2010 Apr 23 - Fri

Common Representation of IPv6 Address Text Representation

Most everyone knows how to write an IPv4 ip address, and is easy and simple to understand.

As the world migrates to a new internet addressing system, which is known as IPv6, writing out the address becomes difficult. The difficulty is that there are multiple ways of writing an IPv6 address. As a consequence, when people need to perform text searches, no matches may result because the way in which it was searched doesn't match the way in which it was written.

A new document has been authored entitled A Recommendation for IPv6 Address Text Representation which helps to standardize the process of writing an IPv6 address.

In a nutshell, the recommendation is:

• Leading zeros MUST be suppressed. For example 2001:0db8::0001 is not acceptable and must be represented as 2001:db8::1. A single 16 bit 0000 field MUST be represented as 0.
• The use of symbol "::" MUST be used to its maximum capability. For example, 2001:db8::0:1 is not acceptable, because the symbol "::" could have been used to produce a shorter representation 2001:db8::1.
• The symbol "::" MUST NOT be used to shorten just one 16 bit 0 field. For example, the representation 2001:db8:0:1:1:1:1:1 is correct, but 2001:db8::1:1:1:1:1 is not correct.
• When there is an alternative choice in the placement of a "::", the longest run of consecutive 16 bit 0 fields MUST be shortened (i.e. the sequence with three consecutive zero fields is shortened in 2001: 0:0:1:0:0:0:1). When the length of the consecutive 16 bit 0 fields are equal (i.e. 2001:db8:0:0:1:0:0:1), the first sequence of zero bits MUST be shortened. For example 2001:db8::1:0:0:1 is correct representation.
• The characters "a", "b", "c", "d", "e", "f" in an IPv6 address MUST be represented in lower case.
• When writing port numbers with an IPv6 address, the [] style as expressed in [RFC3986] SHOULD be employed, and is the default unless otherwise specified -- [2001:db8::1]:80

[/Personal/Technology] permanent link

Borrowing Money to make Money, Taxpayer Pays the Interest

Eric Fry, in teh Daily Reckoning, provides an interesting insight into the profitability of today's banking sector:

When it converted into a bank holding company back in 2008, Goldman became eligible to borrow cheap money from the Fed's discount window. Morgan Stanley did the same thing. As a result, Goldman, Morgan Stanley et al. may borrow billions of dollars from the Federal Reserve and use the proceeds to purchase higher-yielding government securities of longer duration.

In other words, Goldman may borrow from the government at 0.75%, then loan the money back to the government at 3% or 4%. All in a day's "trading." Not surprisingly, all the major financial firms have been reporting blockbuster profits. Yesterday, for example, Morgan Stanley wowed the Street by nearly doubling its expected earnings result. Bond trading provided most of t he juice, as Morgan's fixed-income revenue more than doubled from the prior year's first quarter.

Prior to Morgan Stanley's results, Bank of America, JP Morgan Chase and, yes, Goldman Sachs, h ad all reported record quarterly revenue from fixed-income trading. On the surface, these monster profits would seem like good news. But this silver cloud contains a very dark lining: without the Fed's low-cost financing, fixed-income profits will be much harder to come by.

[/Personal/Business] permanent link

World Events and the Iceland Volcano

Byron King at Whiskey and Gunpowder wrote about how natural relate to human events through history. Any history buffs able to confirm the following?

We need to keep an eye on Iceland and its grumpy volcanoes. The historic record is filled with Icelandic volcano blasts that wrecked European civilization. It goes back at least to the days of the Roman Empire. There's evidence that an Icelandic eruption in A.D. 405 led to a harsh winter the next year, in which the Rhine River froze. This allowed the barbarians cross in numbers sufficient to defeat the Roman Legions.

In A.D. 934, there was a massive lava flow from Iceland's Eldgja fissure system. It unleashed the largest basalt flood in recorded history. An ash cloud blanketed Northern Europe and weakened many political structures. This eruption helped keep the Dark Ages dark, and in particular harmed the English political system. It's no coincidence that William, Duke of Normandy, conquered England a century or so later, in 1066.

