IT and The Economy Summer 2009

Dr.
Jimmy Schwarzkopf
Research Fellow
STKI
jimmy@stki.info
http://drjimmystki.blogspot.com/
1
Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 1
Do not remove source or attibution from any graphic or portion of graphic
2
Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI
YOU will get an email
that allows you to
login
www.docsntalks.com
Separate
group per
roundtable
topic
STKI Summit 2009

All “downloadable”
Presentations will be
www.docsntalks.com
5
Presentation Agenda
1 The past year an “educated guess”
2 How does it matter in IT
3 Major changes in IT technologies
6
Presentation Agenda
1 The past year an “educated guess”
2 How does it matter in IT
3 Major changes in IT technologies
7
• Evariste Galois (1811-1832)
– accepted a duel with pistols (lack of
wisdom)
– spent the night before the duel in
ThreehisKinds
writing down of Learning:
mathematical
testament:
1. theory ofthat (academic)
Knowing
transformation of roots in
2. Knowing how (applied)
algebraic equations (creating
science) 3. Knowing why (analytical)

• Evariste Galois (1811-1832)
– accepted a duel with pistols (lack of
wisdom)
– spent the night before the duel in
writing down his mathematical
testament: theory of
transformation of roots in
algebraic equations (creating
science)

Facts: financial meltdown in 5 steps

REAL ESTATE BUBBLES
• Real estate “Bubble” all over the world
– The belief that everybody should own a home
– The belief that “real estate” value increases more than inflation.
• SEPARATION of “loan agent” from “mortgage
holder”
• SUBPRIME MORTGAGES
• SECURITIZATION OF MORTGAGES
• as long as real estate prices kept rising and interest rates remained low.
• Wall Street bundled mortgages into securities, bundled riskier loans
(subprime mortgages) with better risk loans, decreasing risk, hard to
assess the value of the loans.
11
China Inc: USA T-bills Republic
• Trade with China turned out to be fair and balanced :
”They sold the USA poison toys and tainted food; the USA
sold them fraudulent securities “
• FLOATING EXCHANGE RATE ?. rise in the value of YUAN, would slow

the growth of exports; in terms of the dollar it had to be fixed, the
government had to buy all dollars and give Yuans to the exporters.
• Trade surpluses kept growing —acquired $2 trillion in Tbills
• DEEP STRATEGY behind accumulation of low-yielding Tbill assets?
• NO …
• today they plea that someone will rescue them from the consequences of
their own investment mistakes
12
Crime Inc.
• UN estimates organized crime’s annual revenues are
3% of the world’s GDP, over $1 trillion
– half in drug sales
– the rest in multi-service activities : control of legal and illicit
gambling establishments, arms trade, human smuggling, traffic in
body organs, car theft, prostitution and racketeering
• International Monetary Fund estimates that ILLICIT
FUNDS worldwide amount to:
– about $2 trillion
– These funds usually move into unregulated institutions

Credit Default Swaps
CREDIT DEFAULT SWAP (CDS or CDO)
• like insurance, buyer pays a premium and, in return, receives
a sum of money if events occur….. but :
• the seller need not be a regulated entity;
• the seller is not required to maintain any reserves to pay off buyers

The shadow banking system crashed taking
the whole world economy down.
Asset comparison:
• Assets of regulated banking system
– $10 trillion
• Assets of shadow banking system:
– Hedge funds ………….$ 2.5 trillion
– Investment Firms ….$ 6.0 trillion
– Other ……………..……..$ 4.0 trillion
Anything that does something like a “bank”;

Anything that has to be rescued in crises the way banks are;
Should be regulated as a bank

Does somebody know what is going on??



ECONOPHYSICS
• Rejects the traditional view of
the economy as a fully
transparent, rational system
striving toward equilibrium.
• Uses concepts and

mathematical models that draw
on complexity theory and
statistical physics to understand
economic, business and IT cycles
.
EFBP or El Farol Bar Problem
• people considering going to the bar were
wondering whether or not it would be
overcrowded that night…………
• If everyone uses the same strategy for deciding
whether or not to go to the bar the bar will be
either full or empty each night.
• EFBP cannot have a standard, generally
agreed, “rational” solution because:
– If everyone acts rationally. Then everyone will lose.
And the pub will go out of business.
• What society needs. …is for everyone to act
irrationally, in accordance with whatever
personal hunch they have at that time

QUANTS
MATHEMATICAL MODELING OF
HUMANITY
• great undertaking of the 21st
century
• turned the world of content
into math, and turned
investment decisions into math

