Central Perk: 2 aug. 2013

vineri, 2 august 2013

Mish's Global Economic Trend Analysis

NSA tool collects "Nearly Everything You Do On the Internet"; Targeting Journalists; What Google Knows About You; Warrantless Cellphone Tracking Upheld

Posted: 02 Aug 2013 09:09 AM PDT

Today I offer a quartet of news stories on the NSA, widespread targeting of Journalists even by New Zealand, broad cellphone tracking, and a synopsis of what Google knows about you.

Let's kick off with the Guardian XKeyscore: NSA tool collects 'nearly everything a user does on the internet'.

• XKeyscore gives 'widest-reaching' collection of online data
• NSA analysts require no prior authorization for searches
• Sweeps up emails, social media activity and browsing history

A top secret National Security Agency program allows analysts to search with no prior authorization through vast databases containing emails, online chats and the browsing histories of millions of individuals, according to documents provided by whistleblower Edward Snowden.

The NSA boasts in training materials that the program, called XKeyscore, is its "widest-reaching" system for developing intelligence from the internet.

XKeyscore, the documents boast, is the NSA's "widest reaching" system developing intelligence from computer networks – what the agency calls Digital Network Intelligence (DNI). One presentation claims the program covers "nearly everything a typical user does on the internet", including the content of emails, websites visited and searches, as well as their metadata.

The purpose of XKeyscore is to allow analysts to search the metadata as well as the content of emails and other internet activity, such as browser history, even when there is no known email account (a "selector" in NSA parlance) associated with the individual being targeted.

Analysts can also search by name, telephone number, IP address, keywords, the language in which the internet activity was conducted or the type of browser used.

William Binney, a former NSA mathematician, said last year that the agency had "assembled on the order of 20 trillion transactions about US citizens with other US citizens", an estimate, he said, that "only was involving phone calls and emails". A 2010 Washington Post article reported that "every day, collection systems at the [NSA] intercept and store 1.7 billion emails, phone calls and other type of communications."

Targeting of Investigative Journalists

Pater Tenebrarum on the Acting Man blog writes about the Targeting of Investigative Journalists and those opposed to the War in Afghanistan.

There are seemingly constantly new revelations about extremely questionable practices employed by the security apparatus. The latest comes from 'five eyes' partner New Zealand, which not too long ago had to admit that its spooks illegally spied on Kim Dotcom to help the FBI make an example of the man in the context of copyright enforcement (we have previously discussed the case of Dotcom, who is accused of breaking laws that apparently don't even exist).

New Zealand's reaction to this embarrassment was, as you may have guessed, to introduce new legislation that will henceforth legalize domestic spying. In the meantime, its security apparatus seems not really deterred by the embarrassment caused to it by the Dotcom case and continues to engage in highly dubious surveillance activities, actively aided and abetted by US intelligence services. The target in the latest case was an investigative journalist working for McClatchy. Here is an excerpt from an article on the matter by the CPJ, [the Committee to Protect Journalists]. We want to direct your attention especially to the final paragraph below, which is quite chilling:

"Concern over government surveillance of journalists has washed up on the faraway shores of New Zealand, with a report in the country's Sunday Star this week asserting that the military there, with help from U.S. intelligence, spied on an investigative journalist who had been critical of its activities in Afghanistan.

Compounding concerns about the New Zealand military's targeting of journalists, the Sunday Star reported that a confidential military training manual drafted in 2003 lists investigative journalists as one of the top threats to state security–up there with terrorists and hostile foreign intelligence groups. A military official in New Zealand acknowledged the existence of the manual on Monday, referring to it as "inappropriate and heavy-handed," and ordered a revision to remove any references to journalists, news reports said."

Whether or not they remove the references to journalists from their training manual, the mindset is clear – this is what they actually believe: "Investigative journalists are one of the top threats to state security–up there with terrorists and hostile foreign intelligence groups."

We have to admit that this is actually true – in a dictatorship. In allegedly free countries, investigative journalists are usually deemed to be among the people who help seeing to it that they remain free.

Search for Pressure Cooker Leads to Knock on Door From Terrorism Police

Via reference from ZeroHedge, please consider pressure cookers, backpacks and quinoa, oh my!

It was a confluence of magnificent proportions that led six agents from the joint terrorism task force to knock on my door Wednesday morning. Little did we know our seemingly innocent, if curious to a fault, Googling of certain things was creating a perfect storm of terrorism profiling. Because somewhere out there, someone was watching. Someone whose job it is to piece together the things people do on the internet raised the red flag when they saw our search history.

Most of it was innocent enough. I had researched pressure cookers. My husband was looking for a backpack. And maybe in another time those two things together would have seemed innocuous, but we are in "these times" now.

I was at work when it happened. My husband called me as soon as it was over, almost laughing about it but I wasn't joining in the laughter. His call left me shaken and anxious.

What happened was this: At about 9:00 am, my husband, who happened to be home yesterday, was sitting in the living room with our two dogs when he heard a couple of cars pull up outside. He looked out the window and saw three black SUVs in front of our house; two at the curb in front and one pulled up behind my husband's Jeep in the driveway, as if to block him from leaving.

