Tuesday, May 24, 2016

Time to Fold

Dealing from the bottom of the deck:

"Gambling revenue ticks up at Plainridge Park Casino" by Sean P. Murphy Globe Staff  May 16, 2016

Gambling revenue at Plainridge Park Casino ticked up almost 2 percent in April, building on gains that have brightened the financial outlook at the state’s first casino.

The Plainville slot parlor brought in $13.3 million last month, about $8,000 more a day than in March, according to an analysis released Monday by the Massachusetts Gaming Commission.

So far this year, Plainridge is averaging $13 million in monthly revenue, up from $12.2 million over the last four months of 2015.

“The fact that revenue is up is a good sign for Plainridge Park,” said Paul DeBole, an assistant professor of political science at Lasell College and a specialist in gambling regulation. “I’m cautiously optimistic that the upward trend will continue.”

The modest upturn, however, comes as the casino has sharply increased promotional free play, enticing gamblers with offers of hundreds of dollars of free slot machine credits. In an advertising campaign splashed on television and highway billboards, the casino invites patrons who sign up for a rewards card to “Play up to $500 on us.”

In February, Plainridge handed out $2.4 million in promotional credits, an unusually high amount for a relatively small casino.

The commission stopped publishing what Plainridge spends on free play in its monthly reports after Plainridge argued the disclosure placed it at a competitive disadvantage.

The casino will face a major new competitor next summer, when the Mashpee Wampanoag tribe is scheduled to open the first phase of its First Light casino in Taunton, about a 30-minute drive from Plainridge. The $1 billion casino will feature a full array of table games and be far larger than Plainridge.

“When the Mashpee casino in Taunton opens, there could be an adverse impact on Plainridge,” DeBole said.

Plainridge already faces stiff competition from Twin River Casino, 11 miles away in Lincoln, R.I. Twin River offers more than 4,000 slot machines, table games, and a 3,000-seat arena.

Under state law, Plainridge is restricted to 1,250 slot machines and no table games.

Lance George, Plainridge’s general manager, said the casino is constantly working to improve its reach in a crowded marketplace. “We’re continuing to focus on refining our marketing efforts,” he said.

Despite the rally this spring, the casino has fallen well short of revenue forecasts, which estimated it would bring in as much as $300 million in its opening year. In its first 10 months, the casino took in $134 million, putting it on pace to collect about $161 million for the year.

The state taxes Plainridge’s gambling revenue at 49 percent, most of which goes to cities and towns. Since the casino opened last June, municipalities have received almost $54 million from casino revenue.

The state’s 2011 casino law also requires that a sizable chunk of the revenue — more than $12 million to date — subsidize the horse-racing industry.

That can take up your entire day.

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What do you mean you don't know how to play?

"State panel gets primer on ‘social casino games’" by Sean P. Murphy Globe Staff  May 10, 2016

Millions of people are spending a lot of time — and money — on social games like “Candy Crush” and “Angry Birds” that are widely accepted as harmless pastimes, representatives of the online gaming industry told the state Gaming Commission on Tuesday.

Harmle$$?

Social casino games, which mimic slot machines and table games without allowing actual wagers, are no different, the representatives said.

Luc Delany, chief executive officer of International Social Games Association, a social gaming trade group, said he does not consider social casino games “to be gambling at all.”

People who play slots and other games online clearly understand the difference between online social gaming, a growing trend in the casino industry, and actual casino gambling, he said.

“The online casino games take their inspiration from real money games,” he said. “But we think people enjoy them because they don’t take any actual risk of losing money when they play online.”

Delany spoke at a three-hour commission meeting held to discuss social casino games, which critics say are addictive and misleading. Plainridge Park Casino, a slot parlor and the state’s first casino, offers an online slot machine that lets players win credits to make the leaderboard and open up new levels of play.

“It’s pretty clear there are some risks,” said Keith Whyte, executive director of the National Council on Problem Gambling. “When you simulate gambling online, whether for money or not, you can develop a gambling problem or exacerbate a problem.”

Could even wind up in court.

Whyte said the casino industry and its regulators should discuss voluntary guidelines to protect players. While it’s not clear whether online games help casinos recruit new players, gamblers who play online seem to wager more at brick-and-mortar casinos, he said.

