Tuesday, April 29, 2014

UK grows 0.8% in Q1; Slow growth is a worry at Twitter; Workplaces with 'toxic' environments

1 UK grows 0.8% in Q1 of 2014 (Katie Allen in The Guardian) Britain's economy picked up pace in the first quarter of this year but not quite as fast as economists had been expecting. The Office for National Statistics said on Tuesday that GDP expanded by 0.8% in the first quarter after 0.7% growth in the final three months of last year. That was below economists' forecast of 0.9%.

The year-on-year growth rate was 3.1%, the fastest in six years, but again below forecasts for 3.2% growth. The economy is still smaller than it was before the recession hit in 2008 but analysts said it was now on track to make up all the lost ground by the middle of this year.

Although there were signs the recovery was broadening, with even the battered construction sector returning to growth in the first quarter, the ONS said the UK economy still remains 0.6% below its pre-crisis peak. Without the drag from a shrinking oil and gas sector the economy was 0.3% bigger than that pre-crisis peak, statisticians added. George Osborne seized on the figures as confirmation that the recovery was well under way.


2 Growth is a worry at Twitter (Nicole Perlroth in The New York Times) Twitter is struggling to convince Wall Street that it is still a company with plenty of potential to grow. In its second earnings announcement as a public company, Twitter said it had more than doubled revenues, beating its own forecasts and the expectations of investment analysts. But the social network’s stock fell more than 11 percent in after-hours trading because the number of people who joined it did not increase as fast as many had hoped.

Wall Street, it appears, is more worried about Twitter’s ability to add users and keep them engaged than about its ability to increase revenues. In the last two quarters, that has been a problem. Twitter said it had 255 million monthly users globally in March, up 5 percent from 241 million at the end of December, which ended a quarter in which monthly active users rose less than 4 percent.

But most disconcerting for shareholders is that Twitter made $1.44 in advertising revenue for every 1,000 timeline views, down from $1.49 in its previous quarter. That may be the best marker of Twitter’s ability to make money from its platform, and in the first quarter it was trending down. In a call with analysts, Twitter’s executives attributed some of that to seasonality because the fourth quarter tends to be the most profitable.

Twitter’s revenue in the first quarter, which ended March 31, was up 119 percent to $250 million from $114 million in the first quarter of 2013. Twitter posted a net loss of $132 million, compared with a loss of $27 million a year ago. Adjusted earnings, however — which exclude stock-based compensation and other expenses — were $183,000, or about break-even per share, compared with a $10.5 million loss a year ago.


3 Workplaces with 'toxic' environments (Kim Thompson in San Francisco Chronicle) Do you think your workplace might be toxic? Most people spend the majority of their lives at work, and studies repeatedly show happy employees are more productive. Companies that treat their employees well will earn huge dividends compared to those that dismiss and ignore their workforce. However, under siege to reduce expenses and stay afloat amid the rising cost of doing business, some working environments have turned into toxic cultures that make the workplace almost unbearable.

Do these comments sound familiar?: If I don’t leave my job, I will lose my mind. I feel like I am in prison. I don’t have a life anymore; it’s all work. My boss is making me crazy. Everyone around me is negative.
If so, there is a strong possibility you are hearing a description of a toxic work environment.  To some, the word toxic may seem too extreme for their workplace, while others heave a sigh of relief to discover someone has put a label on the way they are feeling.

A toxic workplace is one that causes emotional and physical reactions over a period of time that diminishes productivity and happiness. Quite literally it resembles poison to your career and well-being. The good news is that a toxic work environment is not permanent one and recovery takes place once you identify the problem and develop a plan of action.

Here are five ways to tell if your workplace is becoming toxic to your well-being: Increased anxiety: 1You live in a constant state of worry that you are doing something wrong. 2 Anger: This can include an increased level of irritability, being short-tempered with those around you, being less patient or participating in blaming others. 3 Lack of control: This can happen over time when you are overwhelmed with work pressures or change. 4 Loss of confidence: When you start doubting your abilities to do your job, that’s a red flag you may be in a toxic work environment. 5 Diminished relationships: This evolves slowly, but you may find yourself gradually losing interest in going out, being too fatigued to socialize.

