2008 Financial Meltdown Imminent?

As 2007 comes to a close, I can't help wondering what 2008 has in store for us all from an economic standpoint. Should I make a 2008 economy prediction now? Sure, why not,... the "experts" seem to make plenty of forecasts, prognostications, best-guesses, predictions, or whatever else you may want to call them, so I will release my 2008 Financial Meltdown Prediction now.

The way I see it, the only thing that could prevent a mass collapse of our existing financial system at this point is (as nearly always is the case) a large-scale intervention by the Federal Reserve / Government to create yet another "bubble" in yet another sector of the economy with hopes of a newly inflating bubble saving us from one that is currently popping (i.e., the housing bubble). You wait, and watch, and you will see I am right. It is going to take something large (hopefully not a massive war) to seriously change my forecast.

Some things that point to an imminent and impending financial / economic collapse:

• In general, the house of cards (debt-masked artificial "growth" and GDP) known as our "economy" is finally nearing a tipping point. Remove consumer-debt-financed "growth" and government deficit-spending from the equation, and I posit that there is ZERO true economic growth (negative in fact; as it has been for years, though heavily disguised).
• The fact that basically nothing is made here anymore is partly to blame for things. All our money is flowing outward, and at a record pace.
  
• Year-over-year real-estate numbers. These are down about 7% nationwide, which results in over $1-Trillion in lost "equity" / paper-value of all homes in the USA. This was a historical record correction, and, I think we are only at the cusp of what is to come.
  
• Credit-card late-payments are up FIFTY PERCENT yr-over-yr. People are right on the edge of total collapse. Complete delinquencies are also soaring - accounts that have no hope of ever being paid back.
  
• Large companies are showing signs of desperation, borrowing massive amounts of cash from (and losing equity to) foreign investors (like Citigroup's $7.5BillionMiddle-East Abu-Dabi bailout deal, Merrill Lynch's $6.2BB bailout by a Singapore-owned state investment firm, Morgan Stanley selling a 9.9% stake to the Chinese government for emergency financing / bail-out... the list goes on!
• Rising unemployment, which, mark my words, is going to really take off in early 2008. I would bet a substantial sum that massive, widespread corporate layoffs are going to emerge early in 2008 just after the holidays. This seems to be the only way companies can ever come up with to "increase profitability", since management can not otherwise figure out how to differentiate their business from a competitor's and gain market share or improve products and services to increase profits. And, if there is work that still needs done, don't worry -- they'll just use foreign labor and outsource even more than already.
  
• Our "volatile food and energy" inflation is out of control, primarily due to competition for food sources from energy concerns (i.e., ethanol production). It's bad enough energy prices are hitting people's wallets, but it takes pure insanity for a country to compete with its food resources to make fuel (regardless of how much farmers may currently be enjoying this windfall). Don't think it is just corn that is going up. Wheat is up 50%+ in the past year, as are many commodities. And, this has hit grocery bills hard, further pinching the consumer.
  

What has lead to this?
Housing was a bubble created to bail us out of the technology stocks speculation / bubble before it. People seemed to overwhelmingly believe that, once again, a certain sector of the economy could turn in "growth" indicators month after month, year after year, that were so completely out of line with overall long-term GDP growth that it should have been obvious there was a speculative bubble in motion again. But, even the "experts" (which there seems to be no shortage of), continually preached how this was "different" and sustainable, and so on, spewing forth (abused) statistics to back their opinion of why housing was such a great investment.

Contrary to all the analysis and observations by mainstream "economists", I think there is a very simple method for detecting such over-speculation, hype, "froth" (a Greenspan term), lunacy (my term), and so on when it comes to sectors of the economy / market being on fire. Do you want to know how to detect a bubble, and do so in time to avoid getting caught in a downturn like the one we are currently seeing with housing?

Spotting Bubbles Early...
One way I suggest to get advance insight into the formation, expansion, and impending collapse of "bubbles" is to look at Google-Ads (and other online ad mechanisms) to spot market "hot spots". What am I talking about? Well, any time there is the lure of easy money through speculation, and likely areas of exploitation (and even fraud), like some of the business practices that were driving the housing bubble, you will see over enthusiasm and willingness for individuals and companies to pay a very high per-click price for keyword-specific online advertising.

When I heard from a friend a couple years ago who claimed he was making (his cut) as much as $5, $10, or even $20 per CLICK on website ads for mortgage refinancing, home sales, etc., I knew the market was ready to implode! Those rates would imply that people were spending perhaps as much as $50/click to show an ad on websites! The only reason anyone would be willing to spend such amounts on a gamble that the person clicking would then perhaps actually buy their service / product, is if there was some extremely lucrative opportunity to exploit a short-term bubble and cash-in on the craze that was sweeping the country (adjustable rate loans, no-money-down mortgages, and so on). Their was so much profit potential to be had be selling these "financial vehicles" that people were willing to essentially gamble with Google Ads and the like just to get people to their websites.

I had some money in Nuveen Real Estate Income Fund (Public, AMEX:JRS) ETF at the time, and as soon as I started looking into these insane per-click prices, and read all about the rate of supposed per-day house-price increases in places like Orange County, CA (yep, per day -- I read articles about houses going up faster than what a person could make working in a day), I knew it was time to get out. And, I did. I sold before that particular real estate stock fund peaked, but also before it fell nearly 50% to it's current price. I am quite glad I ditched out in time!

What about Economists and their Forecasts?
This leads me to why I consider most economists useless, since as a group, they are nearly always led down the same path as the rest of the population and are nothing more than reactionary. Sure, a select few saw the bubble for what it was, but somehow market analysts, economists, forecasters, and the like as a whole didn't see the bubble for what it was (or, if they did, they were not the ones getting any air-time on TV). They are reactionary in general, and rarely seem to spot useful trends in time.

This continues now. Today I saw this Dow Jones Reuters report, and excerpt which I quote here:

Total applications for U.S. jobless benefits unexpectedly rose by 1,000 last week, while the number of longer-term unemployed rose to its highest in more than two years, the government said on Thursday.

