New Focus of Inquiry Into Bribes: Doctors

A long-running federal investigation into the orthopedic device industry’s suspected kickback payments to hip and knee surgeons now has the doctors in the spotlight.

Having reached settlements with the five leading makers of artificial joints last year over the payments, the government has been focusing on the many doctors who receive money as the companies’ paid consultants.

“We are going to be looking at those soliciting kickbacks,” Lewis Morris, the chief counsel in the federal office that pursues civil complaints of Medicare fraud, told an audience of hundreds of doctors, company representatives and investors this month in San Francisco at the annual meeting of the American Academy of Orthopedic Surgeons.

The same message has gone out to health care lawyers attending legal education seminars in recent months and, directly from Christopher J. Christie Jr., the United States attorney in Newark, who is overseeing the investigation. Executives say Mr. Christie has addressed sales meetings of the five companies, which reached a settlement last fall to avoid prosecution on charges they had routinely paid illegal kickbacks to surgeons.

Mr. Christie said “ ‘I’ve dealt with the supply issue, now I need to deal with the demand issue,’ ” recalled Edward B. Lipes, the executive vice president in charge of surgeon relationships at the device maker Stryker Corporation, the first of the companies to cooperate in the investigation, which began in 2005.

Although industry executives say they have heard that some doctors have received subpoenas, none have been publicly identified. “Our investigation is continuing into the conduct of individual surgeons,” Michael Drewniak, the spokesman for the United States attorney’s office in Newark, said Friday.

Mr. Drewniak declined to say whether any of the doctors had become targets of the investigation.

The government has not argued that any of the kickbacks led to unnecessary knee or hip surgery or maltreatment of any patients. Nor has it established a direct link to higher Medicare costs. Switching a patient from one company’s device to another would not change the amount Medicare pays hospitals for an implant.

But kickbacks might raise the overall cost of health care. Doctors can be convicted of violating Medicare’s antifraud statutes simply for submitting a bill for a procedure linked to a kickback, whether or not the procedure was necessary.

Besides Stryker, the original targets of the investigation were Biomet; DePuy Orthopaedics, a unit of the Johnson & Johnson Company; Smith & Nephew; and Zimmer Holdings. Those four agreed to pay $310 million in fines to settle civil charges.

In December, two smaller competitors, the Wright Medical Group and Exactech, received subpoenas, indicating that the government is intent on making sure that the entire major joint business — the $6 billion core of the orthopedics industry — is playing on the same field.

From the government’s perspective, the investigation has already been successful. Even before the settlements with the device makers, those companies and others had sharply curbed entertainment, travel payments and other practices the government regarded as possibly influencing doctor’s medical decisions. And with the settlements, still tighter restrictions were forced on the companies.

To avoid prosecutions that could have threatened the companies’ Medicare business — a crushing blow in a segment of the health care industry where the average patient is 68 years old — the device makers not only agreed to pay the fines but to operate for 18 months under stricter federal scrutiny than military contractors do.

Mr. Christie’s appointed monitors, overseers whom the companies pay monthly retainers plus up to $895 an hour, screen every payment the companies make to doctors who help with training or with developing new products.

Each company is required to develop and gain government approval of a “needs assessment” detailing every task for which it will engage doctors this year. The settlements also set a $500-an-hour ceiling for most consulting agreements.

In addition, all five were required to disclose on their Web sites cash payments last year to each doctor or medical group they dealt with, as well as compensation paid each of them in the form of plane tickets, lodging, food and gifts.

The companies halted nearly all types of payments to doctors and many education programs while completing the needs assessment, including previously pledged support for groups like the American Academy of Orthopedic Surgeons.

Stryker and Smith & Nephew say they have received final approval for their 2008 assessments. Other companies are at various stages of getting their assessments approved.

For all the disclosures and scrutiny though, the details of the misconduct that attracted the Justice Department’s attention remain murky.

The companies were allowed to deny any wrongdoing in the criminal and civil settlements they negotiated. The four that signed so-called delayed prosecution agreements — Biomet, DePuy, Smith & Nephew and Zimmer — have been promised that the criminal cases filed against them in September will be dropped a year from now if they live up to compliance procedures in their agreements.

No charges were filed against Stryker, the fifth company, because it was the first to cooperate in the investigation. But Stryker accepted the same restrictions on its conduct and was also assigned an independent monitor for 18 months. Stryker’s potential civil liabilities were left unresolved.

The five companies’ payment disclosure lists say nothing about what the doctors on them did to receive their money. As a result, there is no apparent way to distinguish potentially questionable kickback deals amid a sea of service contracts, licensing agreements and research grants that the government agrees are legitimate.

The American Academy of Orthopedic Surgeons has said that the listings raise unfair suspicions and that the companies should provide more detailed breakdowns of the payments.

“A lot of this has been irresponsible,” Dr. Thomas M. Coon, a surgeon in Red Bluff, Calif., said of the government’s investigation during a break at the recent meeting in San Francisco.

Dr. Coon said the broad reach of the government’s action had “thrown up in the air” hundreds of company-surgeon relationships. “Who knows how it will come out?” said Dr. Coon, a pioneer in minimally invasive knee surgery, who has consulted principally for Zimmer, the largest hip and knee company.

Dr. Coon declined to say how much he was owed after Zimmer halted payments in October. Zimmer’s disclosure said it paid him $158,420 last year — in addition to $1,944 for air travel, $2,498 for lodging, $1,034 for meals, $440 for ground transportation and $10 for a gift.

Identifying any rogue surgeons could be politically sensitive for Mr. Christie, who has been reported to have aspirations to run for governor of New Jersey. He stirred controversy in Congress for appointing his previous boss, the former United States attorney general, John Ashcroft, to the lucrative job of monitoring the activities of Zimmer, the largest implant company.

“They will probably find somebody to indict, but people are viewing the attorney general’s office with a lot of distrust,” said Dr. Robert H. Schmidt, an orthopedist in Fort Worth.

As indicated by Dr. Coon’s work with Zimmer, financial relationships between orthopedics companies and their customers are among the most complicated in health care. In contrast to drugs, which are typically developed in company laboratories, many orthopedic devices and related tools originate from inventions by doctors, who often retain a financial stake in their market success.

Once companies begin to develop the devices, leading doctors are hired as consultants to help modify the implants and related hardware. When the products are finally brought to market, companies also hire many of the same opinion leaders to train other doctors and sales representatives how to use them.

As a result, Mr. Christie has had no problem finding large sums of money — in some cases, more than $1 million annually — flowing from companies to doctors who use their devices. But doctors say it is far too simplistic to conclude, as Mr. Christie claimed last fall, that “many orthopedic surgeons in this country made decisions predicated on how much money they could make — choosing which device to implant by going to the highest bidder.”

For the most part, the hip and knee joints sold by the major companies are similar in performance, but getting surgeons to switch is a lot more difficult than persuading an internist to prescribe a prescription drug rather than aspirin.

Familiarity with a joint and the tools to put it in place may be the single biggest factor in a surgeon’s success with a patient, according to Dr. Ronald P. Grelsamer, a Brooklyn orthopedist and author of books on hip and knee reconstruction.

“Surgeons are by and large reluctant to jump from one horse to another,” Dr. Grelsamer said.

As a result, surgeons would be looking to whatever cases might be brought against their peers to clarify the lines the government wants drawn between unacceptable and acceptable relationships with the device industry.

Mr. Christie and Mr. Morris, the top lawyer in the Office of the Inspector General in the Department of Health and Human Services, will in turn face tough choices on how many cases to pursue. Complaints against individual doctors rarely have the impact on overall medical practice that cases against large companies or groups of companies do, nor do they produce large financial compensation for the government.

