Will the Blackberry Sink the Presidency?

Distraction, interruption, addiction: there is evidence the iconic handheld can change the way we think. But it all depends on how you use it.

By Sharon Begley

And a great cry arose from all across the land: in business offices where managers flashed back to important details they had missed during meetings; in cubicles where wage slaves recalled the countless hours lost trying to figure out what they were doing just before the interruption; at power-lunch spots from Manhattan to Malibu where patrons mourned the relationships they had sundered with their habit; in homes where spouses seethed over the third party in their bed; in labs where scientists studied the impact of technology on thinking; on train platforms where commuters wistfully recalled the days when they spent their wait mulling, pondering and daydreaming. That cry, uttered in response to the news that President Obama was getting to keep his beloved BlackBerry, sounded like this:

Uh-oh.

Technology has affected the way people think, interact and make decisions ever since Homo erectus mastered fire and, for the first time, had a way to keep surplus mammoth from rotting. Result: cooperative hunting. The cognitive and social effects of the BlackBerry on its 21 million users aren't so unambiguously beneficial. So while legions of BlackBerry fans cheer Obama's success in keeping his, insisting it makes users more productive and connected, experts in cognitive psychology and in human-machine interactions who study pop-ups, e-mail alerts, calendar reminders and instant messaging—the most intrusive and ubiquitous pre-BlackBerry technologies—have two things to say: distraction overload, and continuous partial attention. For whatever the virtues of a handheld, there is no question that, depending how you use it, you risk never focusing exclusively on any thought or perception for long and never being able to work straight through to completion on anything. That's OK for tasks you can handle with half your cerebral lobes tied behind your back. It's less fine when the task is, say, watching for track signals while operating a train.

How damaging an interruption is depends on when it occurs. In a 2004 study, scientists led by Brian Bailey of the University of Illinois had volunteers edit text and search the Internet while being interrupted by news alerts. It was much less annoying to be interrupted between what the scientists call "coarse breakpoints," such as at the completion of a paragraph or thought. Not only is it easier to jump back into the previous task after the interruption, but when you are not trying to keep in your head what you need to finish a task you can pay more attention to the interruption itself. If you answer the BlackBerry's call at natural breakpoints, you're much more likely to be able to take in the e-mail and then resume what you were doing without that "where was I?" brain lock. In some demanding tasks, however, there may not be any natural breakpoints. Pilots who are interrupted during a preflight checklist sometimes miss an item when they try to pick up where they left off, notes psychologist Deborah Boehm-Davis of George Mason University, who studies interruptions. Last summer's crash of an airliner taking off from Madrid was apparently the result of an interruption-induced error; 153 people died.

There are no good studies on how often BlackBerry users let themselves be interrupted by its seductive call, but research on other electronic interruptions is not encouraging. When Gloria Mark, professor of informatics at the University of California, Irvine, shadowed employees at two high-tech firms, she found that the average worker spends only 11 minutes on any given project before being interrupted and asked to do something else. IT workers have it worse, switching attention every three minutes, on average. The BlackBerry (which isn't nicknamed CrackBerry for nothing) is way more seductive than, say, e-mail alerts. Thanks to its growing social and cultural cachet, it can make the most inconsequential middle manager feel as important as the CEO who must always be reachable, and it can feed the illusion of the lowliest salaryman that his input is so central he must be thumbing away at the dinner table and on vacation.

The distraction of almost-irresistible interruptions has been the killer app, so to speak, for some BlackBerry newbies. Sen. Thad Cochran of Mississippi, like almost every politician on the Hill, got a BlackBerry after 9/11 for security purposes. But he gave it back. "I was always distracted," Cochran said. "I couldn't concentrate. Every time the light came on or it beeped, I felt this compulsion to stop everything I was doing." Though he doesn't begrudge his colleagues for their addiction, Cochran says the result is that during meetings on the Hill almost everyone is "always checking messages" or typing, he says. "It just beeps or buzzes, all the time, and people get up and leave the room."

Interruption overload can impair higher cognitive functions, too, starting with decision making. It takes time to bring your mind back to the task you left when the BlackBerry called, which means (if that task was listening to someone, for instance) you have missed more than occurred during just the seconds it took to read an e-mail. People take about 15 minutes to productively resume a challenging task when they are interrupted even by something as innocuous as an e-mail alert, scientists at Microsoft Research and the University of Illinois found in a 2007 study. The delay may reflect how long it takes to reactivate memories about the task and to "refocus cognitive resources that may have been usurped" by the interruption, they reported. If this delay causes you to miss key information, then you are basing a decision on incomplete knowledge, something even BlackBerry lovers understand. Sen. Robert Menendez of New Jersey, for instance, was spotted last year typing on his BlackBerry as he gaveled the debate on the Senate floor. "I've got a lot of traffic and action going on, and it helps me keep track of it all," he said. But he turns it off during crucial hearings and meetings, recognizing that it impairs his concentration and could make him miss key information.

Interruptions can also derail brain processes that sort incoming signals. Information first lands in short-term memory, but if it is to stay with you for the long term it must be encoded—put in the right mental file drawer. That process requires a few minutes, and, if interrupted, can be short-circuited. "Being forced to divert attention to interrupting messages," scientists in Finland concluded in a 2004 study, "can cause memory loss" and "decreased memory accuracy." If new information is not indexed correctly, some of what the brain has stored about, say, TARP will be inaccessible; it's there, but you've failed to construct the neuronal road map needed to find it.

The more brain power an interruption demands, the more disruptive it will be to the task it is pulling you away from. If dealing with the interruption requires so little concentration that you are still able to unconsciously "rehearse" the task you broke away from, be it programming your TiVo or walking into a room to retrieve something, you will do a better job on that task when you return to it. If the interruption requires significant mental effort, however, rehearsal breaks down and the subconscious cannot keep repeating, "I walked into this room to get my wallet." Hence the feeling of "What'd I come in here for?!"

Continuous partial attention is actually a misnomer. Computer scientists use it, but most psychologists disdain it because what seems like partial attention or multitasking is actually rapid-fire switching of attention among tasks. In that state of mind, says computer scientist Mary Czerwinski of Microsoft Research, you don't process information as fully and are not using your frontal lobe effectively.