What immediately gets me is the single word: UNEXPECTEDLY. These economists are out of touch. Who, in their right mind, would not expect unemployment to rise when the housing market is imploding, corporate credit-issues abound, the consumer is tapped-out as a whole, and so on?

Given this level of mainstream economists' ability (to forecast), I don't have much confidence in their ability to see how bad things truly are right now. Or, do they all see it and are just not allowed to say it in the public forum? Sure, there are a few small signs of hope within the economy, but I don't think they outweigh the multitude of issues facing our financial system right now.

Presidential Election 2008
Answer this question: why does anyone want to be President in 2008, and inherit this economic catastrophe-waiting-to-happen? Surely whoever is elected will have to deal with a general economic downturn in 2008, a continued weak housing market (if not downright terrible one), a banking system in distress, and more. I go back to my general line of thinking, which is, there must be some really lucrative and long-lasting benefits to being President for someone to want that position badly enough to spend millions to get it. Reminds me of the insane per-click price for advertisements I mentioned earlier.

People definitely expect to get back a LOT more than they put in, whether those people are the candidates or the people (and companies) backing them. How does this fit into my blog today? Well, I ultimately blame this type of behavior for the looming economic crisis we're facing now. Short-term profit motivation is outweighing common-sense, and the consequences of the quick-money mentality are going to catch up to us all.

Business Gift Tax Deduction - $25 per person

Don't miss the chance to write off business gifts...
The 2007 business gift deduction is something many business owners will accidentally overlook this time of year. You still have a few days left, and you can give a (small, $25.00 maximum value) tax-deductible yearly business gift to your client contacts and any employees.

I am not an accountant, and can't give legal or tax law advice, but it seems the law for business gifts and taxes is all about making sure you are giving a gift with the intention of receiving some value in return. It makes sense that you would give gifts to clients or prospects in hopes of landing more business in the future, and the IRS will gladly take their cut of any future profits that directly or indirectly arise from this act of kindness you show your business contacts. Likewise, gifts to your employees are deductible (to that $25 limit) since it is assumed your employees will return that much "value" to you for this expression of gratitude for work well done.

Gifts to Contractors, Gifts to Suppliers, etc...
I have not been able to find specific tax law wording regarding contractors you have on staff -- and perhaps other people that help you with your business (e.g., your accountant, lawyer, and perhaps others you feel would return additional business "value" after building a more friendly working arrangement), but it seems logical that you could.

Worst case is you would have to fight for your right (with the IRS) to attempt to minimize costs for your business, over a maximum of $10.00 lost in tax revenue off the $25.00 gift you gave to a supplier in hopes they would perhaps not charge you when you call them with a simple question, etc.

If you save on expenses, your business profit increases, and you pay more tax, right? So, if an act of kindness saved you even a percent or two when negotiating the best-price with your supplier for paper or office supplies or contracted services, it wouldn't take much at all to offset that tiny little gift-expense in terms of taxable profit / income later.

Once again, I am not tax expert, or accountant, but it seems like you could defend this position (logically at least - - god knows logic rarely plays into tax law though). Consult your accountant for details.

This insane, eternal, low, $25.00 limit!
The dark side of this gift tax deduction for businesses is how lame the limit is! Although it is nice that you can write-off some small items that may garner a bit of extra favor with clients and employees, I still find it reprehensible that the IRS has not raised the $25.00 limit in decades! Sure, they want to avoid rampant fraud and abuse and not lose revenue if they can avoid it, but come on guys, how about a $50.00 limit by now (though, I think $100 limit would make more sense, especially if they go back to not increasing with inflation for another decade or more).

I always try to get some little things for clients and employees every year, since it is a write-off. But, TWENTY-FIVE BUCKS!!? This has not changed in DECADES! Talk about a hidden tax increase! (since, no inflation adjustment factors are in place).

You can't buy anything TOO NICE for twenty-five dollars! So, tell your employees, "here you go -- great job!... sorry, I could only get your something simple and cheap. But thank god for those cheap Chinese imports, since it is the only way I could keep up with inflation!" LOL

At the same time, we recently cut capital-gains rates in half for even billionaires, and GWB whines on TV about how the "death tax" (formerly, pre-propaganda times known as an "Estate Tax") needs permanently removed and the capital gains tax cut needs to be permanent. It says something about our tax-law and who benefits from the larger and highly publicized changes to it, when the IRS worries about $7.00 or so tax revenue per gift, that would grow to perhaps $15/gift lost if they doubled the write-off to $50.00 maximum gift deduction, while at the same time we extend the biggest tax cuts in history to the top income brackets.

So, given the priorities of our Congress and Leaders, chances are nearly certain that the 2008 business gift tax deduction and 2009 business gift tax deduction, etc., will remain subject to the same paltry $25.00 limit. But, take what scraps they give you... you never know when they'll decide to take away this little deduction to balance another handout to a more preferred cause.

Note: if you want to read more detailed insight into this topic of giving tax-deductible business gifts, Microsoft Small Business had this article online about giving a business gift and getting a write-off, that goes into much more of the specifics behind the tax-law.

Also, consider a year-end company party...
If you have food expenses for a company party or for office snacks or meals, those expenses could be fully deductible (instead of the normal 50% deductibility for standard meal and entertainment expenses). So, if you want to buy some "good will" near the end of the year, buy lunch for the office staff and/or have snacks available or throw a nice party. It's a no-brainer for raising workforce morale while you get the full benefit of a tax write-off.

Likewise, you may want to take the opportunity to promote your products and services to the public. If your company is providing food to the public for free as part of a promotional campaign, those costs could also be fully deductible / expensed (100% vs. M&E 50% rule)

Environmental Impact of Larger-Diameter Car Tires

A recent trend I see that makes me even more conscious of our race to destroy the planet is this push towards large diameter car wheels and tires. Did you know that, counter-intuitively, a larger-diameter tire that has more surface area to wear down, actually nearly always wears more quickly than a smaller diameter tire?

