Fisher Capital Management News:China ramps up military use of space with new satellites-report1

Reuters) - China is developing cutting-edge satellites that will allow it to project power far beyond its shores and deter the United States from using aircraft carriers in any future conflict over its rival Taiwan, a report said.

The piece in next month’s Journal of Strategic Studies, a U.K.-published defence and security journal, runs at odds with China’s stated opposition to the militarization of space.

But the report, an advance copy of which was obtained by Reuters, said that the rapid development of advanced reconnaissance satellites to enable China to track hostile forces in real time and guide ballistic missiles has become a key to the modernisation of its forces.

While the United States used to be unrivaled in this area, China is catching up fast, it added.

“China’s constellation of satellites is transitioning from the limited ability to collect general strategic information, into a new era in which it will be able to support tactical operations as they happen,” the report said.

“China may already be able to match the United States’ ability to image a known, stationary target and will likely surpass it in the flurry of launches planned for the next two years.”

Beijing has consistently denied it has anything other than peaceful plans for space and says its growing military spending and prowess are for defensive purposes and modernisation of outdated forces.

But with the recent unveiling of a stealth fighter, the expected launch of its first aircraft carriers and more aggressive posture over territorial disputes such as one in the South China Sea, Beijing has rattled nerves regionally and globally.

China’s space program has come a long way since late leader Mao Zedong, who founded Communist China in 1949, lamented that the country could not even launch a potato into space.

Since then, it has launched men into orbit and brought them home, sent out its first lunar probe and begun longer-term programmes to explore Mars and establish a space station.

The successful missile “kill” of an old satellite in early 2007 represented a new level of ability for the Chinese military, and last year China successfully tested emerging technology aimed at destroying missiles in mid-air.

U.S. Defense Secretary Robert Gates warned earlier this year that advances by China’s military in cyber and anti-satellite warfare technology could challenge the ability of U.S. forces to operate in the Pacific.

“STRATEGICALLY DISQUIETING”

China’s need to use satellites to up its military game became apparent during the 1995-96 Taiwan Straits crisis, when the U.S. dispatched a carrier group after China menaced the self-ruled island with war games, the report said.

Beijing realised it could neither track nor respond to the U.S. ships. The incident also led China to realise it needed the means to keep Washington from using its navy to intervene in a war over Taiwan. Beijing regards the island as a rebel province.

“The most immediate and strategically disquieting application (of reconnaissance satellites) is a targeting and tracking capability in support of the anti-ship ballistic missile, which could hit U.S. carrier groups,” the report said.

“But China’s growing capability in space is not designed to support any single weapon; instead it is being developed as a dynamic system, applicable to other long-range platforms. With space as the backbone, China will be able to expand the range of its ability to apply force while preserving its policy of not establishing foreign military bases.”

More broadly speaking, satellites will be able to help China project power.

“As China’s capabilities grow, with space reconnaissance as an example, it will be increasingly hard to reconcile the rhetoric of a defensive posture and a more expansive capability.” (Editing byBrian Rhoads and Yoko Nishikawa)

Fisher Capital Management News:Will China’s Economy Stumble?305

China, along with other emerging countries, is the great hope for global economic growth.

The developed economies, bruised and aching, are pulling themselves slowly back to their feet after the Great Recession.

As Western consumers and governments struggle to get on top of their debts, they are not going to be the source of booming demand for goods and services they were in the last decade.

China by contrast slowed down a bit in the recession and then rapidly got back to something like full speed.

From 2007 to 2011 China accounted for as much of global economic growth as the G7 leading industrial countries combined.

Essential goodsChina is a very important market for suppliers of commodities; Australian coal and iron ore and Brazilian soy beans for example.

It must be said China is also a big exporter, with a hefty trade surplus. That means in terms of global demand for goods and services overall it takes more than it gives.

But imports are growing so China is providing an increasingly important market for some.

But will the powerful performance be sustained?

There are some of sceptics.

The Wall Street Journal recently declared “after years of housing prices gone wild, China’s property bubble is starting to deflate”.

The result is usually painful. Just look at the US, Ireland, Britain, Spain where bad property market loans have been a central feature in the financial crisis.

