Ace905 writes “For years the razor-sharp beak that squid use to eat their prey have posed a puzzle to scientists. Squid are soft and fragile, but have a beak as dense as rock and sharp enough to break through hard shells. Scientists have long wondered why the beak doesn’t injure the squid itself as is uses it. New research has just been published in the the journal Science that explains the phenomenon. One of the researchers described the squid beak as ‘like placing an X-Acto blade in a block of fairly firm Jell-O and then trying to use it to chop celery.’ Careful examination shows that the beak is formed in a gradient of density, becoming harder towards the tip end. Understanding how to make such hardness gradients could revolutionize engineering anywhere that ‘interfaces between soft and hard materials [are required].’ One of the first applications researchers imagine is prosthetic limbs.”

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An anonymous reader tips us to a story up at Wired reporting on what might be the first computer attack to inflict physical harm on victims. Last Saturday, griefers posted hundreds of bogus messages on the support forums of the nonprofit Epilepsy Foundation that used JavaScript and strobing GIFs to trigger migraines and seizures in users. For about 3% of the 50 million epileptics worldwide, flashing lights and colors can trigger seizures. “‘I don’t fall over and convulse, but it hurts,’ states [an IT worker in Ohio]. ‘I was on the phone when it happened, and I couldn’t move and couldn’t speak.’ … Circumstantial evidence suggests the attack was the work of members of Anonymous, an informal collective of griefers best known for their recent war on the Church of Scientology. The first flurry of posts on the epilepsy forum referenced the site EBaumsWorld, which is much hated by Anonymous. And forum members claim they found a message board thread — since deleted — planning the attack at 7chan.org, a group stronghold.”

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Filed under: Rumors, Management, Newspapers, Rants and raves, Scandals, JPMorgan Chase (JPM), Housing

Jeff Manning, staff writer for The Oregonian newspaper, released a story Thursday, March 27, 2008, that claims the paper has come into possession of a copy of an internal memo from JP Morgan Chase (NYSE: JPM). According to The Oregonian article, which hints at unsavory or even fraudulent mortgage processing practices, the memo indicates that loan processors can (not should) use creative data entry to modify automated underwriting system results. The Oregonian writer entertains the “dark side” scenario in the tone of his article.That’s a real convenient, time-tested ploy for selling newspapers. Kudos for his attempt.

However, representatives for Chase mortgage operations have dismissed the memo as nothing more than a strategic angle on automated process. While no one has actually come out to say they created the memo or why, the company allegedly admits that the document is genuine. I get no sense that anyone from the company who commented on the situation has anything to hide. In fact, company reps appear to be quite forthcoming on the matter.

Let’s get one thing straight here, banks have a right, or even an obligation, to review every lending situation from a multitude of angles and perspectives. Automated underwriting programs assist in that process. If in fact, loan screening associates at Chase were instructed in the ways to “tweak” their system to produce differing results, it can safely be assumed that it was for the benefit of borrowers who are continually seeking personally convenient options to make mortgage contracts on homes of insanely inflated value. Nowhere have I seen an accusation that Chase forwarded mortgage papers based on fraudulently manipulated data. If someone has documentation of fraudulent practices that they have the ability to substantiate, I’d really like to see them.

In the meantime, I think The Oregonian should stick to reporting on flower shows and high school choir productions, areas at which I believe it is particularly adept. For it to publicize sensationalist speculation based on a memo of “Zippy Cheats and Tricks” is simply fifth-page fodder for the grist mill, nothing more. The entire situation comes right back to one particularly stinging realization, and I’ll remind you of that reality in case you don’t get it yet:

People who take adjustable rate mortgages in the face of mortgage rate low ebb and unsupportable home values are just plain dumb. When interest rates subsequently increase and they then get burned, the only hand they should be slapping is the one that signed the contract. I am oh so exhausted of listening to whiners trying to blame their thoughtless choices on those who were willing to underwrite their risk-taking ventures. If they made a bad gamble and now they’re on the rocks, they have the ability to just cry me a huge blue river and get a second job.