Gaming Commission Chairman Stephen P. Crosby said there is no evidence that online casino games lead to problem gambling. But Crosby said the panel had a better grasp of the subject and would invite Penn National, the owner of Plainridge Park Casino, to discuss the topic at a future meeting.

“I would like to know what Penn is doing now that we have better understanding of the issues,” Crosby said.

Representatives of Wynn Resorts and MGM Resorts, which are also licensed in Massachusetts to operate casinos in Everett and Springfield, respectively, will also be invited.

Members said it is an open question whether the commission has jurisdiction over social gaming but wanted to learn more about the potential risks.

The commission scheduled the meeting after a Globe article cited concerns about online slot machines among critics of problem gambling.

I have mine, but it is with help.

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Time to stop counting cards.

Pfizer Finds Fountain of Youth

It flows from $cratching:

"Pfizer to buy skin drug maker Anacor for $5.2 billion" by Linda A. Johnson Associated Press  May 16, 2016

TRENTON, N.J. — Pfizer is fortifying its key immunology and inflammation drug business, snapping up a small maker of skin treatments for about $5.2 billion, weeks after the Treasury Department torpedoed Pfizer’s planned $160 billion deal for Allergan PLC.

Pfizer Inc.’s agreement on Monday to acquire Anacor Pharmaceuticals Inc., a money-losing developer of topical skin treatments, is the latest move by the biggest US-based drug maker in a years-long struggle to accelerate growth.

Pfizer, known for Viagra and the pneumonia vaccine Prevnar 13, had been counting on acquiring Dublin-based Allergan and moving its headquarters — on paper — from New York to Ireland to reduce its tax bill. But on April 5 Treasury issued rules governing ‘‘tax-inversion’’ deals, removing the financial incentives for buying Allergan.

With California-based Anacor, Pfizer gains an experimental eczema treatment that could be approved by the Food and Drug Administration by January, plus US rights to the topical toenail fungus treatment Kerydin and a portfolio of other drugs in early testing.

If approved, the topical eczema medicine, crisaborole, would be the first new medication type in 15 years for eczema, also known as atopic dermatitis. About 18 million to 25 million people in the United States have the chronic skin disorder, which causes inflammation and itching, often lasting two weeks or more.

Pfizer, which sells the blockbuster drug Enbrel for plaque psoriasis and other immune disorders, said peak annual sales of crisaborole could reach or exceed $2 billion.

Albert Bourla, group president of Pfizer’s vaccines, oncology, and consumer health care businesses, called the buyout attractive because there are few safe topical eczema treatments.

Anacor holds rights to Kerydin, which is marketed in the United States by Sandoz, the generics division of Swiss drug giant Novartis AG....

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"‘Second skin’ goes on over your real skin to smooth your wrinkles" by Ike Swetlitz, May 9, 2016

It starts out like any one of a number of anti-aging treatments: rub some goo on your face, wait for it to dry. But this isn’t a skin cream or wrinkle serum, it’s an invisible polymer “second skin” that dries to tighten wrinkles and reduce skin sagging.

“You put it on as an ointment, and it becomes a patch,” said Robert Langer, professor at the Massachusetts Institute of Technology and a founder of Olivo Laboratories, the company developing the fake skin. Researchers detailed the technology in a new paper published Monday.

Put on as a daily mask, the skin becomes a kind of temporary cosmetic intervention. Further out, its developers hope the fake skin could be loaded with medications that would be absorbed through a person’s real skin.

To put on the skin, you apply two gels. The first is clear; the second, cloudy. As the gels dry, they harden into a flexible film that sticks onto your real skin not unlike the clear part of a temporary tattoo. After a few hours, it’s difficult to see the boundary between the two — the silicon-based material is specially designed with a matte finish so that it doesn’t draw attention. This stands in contrast to conventional patches, which may be transparent but are still visible.

As the gels dry to form the artificial skin, it pulls on and changes the shape of the real skin, and, with the proper application, could hide wrinkles or other properties associated with aging skin. In the paper, the authors demonstrated that the artificial skin was effective at removing bags and smoothing wrinkles under the eyes.