A BlackBerry can have detrimental effects even, or especially, when users turn it on when they are doing "nothing." That "nothing" is what our pre-BlackBerry forebears called daydreaming, which is a propitious mental state for creativity, insight and problem solving. Truly novel solutions and ideas emerge when the brain brings together unrelated facts and thoughts. That is hard to achieve when you are attacking the problem head on. Because the idea of "buying music" is associated with specific thoughts that you have thought every time you've pondered that act, thinking directly about it sends brain signals along the same well-worn neuronal roads, arriving at the same oft-visited nodes. But daydreaming or thinking about something else keeps the signals off those rutted roads and allows far-flung facts and ideas to combine in novel ways, producing, say, iTunes. Hence the common experience of an "aha" moment of creativity or insight about some problem when it is not commanding your conscious attention. If mental downtime becomes BlackBerry time, eurekas will be rarer.

When Teresa Amabile of Harvard Business School studied 238 people working on projects that required creative solutions, she found that fragmentation of attention also impeded creativity. Time pressure typically had the same effect, unless attention was focused on a crucial problem. (A surge of adrenaline can ramp up mental processes.) The NASA engineers who came up with a duct-tape-and-spit solution to Apollo 13's crisis in 1970 faced crushing time pressure—the three astronauts would die if NASA did not find a way to filter out carbon dioxide in the air, reconfigure power use and put the spacecraft on a new return trajectory within days. But they had no distractions (the brass at Mission Control shielded them from all interruptions) and their attention was totally focused, as thoughts of death tend to do.

Given the damage caused by interruption overload and continuous partial attention, we can infer either of two things about people who use their BlackBerry while holding a conversation, weighing decisions, trying to solve a problem or attempting to do creative work with, they claim, no ill effects. Possibility one: they are lying. Possibility two: their work just isn't that hard. Yes, you can schedule meetings. No, you cannot craft a smart stimulus bill. One wonders whether financiers who did not comprehend the esoteric derivatives they were selling (as Robert Rubin, former co-chairman of Citigroup, told NEWSWEEK last year) might have understood them if they had given the guys who invented them their full and undivided attention, rather than BlackBerrying during presentations. But we're just guessing here.

Obama will be spared the worst consequences of continuous partial attention and interruption overload for the simple reason that he agreed to cut way back on his BlackBerry habit, using it mainly to stay in touch with family, close friends and top advisers. Although the White House declined to say when and where he will use his BlackBerry or even have it on, sources say it is off during briefings and meetings. Several lawmakers who have met with Obama privately in recent weeks tell NEWSWEEK they haven't seen him with it—"and I was looking," said one Republican senator.

BlackBerry fans who cheered Obama's victory over those who would take it away from him assume that the leader of the free world will be shielded from the damaging cognitive effects it can have on mere mortals. Roger McNamee, managing director of the Silicon Valley venture-capital firm Elevation Partners, had nothing but scorn for the suggestion that a BlackBerry might pose problems in the Oval Office. "You just turn notification off—that's what everybody does—and it doesn't bother you at all," he told NEWSWEEK's Daniel Lyons. "I do not allow notifications for e-mail, text or any other application. As a result, the devices are not a distraction." Even Senator Menendez, who recognizes that an insistent BlackBerry is not something you want when witnesses at a hearing are trying to explain the arcane details of, for example, toxic bank assets, says, "The bottom line is, I couldn't imagine accomplishing all the things I need to do without it." (Viacom's Sumner Redstone and News Corp.'s Rupert Murdoch, however, apparently have no trouble imagining it: neither is known to use a handheld.)

In Obama's case, however, it is hard to see how the man who is never farther from an aide than his pillow is to the bedroom door is in any danger of being unconnected from the people and information he needs for his job. "He's not getting important facts on it—he's probably staying in touch with his buddies," speculates Rep. Anthony Weiner of New York, himself an admitted BlackBerry addict. "I'm sure he's much more likely to glance down to see how the Steelers are doing and stay connected than to use it for work. I'm not concerned that the president will be distracted. But the next time he's at a state dinner and glances down under the table, he's much more likely to be BlackBerry-ing his wife 'When can I leave' than anything official."

At least Obama shouldn't have to worry about one detrimental effect of BlackBerry interruptions. The stress and hence the cognitive damage caused by e-mail, text and similar intrusions are inversely related to a person's self-esteem and to how much control he perceives he has over his working environment, scientists in Scotland reported in 2006. Obama has not shown many signs of low self-esteem. Similarly, people who feel they are at the whim of individuals and forces beyond their control tend to suffer the worst consequences of interruption overload. Lowly personal assistants who are constantly juggling the boss's BlackBerry texts and e-mails, terrified of missing an important one, have the most trouble returning to what they were doing before the BlackBerry trilled, and suffer the worst cognitive lapses. If you're the most powerful man in the world? Not a worry.

Via:

www.newsweek.com

Will the Blackberry Sink the Presidency?

Suicidal behavior may run in families

The poet Sylvia Plath, who made a name for herself through prose and poetry that conveyed a sense of depression and suicidal tendencies, famously died by asphyxiating herself in an oven in 1963.


The best way to prevent suicide is to treat the underlying psychiatric disorder, says Dr. David Brent.

The recent reported suicide of her son, marine biologist Nicholas Hughes, brings to light a known psychiatric phenomenon: the heredity of suicidal behavior.

A first-degree relative -- a parent, sibling or child -- of a person who has committed suicide is four to six times more likely to attempt or complete a suicide, said Dr. David Brent, psychiatrist at the University of Pittsburgh Medical Center.

Studies on twins have shown that suicidal behavior is between 30 and 50 percent due to heritable factors, he said. Suicide victims' biological relatives who were adopted away also show an increased risk of suicide, he said.

The rate of suicide in America is 10.9 suicide deaths per 100,000 people, according to the latest information from the National Institute of Mental Health. That means, although the likelihood of suicidal behavior increases in families, a completed suicide is still a rare event, Brent said.

"Genetics is not destiny," he said. "The odds are still very much against you having this happening to another relative."

Family history of suicide and family history of mental disorder are two risk factors that the National Institute of Mental Health lists.

More than 90 percent of people who die by suicide have depression or another mental disorder, or a substance abuse disorder in combination with another mental problem, according to the National Institute of Mental Health. Learn about the link between depression and creativity

Research shows that depression runs in families.