Just go to a car dealer and ask them how many miles to expect out of those bigger and fancier 18" tires, and then ask the same question as applied to the same model car but with smaller (less "premium" / "sporty") tires. Or, go to a place like Tire Rack dotcom (which I highly recommend for great deals on tires), and just check out the wear ratings on the various size tires. I can pretty much guarantee the smaller tire is going to last longer. And, to top it off, the smaller tires are cheaper (conversely, the larger tires that are going to wear faster are more expensive)

So, not only do the larger tires wear faster, but the also cost more - talk about a double whammy to the pocket book! I recently saw a new 2008 Honda Accord Coupe in its "top of the line" configuration, which sported snazzy 18" low-profile sporty 235/45VR18 tires. I asked how many miles to expect out of a set -- "about 20,000" I was told. Eeek! Only 20K miles! Wow, what happened to the days where a Honda Accord was a family car that sported 15" tires capable of 50,000 miles between changes? And, these new 18-inch Michelin Pilot HX MXM4's are going to set you back at least $255 each (that's the discount Tire Rack Price too)! (read: over $1,000 just for a set of new tires that you may be putting on your car once ever year or two with "normal"-mileage driving habits).

Sure, like anyone with a sense for visual appeal, I can appreciate how fantastic these large wheels and tires look on something as sharp as the new 2008 Honda Accord Coupe, but what I can't understand is who wants to spend this much money on their tires regularly. And, I have yet to get to the environmental-impact side of the equation. Honda sells this car as something like a near-zero-emissions vehicle. Well, perhaps so (with regards to what comes out of the tailpipe), but what about all that (quickly) spent rubber that ends up polluting the environment? Oh, and "rubber" tires require a lot of OIL in their production. But, what's a little more oil consumption these days as oil reaches a record $100/barrel?

By the way, I don't want to seem like I'm picking on just Honda here. Fact is, after this little Honda experience, I went shopping around to see what all the various new cars sported for tires these days. Over and over, regardless of automobile brand, I was confronted with "base" models that had at least 16" tires on them, and quite often larger (even a little Scion Tc has 17" wheels by default now!). When asked why all the wheel options (which, never include downsizing, but nearly always include upsizing) are the way they are, some dealers say it is "customer demand", but others indicated that they believe tire manufactures have essentially worked deals with the car companies to push these larger, quicker-wearing, more expensive tires (gee, I wonder why!?).

If you are under 25 years old, perhaps you are not even aware of the day of 13" diameter rims on the small economy cars like the Ford Escort, and how these tires would last "forever" (certainly by modern terms). I'm not saying we need 13" tires on all cars or anything, but we really need to look at the impact that decisions like selecting the biggest wheels and tires possible for our automobiles can have on the envirionment. If you want some light reading on the matter, check out this 2004 USGS article on Tire Wear as a source of Zinc (pollution) to the Environment - it has all sorts of other neat tire-wear and pollution data in it too.

We can't just talk about making the environment cleaner, we need to have our actions reflect the essence of this talk. Car companies are advertising all over the place about going "green" and all, and I really think automobile manufacturers need to consider the tire side of the green equation too.

National Do-Not-Call Registry and permanent registration

For any of you who have signed up for the National Do-Not-Call Registry, especially those of you who signed up a few years ago already, you will be pleased to know that the FTC has pledged to not drop any numbers from the Do Not Call database pending final congressional lawmaker decisions about whether to simply make the don't call list "permanent" once you sign up.

This all sounds great, but my paranoid side has to wonder if this will ultimately turn out to be an orchestrated effort (pushed behind the scenes by telemarketing interests) to subvert the intentions of the do not call list through a tightly choreographed appearance of an attempt to make the list permanent, while the real objective is to have all of the names on that list that are reaching maturity (i.e., the existing 5-year limit) hold off on renewing their desire to remain unbothered by telemarketers as Congress "works on the issue", ultimately to have Congress not extend the 5-year period to permanence, and worse yet, do so with little notice and little press, effectively having all of us that are currently on the list "fall off" temporarily and subject ourselves to the harassment and calls we so want to avoid.

The real solution, and the obvious solution, to this do not call list is to make ALL phone numbers be automatically on the do-not-call list, and have it be an OPT-IN option to inform marketers that you actually want to receive calls from them (versus the current, and unbelievably lame, opt-out process that is nothing short of an obvious appeasement of telemarketing lobbying interests -- certainly not a consumer interest)! Of course, since the logical answer is to have all phone numbers be on a do not call list by default, that is one thing Congress will never require. So what if 76% of Americans have signed up to keep their numbers off the marketers' lists? (and, I presume most of the remaining 24% would do the same, but just don't take time or are not aware of how simple it is to do).

Let me start with a real-world example of how messed up the current do-not-call registration process-flow is, and what backs my presumption that Congress will, "after careful consideration" and so forth, not make the Do Not Call list a "permanent" thing. Recently my mother-in-law started receiving harassing calls in the middle of the night from some whacko that just happened to choose her number to call. Her existing number was on the do-no-call list, and she rarely received calls aside from the "exempted" stuff like "surveys" and political-campaign messages (gee, who would have guessed lawmakers would exclude themselves from being censored). After these harassing calls persisted for a few days, my mother in law decided to just have the phone company change her number.

Gee, guess what happens after changing your phone number? You are no longer on the do not call list, since it is an OPT-OUT (of being harassed by telemarketers) program vs. opt-in, and instantly you start getting bombarded with marketing calls, even if you go online and instantly register your new phone number with the FTC as not to be called, while the marketers have a sort of grace period to abuse you for a month or so. In my mother-in-law's situation, she went from rarely getting any calls, to literally turning off her ringer after a day because so many marketers were calling her. The phone companies obviously have financially-rewarding agreements with telemarketing firms to sell any information about new phone numbers ASAP so you can be abused and harassed "legally" for as long as possible. This is pure bull@#$! Especially if you were already on the do not call list, and are forced into changing your phone number for any of a variety of reasons.

