Long-time readers know I bitch when others obviously swipe my stuff without credit. (By the way: Fuck you, Ina Fried, I had a post up about Flash in tablet commercials two weeks ago).

Where was I?

Oh, right. Yes, theft bothers me. But you know what makes it worth it?

Well, it's always theft, so nothing, but still, one thing that mitigates the sting is how *I'm so f-ing right and ahead of the "journalists" who, near as I can tell, are even lazier then they are less smart. 

And not just about smartphones. Readers will note that I have written many times here why the *21st century* is the American Century. My posts on this topic are several and typically met with scorn.

"Ha! America is in decline! China is rising!" That sort of thing.

Wonder if they've read this report, or if they are capable of making any strategic thoughts not based solely on the here and now?

If China’s growth decelerates that fast, that far, the biggest question in world politics won’t be how the rest of us will accommodate China’s rise.  The question will shift to whether China can last.

The report, well covered in the Wall Street Journal, is a sober read.  Overall, world growth is expected to decline, with both China and India leading the decline.  The advanced countries are expected to recover from the current slump, but growth will remain anemic for years to come.  In other parts of the developing world, growth could slow to a crawl, presumably reflecting poor demand for basic commodities in a slow growth world.

Forecasts almost never come true, and economic forecasts at this point are much less reliable than weather reports.  But the main story here is that some of the best trained, and best connected economic minds in the business are changing their tune about China and India.  The inexorable rise of the supergiants has been the dominant meme in the fashionable chit-chat about global economic and geopolitical trends for some time.  The Conference Board report gives respectability and visibility to a more textured and, in Via Meadia’s view, more realistic view of what lies ahead.

The Conference Board could still be understating the problem.  If growth deceleration results in serious instability, blows out the financial system (a distinct possibility), or simply ties the hands of China’s policy makers so that they can’t respond in a timely fashion to changing circumstances, deceleration could turn into something much more dramatic very fast.

Epic political/economic takedown.

But be mindful, my fellow Americans. Those "super rich" discussed in the video gave just as much, probably much more, to Obama's campaign. This is not a partisan issue. Be even more mindful: your definition of "middle class" and of what helps the middle class is probably shockingly outdated in a real-time, hyperlocal, globally connected world. 

In an essay in HBR that I can only assume will quickly get picked up by every single media outlet -- or shut down by The Man -- Umair Haque ponders the next bubble.

Which is everything.

 How's your house price doing? Where would your 401K be, if central banks withdrew life support for banks? How steep is a college education this year (hint: on average, 10-15% more than last year)? How are weekly grocery and gas prices doing? Where are commodity prices — not to mention gold — headed? Bubble, bubble, toil, and trouble: these days, it seems, everywhere you look, there's a bubble inflating — or popping.

Examined closely, relative to GDP, living standards already did collapse: examined closely, measures of gross industrial output decoupled from still deeply flawed but perhaps slightly more meaningful measures of human welfare, like the Index of Sustainable Economic Welfare andGenuine Progress Indicator, which have at best sharply lagged, or at worst flatlined, for decades.

The plain truth might be that we're living beyond our means because our way of life atrophied our means. And it may be that way we live, work, and play requires deep transformation — if we're to upgrade our means to live, work, and play better tomorrow.

A hearty kick between the legs to America's homeowner class, which, given our culture and tax structure and our state-of-the-art financial instruments accessible by everyone, yet trickled up to a select few, is, well, pretty much all of us.

From the US Bureau of Labor Statistics:

Nobody's fucking working!

Oh, wait. Sorry. That was last week's BLS news. The bit about home ownership here:

The primary argument made in favor of homeownership is that it is the best way for many people to save money: in purchasing a home, people force themselves into making mortgage payments, thereby increasing their share of ownership in the property relative to the bank's share.

However, financial developments over time have decreased the strength of this argument. For example, there are interest-only mortgage contracts, which make it possible for households to pay nothing but interest for a number of years. Even when people have built equity, many of them are able to tap it to pay bills. In addition, housing wealth affects people's marginal propensity to consume: for every dollar of appreciation in house prices, homeowners spend somewhere between 3 cents and 10 cents more than before. 

Homes are often thought of as relatively safe investments that tend to perform very well in the long run, but that this is a myth. From 1975 to 2009, the real rate of return of the national house price index was 1.3 percent; if one assumes a 2.5-percent annual depreciation rate, a 1.5-percent property tax rate, a 7-percent mortgage interest rate, and a 25-percent marginal income tax rate, the real rate of return on a typical home actually drops below zero (to -0.575 percent).

Homeownership can decrease mobility and that mobility is a condition for an efficient labor market. People tend to be especially averse to selling their homes and moving when doing so would incur a loss. In conclusion, the authors state that "homeownership is not for everyone" and that "the case for trying to achieve a nation of homeowners needs to be rethought."