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Filed under: Housing

Yesterday I received a great comment from long-time reader Dr. Michael Schneider of barrelomoney.com. He wrote:

Each market has buyers and sellers– so far it seems the remedies for the housing mess have been directed at helping the banks and homeowners (sellers) and, rightly or wrongly, propping up housing prices. This has the effect of helping those who created the mess or who profited from it while possibly hurting potential buyers– including 1st time home-buyers who might have to pay higher prices for homes that may still be overpriced.

This might seem like fairly obvious point but it has profound ramifications: it’s been totally missed by the people who are supposedly working to solve these problems. Propping up home prices delays the inevitable reversion to something resembling intrinsic value, and prices first time home buyers out of the market.

This was one of the effects of the subprime bubble as well: lax lending prices that made homes available to people with brand new SUVs and double-digit FICO scores made it difficult for people who wanted to do it the right way: work hard, save money, and make a 20% down payment on an affordable home with a 30-year fixed mortgage.

When you consider it like that, you have to wonder why there is so much resistance by supposedly reasonable politicians to just letting the darn prices come back down to earth: it’s a zero-sum game, and lower home prices will help just as many people as they hurt.

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dooling writes “In case you were thinking of building your own atom bomb, you may want to weigh your intellectual property liability. It seems there are over 2000 patents covering the atom bomb. To avoid publishing the patents, a central tenet of the patent system, “the project made use of an obscure law whereby patent applications could be filed but no one would actually look at them or evaluate them. They would just be stamped secret and stored in a vault at the patent office.” The irony here is that while all the patents were essentially stored in the same place at the patent office and written to be understandable by any engineer, the Manhattan Project worked diligently to compartmentalize knowledge, using code names for just about all aspects of the project and keeping tight security on all information. It seems the patents were filed to give the U.S. government an essential monopoly on the burgeoning nuclear industry and protect it against others who might patent similar technologies later.”

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Filed under: Industry, Housing

During summer and winter breaks from college, I used to work in a Williams-Sonoma, Inc (NYSE: WSM) store in my local mall. As a moderately eloquent speaker and the only guy in the joint, I managed to make quite a few sales, particularly among the key “25-40 year old, vaguely unsatisfied married female” demographic that made up most of the store’s customers. One day, as my father waited for me to get off work, he watched me talk a wealthy, sour-faced housewife into buying a $49 grape drainer. Shaking his head at my salesmanship, he wondered aloud how I could convince someone to shell out a pocketful of cash for what was essentially a porcelain bowl with holes in the bottom. I couldn’t really answer him and, to today, I wonder how Williams-Sonoma manages to market its wares, many of which are amazingly useless.

In the fourth quarter of 2007, Williams-Sonoma’s profit rose almost 3%, but its first-quarter same-store 2008 profits are expected to fall by between 6% and 8.5%. The store is blaming its flagging sales on the real-estate slump. While it seems reasonable to anticipate that people would be disinclined to purchase home goods when they’re having a hard time covering their mortgage payments, Williams-Sonoma is missing the large picture. In addition to its position as a major player in the home decor market, W-S is also a luxury brand store and a narrow-focus mall retailer. Both of these types of stores are facing serious problems in the current economy, one for its inflated prices and the other for its lack of diversity. Consumers looking for kitchen implements are probably inclined to go to Lechters, which is a lot cheaper, or Wal-Mart and Target, both of which have a much wider selection of merchandise. If Williams-Sonoma wants to weather this storm, it should probably follow the lead of its Pottery Barn subsidiary and begin cutting its prices. In the current economy, it’s hard to imagine someone shelling out $49 for a grape drainer!