Rising pricesThe Chinese authorities are getting increasingly uneasy about inflation.

They have repeatedly raised bank reserve requirements, a measure intended to curb the growth of credit.

And then there is Dr Doom himself, Nouriel Roubini, the New York University Professor, prophet of the financial crisis, warning about China slightly further into the future. He says China could face a “hard landing”.

He thinks the economy is too dependent on investment. Very high rates of investment create excess capacity and they can’t be sustained.

They can leave debt problems in their wake as borrowers who built housing or commercial buildings don’t get the income from them that they anticipated.

The movement of millions of Chinese from the land into the cities will slow – will it also slow economic growth?

Urban shiftLooking even further into the future, there are some longer term issues that could slow China down.

One key element in element in China’s growth has been shifting millions of workers from relatively unproductive work in the countryside to industrial employment in the cities.

That won’t go on for ever.

Professor Barry Eichengreen of California University also warns that fast growing economies do invariably slow down at some stage and it comes sooner in countries with a large proportion of elderly people.

China’s one-child policy and rising life expectancy will put China in that category, he argues.

Jim O’Neill of Goldman Sachs, who coined the term BRICs, for the large emerging economies of Brazil Russia India and China agrees that China will slow down this year, to growth of about 8%.

But he sees what he calls a “happy landing”, which will help bring inflation under control.

And he doesn’t buy the talk of bubbles.

StumbleWhat is pretty clear is that China’s pattern of growth will change. At some stage, the astronomical rates of saving, investment and exports will surely give way to an increasing role for consumer spending.

Investing for exports is not the easy living it was when consumer spending in the developed economies was booming.

Chinese business will increasingly have to sell their goods either to other emerging economies or to Chinese consumers.

The country’s rising and increasingly affluent middle class probably will provide that growing market.

But watch out for a stumble in the near term.

Fisher Capital Management News: Fraud warning for craigslist users, scammers seek financial info227

Staff Reports

Posted: 06/10/2011 12:38:16 AM PDT

SACRAMENTO — A scam targeting users of craigslist continues to be reported to the Better Business Bureau of Northeast California.

The scam, first reported months ago, involves the intended target getting an email shortly after posting an ad with craigslist, the online classified advertisement website.

The person sending the email claims to be the CEO of craigslist and states the consumer has won a computer.

The scammer asks the target to go to a website, where personal financial information is required before the free computer can be claimed.

Officials said the emails are a blatant and somewhat clumsy attempt to commit identity theft.

Names usually associated with the emails, Amy Sanders and Angel Thompson, have no connection with craigslist.

People who feel they are being targeted by fraud should contact the BBB at 1-916-443-6668.

Fisher Capital Management Warning: Kellogg Gets Second FDA Warning on Listeria in 2 Years

A Kellogg Co. (K) cookie plant in Augusta, Georgia, was found to have a “persistent strain” of listeria during a February inspection, including on food-contact surfaces, according to a warning letter from U.S. regulators.

The Food and Drug Administration letter, dated June 7, was sent less than two years after a Kellogg Eggo waffle plant in the same state was shut for similar reasons.

The inspection found flies and pools of water, the FDA said. The letter from District Director John Gridley didn’t say that any products were tainted with listeria, yet said they were “adulterated” and “may have become contaminated with filth.” The Augusta plant makes Keebler and Famous Amos cookies, and is one of five cookie bakeries Kellogg operates in North America.

“While the FDA did not identify specific concerns with the food, we take this situation very seriously,” Kris Charles, a spokeswoman for Battle Creek, Michigan-based Kellogg, said in an e-mail. “We have undertaken a number of aggressive actions to address their concerns including comprehensive cleaning and extensive testing.”

Kellogg’s response didn’t include dates for taking action at the plant, the FDA said. The regulator gave Kellogg 15 days to outline specific remedies to avoid injunction or product seizure.

Eggo Production

Kellogg’s cookies are baked at a temperature high enough to kill any listeria present, according to Robert Gravani, a food science professor at Cornell University in Ithaca, New York. The lack of an FDA product recall suggests that listeria was not found in the cookies, he said. FDA spokeswoman Tamara Ward declined to comment on a potential recall.

