For almost a decade now, I have run a list of technology predictions for the coming year.

This year is different, there is no list, because:

1. Not that much will visibly happen in the web industry, there’s not exactly going to be a plethora of IPO’s, private equity driven M&A, new VC investments, product launch cocktail parties or company expensable conference junkets. Web 2.0 will die with a whimper rather than a bang, and the clever people will have plenty of thinking time to work quietly on the innovation will drive the next cycle. It should be noted, however, that it looks like the legacy of this time around (Youtube, Flickr, Facebook), is not that impressive compared to last time, or even what happened in between (Google, Paypal, Skype). Perhaps Kleiner Perkins were right to pass?

2. The changes we are seeing are macro changes that take years. We will see the acceleration of the shift online for things like commodity eCommerce (i.e. non luxury and based on price), media rental and broker intermediated transactions. By the end of this recession, there will be fewer shopping malls, Blockbusters or Virgin Megastores; travel agents will be near extinct, and there will be far less realtors. Amazon, Google and possibly even Neflix will be much bigger companies and a hybrid of UK style franchised real estate brokerage (Foxtons) and aggregated online real estate sites (Trulia) will largely wipe out information blocking middle-men like the independent realtor.

3. Short term gloom will mask longer term optimism. After periodic mini rallies, there will be another major stock decline for companies such as Google, after a second wave of economic bad news. This will preface a long steady climb for companies that belong in the emerging, remade landscape.

4. There will be a short term focus on shoring up existing industries to create jobs, but whatever America does to prop up industrial production will fail in the long term. Things like low end cars perhaps shouldn’t be made in the US. Conversely the reactionary overshoot of financial services regulation and the death of monetarism will mean that America cannot rely on a Thatcher style services economy. Even if technology and culture (media) will be America’s flagship industries, employment creating stimulus programs will mask this change.

5. US military and economic hegemony will inevitably decline, from its post Cold War singularity, and the events of last year are possibly the inflection point. The future role of America’s near total dominance in something seemingly far less important, such as the Internet, will be different. This is a change whose effects are currently impossible to predict. Note this doesn’t mean that America role as a sole superpower is superceded by China or something that melodramatic, just that the abnormal and unsustainable period of near global, single nation dominance will recede. With it, there will be cultural changes. The world will become slightly less Americanized, and that possibly means the diminishing of an historically abnormal culture dominated by what can best be described as recreational shopping.

6. The short term fluctuations in the fortune of web 2.0 companies are completely irrelevant considering the long term changes to the Internet industry and the short term affects elsewhere. In other words, even for those who work in technology, what is happening in the industry is irrelevant compared to both the effect that the collapse of the US banking system could have on our lives in the short term and the effect of secular technological trends.

7. America is in a similar place to Britain at the end of the Edwardian era. Frankly there is a lot more to worry about than a 40% decline in display ad revenue. Om Malik, one of the the most likeable and wise people in the industry put things in perspective best.

“That’s the last bubble I can find in the U.S. I cannot imagine why anybody would give money to the U.S. government for 30 years for less than a 4% yield. I certainly wouldn’t. There are going to be gigantic amounts of bonds coming to the market, and inflation will be coming back. “

Link

Hear hear.

Niall Ferguson reviews Lords of Finance:

“As the world teeters on the brink of another great financial cliff, we can only hope that the modern-day Lords of Finance will co-operate to better effect. I suspect none has much time for bedtime reading these days. But should Messrs Bernanke, King and Trichet need a reminder of what can go wrong when central bankers achieve only the semblance, but not the reality, of co-operation, Lords of Finance is the book they should read.

As a matter of urgency, a Chinese translation should also be sent to Zhou Xiaochuan, governor of the People’s Bank of China.”

(Pedant’s note: A brink is an edge of a cliff. Its funny that the expression “teeters on the brink…” which is normally used as a metaphor, e.g. “teeters on the brink of recession” jars like a mixed metaphor when used in its literal sense, as it is here.)

The Council on Foreign Relations have pulled together a bunch of graphs about the recession. The results are disturbing.

1. Shanghai – down 65.2%
2. Mumbai – down 51.9%
3. Singapore – down 49.2%
4. Hong Kong – down 48.3%
5. Paris – down 42.7%
6. Tokyo – down 42.1%
7. Sydney – down 41.3%
8. Frankfurt – down 40.4%
9. New York – down 34%
10. London – down 31.3%

London has the worst year in its history (but the index in question is only 20 years old), although comes out bottom of the list in terms of severity.

The chart is interesting in that the two places which could be worst affected in the longer term are New York and London, and the markets that are most likely to bounce back are Shanghai and Mumbai. This is partly a function of size and resulting inertia.