“Nobody dies of under-eye bags,” acknowledged Dr. Barbara Gilchrest, a dermatologist at Harvard Medical School and author of the paper, published in Nature Materials. But they do have social consequences for people. “It makes them look old. It makes them look tired. It makes them look sad. In our society, it’s considered very unattractive, and it’s a marker of aging.” 

It's the effect go blogging for ten years.

For medical use, Langer said that the artificial skin has many advantages over products currently on the market. You can change the properties of the film — for example, its thickness, breathability, or elasticity — depending on the desired effect. You can also spread it over as large or small an area as you want. Currently, people who wear medicinal patches — like NicoDerm— are limited by commercially available sizes.

For some conditions, like eczema and psoriasis, the area needing treatment may span much of the body, in which case an easily applied, drug-laden artificial skin could be a much better treatment option than a current approach, of slathering on a cream and wrapping the body in a kind of plastic wrap, Gilchrest said.

Samir Mitragotri, who studies drug delivery through the skin in his lab at the University of California, Santa Barbara, said he hadn’t before seen any material so transparent and so effective at changing the mechanical properties of the skin. Mitragotri, who was not involved in the study, called the approach “radical and revolutionary.”

The fake skin is in human trials, with a couple hundred individuals already tested. The company is working on developing the skin as a platform, after which they could decide to customize it by adding drugs.

Amir Nashat, acting chief executive officer of Olivo and managing partner at venture capital firm Polaris Partners, said the company is spending the majority of its time focusing on the medical application of the second skin. On a further horizon, the paper noted, those might include “durable ultraviolet protection” or using the skin to conceal disfiguring birthmarks.

But at present, the main thrust of the research they’ve published is cosmetic. It’s part of an over $60 billion cosmetics industry, which taps into an age-old desire for humans to retain their youthfulness....

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Time to shed these:

"Cambridge is central to Pfizer’s future" by Robert Weisman Globe Staff  April 13, 2016

CAMBRIDGE — Pfizer Inc.’s future is murky after its $160 billion merger with Allergan PLC fell apart, but one thing is clear: Its Cambridge research center will play a pivotal role in drug discovery, regardless of how the company moves forward.

The blockbuster deal was called off when the US Treasury Department issued new rules that would have prevented the combined companies from capitalizing on the lower corporate tax rate in Allergan’s home country, Ireland.

Related:

"An inversion is a sophisticated piece of financial engineering in which a US company buys a foreign firm, and then moves its headquarters to an overseas location where corporate taxes are lower. In the short run, some of the biggest winners are the investment bankers and lawyers who profit from working on these transactions."

Don't we all exist to serve their wealth, I mean, health?

Pfizer chief executive Ian Read said the New York-based company was reconsidering an earlier plan to unlock “shareholder value” by separating its established franchises, which sell approved drugs, from its “innovative” businesses that develop medicines.

While a decision isn’t expected till the end of the year, Cambridge has already emerged as Pfizer’s innovation capital.

Its center here, which tests experimental drugs and forges outside partnerships in four of Pfizer’s six research areas, formally opened in June 2014, when the company consolidated scientists dispersed at several area sites in a new building leased from MIT at 610 Main St.

An adjoining Pfizer research building, called 610 North, is scheduled to open early next year and house other Pfizer researchers as well as independent biotech startups in collaboration space modeled after the Lab Central incubator next door. Together, the two buildings will employ nearly 1,000 people in a 500,000-square-foot “unified research campus.”

“It will have a leading impact on our portfolio when it comes to innovation,” said Mikael Dolsten, president of Pfizer’s worldwide research and development. “We are very optimistic about what the Cambridge group will be doing. And Cambridge will be one-stop shopping for biotech companies and academic scientists who want to engage with us.”

Most of the world’s pharmaceutical heavyweights have similarly set up outposts in Cambridge to monitor the local research scene, strike scientific alliances, and fund and license promising therapies.

The site will be on display Thursday when Dolsten and other senior executives outline their vision and strategy at a Pfizer Pharma Day presentation before Massachusetts life sciences leaders. Among other things, they’ll discuss drug research programs within key therapeutic areas and Pfizer’s new approach, which combines in-house science with outside alliances.