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The Wretched Life of the Insomniac

Last year, I spotted an interesting report about ways to treat insomnia without drugs. I wrote about it and quickly learned how devastating an illness insomnia really is. Hundreds of readers shared their stories of wretched nights awake and a medical community that offered no real answers. Writer Gayle Greene’s new book, “Insomniac,” from the University of California Press, is both memoir and investigation into the world of insomnia. Here is an excerpt. — Tara Parker-Pope

By Gayle Greene

The first thing to go is your sense of humor. Then goes the desire to do the things you used to do, then the desire to do anything at all. Parts of your body ache that you don’t even know the names of, and your eyes forget how to focus. Words you once knew aren’t there anymore, and there’s less and less to say. People you once cared about fall by the way and you let them go, too.

Gayle Greene, dozing off. (Hannah Graves)

Insomnia is a problem most insomniacs don’t want to talk about. In fact, it’s a problem many of us don’t know how to talk about. “Oh, you know, a bad night,’’ I say to a colleague’s “What’s wrong?” on one of my walking-into-walls day. “Why, Gayle, what do you have to lose sleep about? You’ve got no problems,” says my colleague, eyebrows raised. If I’d been up with a bad tooth or a sick child, that’s something he would understand. If I just plain can’t sleep, that’s weird. Anyhow, chronic insomnia is not just ”a bad night.” Chronic insomnia is a bad night that goes on and on.

Look on the Web, read what insomniacs say on Sleepnet.com and Talkaboutsleep.com, and you’ll find stories of lives wrecked by this affliction, marriages ruined, educations abandoned, jobs lost, careers destroyed. We reach for metaphors, analogies, figures of speech to say what it’s like. “It’s like someone opened a tap at the bottom of your body and just tapped out all the blood, and it’s just gone, there’s nothing left.” “It’s like I’m wasting away, slipping away, losin’ it.’’

Insomnia has been with us as long as we’ve had language. Ancient Egyptian hieroglyphs record a lament for “three living hells,’’ one of which is “to be in bed and sleep not.’’ Insomnia may come with the territory of being human, but it has, for a variety of reasons, become the plague of modern times. Surveys indicate that about a third of the American population suffers with it enough to complain about it, and that as many as 10 to 15 percent have it chronically. Among the poor, the female and the elderly, the incidence is much higher — in people over 65, estimates are as high as 60 percent. Since there are no outward and apparent signs for what we have, no wounds, scars, crutches, casts, wheelchairs, this is an invisible epidemic.

Insomnia is not seen, and it’s certainly not heard, since insomniacs are not speaking out. “Insomniacs are seen as neurotics who should have more willpower,’’ says Stanford researcher Richard Coleman. “Knowing that they’ll be granted little sympathy if they mention some of their miserable daytime symptoms…or ask for sick leave, insomniacs tend to keep their sleep complaints to themselves.’’

Friends and family weigh in with advice. “A little warm milk — puts you right out.’’ Or, “A shot of whiskey does the trick.’’ “A hot bath…” “A big plate of pasta…” “Have you tried melatonin?”

“If there’s any illness for which people offer many remedies,’’ says a character in Anton Chekhov’s “The Cherry Orchard,” “you may be sure that particular illness is incurable.’’…

In one of his stand-up routines, British comedian David Baddiel asks why, when people hear he’s an insomniac, they say, “Really? ‘Cos I fall asleep the second my head hits the pillow.” He adds, “When I see someone in a wheelchair, I don’t say, “Really? ‘Cos I can do this…” and he hops around the stage on one leg. …

Sleep is personal, sleep is intimate, sleep is interwoven into the fabric of our deepest beings. It’s not surprising, then, that we have relations to sleep that are as individual and distinctive as we ourselves are.

You must find your own way with insomnia, make your own terms with it, learn what works for you and what does not. Become a close observer of your sleep, which does not mean obsessing about your sleep, but learning your body, how it reacts to foods, drugs, light, time of day. Cobble together from what you learn a way of life that works. There is no “program” that is right for everybody. There is only what you can find that works.

I don’t use the word manage with insomnia, though people like this word. I don’t manage this beast. I live with it. I live around it. I bed down with it every night, gingerly, cautiously, careful not to provoke it. I do my best to placate it, domesticate it, dull its claws, avoid its fangs, knowing that at any moment it can pounce on me and tear me to bits. But manage it? I wouldn’t say so.

Gayle Greene is professor of literature and women’s studies at Scripps College in Claremont, Calif., and a patient representative on the board of the American Insomnia Association. See www.sleepstarved.org for an ongoing discussion of insomnia issues. Tara Parker-Pope is on vacation.

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Roman Abramovich opens luxury hospital for millionaires in Moscow

A hospital for millionaires opened in Moscow. It became the first-ever hospital of the kind that has ever been organized in Russia. The hospital is located in the north-west of Russia’s capital, close to the so-called reservation of millionaires, known as Rublyovka. The hospital is capable of servicing up to 50 VIP patients at a time. Roman Abramovich’s company, Millhouse LLC, acted as the project investor.

Artyom Tolokonin, an author of the project, said that the creation of such a medical institution would allow to render first class medical services in Russia, which are now available only in several privately owned hospitals of Western Europe and the USA. The Moscow VIP hospital hopes to become a competition at this point, attracting not only wealthy Russians, but Western millionaires too.

The servicing program for one year will cost about 1.5 million rubles ($62,500). Investments in the implementation of the project make up about $10 million.

The hospital for millionaires will distinguish greatly from the vast majority of Russian hospitals. Most of them still use the outdated equipment of the 1970s.

The clinic will become another addition to Roman Abramovich’s extensive list of property. He currently owns five yachts – the fleet, which the media called “Abramovich’s Navy.”

He owns a private Boeing 767-33A/ER, known as "The Bandit" due to its cockpit area paint detail. Originally the aircraft was ordered by Hawaiian Airlines but the order was cancelled and Abramovich had it refitted to his own requirements. The Boeing 767 replaces a smaller Boeing 737-7CG BBJ. Abramovich also owns Eurocopter helicopters based on his yachts, Blackbushe airport or at his home near Rogate in Sussex, England.

As of early 2007 he has been using a smaller aircraft for his European travels. The Austrian-registered Dassault Falcon 900 registration OE-IDX is instantly recognizable by the livery similar to P4-MES.

In 2004 Abramovich bought two Maybach 62 limousines. He had these customized to be bomb proof and have bullet-proof glass. They were reported to have cost him £1 million. In September 2007, the French newspaper Le Figaro incorrectly claimed that Abramovich was the previously unidentified customer for the first private Airbus A380 Superjumbo. At the 2007 Dubai Air Show it was revealed that the jet was in fact ordered by Prince Al-Walid bin Talal, the CEO of Kingdom Holdings.

Prepared by Dmitry Sudakov
Pravda.ru

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Public Health Risk Seen as Parents Reject Vaccines

Parents like Linda Palmer, left, Julie Chiariello and Sybil Carlson believe vaccines are dangerous.

SAN DIEGO — In a highly unusual outbreak of measles here last month, 12 children fell ill; nine of them had not been inoculated against the virus because their parents objected, and the other three were too young to receive vaccines.

The parents who objected to their children being inoculated are among a small but growing number of vaccine skeptics in California and other states who take advantage of exemptions to laws requiring vaccinations for school-age children.

The exemptions have been growing since the early 1990s at a rate that many epidemiologists, public health officials and physicians find disturbing.

Children who are not vaccinated are unnecessarily susceptible to serious illnesses, they say, but also present a danger to children who have had their shots — the measles vaccine, for instance, is only 95 percent effective — and to those children too young to receive certain vaccines.

Measles, almost wholly eradicated in the United States through vaccines, can cause pneumonia and brain swelling, which in rare cases can lead to death. The measles outbreak here alarmed public health officials, sickened babies and sent one child to the hospital.