A new study in the Proceedings of the National Academy of Sciences shows biological markers for the inherited condition. The researchers found, in a sample of 131 people, that the biological offspring of depressed people had structural differences in their brain. Some of these people had been followed for more than 25 years. Learn more about mood disorders »

People at high risk of developing depression had a 28 percent thinning of the right cortex, the brain's outermost surface, the study found. Those with an extra thinning abnormality in the left cortex were most likely to develop depression or anxiety.

The data set shows that this brain surface thinning was present before these people developed mental problems, and was found in both children and grandchildren of depressed people, said Dr. Bradley Peterson, psychiatrist at Columbia University Medical Center and co-author of the study.

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The new study may point toward more individualized medicine -- one day people may be screened for these brain abnormalities that indicate high depression risk, and receive treatment based on that, he said.

Researchers believe the cortical thinning causes depression by interfering with the processing of emotional stimuli, he said. A person with these brain abnormalities may benefit from therapy targeted at responding to social stimuli more appropriately, he said.

With both depression and suicide, research suggests that causal factors are a combination of genetics and environment, Peterson said.

The best way to prevent suicide is to treat the underlying psychiatric disorder, Brent said.

Besides Hughes and Plath, famous examples of two or more close relatives committing suicide include Ernest Hemingway's family -- Hemingway's father, brother, sister and granddaughter, in addition to the famous novelist himself, killed themselves.

The poet John Berryman jumped off a Minneapolis bridge in 1972; his father had committed suicide when the poet was a child. More recently, the playwright Spalding Gray apparently killed himself in 2004; his mother had taken her own life many years earlier.

Do relatives of people who killed themselves imitate suicide? This is possible, but hard to prove or disprove, Brent said. In fact, there is more evidence of copycat suicides among people who did not know the victim well, but merely learned about him or her through the news.

If you've actually lost a relative to suicide and go through the bereavement process, you may be more likely to understand the aftermath of suicide, Brent said.

Suicide "can also represent the learned or transmitted way of coping with unbearable stress," Peterson said.

What exactly gets transmitted in families with suicide? One theory is that it's a difficulty in emotional regulation.

"Not necessarily depression per se, but it's the ability to restrain yourself from acting on suicidal thoughts," Brent said.

Via:

www.cnn.com

Suicidal behavior may run in families

Legends' Last Songs and Epitaphs

Have you ever wondered what songs the legends sang just before they die? Did they feel that something was going wrong and the end was getting closer? These are impossible questions since we can never know if Lennon was whistling any of his latest songs while he was walking towards the apartment Dakota or Cobain singing anything just before he pulled the trigger... etc. But at least, we can follow the clues and reveal their psychlogical situations the day they died and this may help us to learn much about them.

You Know You Are Right - Kurt Cobain (Nirvana)
(February 20, 1967 - April 5, 1994)

Kurt wrote this song as a sarcastic reference to his wife Courtney Love, at a very turbulent time in their relationship (shortly before his suicide), the title and predominant lyric: "you know your right" and also "nothing really bothers her, she just wants to love herself", both refer to Kurt's frustration with Courtney.

On April 8, 1994, Cobain's body was discovered at his Lake Washington home. A suicide note was found that said, "I haven't felt the excitement of listening to as well as creating music, along with really writing . . . for too many years now" with a shotgun pointing at his chin. A high concentration of heroin and traces of Valium were also found in his body.

Since the group recorded the song when they had some spare time one weekend, it went unreleased after Cobain suddenly died.

A Change is Gonna Come - Sam Cooke
(January 22, 1931 - December 11, 1964)

Cooke was deeply affected by the death of his infant son, who drowned in a swimming pool in 1963. He started writing more introspective songs and took an interest in black history and politics.

The song was released as a single a few months after Cooke died. He was shot by a motel owner who claimed he was raping a young girl in one of the rooms. A lot of controversy surrounded his death; Cooke owned his own record label and publishing company, and some people thought he was killed as part of a plot.

"There been times that I thought I couldn't last for long
But now I think I'm able to carry on
It's been a long, a long time coming
But I know a change gonna come, oh yes it will"

Voodo Child - Jimi Hendrix
(November 27, 1942 - September 18, 1970)

This was the last song Hendrix performed live. On September 6, 1970, which was 12 days before his death, he played it at a concert in Germany.

Hendrix's last public performance was an informal jam at Ronnie Scott's Jazz Club in Soho with Burdon and his latest band, War.

Early on September 18, 1970, Jimi Hendrix died in London in a Hotel under the circumstances which have never been fully explained.

Redemption Song - Bob Marley
(February 6, 1945 - May 11, 1981)

Marley completed his last album in the summer of 1980. He was suffering from the cancer that would eventually kill him at age 36, but was very productive in his later years. He refused traditional medicine because of his Rastafarian beliefs and chose to make music and perform as long as he could.

This was the last song Marley performed. He sang it from a stool at a show in Pittsburgh on September 23, 1980.

"Won't you help to sing
These songs of freedom? -
'Cause all I ever have:
Redemption songs;"

Mercedes Benz - Janis Joplin
(January 19, 1943 - October 4, 1970)

The last recordings Joplin completed were "Mercedes Benz" and a birthday greeting for John Lennon ("Happy Trails", composed by Dale Evans) on October 1, 1970. On Saturday, October 3, Joplin visited the Sunset Sound Studios in Los Angeles to listen to the instrumental track for Nick Gravenites' song "Buried Alive In The Blues" prior to recording the vocal track and scheduled for the next day.

She failed to show up at the studio by Sunday afternoon, producer Paul Rothchild became concerned. Full Tilt Boogie's road manager, John Cooke, drove to the Landmark Motor Hotel (since renamed the Highland Gardens Hotel) where Joplin had been a guest since August 24. He saw Joplin's psychedelically painted Porsche still in the parking lot. Upon entering her room, he found her dead on the floor. The official cause of death was an overdose of heroin, possibly combined with the effects of alcohol.