“What we don’t want to be is the partner who just whips out the checkbook,” said Michael Ehlers, the senior vice president for biotherapeutics research who took over last May as site head for the Cambridge research center. “We are here to do discovery science and early clinical research as well as partnering and bringing in great assets from the outside.”

For Pfizer, the largest US pharmaceutical company, Cambridge has become the second-largest research site, after its sprawling campus in Groton, Conn., which it has gradually been shrinking.

Think they will move the whole shebang to Bo$ton?

Ehlers, who initially worked for Pfizer in Groton as chief scientific officer for neuroscience research, moved his group to Massachusetts in 2012. The neuroscience team was the first to set up shop in the new Cambridge research center, where it can more easily collaborate with dozens of academic research labs and biotech startups in the neighborhood.

The new research center features open architecture and a hipper culture more akin to Kendall Square’s entrepreneurial startups than the closed-door research at Pfizer’s traditional campuses. Pfizer hosts Cambridge forums to share ideas with its research neighbors, and it even built a lab with black walls dubbed the “pink flamingo lounge.”

In addition to neuroscience, Cambridge is ground zero for Pfizer’s research into rare diseases, inflammation and immunology, and cardiovascular and metabolic conditions.

Pfizer, with about 2,000 employees in Massachusetts, also does protein engineering and biotech research and manufacturing in Andover and operates a Center for Therapeutic Innovation in Boston’s Longwood Medical Area, where it works with university researchers. (Its cancer research is based in California, and its vaccines research in Pearl River, N.Y.)

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Now about Allergan:

Pfizer, Allergan pondering a tieup
Pfizer, Dublin-based Allergan in ‘friendly’ talks on record deal
Pfizer close to acquiring Allergan for $380 per share
Pfizer, Allergan to merge in $150 billion deal

Not $o fa$t!

"Pfizer-Allergan deal reportedly killed after new inversion rules" Globe Wire Services  April 05, 2016

Pfizer Inc. and and Allergan Plc will mutually end their planned $160 billion merger amid the US crackdown on corporate inversions, CNBC reported Tuesday night, without naming its sources.

Trump wants to put a 35% tariff (and tax) on them, which is why Wall Street hates him.

Allergan, which is run from New Jersey but has a legal domicile in Dublin, last year agreed to merge with Pfizer Inc. in a $160 billion deal that would give New York-based Pfizer a foreign address and a lower tax rate. Representatives for Pfizer and Allergan declined to comment.

The Treasury Department said Monday that new rules would limit companies’ ability to participate in inversion transactions if they’ve already done them within the past 36 months. Allergan has been involved in several such acquisitions in that time frame. In a corporate inversion, a US company merges with a smaller foreign firm and then transfers the new company’s tax address offshore.

Pfizer has been examining how it might be able to challenge new rules from the US Treasury Department, Bloomberg News reported earlier Wednesday, citing people with knowledge of the matter. Fighting the decision in court was one of the options under discussion, as well as restructuring the deal to reduce what Pfizer would pay, the people said.

Earlier in the day, investors seemed to view the deal as dead, and were trading shares in the two companies at a furious pace Tuesday.

Tax inversions and the need to overhaul the US tax structure have become a hot issue in the presidential campaign, with some candidates calling Pfizer and other companies considering such deals ‘‘unpatriotic.’’ President Obama held a news conference Tuesday afternoon, saying the Treasury rules are meant to prevent ‘‘one of the most insidious tax loopholes out there’’ and prevent wealthy corporations from shirking their tax responsibility.

In an inversion, a big company buys a smaller one in another country, usually with a lower tax rate, then moves the combined company’s address on paper — but little else — to that country. Allergan is the result of multiple inversions, and despite its Dublin address is operated from offices in Parsippany, N.J.

Shares also fell Tuesday for other companies that have been planning inversion deals: Milwaukee-based Johnson Controls Inc. and Ireland’s Tyco International, makers of heating and other building control systems that announced a $14.6 billion deal in January, and drugmakers Baxalta Inc. of Bannockburn, Ill., and Shire PLC of Ireland, which are planning a $32 billion inversion deal.

