Category Archives: Economy and Meltdown

"As Part Of Our Ongoing Effort To Protect Bank Of America, Zero Hedge Is Blocked"

We couldn’t have said it better: “Bank of America blocks users from accessing websites that present certain risks to the bank.

Let’s see, maybe this will get Zero Hedge unblocked: “Just buy BAC stock. Others are doing it, so you must do it too. And if you buy in the next 5 minutes, you will get one free share for every share purchased!

… Well, maybe not. 

Does this also mean we are not in contention for the Andrew Ross Sorkin Wall Street-sponsored website of the year award either?… Perhaps we should shelve those Pulitzer dreams too.

Oh well. At least the National Financial Enquirer and other various financial tabloids are still fully accessible at the bank that is best known for the worst M&A transaction of all time – Countrywide Financial. And that whole double bailout thing of course, first of Merrill, and then of Bank of America proper.

Instagram Posts Update: "To Be Clear: It Is Not Our Intention To Sell Your Photos"

Update: in what may be a death knell for Instagram, National Geographic just announced it would stop posting images to Instagram.

A day after an epic backlash to what many understood was a change in Instagram’s TOS, which would see users vacate property and ownership rights over their photos shared on the popular social network – a concept clearly spelled out – and hand these over to Facebook (which recently acquired the Photoshop filters at the backbone of Instagram’s business model for an ungodly amount), leading to a furious and perfectly expected exodus of users closing their Instagram accounts, here is the company’s panicked response, in which it explains it did not mean what it meant. To wit:”To be clear: it is not our intention to sell your photos.” What about selling photos accidentally? Which explains the legalese, because while it may not be “our intention”, it is no longer expressly prohibited, is it?

Is it too little too late? And can the company convince the millions that have already left, and the further tens of millions on the fences, that its mission, like Google, is also”to do no evil”? We will find out in the next several days when Instagram’s competitors are furiously collating the latest Comscore and various other traffic data to pronounce the early death of the photo sharing service over something as “trivial” as a change in the Terms of Service which many had hoped would fly under the radar unnoticed by anyone.

From Instragram’s blog (highlights ours)


Thank you, and we’re listening

Yesterday we introduced a new version of our Policy and Terms of Service that will take effect in thirty days. These two documents help communicate as clearly as possible our relationship with the users of Instagram so you understand how your data will be used, and the rules that govern the thriving and active Instagram community. Since making these changes, we’ve heard loud and clear that many users are confused and upset about what the changes mean.

I’m writing this today to let you know we’re listening and to commit to you that we will be doing more to answer your questions, fix any mistakes, and eliminate the confusion. As we review your feedback and stories in the press, we’re going to modify specific parts of the terms to make it more clear what will happen with your photos.

Legal documents are easy to misinterpret. So I’d like to address specific concerns we’ve heard from everyone:

Advertising on Instagram From the start, Instagram was created to become a business. Advertising is one of many ways that Instagram can become a self-sustaining business, but not the only one. Our intention in updating the terms was to communicate that we’d like to experiment with innovative advertising that feels appropriate on Instagram. Instead it was interpreted by many that we were going to sell your photos to others without any compensation. This is not true and it is our mistake that this language is confusing. To be clear: it is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear.

To provide context, we envision a future where both users and brands alike may promote their photos & accounts to increase engagement and to build a more meaningful following. Let’s say a business wanted to promote their account to gain more followers and Instagram was able to feature them in some way. In order to help make a more relevant and useful promotion, it would be helpful to see which of the people you follow also follow this business. In this way, some of the data you produce — like the actions you take (eg, following the account) and your profile photo — might show up if you are following this business.

The language we proposed also raised question about whether your photos can be part of an advertisement. We do not have plans for anything like this and because of that we’re going to remove the language that raised the question. Our main goal is to avoid things likes advertising banners you see in other apps that would hurt the Instagram user experience. Instead, we want to create meaningful ways to help you discover new and interesting accounts and content while building a self-sustaining business at the same time.

Ownership Rights Instagram users own their content and Instagram does not claim any ownership rights over your photos. Nothing about this has changed. We respect that there are creative artists and hobbyists alike that pour their heart into creating beautiful photos, and we respect that your photos are your photos. Period.

I always want you to feel comfortable sharing your photos on Instagram and we will always work hard to foster and respect our community and go out of our way to support its rights.

Settings Nothing has changed about the control you have over who can see your photos. If you set your photos to private, Instagram only shares your photos with the people you’ve approved to follow you. We hope that this simple control makes it easy for everyone to decide what level of makes sense.

I am grateful to everyone for their feedback and that we have a community that cares so much. We need to be clear about changes we make — this is our responsibility to you. One of the main reasons these documents don’t take effect immediately, but instead 30 days from now, is that we wanted to make sure you had an opportunity to raise any concerns. You’ve done that and are doing that, and that will help us provide the clarity you deserve. Thank you for your help in making sure that Instagram continues to thrive and be a community that we’re all proud of. Please stay tuned for updates coming soon.


Kevin Systrom co-founder, Instagram

* * *

In other words Instragram may not sell your photo outright. Instead, it will contextualize it, re-package it, and use it to sell advertising, without giving you a penny. Oh, and while it is certainly not Instagram intention to do so, it may still sell it…

All better now?



The Universal Depression Is Nigh: ‘Cosmic GDP’ Crashes 97% As Star Formation Slumps

Submitted by Global Macro Monitor

The Collaspe In Cosmic GDP


Peak oil.  Peak food production.  Now (11 billion years ago) peak star production.

