Saturday, February 8, 2014

8/2/2014: Services Index: Monthly Series December 2013


CSO released cheerful headlines for Irish Services Index, measuring activity in the largest part of the Irish economy.

Here's from the CSO release: "The seasonally adjusted monthly services value index increased by 1.3% in December 2013 when compared with November 2013 and there was an annual decrease of 1.5%."

Oops… things are up m/m and down y/y. But obviously the headline reads only the former, none of the latter.

"On a monthly basis, Information and Communication (+5.4%), Professional, Scientific and Technical Activities (+3.5%) and Administrative and Support Service Activities (+2.3%) showed increases when compared with November 2013.    Other Service Activities (-3.2%), Transportation and Storage (-1.6%), Accommodation and Food Service Activities (-1.1%) and Wholesale and Retail Trade (-1.0%), decreased when compared with November 2013."

Spot the problem? Controlling for ICT services (wait till Yahoo washes all its tax arbitrage through Dublin next) the only tangible, value-added activity that rose was Professional, Scientific and Technical Activities. We have no idea what drove this, but a rise here, excluding insolvency and mortgages arrears-related services and collection agencies would be helpful.

You really have to look at annual basis decomposition to see what is happening in the economy, though: "On an annual basis, Administrative and Support Service Activities (+27.7%), Information and Communication (+4.0%) and Accommodation and Food Service Activities (+2.4%) increased when compared with December 2012." That was is for increases: more paper pushing across tables, more back office supports and more adjoining ICT services. On the other hand, the rest of services are tanking: "Professional, Scientific and Technical Activities (-9.1%), Wholesale and Retail Trade (-8.2%), Transportation and Storage (-6.8%) and Other Service Activities (-6.5%) decreased when compared with December 2012."


So let's illustrate the above 'trends' in a few charts.




 Do keep in mind that, ex-ICT services, the Professional, Scientific and Technical Activities are our 'knowledge economy'. The trend here is down, down and down.

But now for the services sector overall:


The trend above is clearly showing a marked slowdown in activity in Q3-Q4 2013, just when we were being fed a steady diet of 'Things are Only Getting Better'. Am I missing something here? With all the ICT Services booming and all the Admin and Backoffice activities rising, we were supposed to get a strong retail season and a hopium-filled boost to domestic services too... But, apparently, we are having trouble recording these magnificent increases in the data?.. Oh, and do note, the data is in value terms, so inflation here is helping to push 'activity' up.

And the PMIs were booming too, for Services, just as the services activity was slipping?..


Next post will take a deeper look at the dynamics, controlling for monthly volatility. Stay tuned.

Friday, February 7, 2014

7/2/2014: US Labour Force Participation Rate


Illustrating the disaster that is US Labour market:


via Ioan Smith @moved_average

The latest reading is 62% for January 2014. We are in the late 1970s, just after the infamous bouts of stagflation have ravaged the US economy, setting stage for the Reagan's 'revolution'…

In trailing news, of course, the Non-Farm Payrolls report for January was a massive miss on expectations, with only 113,000 new jobs actually recorded against the analysts' hopium fuelled 180,000 expectation.

With that, employment to population ratio (the one I track for Ireland and the one many Irish economists and media talking heads are saying I should not track - cause they don't like it) rose to 58.8%.

Unemployment fell from 6.7% to 6.6%, getting dangerously close to the Fed's imaginary 6.5% bound (the promise of Fed hiking rates at/after 6.5% is about as real currently as the promise of Mario Draghi to 'activate' OMT). But on a big positive side: unemployment rate for those with only a high school education fell from 7.1% to 6.5% as construction industry started hiring once again skill-less workers.


Note: for Ireland, participation rate currently stands at 60.7% (Q3 2013) down from 64.7 in Q3 2007 so proportionately, Irish decline is slightly smaller than the US decline...

Thursday, February 6, 2014

6/2/2014: What Does the Future Hold for Ukraine: ECR Comments


ECR published four expert comments about the state of the Ukrainian economy: http://www.euromoneycountryrisk.com/Analysis/ECR-Forum-What-does-the-future-hold-for-Ukraine-

Here are the comments (including my own) for those who have no access to ECR site (click on image to enlarge):





6/2/2014: Rip-Off Ireland: Alive and Kicking… Courtesy of the State


This is an unedited version of my Sunday Times article from January 26, 2014.