To Live is To Die/Anesthesia Pulling Teeth - Cliff Burton (Metallica)
(February 10, 1962 - September 27, 1986)

Fresh from their triumphant UK tour, Metallica had headed once more for Scandinavia where they'd played three shows at the Olympen in Lund (September 24, 1986), the Skedsmohallen (September 25, 1986) in Oslo and at the Sonahallen in Stockholm (September 26, 1986). The last song of Cliff Burton was also his latest solo bass performance "Anesthesia Pulling Teeth" in the concert. It was approaching dawn on Saturday, the 27th of September 1986, and Metallica's two tour buses were on their way to do a fourth show in Copenhagen. The were traveling along a god forsaken road between the Scandinavian cities of Stockholm and Copenhagen. Apart from these vehicles, the route was deserted, there was no one else traveling at that early hour of the morning. Suddenly, for no apparent reason, just before dawn, at about 5:15 am, one of the coaches swerved violently to its right and started careening wildly down the wrong side of the road. It was out of control, and a crash was inevitable. Cliff Burton was thrown through the window of the bus, which fell on top of him causing his death.

Swedish police arriving on the scene of the accident immediately arrested the driver as a matter of routine. They later released him without charging him after further investigation revealed that the cause of the accident was black ice on a nasty bend in the road.

James Hetfield later stated that he first believed the bus flipped because the driver was drunk, claiming he had smelled alcohol on the driver's breath after the accident. Hetfield also stated that he himself had walked long distances down the road looking for black ice and had found none. Local freelance photographer, Lennart Wennberg, who had attended the scene of the crash the following morning, when later asked in an interview about the likelihood of black ice being the cause of the accident said that it was 'out of the question', stating that the road had been dry and the temperature around zero degrees Celsius. This was also confirmed by the police who also found no ice on the road.

"To live is to die" is a tribute to Metallica's bassist Cliff Burton. It is instrumental except the spoken word piece near the end - this was a poem that Cliff wrote before he died.

When a man lies he murders
Some part of the world
These are the pale deaths
Which men miscall their lives
All this I cannot bear To witness any longer
Cannot the kingdom of salvation
Take me home

The Best is Yet to Come - Frank Sinatra
(December 12, 1915 - May 14, 1998)

Sinatra's final public concerts were held in Japan's Fukuoka Dome in December 1994. The following year, on February 25, 1995, at a private party for 1,200 select guests on the closing night of the Frank Sinatra Desert Classic golf tournament, Sinatra sang before a live audience for the very last time. His closing song was "The Best is Yet to Come."

After suffering heart attack, Frank Sinatra died at 10:50 pm on May 14, 1998 at the Cedars-Sinai Medical Center, with his wife Barbara by his side. He was 82 years old and Sinatra's final words, spoken as attempts were made to stabilize him, were "I'm losing."

The words The Best Is Yet to Come are imprinted on Sinatra's tombstone. But one of his songs "My way" soon became the most requested song by men to be played at their funerals.

Walking On Thin Ice - John Lennon
(9 October 1940 - 8 December 1980)

On the night of 8 December 1980, at around 10:49 p.m., Mark David Chapman shot Lennon in the back four times in the entrance of the Dakota and Lennon died immediately on the event scene.

The last song of his own that John ever recorded was "I Don't Wanna Face It," recorded on September 2nd but never fully finished by John; it appears on the CD Milk and Honey. The last song Lennon played on was probably Yoko's "Walking On Thin Ice," which appears on her album Season Of Glass; he was working on it at the time of his death. The last recordings he ever made at home, however, were four new songs recorded as demos at his Dakota residence on November 14th. Two, "Pop Is The Name Of The Game" and "You Saved My Soul," have never been officially released. The other two, "Dear John" and "Serve Yourself," were released on 1998's Lennon Anthology.. The lyrics of "Dear John" consist mainly of this verse:

Dear John,
don't be hard on yourself.
Give yourself a break.
Life wasn't meant to be run.
The race is over, you've won.

Blue Eyes Crying In The Rain - Elvis Presley
(January 8, 1935 - August 16, 1977)

Presley's final performance was in Indianapolis at the Market Square Arena, on June 26, 1977. According to many of his entourage who accompanied him on tour, it was the "best show he had given in a long time" with "some strong singing".

Another tour was scheduled to begin August 17, 1977, but at Graceland the day before, Presley was found on his bathroom floor by fiancée, Ginger Alden. According to the medical investigator, Presley had "stumbled or crawled several feet before he died"; he had apparently been using the toilet at the time. Death was officially pronounced at 3:30 pm at the Baptist Memorial Hospital.

Although Elvis appeared pale, weak, and overweight, as he had with increasing regularity, there was nothing to suggest his impending death -- indeed, there was nothing unusual about his show on the tour, except that Elvis for some reason introduced practically everyone from his life on stage that night. Some take this as "proof" Elvis knew he was in his final days; others maintain that he was worried about the imminent publication of Elvis: What Happened?, a tell-all biography by former bodyguards Sonny and Red West that publicly broke the story of his drug abuse, and what those revelations might do to his image.

The last recording Elvis made was a vocal overdub on "He'll Have To Go" on October 31st, 1976 in the "Jungle Room" at his home at Graceland.

The last song Elvis performed in private was a rendition of "Blue Eyes Crying In The Rain," on his piano in Graceland hours before his death.

In the twilight glow I seen her
Blue eyes crying in the rain
When we kissed goodbye and parted
I knew we'd never meet again
Love is like a dying ember
And only memories remain
And through the ages I'll remember

Blue eyes crying in the rain

A Winter's Tale/Mother Love - Freddie Mercury (Queen)
(5 September 1946 - 24 November 1991)

October 8th 1991 was the last time Freddie Mercury performed on stage. At the time, he was terribly ill with AIDS, although he didn't want people to know about it. He announced that fact the day before he died. Being ill he continued to compose and record songs and even took part in making videos (ex: "I'm Going Slightly Mad" video)

On November 24th, 1991 Freddie died peacefully at his home in London of AIDS-related bronchial pneumonia.

"A Winter's tale" and "Mother Love" was the two songs he cannot find time to complete recordings. Queen guitarist Brian May in the name of the band Queen sang the rest of the lyrics and published in Queen's 1995 album "Made in Heaven".

Freddie mercury did not officially have a grave. He was cremated and the whereabouts of his ashes remains a mystery. It has been said that they are buried under the cherry tree in his garden, at garden lodge. It has also been said that they were scattered at Lake Geneva, a place where Freddie had an apartment, and a place where he found great peace.

