The interconnected world of credit
This is a great map of the global credit crisis, courtesy of Fortune magazine. Check it out.
You can see how what began as bad subprime loans in California spread rapidly throughout the world in 2007.
http://money.cnn.com/magazines/fortune/storysupplement/subprime_global/
Superconnection at work.
Touchless computer screens - ultracool
What happens when you include a Wii remote hack, Minority Report style gloves, and Microsoft windows?
Oh, very cool stuff.
Future Inc to be published in Bahasa Indonesia!
This is the development the business world has been waiting for!
I just got
word from AMACOM Books that finally, after the clamoring of millions of readers, Future Inc. will be published in the Indonesian language!
Seriously, I’m tickled. These are the little developments you never expect when you are writing a book. Fun stuff.
This year, China passes the United States in total Internet users
According to the Chinese government, the total number of internet users will pass 210 million this year, finally catching up to the United States. 
Impressive enough, with lots of strategic implications for businesses and governments just on its face.
Cross reference this with the next-generation capabilities of IPv6 architecture, which will allow central governments unprecedented control of who gets what information and how they get it.
Now, this needs some heavier discussion.
-Garland
Toyota Prius outsells Ford Explorer
http://articles.moneycentral.msn.com/Investing/Extra/ToyotaPriusSalesPassFordExplorer.aspx
Prius sales up 68% last year.
Sacre Bleu! The French Have the Majority of their Babies out of Wedlock!
Social trend alert! Et ben, c’est hyper important!
We all know that our friends the French, culinary inventors of Freedom Fries, are social innovators. They pioneered the art of running a major world economy on only 35 hours a week. They were the first to assure that incompetent workers could rest easy, knowing that it was illegal for them to be fired. And I believe the average paid vacation package still stands at 43 weeks per year, though that stat could be out of date.
However, the newspaper Le Figaro does much better fact checking than I do, and they are reporting that for the first time ever in France, babies born to non-married households now outnumber those born to two parents living together.
Could it be that living with men who dress like this is too painful?
Cheap shots against the French aside, (et laissez-moi vous assurer mes amis francophones, si je rigole, c’est parce que je vous aime tellement,) this strikes me as a very important signal for social structure in the future. Already, most of Europe is bracing for the onslaught of aging populations as they weigh ever more on the welfare state’s social programs. On top of it, most of Europe has a shrinking population, less than 2.0 babies per couple. Italy, Poland, and Czech Republic are just a few examples of those nations in dire straits. Here, we have even more strain on the system - a sign that one more bond of the 20th century family contract is breaking down.
Is it all bad? Well, I’m not here to judge the morals of such a trend, but I can tell you there are complications. Our governmental systems, especially in the United States, are designed to augment the social support of families, not replace them entirely. By this I mean, who takes care of Grandma if you have only met Grandma a couple of times? Our social systems sort of assume that you’ll have an emotional bond with your elders and want to care for them. But what if that ceases to be true, because you don’t spend much time together as a family?
I can already tell you that hospitals in downtown Washington DC see families abandon their old people to the state apparatus all too often - especially since the system isn’t designed to handle it. It is designed to help young people take care of the elderly, not care for them entirely.
Eldercare is just one implication here to the single, out-of-wedlock household becoming the statistical norm. Think about all the implications for new products, services, education, workforce, housing and so on.
This is big.
-Garland
Deeper implications of the housing debacle in the United States
There’s a great article in Fortune today that dives further into the depths of the American housing crisis
while also explaining how the concept of strategic implications should work:
Will foreclosures spark an arson boom?
If you live anywhere near the United States or have heard of it, you may have heard that there’s a bit of a problem with the housing sector of our economy. They call it the "sub-prime mortgage crisis" but this is a misnomer. The problem is with the entire housing sector and the banks that financed it. The root of this problem is that housing prices advanced a factor of ten ahead of wages. For example, if everybody’s housing costs increase 38% a year (as they did in Washington, L.A., Florida, Boston, and other locales) when wages only increase 3%, that means people are getting less for their relative compensation. If you think of healthcare costs and education costs increasing at 10 - 15% at the same time, then the Middle Class ends up…um…well the technical term in international economics is "screwed."