Overcoming a toxic workplace can be a challenge, but there is often a sense of freedom that comes from understanding the situation you are in. You have a choice how you react to an unhealthy situation. There is hope. You can take back your life and find happiness in your career.


Monday, April 28, 2014

US, EU sanctions on more Russia firms; Big money and a tech bubble; Blurring the line between man and machine; Canada for wifi in the woods

1 US, EU sanctions on more Russia firms (Khaleej Times) The US has imposed new sanctions on seven Russian officials and 17 firms linked to President Vladimir Putin’s inner circle even as the European Union added 15 more officials to its sanctions list. Deepening the worst East-West showdown since the end of the Cold War, Washington is also tightening licensing requirements for certain hi-tech exports to Russia that could have a military use.

“The United States has taken further action in response to Russia’s continued illegal intervention in Ukraine and provocative acts that undermine Ukraine’s democracy and threaten its peace, security, stability, sovereignty, and territorial integrity,” said White House spokesman Jay Carney in a statement. Carney said Russia had done nothing to meet the terms of a deal agreed in Geneva with Ukraine, the European Union and the US and designed to rein in pro-Moscow separatists in eastern Ukraine.

The sanctions follow up on previously announced measures targeting other members of Putin’s political and inner circle and a Russian bank. The measures are designed to build economic and political pressure on Putin, and to try to force a change of tactics in Ukraine. They do not however specifically target sectors of the Russian economy like energy and mining.

The EU is Russia’s biggest trading partner, giving it greater economic leverage over Moscow than the US. However, the EU treads more carefully in imposing sanctions since Russia is also one of its biggest oil and gas suppliers — and the bloc apparently shied away from following Washington’s lead in targeting specific Russian companies.


2 Big money and a tech bubble (Thomas Lee in San Francisco Chronicle) When David Einhorn speaks, the world usually listens. That doesn't mean what he says is particularly new or even insightful. "Now there is a clear consensus that we are witnessing our second tech bubble in 15 years," the founder of hedge fund Greenlight Capital wrote last week to his investors. "What is uncertain is how much further the bubble can expand and what might pop it."

As Einhorn so eloquently put it, predicting what will pop a bubble and when it will happen is beyond the reach of even superstar investors. There are plenty of people today who deny a bubble even exists. It's as if the dot-com bust in the early 2000s never happened. This time, the bulls cry, it's different. They're right. It's worse.

Back in the dot-com era, investors bid up technology stocks because the Internet was something new and exciting. Today, investors are much more educated about the Internet, and they are still dumping huge stacks of cash on startups. Not because Internet-related companies are the best bet in town, but because they seem like the only bet in town.

Last year, software and Internet-related companies captured 62 percent - $18.1 billion -of the $29.4 billion dished out to startups by venture capitalists, according to the MoneyTree report by PricewaterhouseCoopers and the National Venture Capital Association. The report indicates that those industries are attracting dollars at levels not seen since the last tech bubble. Meanwhile, biotech and medical device firms attracted only 22.4 percent of VC money. Medical device dollars alone fell 17 percent, compared with 2012.

Why do investors ignore biotech and medical devices? The main reason is that such technology takes too long to win approval from the Food and Drug Administration, especially medical devices. If investors don't want to back these industries, they need to put their money somewhere. And frankly, Internet and software companies not only offer the prospect of a quick and lucrative payday, but they are also easier to understand. When you have investors with too much money and too few options, something's bound to pop.


3 Blurring the line between man and machine (Juliette Garside in The Guardian) The realm of artificial intelligence could contain the greatest prize, achieving a union of man and machine that is often referred to as "the singularity" – a phrase first used by the American futurologist Ray Kurzweil. The accepted wisdom is that such a leap, if it can happen, is at least 30 years away. Experts now argue that the moment is closer than you think and Kurzweil is one of the figures accelerating our encounter with the future, as Google's director of engineering.

"The amount of money that Google and other commercial companies will pour into robotics and artificial intelligence could at last take it truly into the commercial world where we actually do have smart robots roaming our streets," says Noel Sharkey, professor of artificial intelligence and robotics at the University of Sheffield.