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Filed under: Industry, Housing

During summer and winter breaks from college, I used to work in a Williams-Sonoma, Inc (NYSE: WSM) store in my local mall. As a moderately eloquent speaker and the only guy in the joint, I managed to make quite a few sales, particularly among the key “25-40 year old, vaguely unsatisfied married female” demographic that made up most of the store’s customers. One day, as my father waited for me to get off work, he watched me talk a wealthy, sour-faced housewife into buying a $49 grape drainer. Shaking his head at my salesmanship, he wondered aloud how I could convince someone to shell out a pocketful of cash for what was essentially a porcelain bowl with holes in the bottom. I couldn’t really answer him and, to this day, I wonder how Williams-Sonoma manages to market its wares, many of which are amazingly useless.

In the fourth quarter of 2007, Williams-Sonoma’s profit rose almost 3%, but its first-quarter same-store 2008 profits are expected to fall by between 6% and 8.5%. The store is blaming its flagging sales on the real-estate slump. While it seems reasonable to anticipate that people would be disinclined to buy home goods when they’re having a hard time covering their mortgage payments, Williams-Sonoma is missing the massive picture. In addition to its position as a major player in the home decor market, W-S is also a luxury brand store and a narrow-focus mall retailer. Both of these types of stores are facing serious problems in the current economy, one for its inflated prices and the other for its lack of diversity. Consumers looking for kitchen implements are probably inclined to go to Lechters, which is a lot cheaper, or Wal-Mart and Target, both of which have a much wider selection of merchandise. If Williams-Sonoma wants to weather this storm, it should probably follow the lead of its Pottery Barn subsidiary and begin slicing its prices. In the current economy, it’s hard to envision someone shelling out $49 for a grape drainer!

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Filed under: Politics, Presidential elections, Housing

At a speech in Manhattan yesterday, Senator Barack Obama blamed lax oversight and deregulation for the housing sector’s woes, saying that “Under Republican and Democratic administrations, we failed to guard against practices that all too often rewarded financial manipulation instead of productivity and sound business practices. The result has been a distorted market that creates bubbles instead of steady sustainable growth, a market that favors Wall Street over Main Street but ends up hurting both.”

He’s right about that — but his solution is to pump $30 billion into the system, in part to help bailout homeowners who were the beneficiary of overly aggressive mortgage lending.

His position makes no sense: If people were able to purchase homes because of a distorted market caused by lax oversight, doesn’t pumping in money to help them keep “their” homes just prolong the problem?

He also lashed out at Senator John McCain’s reasonable, consistent argument that we shouldn’t be bailing out any of these people. Free markets got us into this mess, and free markets should get us out. Obama stated that “While this is consistent with Mr. McCain’s determination to run for George Bush’s third term,m it won’t help families who are suffering.”

Here’s the problem: these families that are suffering with making mortgage payments were the beneficiary of lax lending practices and poor oversight! By bashing the industry/regulators but insisting that people should be given help in keeping their homes, Obama is trying to have it both ways.

But in an election year, that might be the best way to approach it. The Republicans are trying to have it both ways too, supporting plans to help financial institutions avoid paying the piper for years of bad decisions.

The Democrats want to help out homeowners and the Republicans want to help out banks. The right thing to do is to help no one, and let them fix the mess they started themselves.

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Nature is reporting that a new distributed computing application is looking to monitor earthquake data using the accelerometer in many computing devices. In the long run, “Quake-Catcher” will hopefully be fast enough to give warning before major earthquakes. “If it works, it will be the cheapest seismic network on the planet and could operate in any country. It wouldn’t be as sensitive as traditional networks of seismometers, but Lawrence says that’s not the point. ‘If you’ve only two sensors in an area, you’ve to have a perfect system. If you’ve 15 sensors in a system it [can] be less perfect. One hundred, one thousand, ten thousand — your need for the system to be perfect becomes much smaller,’ he says. ‘That’s really our approach — just to have large numbers.’”

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BoringNitride writes “Nanotech tool vendors hawked their wares to innovative engineers at the spring meeting of the Materials Research Society this week at San Francisco’s Moscone Center. Wired took a break from presentations on molecular motors and the mechanical properties of human skin to take a walk across the showroom floor. They captured close-ups of some of the most precise molecule-building and measurement tools in the world.”

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