Prediction using mathematics
The POWER and the S LAW phenomenon, seems to be
applicable to a wide range of currently relevant economic
and technological outcomes, including financial crises,
industrial production, corporate bankruptcies
it can even describe how industry structures evolve.
22
23 23
www.KurzweilAI.net
‘Power curves’
• The power law

phenomenon seems
to be applicable to :
– financial crises,
– industrial production,
– corporate
bankruptcies
– IT spending

“The only function of economic forecasting
(STKI-IT forecasting included)* is to make
astrology look respectable”
John Kenneth Galbraith
* my additions 25
The S-curve Flow of Economics
The Real Financial

Economy Economy
(produces (moves
value) capital)
VALUE:
production
of goods Money/capital
and
services
26
Technologies that changed the way we do things
Productivity changes per hour worked

4 Professors and 1 School
1. Profs. Prescott & Kydland
– REAL ECONOMY CYCLES influenced by the technology
that converts inputs of capital and labor into output of
goods. Technology creates value, changes productivity
and produces cycles
2. Prof. Carlota Peres

– Technological Cycles change “best business practices”
– These cycles create explosive growth and change
– Everything changes: the way we work, live, play
– Technology influences financial markets
28
3. Prof. THOMAS KUHN :
• Real economy and technology advance in a peaceful
way interrupted by violent change revolutions
• PARADIGM SHIFT: A change in world view that calls
everything you know into question and each world
view is replaced by another
4. Prof. Joseph Shumpeter :
• Innovation is the basis of technological change
through “Creative Destruction”
• Markets do not know how to do Price Adjustments
for Technological Innovation
• Produces also Financial Innovation (usually
unregulated) that tend to eventually burst
29
Austrian-School of Economics
government interventions: credit cycle theory
• Governments (central banks) tend to "artificially"
set interest rates too low for too long with wrong
regulations
– Low interest rates tend to stimulate borrowing
– Leading to an unsustainable "monetary boom“
(FRENZY)
– Financial institutions get caught in the frenzy
– Shadow banking system starts to “ease”
movement of money
– "credit crunch" "recession" or "bust" – occurs
when this frenzy cannot be sustained.
30
FRENZY:
success, excess demand and GREED
SUCCESSES ATTRACT
of the new all available money towards
entrepreneurs… the technological revolution
…attracting even more Spectacular

profits
funds and preparing

and growing
capital gains
the inevitable collapse!!!

GREED:
makes many unprofitable Excess demand
projects appear viable… in the stock market
ASSET INFLATION

FIVE TECHNOLOGICAL REVOLUTIONS IN
230 YEARS
32
S curves for Economic progress
DRIVEN BY SUCCESSIVE TECHNOLOGICAL REVOLUTIONS
Technological
progress
Time
40-60 years
33
SOCIAL REVOLT
technology/economic cycles
Austrian
Degree
Perez new
INSTALLATION PERIOD Turning
Point
DEPLOYMENT PERIOD School
of diffusion
of the PARADIGM forecast
Institutional recomposition and role shift

technological
revolution MATURITY
“Creative destruction” SYNERGY Kuhn’s
Defeat of the old “boom”
financial capital
“golden age” to maturity
FRENZY growth and social benefits
production capital
ERUPTION
Schumpeter’s
? Creative
big-bang Next
destruction
big-bang Time
2O - 30 years ??? 2O - 30 years
The Age of Steel
and Heavy The Age of Information Technology
Engineering and Global Telecommunications
The Age of Oil, Automobiles
Bubble, Corporate scandals & 2008 Recession…

and Mass Production
1894-1920
MATURITY
1960-74
SOCIAL UNREST MATURITY
Depression 1930’s and WWII

Social unrest mature industries CHINA Inc.
1943-59 1968-70 to Third World
SYNERGY
Financial Capital Financial Capital
Post war
Regulations Golden Age Regulations
Break down Break down
1920-29
Production Capital 1987-2008
FRENZY FRENZY
New 1971-87
regulations ERUPTION Internet
1908-1920 Roaring Transistors; computers; & Telecoms
ERUPTION Twenties analog instruments; mania
Oil and
automobiles (USA) numerical control
Mass production
ICT Revolution
Crash Bretton Woods 1971 and stagflation Starts with the
1929 Welfare State Intel Internet bubble
1908 Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI Marshall Plan Micro-processor 2008 Global meltdown
Ford Model-T Do not remove source or attibution from any graphic or portion of graphic
Israel in the Rankings

Amount of ‘big” IT (in Israel) instalations
has decreased in the last 3 years
40
But…. How bad is it?

