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 | http://www.gilder.com/ | Issue 321.0/December 21, 2007

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HEADLINES:

-  The Week / The Terrifying Future of Computing
-  Friday Feature / The Dangers of Living in a Zero-sum World Economy
-  Friday Blogger Bonus / Don't want to be the Grinch, but…
-  Readings /


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The Week / The Terrifying Future of Computing

Spencer Reiss, Wired (12/20/07):
Q&A: Author Nicholas Carr on the Terrifying Future of Computing

Nicholas Carr is high tech's Captain Buzzkill — the go-to guy for bad news. A former executive editor of Harvard Business Review, he tossed a grenade under big-budget corporate computing with his 2004 polemic Does IT Matter? (Answer: Not really, because all companies have it in spades.) Carr's new book, The Big Switch, targets the emerging "World Wide Computer" — dummy PCs tied to massive server farms way up in the data cloud. We asked Carr why he finds the future of computing so scary.

 

Wired: IBM founder Thomas J. Watson is quoted — possibly misquoted — as saying the world needs only five computers. Is it true?

 

Carr: The World Wide Web is becoming one vast, programmable machine. As NYU's Clay Shirky likes to say, Watson was off by four.

 

Wired: When does the big switch from the desktop to the data cloud happen?

 

Carr: Most people are already there. Young people in particular spend way more time using so-called cloud apps — MySpace, Flickr, Gmail — than running old-fashioned programs on their hard drives. What's amazing is that this shift from private to public software has happened without us even noticing it.

 

Wired: What happened to privacy worries?

 

Carr: People say they're nervous about storing personal info online, but they do it all the time, sacrificing privacy to save time and money. Companies are no different. The two most popular Web-based business applications right now are for managing payroll and customer accounts — some of the most sensitive information companies have.

 

Wired: What's left for PCs?

 

Carr: They're turning into network terminals.

 

Wired: Just like Sun Microsystems' old mantra, "The network is the computer"?

 

Carr: It's no coincidence that Google CEO Eric Schmidt cut his teeth there. Google is fulfilling the destiny that Sun sketched out.

Read the complete interview:
http://www.wired.com/techbiz/people/magazine/16-01/st_qa


NOTE: Spencer Reiss is the former editor of Gilder Publishing’s New Economy Watch newsletter. Visit the archives on http://www.gildertech.com/.


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Friday Feature / The Dangers of Living in a Zero-sum World Economy


Martin Wolf, Financial Times (12/19/07):
We live in a positive-sum world economy and have done so for about two centuries. This, I believe, is why democracy has become a political norm, empires have largely vanished, legal slavery and serfdom have disappeared and measures of well-being have risen almost everywhere. What then do I mean by a positive-sum economy? It is one in which everybody can become better off. It is one in which real incomes per head are able to rise indefinitely.

 

How long might such a world last, and what might happen if it ends? The debate on the connected issues of climate change and energy security raises these absolutely central questions.

 

As I argued in a previous column ("Welcome to a world of runaway energy demand", November 14, 2007), fossilised sunlight and ideas have been the twin drivers of the world economy. So nothing less is at stake than the world we inhabit, by which I mean its political and economic, as well as physical, nature.

 

According to Angus Maddison, the economic historian, humanity's average real income per head has risen 10-fold since 1820. Increases have also occurred almost everywhere, albeit to hugely divergent extents: US incomes per head have risen 23-fold and those of Africa merely four-fold. Moreover, huge improvements have happened, despite a more than six-fold increase in the world's population.

 

It is an astonishing story with hugely desirable consequences. Clever use of commercial energy has immeasurably increased the range of goods and services available. It has also substantially reduced both our own drudgery and our dependence on that of others. Serfs and slaves need no longer satisfy the appetites of narrow elites. Women need no longer devote their lives to the demands of domesticity. Consistent rises in real incomes per head have transformed our economic lives.

 

What is less widely understood is that they have also transformed politics….


Read on:
http://www.ft.com/cms/s/0/6b28b57a-add3-11dc-9386-0000779fd2ac.html?nclick_check=1

RELATED READING

Rich Karlgaard, Digital Rules blog (12/20/07):
The no-growth wing of the green movement cannot wash its hands of the calamitous consequences of zero growth and a zero sum world… Link: http://blogs.forbes.com/digitalrules/
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Friday Blogger Bonus / Don't want to be the Grinch, but …
 

Aaron Katsman, BloggingStocks.com (12/20/07): Don't want to be the Grinch, but the economy isn't so bad

 

Today's report that the US economy grew buy 4.9% in the 3rd quarter even with pressure from the housing market, is a tribute to the strength of the economy. The fact that in the third quarter, the housing slump cut a sizable 1.08% off GDP, makes you admire just how strong and resilient the economy is. I hate to burst the bubble of the mainstream media (could they have a political agenda?), but facts are facts. Unemployment remains low at just 4.7%, the economy is growing, taxes remain low, and interest rates are falling. I admit that fourth quarter (Q4) GDP numbers wont equal Q3's but a recession? Not going to happen. The pessimist always say that the consumer will stop spending and that will be the nail in the coffin. Well I have been hearing this for years and years, and they continue to spend and there is no reason to think they will stop spending….

Read the entire blog on BloggingStocks.com:

http://www.bloggingstocks.com/2007/12/20/dont-want-to-be-the-grinch-but-the-economy-isnt-so-bad/
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Readings /

A Christmas Column
http://www.forbes.com/opinions/2007/12/15/trout-marketing-religion-oped-cx_jt_1218trout.html

 

Qualcomm Raises Forecast
http://online.wsj.com/article/SB119816123736642421.html?mod=technology_main_whats_news

Slower light for faster telecom networks
http://www.spectrum.ieee.org/dec07/5795
 
Weekly GTI Index
http://www.gtindex.com/   

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Friday Letter Editor: Mary Collins George / mcollins@gilder.com
 

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