Coning this Fall – the end of credit cards?

 Leather Wallet

 

Apple’s e-wallet could debut as soon as this fall, possibly with ‘iPhone 6′
[Via AppleInsider]

A report on Wednesday claims Apple is accelerating work on a mobile payments system, or digital wallet, that could be ready by this fall, allowing customers to pay for physical goods with their iPhone instead of a credit card or cash.

[More]

I’ve written before about how Apple will change the whole idea of a credit card transaction, through the use of an iPhone and iBeacons. And how Apple made some basic changes in its networking protocols to sent encrypted data.

Now it looks like it might come here this Fall. Never have to remove your credit card. Use your iPhone to transit all the necessary data and encrpted for protection. Now you don’t have to worry about a waiter running your card twice, or copying the number or using their own software to copy the card.

In fact, with an iWatch, you might not even need to remove your iPhone from your pocket.

So now think if Apple receives a small percentage of every Visa transaction? Thiunk that might enhance their bottom line?

If I had spare money, I;d be buying Apple stock.

Making a better world = Separating Sheep from Goats

Ellis Island

The parable of the sheep and goats – to me, one of the defining Biblical passages describing the underlying principles of Christ’s teachings. (with the Sermon on the Mount being the other major one).

As I have written before:

Whether it is the New Commandment to love one another, the Second Great Commandment to love our neighbors, turning the other cheek in response to evil, or how to love one’s enemies, His teachings show a path that breaks cycles of violence that often reverberate during times of change and strife.

This parable catalogs some of the actions that can be taken by those following his teachings – the sheep. It details how they separate themselves by how they treat others.

Seeing a person in difficulty, having compassion and acting to remedy that difficulty is one of the defining teachings that Christ provided.

They are about how to treat other humans, how compassion is required. Empathy and sympathy are what constantly drive successful societies and simply slow down cultures doomed to failure.

Time for us all to be separated – so many goats and so few sheep. From Matthew 25:

31 When the Son of man shall come in his glory, and all the holy angels with him, then shall he sit upon the throne of his glory:

32 And before him shall be gathered all nations: and he shall separate them one from another, as a shepherd divideth his sheep from the goats:

33 And he shall set the sheep on his right hand, but the goats on the left.

34 Then shall the King say unto them on his right hand, Come, ye blessed of my Father, inherit the kingdom prepared for you from the foundation of the world:

35 For I was an hungred, and ye gave me meat: I was thirsty, and ye gave me drink: I was a stranger, and ye took me in:

36 Naked, and ye clothed me: I was sick, and ye visited me: I was in prison, and ye came unto me.

37 Then shall the righteous answer him, saying, Lord, when saw we thee an hungred, and fed thee? or thirsty, and gave thee drink?

38 When saw we thee a stranger, and took thee in? or naked, and clothed thee?

39 Or when saw we thee sick, or in prison, and came unto thee?

40 And the King shall answer and say unto them, Verily I say unto you, Inasmuch as ye have done it unto one of the least of these my brethren, ye have done it unto me.

41 Then shall he say also unto them on the left hand, Depart from me, ye cursed, into everlasting fire, prepared for the devil and his angels:

42 For I was an hungred, and ye gave me no meat: I was thirsty, and ye gave me no drink:

43 I was a stranger, and ye took me not in: naked, and ye clothed me not: sick, and in prison, and ye visited me not.

44 Then shall they also answer him, saying, Lord, when saw we thee an hungred, or athirst, or a stranger, or naked, or sick, or in prison, and did not minister unto thee?

45 Then shall he answer them, saying, Verily I say unto you, Inasmuch as ye did it not to one of the least of these, ye did it not to me.

46 And these shall go away into everlasting punishment: but the righteous into life eternal.

The “outsourcing” of Chinese jobs to robots begins in earnest

Tesla Autobots 

10,000 robots to help assemble Apple’s iPhone 6; robots expected to impact low-skilled workers worldwide
[Via MacDailyNews]

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“Foxconn parent company Hon Hai is set to deploy an army of 10,000 assembly-line robots to help meet the demands of producing the highly anticipated iPhone 6,” Reilly Dowd reports for The Fiscal Times. “Hon Hai CEO Terry Gou revealed in a recent shareholder meeting that Apple would be the very first customer of Foxconn’s latest robots.”

