A number of readers are sending in links to a video from the Fortune Brainstorm Tech conference last month, in which Lawrence Lessig recounts a conversation over dinner with Richard Clarke, the former government counter-terrorism czar. Remembering that the Patriot Act was dropped on Congress just 20 days after 9/11 — the Department of Justice had had it sitting in a drawer for years — Lessig asked Clarke if DoJ had a similar proposed law, an “i-Patriot Act,” to drop in the event of a “cyber-9/11.” Clarke responded, “Of course they do. And Vint Cerf won’t like it.” Lessig’s anecdote begins at about 4:30 in the video.

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Filed under: Consumer experience, Economic data, Housing, Recession

Now that analysts have figured out that the credit crisis is moving from subprime to prime borrowers, the economic detective squad has begun to look for what’s next. Turns out they don’t have to look much further than the same consumer who can’t afford his mortgage.

According to The Wall Street Journal, “Rising defaults on credit-card payments, coupled with a bleaker economic outlook, are spooking investors in the market where this debt is packaged and sold.” The result is a double-edged blade. Banks that hold these packaged securities will have to begin to write them down just as they did mortgage-backed paper. And consumers will find credit harder to come by because banks do not want more write-offs.

The consumer will have lost one of his last places to find cash, and banks will face more losses and the risk of having to raise additional capital. Since credit has driven consumer spending, the retail industry might be in for another shock.

The other part of the credit market that is headed toward the toilet is home equity loans. It has the same risks for banks that mortgages do. It has the same effect on consumers. They can’t tap something which no longer has value to get more cash.

All of this is to state that whatever hope the economy and banks had of recovering this year is gone. Even the first part of 2009 might be a mess. The dominoes are falling that way.

Douglas A. McIntyre is an editor at 24/7 Wall St.

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Strike threat may delay SPL begin - BBC Sport
The begin of the Scottish Premier League this weekend could be delayed because of a strike threat from the country’s Referees’ Association (SRA). The SPL is meeting the SRA at Hampden Park on Tuesday in an attempt to resolve a pay row, with the

With video: New Obama ad hits McCain - Detroit Free Press
Democrat Barack Obama’s presidential campaign aired a new Television ad in Michigan and some other states Monday to coincide with his energy speech in Lansing. Unlike some other ads, this one is a direct attack on Republican candidate John McCain. Images: It

Seven Summits Research Releases Alerts on AAPL, COP, QCOM, AKS, and - MSN MoneyCentral
AK Steel Holding Corp ( AKS ) Stock Quote , Chart , News , Add to Watchlist http://www.iotogo.com/s/080508A (Note: You may have to copy this link into your browser then press the [ENTER] key.) Today’s PriceWatch Alerts cover the following stocks

Princess’ Diana’s Gowns on View to Help Charity - The Ledger
Maureen Rorech, owner of 13 of Diana’s gowns, signs a copy of her book “My Decade With Diana.” With the assistance of the Smithsonian Institution, a 5,600-square-foot traveling exhibit was fabricated to bring the legacy of the late Diana, Princess of

News Corp., investor raise offer for rest of NDS - CNN Money
NEW YORK (Associated Press) - News Corp. and a private equity firm have raised their offer to buy out public shareholders of News Corp.’s publicly traded subsidiary NDS Group PLC. News Corp. and funds advised by Permira Advisers LLP raised their

Seven Summits Research Releases Alerts on BAC, EBAY, PTEN, SPWR, and - MSN MoneyCentral
eBay Inc ( EBAY ) Stock Quote , Chart , News , Add to Watchlist http://www.iotogo.com/s/080508B (Note: You might have to copy this link into your browser then press the [ENTER] key.) Today’s PriceWatch Alerts cover the following stocks: Bank of America

Poor Oversight Squanders Medicare Money - Redorbit.com
Congressional investigators state the government is squandering millions of dollars by approving the fictitious sellers of wheelchairs, prosthetics and other medical supplies to submit reimbursement claims with only limited review. The Government

MPs face ban over jobs for children - Crewe Guardian
MPs are to be banned from employing their children using taxpayers’ money under new Government proposals. The move follows recent uproar over abuses of Parliamentary allowances and the publicly-funded jobs occupied by MPs’ relatives. But they will be

