We Can’t Say He Didn’t Warn Us… The Afterburner Economy and A Healing Nation…The End of the PC and the Browser versus the App….Channeling Steve

September 17, 2012

“A republic, madam, if you can keep it.”

Benjamin Franklin

Signer of the Constitution, responding to an inquiry by a  woman outside Independence Hall

as to what type of government the Constitutional Convention had produced.

Monday, September 17 is the 225th anniversary of  the signing

of the United States Constitution!!

We Can’t Say He Didn’t Warn Us

If dictionaries were updated in real time, investors in Facebook looking up the word “fiasco” might find next to the definition a picture of their newly minted stock certificates in the social media giant.  But should these investors really be surprised about the stock’s devastating performance?  After all, Facebook founder Mark Zuckerberg did tell us in the offering prospectus and an accompanying letter  exactly what investors should expect from him, Facebook and by extension their investment .

Henry, Blodgett, Wall Street Superstar Analyst during the Internet Bubble looks at both of these documents in a brief analysis and provides his own running comments in blue throughout the article..  Read the latter first and then go back and read the documents if you have interest. We can’t say he didn’t warn us! 

Econ Recon:  The Afterburner Economy…..and  A Healing Nation

The Afterburner Economy:  In a jet fighter,  the pilot can use an afterburner for a temporary boost of power to accelerate the plane.  Basically, this involves forgoing the usual combustible mix of fuel and air driving a turbine and instead dumping the fuel directly into the exhaust stream where it essentially explodes creating a significant, but temporary surge of thrust.

Fed Chairman Bernanke may have done the same thing this week with yet a third round of quantitative easing (QE3)  in the amount of $40 billion per month of additional money creation for the foreseeable future, intending to hold down interest rates until 2015. Economist Brian Wesbury looks at both the short term and long term effects of this move in his most recent  seven minute Wesbury 101 video.

A Healing Nation:  Vistage Staff Economist and Principal of the Institute for Trend Research Alan Beaulieu writes this week that due to rising home prices and home sales that “we are definitely on our way to restoring equity to homeowners.”  As the housing market improves, he suggests a sound move for your 20-something kids that are just getting started.

The End of the PC…and the Browser versus the App

One of the best IT websites for the non-technical executive is All Things Digital which features great articles and reviews by Walt Mossberg and other members of the WSJ Technology staff. Two current articles in particular deserve your attention.   First, in last week’s email to you I shared the story of a CEO who gave up his PC for a tablet for a year.  This week’s article “It’s Official, the Era of the Personal Computer is Over”  delves further into this phenomenon which seems to be accelerating,  especially when one looks at where all the DRAM memory chips are being used, specifically in tablets and smart phones.

 The second article explores a related trend, namely that the internet is being increasingly accessed through mobile devices instead of computers and through browsers instead of apps  (despite the success of Apple).   These trends will affect how your company uses the internet for marketing and your IT spend. Check out this overview of how “The Mobile Browser Dominates in Emerging Markets” for more info.  These articles will help you understand these important trends that are already well established overseas and are rapidly making their way here.

Channeling Steve

The passing of Steve Jobs a few months ago produced no end of articles reflecting on his influence on the technology we use every day.  In addition to the articles, several cartoons reflecting on his contributions have appeared in the major media.   A few of them appear below.  I think he would have found them amusing and touching.  I hope you do too.