Ninety five years ago, in his book The Economic Consequences of Peace (Chapter VI, pg.235-236), John Maynard Keynes observed that "By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens."

This week's announcement of price hikes by VHI serves as a timely reminder of the salience of Keynes' analysis.  As are the CSO release of comparative data for the cost of living and income per capita for Ireland and the rest of the EU.

The former shows the extent of the ongoing confiscation of households’ wealth through targeted price increases – a core feature of Irish response to the crisis. The latter highlights the combined effects of inflation and income declines on Irish consumers. In 2012, Ireland was the fifth most expensive state in the European Union in terms of the cost of final consumption by private households. At the same time, Irish per capita pre-tax national income, adjusting for purchasing power differentials, was only 11th in the EU.

Irish recovery from a deep fiscal and financial crisis has been a tale of financial repression. Since 2008, our successive Governments have underwritten the status quo of inefficiencies in public services, as well as the cost of recapitalizing the failed banks using the sweat and blood of Irish consumers and taxpayers. As a by-product of this, the state transferred vast amounts of wealth and income from the Middle Ireland and the less well-off households to state-protected and often state-owned producers of goods and services.


Significant parts of these transfers took form of targeted inflation.

Per CSO data, released earlier this month, average annual consumer inflation in 2013 fell to just 0.5 percent, less than one quarter of the average annual inflation recorded in 2011-2012. However, underlying these figures, there is a growing disparity between price trends in the sectors dominated by the state and the sectors where private enterprises compete directly for consumer demand. Not surprisingly, the highest inflation over 2013 was recorded in state-priced and state-owned sectors, such as Education, where prices rose more than nine times faster than across the whole economy.

Looking at the longer-range data reveals an even greater divergence between the state-controlled and market prices. Since the beginning of 2008 through December 2013, aggregate consumer prices rose by slightly more than 3 percent in cumulative terms. Over the same period of time, state-controlled prices were up 22 percent. These sectors cover goods and services that account for around one third of all household consumption in Ireland. Meanwhile, private sectors prices are up only 0.2 percent.

Take the Housing, Water, Electricity, Gas and Other Fuels category, where cost of services to Irish consumers, on aggregate, fell 3.7 percent between 2007 and 2013. This decline was driven by a 25 percent drop in Mortgage Interest costs and 13 percent decline in Private Rents. Costs also fell across virtually all maintenance and repair services associated with housing. In contrast, Local Authority Rents and state-controlled gas prices rose almost by one fifth over the same period. Cost of electricity was up 26 percent. All state-controlled or regulated prices within this group are on the rise, with majority posting double-digit inflation.  Price inflation in the energy sector is now so far divorced from underlying costs that a single new entry into the market by Energia is expected to drive prices down by some EUR 300 per annum, potentially erasing two thirds of the price hikes introduced over the last two years.

None of the above services, however, come close to the rampant inflation in Health and Education.

Since the onset of the crisis, costs of Hospital Services in Ireland rose more than 36 percent, over three times the rate of inflation for Outpatient Services. The very same policies that purposefully drove up the cost of Hospital Services are also responsible for a whooping 117 percent cumulative rise in Health Insurance costs since 2007. These policies forced health insurance purchasers to cover the shortfalls in funding available to the HSE, despite the fact that their insurance premiums and general taxes already fund state healthcare. As the result, the cost of health insurance rose at more than three and a half times the rate of inflation in home insurance costs and eleven times faster than inflation in motor insurance.

Tertiary education charges are up 60 percent since 2007. Private-sector dominated secondary and vocational education services meanwhile saw costs rise at roughly one third of the rate of inflation registered in our ITs and universities.

Based on CSO-estimated weights of different goods and services in a standardized consumer basket, inflation in controlled sectors is responsible for confiscating, using Keynes’ terms, just over 10 cents out of every euro spent on consumption of goods and services by an average household in Ireland since the beginning of the crisis. CSO and IMF reported producer prices and international exchange rates and inflation comparatives show that majority of these losses had nothing to do with increased costs of raw materials, intermediate goods and capital used in production. Put simply, they represent a crisis levy designed and imposed by the State and its semi-state companies.


Grim as they are, official inflation statistics, however, tell only a part of the story of wealth destruction imposed onto Irish consumers.