Listeria is a bacterium found in prepared foods and soil that can cause a serious infection in humans called listeriosis. It is particularly harmful to pregnant women, the young, the elderly, and people with weak immune systems, according to the FDA’s website.

Kellogg, the largest U.S. maker of breakfast cereals, fell 45 cents to $54.96 at 4 p.m. in New York Stock Exchange composite trading. The shares have gained 7.6 percent this year.

The FDA in January 2010 ordered Kellogg to improve sanitation controls at the different Georgia plant after Eggo buttermilk waffles were found contaminated with listeria bacteria. That, along with flooding and equipment changes at another waffle factory in 2009, slowed production for months and caused Eggo’s market share to drop.

Kellogg in June 2010 voluntarily recalled about 28 million boxes of cereal including Froot Loops and Honey Smacks, citing unusual taste and odor coming from the liner of packages. The recalled boxes were made at an Omaha, Nebraska, facility. North American cereal sales dropped 5 percent in 2010, partly because of the recall.

To contact the reporter on this story: Matthew Boyle in New York at Mboyle20@bloomberg.net.

To contact the editor responsible for this story: Steve Walsh at swalsh@bloomberg.net

Fisher Capital Management News: Steve Jobs pitches new Apple ‘spaceship’ campus to Cupertino City Council

Apple CEO Steve Jobs revealed plans for a new headquarters for the company that “looks a little like a spaceship” at a City Council meeting in Cupertino, Calif., on Tuesday.

In his trademark black turtleneck, jeans and gray New Balance running shoes, Jobs said at the meeting the new building would hold 12,000 employees, and even house its own green-energy power plant.

Apple’s current headquarters can only hold about 2,800 people, Jobs said, according to a YouTube video of his presentation posted by the council.

“We’ve got almost 12,000 people in the area,” he said of Cupertino. “So we’re renting buildings — not very good buildings, either — at an ever-greater radius from our campus and we’re putting people in those. And it’s clear that we need to build a new campus.”

The new facility, as Apple envisions it, would be built on about 150 acres of land that the tech giant owns down the street from its current headquarters.

Jobs said Apple’s plan would involve demolishing buildings now on the site and constructing a new ring-shaped building that would be four stories tall, with four floors of parking underneath.

In the process, the project would increase landscaping to make up about 80% of the site, which is only about 20% trees, plants and grass now, he said.

On Monday, Jobs was on stage in San Francisco, revealing Apple’s new iCloud service at the company’s Worldwide Developer Conference. Public appearances such as the two Jobs has made this week have been rare this year as the Apple co-founder has been on a leave of absence for medical concerns since January. He also announced the iPad 2 in March at an Apple event.

“It’s a little like a spaceship landed,” Jobs said of the planned facility. “It’s a circle, and so it’s curved all the way around. As you know if you build things, this is not the cheapest way to build something. There’s not a straight piece of glass on this building, it’s all curved.

“And we’ve used our experience in making retail buildings all over the world now, and we know how to make the biggest pieces of glass in the world for architectural use.”

The proposed campus wouldn’t rely on Cupertino’s power grid for energy. Instead, it would run from an on-site power facility.

“I think what we’re going to end up doing is making the energy center our primary source of power, because we can generate power with natural gas and other ways that can be cleaner and cheaper, and use the grid as our backup,” Jobs said. “We think that makes more sense.”

Mayor Gilbert Wong said in a statement that Cupertino is excited that Apple is moving forward with a new campus, an idea first mentioned to the city in 2006.

“When Apple submits their building plans later this year, we know that we will be looking at a state-of-the-art facility and all the challenges and opportunities that go along with that,” Wong said.

The review process for the new Apple campus will be the same as any other construction project, with evaluations of environmental impacts, air quality, traffic and other matters, he said.

“The project will come to the City Council for approval in the fall of 2012,” Wong said. “Following approval, Apple can submit building permits. Construction will follow, and Apple and the city expect the new campus to be completed by 2015.”