.

The new Nokia N9

We only know a little about the dynamics of Nokia’s relationship with Microsoft on Windows Phone. We don’t know what kind of freedom Nokia will have as a licensee to do things differently from the likes of HTC and Samsung. But Nokia’s past work on Meego and future development of Qt could give it extra bargaining power in its relationship with Windows.
“This can go either way,” says Milanessi, adding that it doesn’t always matter what a phone’s operating system is. “It proves the point that Nokia gets it and they can create devices that have a rich experience.” If they end up doing so on a platform like Windows then perhaps all the better.

Wal-Mart women denied discrimination class action

The US Supreme Court has ruled that a group of women claiming discrimination against US retail giant Wal-Mart may not seek a class action lawsuit.

The court ruled that women who said they were paid less because of their gender must pursue legal action individually.
Plaintiffs had sought to unite more than a million women in their effort.
Wal-Mart denied the accusation and said female employees across the US had no grounds for a class action.
'Literally millions'
On Monday, the court overturned a ruling by a lower appeals court that 1.5 million women who had worked at Wal-Mart retail stores could unite in the class action suit.
The women, led by a group of named plaintiffs, sought back pay and punitive damages for the class of women, saying the company passed female employees over for promotion and paid them less.

 

Their suit relied on statistical evidence about pay disparities between male and female employees and anecdotal reports of individual cases of discrimination.

The court ruled that the women could not show common "questions or law or fact" that held for all the women in the proposed class (any woman who has worked for one of more than 3,400 Wal-Mart stores in the US since December 1998).
"Here, [the group of women employees] wish to sue about literally millions of employment decisions at once," Justice Antonin Scalia wrote.
"Without some glue holding the alleged reasons for all those decisions together, it will be impossible to say that examination of all the class members' claims for relief will produce a common answer to the crucial question 'why was I disfavoured.'"
Mr Scalia also noted that Wal-Mart's written policy did not allow gender discrimination, and did not have any testing procedure or evaluation method that could be shown to be biased.
The BBC's Paul Adams says plaintiffs can still pursue their claims individually, but the implications for Wal-Mart would obviously be much less significant than a suit which could have cost one of the world's biggest private companies billions of dollars.
Management disparity
In a dissenting opinion, the court's four liberal justices agreed the Wal-Mart case did not merit a class action, but would have taken a less narrow view of the requirements for a class action suit over back pay.

Source: The Impact Fund (one of seven legal firms working for the plaintiffs)

"The dissenters... are more favourably inclined to class action lawsuits," Tom Goldstein, who has argued 24 cases before the Supreme Court, told the BBC.

"They would not close the door to big suits like this so easily, whereas the majority is very concerned about the company's ability to defend itself against each employee."
Justice Ruth Bader Ginsburg, who wrote the dissent, noted that 70% of positions paid by the hour in the retailers' stores are women, but that women hold only 33% of management roles.
"The plaintiffs' evidence, including class members' tales of their own experiences, suggests that gender bias suffused Wal-Mart's company culture," Ms Ginsburg wrote.
She was joined by the two other women on the court, Justices Sonia Sotomayor and Elana Kagan, and Justice Stephen Breyer.

Top 25 most valuable brands in the world

Twelve Chinese brands, including China Mobile, ICBC Asia and China Construction Bank, are ranked among the top 100 most valuable brands in the world by an annul list published Monday by global brands agency Millward Brown.

Other Chinese brands on the list include Baidu, China Life, Bank of China, Agriculture Bank of China, Tencent, PetroChina, China Ping An, China Telecom, and China Merchants Bank.

In this year's ranking, the 6th edition of BrandZ Top 100 Most Valuable Global Brands, Apple overtakes four-year champion Google as the world's most valuable brand.

The total value of the top 100 brands rose by 17 percent to $2.4 trillion, as the global economy shifted to growth.

Millward Brown takes as a starting point the value that companies put on their own main brands as intangibles in their earnings reports.