Every state allows medical exemptions, and most permit exemptions based on religious practices. But an increasing number of the vaccine skeptics belong to a different group — those who object to the inoculations because of their personal beliefs, often related to an unproven notion that vaccines are linked to autism and other disorders.

Twenty states, including California, Ohio and Texas, allow some kind of personal exemption, according to a tally by the Johns Hopkins University.

“I refuse to sacrifice my children for the greater good,” said Sybil Carlson, whose 6-year-old son goes to school with several of the children hit by the measles outbreak here. The boy is immunized against some diseases but not measles, Ms. Carlson said, while his 3-year-old brother has had just one shot, protecting him against meningitis.

“When I began to read about vaccines and how they work,” she said, “I saw medical studies, not given to use by the mainstream media, connecting them with neurological disorders, asthma and immunology.”

Ms. Carlson said she understood what was at stake. “I cannot deny that my child can put someone else at risk,” she said.

In 1991, less than 1 percent of children in the states with personal-belief exemptions went without vaccines based on the exemption; by 2004, the most recent year for which data are available, the percentage had increased to 2.54 percent, said Saad B. Omer, an assistant scientist at the Johns Hopkins Bloomberg School of Public Health.

While nationwide over 90 percent of children old enough to receive vaccines get them, the number of exemptions worries many health officials and experts. They say that vaccines have saved countless lives, and that personal-belief exemptions are potentially dangerous and bad public policy because they are not based on sound science.

“If you have clusters of exemptions, you increase the risk of exposing everyone in the community,” said Dr. Omer, who has extensively studied disease outbreaks and vaccines.

It is the absence, or close to it, of some illnesses in the United States that keep some parents from opting for the shots. Worldwide, 242,000 children a year die from measles, but it used to be near one million. The deaths have dropped because of vaccination, a 68 percent decrease from 2000 to 2006.

“The very success of immunizations has turned out to be an Achilles’ heel,” said Dr. Mark Sawyer, a pediatrician and infectious disease specialist at Rady Children’s Hospital in San Diego. “Most of these parents have never seen measles, and don’t realize it could be a bad disease so they turn their concerns to unfounded risks. They do not perceive risk of the disease but perceive risk of the vaccine.”

Dr. Sawyer and the vast majority of pediatricians believe strongly that vaccinations are the cornerstone of sound public health. Many doctors view the so-called exempters as parasites, of a sort, benefiting from the otherwise inoculated majority.

Most children get immunized to measles from a combined measles, mumps and rubella vaccine, a live virus.

While the picture of an unvaccinated child was once that of the offspring of poor and uneducated parents, “exempters” are often well educated and financially stable, and hold a host of like-minded child-rearing beliefs.

Vaccine skeptics provide differing explanations for their belief that vaccines may cause various illnesses and disorders, including autism.

Recent news that a federal vaccine court agreed to pay the family of an autistic child in Georgia who had an underlying mitochondrial disorder has led some skeptics to speculate that vaccines may worsen such conditions. Again, researchers say there is no evidence to support this thesis.

Alexandra Stewart, director of the Epidemiology of U.S. Immunization Law project at George Washington University, said many of these parents are influenced by misinformation obtained from Web sites that oppose vaccination.

“The autism debate has convinced these parents to refuse vaccines to the detriment of their own children as well as the community,” Ms. Stewart said.

While many parents meet deep resistance and even hostility from pediatricians when they choose to delay, space or reject vaccines, they are often able to find doctors who support their choice.

“I do think vaccines help with the public health and helping prevent the occasional fatality,” said Dr. Bob Sears, the son of the well-known child-care author by the same name, who practices pediatrics in San Clemente. Roughly 20 percent of his patients do not vaccinate, Dr. Sears said, and another 20 percent partially vaccinate.

“I don’t think it is such a critical public health issue that we should force parents into it,” Dr. Sears said. “I don’t lecture the parents or try to change their mind; if they flat out tell me they understand the risks I feel that I should be very respectful of their decision.”

Some parents of unvaccinated children go to great lengths to expose their children to childhood diseases to help them build natural immunities.

In the wake of last month’s outbreak, Linda Palmer considered sending her son to a measles party to contract the virus. Several years ago, the boy, now 12, contracted chicken pox when Ms. Palmer had him attend a gathering of children with that virus.

“It is a very common thing in the natural-health oriented world,” Ms. Palmer said of the parties.

She ultimately decided against the measles party for fear of having her son ostracized if he became ill.

In the late 1960s and 1970s, measles outbreaks in Alaska and California triggered strong enforcement of vaccine mandates by states, and exemption laws followed.

While the laws vary from state to state, most allow children to attend school if their parents agree to keep them home during any outbreak of illnesses prevented by vaccines. The easier it is to get an exemption — some states require barely any paperwork — the more people opt for them, according to Dr. Omer’s research, supported by other vaccine experts.

There are differences within states, too. There tend to be geographic clusters of “exempters” in certain counties or even neighborhoods or schools. According to a 2006 article in The Journal of The American Medical Association, exemption rates of 15 percent to 18 percent have been found in Ashland, Ore., and Vashon, Wash. In California, where the statewide rate is about 1.5 percent, some counties were as high as 10 percent to 19 percent of kindergartners.

In the San Diego measles outbreak, four of the cases, including the first one, came from a single charter school, and 17 children stayed home during the outbreak to avoid contracting the illness.

There is substantial evidence that communities with pools of unvaccinated clusters risk infecting a broad community that includes people who have been inoculated.

For instance, in a 2006 mumps outbreak in Iowa that infected 219 people, the majority of those sickened had been vaccinated. In a 2005 measles outbreak in Indiana, there were 34 cases, including six people who had been vaccinated.

Here in California, six pertussis outbreaks infected 24 people in 2007; only 2 of 24 were documented as having been appropriately immunized.

A surveillance program in the mid ’90s in Canada of infants and preschoolers found that cases of Hib fell to between 8 and 10 cases a year from 550 a year after a vaccine program was begun, and roughly half of those cases were among children whose vaccine failed.

Gardiner Harris contributed reporting from Washington.

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Doctor Blogs Raise Concerns About Patient Privacy

Doctors' blogs offer a glimpse into the medical profession — but could they also compromise patients' privacy? iStockphoto

Morning Edition, March 13, 2008 · Medical blogs have drawn back the curtain on the inner workings of the health care profession. Online readers can learn about the latest medical gadgets, read physicians' views on health care issues, even get a peek at the inner thoughts of surgeons. But despite their attraction, these blogs have raised concerns about privacy issues on the Web.

Take a stroll through any of the 120,000 health care blogs and you can find opinions on everything from popular pharmaceuticals to celebrity skin problems. There are no precise figures on how many doctor blogs are out there, but they are easy to find. One blog called "EM Physician" recounts a scene of gang members turning up at the ER with severe burns. "Aggravated DocSurg" says that operations are "fun," and "Radiology Picture of the Day" shows a range of horrific conditions from brain diseases to a breast implant rupture.

One physician blogger, who draws about 12,000 readers a day, is New Hampshire internist Dr. Kevin Pho. His blog, "Kevin, M.D.," offers a doctor's eye view on medical issues that appeal to both his peers and the public.

"I talk a lot about primary care because there's a myriad of problems that I as a primary care physician face that I want to communicate to the public. I talk about malpractice and how physicians practice defensive medicine to avoid malpractice lawsuits," says Pho. His daily writings have made him something of a celebrity in the blogosphere.

Online Marketing

Blogging can be a great marketing tool for raising a physician's profile and attracting new patients, says health care marketing expert Fard Johnmar.