“‘Robots are going to enhance and speed up the manufacturing process,’ said Tim Bajarin, CEO of market research firm Creative Strategies. ‘The really big issue here is that the demand for the iPhone continues to grow. It’s grown every quarter since it came out,’” Dowd reports. “From a business standpoint, it makes sense. ‘When you are dealing with creating millions of smart phones per month, efficiency is critical,’ said Bajarin in an interview. ‘Robotics gives you that level of efficiency, which in the end, is very important for the bottom line.’”

[More]

This is only 10,000. But they work 27/7 with no need to eat or take breaks. As the use of these expands, expect to see many of Foxconn’s 1.3 million employees be put out of work. No more relatively high-paying jobs  for people with limited technological skills (ie not programmers).

Many manufacturing jobs in the US were moved to China because human labor was cheaper. What happens when robotic labor destroys those jobs?

The average person willnot have many options for living a middle class life.

Climate change might help some plants but it also helps some plant diseases

Soybean Sky

Climate change provides good growing conditions for charcoal rot in soybeans
[Via Eureka! Science News - Popular science news]

With over 100 diseases that can attack soybean crops, why would charcoal rot rise to the top of the most wanted list? University of Illinois scientists cite the earth’s changing climate as one reason that more research is needed on the fungus that causes charcoal rot.

[More]

One of the arguments from denialists is that climate change will not be so bad because plants like carbon dioxide. While this is debatable, what is not often discussed is how much better some plant diseases will do.

Here we have a fungus that likes warm, dry weather. And that also infects 500 other plants, including corn and sorghum, besides soybeans. And it loves salty conditions.

So a resistant plant must be one that is heat-, drought -, and salt-tolerant in order to beat the fungus.

Also, in contrast to other disease, charcoal rot not only kills the plant, it lives off the dead tissue. So, it can thrive living off the leftovers from other pathogens that can only use living plants.

At the moment, no soybean plant is completely immune to this fungus. So these researchers are trying to develop varieties that are able to fight off the fungus.

But those varieties also still need to be highly productive. Not an easy task.

It could happen: “Next on Fox – Start-up Battlefield”

Little Bighorn Battlefield National Monument II

[Via Dave Winer's linkblog feed]

The whole idea of a battlefield for startups is ridiculous. Have a love-in for startups. A be-in.

[More]

Gack! It’s like making starting up a company into a reality show.

I agree with Dave Winer.

Make it a win-win proposition not a zero sum. That is the 21st century approach.

The company has to destroy itself, in order to save itself

Mac Keyboard 

Apple: Lessons in Self-Destruction. Richard Gutjahr’s blog
[Via asymco]

My thanks to Richard Gutjahr for taking time to talk about self-disruption. I met Richard as the Master of Ceremonies at the Censhare FutureDays event in Munich. He interviewed me for his blog and posted the results as a video and sound file. Richard is a journalist (Berliner Tagesspiegel, Frankfurter Allgemeine Zeitung) and TV personality (news presenter for Rundschau night).

Horace and I have met at a conference in Germany a few weeks ago. During a break, we were talking about the future of Apple. Horace made a statement, which I found quite intriguing: In order to remain innovative, it is not enough to reinvent yourself again and again. Apple must be the one to destroy its own business.

Hour-long conversation including audio and video: Apple: Lessons in Self-Destruction.

[More]

“In order to remain innovative, it is not enough to reinvent yourself again and again. Apple must be the one to destroy its own business.”

That is what a 21st century company has to do. Google keeps re-inventing itself. Apple tries to destroy itself. The Mac destroyed the Apple II. The iPod destroyed the Mac. The iPhone destroyed the iPod.

What will destroy the iPhone?

(And by destroy, I don’t mean make vanish. Just toppled as the company’s lead money maker.)

Your iPhone will make a better, more secure wallet than your wallet

 iPhone 5S

Mobile money services on the rise worldwide as Apple eyes Touch ID payment system
[Via AppleInsider]

If Apple is able to drive adoption of its rumored iTunes-backed mobile payment system among wealthy consumers at the same pace as similar systems in the developing world, it could be one of the company’s most important — and profitable — strategic moves.

[More]

I’ve written about the effect the iPhone will have on credit cards before. I think this will be a key aspect of the new iPhone coming out (Apple will have had over a year to work out all the needed aspects of TouchId).

You iPhone will be more secure than the wallet you have. Only Apple will have the secure enclave that protects your data. Even losing your iPhone will not allow anyone access to the credit card numbers, like losing your wallet.