The above costs of inflation are compounded by the declines in Irish households’ disposable incomes due to various tax measures since 2008, combined with decreases in earnings and working hours. All in, Irish households’ today have around 12-15 percent lower disposable incomes than prior to the crisis. Factoring in the effects of unemployment and inflation, in terms of real purchasing power, Irish households are now down some 28 cents on the euro since the beginning of the crisis. Only around 2 cents of this decline is due to private sectors’ inflation with the rest taken up by changes to taxes, regulatory and pricing policies, plus by the monopoly power awarded to state-protected sectors.

Real Ireland - our lower-, middle and upper-middle classes - is paying the full price of the banking, fiscal and economic crises. Meanwhile, the State elites - senior public sector and semi-state officials, managers, politicians, state services executives and affiliated professionals - are ripping the benefits in form of jobs security, pensions and quality of life.


The economics of state confiscation of income through inflation and taxation do not end there, however. The real impact of these measures of financial and fiscal repression can only be dealt with in the context of their distribution across various households and demographics.

Normally, in response to price changes, consumers have an option to alter their demand for goods and services. In the case of ordinary consumption goods, this means that we switch away from more expensive alternatives.  Overtime, adjusting for quality of supply, our demand favors lower cost producers and suppliers, who gain market shares at the expense of more expensive, less-efficient ones. Thus, more elastic or more responsive demand helps not only to offset the painful costs of inflation in the short run, but also engenders innovation and competition in the longer term.

For example, during the current crisis, Irish consumers showed strong willingness to opt for discount stores when it comes to shopping for groceries and basic household items. Per latest reports from the retail sector, this Christmas, Tesco’s share of the Irish groceries markets shrunk by 6.2 percent at the expense of Aldi and Lidl which increased their share of the Irish market by double digits. A by-product of this is that the discounters are now offering increasingly more goods tailored to Irish tastes and are widening the breadth of offers in their stores across various segments of consumers. Another upside is that indigenous Irish competitors, such as SuperValu, are gaining the ground in this competition.

In contrast, consumers have little choice in switching away from the state-controlled or monopolised sectors. In 2013, Water Supply and Miscellaneous Services prices were up 64 percent on 2003 levels. More price hikes will come once Irish Water starts issuing charges under the state license to raise prices unabated for the first six years. All without any alternative of a different supplier being available to consumers.

Indirect effects of inflation are also stronger for consumers of goods and services with habitual or long-term demand. Healthcare and education are multi-annual commitments with little room for changing consumer behaviour in response to prices. Patterns of transport demand, linked to choices of location where one lives, are also less responsive to price changes, offering few options for trading out of the adverse effects of inflation. In all of these sectors, consumers have no choice but to pay for price increases. Demographically, younger households, usually heavily indebted via mortgages and struggling financially are the prime targets of this inflation.

Keynes had more to say about the role inflation pays in destroying households’ wealth and income. “… By this method [of inflation, the Governments] not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth."

In the case of Ireland during the current crisis, all of the above rings true, save for one important correction: Irish state-sanctioned inflation confiscates wealth and income by transferring money from productive private savings, investment, and consumption to shore up inefficient and often wasteful state services and semi-state sectors. There is little that is arbitrary in the context of the Rip-off Ireland ca 2014.





Box-out:

"You cannot corral a company to go to a particular part of the country unless it will make sense for their business ‐‐ particularly when the company's alternative location may be Amsterdam, Barcelona or Munich”. With these words the IDA spokesperson this week explained why agency-supported multinationals have been largely staying out of the regions, while flocking into Dublin. IDA made a perfectly valid point. Manufacturing exports, even stripping out patent cliff-hit pharmaceuticals, are barely expanding. Remote back office services – the bread-and-butter of so-called ‘call centres economy’ – are on decline across the advanced economies. This leaves what economists call human capital-intensive sectors – the ones largely dominated by jobs for highly-educated 22-35 year-olds coming choosing Ireland as their career stop-over. Working for Google, Facebook, Twitter and other internationally networked globally-trading multinationals, these employees do not want to live in the suburbs, let alone move to the countryside. They require cultural, social and economic amenities of large cities. Whether we like it or not, the MNCs of the 21st century inhabit the world where human capital defines productivity growth, profitability and value added. Bricks and mortar attractions of an IDA Park somewhere in the middle of nowhere do not. Time to bin Bertie’s Era Spatial Development Plans and to think how to transition our regional economic development model to a new and more sustainable basis.