In the News - Opensecrets.org
Put John McCain’s name into Google, and you’ll see millions of hits that the Republican nominee will likely never see himself. He won’t be spending any money on a Blackberry anytime soon, but that doesn’t mean technology companies aren’t spending any

Finicity Pairs Mvelopes Money Management with Online Community and - Businesswire.com
SALT LAKE CITY–( BUSINESS WIRE )– James Ooltewah almost became a statistic to what experts state is the leading cause of divorce – fighting over finances. He and his wife amassed a big amount of credit card debt early in their marriage, leading

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PizzaFace writes “The Washington Post reports on the booming business of selling your medical treatment records. Today these are mainly records of your prescriptions, but the data warehouses will soon have records of your lab tests, too. The companies selling these records make it easy for insurance companies to avoid risk by assigning each person a health score, similar to a credit score, or by flagging items in each person’s history that suggest chronic or potentially high-priced health problems. It’s not just for insurers, either; employers who check applicants’ credit scores will surely be interested in their health scores as well.”

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Filed under: International markets, Forecasts, Bad news, Products and services, Management, Competitive strategy, Employees, Japan, Economic data, Workspace, Oil

Over the past year, automakers have struggled to deal with the tough economic conditions in North America, especially the United Says. One of the companies that has been able to handle the slowdown better than its peers has been Toyota (NYSE: TM). But the effects are being felt even by the Japanese automaker, as made clear today in the news that the company is laying off 800 workers in one of its Japanese plants.

The 800 workers that are being laid off represent about 10% of the workforce at the company’s plant in southwestern Japan. So far, the company has been able to sidestep the steep losses that its American rivals have been forced to deal with, but this year is proving to be a bit tougher, as the company is now predicting a first annual drop in profit, which would be the first time in the past seven years that the company has seen profit fall.

Toyota has been more fortunate than many automakers, mostly due the fact that the company has a long history of building smaller, more fuel efficient automobiles. This fact alone has helped it weather the slowdown that record high gasoline prices in the U.S. have helped create. Last Friday, however, the company stated that sales dropped 18.7% in July from the same period last year.

But even as strong as Toyota has been, this year is going to be hard on the Japanese automaker, and the predicted drop in profit has led the company to reduce the number of cars that it plans to produce, thus leading to these 800 layoffs. Of the 800 layoffs, 350 were cut in June, and another 450 got the news last month.

Toyota did say that it plans to increase the number of jobs again towards the end of this year, as the company tries to figure out a new production level to fit the current market. The plant where these current layoffs took place produced around 430,000 automobiles, including models such as the Lexus RX and Highlander sport utility automobiles.

When the company raises employees levels later this year, expect the added resources to be used more in factories that produce the company’s most fuel efficient cars. This is an area where Toyota excels but has been having a hard time keeping up with the fierce demand for these cars.

Michael Fowlkes has worked as a stock trader for seven years and spent the last four years working as an analyst for the on the web investment advisory service Investor’s Observer.

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An anonymous reader sends along a link to a mindbending article in Science News on quasicrystals — odd materials with a structure partway between order and disorder. Now researchers have found something even odder: a material that’s partway between a quasicrystal and a regular crystal. The order in the new structure is provided by the Fibonacci sequence. It was constructed with plastic beads and laser beams, so no new materials science inventions are on the horizon. “‘We are absolutely sure that this structure should have properties that are not common,’ Mikhael says, because materials with odd structures nearly always do. Now they just have to figure out what those properties are.”

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leighklotz writes “In an update to the tiny green men story of not-life-on-Mars, NASA has twittered: ‘The buzz this weekend was due to an interesting soil chemistry finding, still preliminary, but now avail here:’ where ‘here’ is NASA Spacecraft Examining Martian Soil Data. The exciting bit: ‘Within the last month, two samples have been examined by the Wet Chemistry Lab of the spacecraft’s Microscopy, Electrochemistry, and Conductivity Analyzer, or MECA, suggesting one of the soil constituents might be perchlorate, a highly oxidizing substance.’ Also, ‘NASA will hold a media teleconference on Tuesday, Aug. 5, at 2 p.m. EDT, to discuss these current science activities.’”

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