They call it the "sub-prime mortgage crisis," but as I said, this isn’t accurate. The problem is that my apartment in the Washington suburbs costs the same as one-bedrooms on Ile St Louis smack dab in the middle of Paris, only I am not staring at the backside of Notre Dame cathedral and living next to Jodie Foster and a bunch of French cabinet ministers. This is NOT NORMAL. The problem with housing in the United States is that the entire sector of housing has been subject to the emotional shifts of the market with no regard to actual value of hard assets as Baby Boomers leave the workforce and Gen X ascends to economic maturity.
A great many people have fallen victim to the collective housing hoax. The sub-prime aspect is publicized because many banks extended interest-only loans to get people into inflated mortgages that they couldn’t - and shouldn’t - have afforded. Last month, credit card defaults started increasing significantly, because systemically people couldn’t afford their mortgage increases, and the slack went to credit cards, which those people couldn’t afford either.
This is where the increase in arson comes in. In professional studies of the future, we’d say that arson is a second implication of credit card defaults, and a tertiary implication of the collapse of the mortgage market. It also shows superconnection, which I discuss at length in Future Inc. The rationale is clear - people can only handle so much financially, and if their credit cards and mortgages reach the total breaking point, some will take the easy way out. They will try to collect the insurance payout before having to deal with selling an overpriced home on a distressed market. It’s not certain to occur, but it certainly makes sense - in any event the insurance industry is bracing for such a trend.
Now, if you really want to get nervous - consider that to bail themselves out of this mess, many of America’s top financial firms are selling out to foreign investors - even foreign governments - to cover this up.
That’s good futurism for you - start with something obvious, like stupidly priced condominiums in ugly neighborhoods, and consider the systemic implications. It’s a game you can play at home, and we hope you do!
-Garland
Consumer Electronics Show 2008 becomes the world’s largest carbon neutral event
As a rule, I haven’t really understood carbon trading and carbon caps as a way to mitigate global warming. It has always seemed just a stop-gap measure on the way to the real heavy lifting of transforming industry. But that doesn’t mean it’s not useful - or about to gain more acceptance.
According to Newsweek, this years Consumer Electronics Show, the blinding Vegas orgy of televisions,
satellite radios, and gadgets galore, has announced it has become the world’s largest carbon neutral event.
According to carbonfund.org’s Eric Carlson, they are offsetting the carbon from CES 2008 in a variety of ways. "One third is through renewable energy, which means things like wind
energy and methane. Another third is through reforestation and the
other third is through energy efficiency, which is general industrial
energy improvements. CES is offsetting 6,500 tons per type."
When operations as big as the Consumer Electronics Show start leading in this manner - what are the implications? So what? What if? What else?
-Garland
The British take on the potential mortgage meltdown
Further to yesterday’s newsletter, one of my Canadian colleagues sent me a link to an Op-Ed surmising that the worst is yet to come with the mortgage crisis. Given that rents in DC are still higher than Paris without all the annoying culture, history, luxury, and cuisine, we’re quite inclined to agree that a "correction" still looms.
It occurs to me that I forgot to post my favorite assessment of the current financial situation, courtesy of British comedians John Bird and John Fortune:
Is America ready for a bass playing president?
It is our company policy to avoid political affiliation and bias at all cost. That said I would like to present the picture below:
A question asked constant in American politics is, "Are we ready for a ________ president in the United States?" That usually means women president, black president, Urdu-speaking president, ambidextrous president, what have you.
As a professional musician, I’d like to submit that while I do not care for Arkansas Governor Mike Huckabee’s policy positions aside from public healthcare, I think America is finally ready for a bass playing president.
This man is playing a vintage Fender P-Bass, and I know that he also plays high-end Tobiases - both basses I have in my personal collection. This is a sign of good taste in low-end tone. I have seen YouTube clips of Huckabee playing Elvis tunes, and I can attest to his skill as a rhythm section player. While I am unconvinced of Huckabee’s science and tech policy, I think we should consider that America needs bass players in general. Bassists care for the groove, we listen to other points of view around us, we guide without being showy. I don’t know that Huckabee will do this as president, but I know that the skills of the bass player must be cultivated in our society in general.
Plus, and this is a HUGE PLUS, Huckabee has the full support of Chuck Norris. In fact, I think Norris would make an excellent Vice President. The president could play funk grooves on the bass, and the Vice President could roundhouse kick people in the face as part of foreign policy.
My point is, aside from military defense and infrastructure management, the greatest service a government can provide is entertainment.
Here endeth the political commentary.
Happy 2008 to everyone - hope it gets off to a great start.
-Garland
Be social