The Royal Astronomical Society writes,

Cosmic GDP’ crashes 97% as star formation slumps


While parts of the world experience economic hardship, a team of Portuguese, UK, Japanese, Italian and Dutch astronomers has found an even bigger slump happening on a cosmic scale. In the largest ever study of its kind, the international team of astronomers has established that the rate of formation of new stars in the Universe is now only 1/30th of its peak and that this decline is only set to continue. The team, led by David Sobral of the University of Leiden in the Netherlands, publish their results in the journal Monthly Notices of the Royal Astronomical Society…


Dr Sobral comments: “You might say that the universe has been suffering from a long, serious “crisis”: cosmic GDP output is now only 3% of what it used to be at the peak in star production!”

The decline in the universe’s star production appears structural and secular to us. Could be cyclical depending on your time horizon, however.

The universe must be suffering from not enough demand, too much austerity,  and thus needs the cosmic central bank to engage in some QE.   That is,  Quasar Easing.

Krugman, weigh in!

Hat tip Guardian Science via Twitter.

Japan’s NO EXIT Strategy

Wolf Richter

One of my sources in Japan was told about a yearend Bonenkai party where an official from the Ministry of Finance, the most powerful ministry at the core of Japan Inc., had let slip some things, perhaps after one too many drinks. He confirmed the view propagated by the Liberal Democratic Party, the victor in Sunday’s election, that the Bank of Japan wasn’t doing its job, that it was just giving away money to the banks which then bought Japanese government bonds instead of channeling it into the real economy.

“That’s why the Ministry of Finance is trying to gain control over the Bank of Japan,” he said. “The Ministry of Finance has pride in its ability and is much more qualified to run things than the Bank of Japan.”

Turf war. For him and his ilk, independence of the central bank is a non-sequitur. And elected politicians, when they try to bring the powerful bureaucracy under democratic control, are a nuisance. Prime Minister Yoshihiko Noda and his Liberal Democratic Party had attempted to do that. Now they’re out.

So a new government is being formed by the party that ran the show for fifty years after World War II and is responsible for building the very institutions and structures that got Japan to where it is today. With a new prime minister, Shinzo Abe—who’d already been through the annually revolving prime-ministerial door in 2006/2007. This “new” government is going to fix whatever ails Japan by spending even more money and by wrestling control over the printing press away from the Bank of Japan.

Alas, Japan engaged in “quantitative easing” on a massive scale long before the term had been invented. It has followed the most profligate Keynesian stimulus policies for two decades. Well over half of its current budget is paid for with borrowed money. The country is drowning in liquidity. Interest rates have been at zero or near zero for over a decade. And by the end of this fiscal year, gross national debt will hit 240% of GDP, the highest in the world [for how the MoF plans to deal with that debt, read…. Japanese Ministry of Finance To Bondholders: You’re Screwed!].

But the economy, unlike Greece’s, is not in shambles, though it’s not exactly humming either. Unemployment is 4.2%, the low for the year, and down from the all-time high of 5.6% set in 2009. Youth unemployment, while causing all sorts of handwringing, has been improving. One measure: 61% of the high school students to graduate in March (end of school year) have already accepted job offers, up from 58.6% last year. In the US, we don’t even track that.

The overwhelming problem Japan has is of fiscal nature: debt and deficits can no longer be brought under control. Interest rates have to remain at near zero because the state can no longer afford to pay anything beyond that. Public and private pension funds are unable to earn a yield on much of their holdings but must pay out ballooning benefits to ever more retirees while the number of workers who are paying into these funds is shrinking.

Young people have grown up with this scenario, see it every day, know there is no longer a good exit from the debacle. It’s too late. The pile of debt is too big. Promises about job security and retirement are illusory. They work longer hours for less pay than their predecessors, don’t have enough money to move out from home, and consume practically everything they make [ The Pauperization Of Japan].

Their plight has kept Japan competitive—”thanks” to the labor market reforms by Junichiro Koizumi, Prime Minister from 2001 to 2006. More such reforms are on the way. Consumption tax increases have already been passed. If the new government has its way, there will be inflation—final straw for the young, whose wages won’t keep up with it. These are some of the consequences of a deficit-funded joyride by Japan Inc., the current generation of retirees and near-retirees, and other interest groups.

But they’re leaving their mark on young people in unexpected ways. Gender inequality, for example. A legendary issue in Japan. In 1992, when the government first surveyed its citizens on it, 60% agreed with the statement: “Husbands should work outside, while wives stay at home.” The survey was repeated sporadically; each time, the percentage dropped. By 2009, only 41.3% agreed with it—modern times after all. The next survey results were released today: those who thought wives should stay at home jumped 10.3 percentage points to 51.6%. The highest since 1997. A surprising reversal.

Surprising because of its origin. It wasn’t the older generation, but the young: 55.7% of the men in their 20s thought so, up from 34.3%; and a flabbergasting 43.7% of the women in their 20s agreed with it, up from 27.8%. These are not rounding errors or statistical aberrations but enormous shifts in attitudes.

“I suspect young people today are deeply concerned about their future,” explained Prof. Kakuko Miyata of Meiji Gakuin University, an expert on social psychology. He fingered the economic malaise young people are stuck in and added that “they may wish for the home to be a source of emotional support.” Well, instead of starting businesses to getting things going.

As for me, my let’s say uneven relationship with Japan, or more precisely with Tokyo, started in France with a Japanese girl. A “funny as hell nonfiction book about wanderlust and traveling abroad,” as a reader tweeted. Read the first few chapters of… BIG LIKE: CASCADE INTO AN ODYSSEY at Amazon.