Combine this with iBeacons and Apple will control it all. I would not be surprised to see Google and the DOJ  go after Apple in a few years for their emerging monopoly in this area ;-)

Adam Smith knew that higher wages result in harder working employees

 Adam Smith

 

Adam Smith on How to Make the Working Class Happier and More Productive: Pay Them More
[Via Grasping Reality with Both Hands: Economist Brad DeLong's Fair, Balanced, and Reality-Based Semi-Daily Journal]

Adam Smith:Smith: Wealth of Nations, Book I, Chapter 8: “The liberal reward of labour…

…as it encourages the propagation, so it increases the industry of the common people…. A plentiful subsistence increases the bodily strength of the labourer, and the comfortable hope of bettering his condition, and of ending his days perhaps in ease and plenty, animates him to exert that strength to the utmost. Where wages are high, accordingly, we shall always find the workmen more active, diligent, and expeditious, than where they are low; in England, for example, than in Scotland; in the neighbourhood of great towns, than in remote country places. Some workmen, indeed, when they can earn in four days what will maintain them through the week, will be idle the other three. This, however, is by no means the case with the greater part.

Workmen, on the contrary, when they are liberally paid by the piece, are very apt to over-work themselves, and to ruin their health and constitution in a few years. A carpenter in London, and in some other places, is not supposed to last in his utmost vigour above eight years. Something of the same kind happens in many other trades, in which the workmen are paid by the piece; as they generally are in manufactures, and even in country labour, wherever wages are higher than ordinary. Almost every class of artificers is subject to some peculiar infirmity occasioned by excessive application to their peculiar species of work. Ramuzzini, an eminent Italian physician, has written a particular book concerning such diseases….

[More]

He then went on to say that capitalists should moderate the working conditions of their laborers, rather than working  them to death. Better to make a little less during the good years in order to make more during the lean.

The Wealth of Nations does not really say what so many say it does. But then Smith was sure things would be run my moral and ethical people.

“Nice online store you got here. Be a shame for it to disappear from search rankings.”

DSCF0012 

Before Google penalized eBay’s search standing, eBay authored a study claiming Google Search ads are useless
[Via PandoDaily]

Before Google penalized eBay’s search standing, eBay authored a study claiming Google Search ads are useless

[More]

Two things: it appears that Google Ads provide little of value; and, it you point that out, Google appears to do the equivalent of ‘burning down the house’ in order require the use of ads, even if they provide no value. It changes its ranking algorithm to remove your links from the top searches.

Looks like buying Google Ads is more a form of tribute than a benefit. Google gets paid in order to keep an online company’s search rankings high. A zero-sum approach rather than a win-win.

So besides grabbing all our data to sell without recompense, Google requires tribute from online companies. More and more they are degrading the usefulness of their main purpose to exist – search. I routinely now get highly ranked pages that do not have my search terms anywhere on the page. Totally useless.

Perhaps time to check out Duck, Duck, Go.

Would an iPhone have prevented PF Chang’s problem?

 Wallet and some money on a wooden table

 

P.F. Chang’s Security Update
[Via PF Changs]

STATEMENT FROM RICK FEDERICO CEO OF P.F. CHANG’S JUNE 12, 2014

Scottsdale, Ariz. (June 12, 2014) — On Tuesday, June 10, P.F. Chang’s learned of a security compromise that involves credit and debit card data reportedly stolen from some of our restaurants. Immediately, we initiated an investigation with the United States Secret Service and a team of third-party forensics experts to understand the nature and scope of the incident, and while the investigation is still ongoing, we have concluded that data has been compromised.

At P.F. Chang’s, the safety and security of our guests’ payment information is a top priority. Therefore, we have moved to a manual credit card imprinting system for all P.F. Chang’s China Bistro branded restaurants located in the continental United States. This ensures our guests can still use their credit and debit cards safely in our restaurants as our investigation continues.

[More]

Maybe something I wrote about  last year will provide a path to a solution that we can use on our own. It involves an iPhone, Touch ID, and iBeacons.

The attack on PF Chang’s looks very similar to what happened at Michael’s and Target – a store employee at some point put specific malware on a store’s computerized computer terminal, hidden from view.

This software collected unencrypted card information and sent it to the hackers. It is a simple variety of a sort of man-in-the-middle hack. They sit in the middle of all the communications between the store’s computer terminal and the credit card companies.

It can be hard to prevent this with thousands of people having access to the terminals. It is really little different from our viewpoint than the old days when a dishonest clerk would run the card twice in order to get  a copy of the relevant information.

Just safer today for the dishonest employee. Let the computer do all the work.