Then there was the Laki eruption in 1783, with another immense outpouring of lava in Ice land. This eruption emitted large volumes of poisonous gas, including fluoride and sulfur dioxide chemicals that poisoned half of Iceland's livestock. The gas cloud blew over Scandinavia as well, causing many deaths and hardships that included a long famine.

There were many deaths further south in Western Europe, as well, in 1783. Then came several years of extreme weather. Among other problems was a shortfall in farm output. This led to a drop in tax receipts for governments across the continent. In France, King Louis XVI eventually had to summon the Estates General to ask for new taxes. Instead, he wound up with the French Revolution.

The San Francisco earthquake of 1906, for example, caused many banks and insurance companies in the U.S. and Britain to fail. This led to the Panic of 1907. The Panic of 1907 led directly to the creation of the U.S. Federal Reserve in 1913.

He goes on to provide some modern day statistics regarding the volcano:

According to Eurocontrol, which operates the airspace in Europe, about 20,000 flights per day are canceled. By my back-of-the envelope calculation, that translates into about 1.5 million barrels of jet fuel per day that's not being burned to power airliners. That's just shy of 2% of total daily world oil demand. So with this fast hit to demand, it's no wonder that the price of oil has dropped about $4 per barrel in the past week.

Meanwhile world trade is indeed suffering. Perishable items, from flowers to exotic fish and fruits, are rotting on the loading docks. High-value items like computer chips and diamonds are sitting in secure warehouses. Much other airfreight is just stacking up on the pallets. FedEx and UPS together carry about $1.3 billion of goods per day between North America and Europe. Right now, it's almost all shut down.

The ripples are global. For example, Chinese auto assembly lines are slowing down due to lack of electronic components from Germany. There are reports of mass layoffs in nations as far apart as Kenya and Colombia, due to the inability to export goods via airfreight to Europe. Then consider all the personal and business disruptions and expenses from casual and business travelers unable to fly.

[/Personal/History] permanent link

2010 Apr 03 - Sat

Market Notes - 2010/04/02

Cumberland Advisors Market Commentary indicates that there have been 8.4 million American jobs lost due to the recession, and that it may take upwards of four years to recover those jobs. That would be a recovery of about 175,000 jobs per month, every month.

The Federal Open Market Committee (FOMC) says that unemployment is going to stay at 9.5 to 9.7 percent for 2010. It may decrease by the end of 2011 to 8 percent and to around 7 percent at the end of 2012. This would tend to indicate that the majority of job recovery will not happen till 2013 at least.

Cumberland suggests that the Fed will be balancing job creation with inflation:

... there is a tradeoff between employment and prices, with inflation increasing when unemployment reaches a critical low rate. The Fed's job is to strike a balance so that sustainable economic growth that maintains full employment doesn't trigger an outbreak in inflation.

The Fed strikes this balance through something called the Phillips Curve Framework:

... as unemployment declines, labor markets become tight, employers bid up wages, capacity utilization decreases, and to maintain profits companies increase prices ... With the current substantial slack in the economy, a stagnant housing market with prices still not completely stabilized, few signs of impending inflation, and a continuing problem in the commercial real estate market, the FOMC can focus on jobs and keep interest rates low to support growth in the real economy as it gradually recovers.

Cumberland figures that

the continued weakness in the job market, no impending signs of inflation, and a fall election will keep policy interest rates at approximately their same level through this year.

This week's job report indicated payrolls rose by 162,000 jobs, which includes 48,000 temporary census workers. This could be a sign of recovery. Others say it is a recovery from February snow storm effects. However, previous months results have also been revised upwards, so it may not be so bad. Chart of the Day indicates a couple of things: job losses were more significant on this recession, and that job losses have probably bottomed out.

However, in a recent Gallup pOll finds that 20.3% of the US Workforce was underemployed in March. Gallup concludes with:

As unemployed Americans find part-time, temporary, and seasonal work, the official unemployment rate could decline. However, this does not necessarily mean more Americans are working at their desired capacity. It will continue to be important to track underemployment -- to shed light on the true state of the U.S. workforce.