It combines that with the perceptions of more than 2 million consumers in relevant markets around the world whom it surveys over the course of the year, and then applies a multiple derived from the company's short-term future growth prospects.

Is Sino-Forest a Sino-Fraud?

At the moment, analysts in Asia are busy counting acres of plantation in China’s Yunnan province.  On June 2, Muddy Waters, a short-selling firm, sent the stock of Toronto-listed Sino-Forest Corp. tumbling after charging the Chinese company with substantially misrepresenting its rights to timber acreage—and massively overstating revenues.  As a result, Sino-Forest’s stock price has fallen 75%.  The reaction was sharp in part because it came on the heels of the suspension of an unrelated company, Hong Kong-listed China Forestry Holdings, for accounting irregularities.

Analysts cannot agree whether Sino-Forest is a fraud.  Some have questioned the sensational accusations and have scored points by showing that Muddy Waters has been sloppy.  “A pile of crap,” said Richard Kelertas of Dundee Capital Markets on Tuesday, referring to the research by the short seller.

Others, such as Nomura analyst Annisa Lee, have been skeptical of the Chinese company’s reporting.  She has made the most telling point during the two weeks of controversy by pointing out that Sino-Forest’s claim that its largest customer accounted for 17% of revenues in 2010 is not credible.  Lee notes that almost all Chinese purchasers are small-scale, so there is no customer that could have bought $325 million in timber from Sino-Forest last year.

Sino-Forest has denied charges, but its defense has been tardy and, to date, unconvincing.  The beleaguered company gets a chance to set the record straight, however, when it reports first quarter earnings on Tuesday morning.  Tuesday’s report, its first under new international standards replacing Canada’s generally accepted accounting principles, will be closely analyzed as it will, one way or another, affect virtually all of China’s non-state companies traded abroad.

Why?  In the wake of the initial charges against Sino-Forest, the shorts have gone on to target small China-linked issuers as a class.  Ruinian International, for instance, blamed short sellers for a 25% drop in its stock in the past two weeks.  The health-products maker denies problems and says its business is sound.  Nonetheless, this month Hong Kong-listed stocks of Chinese companies are the world’s worst performers.

And they should be.  “Everybody wants a piece of China,” noted Martin Wheatley last week on his final day as head of Hong Kong’s Securities and Futures Commission.  And to get in on the action, investors are acting like gamblers in Macau, standing six-deep at the roulette wheel and throwing chips over the heads of those in front so that they land on a number on the table.  China, as Wheatley points out, is “the new dot-com.”

In this dot-com-like bubble, the smaller companies will prove to be especially poor investments, at least over the long term.  Of course, there is the problem of fraud.  It is exceedingly difficult to build a private business in the state-dominated Chinese economy without committing high crimes and misdemeanors.  Entrepreneurs, as a practical matter, have to lie, cheat, and steal every day just to keep their businesses going.  In these circumstances, do you really think they tell the truth to auditors, underwriters, and regulators?
But fibbing, dishonesty, and theft are not the most important issues for foreign investors.  These problems have so far been masked by high growth, so even crooked companies—especially them—have been providing superior returns to investors.
Yet China’s economy is now coming back to earth as it exits a period of double-digit expansion.  At the same time, it remains plagued by soaring inflation, which is accelerating as growth stalls.  The next phase is inevitable—a period marked by deflating asset prices.  We are already starting to see evidence of weakness in the coastal property markets.  Smaller companies, therefore, are going to have to navigate a much more difficult economic environment.  Many of them—and not just the weak ones—won’t make it through this turbulent period.

On top of this, Beijing is continuing to renationalize the economy.  So it should come as no surprise that gargantuan state enterprises are taking advantage of this regressive trend to obtain for themselves the lucrative opportunities that have been created by smaller companies.