How bad is this “recession” ?

Job Losses in USA
http://flowingdata.com/about-nathan/

Business survey: Total business sector
Data source: Bank of Israel Research

One of the lowest employment rates in OECD
Israel 2006

But using another stat:
percent fully employed adults
--4%

low per capita ($ USD) IT expenditure
IT spending in Israel is 2.71% of GDP

European Union IT spending is 3.3% of GDP
$ 600 USD <
European Union per capita spending on IT amounts to 1100 €
Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 47 * IT spending data by STKI

GDP per hour worked (*5)… excellent
indicator but data is usually 3 years behind
IT Market change
Change in GDP per hour worked (*5)
48
Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 48spending data by STKI
* IT 48
But in real time: State of the Economy
Index as an “indicator “ of IT investment
State-of-the-
IT market growth rate
economy index is
an indicator for
examining the direction
in which real economic
activity is moving, in
real time. (Bank of
Israel) 1 2
Deviation from the

trend is calculated via
the Markov-switching
model and enables the
turning points in the
business cycle to be
identified at an early
Deviation from the trend (*10) 1 2
stage. (Bank of Israel)
All IT spending data by STKI 49

Glint of Hope for IT Spending in
Second Half of 2009
The ChangeWave survey

was conducted May 11-12
1,939 respondents
involved with
IT spending in their
organization participated

Forecast: Goldman Sachs IT spending

Sales forecasts in USA

-”The world economy has avoided "utter catastrophe“
and industrialized countries could register growth this year”-
May 25, 2009 (Reuters) Nobel Prize-economist Paul Krugman
-”The global economy had come out of "free fall,“

offering hope of incipient recovery late this year”-
May 22, 2009 (Reuters) — OECD
-”The U.S. economy is stabilizing, but has a long way

to go to recover from its current recession “-
May 27, 2009 (Reuters) — Treasury Secretary Timothy Geithner
-”The pace of contraction in world economic

output appears to be easing and recovery
could begin at the end of this year”-
May 22, 2009 (Reuters) — OECD chief Angel Gurria
-”China's economy has already bottomed out from the economic

slowdown and entered a recovery phase ahead of other countries”-
May 22, 2009 (Yomiuri Shimbun) Kwan Chi Hung,
Senior Fellow of the Nomura Institute of Capital Markets Research

Don't get too excited about some
recent brighter economic news
It has been a cheerful couple of days for
those starved of bright economic news.
Hopeful statistics have been trickling
in from many parts of the world.
1.-signs that might point towards the beginning

of the end of the “Great Recession”.
2.-more sober analysis would suggest there is a
long way to go before recovery sets in.
IT market share (%) by INDUSTRY

Industries 2003-2009
All amounts in K
M$$USD
USD
How recessions affected IT vendors
59
Recession cost reductions

‫ הביקוש לעובדי הייטק ירד‬,2009 ‫ ועד מרץ‬2008 ‫מאז אוקטובר‬
‫ הביקוש לעובדי הייטק במרץ‬,2008 ‫ בהשוואה למרץ‬.34%-‫בכ‬
36%-‫ היה נמוך בכ‬2009

A little history……….
62 62
When is the right time to change??

Frogs forecast “earthquakes”

Post-recession:
Create New Value Proposition ?
66
So what do we do in the “New Era” ?

Business Process Innovation
High
Improve: SURVIVE Innovate : GROW Invent: CHANGE
Business Performance
Contribution to
2012
4Q 2009 2011
2010
2010
2009
Low
Redo Existing Rethink Redefine

Processes Business Business
68
70
“Wealth in the new economy flows directly
from innovation, not optimization”
Kevin Kelly
Wired Magazine
71
Inclusive Knowledge Society with
Multiple Compensatory Safety Mechanisms
20th century: 21st century:
Mass Production Economy Information & Service Economy
DIVERSITY
HOMOGENEITY HYPER SEGMENTED MARKETS:
SEPARATION OF INTEGRATION OF MIND /HAND

MIND AND HAND Knowledge Worker
Blue collar White collar T education
Work TIME and PLACE

of WORK
Revenue, profit Revenue, profit, ROY

and ROI and RISK
UNAVOIDABLE CAPACITY FOR

ENVIRONMENTAL ENVIRONMENTAL
DESTRUCTION PROTECTION

Can you see the difference??
• BEFORE
– We sold “products”
– We “productized” services
• NOW
– We will sell “services”
– We will “servicerize” products

What will happen here?
• pay for service and
get free phone?
• pay for phone and get
free service?
• pay for use of
application and
content and get free
phone and service?