It would be really nice if Congress would wake up and do our (the people's) bidding and implement some logical consumer-protection laws, but it isn't going to happen as long as lobbyists can hand them more cash and incentives than we, the public, do. It's not good enough to get our votes, they need constant monetary incentive up there on Capitol Hill in order to hear us it seems. So, don't be surprised when the "permanent registration" being considered in Congress somehow doesn't come to be (though, I sure hope it does!), and you suddenly start getting marketing calls during a period where marketers will exploit a giant hole created by Congress where your registrations lapses as an "unfortunate and unexpected side effect" of lawmakers efforts - since they'll postpone making a final decision until after many of us early signup persons pass our initial 5-years of peace we signed up for. I hope I'm wrong, but you can almost predict this sort of thing from lawmakers.

(NYSE:VMW) VMWare Converter 3 - Awesome Product!

I just finished using VMWare's Converter program (which, for the VMWare Converter Starter Edition, is FREE by the way) to quickly create a virtual-machine from a physical machine at a client site, and it worked flawlessly. The free VMWare's Converter 3.02 download (latest release version as of 10/18/2007), enabled me to create a completely software-based clone of a running physical web-server in only about 1/2 an hour, and copy the resulting two files (a VMX file, which is a text file with the virtual machine's configuration information; and a VMDK file, which is the VM's virtual-disk file) over to a notebook computer where I quickly verified the results using VMWare's other awesome (and FREE) product, VMWare Player 2.0 (dowload VMWare Player 2.0 here - latest version is VMWare Player 2.0.2 as of 10/18/2007).

I can't fully express how awesome these VMWare Products are, especially when used in conjunction to fully realize the synergistic power of software virtualization coupled with hardware / physical-machine conversion to a virtual entity. And, these are the free software products from VMware! VMware (NYSE:VMW) also has the more robust VMware Workstation 6.0 series, as well as other desktop and server-based hardware virtualization products targeting software developers, individuals, small business and enterprise applications.

In my personal use yesterday, I needed a way to take a company's live web-server off-line to test connectivity to a new DB machine and verify some new web-server code that was to be deployed soon, but I did not want to impact up-time to the customers which use the production web server around the clock. So, I installed the VMWare converter product on the live web-server (which didn't require a reboot or anything!) and proceeded to "convert" the physical machine to a Virtual Machine (the files mentioned previously, that run as a virtual computer using VMware Player or Workstation) without any reboots or downtime at all!

I copied the resulting VMware Converter output files (a single directory with the two files as noted above) to my notebook computer, and then used that virtual computer, running with VMware Player, to pre-test the new database-server-connectivity, a Windows 2003 Service Pack 2 install on the web-server (which, did in fact reveal an IIS change made by the Service Pack that would need to be quickly changed in production after applying the Service Pack), and a new COM+ component install and some ASPX (ASP DotNet) code. All of this testing was done with no interruption to the production web-server!

Having just pretested my implementation strategy using a virtual machine, I minimized the likelihood of any unforeseen delays and installation issues when working with the production web-server. In fact, I was able to provide my client with a quick estimate of down-time to expect to repeat the same thing in production - which, was likely not to exceed even one hour to do it all.

One thing I am pushing for at this particular client site is they go a step further and turn the production web-server into a virtual machine. Then, since no data is persisted on their web server machine (it's all stored in separate SQL Server 2005 on another firewall-secured server), I could simply take a copy of the web-server's virtual machine files when it needs updated, apply any updates and test them thoroughly, then reinstall the updated VM copy back into production, bringing down-time to as low as a couple minutes - hardly any more than a reboot of the web-server. For that, VMware workstation (a for-cost product, but extremely reasonable price of under $200!) will serve as my virtual-machine manager of choice on the physical server. and I will also consolidate another one of the client's web-sites to that same box as another VM.

Bottom line: virtualization products can be a huge time and expense saver, and VMware's products are the best out there from my personal experience. I can not emphasize enough how helpful these products can be in testing out deployment plans and scenarios BEFORE doing a full production upgrade or install. But yet, I continually encounter IT (information technology) people that have never even heard of the products, or have not tried them, or have said they can't justify the cost (uh, hello guys, these things are FREE for the most part, or quite reasonably priced). Instead, I have seen people waste countless hours (and dollars) working around NOT using virtualization software -- perhaps once upper company management and owners learns the full potential of virtual machine products, any resistance in the IT area will be met with an unwillingness to employ those with such resistance.

By the way, have you seen VMWare's stock price (NYSE:VMW) lately!? Last I looked, it now has a higher p/e multiple than Google. Some of this may be hype, but much of it is the realization that server consolidation (i.e., less physical hardware) and the resulting energy, equipment, and space savings is a huge way to save money! And, on top of this, the simplicity and flexibility of managing virtual machines (compared to physical ones) offers all sorts of savings potential - some of which I have described herein. Fact is, given how few IT people have yet to work with virtualization technology, there seems to be plenty of growth left in this industry. Check it out!

Ubuntu / Kubuntu Linux 7.10 Review - Fantastic!

I recently wrote an entry here on my technology blog about Windows Replacement with Linux, and specifically how I was looking forward, with great anticipation, to the final release of the Ubuntu and Kubuntu 7.10 Linux distributions. I have been watching the evolution of the Linux Desktop for years now, and have paid special attention to the standout distributions from Ubuntu and OpenSUSE, eagerly awaiting the day when I could declare a distribution fully capable of replacing the everyday Windows machine. Some have come close, but until now, no single distribution could completely claim the Windows-Replacement title.

In regards to the Ubuntu series, prior releases showed considerable promise, and with every step forward - versions 5.10, 6.04, 6.10, 7.04 (version numbers essentially being the year/month released) - there was steady progress towards Windows replacement, but always some important, and for me show stopping, features were still amiss. Version 7.10 promised the new features that would finally make the Linux desktop a viable alternative to Microsoft Windows, not just for recreational or part-time computing but also for an everyday corporate desktop environment.

