Economy: A Welcome To The Robots

I believe that this century will be the century of the robots, maybe even this decade. The other day I spotted one of them, a cute household device called "Roomba" (wikipedia).

It was fun to watch how this autonomous vacuum cleaner navigated through a small shop room without any visible human interference. The cute machine moved swiftly while avoiding contacts with walls and the many objects in the room. The little robot averted being trapped in the corners, didn´t bother the huge toy bear sitting in a corner and didn`t fall out onto the street even when the door was wide open.

Roomba is a typical cybernetic machine. The word cybernetic comes  from the ancient Greek term kybernētēs, meaning "steersman, governor, pilot" (wikipedia). Your air conditioner, for instance, is a typical simple cybernetic system. You might choose a certain temperature, say 68 F (20 Celsius). Then the sensors of the climate system will constantly check the room temperature, compare the target with the actual situation and respond to deflections. If the temperature climbs higher than 68 F the systems responds and starts cooling, if the temperature falls below 68 F, it stops cooling and might even start heating.

The Roomba and other robots work in a similar way. The processors respond to signals from the sensors about objects which have to be avoided.

Today most of the robots are working for industry. They are saving costs, for instance by assembling car parts or lacquering them. Even farmers are using more and more robots, for instance for harvesting strawberries or milking cows (wikipedia). These machines are reducing the costs of producing something significantly, making things cheaper and more affordable. Hence robots are raising the living standard of everybody. The saved costs also translate into rising company profits even in a sluggish economy and in this way are fueling  the rise of the stock market - generating wealth for millions. 

I reckon that we will see many more robots soon as a result of the technological progress. The necessary processors, sensors and memories are getting smaller and cheaper all the time (thanks to Moore`s law) which causes more affordable and better robots. Robots also could be the answer to the problem that a falling birth rate leads to a shrinking percentage of working people (work force) and a rising number of retired people. More and more things will be produced by robots substituting the missing workers and raising the life standard of the world.

Culture: Poetry Reading By Riverside Poets At NYPL Riverside Branch, Manhattan, New York City

  

(Drivebycuriosity) - Relationships alter your horizons. For almost 3 years I have been seeing a beautiful New York woman whom I married this New Year´s Eve. She opened my eyes to the world of poetry.

This Saturday I attended a poetry reading by the Riverside Poets at the NYPL Riverside Branch in Manhattan, New York City, which she is administering. It took place in a small library on Amsterdam Avenue. There gathered a group of New York poets. 

Among others reading were my wife Sarah Ellen Bedell, who is administering the Riverside Poets group, DeeAnne Gorman, who also is a beloved vocalist and performer (facebook), Peggy Murphy and David Elsasser, who has poetry group of his own.

A enjoyed the variety of poems  - around 40 writings including some short haikus - the attendees read there. Every reader presented his or her own universe, hence the afternoon was full of surprises. Many of the poems were philosophical and full of interesting ideas. Some texts were funny, others sad.

Here is one example, courtesy of Sarah, my beautiful wife. Enjoy.

You sit there in my home,
wondering if I have poem –
But I’m at the office,
shouldn’t that suffice?
I’ve got notes on some old beaus,
who left me mostly in throes
 - of rejection,
I could write of those -
You silly slave driver of affection!
BTW - What would you do?
If the same happened to you?
But there is no problem G.
I am smitten as smitten can be.

Stock Market: Why The Fireworks Will Continue

Last week the global stock markets delivered fireworks. The S&P 500, the benchmark for US stocks, climbed to the highest level since 2007 (marketwatch). The index gained 4.6% for the week, its largest one-week percentage gain since the week ending Dec. 2, 2011.

The rally got ignited by the fiscal cliff deal on New Year´s Eve (the perfect gift for my wedding on this day) and received a lot of tailwinds from beneficial macroeconomic news from China & US.

Yesterday we learned that the US generated 155 K new jobs in December. This number is perfect for the stocks because the job growth is strong enough to generate more income to finance the growing consumer spending. But the number isn´t strong enough to induce a rise of the interest rates which are now close to zero. Hence the monetary policy should continue fueling the rally on the stock markets.

I am also encouraged by the ISM Non-manufacturing index which showed that the US service sector (the largest part of the economy) accelerated its growth in December (calculatedriskblog). The solid numbers prove that the US is still on a sound growth path and  is doing much better than the majority believes.