My body's aching, but I can't sleep
My dreams are all the company I keep
Got such a feeling as the sun goes down
I'm coming home to my sweet -
Mother love

Via:

http://kuday-eng.bloggum.com

Legends' Last Songs and Epitaphs

When China and Brazil Become a Better Investment Than the U.S.

Now that most investors, both institutional and individual, have lost a large portion of their stock market holdings, all that most people want to know is how they can get their money back. The easy answer is that they probably won't get their money back, at least not over the next five or ten years. But, that kind of answer is never satisfactory.

One well-known market analyst suggests that putting money into the stock markets in China and Brazil will pay off better than keeping capital in U.S. equities. According to Reuters, Mohamed El-Erian, chief executive at Pimco, the world's biggest bond fund manager, said about China and Brazil, "The case for optimism comes from the fact that these countries entered today's global crisis with better initial conditions." (See pictures of the global financial crisis.)

In horse racing and boxing, experts will point out that a strong start does not mean a strong finish. China is a case in point. Its GDP has grown at a rate of about 10% a year for a decade. The government has done whatever it needed to do to keep the economy on track. It has underwritten the build-up of the manufacturing sector, the telecom and electric infrastructure, and a large and complex financial system. It has also sold parts of the nation's largest companies to the public to give the companies more access to capital. The communist central government says it will put about $585 billion into the domestic economy in order to stimulate consumption and business expansion.

It is hard to see how China could fail with its plans to keep its GDP growing rapidly with such an impressive arsenal. It looks almost as good as the one that the U.S. had in the 1920s and Japan did in the 1980s.

Of course, the Chinese economic leaders have read all of the analysis about what caused economic collapses in large nations during the past. China has certain advantages that have never been present in another rapidly growing country. The country has both an abundance of national resources and a large supply of workers who can be trained to work in factories. China has also grown and continues to grow with virtually no restrictions on how industry effects the environment. The World Bank estimated that 700,000 Chinese die prematurely due to poor air quality. Perhaps the best way to look at that number is that it is the price of progress.

China has obviously demonstrated that it has both the will and the capacity to exceed the growth of any other large nation in the world. But, what is rarely if ever mentioned by the government is that the nation's economic fate is not in its own hands.

Recently The Wall Street Journal reported that "Goldman Sachs estimates that China's economy grew 2.6% in the October-December period from the July-September quarter. The OECD puts the quarter-on-quarter growth for the same period at 0.3%." The numbers are telling in two ways. The first is that estimates of economic activity on the mainland are imprecise. The second is that China's growth rate may have already have slowed considerably.

None of the current explanations of China's GDP growth are able to explain the discrepancy between China's GDP growth and the sharp drop in imports among the developed nations. China does not have another set of nations that it can send its goods in order to replace the diminished demand from the U.S., Japan, and Europe. As unemployment in these regions continues to rise, and that looks like a certainty now, China's ability to send its manufactured goods overseas drops each month.

So far this year, the Shanghai Composite, the best measurement of stock values in China, is up over 20%. Those making the argument that the world's most populous nation will have a strong year can point to that number as an indication of optimism. The trouble with the theory is that when the Asian nation's economy was at its most robust, in 2007 and early 2008, the same index of China's stock fell from a level of 6,000 to 1,700 where it bottomed five months ago. This must be what the head of Pimco meant when he said that investing in Chinese stocks is the best game in town.

Via:

www.time.com

When China and Brazil Become a Better Investment Than the U.S.

World Bank: Crisis Hits Developing Nations Harder

Economists and public officials need to be optimistic about the economy. It they are too dour, they just encourage the public to think that they should be replaced. Economists, after all, might be considered a luxury in a down economy. Politicians who predict only hopelessness may be seen as ineffective stewards of their country's finances.

So far, the great majority of analysts and world leaders have said that, while some nations will experience economic contractions this year, the world as a whole will continue to have aggregate GDP improvement. The usual argument is that the strength of large, emerging nations like China and India will offset trouble in the U.S., E.U., U.K., and Japan.

The World Bank is having none of it. According to The New York Times, "In a bleaker assessment than those of most private forecasters, the World Bank predicted that the global economy would shrink in 2009 for the first time since World War II."

In the report, called "Crisis Reveals Growing Finance Gaps for Developing Countries", the organization makes three critically important points. The first is that as developed nations like the U.S. go into the debt markets to finance deficits, they crowd out smaller nations which have much worse debt ratings, effectively denying them access to the capital markets. The next problem is that poor nations will need to depend more on richer ones for items that are essential such as food and medical supplies. The last point is that global industrial production could be down as much as 15% by the middle of this year, compared with 2008, making the strength of the Chinese and Indian economies less dependable.

Taken together, the problems are a Rubik's Cube without an apparent solution. Developed countries with falling GDP and shrinking industrial production may not have the financial resources to right their own economies, and may choose not to afford to help nations which have the unimaginable issues of feeding and housing their impoverished citizens. (Watch a TIME video with the creator of the Rubik's Cube.)

The only immediate solution to this crisis would appear to be a form of global socialism where some portion of the money available though the debt markets to countries like the U.S. and Japan would be funneled to nations like Cambodia and Ukraine. But, recessions have tended to move nations toward Darwinism and away from generosity to those outside their own borders.

The World Bank message is simple but is likely to fall on deaf ears. The natural urge to protect one's own country is likely to trump the act of giving, and getting around that is nearly impossible.

The fact that poor countries can and will be crushed under the wheel of the global recession makes one point extremely clear. There is no league of nations, nor has there ever been one, perhaps because the interests of the largest powers are too widely separated. Since there is no forum to address the issues that could undermine the future health of all countries, the current lack of cooperation becomes a form of fatalism.

The most convenient way for the developed nations to look at the global economic problem is that there is nothing that can be done to prevent some poor nations from disappearing. Other third world nations will return to financial and business infrastructures prevalent decades ago.

It is almost certain that some of the weakest nations in the world will be destroyed by the current economic calamity. It is astonishing that no one in the developed countries has had the courage to speak this truth. That would at least give those countries, likely not to survive, the knowledge that no help is coming. At least, then, they could desperately try find an alternative to outside aid.