Related:

Shire still eyes Baxalta takeover, despite chilly response
Trial data on eye drug buoy stock of Shire PLC
Baxalta shares rise on report of sweetened Shire offer
Shire ramps up buying spree with $5.9 billion deal for Dyax
Amid takeover rumors, Baxalta opens new Kendall Square research center
Baxalta deal will boost Mass. operations, Shire CEO says
Baxalta to stay in Cambridge

The $32 billion deal is still in limbo.

As for Pfizer, experts disagree on what its Plan B will be and on its value and future prospects without the deal....

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Plan B:

After failed Allergan merger, Pfizer once again considers splitting up
Pfizer CEO looks for more deals as drug maker mulls split
Pfizer Blocks the Use of Its Drugs in Executions
Pfizer doubling patient income limit for free drug program 

Isn't that how they hook you?

Mass. whistleblower shares $98m payment in Pfizer settlement

Speaking of whi$tleblowing:

"Allergan unit to pay $125 million to settle alleged bribe scheme; Firm to pay after US claims it wooed doctors to use drugs; Mass. physician indicted" by Priyanka Dayal McCluskey Globe Staff  October 29, 2015

The drug reps bought the doctors lunches, dinners, drinks. They paid for speeches the doctors never made. And in exchange, the doctors prescribed drugs that boosted their sales.

Warner Chilcott, a unit of pharmaceutical giant Allergan PLC, will pay $125 million to settle these and other charges in an agreement announced Thursday by US Attorney Carmen M. Ortiz in Boston.

Ortiz said the company ran an elaborate scheme to prod doctors — including in Massachusetts — to prescribe its drugs in exchange for kickbacks....

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Also see:

"Allergan will buy back up to $10 billion in stock following a swing to a first-quarter profit on a strong surge in sales of key drugs, including the wrinkle and muscle spasm treatment Botox. The share buyback plan is contingent on the sale of the drug developer’s generics unit to Teva, which is expected to close by the end of the year. Meanwhile, the company is consolidating its executive team under current CEO Brent Saunders. The announcement came as the Dublin-based company swung to a first-quarter profit of $255.7 million, or 47 cents per share, after reporting a loss in the same period a year earlier."

Teva is an Israeli firm, and that can only help the payout. 

Time to put some cream on.

Xfund Fraud

Who gives a flying f....

"Ousted partner sues Xfund’s Chung, claiming fraud and defamation" by Katie Benner New York Times  May 17, 2016

SAN FRANCISCO — Xfund, a beleaguered venture capital firm that has put money into startups like genetics company 23andMe and real estate outfit Zumper, is breaking new and belligerent ground in the normally discreet world of technology investors.

If you are 23 you have to share it with law enforcement.

A complaint filed Friday in Santa Clara County Superior Court in California by Hugo Van Vuuren, one Xfund founder, against Patrick S. Chung, the other founder, and the fund itself, includes accusations of secret contract amendments, bullying, and schoolyard name-calling.

Chung called Van Vuuren a “spiteful moron” and “a trivial person pursuing trivial things” in e-mails, according to court documents. Chung also wrote that working with Van Vuuren was “like working with a retarded person” and that Van Vuuren would be worth more “dead than alive once we have key-man insurance.”

Van Vuuren alleges in his suit that Chung committed fraud by secretly amending their partnership agreement to take full control of Xfund’s investments and operations.

Van Vuuren also claims that Chung had a fiduciary duty to tell him about any changes to their agreement, but that when he was asked to sign the amended documents at the end of 2014, Chung mentioned only the fact that they had been altered to include a way to share proceeds from successful investments with new employees.

Last May, a lawyer for Xfund at Ropes & Gray e-mailed Van Vuuren to say that the agreements were drafted so that Xfund remained a “marriage of two equals,” but later that law firm told Van Vuuren to have an independent lawyer review the amendments that he had signed, the complaint states.

Xfund investors have tried to salvage the fund by approving a plan to support a scaled-back version that would be run solely by Chung, possibly with a third party monitoring his work, said an investor in the fund, speaking on the condition of anonymity.