I reckon that the fireworks will continue this year. I believe that  the economic growth in the US & China will continue and maybe even accelerate. This should reanimate the ailing economy in Europe.

Next week the focus should change to the company numbers because of the starting earnings season. On Tuesday Alcoa is expected to be the first large company which reports profits & revenue from Q4 2012. I reckon that most of the S&P 500 companies will beat the the predictions of the analysts because the majority oft them is too pessimistic. I further believe that the average of the companies will provide a solid profit growth thanks to the rapid technological progress which strengthens their efficiency and reduces the costs.

Rising company profits and a healing global economy accompanied by record low interest rates are a strong fundament for further gains on the stock market. Enjoy!

Movies: Argo

 

 (Drivebycuriosity) - Revolutions belong to the worst things on earth. The Iranian revolution is no exception. 1979, after the Shah Mohammad Rezā Shāh Pahlavī, who is still hated by the left wing in Europe & US, has been overthrown, the mob started to rule in the streets of Tehran. Shortly after the Shah has fled to the US, the American embassy was stormed by agitated masses who acted like zombies. 6 US citizens could escape and found refuge in the Canadian Embassy. Their hidden asylum got more and more endangered by Iranian fanatics who where feverishly searching for them. Under huge time pressure the CIA - in cooperation with Canadian authorities - accomplished a clandestine operation to save these people and smuggle them out of the country. As camouflage they faked a movie production claiming that the 6 refuges are member of a Canadian film team which had to inspect Iranian locations for an alleged Science Fiction film called "Argo".

The movie "Argo" tells this historical true story in a way Alfred Hitchcock would have been proud of (imdb). Director Ben Affleck and screenwriter Chris Terrio deliver a nail biting thriller which lets the audience participate in the growing dangers and the extremely narrow escape.

But the film offers much more. It is partly a documentary and shows how one man, the CIA agent Tony Mendez, played by Ben Affleck himself, organizes a sophisticated and imaginative rescue operation on an extremely hostile terrain. "Argo" also shows how people respond in a claustrophobic and dangerous situation and how they have to develop trust and faith into their rescue. Furthermore, the film is a lecture how bigotry and fanaticism leads to blind hate against innocent people which transforms humans into fierce beasts.

Affleck`s fine ensemble converses the story in a convincing way. "Argo" shows what cinema could be.

Movies: Django Unchained

 

 (Drivebycuriosity) - Quentin Tarantino is a brand name. He stands for sharp violent movies which are a lot of fun. But the world is changing and adapting and now many directors deliver flicks in the manner of Tarantino. Some of these films - like "The Paperboy (director: Lee Daniels)", "Killer Joe (director: William Friedkin)" and "Lawless (director: John Hillcoats) - are even sharper than the original. But the master still produces bloody but highly entertaining popcorn movies.

"Django Unchained" (imdb.com), Tarantino`s newest epic, refers to the 1966 spaghetti Western movie "Django", directed by Sergio Corbucci. Tarantino transferred the idea of a super fast gunman to the US shortly before the civil war. "Django" is another example of the revenge movies, Tarantino seems to love so much. Now a bunch of highly sadistic slave traders get messed up by a German bounty hunter and his African-American companion, a freed slave.

The film shows, typical for Tarantino, a bloody mess. But, even though "Django" is a 2 hours 45 minutes long orgy of violence and mayhem, the film is sophisticated and at least partly elegant. It seems that Tarantino has invested more time into the development of the dialogues than in his former works. Hence the filed conversations grant the film a lot of his pleasure.

Christoph Waltz almost owns the movie. The Austrian actor, whom I had loved for his role in Polanski´s "Carnage", delivers another brilliant feat as a German bounty hunter named Dr. King Schultz. I adore the sophisticated and elegant manners he uses to stultify his opponents.

Leonardo DiCaprio, as a violence freak and perverted slave owner, is the perfect adversary to Waltz`s character. The American actor plays a villain of whom each James Bond movie could be proud about. Contrary to the usual redneck & brain dead slave holders his sophisticated style matches Dr. Schultz`s brilliance in a very entertaining way.