6/2/2014: Euro Area Economic Conditions and Expectations: Ifo




The Ifo Indicator for the economic climate in the euro area for Q1 2014 is out today. Some positives, some negatives.

Overall index of Economic Climate in the  Euro Area rose from 114.7 in Q4 2013 to 119.9 in Q1 2014. Which is good - we are at the highest levels since Q3 2007. 

All improvement is due to improved assessment of the current situation: Present Situation index is up at 120.3 from 106.3 in Q4 2013. This is the highest reading for the index since Q4 2011. But if you think this is 'as good as it gets' we have some room to climb up, then, since the sub-index historical average is 126.9. With Germanic precision, the Ifo characterised the latest development as "far less unfavourable assessments of the current economic situation". Not a 'positive' or a 'favourable', but 'less unfavourable'.

Meanwhile, "the economic outlook for the next six months remains unchanged at the highest level for around three years. The economic recovery should become more marked in the months ahead." This references the fact that Expectations for the Next 6 months index is stuck at 119.7 in Q1 2014, same as in Q4 2013. Which is significantly above historical average of 94.7. 

But expectations mean little. One bizarre quirk is that crisis-period average for the series is 95.9, which is above the historical average. Which, obviously, begs a question: Just how much does the forward optimism track the future outcomes? Apparently, not much. There is a negative historical correlation of -0.18 between expectations and current conditions assessments, so in a sense expectations just tell us that, on average, business leaders expect improvement in the future when conditions are poor today. I showed before that once you check for lags, 6mo forward expectations do not do much to forecast outcomes registered for current conditions 6 months after the expectations are issued. And I have tested not just point lags, but also 6mo averages. The result is still the same: all expectations are telling us is that when things are terrible today, businesses expect them to improve tomorrow. This is like telling us that growth conditions are mean-reverting. Which is, of course, the case. Even in North Korea.

Expectations gap to current conditions has fallen, as current conditions improved. The gap now stands at 99.5 down from 112.6 in Q4 2013. The gap confirms what we learned from expectations series. Average expectations gap during the crisis is 153.8 and historically it is 88.5, which shows that businesses form much more optimistic forward expectations during the crisis period than in other periods. 

Some charts:




Few more points, this time straight from the Ifo release: 

"Germany, where the very positive economic situation continued to improve, received the best assessment. More economic experts were also positive about the current economic situation in Austria. Latvia, which introduced the euro as a currency at the beginning of the year, and Estonia are also among the few countries in the euro area where the current economic situation is deemed satisfactory overall. The present economic situation in Greece, Italy, Portugal, Spain and Cyprus, by contrast, barely changed compared to the last quarter and remains at a crisis level. In Belgium, Ireland and The Netherlands the economic situation improved somewhat compared to last quarter, according to WES experts, but remains "unfavourable" as in Finland and France.

Expectations for the next six months remain at a high level in almost all euro area countries apart from Greece and France, where the experts surveyed were less positive than three months ago. Cyprus is the only country in which experts expect the economic situation to deteriorate further.

The forecast inflation rate for the euro area for 2014 of 1.5% is slightly below the estimated rate for 2013 (1.7%). While experts expect the short-term interest rates to remain stable for the next six months, a greater number of survey participants expect long-term interest rates to rise. The majority of economic experts believe that the euro is overvalued against the US dollar and the Japanese yen. They expect the US dollar to appreciate against the euro over the next six months."


So good news: the incoming freight train of rising rates is yet to reach the tunnel. The bad news is that the 'periphery' is still stuck in the said tunnel, while the 'soft core' of Belgium, Ireland (welcome to the club) and the Netherlands is barely clawing its way toward the exit. The other good news is that the incoming commuter train of exchange rates (effect on exports) is slightly delayed (we can expect some depreciation of the euro before interest rates hikes hammer us back into the FX corner).

6/2/2014: Dependency Ratios Out to 2050


You've heard many analysts talking about the 'demographic dividend' for Ireland as if young people (we still have more of them than other countries in Europe) can be locked safely within the shores of this island. But supply of emigrants from this (and any other country) is driven, in part, by the demand for younger workers in the labour forces around the world. And here things are rather testy:


So that story of the 'demographic dividend'... do we have a policy plan for protecting or securing it here in Ireland? one can only keep hoping... 