Hyper Segmented Markets
Long Tail Vs. Pareto Law
95.5%
76
Hyper Segmented Markets
Long Tail Vs. Pareto Law
77
No balance between work and leisure (home)
• Prof. Ragnar Frisch
– time the most precious resource an individual has
– very difficult to find balance (impossible)
• Prof. Israel Kizner
– A market with men unable to learn: in other words
COMMODITY PEOPLE… needs a group of outsiders
T PEOPLE who are able to perceive opportunities
– This group of entrepreneurs…notice profit
opportunities that exist because of the initial
ignorance of the original market participants and
that have persisted because of their inability to
learn.
78
People as “commodities”

People as “commodities”

BLACK SWAN
So the black swan doesn’t have feathers. The black swan

is an event with three properties:
1. its probability is low, based on past knowledge.
2. although its probability is low, when it happens it has a

massive impact.
3. people don’t see it coming before the fact, but after the
fact, everybody saw it coming. So it’s prospectively
unpredictable but retrospectively predictable.

BLACK SWAN
So the black swan doesn’t have feathers. The black swan

is an event with three properties:
1. its probability is low, based on past knowledge.
2. although its probability is low, when it happens it has a

massive impact.
3. people don’t see it coming before the fact, but after the
fact, everybody saw it coming. So it’s prospectively
unpredictable but retrospectively predictable.

21st century: affects firm performance:
RISK and UNCERTAINTY
Humans cannot understand
uncertainty/risk
Figure out how to measure RISK,

manage it and hold managers accountable for it.
Just as revenue growth, productivity and profit .
83
Enterprise Risk Management
• According to any “new age” theory:
– Management proposes OPTIONS to

the CEO/Board and also shows the
RISKS each of them carries.
– Risk also changes with TIME
– This process is called:
“ENTERPRISE RISK MANAGEMENT”

Development of the
risk management function
1990s 2000s 2010+
Focus on loss Focus on Focus on link to Focus on stakeholder
performance &
Aligned to business drivers
prevention governance & profitability

capital efficiency
reporting Focus on Integrated
alignment to Risk & Value
Focus on risk objectives Management
quantification
Integrated
Performance Management
Institution-Wide
Objectives-oriented Risk Management
Risk Management
Value-at-Risk
Risk Monitoring
& Reporting
Risk Control
Frameworks
Integrated across risks / businesses

Enterprise Risk Management
Customer Demand Shortfall Cost Overruns

24
Accounting Irregularities
Competitive Pressure
Management Issues
M&A Integration Problems
Supply Chain Issues
11
Product Issues
12 Foreign Macro-Economic
Customer Pricing 7 7
7
6 Commodity Prices
6 Loss of Key Customer
4 3 Interest Rates
2
2 1
1 1 1
0 0
Strategic Operational Financial Hazard
58% 31% 6% 0%
Competition in services?
Business Process Improvement
New Business Model
87
CIOs will do BPI in 2009
IT of
Competitor
Value Business
1
ERP captured Process 1 Market
by
verticals
No Real Competitive Sales

difference in value Differentiation Prospect
IT of
Competitor Value Business
ERP captured Process 2
2
by
verticals

CIOs will do BPI in 2009
IT of
Competitor
Value Business
1
ERP captured Process 1 Market
by
Best verticals
Projects
Business
No Real Competitive Sales
difference in value Differentiation
For Prospect
IT of Practices
Competitor
2
ERP Value
captured
by
2009/10
Business
Process 2
verticals

Key challenge for new IT:
Information moves
where needed
and
not
everywhere it can
2009-11: BI and DATA MINING
Data
Warehouse
MDM

Post-recession IT

The IT ecosystem:
COST OF DELIVERING versus COST OF BUYING
Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 94 * From SYMANTEC

The IT ecosystem:

The IT ecosystem:

Factories get to nearly full utilization….
IT should also…..