"Patients who see physicians who blog realize that these physicians understand implicitly that patients are hungry for information. By providing this information sometimes they will become much more trusted by patients because they believe that they are going to be much more responsive," Johnmar says.

But not all physician blogs are geared toward marketing. In fact, just the opposite seems to be the case in some extremely candid blogs, like "White Coat Rants," "Cancer Doc" and "M.D.O.D.," which bills itself as "Random Thoughts from a Few Cantankerous American Physicians." These are more like diaries in which doctors vent about reimbursement rates, difficult cases and what a "bummer" it is to have so many patients die.

Privacy Issues

Dr. Deborah Peel, a psychiatrist and founder of the group Patient Privacy Rights, thinks physician blogs often step too close to the limits of patient privacy.

"The problem with physicians blogging about patients is the danger that that person will be able to identify themselves, or that others that know them will be able to identify them," she says.

Peel's group worries that information about a patient's case could be traced back to the individual and adversely affect his or her employment, health insurance or other aspects of his or her life.

Certainly if a doctor violates a patient's privacy there could be legal consequences. Under the federal Health Insurance Portability and Accountability Act, physicians could face fines or even jail time. In some states, patients can file a civil lawsuit if they believe a doctor has violated their privacy. Still, it's not just privacy issues that trouble Peel.

"If you are unhappy with the people that you're supposed to be serving and taking care of, you probably need therapy," she says. "You don't need to be venting your frustrations in a public manner like that. That's very inappropriate and unprofessional."

Insight and Entertainment

Dr. Robert Wachter, author of a blog called "Wachter's World," disagrees. As a leading expert on patient safety who writes extensively about medical mistakes, he counters, "You might say we as doctors should never be talking about experiences with our patients online or in books or in articles."

He says it's important for doctors to be able to share cases, as long as they change the facts substantially. But he says that's one reason patients shouldn't take all the information on blogs at face value.

Wachter says taken for what they are — unedited opinions, and in some cases entertainment — blogs can give readers some useful insight into the good, the bad and the ugly of the medical profession.

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Colo. city's water is bacteria source

DENVER (AP) -- It could be three more weeks before residents of a southern Colorado town can drink water straight from the tap after dozens of cases of salmonella poisoning were linked to municipal water, putting seven people in the hospital.

An analysis indicates the municipal water system in Alamosa is the source of the bacterial outbreak, as suspected, said Ned Calonge, chief medical officer for the state health department.

Gov. Bill Ritter declared an emergency Friday in Alamosa County, activating the National Guard and providing as much as $300,000 for response efforts.

The city and county have also declared emergencies as officials scrambled to provide safe water and disinfect the system with chlorine.

The earliest the city water system could be flushed is Tuesday, and disinfecting it and making sure it is safe could take many days, said James Martin, executive director of the state health department. Water agencies from Denver, Aurora and Fort Collins were helping.

As of Friday, 138 cases of salmonella linked to the outbreak had been reported in people from infancy to age 89, of which 47 were confirmed by lab testing, Calonge said. The conditions of those hospitalized weren't released.

Alamosa, with about 8,500 residents, gets its water from a deep well system. The water is pure from the aquifer and is not chlorinated.

Investigators are seeking how the system was contaminated. Possibilities include a compromise in a storage tank or cross-contamination with a sewage line, Calonge said.

About 45 businesses are providing enough bottled water to supply residents for several days, in some cases for free, said Hans Kallam, director of the state Division of Emergency Management. Bulk water is also available from East Alamosa, which is not connected to the city system.

Boiling tap water will kill bacteria, but health officials warned that no one should use even boiled tap water once the flushing of the water system begins. People were warned not to give pets tap water, either.

San Luis Valley Regional Medical Center bought in bottled water, and equipment was being sanitized with alcohol, said Chief Operating Officer Henry Garvin.

"It's becoming much more costly to deliver care, but for patient care it's not going to be an issue," Garvin said, who did not have an estimate on the extra costs.

The city had been working to switch to a chlorinated system, but the outbreak is speeding up the timetable, Calonge said.

Only 15 salmonella outbreaks from public water systems were reported from 1971 to 2004, the federal Centers for Disease Control and Prevention said.

Symptoms include diarrhea, fever and stomach cramps that usually go away within a week, although same cases may require hospitalization.

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Coffee Printer makes your cup of joe a beautiful thing

"Could I have some artwork with that cappuccino?" Not exactly something you hear at Starbucks a lot, but if this coffee-printer technology goes mainstream, who knows? Wait, a coffee printer? Yep, Oleskiy Pikalo woke up one day with a hankerin' for some fancy designs on his latte, so he bought a used Philips 8155 x-y flatbed plotter and modified it to shoot out edible ink. The result is a machine that can draw surprisingly detailed art on your cup of joe — and put creative baristas everywhere to shame.

It's doubtful any Starbucks outside of Florence would install one of these suckers, if only for the reason it'll add at least 2 minutes to your order. Still, on a sleepy Sunday afternoon at the Met Museum's cafe, I'd wait the extra time for novelty's sake. Though I'd feel guilty for drinking it.

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The Bare Necessities: A Generation

A few weeks ago I gave a talk on the state of the economy to a group of college students -- almost all Barack Obama enthusiasts -- who were griping about how downright awful things are in America today. As they sipped their Starbucks lattes and adjusted their designer sunglasses, they recited their grievances: The country is awash in debt "that we will have to pay off"; the middle class in shrinking; the polar ice caps are melting; and college is too expensive.

I've been speaking to groups like this one for more than 20 years, but I have never confronted such universal pessimism from a young audience. Its members acted as if the hardships of modern life are making it nearly impossible for them to get out of bed in the morning. So I conducted a survey of these grim youngsters. How many of you, I asked, own a laptop? A cellphone? An iPod, a DVD player, a flat-screen digital TV? To every question somewhere between two-thirds and all of the hands in the room rose. But they didn't even get my point. "Well, duh," one of them scoffed, "who doesn't have an iPod these days?" I was way too embarrassed to tell them that I, for one, don't. They thought that living without these products would be like going back to prehistoric times.

They seemed clueless that as recently as the early 1980s only the richest people in the world had cellphones and the quality of these products left much to be desired. Watch a movie from 20 years ago and you will laugh out loud seeing big clunky black machines that weighed as much as a brick, gave crackly service and cost $4,200. Now cellphones are practically free -- even disposable. And the cost of making calls has dropped dramatically too.

So why the long faces? Sen. Obama reminds them every day of how dreary things are. Here's what Mr. "Audacity of Hope" told workers in Ohio last week: "Everywhere I go . . . you see people who have worked in a plant for 20 years, put their heart and soul into building profits for shareholders. Suddenly, the rug's pulled out from under them; the job's shipped overseas." Not only that, he explains: "They don't have health care. They don't have a pension. They're trying to compete with their teenage kids for a job paying $7 an hour at the local fast food joint."

Times are tough in many old industrial areas of the country. And middle-class anxiety about the costs of health care and higher education is real. But new data from the Census Bureau reveal that Americans of all income groups have made enormous gains in their standard of living in recent decades. As late as 1970, air conditioning, color TVs, washing machines, dryers and microwaves were considered luxuries. Today the vast majority of even poor families have these things in their homes. Almost one in three "poor" families has not one but at least two cars.

Consumption in real per-capita terms has nearly doubled since 1970. The single largest increase in expenditures for low-income households over the past 20 years was for audio and visual entertainment systems -- up 119%. In 2007 Americans spent an estimated $1 billion to change the tune of the ringer on their cellphones. Eating in restaurants used to be something the rich did regularly and the middle class did on special occasions. The average family now spends $2,700 a year dining out.