The Smartphone Wars is called that not just because it's a multi-trillion dollar global market with numerous players battling it out over money, share, profits, victory. It's also called the smartphone wars because the process of getting to 1 billion, then 2 billion, then several more billion smartphone users will remake the planet. It alters jobs and job opportunities, modes of interaction, how we learn, where we can work, access to information, existing industries and cultures.

Which is why in the early days of this site I laid out various predictions for the year 2016. And I had reasons for why I chose the year 2016:

And the future starts in 2016. This is the year of the Olympic Games, held for the first time ever, in the "developing world"; Brazil. This is the year of the end of the potential second term of the transformative presidency of Barack Obama. This is the year of a billion plus smartphones and the demarcation of wealth creation and opportunity shifting from the old to the new. This is the year India rockets a man into space. This is the year, 2016, when all entitlement/non discretionary spending consumes nearly 90 cents of every US government dollar. This is the year I predict the following will happen (if not sooner).

Sure, it seems naive now, quaint, but when I wrote those words, in 2009, presuming 1 billion smartphones by 2016 was quite the leap of faith.

One of several predictions on my 2016 list was:

At least one major candidate for President of at least one (of the two) major political parties will take the public position that America should 'cancel' its debt to China. [6 Feb 2010]

Today, Business Insider takes noted bank analyst, Chris Walen, to task for suggesting that America  default on its debt.

Fair enough. They will come around. I have no doubt about that. Not simply because our debt is a noose around our economy, our future, our preferred lifestyle. But that whole TARP thing? The bank bailouts? The revolving door between Wall Street executive suites and the Obama White House all taught us one thing. Taught the rest of the world, too, if they were paying attention:

At the end of the day, Americans are okay with walking away from their debts.

I'm open minded. And on this site, you have near free reign to offer solutions, any solutions. Because I'm telling you, that if we improve our schools by, say, 35%, if such could be measured, we'd still have fewer smart people and fewer really smart people than China, I'm guessing.

Work harder? Possibly. I do see a bunch of lazy people. Of course, if we break our backs and give up our lives for our job, there's doubtless a minimum of 420 million more Chinese ready and willing to do the same. One thing for damn sure, we won't compete on wages.

From the US Bureau of Labor Statistics:

As measured in U.S. dollars, Chinese hourly labor compensation costs in manufacturing were roughly 4 percent of those in the United States and about 3 percent of those in the Euro Area in 2008.

For each $100 in compensation an American factory worker earns, in China it's $4. Can't really compete with that.

My thoughts: Radically increase the number of educated immigrants we allow (and allow to stay) in this country. No amnesty for illegals but increase the number of Latin Americans legally allowed into the country every year. Reward them (and those already here) who move to and live in sparsely populated older industrial cities. Create a national very low cost wireless infrastructure at least as good as 4G everywhere. Make the first two years of college free. Give a near free-pass to non-traditional, non-government, non-union learning institutions. Slap a tax onto every single item that comes from China, from dead fish, iPhones and WalMart dishes. Become very good friends, neighbors, protectors of Japan, South Korea, the Philippines, Indonesia and even Russia and India as a means of boxing in China and encouraging growth elsewhere.

Your ideas?

Shocking chart out of the New York Times:

The red line shows what share of personal income comes from wages — that is, what Americans earn from working. The blue line shows what share comes from http://cdn.apture.com/media/imgs/link_icons.gif?v12) !important; background-position: 100% -448px; background-repeat: no-repeat no-repeat !important; margin: 0px !important; border: 0px !important initial !important initial !important;"> transfer payments, which are made to individuals, usually by the federal government, through social benefit programs like unemployment insurance, disability insurance and Social Security. (Note that the two lines use different scales, shown on the vertical axes, and that the scale for wages does not start at zero.)

As you can see, the share of income that Americans earn by working has been falling, from more than two-thirds of their income in the mid-1950s to just over half of their income today. Meanwhile, they have been growing more and more dependent on money from social benefits programs, growing from about 4 percent in the mid-’50s to about 18 percent in February 2011.

As America's economy, like the rest of the planet's, undergoes a fundamanetal restructuring, and money shifts to all things digital, there should be no doubt that more and more will rely upon the government for at least short-term help. 

The biggest factor, of course, are baby boomers. There's lots of them, they have, as a group, known no lifestyle other than the best in the history of the world, and as they age they both demand (and require) more government services and are certain in their belief that they have "earned" and "paid for" these services (e.g. Medicare, Social Security).

This is false, of course, though that's not relevant. What it means is that non boomers will likewise have to throw themselves into the government mix and demand their share. Regardless of party affiliation, you should expect government, as a percentage of GDP, to continue to rise for at least another 10-20 years. Longer if the boomers hold onto life (and power) more than expected.

Damn, does no one in Nevada know when to hold em, when to fold em? Michigan can at least blame the slow-rapid death of the auto industry for its housing plight. Understand. I sympathize. Really. But I still have to shake my head at some of these foolish decisions people were making.