Posts Tagged Economy
The Economic Impact because of Technology
The technology has been an indispensable tool for the advancement of humanity. Particularly in the last century with the onset of the industrial era, and now, in our century with the invention of the automobile, the airplane and the computer, the world economy is inconceivable without the support and technology. In the modern economy, the technological factor is the one advocating for change and the most significant cost reduction.
We shall discuss this aspect of technology that we believe the greatest impact in the global economy. This is the information technology and in particular the explosive development of communications networks and their commercial uses.
Although the concept of communication networks appeared in academic circles around the seventies, and who for over twenty years these networks have been used successfully throughout the global scientific community via the Internet, its use was in field specialists. Not until 1992, with the appearance of “WWW” (World Wide Web), a new tool that integrates and greatly facilitates the use of network services, that growth in Internet use becomes explosive.
The “WWW” is an integrated information service in a friendly and graphically, allows navigation through pages, or units of multimedia information (text, image, video and voice), installed in the various computers that make the Internet.
The trend towards the use of networks and the ability to send messages by electronic means in just moments, it tends to integrate existing services with mail, phone, fax and television, as one can, in real time, communicate with another person , and send voice and image, and even accompany documents. Newspapers are already on the Internet and is not far distant day when one can schedule your TV and its own news through the network.
The most widely used service on networks today is email, which allows the exchange of voice, images and text almost instantly, depending on the speed of the media involved in the network. The email service is also used as the internal working mechanism of the companies within their Intranets, or closed networks under the same Internet communication protocols, and its use brings significant savings on long distance companies distributed geographically. It is also an excellent tool for the organization of work, coordination of meetings and events, and group discussions.
Another important service is the network file transfer, known as FTP (File Transfer Protocol), whereby it is possible within the network to exchange any type of document you are in an electronic environment. This application facilitates the ebb and flow of changes to a document from a group of users of a company, consortium or economic group.
Perhaps the least used service by the public, but not least, is the remote connection, TELNET. This service enables remote access from a computer to any other connected to the network, if the user has the necessary permit to work in the second. If permissions exist, a person can be connected from a personal computer at home, a supercomputer installed at a million miles away. The process gives the personal computer as if it were a remote terminal supercomputer. This service has a huge interest in a company or workgroup, allowing specialized computing infrastructure sharing among different agencies or branches distant from the same institution.
These new technologies bring with them new ideas on the use of the network and the potential implicit in exchanging information. To take just some examples of what can be new applications, some of which are now a reality and some exist in research laboratories, but are not yet available to the public.
For example, consider the possibility of a mobile society where, from a train, plane, or home, you can trade via networks of information, consult the inventory in an office, issue an order to the supplier and order the bank is made a transfer of money. The supplier in turn may have a computer in the truck and to be dynamically changing routes and delivery routes, according to traffic conditions or last-minute changes requested by the client. These applications are possible thanks to the network, to mobile phones and systematic work around the definition of standards for the electronic transfer of documents.
The electronic document processing has become a necessity in almost all businesses to communicate both internally and to interact with other companies. The electronic exchange of documents allows the transmission of data in structured formats between applications on different computers. This form of exchange of information greatly reduces the transaction time, errors of transcription and the production and management of paper can keep lower inventories online and guarantee the quality of the information provided and the response time to customers. There is a major global effort to generate standards for the electronic exchange of documents is being adopted in almost all countries.
Electronic commerce is one of the latest Internet applications and more growth. Production of documents, inventories and catalogs online is cheaper than printing on paper and can always be current. On the other hand, the potential number of readers is very large and tends to increase exponentially with the growth of the network. This has led many companies are entering the Internet market, especially the provision of services such as travel agents, financial agents or real estate they need to provide its customers dynamic and updated information and graphical evaluation and comparative analysis .
Another interesting example is the interactive manufacturing. Manufacturing has gone global and for many years often find that we have in a factory, assembly and design another in another. Through the computer network, several individuals working in the design of one piece of a car may be interacting in real-time network. For example, someone may propose to design a car part on the network and the person working in the assembly may be doing observations of change, while the corporate staff may be evaluating the costs of such change.
The development of new applications using networks is being strongly supported worldwide. Many projects are funded to develop: digital libraries that make their assets public domain literature, iconographic, sound, etc., And virtual labs that put multiple network service specialized equipment to allow researchers from a group or of an institution, geographically dispersed, work together in real time through the network.
The need for technological advances in the areas of hardware and software are already in sight. Every day new problems to solve related to the use of the network. The concept of individual computer, both physical and logical, is being replaced by the computer as a set of processors networked and distributed systems. Thus the concept of system is changing at all levels by the concept of distributed system. For example, research on databases has shifted to research in distributed databases with multimedia objects, voice, image, text and video, and expert systems are no longer isolated systems to become cooperative and distributed systems, using intelligent agents within the network to communicate.