Tuesday, February 4, 2014

4/2/2014: More spin needed, urgently... as Trust in Government sinks


Edelman Trust Barometer 2014 was published last week. Here is the link to the full presentation: http://www.slideshare.net/edelmanireland/edelman-ireland-2014-trust-barometer

And a couple of summary slides:

 Global trust scores:

  • NGOs lead with total trust 64% in 2014 up on 63% in 2013
  • Business is second with 58% in 2014 unchanged on 2013
  • Media on behind Business with 52% trust, down from 57% in 2013
  • Government least trusted, with 44% in 2013, down from 48%.
Meanwhile in Ireland, things are even more stark:



  • NGOs trust down from 63% in 2013 to 58% in 2014 - now below the global levels from previously global average levels
  • Business is again second, with trust falling from 44% in 2013 to 41% in 2014 - both below global averages
  • Media is in the third place with trust declining from 45% in 2013 to 37% in 2014 survey - both below global averages
  • Trust in Government in Ireland sunk to 21% in 2014 (less than 1/2 of the global average) and down from 32% in 2013. 

Trust index overall has dropped from 46 to 39 between 2013 to 2014 - a massive drop from already low levels:

 And the perceived quality of institutions is declining from 2009 on for the Government:


On 2009-2013 average:

  • NGOs: 54.6% average is below 58% level in 2014
  • Media: 37.0% average is identical to 2014 reading of 37%
  • Business: 40.4% average is below 2014 level of 41%
  • Government: 29.2% average is well above current level of 21%.
So of all institutions, the only one that deteriorated in terms of trust in 2014 compared to 2009-2013 average is... Government.

Time to pump out more Government spin and 'Economic Outlook' presentations by quangos and Departments... 

4/2/2014: Good at anything? Europe's broken monetary policy engine


Monetary policy is not a nuclear science. It is not even anatomy, for what it matters. Instead, it is more like a simple task in civil engineering. Bank of Japan can get the message, the Fed wrote books on it, Bank of England has discovered it, Canadians, Swedes, Danes, Swiss, everyone has figured it out by now... Meanwhile, in the euro area, there is a whole lot of mystery, mystique, halls of mirrors and corridors of contortions, when it comes to the monetary policy. And a simple, plain-sight visibility of its failure…

Take a look at this chart, plotting euro area real GDP growth against M1 money supply growth rate (via Pictet):


Spot anything of interest? Oh, simples.com: M1 growth declines predate GDP growth and levels declines. No, seriously, since 2006, euro area could not manage one policy - money supply. Forget the intricacies of fiscal policy (it is not an easy job to spend money on stimulating economic activity, when you are in debt up to your ears), the EU simply could not put enough money into the real economy to prevent cash in circulation from shrinking.

How on earth can such a feat be achieved? Simple: the ECB pumped trillion euros plus into the banks, instead of pumping the very same trillion (and more still would have been needed) into the real economy. Frankfurt opted for loading money into the banks balance sheets . It should have opted for using printed money to pay down real economy's debts (households' and non-financial companies' debts) which would have (1) repaired banks balance sheets, and (2) repaired the real economy, restarting consumption and investment. Instead, we have a bizarre, senile, idiotic situation where we print money and then, de facto, lock it up in the vaults.

It would half as bizarre if it was just locking the liquidity in the vaults, but the euro area monetary policy is currently all about the repayments by the banks of the LTROs, or in different terms - burning of cash out of the economy. This is cutting down on M1 growth rate. Just as the M1 growth should be rising, not falling. Forget about doing the right thing at the wrong time… we are doing the wrong thing at the wrong time… and doing so repeatedly.

And the latest? Annual growth rate of M3 money supply is again slowing, to 1.0% y-o-y in December 2013 from already low 1.5% y/y growth in November. The law of under fulfilled low aspirations clearly at work: expectation was for 1.7% y/y growth in M3, and ECB delivered 1.0% - the lowest rate since September 2010. Oops, predictably, lending to the private sector remained at -2.3% y/y in December 2013, an all-time low.


So for all its OMT, LTROs, BU 'policies activism', the ECB is now 5th year into mismanaging basic crisis-related monetary policy. Inventiveness and monetary engineering gushing out of Mario Draghi left, right and centre to the delight of the policy analysts and bonds salesmen, and the euro area is still where it was: below reference line on M3 growth.

Monday, February 3, 2014

3/2/2014: Good Plans = Good News: Irish Whiskey


Those of you who have been reading my work over the years know that I am big supporter of independent craft whiskey distillers in Ireland and been arguing in favour of policy supports to strengthen indigenous sector here.