Six gentleman in casual clothes emerged from the vehicles and spread out as they walked toward the house, two toward the backyard on one side, two on the other side, two toward the front door.

They walked around the living room, studied the books on the shelf (nope, no bomb making books, no Anarchist Cookbook), looked at all our pictures, glanced into our bedroom, pet our dogs. They asked if they could go in my son's bedroom but when my husband said my son was sleeping in there, they let it be.

They asked about me, where was I, where do I work, where do my parents live. Do you have any bombs, they asked. Do you own a pressure cooker? My husband said no, but we have a rice cooker. Can you make a bomb with that? My husband said no, my wife uses it to make quinoa. What the hell is quinoa, they asked.

Have you ever looked up how to make a pressure cooker bomb? My husband, ever the oppositional kind, asked them if they themselves weren't curious as to how a pressure cooker bomb works, if they ever looked it up. Two of them admitted they did.

45 minutes later, they shook my husband's hand and left. That's when he called me and relayed the story. That's when I felt a sense of creeping dread take over. What else had I looked up? What kind of searches did I do that alone seemed innocent enough but put together could make someone suspicious?

They mentioned that they do this about 100 times a week.

Mostly I felt a great sense of anxiety. This is where we are at. Where you have no expectation of privacy. Where trying to learn how to cook some lentils could possibly land you on a watch list. Where you have to watch every little thing you do because someone else is watching every little thing you do.

All I know is if I'm going to buy a pressure cooker in the near future, I'm not doing it online.

I'm scared. And not of the right things.

CLARIFICATION AND UPDATE

We found out through the Suffolk Police Department that the searches involved also things my husband looked up at his old job. We were not made aware of this at the time of questioning and were led to believe it was solely from searches from within our house.

Warrantless Cellphone Tracking Upheld

The New York Times reports Warrantless Cellphone Tracking Is Upheld

In a significant victory for law enforcement, a federal appeals court on Tuesday said that government authorities could extract historical location data directly from telecommunications carriers without a search warrant.

The closely watched case, in the United States Court of Appeals for the Fifth Circuit, is the first ruling that squarely addresses the constitutionality of warrantless searches of historical location data stored by cellphone service providers. Ruling 2 to 1, the court said a warrantless search was "not per se unconstitutional" because location data was "clearly a business record" and therefore not protected by the Fourth Amendment.

For now, the ruling sets an important precedent: It allows law enforcement officials in the Fifth Circuit to chronicle the whereabouts of an American with a court order that falls short of a search warrant based on probable cause.

"This decision is a big deal," said Catherine Crump, a lawyer with the American Civil Liberties Union. "It's a big deal and a big blow to Americans' privacy rights."

Cellphone privacy measures have been proposed in the Senate and House that would require law enforcement agents to obtain search warrants before prying open location records. Montana recently became the first state to require a warrant for location data. Maine soon followed. California passed a similar measure last year but Gov. Jerry Brown, a Democrat, vetoed it, saying it did not strike what he called the right balance between the demands of civil libertarians and the police.

What Google Knows About You

Tyler Durden at Zerohedge has an interesting post What Google Knows About You.

It's safe to assume everything you have ever searched for, every address you looked up on Google, every email you sent, every chat message, every YouTube video you watched. It's also safe to assume every entry is time-stamped, so it's clear exactly, down to the minute, when all of this was done, and where you were at when you did it.

The data can and will be used against you, in many imaginable ways, and in some ways you may not have remotely conceived, such as how searching for pressure cookers may get you an unexpected call from the terrorist police.

My friend Pater Tenebrarum commented via email "The alleged 'separation of powers' is increasingly revealed as a sham - in the end, you have the government 'controlling' and 'limiting' itself."

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Establishment Survey: +162K Jobs, May and June Revised Lower; Household Survey: +227K; Part-Time Jobs +103,000

Posted: 02 Aug 2013 07:25 AM PDT

Initial Reaction

The establishment survey showed a gain of 162,000 jobs.

The previous two months were revised lower. The employment change for May revised down by 19,000 (from +195,000 to +176,000), and the employment change for June revised down by 7,000 (from +195,000 to +188,000).

The unemployment rate dropped 0.2 to 7.4%.

Explaining the Unemployment Rate Drop

Employment rose by 227,000 of which 103,000 were part-time jobs.
The Civilian Labor Force Declined by 37,000 even though population rose by 204,000.
Those "Not in Labor Force" rose by 240,000.
Participation Rate fell 0.1 to 63.4%, a mere 0.1 higher than the low of 63.3% dating back to 1979.