Link

Tim Lambert shreds Global Warming denialists such as Matt Drudge.

The recent appropriation of the term ‘denialist’ which is traditionally paired with ‘holocaust’ is a minor PR victory for scientists who are not normally good at this. I like it.

Jesus, if he existed, was almost certainly not born tomorrow – but Isaac Newton was.
Happy Newton Day.

“It was the year that the Large Hadron Collider was finally fired up — and then abruptly shut down — and 2008 also saw significant progress towards the detection of dark matter. Physicists got a little closer to making practical quantum computers and 2008 saw a few nifty inventions to harvest energy from human motion. US president elect Barack Obama made a few high-profile science nominations that could signal a change in the US government’s view of climate change. It was also a good year for Japanese physics, as three Japanese-born particle physicists won the Nobel Prize in Physics.”

Link

The headline sound like an exaggeration, but this is exactly what Paul Krugman has alleged today:

“$400 billion a year in waste, fraud and abuse.
But the costs of America’s Ponzi era surely went beyond the direct waste of dollars and cents.
At the crudest level, Wall Street’s ill-gotten gains corrupted and continue to corrupt politics”

Amazing.

Alexandra Penney, a 60 something, urbane, Manhattanite, former magazine editor, lost her life savings in the Madoff scheme. Her story is told here.

This is a tragedy, Penney has fallen a long way from a dizzying New York height and has contemplated suicide. She didn’t inherit her money, she fought hard for it as a single mother. She wrote a best selling book called How to Make Love to a Man, and now she has been royally screwed by one, Bernie Madoff.

She now faces not ruin, but having to move out of her Upper East Side apartment, selling her second home in West Palm Beach, getting rid of her Soho studio, using her reserve savings account, taking the subway for the first time in 30 years and ironing her 40 white shirts.

Its through the banal detail of ironing that within this story, an untold one surfaces, about Alexandra’s maid, Yolanda.

“She needs money. She sends it to her family in Colombia. I have more than affection for Yolanda, I love her as part of my family.”

Yolanda is presumably one of those invisible people that served at the party when times were good, but we don’t know much about her, because people like Yolanda don’t often feature in magazine profiles.

We hear from Alexandra that she will be let go. Sold off with the “high thread count sheets, old china, watches, jewelry, Hermes purses, and Louboutin shoes”, when the proceeds from these could perhaps have secured both Yolanda and her family’s future.

In doing so, this could have been a real triumph over adversity, it could have been Alexandar Penney’s finest hour, her redemption. But instead, like Madoff’s billions, she blew it.

I genuinely feel sorry for Alexandra, happiness and perceived calamity are relative. I would be devastated by a fall to the level that millions around the world struggle to live on, so it would be hypocritical to judge too harshly. But there is a difference between hard times and not enough to eat, and that is what people like Yolanda face. You cannot let them eat cake.

Poor Alexandra, poorer Yolanda.

Terre Natale is an exhibition at Jean Nouvel’s Cartier Foundation about people displaced by conflict and natural disasters, based on the work of Paul Virilio.

I am not a fan of Virilio (I am not a fan of anyone whose bio includes both of the words French and philosopher, to be honest) but this exhibition is both excellent and groundbreaking.

It includes a stupendous cylindrical projection of animated quantitative data representing the flow of displaced people, wordwide, in an environment designed by Diller Scoffidio + Renfro.

Michael Zick Doherty worked on the stunning graphics which were produced using the open source data visualization application, Processing.

The only problem with the animations, is that they are so beautiful and seductive that you have to consciously remember that what is being explained is a global tragedy. This is perhaps the sad but unavoidable result of the quasi-autistic nature of quantitative over qualitative.

A must read piece by Steven Novella on the dangerous, widespread acceptance of fraudulent and quack medicine, such as homeopathy (water) to the extent that this statement may seem controversial:

“Fifty years ago what passes today as CAM (Complementary and Alternative Medicine) was snake oil, fraud, folk medicine, and quackery. The promoters of dubious health claims were charlatans, quacks, and con artists. Somehow they managed to pull off the greatest con of all – a culture change in which fraud became a legitimate alternative to scientific medicine, the line between science and pseudoscience was deliberate blurred, regulations designed to protect the public from quackery were weakened or eliminated, and it became politically incorrect to defend scientific standards in medicine.”

After the collapse of the banking industry, deregulation is becoming a dirty word. Perhaps its time to fight back against the deregulation that allowed for alternative medicine? After all, this was a battle originally lost because of emotion rather than reason.

As Steven Novella puts it:

“Why hasn’t Ralph Nader noticed this? What if the auto industry promoted “automobile freedom” laws so that consumers could buy any vehicles they wanted, free from any government quality or safety regulation?”

Link