There's a wonderful new video on Reason.tv called "Living Large." In it, comedian Drew Carey goes to a lake in California where people are relaxing on $80,000 27-foot boats and goofing around on $25,000 jet skis that they have hitched to their $40,000 SUVs. Mr. Carey asks these boat owners what they do for a living. As it turns out, they aren't hedge-fund managers. One is a gardener, another a truck driver, another an auto mechanic and another a cop.

When I was young my parents used to drill in me the moral imperative of eating everything on my plate, and they recited the (tall?) tale of how they even ate what would now be considered dog food during the darkest days of the Great Depression. The American Pet Products Manufacturers Association reports that Americans now spend $36 billion a year on their dogs, cats, turtles and so on, and one of the hottest-selling consumer items is "diet pet food." We have become a nation of fat cats -- literally. I have a friend whose daughter insisted that he spend $200 on eye surgery for their hamster. (I want to see that hamster read the eye chart!)

After my lecture, one young woman walked up to me on her way out and huffed: "What I favor is a radical redistribution of wealth in America." I tried to tell her that America's greatness is a result of our focus on creating wealth, not redistributing it. But it was too late -- she was already tuning in to her iPod.

Original here

How to Use Toilet Paper

Certain aspects of human life are simultaneously private and universal — everyone experiences the same stuff privately and almost no one talks about it. Pretty much everything that happens in the bathroom falls into this category, which is why I was amazed to discover that serious thought has gone into the challenges presented by toilet paper. Here are a few examples.

The Toilet Paper Algorithm

Design guru Don Norman decided to confront a common toilet paper crisis: the problem of the roll running out just when you need it most. When remodeling his home, Norman installed a dual-roll toilet paper dispenser, under the theory that there’d always be a second roll available for just such emergencies. But he quickly found that, for some reason, both rolls seemed to run out at the same time!

Norman applied some logical thinking to his problem, resulting in the article Toilet Paper Algorithms: I didn’t know you had to be a computer scientist to use toilet paper. The gist of it is that Norman and his wife were subconsciously selecting whatever roll was larger at any given time, leading them both to become roughly the same size, thus running out at the same time. (Read the article for more details on the various available toilet paper algorithms…it’s neat.)

For the record, Norman determined that the optimal strategy for using toilet paper in a dual-roll holder is to always use the smaller roll. This will tend to drive one roll to become empty, but will leave a full roll available.

Norman isn’t alone in his analysis of toilet paper roll consumption — Donald E. Knuth published a mathematics paper entitled The Toilet Paper Problem in The American Mathematical Monthly in 1984, including equations for analysis of toilet paper usage.

The Fold Versus Crumple Debate

I’ll try to put this as delicately as I can. Apparently there’s a significant debate about whether it’s better to fold several sheets of paper, or crumple them together in a bunch. One major argument in favor of the “fold” method is that depending on the quality of your paper and your folding technique, you can refold (and thus reuse) a single set of sheets. The counter-argument is that this is super-gross. I have my own opinions on this issue, but let’s just say I’ve tried multiple methodologies over the years and feel that I’ve perfected my technique.

So what’s the distribution of crumplers versus folders in the wild? An online toilet paper usage survey has received almost 5,000 responses. At the moment, the folders are slightly in the lead (52%), but tend to be a little older than crumplers. Also, far more crumplers are male than female (70% of crumplers in the survey are male). You can take the survey or just hit the ‘View’ button to see the results without contributing your own.

Toilet Paper Requisition Denied

Here’s some fun WWII trivia. Lieutenant Commander J. W. Coe of the submarine USS Skipjack requested 150 rolls of toilet paper from the supply officer at Mare Island Naval Base in July of 1941. The request was denied in November of 1941 with a notation saying, “Cancelled — cannot identify.” By June 1942 the situation onboard USS Skipjack was dire, and Coe sent another request, reading in part:

During the 11-3/4 months elapsing from the time of ordering the toilet paper and the present date, USS SKIPJACK personnel, despite their best efforts to await delivery of the subject material, have been unable to wait on numerous occasions, and the situation is now quite acute, particularly during depth-charge attacks by the “back stabbers.”

…

SKIPJACK personnel during this period have become accustomed to the use of “crests,” i.e., the vast amount of incoming non-essential paper work, and in so doing feel that the wish of the Bureau of Ships for reduction of paper work is being complied with, thus killing two birds with one stone.

Read the rest at the wonderful Snopes page detailing the event.

Got any toilet paper trivia, or an opinion on fold-versus-crumple? Share it with us in the comments!

(Toilet paper photo courtesy of Brandon Blinkenberg and Wikimedia Commons.)

Original here

Volkswagen’s TDI Hybrid- The Prius Killer?

Some car manufacturers, like Toyota and their uber-trendy Prius, are cranking out new models that represent the hybrid car of the future. Others, like Volkswagen, are working with what they’ve got, making their existing cars cleaner and greener. Volkswagen has just recently unveiled a TDI hybrid version of their cute and sporty Golf model that can achieve 83mpg. Will this be the one to de-throne the Prius?

While at the moment, this is a concept, the Golf TDI Hybrid is a 1.2 liter, 3 cylinder advanced diesel engine with an electric motor that produces no more than 89g/km of CO2. Like other hybrids, as soon as the vehicle drops below a certain speed, it switches to its electric motor, essentially turning into an almost emission free vehicle.

The zippy little car comes with a recovery system to recharge the battery using the cars braking system. The car’s design is slightly different from the standard Golf model, with a slightly different grill design and small air intakes to improve the aerodynamic qualities of the car.

So how does it compare to the Prius? According to VW, this vehicle is capable of achieving 82mpg while the Toyota Prius only reaches 55mpg. That’s a pretty impressive difference. But now rumors are flying around of a 100mpg plus Prius model. Needless to say, this is a competition that we are happy too see.

+ VW in Geneva

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Awesome Pin-Ups Vintage Inspiration

Who doesn't love Pin-ups? These pretty ladies have been out there for over 50, 60 years, and still look fresh and awesome. And they are great source of inspiration!

Vintage posters will rock once you fix a pin-up in it... but first you must find the right theme... and boy, there are a LOT of themes for this pin-ups. Hope you find the one you're looking for! ;D

Original here

Is it 2D or 3D?

Florida Senate passes droopy pants law

TALLAHASSEE, Florida (Reuters) - The Florida Senate wants public school students to pull up their pants.

Lawmakers passed a bill on Thursday that could mean suspensions for students with droopy britches. It won't become law unless the House of Representatives passes a companion measure.

Florida could join several southern U.S. towns and cities that have passed "saggy pants" laws aimed at outlawing what some teenagers consider a fashion statement -- wearing pants half way down their buttocks, exposing flesh or underwear.

Supporters say schools sometimes don't properly police dress codes and parents are often "under aware" of what their kids are wearing to school.

Critics say the measure is unnecessary, arguing that appearance and dress codes should be the responsibility of school districts and parents.

Despite being the butt of jokes, the bill's sponsor, Orlando Sen. Gary Siplin, a Democrat, has said the fashion statement has a back-story -- it was made popular by rap artists after first appearing among prison inmates as a signal they were looking for sex.

"All we're trying to do now is trying to inform folks that we have a fad now that does not have a very good origination," Siplin said. "We're trying to make an example in school," he added, saying it would help students get jobs and a degree.

The Florida city of Riviera Beach passed its own saggy pants law on Tuesday, with a maximum penalty of 60 days in jail for repeat offenders.

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Writer Arthur C Clarke dies at 90

Sir Arthur C Clarke was famous for his science fiction writing

British science fiction writer Sir Arthur C Clarke has died in his adopted home of Sri Lanka at the age of 90.

The Somerset-born author achieved his greatest fame in 1968 when his short story The Sentinel was turned into the film 2001: A Space Odyssey.