Jamie Foxx is a cool and deadly "Django", almost like the original, the Italian actor Franco Nero. The beauty of Kerry Washington, as Django`s enslaved wife, lends the film more charm.

But all these fine actors are standing in the shadow of Samuel L. Jackson as house slave Stephen. This factotum is obnoxiously obedient to his master, the slave holder, but vicious to his fellow slaves. His creepy and somewhat demoniacal style reminds me a bit of the character "Gollum" in "The Lord of the Ring".

A Tarantino movie wouldn`t be a Tarantino movie without a superb soundtrack, this time with a lot in the style of Ennio Morricone, the score master of the spaghetti Westerns.

"Django Unchained" is a fairy tale for grown ups who don`t mind when the screen gets sometimes a bit bloody.

Culture: A Wedding At City Hall, New York

 

 (Drivebycuriosity) -  On New Year´s Eve (Sylvester) I got married. I bonded with a beautiful New York woman I have been seeing for almost 3 years. The official wedding ceremony took place in New York`s City Hall which is in Manhattan´s Financial District.

The place seemed to me like a combination of a railway station and a cattle auction - very American I guess. It was crowded, loud and a bit chaotic.

My bride and I arrived there around 10 am and went to a desk close to the entrance where we got the number 722. We were told that we would have to wait in line until this number is called.

The waiting hall, which is shaped like a long hose, has 2 boards where the numbers and the stations for registering are displayed. There also are loudspeakers which announce numbers and desks. 

There were a lot of people waiting on their calls, which created a chaotic cluster.  Crowds, boards and loud speaker announcements created a busy and somewhat industrial atmosphere. I wouldn´t have been very surprised if the arrival of a train would have been announced or some farmers would have called weights and prices of their cattle.

Some people there were much less formally dressed than they are usually at German weddings. Many had just casual outfits and some wore redneck t-shirts. Interesting was a high percentage of same sex couples. I guess this reflects the shrinking popularity of traditional marriage and the rise of gay and lesbian pairings, at least in
America.

Around 12pm our number was called and we could register at the desk with our witness . Then we had to wait around 40 minutes more for the final act.

 

Around 1pm the wedding ceremony took place in a room called a chapel. The city authority person delivered a short but nice speech and declared us finally husband & wife by the law of the great city of New York.

Stock Market: 2013 - Year Of The Bull?

One year ago I wrote a post called "2012 - Year Of The Bull?" (drivebycuriosity). There I explained why I expected a powerful rally, driving the S&P 500 north of 1.700 points, which would have been a jump of at least 30%. Instead we got just gain of 13% and the index closed at 1.426 points. A global gauge, the MSCI All-Country World Index of equities, advanced 17% (bloomberg). This is a solid outcome - better than the performance of alternative investments like bonds and commodities - but by far less bullish than I had expected.

Where was I right and what went wrong?

- As expected companies worldwide expanded their profits thanks to the rapid technological progress which led to more efficiency and lower costs.
- The US consumers also didn´t disappoint me. They stayed in spending mode and worked as the global growth engine as I hoped for.
- China avoided the crash many pundits had predicted. Though the expected re-acceleration of China´s economic growth began not until the 4 quarter, later than thought.
- And the recession in Europa was more deep and painful than feared.
- I also didn´t calculate with the hysteria about the US fiscal cliff which spoiled the global stock markets in the recent weeks.

But the worries from last year could be the chances of this year:

I reckon that the gains on the stock market will continue this year, maybe a bit stronger than 2012.  The fiscal cliff solution - which now seems to appear - should lead to a strong start. The main engine of the global growth - and therefore the stock markets - will be the continuing rise of company profits. I reckon that the technological progress will accelerate in 2013 as it does every year (Moore´s law).
The US consumer spending will stay the engine of the global economy fueled by the continuing healing of the job market. China will gather speed and Europa will finally end the recession driven by climbing exports to the US, China and other emerging markets.

Many are still under-invested, including the majority of the big funds. A lot of money idles now in bonds and money market funds, with almost zero interest. A rising stock market could set many fund managers under performance pressure. They would have to buy stocks otherwise they would miss the upswing.

Hence I expect that the S&P 500 will close north of 1.700 by the end of the year and we should get a rally of at least 20%.

Happy New Year and much luck to all of you!