Via:

www.time.com

World Bank: Crisis Hits Developing Nations Harder

What Woud Marx Think?

The book has been on the best-seller lists in Germany for nine weeks, and in the provincial town of Trier it has special resonance, especially in tough economic times. It's Marx's Das Kapital, and dozens of copies of it are laid out in the bookshop in Trier's pedestrian-only town center. But no, this is not the seminal 19th century work on political economy by Karl Marx, who was born in Trier in 1818. It's a book by Reinhard Marx, the former Roman Catholic Bishop of Trier who is now Archbishop of Munich and Freising. He cheekily borrowed the title for his own thesis, namely that today's troubled economy needs to reconnect with fundamental Christian values if it is to be restored to health. The book's introduction is a letter to Reinhard's celebrated namesake in which he rejects revolutionary Marxist solutions. Nonetheless, as he surveys the wreckage of the global financial system and the growing insecurity of ordinary people, the Archbishop wonders: Was Marx's critique of capitalism right after all? "It lasted longer than you expected back in the 19th century," he writes, "but could it be that capitalism is just an episode of history that will end at some point because the system will collapse as a result of its internal contradictions?"

The Archbishop is not alone. From Washington to Vladivostok, the task of warding off financial collapse and economic depression is now the overwhelming priority for government leaders, central bankers and regulators everywhere. Solutions differ, but all agree that the current situation is both dire and extremely perplexing: nobody younger than 80 has experienced such a rapid decline in global confidence and economic activity. Markets have failed, and in so doing they have destroyed the conventional wisdom about how to run an efficient economy. It's as if an intellectual fog has descended, and the global positioning system has broken down, leaving the world to grope its way out as best it can. "Ask the experts what to do," says Tony Blair, the former British Prime Minister, "and the most honest reply is 'I don't know.' "

Searching the library for ideas, many have rediscovered the 1930s policy prescriptions of John Maynard Keynes, who advocated massive government spending programs of the type now being promoted by U.S. President Barack Obama, British Prime Minister Gordon Brown and others. Other great thinkers of the past are also being rediscovered, from Adam Smith to John Kenneth Galbraith. But hovering out there in the fog, unavoidably, is the towering specter of Karl Marx, the grandfather of political economists, whose damning critique of capitalism's inadequacies played an outsized role in world history for a century after his death in 1883.

Marx's utopian predictions about revolution and the triumph of socialism were dead wrong; indeed, many of the policies carried out in his name in the 20th century brought misery to millions in countries ranging from Russia to China, and including large chunks of Africa. Yet 20 years after the fall of the Berlin Wall and Soviet-style socialism, it's still instructive to take the Karl Marx road trip around Europe, starting in Trier and ending up where he ended, in London. It's instructive because if you leave aside the prophetic, prescriptive parts of Marx's writings, there's a trenchant diagnosis of the underlying problems of a market economy that is surprisingly relevant even today. Marx, too, lived through an era of rapid globalization. (A famous passage in The Communist Manifesto, which he wrote with Friedrich Engels in 1848, is almost uncannily prescient about globalization's costs and benefits.) He was moved by glaring inequalities between rich and poor that are more topical than ever today. He thought work should bring personal fulfillment, and that labor should not be treated as a simple commodity — foreshadowing today's controversies over outsourcing and poor working conditions in developing countries. He wondered whether the middle class would be squeezed out of existence. And he identified how profits were taking an ever bigger share of the economy at the expense of wages, just as they are once again today.

There's another reason why a journey through the places that marked Marx's career is worthwhile. The intellectual debate about how to fix capitalism to ensure a more stable and just economic system is particularly lively in the three countries where he spent most of his life — Germany, France and Britain. Some version of this debate is taking place everywhere, of course, including Washington, where a new President is bringing in a new team with fresh ideas. It will also top the agenda at this year's annual meeting of the World Economic Forum in Davos. It's a difficult, nuanced debate, and even within those three European countries there are starkly differing visions. Yet there's a strong sense that a new road map is needed. If governments "are not in a position to show that we can create a social order for the world in which such crises do not take place," warns German Chancellor Angela Merkel, "then we'll face stronger questions as to whether this is really the right economic system."

There's a lot about today's mess that Marx couldn't have predicted, of course, from credit-default swaps and subprime mortgages to global economic imbalances. The capitalism of today, for all its failings, is far removed from the cruder version that Marx analyzed, before the advent of pension and unemployment systems, medical insurance and health and safety legislation. Still, as the Archbishop writes to the bearded one in his own version of Das Kapital: "There's a question that won't leave me in peace: At the end of the 20th century, when the capitalist West defeated the communist East in the battle between systems, were we too quick to dismiss you and your economic theories?"

Pulling on the Same Rope

Karl Marx was born in trier, in a whitewashed three-story house with a courtyard in Brückenstrasse. More than one-third of the 40,000 annual visitors to the house come from China, some as individual tourists but many in groups, such as the delegation of students from a Communist Party academy in Beijing who dropped by recently. Vietnam is the only other nation that still sends official delegations. That's a big change from when the Berlin Wall was still standing and the house was an obligatory stop on the Communist world tour. The director today, Beatrix Bouvier, has a mandate to update the place for the post-Cold War era. She has opted for sobriety. The rooms give factual details about Marx's life, his influences, his friendships, his writings — and his legacy. A top-floor room shows photos of Stalin and the Soviet gulag, the crushing of uprisings in Hungary and Czechoslovakia, the collapse of communism in Eastern Europe and the protests at China's Tiananmen Square in 1989. "A lot of things were done in his name in the 20th century, and we have to live with the consequences," Bouvier says. "Marx is so contested and contradictory. We show him as being many-sided." It's a view that upsets true believers, who sometimes send letters accusing her of being "counterrevolutionary."

Which, in a way, is fair enough. There's nothing revolutionary about Trier itself, a tidy place that takes pride in its Roman heritage. It has quietly prospered in a way that has nothing to do with Marx. Indeed, Trier is a fine example of the traditional postwar German model of capitalism, what the Germans call their "social market economy." Most of the 35,000 firms in the area are tiny, with fewer than 20 employees, but they have thrived on the old-fashioned values of hard work and family ownership. There is close to full employment. The local savings banks know their customers well, didn't dabble in arcane derivatives they didn't understand, and have escaped the financial turmoil of the past few months virtually unscathed. Arne Rössel, director of the local chamber of commerce, says people are nervous about the economy, but firms "are coming from a very comfortable position with good liquidity."