Turning the classic industrial investment model on its head, consumer technology groups are using their cash mountains to superfund areas of research that were until now the preserve of governments, defence companies and academics. Over the past year, Google has bought seven robotics companies, including Boston Dynamics. It has bought firms that specialise in natural language processing, gesture recognition, and more recently in machine learning, highlighted by the acquisition of British startup Deepmind – bought in January for $400m.

For those struggling to understand why Google or Amazon should want to invest in self driving cars, internet drones and robotics, the answer is data. Masses of it. The parking meter in your street, the collar on your cat, the thermostat in your home will emit signals that can be picked up from anywhere, and Google will be listening. If Silicon Valley's best minds succeed, their software will not only be listening, it will be understanding and anticipating. When it comes to mundane chores such as stocking the fridge or ordering birthday presents, software will be doing our thinking for us.

For some scientists, such as wearable computing pioneer Thad Starner, who is a key engineering figure behind Google Glass, man and machine are already merging. "I would argue that we're currently living the singularity," he said in a recent interview. "Where the tool stops and the mind begins will start becoming blurry."


4 Canada for wifi in the woods (Straits Times) For those who cannot face social media exile when they head to the cottage, lake or woods, Parks Canada says it will offer wi-fi in some of its spectacular outposts. The federal agency that runs 44 national parks and 160 historic sites - from the Bay of Fundy on the Atlantic to the Rockies to Baffin island in the Arctic - wants to appeal to those who may not be able to embrace old-school quiet solace without posting about their trip in real time.

For now, Parks Canada will outfit 15 to 20 of its sites, in a sort of trial phase, to see how it goes, said Mr Francois Duclos. The goal is to bring 75 of its sites online with wifi in the next three years, he said.

- See more at: http://www.straitstimes.com/news/world/americas/story/wifi-the-woods-canada-says-yes-and-oui-20140429#sthash.FsyQdfAR.dpuf


Sunday, April 27, 2014

UK outlook 'exceptionally strong'; For middle classes, the American dream is just a dream; The scarcity fallacy

1 UK outlook 'exceptionally strong' (BBC) The outlook for the economy over the next three months is "exceptionally strong" according to the employers' organisation the CBI. Its latest monthly survey of 675 firms, indicated that growth expectations were the strongest since the CBI started collecting data in 2003. The data for April showed a growth in output for businesses surveyed. Retail and services showed the strongest output growth, while manufacturers reported solid progress.

In a statement the CBI described the outlook for the next three months as "exceptionally strong and broad-based". The organisation's chief policy director Katja Hall said: "These latest growth figures, and the strong expectations for the next quarter, provide further encouraging signs of increasing vigour and confidence across the UK economy. "While consumer spending accounted for the lion's share of GDP growth last year, there are firm indications of growth becoming more broad-based."

Earlier this month the Office for National Statistics (ONS) confirmed that rises in weekly earnings have finally caught up with inflation. That was seen as a significant moment for the economy and could boost growth in the future.


2 For middle classes, the American dream is just a dream (Michael Cohen in The Guardian) During the 2012 presidential election, Republican nominee Mitt Romney regularly liked to joke that President Obama wanted the US economy to look "more like Europe". In the context of modern American politics, few insults are more stinging. To be European is to be somehow effeminate, irresolute and, perhaps worst of all, socialist. It's the opposite of the "rugged individualism" and "exceptional nature" of the uniquely American experiment in self-government.

But, as a sobering New York Times article last week made clear, America could have a lot to learn by looking to Europe. According to the New York Times, the American middle class – the linchpin of the country's phenomenal post-war economic growth – can no longer call itself the richest in the world. "While the wealthiest Americans are outpacing many of their global peers," says the NYT, "across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades." America's poorest citizens lag behind their European counterparts; 35 years ago, the opposite was true.