But the intervention has not stopped the fight from heading to the courtroom. Van Vuuren has indicated that he has no plans to step aside, and he is pushing for a court trial, which could further embarrass Xfund and its investors.

A representative for Van Vuuren declined to comment beyond the lawsuit. An Xfund representative called the allegations bewildering and noted that Van Vuuren was a signed counterparty to all the fund formation documents.

Xfund began in 2011 as a small seed fund created to invest in startups out of Harvard University and the Boston area before it blossomed into an operation with an office and investments in Silicon Valley.

The cofounders have been fighting for nearly two years. As their relationship fell apart, Van Vuuren contends that Chung blocked his investment ideas and looked for ways to lessen his influence.

He says Chung offered David J. Malan, a professor at Harvard, a share of Xfund’s profits for help with Xfund matters, in an attempt to “obtain an East Coast-based resource to replace Van Vuuren,” according to the court documents.

The complaint accuses Chung of defamation for seeking a restraining order in March, saying the move was an attempt to keep Van Vuuren away from an Xfund-sponsored event, and from the committee that was deciding how best to advise investors on how to act given that the fund’s partners could no longer work together.

I was told we were all better off working alone.

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I Can't Bear This Blog

"Two orphaned bear cubs were rescued Monday morning after their mother was electrocuted by a high voltage wire in Gardner, officials said. Rescuers found the injured mother bear and her cubs in a tree on Betty Spring Road, Massachusetts Environmental Police said in a statement. The mother bear had come into contact with the wire adjacent to the tree after climbing up there with her two cubs, Gardner Fire Lieutenant Guy Sharron said. She later died from the shock. The cubs did not come into contact with the wire, Sharron said...."

This Blog Caught in a Bind

"Bind Therapeutics files for bankruptcy protection" by Robert Weisman Globe Staff  May 02, 2016

Financially pressed Bind Therapeutics Inc. said Monday it has filed for federal bankruptcy protection after the breakdown of talks to restructure its debt, a rare misstep for one of the many Cambridge biotechs spawned by Kendall Square giant Robert Langer.

Bind last month said it was slashing its workforce by 38 percent and seeking a partner to help develop its lead cancer drug. It will continue operating with 61 employees as it reorganizes under Chapter 11 of the US bankruptcy code, said chief executive Andrew Hirsch.

Hirsch, who took over as CEO last year, said Bind’s bankruptcy filing was precipitated by an April 26 notice from lender Hercules Capital, a Palo Alto, Calif., venture debt firm that demanded payment in full of the $13.2 million balance on its loan, along with $1.2 million in fees.

“I understand they think they have a legal right to do this,” Hirsch said in an interview. “I was a bit surprised that they did it . . . Complying with that notice would have effectively meant liquidating the company. We felt our only course of action was to file Chapter 11.”

An executive from Hercules didn’t return phone calls seeking comment.

Ten-year-old Bind is one of many biomedical companies started in part by Langer, a Massachusetts Institute of Technology institute professor. Langer and his cofounder, Harvard Medical School professor Omid Farokhzad, created a technology that enables the development of “programmable nanomedicines” designed with physical and chemical characteristics to precisely target cells or tissues to treat a range of diseases.

Bind went public in 2013 through an initial public offering that raised $76.1 million, and it raised another $20 million in a follow-on offering last year. While it forged collaborations on other development programs with drug makers Pfizer Inc. and AstraZeneca PLC, the Cambridge company had been seeking a partner to help fund its lead drug program, an experimental treatment for advanced non-small cell lung cancer.

The layoffs it began last month, which include shutting down an 11-person research operation in Russia, were intended to slow its cash “burn rate” while it searched for a partner and tried to restructure its loan with Hercules, according to Hirsch.

Bind had about $40 million in cash and short-term investments at the end of last year, but the cash was needed to sustain its drug discovery efforts into the fourth quarter as it looked for a partner. The accelerated payment demand from Hercules on its largest loan would have forced it to curtail those efforts, company executives said.

Hirsch, who joined Bind in 2012 as chief financial officer, said he was disappointed the company had to seek bankruptcy protection but said it plans to move forward....

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You can't get blood from a stone.