Consider the plight of Zhejiang Glass, the first privately held Chinese enterprise to go public in Hong Kong.  The troubled concern, which has more debt than assets, looks like it is being forcibly nationalized by local governments grabbing assets.  Its real crime, in the eyes of the cadres, is that it has no state shareholders and so is hard to milk.
Other private businesses are also being taken over by government officials looking for any excuse to plunder the private sector.  As they say in China, “The Communist Party is now the economy.”
So let’s get back to Sino-Forest.  If its officers are found to have inflated assets or earnings as Muddy Waters charges, expect provincial officials to strictly enforce rules that are never applied to state enterprises.  And as they do so, they could break up the now-private company and grab parts of it, just as they are doing to Zhejiang Glass and other businesses across China.
Hong Kong’s South China Morning Post says Zhejiang Glass is being “nationalized by stealth.”  Actually, the process is more akin to private enrichment by nationalization.  No matter what you call it, China’s private sector is under fearsome attack.

Nokia loses another technology chief

Nokia's chief technology officer Rich Green has taken a leave of absence from the mobile phone giant.

An official Nokia statement said he had left to resolve a "personal matter" and gave no date for his return.
However, a Finnish newspaper quoted sources inside Nokia saying he had left because of differences over strategy and would not return.
Mr Green was known to champion the MeeGo mobile operating system which Nokia recently sidelined.
That decision was brought about by Nokia boss Stephen Elop's decision to adopt Microsoft's Windows Phone software for its smartphones.
Tech change
Finnish newspaper Helsingin Sanomat cited unnamed Nokia sources who claimed that Mr Green's departure was linked to the MeeGo decision. In particular, it said, Mr Green was unhappy with Nokia's decision to abandon plans to produce phones built around the system.
In its statement, Nokia said Mr Green's absence would have "no impact on our product strategy or our expected product launch timelines".

Rich Green was known as a keen supporter of the Meego system

Rich Green joined Nokia in early 2010 following a 19 year stint at Sun Microsystems where he latterly oversaw the move of Java code onto mobile phones.
When he was appointed, he was Nokia's fourth chief technology officer in five years. The company said that Henry Tirri, currently head of Nokia's research labs, will take over the post of technology boss.
The news of Mr Green's departure caps a rough month for Nokia in which it announced that sales of its phones during the second quarter of the year would be substantially below previous forecasts.
Ian Fogg, an independent industry analyst, declined to comment specifically on Rich Green's departure but said the transformation Nokia was currently going through was fast and far reaching.
Senior management at Nokia have had to make some very hard decisions about its older projects and products, he said, adding that the strategy switch to Windows had to take the entire company along with it.
This was essential to ensure Nokia could get on with the job of producing Windows Phone handsets, explained Mr Fogg. However, he expressed concern that the company was moving fast enough.
"Nokia has to bring Windows Phone devices to market quickly," said Mr Fogg. "It has to execute faster. They need those devices to be shipping."

China's bank lending dips sharply

China's banks extended fewer than expected new loans in May as the country kept up its efforts to rein in rising prices.

 

A surge in real property prices has created fears of formation of asset bubbles in China

Chinese banks lent 551.6bn yuan ($85bn; £52bn) in new loans, compared with 739.6bn yuan in April, according to the People's Bank of China.
Authorities have been trying to slow down lending in an attempt to rein in rising property prices and inflation.
China is the world's second largest economy.
"The lending growth last month is slower than market expectations, showing that tightening measures are biting," said E Yongjian of Bank of Communications in Shanghai.
Lending spree
As the global financial crisis gripped the world, Chinese authorities set lending targets for banks in an attempt to provide capital to the markets to boost growth.

That saw the country's banks lend record amounts of money, issuing a combined 17.5tn yuan of new loans in 2009 and 2010.