So it is good to see some serious growth in the sector here. The latest numbers, provided by the Irish Spirits Association are below:


While still trailing behind Scotch, we are starting to gain some ground. The key here is, however, the number of distilleries. At only 4, Irish whiskey sector remains firmly captured by big, commoditised, lower-quality price-competition focused producers. The sector is still lacking innovation and competition.

The positive is that over the next couple of years there some 11 additional distillery projects underway or being planned in Ireland. By 2020, the sector potential is projected to double to over 12 million cases exported annually, from current 6.2 million. But even at these levels, Irish whiskey will remain under-represented in the global markets compared to Scotch, unless Ireland gets serious at pushing up the value of its whiskey. And this can only be done by careful and rapid innovation and focus on high quality, specialist whiskeys.

The ISA clearly identifies core markets for Irish whiskey as the US, followed by the UK, with "...emerging markets such as Russia and China present significant opportunity for future export driven growth in the sector." Surprisingly, India is not cited. Neither is Japan. Both are big whiskey markets and both offer significant upside for quality premium whiskeys. 

Sunday, February 2, 2014

2/2/2014: IMHO-AIB Pilot - First Results


IMHO just published the results of the ongoing IMHO-AIB project for the first 55 days of the scheme operations:
https://www.mortgageholders.ie/blog/posts/progress-update-on-initiative-between-imho-and-aib-ebs-haven

The core numbers are sizeable enough to represent a good sample of borrowers and provide a strong basis for arguing that the independent, professionally provided and borrower-centric advice does work.

I want to stress that all credit for delivering on these results goes to the brilliant frontline team at IMHO!

Saturday, February 1, 2014

1/2/2014: WLASze: Weekend Links on Arts, Sciences and zero economics


This is WLASze: Weekend Links on Arts, Sciences and zero economics. Enjoy!

Richard Mosse is on show at RHA in Dublin - an even that is an absolute 'must-see': http://www.rhagallery.ie/exhibitions/theenclave/ I covered Mosse's work earlier in relation to his fantastic show at Biennale earlier in 2013 (http://trueeconomics.blogspot.ie/2013/07/2772013-wlasze-part-1-weekend-links-on.html) and had a distinct pleasure attending the RHA exhibition launch. RHA presentation of his photographs and a separate film-based installation are superb and do proper justice to the tremendously important artist. The exhibition also contains one large photograph that was not on show in Venice.


@RHAgallery

And while at RHA, do not (not that there is any fear you would) miss their superb mini-retrospective of Micheal Farrell - an exhibition spanning the career of one of Ireland’s most accomplished artists, showing both his search across styles and narratives over the years and the emergence of his unique, personal voice. For myself, not all too knowledgeable about Irish artists of the period, this was an eyeopening exhibition.



Now onto more international scene...

My penchant for Science Meets Art themes is being well-catered for by Adam Summers photography that combines use of dyes and fish to reveal the natural beauty of skeletal structure: symmetry, complexity and patterns:
http://www.designboom.com/art/adam-summers-dyes-fish-specimens-to-reveal-their-anatomy-12-19-2013/


When nature meets the power of contrast and the two meet the human eye, values, semiotics, interplays of colour and light and geometry of proximate symmetry - all come into play.



On the opposite side of the same clustering of art and science, the contrast is amplified through superficial tech:
SOICHIRO MIHARA won 17th Japan Media Arts Festival award, here is his collaborative project from 2011, Moids 2.1.3 - acoustic emergence structure: http://www.samtidskunst.dk/simpleinteractions/projects/soichiro-mihara-hiroko-mugibayashi-kazuki-saita/

The installation combines 1024 autonomously functioning units that record the sounds of their proximate surrounding, and combine a micro-cprocessor that analyzes the recorded sound. The sound is recorded based on the programmed limits which trigger both the start and end of the recording for a specific unit, plus the triggering algorithm for chain reactions.