Datacenters today have 30% utilization
100s different
Energy waste Software
products
30% max in 25%

Storage utilization
Utilization x86 servers
Ala-carte
telecomm Hundreds of
services Enterprise
Processes 98
Managing the IT capability
• Utilization is all about:
– Virtualization
– Automation
– Standardization
– Provisioning
• Things to do :
– ITIL, CoBIT, ISO 17799 (discipline & efficiency)
– IT system performance management
– Application Rationalization
– AGILE project development
Standardized Equipment
Economies Of Scale
100
Application Rationalization
• An assessment of applications will
show what applications have to
canceled and which should remain.
• If usage continues, then which have
high HATMAA and which do not:
– LOW HATMAA need special tools and
re-training
– HIGH HATMAA need tool for constant
reinforcement
Which applications are over
supported and which under
supported.
Standardized Services
Economies Of Scale
“Application Image” is a sum of

infrastructure services and software
services needed to deliver an IT
product
Two types of IT services:
1. Infrastructure Services or Ensembles

2. Software Services or Mashups
102
Service-Oriented Infrastructures
Infrastructure Services

Service-Oriented Architecture

WOA (mashups) vs SOA: evolution

The MASHUP “dream”
MASHUPS
(BPM) Process Manager
MDM
assembly engine
Master data manager
Enterprise Integration Bus
Front- & Workflow

eBusiness Financial
Backoffice Management
System System
System System
Legacy CRM SCM
System System System

The new Service-Based IT
107
Traditional versus Cloud

Delegating the Power to the Cloud

A huge paradigm shift is underway

Cloud example
CLOUD Services SQL
MAIL Workflow
Access Data
Security Portal
Control
SaaS
ERP
CRM
STKI
drjimmys@gmail.com Raanana Yoni
Mail CUTTER
EDM
jimmy@stki.com DRP*
Hosted at XXX New York Karen
Post-recession:
114
It’s Time for Every Organization to Ask:
“Which Path Will We Choose?”

Computing Platform Lifecycle

Platform vs. Open vs. Reliable
• Obama staffers
could not work:
a "generation" gap
in technology
• Looks like the Bush
administration, like
many organizations
worldwide, used
old reliable
Microsoft

end of commodity hardware
• HP/Dell typically pay $60 to
$150 for Vista
• Can use the older Windows XP
for roughly $15 for netbooks
(until 10/2009)
• HP/Dell make only about $20 in
profits on a $400 netbook
• Windows 7 : pricing from $50 to
$350 (Windows 7 Home Premium $200 )

end of commodity hardware
• HP/Dell typically pay $60 to
$150 for Vista
• Can use the older Windows XP
for roughly $15 for netbooks
(until 10/2009)
• HP/Dell make only about $20 in
profits on a $400 netbook
• Windows 7 : pricing from $50 to
$350 (Windows 7 Home Premium $200 )

1980 -2010 Platform Lifecycle

Innovation will come from?

Industry in a Box

Other ecosystems: blackberry

iPhone Ecosystem:
40 million devices and 50,000 applications

Ecosystem:
Information access & analysis
Exploding volumes of 1. Tools for finding and
digital information (video,
audio, images, text,
making sense of the
transactional data, etc) information.
2. Tools for data
cleansing.
3. Tools for minimizing
duplication.
4. Tools for storage
management.
5. Tools for backup
management.
125
Industry in a Box

Industry in a Box

Industry in a Box Companies

What will they do ?????

Software: M&As expected

66% of HP is hardware (most commodity)
80% of IBM is focused on software and services
Which is the right “NEW” IT vendor business model

???????

When is the right time to change??

Transformation of IT:
CIO priorities for 2009
1. Cost reduction 9. Storage virtualization
2. DRP/BCP 10. Desktop virtualization
3. Server virtualization 11. Data De-duplication
4. Server consolidation 12. Governance, risk
5. BI/DW management and
6. Security compliance
7. CRM 13. Self-service
8. WAN Optimization/ 14. Mainframe
application optimization
acceleration 15. Open Source
134
The new Economy

METAweb: web 3.0
Connecting “INTELLIGENCE”
136
New “search engines”

Post-recession:
138
In a battered economy, free
goods and services online are
more attractive
METAweb
than ever.
New
So how can the suppliers make
Business
Model
a business model out of
nothing?
139
WEB 1.0: Media companies put content in the
web and push it to users
.
Low content variety

Content production is slow and expensive
Professional authors Managers

Create content based on what they Hand-manage publishing
think people want businesses
Push! Push!
Users = consumers
Users consume professionally
produced content
140
WEB 2.0: New platforms allow users to
generate content themselves
User generated content High content variety