While a majority of Americans tenaciously continue to hold dear to the American Dream – that long-standing American ideal that if you work hard anything is possible – more and more people are reporting that the opportunity for social advancement feels increasingly out of reach for them and their children. Indeed, it is hard to think of a more disquieting trend in American society than the fact that those in their 20s and 30s are less likely to have a high school diploma than those between the ages of 55 and 64.

Granted, no one actively set out to attack the middle class in America. There wasn't some evil plan hatched behind closed doors to wreak socio-economic havoc. But the decline of the American middle class, the ostentatious wealth of the so-called 1% and the crushing economic anxiety of the growing number of poor Americans have happened in plain sight. It is the direct result of a political system that has for more than four decades abdicated its responsibilities – and tilted the economic scales toward the most affluent and well-connected in American society. The "choice" that America made to pursue the path of decline will be with us for some time to come. Kind of makes looking to Europe seem like not such a bad idea.


3 The scarcity fallacy (Matt Ridley in The Wall Street Journal) How many times have you heard that we humans are "using up" the world's resources, "running out" of oil, "reaching the limits" of the atmosphere's capacity to cope with pollution or "approaching the carrying capacity" of the land's ability to support a greater population? The assumption behind all such statements is that there is a fixed amount of stuff—metals, oil, clean air, land—and that we risk exhausting it through our consumption.

But here's a peculiar feature of human history: We burst through such limits again and again. After all, as a Saudi oil minister once said, the Stone Age didn't end for lack of stone. Ecologists call this "niche construction"—that people (and indeed some other animals) can create new opportunities for themselves by making their habitats more productive in some way. Agriculture is the classic example of niche construction: We stopped relying on nature's bounty and substituted an artificial and much larger bounty.

Economists call the same phenomenon innovation. What frustrates them about ecologists is the latter's tendency to think in terms of static limits. Ecologists can't seem to see that when whale oil starts to run out, petroleum is discovered, or that when farm yields flatten, fertilizer comes along, or that when glass fiber is invented, demand for copper falls.

Economists point out that we keep improving the productivity of each acre of land by applying fertilizer, mechanization, pesticides and irrigation. Further innovation is bound to shift the ceiling upward. Jesse Ausubel at Rockefeller University calculates that the amount of land required to grow a given quantity of food has fallen by 65% over the past 50 years, world-wide.

Why did scarcity theories not materialise? In a word, technology: better mining techniques, more frugal use of materials, and if scarcity causes price increases, substitution by cheaper material. We use 100 times thinner gold plating on computer connectors than we did 40 years ago. The steel content of cars and buildings keeps on falling. Thanks to fracking and the shale revolution, peak oil and gas have been postponed.

Haiti is 98% deforested and literally brown on satellite images, compared with its green, well-forested neighbor, the Dominican Republic. The difference stems from Haiti's poverty, which causes it to rely on charcoal for domestic and industrial energy, whereas the Dominican Republic is wealthy enough to use fossil fuels, subsidizing propane gas for cooking fuel specifically so that people won't cut down forests.

If I could have one wish for the Earth's environment, it would be to bring together the two tribes—to convene a grand powwow of ecologists and economists. I would pose them this simple question and not let them leave the room until they had answered it: How can innovation improve the environment?


Saturday, April 26, 2014

G-7 nations for more sanctions on Russia; For Britain, a low-pay 'recovery' built on the back of working poor; How suicide and politics mix in India

1 G-7 nations for more sanctions on Russia (San Francisco Chronicle) The US and other nations in the Group of Seven have agreed to "move swiftly" to impose additional economic sanctions on Russia in response to its actions in Ukraine. In a joint statement by the White House, the G-7 nations said they will act urgently to intensify "targeted sanctions." The statement said the G-7 will also continue to prepare broader sanctions on key Russian economic sectors if Moscow takes more aggressive action. The White House said US sanctions could be levied as early as Monday.

The announcement came as top Ukrainians spoke of imminent invasion and Moscow said that pro-Russian separatists would not lay down their arms in eastern Ukraine until activists relinquish control over key sites in Kiev. The G-7 nations said they were moving forward on the targeted sanctions now because of the urgency of securing plans for Ukraine to hold presidential elections next month. The penalties are expected to target wealthy Russian.