I can now report that after reviewing the Final Ubuntu "Gutsy Gibbon" 7.10 release (in particular the KDE desktop flavored Kubuntu 7.10 distribution), a Windows desktop-replacement is finally here! Those critical features such as fully automatic printer installation, whose prior absence was enough to frustrate me to the point of not using Linux daily, are built into the product. The graphical-configuration tool for the X-windows environment is finally smart enough (i.e., properly designed and implemented) to allow me to alter my screen resolution without performing manual hacks to the xorg files, which I could not expect anyone in a corporate setting to do unless they happen to be a technology junkie!

Printing:
Printing is one of the most important operations from any desktop computing environment - period. Fact is, the promise of a paperless office has been nothing short of a dream, and paper hard-copy output still rules the land. As such, you need a quick a simple way to get connected to your printers (output devices) and put them to use. Ubuntu 7.10 finally made printing from Linux a breeze - even through a Windows 2003 Server shared-printer!

What I did for a test was not just print using a trivially simple setup such as a USB-Connected printer or other locally attached printer, but rather I printed to a Hewlett Packard (HP) Officejet Pro K550 Series printer that was setup as a shared printer installed on a Windows Server 2003 domain server on a TCP-IP network. Yes, a Windows domain shared printer accessible from Linux with ease!

This particular printer, in prior releases of the Linux desktop products, continually thwarted my progress and has become a nice test-case to evaluate the robustness of Linux distributions in regards to printing. With the new Kubuntu 7.10 printer-setup wizardry, I no longer had to do any sort of manual configuration, but rather I just walked through the steps presented to me in a series of graphical dialog boxes that made the process quite simple. I was prompted every step of the way and simply clicked my way through the process, aside from typing in the display-name/label of the printer, the Windows server name, the domain user and password to connect with, and the printer's network-share-name.

After just a few minutes, I was clicking the "print a test page" button, and getting a nice printout that says "Printer Test Page - Printed Using CUPS v1.1.x" featuring a color wheel and 1-degree radial lines test, plus information about imageable-area (that displays page size, print-resolution, and more) and printer interpreter-information (which showed my printer using PostScript Level 3 and GPL Ghostscript). Although this may not sound very exciting, it thrilled me with the simple fact that the Ubuntu 7.10 series product delivered, as promised, simple printer setup, and more importantly, allowed my evaluation of the potential Windows desktop replacement product to move forward - having proven itself in phase-I of my "absolutely essential functionality" tests. Great job Ubuntu team!


Display Adjustments:
In previous releases of Ubuntu, it seemed I was always finding it necessary to "hack" my display settings manually to get the system to recognize my preferred display configuration. I have a Dell Dimension 9150 machine sporting an NVidia GeForce 6800 adapter coupled to a Dell 24" 2405FPW (Digital) LCD flat-panel running at 1920x1200 resolution. This is my primary desktop setup of choice, and an absolute requirement for Linux to support.

I am pleased to report that the latest Kubuntu 7.10 delivered on the promise of a graphical configuration tool for "X" (X-Windows), which allowed me to quickly and simply change my resolution to the 1920x1200 setting and make use of my favorite LCD display device, all without hacking any xorg.conf files or whatever. Whew, what a relief! And, the Linux as a Windows replacement test goes a step further without any show-stopping issues... Excellent!


Microsoft Windows and Domain Connectivity:
Although a goal is to be able to replace the Microsoft Windows operating system (as the standard desktop operating system) with a "FREE" operating system, the fact is I will still need to connect to a Microsoft Windows Domain Controller / Server (especially Windows Server 2003), and other Windows desktops (generally Windows XP) , for the foreseeable future given the fact I write software that runs on these environments for my clients. So, needless to say, Windows network / machine connectivity is quite important.

It will probably come as no surprise that connectivity to Windows was quite simple to achieve - especially, if you noticed above in the discussion about printing how I connected successfully to a Windows network-share printer. Full read/write support to Windows is built-in. I used Konqueror (or was it Dolphin?) to browse my Windows Domain network using Samba, and easily authenticated to my file stores on Windows 2003. I was also delighted to be able to click on Windows Office documents (like Word docs and Excel spreadsheets) and have them open in their respective OpenOffice 2.3 equivalents. Oh, and the folder-browser showed neat little file-preview thumbnails of what was in the Word documents and Excel files before I even opened them -- most cool!


Conclusion:
This latest round of Linux distributions, in particular the Ubuntu and Kubuntu 7.10 releases, show all signs of being completely capable of a full Microsoft Windows desktop replacement operating system product. And, I think most common tasks, like setting up printers, changing display settings, and so forth, are now simple enough for an average user to perform. If you absolutely need access to Windows applications yet, you can always run Windows as a virtual machine on occasion from within Linux, but the more you use Linux, the less likely you'll be to "need" Windows.

After seeing the power and simplicity of this latest distribution release, I really don't know why so many people have never even tried Linux. Perhaps it has most to do with the fact that Microsoft has worked deals with nearly ever major manufacturer to include it with ever piece of PC hardware shipped, since otherwise if new computer buyers had to go out and choose an operating system (and actually pay for it separately), I have a feeling they'd quickly discover that not only can you save money on an OS, but also enjoy similar features, power, and flexibility without being tied to Microsoft forever. And, I haven't even discussed all the great free software that comes with these Linux distribution, or can be freely downloaded for use - there a many great products out there.

Hewlett Packard Rebate Fraud (alleged here!)

In the past year, I have been the victim of what I would best describe as organized and intentional rebate fraud by Hewlett Packard. I purchased two computer systems from them - first, a desktop system late in 2006 that came with (supposedly) nearly $300 in rebates PLUS a free Windows Vista upgrade. Next, I purchased an HP notebook computer a couple months ago that included a $50 rebate.

I should have known better than to purchase another HP product after the experience with the first one, but I thought that perhaps the rebate issues were isolated. In the first case, I did get a partial rebate, for about $100, for one of the system components that was to have a rebate with it. But, the remainder went unpaid even after I re-sent proof of purchase and sales-receipts to HP as instructed in a form-letter that arrived a couple months after purchase claiming that I had not included a detailed receipt (which, I clearly did, since Staples prints separate Rebate-Receipts to include with each product purchased that has a qualifying rebate program - and, I keep photocopies of exactly what I send - and yes, it was all there!).

