Archive for January 17, 2008

The Roadrunner Won’t Run

January 17, 2008

Video Killed the Broadband Buffet

Time Warner can’t sustain a huge increase in power users on the current infrastructure; with a buffet model, such an increase would force it to either expand the network or force heavy users out of it altogether. Metered pricing, if it works, would allow them to do both. Depending on the pricing structure, some power users will have to reduce their usage, and in an ideal world money generated by the service would go toward network expansion.


Verizon will be signing up mad gobs of people as FIOS comes to town. Meanwhile Time Warner runs ads touting Roadrunner as being based on fiber and, without naming it, bashing FIOS.

And Then The Thing Happens

January 17, 2008

Shiller on New York: We’re Ancient Rome, Right Before the Fall
Yale economics professor Robert Shiller famously predicted the death of the dotcom boom. He’s been warning about a real estate bubble for years, but now he says New York will self-destruct if prices don’t come down: ‘It can’t keep going like this!’

Is the tip-top of the high-end market vulnerable, or is it protected because there will always be enough billionaires who want to grab up the small amount of trophy properties?

The point of the [Christopher] Mayer and [Todd] Sinai “Superstar Cities” paper is that income inequality is worsening in the U.S. and it’s worsening around the world. And their point about superstar cities is that they are increasingly populated by the super-rich, not just New York … Where will it go from here? The “Superstar Cities” people seem to think that it’s just a law of nature and will continue, but I wonder … The idea that Manhattan is going to be this super-rich city in the midst of a country where more and more people are having trouble, where these low-income wages are not going up? I don’t know! I just wouldn’t bet on it. I’m not talking about this election, but eventually something has a chance of happening that’s going to stop this.

If not political action then perhaps a set of terrorist dirty bombs that contaminate the city and make it uninhabitable. Put that into your spreadsheet and figure the loss to the national — and global — economy.

The Bottom Is Deeper Than Anyone Can Imagine

January 17, 2008


I don’t like swiping someone else’s picture but if I had just described it, hardly anyone would have bothered to click through to see.

Eight-six per cent drop in value!

And the bottom hasn’t been reached yet.

There are more here.

Top level is a site documenting the housing crash, with a great feed of news stories in the right-hand column.

Titanic Economy Meets Iceberg

January 17, 2008

Bernanke: Juice the economy ‘quickly’
Fed chairman, urging lawmakers to boost consumer spending within 12 months, tags mortgage meltdown’s cost at $100 billion or more.

Bernanke said that current losses from the subprime mortgage mess were probably about $100 billion but cautioned that this figure could wind up being higher.

Former Treasury Secretary Larry Summers told lawmakers on Tuesday that Congress should consider a stimulus package of up to $150 billion. He proposed an immediate injection of $50 billion to $75 billion through a combination of tax cuts and increased spending on unemployment benefits and other programs. He also advocated that another $50 billion to $75 billion be set aside in case economic conditions weaken further.

During Thursday’s hearing, Bernanke said he thought a fiscal stimulus package of up to $150 billion, would be “reasonable.”

Where is the money coming from? How much is being spent on the war? And how will we pay for that and the deficit and the debt?

Selfishness Is Its Own Enemy

January 17, 2008

Misery creep

We all know the old saying: “Riches won’t make you happy.” But is it possible that riches – or even aspiring to be rich and wanting to live a Footballers’ Wife-style life of luxury – might make us mentally ill?

Clinical psychologist Oliver James claims in his new book The Selfish Capitalist: Origins of Affluenza, that “selfish capitalism” (the kind of capitalism we have in Britain) is making us sick. Literally.

He says the emergence of selfish capitalism, first under Margaret Thatcher and later Tony Blair, has led to a “startling increase in the incidence of mental illness”.

We might live more comfortable and stuff-filled lives than our forebears did, but James believes the rise of materialism has come with a high price tag attached – widespread anxiety and depression.

Seems like too narrow a focus. What about all the minds that are fried by drugs? I’ve been around rich people. It’s a wonder they can function with the stuff they put up their noses, into their veins, and into their lungs.

Buy Now, Pay Later. Now Is Later.

January 17, 2008

Wealthy may be next in line in U.S. home crisis

Real estate agents warn that some high-income borrowers have already been forced to sell or leave their homes and more will follow. Especially those who used their homes as ATMs, withdrawing cash via home equity loans.

“For those who utilized home equity loans for five to ten years to finance their lifestyle, the chickens are coming home to roost,” said Chicago-based real estate agent Marki Lemons.

Real estate is in a China Syndrome.