Accusing the West of plotting to control Ukraine, Russian Foreign Minister Sergey Lavrov declared that pro-Russia insurgents in the country's east would only disarm and leave the territory they have occupied if the Ukrainian government clears out a protest camp in Kiev's Independence Square, known as the Maidan, and evicts activists from other ococcupied facilities. Ukraine's reaction was swift. "The world has not yet forgotten World War II, but Russia is already keen on starting World War III," Ukraine's acting prime minister, Arseniy Yatsenyuk told a meeting of his Cabinet.


2 For Britain, a low-pay 'recovery' built on the back of working poor (Katie Allen in The Guardian) Britain's rise up the growth rankings has attracted plenty of attention, but its position near the top of a much less appealing record table remains little discussed. Britain is a leader at low pay too. One in five workers earns less than the living wage – higher than the minimum wage but the figure deemed by campaigners to be the actual bare minimum for getting by. The incidence of low pay in the UK puts it high on a league table of mostly rich countries watched by the Organisation for Economic Co-operation and Development.

We have low pay, insecure zero-hours jobs and surge in underemployment – where people work fewer hours than they would like. Britain has a growing problem of in-work poverty – a problem more likely to hit the less-qualified, young people, women and ethnic minorities. This presents a conundrum for politicians, and sits uncomfortably with the widely espoused principle that work is the surest route out of poverty. The reality is that, for many families, work and poverty are not mutually exclusive.

This sorry development has both moral and economic repercussions. On the former, there is wide-ranging evidence that many remain trapped in working poverty because they are less likely to be offered training that could help them move up to better-paid roles. From an economic perspective, the drawbacks for businesses of low pay are high staff turnover, higher absenteeism, poorer morale and lower productivity. The bigger picture for the UK economy relates to productivity, which is improving more slowly than in other advanced economies.

There are no easy answers to this growing in-work poverty problem, as the labour market expert John Philpott points out in his paper for the Joseph Rowntree Foundation. But policymakers and employers can take concrete steps in three areas. Firstly, those employers that can afford to pay more must pay more.

Employers that cannot raise pay can give more to their workers in other ways. The final area is the urgent need to bring legislation up to date with a changing labour market. But fundamentally, what really needs to change is the misguided view that any job is better than no job. Jobcentres must be measured on the kind of jobs they fill, not just the numbers of unemployed they cut.


3 How suicide and politics mix in India (Sonora Jha in The New York Times) As politicians scramble for India’s 815 million votes in the most expensive and closely contested general election in the nation’s history, an unexpected protest is rumbling from what was once one of the country’s most placid voter blocs: its farmers. The protest is inflamed by rising attention to the shocking suicide rate on India’s hardscrabble farms. 

Since 1995, more than 290,000 farmers have killed themselves. Though that figure, compiled by the National Crime Records Bureau, is sketchy at best, perceptions are what counts in politics. Assertions that the suicide rate among the country’s agricultural workers is nearly three times the national average are widely believed in India, but precise figures are difficult to come by. The World Health Organization estimates that roughly 170,000 Indians in all walks of life commit suicide every year; the Indian government put the figure at about 135,000 in 2010. 

That is misleading, not least because suicide is a crime in India, and as such falls under the purview of the National Crime Records Bureau. The social stigma it brings, and the risk that it may mean a loss of government compensation, feeds a family’s reluctance to report such deaths. Whether or not perception exceeds reality, there is no denying that India’s farmers have taken a battering in recent years. The global competition that came with the liberalization of the Indian economy in 1991 has cut into earnings. 

Thousands of farmers and their families gathered on March 15 at Bhimkund village in Vidarbha, where a farmer named Kiran Kolvate led the protest. “All political parties across the spectrum have totally ignored the plight of half a million farmers,” she declared, urging the crowd to vote “None of the Above” (NOTA).That rallying cry is spreading. On April 7, the day India began five weeks of voting, people from 25 farming villages in the northern state of Uttar Pradesh declared that they too would mark their ballots NOTA. In choosing “None of the Above,” many farmers are demanding that India’s leaders take action to end the misery undermining one of the key sectors of the economy.