His visions of space travel and computing sparked the imagination of readers and scientists alike.

Sri Lankan President Mahinda Rajapakse paid tribute, hailing the writer as a "great visionary".

Since 1995, the author had been largely confined to a wheelchair by post-polio syndrome.

He died at 0130 local time (2000 GMT) of respiratory complications and heart failure, according to his aide, Rohan De Silva.

Far-seeing scientist

"Sir Arthur has left written instructions that his funeral be strictly secular," his secretary, Nalaka Gunawardene, was quoted as saying by news agency AFP.

She said the author had requested "absolutely no religious rites of any kind".

A farmer's son, Sir Arthur was educated at Huish's Grammar School in Taunton before joining the civil service.

A great science fiction writer, a very good scientist, a great prophet and a very dear friend Sir Patrick Moore Obituary of Arthur C Clarke Predictions: Hits and misses In quotes: tributes to writer

He served in the Royal Air Force during World War II, and foresaw the concept of communication satellites.

Sir Arthur's detailed descriptions of space shuttles, super-computers and rapid communications systems inspired millions of readers.

When asked why he never patented his idea for communication satellites, he said: "I did not get a patent because I never thought it will happen in my lifetime."

In the 1940s, he maintained man would reach the moon by the year 2000, an idea dismissed at the time.

He was the author of more than 100 fiction and non-fiction books, and his writings are credited by many observers with giving science fiction a human and practical face. He collaborated on the screenplay for 2001: A Space Odyssey with the film's director Stanley Kubrick.

'Great prophet'

British astronomer Sir Patrick Moore had known Sir Arthur since they met as teenagers at the British Interplanetary Society.

Sir Patrick paid tribute to his friend, remembering him as "a very sincere person" with "a strong sense of humour".

Tributes have also come from George Whitesides, the executive director of the National Space Society, where Sir Arthur served on the board of governors, and fellow science fiction writer Terry Pratchett.

HAVE YOUR SAY

His writing inspired many people to wonder what might be possible

Pratik, California

Send us your comments

The author married in 1953, and was divorced in 1964. He had no children.

He moved to the Indian Ocean island of Sri Lanka in 1956 after embarking on a study of the Great Barrier Reef.

There, he pursued his interest in scuba diving, even setting up a diving school at Hikkaduwa, near the capital, Colombo.

"Sometimes I am asked how I would like to be remembered," he recalled recently.

"I have had a diverse career as a writer, underwater explorer and space promoter. Of all these, I would like to be remembered as a writer."

A statement from Sir Arthur's office said he had recently reviewed the final manuscript of his latest novel.

The Last Theorem, co-written with Frederik Pohl, will be published later this year, it said.

Original here

(New Math) x(SEC Rules) +Proxy=Confusion

The latest proxy statement from Applied Materials Inc. tells exactly how the company set 2007 bonuses for top executives:

"Base Salary x Individual Target Percentage x (Weighted Score + Total Stockholder Return Adder, if Achieved)."

Of some help may be Applied's definition of weighted score:

"(Performance Measure 1 x Weight as Percentage) + (Performance Measure 2 x Weight as Percentage)."

And so on.

As a maker of semiconductor equipment, Applied Materials belongs to an industry of mathematical whizzes. Yet the complexity of its proxy this year reflects a trend that extends far beyond Silicon Valley. Even Deere & Co., the maker of tractors, has produced a proxy that uses three formulas, four tables and a graph to illustrate the calculation of executive bonuses.

This explosion of mathematics was sparked by the Securities and Exchange Commission, which in 2006 began requiring more information about how companies calculate executive pay. After the first batch of proxies using the new rules arrived last year, the SEC told 350 companies they hadn't been specific enough.

Among those companies was Applied Materials. So this year, it expanded by 76% the word count of its proxy's compensation section. In all, the compensation section contains 16,245 words -- twice the length of the U.S. Constitution and its 27 Amendments -- along with 10 formulas, 10 tables and 155 percent signs.

The result, according to some experts, is unfathomable. "Can even the executives figure out what they have to do to get these awards?" asks Carol Bowie, head of corporate-governance research at RiskMetrics Group Inc., which helps investors sort through such filings.

The SEC has said that it wants disclosure to be clear and concise, as well as comprehensive. But striking that balance is difficult, companies say. So, many are erring on the side of detail.

"Bonus multiple x target bonus x base salary earnings = payout," explains the new proxy from drug maker Eli Lilly & Co., which last year received a letter from the SEC calling its executive-pay disclosure inadequate. Just in case that term "bonus multiple" isn't clear, the proxy explains that it is "(0.25 x sales multiple) + (0.75 x adjusted EPS multiple)." To find the sales and EPS multiples, investors must consult graphs.

Some firms may be throwing up their hands and deluging the public with figures. "I know a couple of companies where the frustration level with the SEC was so large that they said, 'Just put it all in,'" says John A. Hill, a trustee at mutual-fund giant Putnam Funds. Mr. Hill often chats about pay practices with officials of companies whose stock Putnam investors own.

An SEC spokesman says it's too early to comment on 2008 proxies.

Even activist investors who pushed for more disclosure on executive pay are scratching their heads. "There have been some proxies when I've gone through and said, 'Wow, I have no idea what I just read,'" says Scott Zdrazil, director of corporate governance at union-owned Amalgamated Bank, which manages around $12 billion in pension-fund assets.

The Smell Test

Mr. Zdrazil says he uses a "smell test" to judge whether companies are trying to obscure poor pay practices with lots of detail, or just being wonky. "If you can clearly understand the algebra involved, it passes," he says.

One that doesn't pass his test is software maker Novell Inc. Its proxy tosses around such terms as "assigned weighted quantitative performance objective achievement percentage," and describes a two-step process for calculating executive bonuses:

First: "Bonus Funding Percentage x Weighted Quantitative Performance Objectives Achievement x Qualitative Performance Factor = Performance Factor."

Then: "Performance Factor x Target Bonus Percentage x Base Salary = Recommended Bonus Amount."

Mr. Zdrazil says Novell fails to explain how difficult it is for executives to achieve performance targets.

Asked about the formulas, Novell says it gave more detail in response to the SEC's push and that its proxy statement complies with SEC rules.

At first glance, the bonus formula at software maker Adobe Systems Inc. seems straightforward: "Target Bonus x Unit Multiplier x Individual Results."

But then comes the definition of unit multiplier. Adobe says it is:

"Derived from aggregating the target bonus of all participants in the Executive Bonus Plan multiplied by the funding level determined under the funding matrix, and allocating a portion of the funding level to each business or functional unit of Adobe based on that unit's relative contribution to Adobe's success, and then dividing the allocated funding level by the aggregate target bonuses of participants working within each such unit." Got that?

After all that calculating, Adobe's top five executives somehow received the exact same unit multiplier -- 200%. Adobe says that was the highest possible percentage and that it reflects how well the company performed.

Degree of Transparency

Adobe also says it "strives for a high degree of transparency" in financial reporting, and that it added detail this year on executive compensation "in that spirit, and in response to new SEC requirements."

Applied's bonus formula was created a decade ago by an employee who majored in math, but the company hadn't previously included it in its filings. General Counsel Joe Sweeney says the new compensation discussion has won praise from investors and lawyers. Proxy adviser Glass Lewis & Co., which says it has no financial relationship with Applied, called the company's proxy "clear and concise."

But Applied shareholder Robert Friedman, a retired computer programmer, isn't so sure. "This is too much," he says, munching on a cookie and flipping through a proxy moments before the company's March 11 annual meeting. "I own about a dozen companies, and if I did this for every company..."

