Friday Lite

The labor department reported 121,000 new jobs for the month of June, well below expectations near 200,000. Despite the hope inspired by the ADP employment report on Wednesday, where 368,000 new private sector jobs were forecast, today's report provided more evidence of a slowing economy.

After averaging between 150,00 and 180,000 new jobs per month for the previous five quarters, payroll growth for the second quarter averaged only 108,000, in large part due to the decline in new positions for construction and retail trade - housing and consumption.

Accounting for an average of more than 30,000 new payroll spots per month for much of the last few years, construction employment gains have averaged less the 3,000 in the last four months, actually declining in June, most of this a result of a slowing residential housing market.

Retail trade employment has slowed even more dramatically. After generating an average of over 15,000 new positions each month during 2004 and 2005, the first six months of this year have seen an average decline of 13,000.

Government hiring led the way in the most recent report with 31,000 new jobs followed by education and health services with 26,000. Some found solace in the half percent increase in hourly wages yielding a year-over-year gain of 3.9 percent, the highest annual increase since 2001. But, overall this was a very disappointing report and provides more credence to the case for a pause or cessation in interest rate increases.

With these interesting developments in housing and consumption related employment, it's probably about time to whip up some new charts to see how the numbers look over a period of years - since housing began to boom. That, however, will be left for another day, for now it is on to the unbearable liteness that is Friday.

Rising Inflation and Interest Rates Around the World

It seems the U.S. isn't the only country in the world that has rising inflation and rising interest rates. A couple weeks ago it was Turkey, South Africa, and South Korea, and now Japan seems set to join the party. Yesterday the Bank of England and the European Central Bank both kept rates level but hinted at further increases, while Bloomberg reports that Iceland's Central Bank has taken the gloves off.

Iceland's central bank raised its benchmark interest rate by three-quarters of a point to 13 percent, more than expected, to cool inflation that is accelerating at more than three times the bank's target pace.
...
Inflation in Iceland's $13 billion economy quickened in each of the past four months, stoked by the krona's 23 percent decline against the euro this year.
...
Inflation will probably accelerate to 8.5 percent this month from 8 percent in June, Siegenthaler estimates. He sees inflation quickening to 9 percent in August.

It's as if Paul Volcker has come out of retirement - thirteen percent! That's what happens when a tiny nation of less than 300,000 citizens plugs into an over-liquefied world and exposes their freely floating currency to the forces that are the Global Economy 2006 World Tour.

The Housing Bubble Arrives in Calgary

Tar sands fever seems to have awoken a slumbering housing market in Alberta, Canada. Having driven through this area not more than a few years ago, it was surprising to see signs that said, "From the $140,000s". According to this report, they are now doing a 2005 Bakersfield boom, similar to the near exponential rise experienced by the real estate market of this central California town with the brown summer sky that also has oil nearby.

The average price of a standard two-storey resale home rocketed an unprecedented 54.6 per cent to $397,867 in the second quarter of 2006, compared with a year earlier, according to a quarterly report Royal LePage Real Estate Services released yesterday.

"Since we started doing this report in the '70s, we've never seen this kind of price appreciation in one year, ever," Phil Soper, president and chief executive of Royal LePage, said in an interview.

Alberta's oil-rich economy has meant severe housing shortages and major price increases in the western provinces. "The Alberta housing market is truly reacting to the fact it is by far the best-performing economy in Canada," Century 21 Canada president Don Lawby said in an interview.

Of course the big difference between Calgary and Bakersfield is that they have plenty of oil left in Northern Alberta, as compared to the pump-jacks bobbing up and down around Bakersfield. The George H. W. Bush family actually lived in Bakersfield for a short time many, many years ago, George W. Bush was a just a toddler at the time, however they've recently transformed the house they lived in into a tourist attraction.

"I'd Like to Teach the World To Steal ..."

Remember those Coke commercials from decades ago where young people with long hair held hands on a mountain top and sang about doing good things in the world? According to this report, the crew that stole secret formulas from Coca Cola in order to sell them to Pepsi Cola were not yet even teenagers at the time.

Three people have been arrested and charged with stealing confidential information about drink recipes from The Coca-Cola Co. and trying to sell it to rival PepsiCo Inc., federal prosecutors said Wednesday.

The suspects include an executive administrative assistant at Atlanta-based Coke, Joya Williams, who is accused of rifling through corporate files and stuffing documents and a new Coca-Cola product into a personal bag.