However, analysts say that the affects of that policy are taking their toll on the banks.
"China has witnessed a long program of extending loans for the past two years," said Peter Hoflich of The Asian Banker.
"This can't go on for ever, the banks may even be running out of capital," he added.
Tightening measures
While the record lending spree contributed to the growth of the Chinese economy, it has also created problems.
Availability of cash saw investments into sectors like real estate surge, sending the property prices soaring.
The country has also had to deal with rising prices of food and other essential commodities.
Worried by the prospect of formation of asset bubbles and overheating of the economy, the government has tightened its policies in an attempt to slow down lending.
China's central bank has raised the amount of money that lenders must hold in reserve four times this year.
It has also asked banks to maintain better loan-to-deposit ratio making it difficult for banks to lend.
Analysts said that they expect the government to tighten its grip even further.
"We expect the tightening monetary stance to continue in the future, as curbing inflation remains the government's top priority," said Li Huiyong of Shenyin & Wanguo Securities.

'Sophisticated cyber attack' targets IMF

Hackers attempted to create a mysterious 'insider presence' at the organisation, which is investigating with the FBI.

The IMF announced a 'very major breach' in its electronic network on Saturday [Reuters]

The International Monetary Fund's computer system has been targeted in a cyber attack which sought to gain an 'insider presence' in the organisation's network.
An IMF spokesperson said on Saturday that the network was hacked and much information was stolen prior to the May 14 arrest of former IMF chief Dominique Strauss-Kahn, but would not release more details about what was taken.
"The fund is fully functional," said David Hawley, the IMF spokesperson.
"I can confirm that we are investigating an incident. I am not in a position to elaborate further on the extent of the cybersecurity incident."
"This was a very major breach," a senior official with knowledge of the attack told the New York Times.
According to a cybersecurity expert who has worked for both the IMF and World Bank, the goal of the attack was to install software that would give a nation-state a "digital  insider presence" on the network.
Probing the attack
No reliable source has yet identified what government orchestrated the hack, but the United States' Federal Bureau of Investigation is involved in an investigation of the cyber attack, according to a US Defense Departmentspokesperson.
The IMF, which has sensitive information on the economies of many nations, was hit during the last several months by what computer experts described as a large and sophisticated cyber attack, The New York Times reported.
The newspaper said the IMF's board of directors was told on Wednesday about the attack.
Internal IMF memos had warned employees to be on their guard.
"Last week we detected some suspicious file transfers, and the subsequent investigation established that a Fund desktop computer had been compromised and used to access some Fund systems," said the June 8 email to employees from Chief Information Officer Jonathan Palmer.
"At this point, we have no reason to believe that any personal information was sought for fraud purposes," the message to employees said.
'Increasing threat'
Cybersecurity experts say it is very difficult to trace a sophisticated cyber break-in to its ultimate source.
An official with the World Bank, the IMF's sister institution in Washington, said the World Bank had cut its network connection with the IMF out of "caution".
The information shared on that link was "non sensitive info," the official added.
"The World Bank Group, like any other large organisation, is increasingly aware of potential threats to the security of our information system and we are constantly working to improve our defenses," said World Bank spokesperson Rich Mills.
Experts say cyber threats are increasing worldwide.
CIA Director Leon Panetta told the US Congress this week the United States faces the "real possibility" of a crippling cyber attack.
"The next Pearl Harbor that we confront," he said, could be a cyber attack that "cripples our power systems, our grid, our security systems, our financial systems, our governmental systems."
"This is a real possibility in today's world," Panetta told his June 9 confirmation hearing in his bid to become the next US defense secretary.
The incident comes as attacks on computer networks are said by experts to be on the rise - notably those targeting major companies and potentially compromising government security and customer information.
For instance, Lockheed Martin Corp, the Pentagon's top military supplier by sales and the biggest information technology provider to the US government, disclosed two weeks ago that it had thwarted a "significant" cyber attack and said it was a "frequent target of adversaries around the world."
Also hit recently have been Citigroup Inc, Sony Corp and Google.
The attack on Lockheed followed the compromise of "SecurID" electronic keys issued by EMC's Ltd RSA Security division.
SecurIDs are widely used electronic keys to computer systems, designed to thwart hackers by requiring two passcodes: one that is fixed and another that is automatically generated every few seconds by the security system.
SecurIDs are used at the World Bank for remote log-ins.
As an extra precaution, employees receive an automatic email each time they log in from outside, to flag the operation in case it was originated fraudulently by someone else, a World Bank staff member said.

