Random Thoughts

Consumers strained by rising prices - Yahoo! News
Consumers strained by rising prices

By Glenn Somerville

WASHINGTON (Reuters) - Shoppers faced moderate price rises in December but that capped a year in which prices soared at the sharpest rate in 17 years, pressuring households also dealing with a steep housing downturn and tighter credit.

The Labor Department said on Wednesday its Consumer Price Index rose 0.3 percent in December, less than half November’s 0.8 percent jump. For all of 2007, the CPI rose 4.1 percent, well ahead of 2006’s 2.5 percent gain and the steepest since 1990.

The data “underlines our view that we’re on the razor’s edge here, that we could be headed into recession,” said Mike Schenk, senior economist with Credit Union National Association in Madison, Wisconsin.

Separately, the Federal Reserve said that output by the nation’s mines, factories and utilities was flat in December and for the full year 2007 posted its weakest gain since 2003.

Fed policy-makers are widely expected to cut interest rates aggressively by a half percentage point when they meet January 29-30 and the White House, Congress and politicians campaigning for presidential nominations all are urging swift action on a complementary fiscal stimulus plan.

Stock prices were mixed at mid-day. The Dow Jones Industrial Average (.DJI) was slightly ahead, helped by news that banker JP Morgan Chase & Co. (JPM.N) managed to make a profit in the fourth quarter in contrast to some other big banks.

But the Nasdaq composite index was lower with technology shares hurting after a disappointing earnings report from sector bellwether Intel Corp (INTC.O). Intel’s chief financial officer, Stacy Smith, said he was a “little bit cautious” about the economy’s prospects, a comment that fed investor fears about a potential downturn

U.S. Treasury debt prices were mixed as traders apparently took some profits from a recent run-up in prices.

The Consumer Price Index is the most widely watched gauge of inflation. The so-called core CPI, which strips out volatile food and energy items, was up 0.2 percent in December after a 0.3 percent November increase, which some analysts said was a reassuring sign that price pressures might be easing.

“Over the last 12 months, core inflation increased 2.4 percent, still a little too hot for the Fed but below the 2.6 percent year-over-year level we saw in November,” said Bernard Baumohl, managing director of The Economic Outlook Group LLC in Princeton, N.J.

“Given this relatively calm inflation environment, the Fed need not be reluctant to significantly lower short-term interest rates,” he added.

The department said both food and energy costs rose during 2007 at the fastest rates since 1990. Energy costs in the 12 months were up 17.4 percent while food gained 4.9 percent.

In a separate report, the Fed said U.S. industrial production was flat in December, defying expectations for a decline. Manufacturing output was also flat last month following a revised 0.3 percent rise in November.

Despite signs of a slowing economy, foreign investors continued to pour money into U.S. investments. Net overall capital inflows into the United States surged to $149.9 billion in November, from a revised $92.2 billion in October, the Treasury Department said.

November’s inflows were more than sufficient to cover the month’s U.S. trade deficit of $63.1 billion.

Net long-term capital inflows totaled $90.9 billion compared with $114.0 billion in October.

(Additional reporting by Gertrude Chavez-Dreyfuss and Ellen Freilich in New York and Alister Bull in Washington; Editing by Andrea Ricci)

Oh no, don’t tell the music industry this! For a long time there was an argument that perfect digital copies are the problem, and that they really didn’t mind the not so perfect copies that tapes or low quality streaming or bad rips. But evidence that people want portability before quality, no, don’t tell them that.

Well, I still maintain that the industry needs to make top quality audio, and associated packaging an elite thing. Make it a status symbol. Those people that have the top notch quality audio in the car and have the nice cases to show off should be considered cool, or well off. Make the CD inserts cool to have, with lot of info and pictures, this will make more people want to show off and be cool.

Anyways, the article that sparked this mini-rant, from Boing Boing€ (good discussion there btw):

Music producers mixing for MP3
Posted by Cory Doctorow, December 29, 2007 3:23 AM | permalink
In a fascinating article about trends in sound engineering, Rolling Stone notes that producers are now specifically mixing tracks to compensate for the failings in MP3 — it seems to me that as a society, we’re happy to sacrifice fidelity for ease of use, flexibility and low-cost (see, for example, the trend from landlines to cordless phones to mobile phones to Skype). Designing for that, as opposed to lamenting it — is a damned good and realistic thing to do.