Williams, 41, of Norcross, Georgia; 30-year-old Ibrahim Dimson, of New York; and 43-year-old Edmund Duhaney of Decatur, Georgia, are charged with wire fraud and unlawfully stealing and selling Coke trade secrets, federal prosecutors said.

Of course, Atlanta does have one of the highest foreclosure rates in the country, so maybe they were just trying to save their McMansions. How times have changes in just a few decades.

Vladimir's Got a Computer (and Maybe Giant Humanoid Robots)

This story from China Daily tells of a live internet conference aired by the BBC where Russian President Vladimir Putin answered questions online regarding such topics as North Korea, Iran, and natural gas supplies, but deftly avoided sensitive subjects such as border protection.

Answering only a few of the thousands of questions that dealt with personal details or quirky issues such as whether Russia would deploy giant humanoid robots to protect its borders, Putin also defended devastating military campaign in Chechnya, saying Russia would do all it can to preserve its territorial integrity.

"Of course it was worth it," Putin said of the war that Moscow launched when he was prime minister in 1999, the second Moscow has waged against separatist militants in the mostly Muslim southern region since the Soviet breakup.

The emotional outburst regarding Chechnya was widely perceived by attendees of the event as just a means to distract attention from the giant humanoid robot issue that has dogged Putin leading up to the G-8 summit, hosted by Russia later this month.

As if GM Didn't Have Enough to Worry About ...

While they still need to work on both their car models and their advertising models (as evidenced by the photo below), China's fledgling automobile industry should not be discounted - let them do the discounting. According to this report they've reserved space at Detroit's next Auto Show in January.

At least four Chinese automakers are expected to take display space at the 2007 North American International Auto Show in Detroit, US media reported.

In January 2006, China's Geely Automobile made debut by a Chinese carmaker at the US auto show. It exhibited a $10,000 small sedan to reporters only in a booth outside the show's main hall. This year, Geely will come back.

Moreover, three other companies, including Hunan Chang Feng Group, Great Wall Motor Company and Hebei Zhongxing Automobile Company, are also in talks for display space in Cobo Hall of the January 2007 show, said the Detroit News.

The Chery Automobile, an independent Chinese carmaker based in East China's Anhui Province, hopes to enter the US market in 2008, the newspaper said.

Americans can make fun of the Chery at their own peril - it is likely that none of the 35,000 GM workers accepting early retirement are laughing much or sleeping well at night with the prospect of their retirement income being derived from income GM earns when competing against this new auto manufacturer in the years and decades ahead.

Microsoft's Two Bits

News comes from The Onion that Microsoft has taken a bold step to protect the company's intellectual property by securing patents for the numbers zero and one - digits that are crucial to the proper functioning of the binary system used throughout the computer industry. According to this story, with the upcoming departure of CEO Bill Gates the move was deemed necessary to maintain their competitive advantage in a changing software market.

With the patent, Microsoft's rivals are prohibited from manufacturing or selling products containing zeroes and ones—the mathematical building blocks of all computer languages and programs—unless a royalty fee of 10 cents per digit used is paid to the software giant.

"Microsoft has been using the binary system of ones and zeroes ever since its inception in 1975," Gates told reporters. "For years, in the interest of the overall health of the computer industry, we permitted the free and unfettered use of our proprietary numeric systems. However, changing marketplace conditions and the increasingly predatory practices of certain competitors now leave us with no choice but to seek compensation for the use of our numerals."

A number of major Silicon Valley players, including Apple Computer, Netscape and Sun Microsystems, said they will challenge the Microsoft patent as monopolistic and anti-competitive, claiming that the 10-cent-per-digit licensing fee would bankrupt them instantly.

Rumor has it that Google has already perfected the ternary system and has plans to announce this new computing platform that will render all binary systems obsolete (now, if they could only get Ebay to accept their new payment system instead of PayPal).

Bored at Work?

This Duck Computer Mouse will entertain you for hours. Designed and built by Now, a Swiss manufacturer of precision computer pointing equipment, this goodie will help you pass the hours until quittin' time.

Their innovative design makes Now mice a perfect gift for anybody working with a computer. Attractively wrapped in a specially designed box, these trendy “desk pets” are a temptation not many can resist.

Splish-splash, how about taking a bath? The Duck mouse is Now’s perfect accessory for mermaids, non-swimmers and bathtub captains. This unique mouse with a free-floating duck is sure to brighten up a long day at work.

Either that, or you can pass the time by reading blogs, or, better yet by writing one.