Back in Nov 2, 2008, I reprinted an article regarding Why the Mortgage Crisis Happened. In Wednesday's Casey's Daily Dispatch, I read about the US Government's next big bit of legislation

would give the government unprecedented powers to split up firms considered too risky, and thus a threat to the economy, as well as put together a council of regulators to watch for risks in the financial system and create an independent consumer protection agency.

• It will end bailouts, ensuring that failing firms can be shut down without relying on taxpayer bailouts or threatening the stability of our economy.
• It will create an advance warning system in the economy, so that there is always someone responsible looking out for the next big problem.
• It will ensure that all financial practices are exposed to the sunlight of transparency, so the exotic instruments like hedge funds and derivatives don.t lurk in the shadows and businesses can compete on a level playing field.
• It will protect consumers from unsafe financial products, such as the subprime mortgages that led to the financial crisis.

It seems to me that if the government undid all the stuff they've implemented since 1933, we wouldn't be in this mess, and wouldn't need these fixes. The second item above is particularily ironic, what with one hand of the government creating the mess, and the other hand of the government attempting to police the action.

Casey's Report goes onto to say it much better than I:

I do take issue with creating yet another bureaucracy tasked with 'consumer protection'. It's my understanding that prior to the financial crisis no fewer than seven regulatory agencies were tasked with the exact kind of 'consumer protection' proposed by Dodd's new bill. And they didn't do a darn thing to help.

Other evidence of government's incapability of policing markets comes to light with a whistle blower's report of Gold Market Manipulation. It is said that the market manipulation was to:

The objective of this manipulation is to conceal the mismanagement of the U.S. dollar so that it might retain its function as the world's reserve currency. But to suppress the price of gold is to disable the barometer of the international financial system so that all markets may be more easily manipulated. This manipulation has been a primary cause of the catastrophic excesses in the markets that now threaten the whole world.

Additionally:

... the CFTC hearing revealed that there is 100-times more paper-gold outstanding than physical gold ... if we get a squeeze on the naked shorts, the sky is the limit for precious metal prices... Over the past ten years, the gold cartel has staged a controlled retreat. It has been fighting the advancing gold price with propaganda, paper short sales and the occasional dishoarding of physical metal from central bank vaults and more recently, the IMF. This retreat is I suspect about to turn into a rout, which means the upside potential for the precious metals is huge.

[/Trading/MarketNotes] permanent link

Welcome to Planet NIT WIT

NIT WITs (Nationalize, Inflate, and Tax . Whatever It Takes) in Washington

Taken from a Casey Daily Dispatch:

Key among the tools used by governments around the globe to fund their steady expansion are the rights they take unto themselves to Nationalize, Tax, and Inflate, or NIT for short.

And they don't stop there. If a problem arises that threatens the status quo in any way, governments these days are quick to do "Whatever It Takes" (WIT). And we.re not just talking about snuffing out Arab bogeymen in Dubai hotels or handing over $180 billion to failing insurance companies - these days, if a problem is considered serious enough, no obvious limits need apply.

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2010 Apr 02 - Fri

Checked Iterators in Microsoft Visual C++

I've wondered why some of my C++ programs seem to run slower than I think they should be running. Then I came across an article regarding Checked Iterators, and it become clearer to me where some of my execution speed issues could be. By default, in debug mode, all standard iterators are bounds checked. This checking can cause a slow down in execution speed when using standard iterators extensively.

The solution is to set certain macros to selectively enable and disable the checking on proven code. A Microsoft MSDN article on Checked Iterators describes the two symbols used for controlling the checked iterators feature:

• _SECURE_SCL: If defined as 1, unsafe iterator use causes a runtime error. If defined as 0, checked iterators are disabled. The exact behavior of the runtime error depends on the value of _SECURE_SCL_THROWS. The default value for _SECURE_SCL is 1, meaning checked iterators are enabled by default.
• _SECURE_SCL_THROWS: If defined as 1, an out of range iterator use causes an exception at runtime. If defined as 0, the program is terminated by calling invalid_parameter. The default value for _SECURE_SCL_THROWS is 0, meaning the program will be terminated by default. Requires _SECURE_SCL to also be defined.

[/Personal/SoftwareDevelopment/CPP] permanent link