For all its length, Applied's proxy doesn't reveal some crucial information, such as the target to which the company would like to see its market share increase. That number -- key to calculating the CEO's bonus according to the formula -- must be kept from rivals, Mr. Sweeney, the general counsel, says. For the same reason, the document also excludes some information about other executives' performance goals. "I hate to think how long the [compensation section] would have been if we had included all the factors for all the individuals," says Mr. Sweeney.

So if some important factors remain secret, what's the point of all the math? Mr. Sweeney says it is meant to give shareholders a taste of the decision-making process.

Original here

Starbucks must pay $100m in tips

Starbucks said the ruling was "fundamentally unfair"

A US judge has ordered Starbucks to repay its California coffee-makers more than $100m (£50m) in tips that were paid to shift supervisors.

San Diego Superior Court Judge Patricia Cowett said the coffee-makers - "baristas" - were entitled to $86m in back tips, plus interest.

She issued an injunction banning supervisors from sharing future tips.

She said the practice broke a state law barring managers and supervisors from obtaining a share of employee tips.

A Starbucks spokeswoman, Valerie O'Neil, said the company planned to appeal against the ruling, which she described as "fundamentally unfair and beyond all common sense and reason".

The lawsuit was filed in October 2004 by Jou Chou, a former Starbucks barista in La Jolla, California.

In 2006 the suit was granted class action status, allowing it to go forward on behalf of as many as 100,000 former and current baristas in the chain's California stores.

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Foreign Investors Systematically Dumping US Treasuries

As feared, foreign bond holders have begun to exercise a collective vote of no confidence in the devaluation policies of the US government. The Federal Reserve faces a potential veto of its rescue measures.

Contagion fears sweep across the Atlantic

Dollar plunges as Fed steps up moves

Read more of Ambrose Evans-Pritchard

	Desperate measures: Bernanke and the Federal Reserve need to keep on top of the crisis and continue to intervene if needed

Asian, Mid East and European investors stood aside at last week's auction of 10-year US Treasury notes. "It was a disaster," said Ray Attrill from 4castweb. "We may be close to the point where the uglier consequences of benign neglect towards the currency are revealed."

The share of foreign buyers ("indirect bidders") plummeted to 5.8pc, from an average 25pc over the last eight weeks. On the Richter Scale of unfolding dramas, this matches the death of Bear Stearns.

Rightly or wrongly, a view has taken hold that Washington is cynically debasing the coinage, hoping to export its day of reckoning through beggar-thy-neighbour policies.

It is not my view. I believe the forces of debt deflation now engulfing America - and soon half the world - are so powerful that nobody will be worrying about inflation a year hence.

Yes, the Fed caused this mess by setting the price of credit too low for too long, feeding the cancer of debt dependency. But we are in the eye of the storm now. This is not a time for priggery.

The Fed's emergency actions are imperative. Last week's collapse of confidence in the creditworthiness of Fannie Mae and Freddie Mac was life-threatening. These agencies underpin 60pc of the $11,000bn market for US home loans.

With the "financial accelerator" kicking into top gear - downwards - we may need everything that Ben Bernanke can offer.

Bear Stearns may be worse than LTCM collapse

Jeff Randall: A world addicted to easy credit must go cold turkey

How Bear Stearns ran out of the necessities

"The situation is getting worse, and the risks are that it could get very bad," said Martin Feldstein, head of the National Bureau of Economic Research. "There's no doubt that this year and next year are going to be very difficult."

Even monetary policy à l'outrance may not be enough to halt the spiral. Former US Treasury secretary Lawrence Summers says the Fed's shower of liquidity cannot cure a bankruptcy crisis caused by a tidal wave of property defaults.

"It is like fighting a virus with antibiotics," he said.

We can no longer exclude a partial nationalisation of the American banking system, modelled on the Nordic rescue in the early 1990s.

But even if you think the Fed has no choice other than to take dramatic action, the critics are also right in warning that this comes at a serious cost and it may backfire.

The imminent risk is that global flight from US Treasury and agency debt drives up long-term rates, the key funding instrument for mortgages and corporations. The effect could outweigh Fed easing.

Overall credit conditions could tighten into a slump (like 1930). It's the stuff of bad dreams.

Is this the moment when America finally discovers the meaning of the Faustian pact it signed so blithely with Asian creditors?

As the Wall Street Journal wrote this weekend, the entire country is facing a "margin call". The US has come to depend on $800bn inflows of cheap foreign capital each year to cover shopping bills. They may have to pay a much stiffer rent.

As of June 2007, foreigners owned $6,007bn of long-term US debt. (Equal to 66pc of the entire US federal debt). The biggest holdings by country are, in billions: Japan (901), China (870), UK (475), Luxembourg (424), Cayman Islands (422), Belgium (369), Ireland (176), Germany (155), Switzerland (140), Bermuda (133), Netherlands (123), Korea (118), Russia (109), Taiwan (107), Canada (106), Brazil (103). Who is jumping ship?

The Chinese have quickened the pace of yuan appreciation to choke off 8.7pc inflation, slowing US bond purchases. Petrodollar funds, working through UK off-shore accounts, are clearly dumping dollars amid rumours that Gulf states - overheating wildly - are about to break their dollar pegs. But mostly likely, the twin crash in the dollar and US agency debt reflects a broad exodus by global wealth managers, afraid that America is spinning out of control. Sauve qui peut.

The bond debacle last week tallies with the crash in the dollar index to an all-time low of 71.58, down 14.6pc in a year. The greenback is nearing parity with the Swiss franc - shocking for those who remember when it was 4.375 francs in 1970. Against the euro it has hit $1.57, from $0.82 in 2000. Against the yen it has smashed through Y100. Spare a thought for Toyota. It loses $350m in revenues for every one yen move. That is an $8.75bn hit since June. Tokyo's Nikkei index is crumbling. Less understood, it is also causing a self-reinforcing spiral of credit shrinkage throughout the global system.

Japanese investors and foreign funds are having to close their yen "carry trade" positions. A chunk of the $1,400bn trade built up over six years has been viciously unwound in weeks. The harder the dollar falls, the further this must go.

It is unsettling to watch the world's reserve currency disintegrate. Commodities from gold to oil and wheat are taking on the role of safe-haven "currencies". The monetary order is becoming unhinged.

I doubt the dollar can fall much further. What is it to fall against? The spreading credit contagion will cause large parts of the globe to downgrade in hot pursuit - starting with Europe.

Few noticed last week that the Italian treasury auction was also a flop. The bids collapsed. For the first time since the launch of EMU, Italy failed to sell a full batch of state bonds.

The euro blasted higher anyway, driven by hot money flows. The funds are beguiled by Germany's "Exportwunder", for now. It cannot last. The demented level of $1.57 will not be tolerated by French, Italian and Spanish politicians. The Latin property bubbles are deflating fast.

The race to the bottom must soon begin. Half the world will be slashing rates this year to stave off credit contraction. The dollar will have a lot of company. Small comfort.

Original here

Starbucks customers clamoring for more free Wi-Fi

SANTA BARBARA, CALIF. -- The Starbucks Corporation has launched a social network, of sorts, where customers can post suggestions or complaints, and vote on the posts of other customers if they agree. Like foam in a cappuccino, the most popular entries rise to the top.

First, let me say this move is bold and beautiful, and that other companies should emulate it. The site, called My Starbucks Idea, provides a way for the company to focus its attention on the real complaints or concerns real customers really have, rather than the ones the company imagines are most important. Plus it makes customers feel trusted and listened to. Bravo, Starbucks.

Comments are categorized. In the "Atmosphere & Locations" category, the customers are clamoring for free Wi-Fi.

As I reported February 11, Starbucks announced on that day two hours of free Wi-Fi for Starbucks cardholders at locations that have a Wi-Fi network. If the comments on My Starbucks Idea are any indication, customers want a lot more Wi-Fi, and they want it a lot freer.