Producers also now alter the way they mix albums to compensate for the limitations of MP3 sound. “You have to be aware of how people will hear music, and pretty much everyone is listening to MP3,” says producer Butch Vig, a member of Garbage and the producer of Nirvana’s Never- mind. “Some of the effects get lost. So you sometimes have to over-exaggerate things.” Other producers believe that intensely compressed CDs make for better MP3s, since the loudness of the music will compensate for the flatness of the digital format.

Link to full story at Rolling Stone (via /.)

Interesting article talking about some of the business in hacking nad virus writing groups. No surprise that they will make license agreements similar to what microsoft and other unreasonable agreements that are floating around. Malware writers taking lessons from corporate legal, who is surprised by that?

from yahoo news / AP

 Online crooks getting more professional

By JORDAN ROBERTSON, AP Technology Writer Mon Sep 17, 1:09 AM ET

SAN JOSE, Calif. - Online crooks are quickly enlarging an already vast sales and distribution network to propagate spam and send malicious software in hopes of infecting millions of computers worldwide, according to a new report.

In a report to be released Monday, security software maker Symantec Corp. says sophisticated thieves sell code to criminal middlemen for as much as $1,000 per program. The middlemen then push the code to consumers, who may be duped into participating in a scam, or who may have their passwords, financial data and other personal data stolen and used by identity theft rings.

The savviest hackers lock middlemen into long-term service contracts so they can automatically push the newest exploits on unwitting consumers and compensate for patches developed by legitimate programmers.

The agreements — not unlike contracts between software powerhouses such as Oracle Corp. or Microsoft Corp. and their corporate clients — leave a trail of code that, in principal, makes it easier for authorities to catch both the hacker and the person who’s buying the program. But researchers who worked on Symantec’s newest Internet Security Threat Report said the amount of money to be made from computer attacks still outweighs the danger.

“These people are taking a huge risk, and either they’re stupid — which we don’t believe is the case — or they’re making big money,” said Alfred Huger, vice president of Symantec Security Response.

Symantec’s new report covers the first six months of 2007 and draws on attack data gathered from more than 120 million computers running Symantec antivirus software and more than 2 million decoy e-mail accounts designed to attract spam and other shady messages from around the world.

Among the findings:

• The sale of stolen personal information online continues to grow. The United States is the top country for so-called underground economy servers, home to 64 percent of the computers known to Symantec to be places where thieves barter over the sale over verified credit card numbers, government-issued identification numbers and other data. Germany was second and Sweden ranked third.

• China had the most computers infected by Web robots, or bots — software that performs automated tasks online, such as propagating spam, often without the knowledge or consent of the computer’s owner. China had one-third the world’s computers conscripted by “bot herders.”

• The number of threats caused by malicious code has ballooned. In the first six months of the year, 212,101 new malicious code threats were reported to Symantec, an increase of 185 percent over the previous six months.

But researchers agreed that professional-grade service agreements between cyber criminals and their agents was the most alarming trend.

A small number of malicious “toolkits” — bundles of exploits that allow criminals to customize their own scams and attacks — is responsible for a growing number of attacks.

Only three toolkits were responsible for 42 percent of the 2.3 million so-called ‘phishing’ messages spotted and blocked by Symantec during the first six months of the year. Crooks use phishing messages to try and steal personal and financial information by tricking people into entering private information into bogus Web sites that look like the sites of legitimate brands such as banks or popular retailers.

Such toolkits cost $300 to $800.

Another widely available toolkit in early 2007 — called MPack — sold online for $1,000 and allowed users to launch attacks in Web browsers against people who surf on malicious or compromised sites. In some cases it appeared to come with a support pack from its authors, Symantec said.

“The reliability and robustness of MPack implies that it benefited from professional development,” researchers wrote.

Other researchers discovered more hopeful signs.

According to a report expected Monday from IBM Corp.’s Internet Security Systems X-Force researchers, the number of computer vulnerabilities either publicly disclosed by companies or discovered by threat researchers declined during the first half of the year.

IBM tallied 3,273 vulnerabilities — down 3.3 percent from the first half of last year. IBM said it was the first time the vulnerability numbers fell during the first half of the year since X-Force began cataloging them in 1997, when there were 106 known vulnerabilities.

Reasonable agreement should be more well known.