Apple Buffett For Breakfast

It's the mo$t important meal of the day....

"Berkshire’s Apple bet suggests faith in product pipeline" by Noah Buhayar, Jing Cao and Alex Webb Bloomberg News  May 16, 2016

OMAHA, Neb. — Given all the pessimism about Apple Inc. these days, one might wonder why Warren Buffett’s Berkshire Hathaway Inc. is betting $1.1 billion on the company. But if sentiment on Wall Street is any guide, the Oracle of Omaha and his lieutenants have made a prescient play.

Even after Apple warned that the sales decline it experienced in the fiscal second quarter would continue in the subsequent three months, there are just two analysts among the 50 monitored by Bloomberg who recommend selling the stock. While the average 12-month target price has fallen from last July’s peak, it remains at $124.60, about 33 percent above current levels.

The gamble hints at Berkshire’s confidence in Apple’s ability to create new products that reignite revenue growth. That may either come with the iPhone 7, set to be introduced later this year, or in product categories such as autonomous driving or virtual reality hardware.

“It’s kind of a no-brainer,” said Steve Wallman, a money manager in Middleton, Wisc., who has invested in Berkshire since 1982 and Apple since December 2003. “I don’t think it’s a great stretch for Berkshire. The company is cheap. It has a boatload of cash.”

Apple shares jumped 3.7 percent to $93.88 after Berkshire’s announcement, valuing Apple at about $514 billion. The company’s nearly 30 percent share slide since the middle of last year may have created an opportunity for Berkshire, even though Buffett typically avoids technology investments.

Berkshire held 9.81 million Apple shares as of March 31, according to a regulatory filing Monday from the billionaire’s Omaha-based company. The holding was valued at $1.07 billion at the end of the first quarter.

Apple trades at a multiple of 10.5 times its earnings per share. The shares have a dividend yield of 2.35 percent. That ranks Apple above the average of its peers on the the Standard & Poor’s Information Technology index.

“Apple at the current valuation makes a ton of sense; it’s a consumer-product company more than a tech company,” Jeff Matthews, an author of Berkshire-related books, said about the new holding. “The company has a great financial model, a great brand name and a cheap stock.”

Some investors have expressed concern that declining iPhone sales, which prompted Apple’s first quarterly drop in revenue in 13 years, are indicative of a broader slackening in demand for smartphones. Gartner Inc. predicts that smartphone sales growth will fall to the lowest level ever this year.

David Tepper’s Appaloosa Management disclosed Friday that it sold out of its Apple stake in the first quarter. Billionaire Carl Icahn said last month that he exited a position in the company because of concern about its relationship with China. Kristin Huguet, a spokeswoman for Apple, wasn’t immediately available to comment.

Chief executive Tim Cook is pivoting toward services and exploring new technologies such as self-driving cars to reduce reliance on the iPhone. Cyrus Mewawalla, managing director at London-based CM Research, said those initiatives are unlikely to pay off this year, but may reward more patient investors.

“What would make this stock a good buy is a whole load of projects we know they’re working on,” he said. “They’re working on a TV, a car, a whole bunch of apps coming for the Apple Watch. We know mobile payments has just started off.”

The investment was made by one of Buffett’s deputies, Todd Combs or Ted Weschler, Buffett wrote in an e-mail to the Wall Street Journal. Both have been building their own portfolios in recent years and typically take stakes of $1 billion or less per company, while Buffett makes larger wagers. The filing doesn’t specify the person behind each holding, and Berkshire didn’t immediately respond to a message seeking comment.

Berkshire has waded more into technology investments in recent years. Combs previously invested in Intel Corp. And Buffett is backing billionaire Dan Gilbert’s bid for Yahoo! Inc.’s core assets. The Berkshire chairman told CNBC that he could provide financing, if there were adequate protections, but doesn’t have enough understanding of the Yahoo assets to take an equity stake.

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Related:

Yahoo losses rise ahead of a possible sale
Yahoo may start seeking buyers this week
Potential Yahoo suitors include Verizon, Google
UK’s Daily Mail considers bid for Yahoo
Four activist investors to join Yahoo board
Yahoo to shutter seven digital magazines
Verizon leads $57M round in Jana to subsidize data in developing world
Verizon said to seek AOL chief’s input in bid for Yahoo
Yahoo’s employee-ranking system challenged in court

Thus they will cut the troublemakers from the rolls.