One easy around this is to use encrypted smart cards. The credit card companies have been slow to do this in the US on their own. 

But here is what I said Apple may be able to do, using the security of the newest iPhones to create a digital wallet:

Imagine you are at a restaurant and read to leave. You take your iPhone and hit the home button. The restaurant uses an iBeacon to send the bill to your iPhone. You hit pay and the credit card transaction is completed – assuming proper security can be created here.

No need to wait for the waiter.

All the pieces are in place for this. Apple has spent a year making sure of this, especially the security issues.

In particular, I would bet there will be an additional need to provide a fingerprint to pay the bill. Much better than any other sort of validation currently used for credit card transactions.

All transactions will be encrypted end-to-end and totally in our control. Much, much harder for hackers to get anything.

Can you imagine the selling point for any restaurant on this? Secure transactions. They never see the actual transactions, just confirmation it happened. 

And Apple’s digital wallet will be much safer than carrying credit cards in our pockets, where they can easily be stolen. We only find out someone has the cards when mysterious transactions appear.

We all now pretty fast when an iPhone is gone. With TouchID, there is little chance anyone will be able to even get into the iPhone at all, much less the credit card numbers, which are encrypted in a secure enclave on the iPhone.

Even if somehow in the future they figure out a way, it will take time. We can easily inactivate the phone in the meantime,

It is coming. Just not soon enough for PF Chang’s

Henry Ford knew how to solve the Capitalist’s Dilemma

 1930 Ford (Model A) De Luxe Fordor Saloon Ad (England)

Henry Ford’s Capitalism
[Via danielmiessler.com]

Ford argued that high wages were essential for economic and moral reasons. As he wrote in his autobiography: What good is industry if it be so unskillfully managed as not to return a living to everyone concerned? No question is more important than that of wages — most of the people of the country live on wages. The scale of their living — the rate of their wages — determines the prosperity of the country. 

[More]

Christensen’s new work, The Capitalist’s Dilemma, is fascinating. Capital today is not doing the good for society that it once did – because capitalists are acting as though capital was scarce.

Here we see that Ford recognized that the purpose of capital was to create new markets and enrich society, not just the capitalist.

The Capitalist’s Dilemma – too much money and no idea of how to use it

 Engagement Ring Luxury Tax Monopoly

 

Who Solved the Capitalist’s Dilemma?
[Via asymco]

In The Capitalist’s Dilemma, Clayton Christensen and Derek van Bever introduce a powerful new theory which explains the relative paucity of growth in developed economies. They draw a causal relationship between the mis-application of capital in pursuit of innovation and the failure to grow.[1]

In particular, they observe that capital is allocated toward the type of innovations which increase efficiency or performance and not toward those which create markets (and hence long term growth and jobs.) This itself is caused by a prioritization and rewarding of performance ratios rather than cash flows and that itself is due  to a perversion of the purpose of the firm.[2]

For this statement of causality to be confirmed we need to observe whether it predicts measurable phenomena. For instance, we need to see whether companies which create markets apply capital toward market-creating innovations and whether companies which create value through efficiencies or performance improvements hoard abundant capital.

Over the entire global economy, the pattern of capital over-abundance is easy to see. The amount of cash or securities on balance sheets is extraordinary and unprecedented (estimated at $7 Trillion, doubling over a decade). However, growing cash is not a perfect indicator of inactivity. Cash is the by-product of earnings after investment. So if operating profits are growing and investment is growing, but not as fast, then it’s possible to grow cash while still growing investment.

[More]

Sure to be a classic. The data sure seem to support their theory – that capital is no longer a scarce resource and capitalists had better realize this. But they continue to use false narratives and metrics to underutilize capital while lining their pockets. As Adam Smith first discussed, capital is supposed to be used to enhance the wealth of nations, of society, not just to enhance the wealth of capitalists..

From the article by Christensen:

In our view the crux of the problem is that investments in different types of innovation affect economies (and companies) in very different ways—but are evaluated using the same (flawed) metrics. Specifically, financial markets—and companies themselves—use assessment metrics that make innovations that eliminate jobs more attractive than those that create jobs. We’ll argue that the reliance on those metrics is based on the outdated assumption that capital is, in George Gilder’s language, a “scarce resource” that should be conserved at all costs. But, as we will explain further, capital is no longer in short supply—witness the $1.6 trillion in cash on corporate balance sheets—and, if companies want to maximize returns on it, they must stop behaving as if it were. 