So why isn’t everyone talking about how the economy is screwed up, middle class and poor people are suffering so bad, yet there is very little news talking about it. You see some articles like this and people probably just say, oh there are bad people out there, and this is just another example. Well In my humble opinion this is just a symptom of the sickness that is prevalent in this country.  Corporate America is doing well making money and the expense of the people. The people are suffering, and there is very little data released about it. You can be sure that places are not reporting all the thefts and many places do not even know how bad it really is.

corporations try to minimize this info to keep stock holders happy and their stock price up, just like police agencies are reporting crimes as lesser charges in order to make their cities and respective departments look better.

Article found via the Tennessean newspaper

Wal-Mart has tough time as thefts increase
Store’s losses closer to industry average

By ANNE D’INNOCENZIO and MARCUS KABEL
Associated Press

NEW YORK — Shoppers at Wal-Mart stores across America are loading carts with merchandise — maybe a flat-screen TV, a few DVDs and a six pack of beer — and strolling out without paying. Employees also are helping themselves to goods they haven’t paid for.

The world’s largest retailer is saying little about these kinds of thefts, but its recent public disclosures that it is experiencing an increase in so-called shrinkage at its U.S. stores suggests that inventory losses because of shoplifting, employee theft, paperwork errors and supplier fraud could be worsening.

The hit is likely to rise to more than $3 billion this year for Wal-Mart Stores Inc., which generated sales of $348.6 billion last year, according to retail consultant Burt Flickinger III.

Flickinger and other analysts say the increase in theft may be tied to Wal-Mart’s highly publicized decision last year to no longer prosecute minor cases of shoplifting in order to focus on organized shoplifting rings. Former employees also say staffing levels, including security personnel, have been reduced, making it easier for theft to occur.

Wal-Mart declined to offer any explanations for the rise in losses but denied it has cut security staff and said employee morale is rising rather than falling.

Theft common in retail

Although Wal-Mart declined to reveal any details, analysts suspect Wal-Mart — which for years had a theft loss rate that was half that of its peers — is getting closer to the industrywide average. Theft is a big problem for all retailers, costing them $41.6 billion last year, according to a joint study released Tuesday by the National Retail Federation and the University of Florida.

Whatever the cause, such theft — which late founder Sam Walton once called one of retailers’ top profit killers — adds one more challenge when Wal-Mart is already struggling with sluggish sales at its established stores because of an overall economic slowdown as well as its own stumbles in its home and apparel merchandising strategies.

Eduardo Castro-Wright, president and CEO of Wal-Mart’s U.S. store division, acknowledged the theft problem in a mid-May conference call with analysts. He cited shrinkage as well as increased markdowns and higher inventory for dragging down first-quarter profit margins.

“We are concerned about shrinkage and are investigating the cause and are taking steps to correct it,” Castro-Wright said. Company officials won’t comment on those countermeasures.

The company also said in a June 1 filing with federal securities regulators that the gross profit margin for its Wal-Mart Stores segment fell by 0.1 percentage points in the first quarter caused in part to “higher inventory shrinkage.”

Revelation is significant

Analysts say it’s significant that the company has publicly disclosed that theft is becoming a problem.

“It is getting to the point of being material,” said Richard Hastings, vice president and senior retail sector analyst at Bernard Sands. Securities regulations require companies to alert shareholders to significant corporate developments that could affect the value of their holdings.

About 47 percent of the dollars lost came from employee theft, while shoplifting accounted for about 32 percent, according to the National Retail Federation report. Administrative errors account for 14 percent, while supplier fraud accounts for 4 percent. The remaining 3 percent is unaccounted.

The company’s vociferous critic WakeUpWalMart.com, funded by the United Food and Commercial Workers, which has been for years trying to organize the retailer’s workers, publicized the company’s decision last year to relax its zero-tolerance policy on shoplifting. The new policy seeks prosecutions of first-time offenders only if they are between ages 18 to 65 and steal at least $25 worth of merchandise.

That change may have emboldened some folks to shoplift, said Mark Doyle, president of Jack L. Hayes International, a retail consultancy on loss prevention.

The change in policy came at the same time the company began using more part-time workers — in part because of a new scheduling system that matches staffing more closely to peak shopping hours — and shifting security personnel, analysts and critics say.

While Wal-Mart denies that it has cut anti-theft jobs overall, it said it has adjusted staffing to put more personnel in stores in high-crime areas and fewer in stores with less trouble.

Not quite sure how I think about what these people are spinning… Certainly there are many more aspects to consider. One one hand I think technology should go further at the retail level. I have been in conversations about ideas for improved technology and ease of shopping with more technology at the retail level. At the same time, considering the loss of retail jobs, there are many people out there that are good at retail, yet there seems to be less opportunity for these people to work. This is a real shame, because a big part of the retail experience is the people, the manners, not just pretty displays.