God Particle

The quest for the elusive Higgs boson seemed over in April, when an unexpected result from an atom smasher seemed to herald the discovery of the famous particle -- the last unproven piece of the physics puzzle and one of the great mysteries scientists face today.

AP

Researchers were cautious, however, warning that it would take months to verify the finding.

Their caution was wise.

Scientists with the Tevatron particle accelerator at Chicago's Fermilab facility just released the results of a months-long effort by the lab's brightest minds to confirm the finding. What did they find? Nothing.

"We do not see the signal," Dmitri Denisov, staff scientist at Fermilab, told FoxNews.com. "If it existed, we would see it. But when we look at our data, we basically see nothing."

"At this point I'd say the chances are 50/50 for the Higgs to exist at all," he said.

The results -- submitted Friday to the science journal Physical Review Letters -- are a heartbreaking setback for scientists and armchair experimenters worldwide, who have been following the particle-physics treasure hunt like a baseball fan monitoring stats.

After all, the quest for the Higgs boson -- called the "God Particle" because it is believed to be the fundamental particle of matter, the smallest piece of substance that gives all other matter weight -- has been among the most prominent scientific pursuits of the last 20 years.

The Large Hadron Collider (LHC), the multi-billion dollar, 17-mile long particle accelerator in Geneva was built in part to help prove the theoretical bit's existence. 

James Gilies, a spokesman for CERN, the agency that operates the LHC, told FoxNews.com that it was still too soon for his group to release any analysis -- and way too early for hopes to have been raised in the first place.

"Still too early to get excited, I'm afraid ... I think this story will reach a  conclusion at the main summer conferences this year -- end of July. By then, the LHC experiments will have analyzed enough data to be able to say something," Gilies said.

Though disappointing, the results shouldn't really come as a surprise, physicists say. The strange anomaly that led to the God Particle chatter was nothing like what physicists expected from the Higgs in the first place.

"I had known from the start. It could not be a Higgs, and it can't be anything else either," Tommaso Dorigo, an experimental particle physicist who works with both atom smashers, told FoxNews.com. Denisov agreed.

"It was never the way the Higgs boson was supposed decay. It was something completely different. It wasn't even obtained by the group that was hunting for the Higgs!" he said.

So what was it, anyway? Something completely unknown and unexpected, Denisov said, which is what prompted Fermilab to drop everything and assign its top scientists to uncover an unfortunate truth: Someone forgot to carry a zero.

"Probably the way they are estimating standard model backgrounds is not correct," he said. One minor mistake and the tantalizing signal disappears, in other words. "My suspicion is that one way or the other, they're not modeling the standard background correctly."

Despite the disappointing setback, the quest for the Higgs boson is nonetheless drawing to a close.

"I'm pretty confident that towards the end of 2012 we will have an answer to the Shakespeare question for the Higgs boson, to be, or not to be?" Rolf-Dieter Heuer, director general of CERN, said at Britain's Royal Society.

Denisov agrees that the next few months could be eye-opening. And for Fermilab and the Tevatron, which is scheduled to be shut down this summer, it has to be.

"We are planning to finish our data taking later this year, and Tevatron will be shut down," he said. "It will either be seen at Tevatron in completely different decay models or at LHC or not at all."

Fermilab closing its doors probably won't end the Higgs hunt; the LHC is a more likely site for the discovery anyway, being newer, bigger, and ultimately better. And even Denisov was willing to admit that.

"It's like a Ford Model T trying to compete with a Ferrari," he joked.