In addition, this system came with a (supposed) free Microsoft Vista Upgrade when Vista was released, which it was soon after purchase. I immediately went to a website that HP provided for obtaining the "free upgrade", only to have the site repeatedly crash and never complete the process. Of course, HP had outsourced the fulfillment to a third party (I believe it was Unisys), who I contacted by email multiple times, and explained the problem -- they kept saying they "reset" the transaction, and that it should work now. Well, needless to say, it never did. After about 4 emails, they simply quit responding to me. Why should they? What do they care if you get your free upgrade?? They get paid by HP to implement this program, whether they do it right or not, and whether you get your free Software or not. And, Hewlett Packard (and other firms), in my best guess, intentionally push off fulfillment of such things so that you have absolutely no recourse. You contact HP - they say contact the third-party, the one that has no incentive to deliver. It's a win-win for HP, and a lose-lose for the customer. Lovely. I finally just gave up, since nobody would even answer my emails!

Most recently, just a couple months ago, I purchased an HP notebook that was to include a $50 rebate. I purchased it knowing that there was at least some chance I'd never see the rebate after my prior (though hopefully isolated) experience. Well, yesterday, I get the dreaded rebate-denial form in the mail, stating:

"We appreciate your purchase, but your submission for the Stand Up Stand Out $50 Pavilion Notebook Offer was declined for the following reason(s): Submission did not include a copy of an itemized dated sales receipt or packing slip. Please enclose a copy."

Yeah, right! I fully expected this type of crap! I made sure to check and double-check my mailing, and once again, I had dedicated "rebate-receipts" printed by the store at which I bought it. I sent everything asked for and highlighted all the pertinent info (the same info I'm once again being told I didn't send!) I called the included question-line at 1-888-385-5410, which of course went to some Indian call-center. Of course, it's not an HP employee you're talking to, and it's all about having some third-party handle the "customer experience". How do these companies stay in business (and, I'm not talking about the overseas call centers)?

So, I proceed to express my discontent at what I see as organized rebate fraud. I ask various questions to the call-center contact about whether they think HP is committing any sort of fraud. They can't say. They only tell me: "send the info in again, and I'm sure HP will pay", to which I said "yeah, I've been through that before, and they did not pay, so why should I?". The call center person checks the records and says "all you need to send is a copy of the sales receipt -- we have everything else". Once again, I've heard this before and done what I was instructed to do, only to not get paid - not to mention, I sent it once for god sakes, and it seems that only HP can't get me my rebates as promised and continually and conveniently loses the sales receipt I send!

What convinces me HP is perpetrating a rebate-scam!
So, I continue asking the offer-center contact questions, trying to figure out if there is a rebate scam going on here. I finally think I got the answer I expected when I asked, "OK, so can you tell me, are there a lot of other customers who are calling in to complain that although they sent all the required information, they are now being told HP didn't receive it" -- the Indian guy finally replies quite clearly, "yes, others are experiencing the same thing -- a lot of other people".

I can't help wondering if this is how Hewlett Packard's stock (ticker NYSE:HPQ) and financials are outperforming other personal computer and technology manufacturers. With margins as thin as they are in this field, a company could surely pump up their bottom line through an organized program of rebate-fulfillment dodging. Basically, make it as hard as possible for the consumer to get their rebate money... make it not even worth their time to pursue their rebate money... ship the "customer support" (call center) to India or wherever so that it is still much cheaper to field calls all day than to pay the rebates, and voila!, you have just pumped up your bottom line! The temptation must be huge, and corporate bonuses for upper management (performance based) must make it even more likely. Perhaps I've just had a round of bad luck with inept rebate fulfillment personnel, but I suspect the prior considerations dominate the rebate-processing food-chain in HP (and other firms - though, I've ONLY had problems with HP!)

Even if HP is hit with a class-action suit over this type of thing, I bet they have already calculated that it'll still be cheaper than to just pay the rebates. In the end, some lawyers will make a lot of cash, and the consumers will get some lame $50 coupon off future HP product purchases. Isn't this how these things typically pan out?

Did I mention the fact that I used to work for Hewlett Packard? I used to think they were the most upstanding and wonderful company around, with great corporate culture and customer rapport. A lot has changed in the nearly 20 years since I worked there, and now I am thoroughly convinced they have gone down the path of so many other consumer mass-market product companies. Sad. They really did have something nice going back then. And, here I am now, thinking I'll never buy another one of their products again -- especially not in hopes of obtaining the rebate or upgrade I am (supposedly) entitled to as the purchaser. Essentially, if I am to compare HP product prices to other vendors, there is no way I can compare with the rebate included - since it is essentially a vaporous promise.

GNU / Linux derivations visual diagram

I came across this very nice image showing the lineage of various GNU / Linux distributions over the past 15 years (since 1992). It's rather amazing how many flavors of the operating systems now exist, and what all the specialty distros are all about.

One could perhaps argue that having a couple hundred distinct distributions is a bit much, and that Linux could evolve faster if some of these disparate projects could just find a way to come together and focus their talents on a single solution. But, alas, that is not going to happen from the looks of things.

Surely some of these "specialty" Linux / GNU derivations fit a particular need - like being small enough to run optimally from a USB-Drive or such. But, I still have to wonder why even that type of need can not be just a matter of flipping a few configuration "switches" on a larger aggregated distribution, where by means of toggling a few parameters, you could create a USB-optimized-linux from the same root-OS that you would otherwise install on your desktop.

Well, at least that graphic obviates the argument about whether Linux development is active - certainly there are plenty of people working on the operating system and software to run under it.