This partly results in the income disparities we see. It also means that the economy is not as strong as it should be, that people are not being hired at the rates they should and that the world is in much worse shape.

Rentseeking – money making money – was abhorred by Adam Smith. Market-creation – money producing new markets – is pretty much what capitalism is supposed to bring into existence.

But too many companies think they can make more money by rent-seeking approaches.

The asymco article tries to produce a better metric to see which companies are creating markets and which are just holding steady. It is a worthwhile effort but we need better approaches.

Fixing this will not be easy and will be a large part of the battle we fight for the next 15 years or so.

I hate it when scientists are conservative in their models

 antarctica

Doubling of Antarctic ice loss revealed by European satellite | 
[Via Environment | theguardian.com]

Antarctica is shedding 160 billion tonnes a year of ice into the ocean, twice the amount of a few years ago, according to new satellite observations. The ice loss is adding to the rising sea levels driven by climate change and even east Antarctica is now losing ice.

The new revelations follows the announcement last week that the collapse of the western Antarctica ice sheet has already begun and is unstoppable, although it may take many centuries to complete.

[More]

When making estimates or creating models, researchers often error on the conservative side. Knowing the conditional nature od science, they would rather be a little right than a lot wrong.

Yet again and again with respect to climate change, we find that they are often much lower with their estimates than reality produces. We see that here.

This new satellite, sent up in 2010, can produce much better data than we have ever had before. And for the entire continent  The amount of ice lost found by the satellite is 100% greater than most of the previous estimates.

The real worrisome thing is that about 13% of the loss has come from East Antarctica. We actually had expected that to see a small increase in ice, not a decrease.

West Antarctica is on an apparent unstoppable collapse which will raise sea levels 6-7 meters. But the huge East Antarctic ice sheet hods a tremendous amount. If it completely melted, sea levels would go up perhaps 60 meters.

This would put Houston completely underwater, Florida would be gone, Philadelphia would be ocean front, Manhattan would be gone, downtown LA would be on the water, San Francisco would be an island, with an inland sound extending from Chico to Fresno.

The Olympic Peninsula would be an island, Seattle would be a small island and Lake Sammamish would be part of Puget Sound. My house would be about half a mile from the new Sound.

Not likely but then, we did not expect the amount of melting seen in West Antarctica. I guess we will know soon.

Changing water use in California through the Sun

The Sun: One Year in One Image 

California drought: Solar desalination plant shows promise 
[Via  - SFGate]

Quietly whirring away in a dusty field in the Central Valley is a shiny solar energy machine that may someday solve many of California’s water problems.

It’s called the WaterFX solar thermal desalination plant, and it has been turning salty, contaminated irrigation runoff into ultra-pure liquid for nearly a year for the Panoche Water and Drainage District. It’s the only solar-driven desalination plant of its kind in the country.

Right now its efforts produce just 14,000 gallons a day. But within a year, WaterFX intends to begin expanding that one small startup plant into a sprawling collection of 36 machines that together can pump out 2 million gallons of purified water daily.

Within about five years, WaterFX company co-founder Aaron Mandell hopes to be processing 10 times that amount throughout the San Joaquin Valley. And here’s the part that gets the farmers who buy his water most excited: His solar desalination plant produces water that costs about a quarter of what more conventionally desalinated water costs: $450 an acre-foot versus $2,000 an acre-foot.

[More]

In a wet year, the costs are $300 an acre-foot. And much higher in dry years. If they can accomplish their business plan, they could not only change water usage in the Valley but make a ton of money.

Something to watch for. as this can expand to many other areas, allowing us tio essentially recycle the water we use.

Watch Texas as it deals with climate change in order to gain insights

 

Warm Texas wind blows green for Mars
[Via BBC News | Science/Nature | World Edition]

Dire climate change warnings in the US begin to hit home

[More]

The BBC makes the good point that Texas is so large and diverse that it serves as a simpler microcosm of climate change. in the US. Necasue it will likely seemore of it than any other.

Politicians are screaming and denying but individuals are making their own choices.

Politicians rant about needing to stay on coal while companies are moving green by using wind. All in the same state.

The authoritarian hierarchies encompassing politicians and one set of corporations are using every tool to maintain their unsustainable processes while distributed democracies encompassing individuals and another set of corporations are trying to find sustainable processes.

All in one state. The size of Texas means both these processes have ramifications elsewhere.

As with any dynamic equilibrium,things can change very rapidly over a very short period of time. So keep an eye on Texas.

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