Big controversy in NY: after pretty lengthy period of speculations and debates, MoMA announced recently that "after an "exhaustive" analysis of the different options (razing the former Museum of Folk Art on 53rd Street, saving the distinctive facade, or saving the building), the museum had reluctantly decided (feel free to roll your eyes here) to demolish the Tod Williams & Billie Tsien-designed structure to make way for a museum expansion and, not at all coincidentally, an 82-story residential tower developed by Gerald Hines and designed by Jean Nouvel."
http://www.metropolismag.com/Point-of-View/January-2014/Done-Deal-MoMA-To-Raze-Folk-Art-Museum/
Here are some images of the museum building:



Sadly, I must add… sadly. The Folk Moma is a brilliant design, architecturally challenging and powerful, breaking up the monotonously 'Manhattanite' space… All to be replaced by what amounts to a spiced-up version of corporatism…


To pure art: Kristian Rothstein an interesting developing artist worth following for abstract art fans: http://kristian-rothstein.com/Weis-1


Still raw and searching, and mostly borrowing from Gerhard Richter, Rothstein is one to watch as he draws on some nicely intuitive, organic sensitivity in his use of colour.


Talking about sensitivity, while swinging a massive u-turn from art to science, here is a story from physics: the far-reaching idea for a Death Star-styled laser that can focus particles into a massive space telescope:
http://arstechnica.com/science/2014/01/giant-laser-could-arrange-particles-into-enormous-space-telescope/
Description via arstechnica is brilliant: "let me present the trifecta of awesomeness: a seemingly ridiculous idea, one that works in a bizarre manner that has little to do with the justification given by the scientists, and—to really make matters special—it involves lasers in space." The rest of this article is mind-boggling and can pass as a good teaser for one of those "Mind-Training" programmes that simultaneously burns vast amounts of calories and flexes your brain… rend and enjoy…


Last week I tweeted about the shortlisting of the Dublin-based Heneghan Peng practice for designing Contemporary Arts Center in Moscow. Here's the link:
http://www.architecturefoundation.ie/news-item/heneghan-peng-on-moscow-museum-shortlist/
Pardon the comparative, but it evokes the imagery of the "Deep Thought" from the Hitchhikers Guide… despite the fact that the "Deep Thought" really was figurative, non-abstract non-geometric structure more resemblant of Henry Moore's sculptures… Or may be it mreminds me of a stack of old-fashioned disk drives for extinct computers… or an old stereo equipment 'tower'? ok, ok, I am stretching things here… But, of course, Moscow is no stranger to geometric juxtaposing in its own architectural heritage… and I like it... I can't quite decide why...


The "Deep Thought" was of course a computer that was created to come up with the Answer to The Ultimate Question of Life, the Universe, and Everything. And everything is a big theme for physics nowadays. Good thing that recently they got a glimpse of a piece of this 'everything'. Per BusinessInsider: "For the first time, astronomers were able to see a string of hot gas known as a filament that is thought to be part of the mysterious underlying structure that dictates the layout of all the stars and galaxies in our universe. Scientists believe that matter in the universe is arranged into a gigantic web-like structure. This is called the cosmic web." Read more: http://www.businessinsider.com/first-image-of-cosmic-web-2014-1#ixzz2s5048t46

The whole thing relates to the eXtreme Deep Field view of the Universe, which is covered in all its glory here: http://www.nasa.gov/mission_pages/hubble/science/xdf.html

Do note that none of this disputes that the answer to the Ultimate Question of Life, the Universe, and Everything is, as found by the Depp Thought, 42. Nor does it provide any insight into Deep Thought's last conjecture that "…the problem, to be quite honest with you is that you've never actually known what the question was". But it is fascinating, nonetheless. 

1/2/2014: US GDP growth Q4 2013


US Q4 GDP numbers posted a surprisingly strong performance, with third quarter in the row coming at above the 2009-2013 average rates:

Source: Pictet

At the top level, GDP posted 3.2% q/q expansion and annual (y/y) growth accelerated from 1.3% to 2.0% to 2.7% between Q1 and Q4 2013.

The quality of growth also improved. In Q2-Q3 2013, personal consumption grew 1.8% and 2.0% respectively (annualised), with Q4 2013 growth registering 3.3%. Private final demand grew 4.0% in Q4 2013, against 3.4% and 2.8% in Q2 and Q3. Bad news came only on private residential investment side, where activity declined massive 9.8% having posted  14.2% and 10.3% expansions in Q2 and Q3.

Government spending fell 4.9% in Q4 2013, compared to decline of 0.4% in Q2 2013 and growth of 0.4% in Q3 2013.

Excluding Government spending, GDP grew 5.2% in Q4 2013, beating 5.0% growth in Q3 2013 and 3.2% growth in Q2 2013.