Rampant Anabolic Steroid Abuse

When the details of pro wrestler Chris Benoit's anabolic steroid "prescriptions" came out recently, it only confirmed what I have assumed to be true of most of these pro wrestlers (and perhaps some other athletes) that have bodies that appear to defy the laws of nature. I just read this CNN Article about Benoit's excessive steroid purchases, and some of the excess (like there is a "normal" level of anabolic steroid use?) mentioned include:

• "Dr. Phil Astin prescribed a 10-month supply of anabolic steroids to Chris Benoit every three to four weeks between May 2006 and May 2007, a Drug Enforcement Administration agent said in an affidavit filed Friday and made public Monday."
• "The [Benoit] boy had old needle marks in his arms, Ballard has said. He said he had been told the parents considered him undersized and had given him growth hormones."
• "[Benoit's doctor] Astin had written prescriptions for about 1 million doses of controlled substances over the past two years, including "significant quantities" of injectable testosterone cypionate, an anabolic steroid, according to the criminal complaint."

Gee, do you really think Benoit is the only professional wrestler or athlete that has a friend that happens to be a doctor willing to write "prescriptions" for anabolic steroids? I think not. It'll be interesting to see who else shares Benoit's doctor as a friend who is willing to help them get huge! I can guarantee that the bulk of these super-size (nearly freakish-size) ultra-muscular people have at one time or another abused steroids.

I have always been into weight-lifting, especially during my college years and the following 10 years or more. In all that time, I constantly pushed more and more weight, and gained substantial strength, but, the one thing I never gained much of was size. Sure, I can get toned and muscular, but nothing like these guys whose muscles look like balloons. No matter how much I lifted, I just could not put on much more than 10 or 20 pounds of muscle over my body's normal non-workout size. And, all of the weight-lifting I ever did was done "clean" - meaning, without any chemical / steroidal enhancement.

I am sure some people have a physical predisposition to being able to amass extra muscle better than others, but not to the extent of these pro wrestlers and such. During my college years, quite a few of the guys in the weight room who were physically substantially larger than me were abusing steroids. I have known friends and acquaintances that made incredible physical-mass gains using anabolic steroids, and who most likely never would have put on such size without them. Some of these people even tried to encourage me to join them in their steroid use - but, fortunately, my common sense prevailed and I avoided the temptation for fast gains completely.

Because of my exposure to people that were using anabolic steroids, as well as my exposure to others who lifted and body-built "clean", I find it quite easy to look at people and within moments determine with reasonable certainty whether or not they are, or have been, using steroids. There is a norm for humans that can quickly be exceeded when one is using chemicals to gain a physical advantage, and that norm (or the non conformance to such a norm) can usually be detected with even minimal observation. Given that, I tell you, nearly everyone in the WWE appears to be using Anabolic Steroids on a regular basis! And, somehow the news of Benoit's abuse is "surprising" or unexpected?

I really think it is time someone took this abuse seriously. The DEA should easily be able to obtain records of every doctor that is prescribing anabolic steroids. I am a firm believer in doctor-patient confidentiality, and the DEA need not know who the end-recipients of such drugs are in order to detect patterns of abuse. There must be some sort of "baseline" level of truly justifiable and medically-required anabolic steroid prescriptions (I guess), and if a doctor exceed that level, there is probably a good reason to dig deeper.

Screening and testing of wrestlers and athletes is a joke too - whether "independent labs" are involved or not. Fact is, I'll bet the "independent" labs still have a vested interest in maintaining clients, and as such, make sure that results are as they need to be (by casually looking the other way as a certain person substitutes their urine-sample, or whatever else needs to be done). If the labs aren't in on allowing abuse to continue, then they are just plain clueless to all the tricks that are used to pass tests. One way or the other, something needs to change, and testing and enforcement needs to be consistent, accurate, and meaningful.

Whether these people (like Benoit) have a "prescription" for the anabolic steroids or not should also not matter. It seems rather apparent that the sole reason for such a prescription in this case is to become huge and/or strong, which certainly is not justification. If it is, then anyone that wants anabolics / testosterone should be able to walk into their doctor's office and say "I want steroids, as I want to get huge!" and have a prescription with few additional questions or obstacles.

Bottom line: either enforce existing laws against anabolic steroid use (by all persons - including "pros" and famous people), or get rid of the laws altogether since they appear to not apply to a certain group of people. Either way, I think we can at least all stop acting surprised when we hear about someone that has abused steroids, as I can almost guarantee the Benoit case is nothing too uncommon.

Huge Home Inventory does not stop New Building

I just read this article about how the Inventory of US homes for sale hit a 15-year high, with nearly 4.5 million homes on the market for sale. If this isn't disturbing enough, especially when put in the context of how this represents a nearly 9-month inventory of homes, consider how this biggest inventory overhang since 1992 seems to be occurring when the economy is supposedly rather good overall. And, the median home price has slid another couple percent - for 10th straight month of declines.

What I just don't get is why, if there is such a glut of homes on the market, is so much new building going on? Everywhere I turn here in Northeast Ohio, I see yet another new development to be filled with $250K+ homes (which, by the way put them above the current median nationwide price of $223K). The people filling these homes are moving from homes that they can not sell, thus further increasing an already ballooning inventory situation.

I guess people just are not happy with their "old" homes, and being typical US consumers, they feel the need to constantly move into larger and more luxurious accommodations. If that isn't it, someone please let me know what this trend (of massive continued development during massive existing-home inventories) is all about. Personally, I think it signals an impending crisis. Time will tell.

Warranties are nothing more than marketing hype!

It seems that many a product or service "warranty" these days is nothing but a misleading sales phrase - something that sounds good, but doesn't really offer any advantage over having no warranty at all. I am completely and profoundly aggravated by the way companies think it is perfectly acceptable to offer a warranty or guarantee they have no intention of honoring, or one whose fulfillment conditions are so convoluted, complex, idiotic, and/or time-consuming that you basically give up before realizing any true benefit from this supposed perk.

My most recent encounter with an utterly lame warranty is with LG Electronics, in regards to a dehumidifier I purchased 2 years ago with a "5 year parts and labor warranty" that even included "in home service". Yeah, right! What sounded so good at time of purchase (and, helped me decide which product to purchase) is now nothing more than a reminder that many companies have little intention to make due on such a warranty without at least trying to drive you insane first.