There are many other industries that are having similar issues, from real estate to radio and many in between. More on this later.

Article that started this random thought:

(from the Tennessean Newspaper)

Technology eases – or erases – jobs

By JEANNINE AVERSA
Associated Press

Retailers rely on electronic helpers in hopes of higher sales

WASHINGTON — Red pumps. Silver slingbacks. Bronze flats. Black suede boots. Size 7½, please.

Without leaving the customer’s side, Macy’s sales associate Felicia Dixon uses a small, hand-held electronic device that essentially summons the shoes in the right style, color and size from the stockroom.

That’s one example of the kind of technology retail stores today spend $34.5 billion a year on.

Some workers might view technology, such as self-checkouts, as threatening their job. Other devices — electronic price checkers or Macy’s shoe locator — might make their jobs easier.

But the number of jobs in some segments of the retail industry is diminishing, and economists believe that technology has played a prominent role.

An Associated Press analysis of Bureau of Labor Statistics’ employment data found that department stores have slashed 247,100 jobs since June 2001, when employment in that sector peaked.

Stores buy all kinds of technology, from the cables and routers behind the scene to in-store devices such as price checkers, self-service checkout stations and electronic kiosks for customers, says the National Retail Federation.

With older equipment needing to be replaced, spending for high-tech upgrades is expected to increase, the federation says.

Technology that allows companies to produce more goods or provide service to their customers with fewer workers or with their current staff is a factor in some job losses, economists say. A second is consolidation, when a company buys out or merges with a competitor.

“No local union has ever reported laying off people because of self-scanners. We installed these machines and now the direct result is X number of jobs have changed,” said Jill Cashen, spokeswoman for the United Food and Commercial Workers International Union, whose members include workers at grocery stores, department stores and other retailers.

Productivity — the amount a worker produces for every hour on the job — has grown at a faster rate in the retail industry than in all industries across the economy.

If this had not occurred, there now would be nearly 4.5 million more jobs in retailing, according to Mark Zandi, chief economist at Moody’s Economy.com. “Arguably it has been hard on workers,” Zandi said.

Goal is customer service

Yet companies say a reduced work force is not the main goal of technological innovations.

The device Dixon, the Macy’s sales associate uses, sends the shoe request to a clerk in the back room, who brings out the merchandise. The shopper does not have to hunt around for a clerk each time she wants to try on a different style or needs a different size. Better service means happier customers, and that could lead to more sales.

At least that is the hope, from the retailer’s perspective.

At the Macy’s in Arlington, Va., store manager Paul Gassner says extra workers were hired when the shoe-locator technology was brought to the women’s shoe department two years ago. He said it had “significantly improved sales” and proved to be a big time saver.

It lets sales associates such as Dixon get shoes on customers’ feet more quickly by saving employees the time of having to keep running back to the stockroom.

It took Dixon a week or two to master the device. Now it’s easy, she says.

More familiar to customers is the self-checkout.

The retail industry spent $380 million on installing new self-service checkout units in 2006, and that is expected to rise to $457 million this year, says Greg Buzek, president of IHL Consulting Group, a research and consulting company that specializes in technology for the retail and hospitality industries.

The investment in self-checkouts may not necessarily yield a big payoff for the retailer.

The average self-service checkout machine costs $21,000 and has a typical life of five years, Buzek estimated.

In contrast, a regular cash register costs on average $4,000 and has a longer life — typically nine years, Buzek says. Often, the self-service checkout machines are clustered in a group of four at stores, with one store clerk designated to oversee the self-checkout squad, he said.

The average wage of a grocery store cashier is $19,060 a year, according to the Labor Department.

In addition to cost, there are concerns about theft. Some stores have a clerk to watch and to help customers at self-checkouts.

Devices give sellers data

Stores also are increasingly interested in ways to use technology to provide more information about products or other things while shoppers are in the store.

One example is the interactive kiosk. Through a live video link, a customer can ask an expert about equipment needed to install a home theater system or how to connect computers at home via wireless routers or what kind of hiking equipment or kayak to buy.

David Hogan, the National Retail Federation’s technology guru, says that in the future, shoppers might pay for their purchases by touching a finger to a screen or electronic
pad, which would match a digitally stored imprint of the finger.

Larry Lewark, Macy’s point person on technology, predicts that in five years customers routinely will pay for merchandise with a few clicks on their cell phone or other personal digital devices.