The construction of tools for browsing networks, search engines and data classification, encryption algorithms and graphical interfaces, intelligent, have assumed an enormous importance on the computer.
The fund manager does not trust Bernanke ?
Bill Tedford is encouraging investors to bet against the statements of the president of the U.S. Federal Reserve, Ben Bernanke, who recently told a group of business leaders in Washington that the “inflation could fall from current levels.”
For over 20 years, Tedford has managed to Stephens Inc., of Arkansas, a bond portfolio that has overcome the major sector indices. And although Bernanke sees some lethargy in the U.S. economy could translate into a reduction of inflation, Tedford said that the general rise in prices in the country is already evident in the Consumer Price Index and up even further in 2010 and 2011 .
The manager and his fund have begun to encourage their customers to invest more in timber, oil, gas, agricultural raw materials and industrial and precious metals. All these commodities have historically been a good bet for rising inflation.
“What is alarming,” says Tedford, “is the possibility that inflation will explode beyond the numbers we are seeing now.”
These days, the debate in the U.S. focuses on whether fiscal policy in Washington has prepared the country for an outbreak of inflation and how severe it was. Tedford is in the group was concerned that all the dollars currently circulating in the economy cause an outbreak of inflation.
In the same group is John Paulson, the hedge fund manager who made billions of dollars by betting that mortgage-backed securities were to collapse. Paulson, who is creating a new investment fund specializing in gold, said a few weeks ago, during an investor conference that the U.S. monetary base, in full explosion, was a harbinger of inflation.
For 20 years, Tedford has managed a portfolio that currently manages U.S. $ 1,250 million, including $ 800 million in U.S. government bonds. During that period, audited performance has exceeded the benchmark U.S. Barclays Intermediate Government Bond Index in periods one, three, five, 10, 15 and 20 years. In the 12 months ended September 30, 2009, performance of 8.87% beat the index by over 2.6 percentage points.
Because it is specialized in U.S. government debt, with virtually zero risk, Tedford’s only concern is the economic policy dictated by Washington and the outlook for inflation. And these days, the model that was based for two decades, insists that inflation has an upward trajectory.
The key insight in the model of the monetary base Tedford is basically the money that circulates in the hands of the public or reserves banks deposit at the Federal Reserve. Over long periods, Tedford said, inflation remains closely in the monetary base increases that exceed economic growth.
For example, he notes, in the 40 years ended in 2007, the U.S. monetary base grew at 7.08% per year. Meanwhile, the GDP grew at 3.04%. The surplus of 4.04% in the monetary base growth that results is very similar to the CPI and the price index for personal expenses, another measure of general inflation.
After the global financial crisis that originated in the U.S., that country’s monetary base ballooned to more than U.S. $ 2 trillion (million million) by the end of November, compared to less than U.S. $ 850 million in August 2008 before the crisis burst, according to Fed data Even if you subtract the more than U.S. $ 1 billion in excess reserves, the country’s monetary base has grown over 11% in the last 15 months. Tedford said that this is one of the changes higher than measured. U.S. GDP during that period shrank by 2%.
“The weight of this significant increase in the monetary base points to a severe inflation in 2010 and 2011,” he adds.
Their model, which “anticipated that the 12-month CPI rose into positive territory in late 2009, will rise from 3% to 4% by the end of 2010 and then will approach 5% or 6% by mid-2011.” And if some of the excess reserves to start filtering into the banking system, as Tedford believes is happening, “inflation could rise even more.”
In fact, the manager says that inflation is already apparent. Although the adjusted annual CPI for October showed a fall in prices of 0.2%, the change from January until the week of December 25 indicates that prices rose more than 2.3%.
Not all economists accept the theory of Tedford. “You can not just look at the monetary base and draw a conclusion about inflation,” said Sung Won Sohn, an economics professor at California State University Channel Islands.
Although the monetary base has risen, Sohn noted that the velocity of money (the rate at which a currency circulating in an economy) has been reduced, meaning that price pressures are low because the money is changing hands more slowly.
It should be noted that the model of Tedford has received his shots. In mid-2004, projected a bout of inflation in response to the decision by the Fed to raise interest rates from 1%. However, the Treasury acted erratically and fell instead of rising, as they had in other times in history.
However, Tedford defends his model, ensuring that it has been very accurate in the past 20 years and is “responsible for our success against the benchmark interest rates.” In his own portfolio, is betting on the fall of Treasuries to 30 years, under the expectation that prices will fall as interest rates rise.