July BLS Jobs Statistics at a Glance

Payrolls +162,000 - Establishment Survey
US Employment +227,000 - Household Survey
US Unemployment -263,000 - Household Survey
Involuntary Part-Time Work +19,000 - Household Survey
Voluntary Part-Time Work +84,000 - Household Survey
Baseline Unemployment Rate -0.2 - Household Survey
U-6 unemployment -0.3 to 14.0% - Household Survey
Civilian Labor Force -37,000 - Household Survey
Not in Labor Force -240,000 - Household Survey
Participation Rate -0.1 at 63.4 - Household Survey

Quick Notes About the Unemployment Rate

The unemployment rate varies in accordance with the Household Survey, not the reported headline jobs number, and not in accordance with the weekly claims data.
In the last year, those "not" in the labor force rose by 1,598,000
Over the course of the last year, the number of people employed rose by 2,035,000 (an average of 170,000 a month)
In the last year the number of unemployed fell from 12,745,000 to 11,514,000 (a drop of 1,231,000)
Percentage of long-term unemployment (27 weeks or more) is 37.0%, an increase of 0.3 from last month. Once someone loses a job it is still very difficult to find another.
8,245,000 workers who are working part-time but want full-time work. A year ago there were 8,245,000. There has been no improvement in a year. This is a volatile series.

June 2013 Jobs Report

Please consider the Bureau of Labor Statistics (BLS) July 2013 Employment Report.

Total nonfarm payroll employment increased by 162,000 in July, and the unemployment rate edged down to 7.4 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in retail trade, food services and drinking places, financial activities, and wholesale trade.

Click on Any Chart in this Report to See a Sharper Image

Unemployment Rate - Seasonally Adjusted

Month to Month Changes Since 2009

click on chart for sharper image

Change From Previous Month by Job Type

Hours and Wages

Average weekly hours of all private employees fell 0.1 to 34.4 hours. Average weekly hours of all private service-providing employees fell 0.1 to 33.2 hours. Average hourly earnings of all private workers fell $0.02 to $23.98. Average hourly earnings of private service-providing employees fell $0.02 to $23.69.

Real wages have been declining. Add in increases in state taxes and the average Joe has been hammered pretty badly. For 2013, one needs to factor in the increase in payroll taxes for Social Security.

For further discussion of income distribution, please see What's "Really" Behind Gross Inequalities In Income Distribution?

BLS Birth-Death Model Black Box

The BLS Birth/Death Model is an estimation by the BLS as to how many jobs the economy created that were not picked up in the payroll survey.

The Birth-Death numbers are not seasonally adjusted, while the reported headline number is. In the black box the BLS combines the two, coming up with a total.

The Birth Death number influences the overall totals, but the math is not as simple as it appears. Moreover, the effect is nowhere near as big as it might logically appear at first glance.

Do not add or subtract the Birth-Death numbers from the reported headline totals. It does not work that way.

Birth/Death assumptions are supposedly made according to estimates of where the BLS thinks we are in the economic cycle. Theory is one thing. Practice is clearly another as noted by numerous recent revisions.

Birth Death Model Adjustments For 2012

Birth Death Model Adjustments For 2013

Birth-Death Notes

Once again: Do NOT subtract the Birth-Death number from the reported headline number. That approach is statistically invalid.

In general, analysts attribute much more to birth-death numbers than they should. Except at economic turns, BLS Birth/Death errors are reasonably small.

For a discussion of how little birth-death numbers affect actual monthly reporting, please see BLS Birth/Death Model Yet Again.

Table 15 BLS Alternate Measures of Unemployment

click on chart for sharper image

Table A-15 is where one can find a better approximation of what the unemployment rate really is.

Notice I said "better" approximation not to be confused with "good" approximation.

The official unemployment rate is 7.4%. However, if you start counting all the people who want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.

U-6 is much higher at 14.0%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.

Labor Force Factors

Discouraged workers stop looking for jobs
People retire because they cannot find jobs
People go back to school hoping it will improve their chances of getting a job
People stay in school longer because they cannot find a job

Were it not for people dropping out of the labor force, the unemployment rate would be over 9%. In addition, there are 8,245,000 people who are working part-time but want full-time work.

Grossly Distorted Statistics

Digging under the surface, much of the drop in the unemployment rate over the past two years is nothing but a statistical mirage coupled with a massive increase in part-time jobs starting in October 2012 as a result of Obamacare legislation.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Damn Cool Pics

Travel Tattoos
Funny Demotivational Posters - Part 58
Photos of Ashley Lawrence from Gator Boys
Abandoned Underwater Strip Club

Travel Tattoos

Posted: 02 Aug 2013 06:37 PM PDT

Sometimes the best souvenirs are the ones you keep with you always.

Funny Demotivational Posters - Part 58

Posted: 02 Aug 2013 05:53 PM PDT

Check out these new demotivational posters below and tell me what you think about them in the comments. If you love my demotivational poster collection, please link back to it.

All these posters are really funny and very demotivational. There are hundreds of such pictures in our archive of demotivational posters.

Photos of Ashley Lawrence from Gator Boys

Posted: 01 Aug 2013 08:38 PM PDT

Ashley Lawrence is the only female cast member of Gator Boys reality TV series by Animal Planet.

Abandoned Underwater Strip Club

Posted: 01 Aug 2013 08:25 PM PDT

Sounds impossible, but it's real. The club is located on the shores of the Red Sea in Eilat, Israel. First it was an underwater restaurant, then it was re-opened as a strip club for a while, then shut down altogether about a year ago.