Trier is not immune to the crisis. Several local firms supply the auto industry and have been hurt by its woes. One of the biggest employers makes construction machinery; its orders are down 90%. But at times like this, old-fashioned German capitalism shows its strengths: so far there have been almost no layoffs. About 100 local companies have scaled back their operations or stopped work altogether, but under German labor laws, furloughed workers can continue to receive 80% of their salary for several months even if they're not working. Firms pay a part of the social-security contributions, and the government unemployment agency picks up the rest.

Roland Wölfl, who heads the Trier office of Germany's powerful IG Metall labor union, maintains that employers and union officials are rallying to save jobs. "We're all pulling on the same rope," he says. Like many in Germany, he believes that this social-solidarity system has been badly strained over the past few years, as budget cuts were implemented and American-style practices came into vogue, including a focus on short-term profits over longer-term prosperity, broad deregulation and fast-and-loose finance. In the auto industry, where IG Metall is a powerful force, firms like Volkswagen threatened to move jobs abroad unless workers made big concessions on pay and working hours. But now peace has been restored, and Wölfl says the clock needs to be turned back. "Uncontrolled turbo-capitalism has lost its reason to exist," he says.

Could old-fashioned German values, including consensual labor relations, be a model for others now? At the chamber of commerce, which is housed on the site of a former French garrison, Rössel shakes his head. "I think Germany will get through this crisis better than the U.K. and U.S. because it's less dependent on finance," he says. "But you can't impose a social market economy by law. It developed over decades. It's cultural."

Sarko's Stick

Next stop is Paris, a city that played an important role in Marx's life and work. He moved there in 1843 after tangling with authorities in Germany, and it was there that he met Engels, his intellectual soulmate and collaborator. The French revolts of 1830, 1848 and 1871 strongly influenced Marx's thinking on class struggle and revolution.

These days, the stick that Marx used to beat capitalist excesses has been taken up — albeit more lightly — by French President Nicolas Sarkozy. Even before the financial crisis exploded last fall, Sarkozy was attacking outsized corporate pay packages and "golden parachutes" for fired executives. He has also called for the "moralization" of capitalism, by which he means a greater sense of social and personal responsibility on the part of businesses, a significant reining in of financial speculation and a renewed emphasis on entrepreneurship and work. "I believe in the creative force of capitalism, but I am convinced that capitalism cannot survive without an ethic, without respect for a number of spiritual values, without humanism, without respect for people," the French President said in a February, 2007 speech that articulated a critique he has since considerably strengthened. This month Sarkozy talked about how the public was "scandalized" by highly paid bankers' lack of accountability for the financial system's woes.

Such rhetoric plays well in France, where public opinion has long been skeptical about free markets and globalization — and where the founding Republican principle of égalité is viewed as paramount. France has actually benefited from globalization; one in seven people in the country is employed by a foreign company that has invested in the country, and large French firms such as l'Oréal and Danone have boosted their profits as a result of their global reach. But some of the fears are well founded. Globalization has brought massive pressure on wages in developed countries and a widening gulf between the rich and everyone else around the globe. Executive pay has soared: according to a study by the International Institute for Labour Studies, the CEOs of the 15 largest companies in Australia, Germany, Hong Kong, the Netherlands, South Africa and the U.S. earn between 71 times and 183 times as much as the average employee in those nations. Some studies show that in the U.S., the average inflation-adjusted wage of workers has actually fallen over the past 30 years. "Nobody ever claimed the market economy would produce social justice," says Joseph Stiglitz, the Nobel Prize – winning American economist, who says that today's problems "are much deeper than the failure of financial markets."

Stiglitz was one of an all-star cast invited to Paris in January to take part in a two-day seminar titled "New World, New Capitalism." The gabfest was organized by a man who personifies today's intellectual flux: Eric Besson, a rising star in the French Socialist Party who switched over to Sarkozy's conservative camp before the 2007 presidential election and has gone on to a stellar career in government. "One of the rare positive effects of the crisis is the way that it has opened up people's minds, creating an intellectual window of opportunity," Besson says.

Karl Marx, to be sure, would not have thought much of the seminar. Its thrust was how to reform the existing system rather than overthrow it, and a significant part of the debate focused on how better to regulate finance and jump-start global cooperation on economic issues. But the theme of social inequality that was central to Marx's thinking also got an airing. Was it just up to governments to be smarter about redistributing prosperity among the population? Or, wondered Pascal Lamy, who runs the World Trade Organization, "is there a new paradigm, because globalized capitalism creates bigger inequalities, and the international division of labor is much stronger than in the past?" His answer: Yes, there has indeed been a shift that requires an international solution to capitalism's challenges.

One problem: when the intellectual pendulum swings, it sometimes goes too far. At the Paris seminar, Ellen Johnson-Sirleaf, the President of Liberia, sketched out how Africa swung from state control of the economy in the 1960s and 1970s to an embrace of deregulation and other neoliberal policies starting in the 1980s. "History has not been kind to the strong version of state control," she said, "but the enthusiasm for deregulation went too far." In some places, privatization of water and electricity simply replaced public monopolies with private ones. "History has shown that neither of the extreme versions is right," Johnson-Sirleaf added. "We need a proper balance that evolves over time."

The Head in Highgate Cemetery

Marx moved to London in 1849 and spent the last 34 years of his life there, much of it in the Reading Room of the British Museum, where he studied official reports of the miseries of British industrial workers and wrote most of his best-known works, including the first volume of Das Kapital. Engels was an important influence: he had studied factory life in Manchester for his critical work The Condition of the Working Class in England. The two men considered England's form of capitalism to be especially advanced, and erroneously expected it to be the first country to undergo a socialist revolution. (See pictures of 250 years of the British Museum.)

The Reading Room's books were transferred in 1997 to the new British Library near St. Pancras station. The move coincided with a critical intellectual transformation in Britain: the rise to power of Tony Blair's New Labour and the end of the last vestiges of Marxism as a political force in Britain. Germany's Social Democrats made their decisive break with Marxism in 1959, but antimarket currents lingered on in the British Labour Party until Blair and Gordon Brown, the current Prime Minister, banished them by embracing London's financial district, encouraging business and financial innovation, and granting political independence to the Bank of England. With the banking system in need of help, some antimarket feeling is resurfacing, and a number of Labour MPs have been arguing the need for a broad nationalization of banking and industry.