Blogs, videos, photos, music etc. dramatically increases, while
technical quality goes down.
Authoring platforms
enable everyone to publish!
Web2.0 managers
are hand-managing the
platforms
Professional authors
can still publish, but are competing
with – everyone!
Users = authors
users generate content
141
WEB 2.0 in business

Croudsourcing: Markets 2.0
• Traditional market 1.0 model: Traditional Market 1.0 Model
central organization serving many
individuals
– Large-scale impersonal markets
– Low preference expression
• Market 2.0 model: flexible dynamic Market 2.0 Models
capital allocation systems that provide

democratic, more immediate, low-cost,
affinity-directed capital Many: One
Peer finance
– Benefits to individuals: freedom, One: Many

Affinity purchasing
convenience, preferences articulation
– Benefits to groups: virtual aggregation
of group power to conduct transactions Many: Many
Prediction markets
Peer philanthropy

143
Books you should read: crowdsourcing
144
METAweb = web3.0
user generated (mind) business
A simple idea:
a technology so effective that

every mind can make a living
of its creativity, instantly.

METAweb: Business platforms empower
everyone to become a (media) entrepreneur
Business tools
Full scale media management tools for everyone
User generated content
Blogs, videos, photos, music etc.
User generated business
Premium content, advertising, e-commerce
Authoring platforms Business platforms

enable everyone to publish! Everyone can manage
Publish Build business
Users = entrepreneurs
users generate business!
146
So what are the differences ?
web1.0
web2.0
METAweb
Creation Delivery Management
147
When will be stop “imitating paper”?
The Austin 7 was produced

from 1922 through to 1939
by the Austin Motor Company.
The Karl Benz Patent Motorwagen (or

motorcar), built in 1885, is widely regarded
as the first automobile, that is, a vehicle
designed to be propelled by a motor.

What do I use ????
• No longer need a • Blogs:

memory • IT related
– Google • Economics
– Yahoo • Musical taste:
– Wikipedia – ITunes
– Twitter • Books and others:
– Amazon
• Personal Information • Social Capital
– Smartphone tells me – LinkedIn
about birthdays, phones, – groups
addresses
– Xing
– Facebook
149
Study by Prof. Granovetter shows that
weak links are better than strong
• Strong Links: More
motivation to help you,
since they know you
better
•Weak Links : Likely less
overlap with leads you
can easily get elsewhere
Most job referrals come

through those who we
see rarely: old school
friends, former co-
workers, etc.
Lifecycle of a “social network”

All Rights Reserved 2008@STKI Moshav Bnei 152
What do you use ?
Social
Technographics™
Josh Bernoff, co-
author of Groundswell
153
Post-meltdown REVOLUTION
4The real, long-term change is just beginning
The revolution may have
to be felt, and anyone thinking about our
started in a garage in California
economic future should consider this:
• access to information is a democratizing
but it has already crossed
force
Your Text here Your Text here
every border
• makes it inexpensive and easy to collaborate
and share information.
moving as freely
• even the smallest companies can now have
around the globe as a cloud
as big a presence online as a multinational
corporation
Thank you
Dr. Jimmy Schwarzkopf
http://drjimmystki.blogspot.com/
jimmy@stki.info

IT and The Economy Summer 2009

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IT and The Economy Summer 2009

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Dr.

STKI Summit 2009

1 The past year an “educated guess”

2 How does it matter in IT

3 Major changes in IT technologies

1 The past year an “educated guess”

2 How does it matter in IT

3 Major changes in IT technologies

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 8

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 9

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 10

• FLOATING EXCHANGE RATE ?. rise in the value of YUAN, would slow

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 14

Anything that does something like a “bank”;

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 15

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 16

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 17

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 18

• Uses concepts and

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 20

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 21

• The power law

Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI 24

The Real Financial

Productivity changes per hour worked

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2. Prof. Carlota Peres

…attracting even more Spectacular

funds and preparing

the inevitable collapse!!!

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Institutional recomposition and role shift

Bubble, Corporate scandals & 2008 Recession…

Depression 1930’s and WWII

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IT spending in Israel is 2.71% of GDP

European Union per capita spending on IT amounts to 1100 €

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Change in GDP per hour worked (*5)

Deviation from the

All IT spending data by STKI 49

The ChangeWave survey

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-”The global economy had come out of "free fall,“

-”The U.S. economy is stabilizing, but has a long way

-”The pace of contraction in world economic

-”China's economy has already bottomed out from the economic

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1.-signs that might point towards the beginning

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Dr. Jimmy Schwarzkopf’s work Copyright 2009©STKI