The number-one voted comment (with nearly three times the number of votes as the number-two comment) is: "Starbucks needs to make ALL stores have free Wi-Fi. In Seattle I go to Tully's, because of the free Wi-Fi, not superior service." Another customer wrote: "I purposely go to a cafe in my home town that offers free wi-fi. I drive by 3 Starbucks on the way there and pay 50 cents more for the mocha for the free wi-fi."

As you browse the comments it becomes clear that customers want free Wi-Fi, and other things that go with it, such as:

"convenient power connections for laptops"

"one or two comfy study desks for students to spread out. I always fell guilty using the handicap table."

"A way for Starbucks to offer free WiFi to customers, and not the rest of the surrounding area, would be to place temporary passwords on each cup that expire after a set amount of time (e.g. 2 hours)."

Starbucks has done the right thing with My Starbucks Idea, and it appears to be well-implemented. Now if they can address the major complaints -- such as moving to free Wi-Fi -- they'll have hit a major home run.

Original here

A Couple of My Rules for Startups

My buddy Jason had a GREAT post about rules for startups. Read it, love it learn it.

Of course, anyone who has started a company has their own rules and guidelines, so I thought i would add to the meme with my own. My "rules" below aren't just for those founding the companies, but for those who are considering going to work for them as well.

1. Don't start a company unless its an obsession and something you love.

2. If you have an exit strategy, its not an obsession.

3. Hire people who you think will love working there.

4. Sales Cures All. Know how your company will make money and how you will actually make sales.

5. Know your core competencies and focus on being great at them. Pay up for people in your core competencies. Get the best. Outside the core competencies, hire people that fit your culture but are cheap

6. An expresso machine ? Are you kidding me ? Shoot yourself before you spend money on an expresso machine. Coffee is for closers. Sodas are free. Lunch is a chance to get out of the office and talk. There are 24 hours in a day, and if people like their jobs, they will find ways to use as much of it as possible to do their jobs.

7. No offices. Open offices keeps everyone in tune with what is going on and keeps the energy up. If an employee is about privacy, show them how to use the lock on the john. There is nothing private in a start up. This is also a good way to keep from hiring execs who can not operate successfully in a startup. My biggest fear was always hiring someone who wanted to build an empire. If the person demands to fly first class or to bring over their secretary, run away. If an exec wont go on salescalls, run away. They are empire builders and will pollute your company.

8. As far as technology, go with what you know. That is always the cheapest way. If you know Apple, use it. If you know Vista... ask yourself why, then use it. Its a startup, there are just a few employees. Let people use what they know.

9. Keep the organization flat. If you have managers reporting to managers in a startup, you will fail. Once you get beyond startup, if you have managers reporting to managers, you will create politics.

10. NEVER EVER EVER buy swag. A sure sign of failure for a startup is when someone sends me logo polo shirts. If your people are at shows and in public, its ok to buy for your own folks, but if you really think someone is going to wear your Yobaby.com polo you sent them in public, you are mistaken and have no idea how to spend your money

11. NEVER EVER EVER hire a PR firm. A PR firm will call or email people in the publications, shows and websites you already watch, listen to and read. Those people publish their emails. Whenever you consume any information related to your field, get the email of the person publishing it and send them an email introducing yourself and the company. Their job is to find new stuff. They will welcome hearing from the founder instead of some PR flack. Once you establish communications with that person, make yourself available to answer their questions about the industry and be a source for them. If you are smart, they will use you.

12. Make the job fun for employees. Keep a pulse on the stress levels and accomplishments of your people and reward them. My first company, MicroSolutions, when we had a record sales month, or someone did something special, I would walk around handing out 100 dollar bills to salespeople. At Broadcast.com and MicroSolutions, we had a company shot. Kamikaze. We would take people to a bar every now and then and buy one or 10 for everyone. At MicroSolutions, more often than not we had vendors cover the tab. Vendors always love a good party :0

These are all off the top of my head. But they have worked for me so far.

Original here

Efforts to Block Junk Mail Slowed

Chris Pearson, a state legislator in Vermont, had a sense that the people were with him when he proposed a bill last November to allow residents to block junk mail.

He got media attention, radio interview requests and e-mails from constituents eager to stop the credit card offers, furniture catalogues and store fliers that increasingly clog their mailboxes.

Then came the pushback from the postmasters, who told Pearson and other lawmakers that "standard" mail, the post office's name for junk mail, has become the lifeblood of the U.S. Postal Service and that jobs depend on it.

"The post office and the business groups are pretty well-organized," said Pearson, whose bill remains in a committee and has not been scheduled for a vote.

Barred by law from lobbying, the Postal Service is nonetheless trying to make its case before a growing number of state legislatures that are weighing bills to create Do Not Mail registries, which are similar to the popular National Do Not Call Registry.

The agency has printed 3,000 "information packets" about the economic value of standard mail, with specific data for each of the 18 states that have considered a Do Not Mail Registry. It has dispatched postmasters to testify before legislative committees around the country.

"The Postal Service has come in and clobbered legislators," said Todd Paglia, executive director of ForestEthics, an environmental group that has collected 289,000 signatures on an online petition to Congress that calls for a National Do Not Mail Registry. "It's really a people-versus-special interest kind of battle."

The Postal Service is working closely with the Direct Marketing Association, the trade group that represents retailers and the printing industry, in its new campaign -- Mail Moves America -- which is designed to quash the Do Not Mail initiatives.

So far, their efforts appear effective. None of the states where Do Not Mail legislation has been introduced since 2007 has approved a law. And no similar legislation is pending in Congress.

Sean Sheehan of the Center for a New American Dream, a progressive group based in Takoma Park, said state efforts may precede national action, just as they did with the Do Not Call Registry.

"Federal legislators are more sensitive to the heavy lobbying of the paper industry, as well as the impact on the postal service, whereas a lot of state legislators are really more in tune with local needs," Sheehan said. "It's local governments that have to pay millions to truck that trash out to landfills."

So far in the 2008 campaign cycle, the Direct Marketing Association has made $141,877 in contributions to federal candidates, including $6,610 to Sen. Thomas R. Carper (D-Del.), who chairs the subcommittee that oversees the Postal Service and does not face reelection until 2012.

Perhaps surprisingly, environmental groups -- whose members say they are concerned about junk mail -- are cool to the idea of a registry that prohibits marketers from sending mail to those enrolled and that fines violators.

One reason may be that most environmental groups are themselves junk mailers. They use standard mail for their solicitation letters.

A national registry "would affect anybody who mails," said Laura Hickey, senior director of global warming education at the National Wildlife Foundation, which belongs to the Direct Marketing Association. "I don't think it would be any different whether you were for-profit or nonprofit.'' As an alternative, the National Wildlife Foundation, the Natural Resources Defense Council and other groups have created Catalogue Choice, a program that asks retailers to voluntarily stop sending catalogues to anyone who signs up for the free online service at http://www.catalogchoice.org.

"If people participate in a voluntary system, then I don't see the need for a legislative strategy," Hickey said. When Catalogue Choice was launched in October, the foundation expected about 150,000 people to sign up in the first year. Six months into the project, more than 642,000 people have joined. "It obviously filled a void," Hickey said.

Still, it is unclear how many marketers are voluntarily heeding requests to stop mailing.

The Direct Marketing Association operates its own registry ( http://www.dmachoice.org) and in an e-mail sent last November, instructed its members to ignore Catalogue Choice.

Postal officials say they are aware of the environmental concerns related to junk mail. In testimony on Capitol Hill last week, Postmaster General John E. Potter told lawmakers that the Postal Service has one answer: Recycling bins positioned beneath personal mailboxes at post offices, to catch junk mail as it tumbles out.

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