Brown's political opponents on the right are also on the attack, but much of the criticism is coming from another source: church leaders, including the Archbishop of Canterbury, Rowan Williams, who harbors an unlikely sympathy for a man whose followers adopted atheism as a state creed. "Marx long ago observed the way in which unbridled capitalism became a kind of mythology, ascribing reality, power and agency to things that had no life in themselves; he was right about that, if about little else," Williams wrote in an article published the week after the collapse of Lehman Brothers.

Marx's grave in London's Highgate Cemetery is marked by a bronze bust of the man on a gray granite plinth, commissioned by the British Communist Party and unveiled in 1956. Inscribed in gold is a quotation: "The philosophers have only interpreted the world in various ways. The point however is to change it." At nearby St. Michael's Church, vicar Jonathan Trigg says many members of his congregation work in financial or financial-related jobs, and "are very anxious" about the future. What do they think about the need to change the world? "Any intelligent person should ask questions about values," Trigg says. "Boom times can lead to collective delusion, and everyone gets caught up in it." Karl Marx couldn't have put it better himself.

Via:

www.time.com

What Woud Marx Think?

Beijing leads nation in longevity with 80-year average lifespan

A rise in living standards over the past 60 years has added about three decades to lifespans in Beijing, the capital's office for senior citizens said Friday.

The average life expectancy of Beijing residents reached 80.24 years as of 2008, top in the country, the office said. That lifespan compares with 52.8 years for Beijingers when the New China was founded in 1949.

Beijing has 396 people aged above 100 years, it said, compared with 311 in 2006, 247 in 2003 and 190 in 2001.

The office said its survey of centenarians found most of them lived a healthy lifestyle, which included good personal hygiene, eating sparingly and drinking in moderation. Most were also "optimistic and cheerful," it said.

Beijing's population neared 17 million at the end of last year.

Liu Keqin, now 109, is the oldest person in Beijing, according to the Beijing Daily. Although he's hard of hearing, Liu can still take care of himself, said Wang Jingxia, his granddaughter-in-law.

Source:

http://english.sina.com

Beijing leads nation in longevity with 80-year average lifespan

U.S. to invite wealthy to invest in bailout: report

The U.S. government plans to invite wealthy investors to invest in the bailout of the crippled financial system, The Washington Post reported on Friday.

The investors would be invited to buy up recently issued, highly rated securities that finance consumer lending -- without the risk of massive losses, the report said.

The idea is to entice the investors to put their huge cash piles to work to stimulate the financial system, the Post said.

The program, which could involve the government lending nearly $1 trillion to these investors, exceeds the size of every other federal effort to address the financial crisis so far, the newspaper said.

The initiative adopts an approach that could be the model for future federal efforts to aid the credit markets, sources familiar with government planning were quoted as saying.

Source:

www.reuters.com

U.S. to invite wealthy to invest in bailout: report

The power of green technology

From the 'zero watt PC' to a smart electricity meter that allows consumers to monitor their power consumption in real-time, Green IT is getting much attention at CeBIT.

The number of vendors at Europe's largest technology trade fair has dwindled due to the global economic crisis but the environmental element of this show has branched out - growing six-fold over last year.

Source:

www.reuters.com

The power of green technology

China sees signs economy might be recovering

By: JOE McDONALD

China sees signs economic growth is recovering but is watching closely to determine whether it needs to expand its huge stimulus effort as global conditions worsen, top economic officials said Friday.

"We have seen some positive signs including recovery of export growth," Zhang Ping, the chairman of the country's planning body, the National Development and Reform Commission, said at a news conference. "It really depends on the changing situation to determine whether we need additional investment."

Zhang and central bank Gov. Zhou Xiaochuan said positive data showed Beijing's policies were working. Zhou repeated Premier Wen Jiabao's statement Thursday at the opening of the legislature that China can achieve 8 percent growth this year as Beijing steps up spending to create jobs and boost exports.

World markets fell Thursday after Wen failed to mention any expansion of the 4 trillion yuan ($586 billion) stimulus plan. Along with worries about the financial health of big U.S. banks and General Motors Corp., that sent the Dow Jones Industrial Average down more than 4 percent. Tokyo stocks were down 3.5 percent in Friday afternoon trade.

Analysts are divided on how quickly China can rebound from the slump that saw growth fall to 6.8 percent in the final quarter of last year from 13 percent in 2007.

Some point to rising bank lending and other indicators and say the decline is already bottoming out. Others expect growth this year to fall as low as 5.6 percent — the weakest in nearly two decades — and argue China cannot recover until its Western export markets revive.

Two surveys released this week showed China's manufacturing contracted in February for a fifth month but at a slower rate. Exports fell 17.5 percent in January from a year earlier.

Zhang said China expects to emerge from the crisis more competitive than before.

He said 580 billion yuan ($85 billion) of the stimulus will be spent helping companies improve technology and energy efficiency.

"We are not looking only at immediate difficulties and challenges but also considering how to provide a solid basis for future development," he said. "Having stood the test of this crisis, the quality and competitiveness of the Chinese economy will reach a new high."

Zhang's comments were the most detailed explanation yet of how Beijing plans to spend its stimulus. The package was announced in November but companies and investors have received little information, prompting complaints by China's public and warnings that secrecy would increase the potential for corruption and waste.

The government will spend 370 billion yuan ($54 billion) on roads, power supplies and other rural infrastructure; 1.5 trillion yuan ($219 billion) on highways and railways and 150 billion yuan ($22 billion) on education, health and cultural facilities such as museums, according to Zhang. Some 1 trillion yuan ($145 billion) will go into reconstruction efforts for last year's devastating earthquake.

The stimulus is meant to reduce reliance on exports by boosting domestic consumption.

Zhang said Beijing has assigned 24 teams of auditors to make sure no money is misused or wasted in a system where thousands of officials are punished every year for embezzlement, extortion and other abuses.

"We have not discovered that any money has been misused," Zhang said.

Via:

www.ap.org

China sees signs economy might be recovering