The plight begins innocently enough with calling an 800# for customer service, and of course waiting 15 minutes for a human to actually answer the phone. They collect the various information about the model number, serial number, and your contact information, and then proceed to tell you how, even though you live in a major metropolitan area and have in-home service covered under your "warranty", that the in-home part is subject to them finding a service-provider near you that is willing to actually come to your house.

This is a common trend these days -- outsource the responsibility for providing any type of service (be it warranty or otherwise) and then blame any shortcomings on the third-party. So, you have a warranty from LG, but the service comes from whomever is willing to even do it. Lovely. LG then provides me with a phone number to a place 20 miles away -- I refuse! I tell them to look harder for a closer service point, and finally get one only 5 miles away. Now, things are in my court, since LG Electronics is not responsible for their recommended firm's actions.

So, I call the local service company - they are closed on Friday it seems. I wait, and try Monday, and get a scheduled service call (to my house amazingly) for a week later. The week passes, the technician arrives, and confirms what I know (the dehumidifier is shot and needs replaced), and then tells me how that is not up to him, and that they will contact LG and let them know the status, and I should hear something soon.

A week passes - nothing. I call the local place... they have no information, and have never called LG, since they can do nothing for me, and suggest I call LG Electronics Warranty Service again. (are you seeing the circle form?) I call LG. They now tell me I need to Email or Fax them all the same information they already have, and that the appliance local service company needs to call LG "technical support" and have LG's engineers concur that the unit needs replaced. Of course, I ask, what is the incentive for the appliance repair people to call you? Can't you (LG) call them and make sure something happens?!!! Oh, of course not! That is not how it works. And, what can I, the consumer do to make sure anything gets done -- NOTHING! (as planned I am sure).

So, unless I can influence people and events outside of my control, there is little I can do but have (false) hope in people doing their job and honoring their warranty. I can not make the local appliance firm follow-through and call LG. I can't make LG call the local firm, because "that isn't the flow" or whatever. The LG customer service rep I speak with doesn't even have a company Email address (they use a somthing_lge@yahoo.com instead - surely because there is to be little record of any warranty requests), and they can't do anything about me getting a new replacement dehumidifier without tech-support approving it.

So, basically, don't count on any warranty unless you personally know ahead of time how the firm operates their warranty-returns process and such. This is ridiculous. A few weeks have passed, I want my dehumidifier replaced. I have gotten nowhere on this matter, aside from hours of wasted calls. Unless LG replaces this thing soon, and actually honors this "5 year parts and labor warranty", I'll never buy an LG Electronics product EVER again, whether it is a dehumidifier, appliance, television, or anything else!

Companies really need to learn that such insane "customer (dis)service" policies do nothing but piss off consumers and turn them to their competitors instead. But, sadly, I suspect all major companies of not caring, since many are quite similar in their lack of caring, knowing that you have no choice in most things, and that they will gain as many new consumers that are leaving their competitors for the same customer dis-service reasons as they lose in customers experienced with their own terrible service. I have had many of these types of experiences over the years, and usually the bigger the company the worse the experience, since they just don't seem to care in the least what they put the customer through.

My main concern now is: what brand of dehumidifier do I purchase next? My gut says simply buy the cheapest damn thing there is, since you might as well pitch it if it goes bad (after the 30-day in-store return or whatever), because in the end, warranty or not, it's all the same when companies have no intention of making the warranty something you can collect on (at least not without wasting more time than it is worth).

Screwed up economics

There is something fundamentally wrong with our economy when commodity prices (food and energy) are extremely high, while at the same time our country is flooded with cheap imported finished goods. Let me start by giving some examples of what has inspired my view that there are rampant incongruous economic underpinnings present throughout the United States (and the rest of the world I suspect).

My friend called me the other day to say how he had just purchases a brand new washing machine for $309.00, and on the same day received his natural-gas bill for February that was also $300.00. We both observed how this situation was both poignant and repugnant. How can it be that an entire washing machine is built, shipped (from overseas most likely), marked up (by a retailer), and delivered to one's house for no more total cost than heating the small house it was delivered too for a single month? When I consider the energy used to melt, roll, bend, shape, and weld the steel in the machine together, and the further energy consumed during transportation, display (lighting/heating at store selling it), and so forth, I just can't fathom how the additional raw material costs and labor and store profit can not put the price of this device over $300.00.

Next, I fill up my gas tank in my car. Luckily I do not drive much, but when I filled the near-empty tank this time, it cost $45.00! Then, I go to Staples to get a new office chair to replace an aging one I have, and see that I can purchase the exact replacement for less than what I just paid to fill up my gas tank. And, that chair has all sorts of plastic and petrochemical-based components in it, plus, as with everything else sold in the USA these days, it was shipped here from China, and has included packaging and markup, etc. How in the heck does this all work? I am fully aware of "economies of scale" and "mass production" and all, but something just doesn't seem to add up for me regardless. In the end, my chair purchase actually exceeded the price of my gas, since I decided that in relative terms, I might as well purchase a model that is better cushioned and ergonomically correct, even if it costs the same as 3 tanks of gas -- at least I'll get ten years or more out of the chair, versus a month or two of driving (like I said, I drive very little).

So far, I've only discussed energy prices. Food is equally insane! When I go to the store and see oranges for $1.00 each, or tomatoes for $3/pound, or Cantaloupe for $5/each, I just once again have to question the price of finished goods being so low. Are food prices in the USA completely manipulated (upwards), because if not, and the prices here were representative of the prices elsewhere in the world, the people making those cheap imported finished goods overseas could never even afford to eat!?! And, you can't blame shipping costs either, since I have checked into that and found that even for reasonably small shipments (a few tons) all the way from China to the USA, I can palletize and ship stuff for 25-cents/pound... and, the vegetables I'm discussing are coming from this continent!

Fact is, anything outside of the "core CPI", which by definition excludes the "volatile food and energy" sectors, is experiencing insane price pressures. I just don't get, if these energy and food prices are not just out of control here in the USA, how the price of finished goods is not soaring too. I suspect price manipulation at the point of origin (especially in China), but even that seems unable to account for everything.

So, I stick with my economics blog title of the day, that is, everything is screwed up!