Applications for unemployment increase

Yeah, it's the Verizon strike that's doing it!

So how is the bet on Apple paying off these days?

Google parent grabs top market spot from Apple

I'm sure they will fall back into second soon.

Apple may be close to opening stores in India
Apple’s growth seen slowing as iPhone demand wanes

Same with this blog.

"After setting iPhone record, Apple forecasts rare sales drop" by Brandon Bailey Associated Press  January 27, 2016

SAN FRANCISCO — Apple is bracing for its first sales decline in 13 years, despite selling a record 74.8 million iPhones in the final three months of 2015.

The giant tech company says revenue could fall at least 8.6 percent during the January-March quarter, compared with a year earlier. Analysts say the latest iPhone models are selling reasonably well, but they’re not providing the boost Apple needs to match the massive sales growth it enjoyed last year.

The company inched past its previous record established in the holiday quarter of 2014, but Apple’s stock has been in a slump for months, as investors worry that the company won’t be able to duplicate last year’s growth in sales, which were in the double-digit percentages. In an interview, chief financial officer Luca Maestri said a strong dollar helped reduce revenue, as sales made with foreign currencies abroad convert into fewer dollars. He also said the company isn’t concerned about what he characterized as a short-term slowing of growth, because it has a large base of customers who can be relied on to buy new devices and pay for other services.

‘‘We think we’re in the strongest position we’ve ever been,’’ Maestri said, adding that the company estimates 1 billion Apple devices — including iPhones, iPads, Apple Watches, and Mac computers — are now in active use.

The iPhone, however, is Apple’s biggest-selling product, contributing nearly two-thirds of its revenue and a similar share of profit. Despite the introduction of new models, analysts say global demand for new smartphones isn’t growing as fast as it has in recent years. Apple is also confronting an economic downturn in China, one of its biggest markets.

The giant tech company is in no financial danger. It earned $18.4 billion in profit for the October-December quarter.

No one expects Apple to match those results in the current, January-March quarter, as sales traditionally drop after the holiday shopping season and the introduction of new models, but Apple is expected to release the next iPhone models, with new features, later this year. That could fuel another surge in sales. Along with first-time buyers and people who switch from competitors’ phones, analysts say Apple can count on a loyal base of iPhone owners who will buy a new model every two years or so.

Skeptics, however, note that Apple hasn’t come up with a blockbuster product to replace the iPhone. The company’s latest report showed sales of Mac computers and iPads both declined in the previous quarter.

--more--"

"Apple forecasts second sales drop as iPhone woes deepen" by Hayley Tsukayama Washington Post   April 27, 2016

Few expected the numbers to be this bad.

The slowdown has been a significant concern to analysts.

Overall, Apple reported $50.6 billion in revenue — short of the $52 billion expected by Wall Street — and $10.5 billion in profit. In the same quarter last year, the company reported $13.6 billion in profit on $58 billion in revenue.

What happened? One factor is that last year’s second quarter saw unusually high sales for Apple. Supply problems for the iPhone 6 and iPhone 6 Plus pushed back sales that normally would have been counted in the company’s traditionally strong holiday quarter.

But another, far more troubling reason is that Apple — along with the rest of the smartphone industry — is seeing a serious slowdown in the number of people buying new smartphones. For years, analysts have warned that the smartphone market is becoming saturated, meaning that most people who would want to buy smartphones already have done so.

Analysts do expect that iPhone sales will recover after the company introduces this year’s expected model of the device. The next version, if Apple keeps up with its traditional product cycle, should be the iPhone 7 and deliver a major hardware makeover.

Reports based on apparent weak links in Apple’s supply chain indicate that the new phone could have a new kind of headphone port, be dust-proof and waterproof and may even sport a totally redesigned home button.

Sales of all other prominent Apple products also dropped from the previous year. The iPad continued a prolonged slide, down 19 percent from the same period last year. Mac sales were also down 12 percent.

Apple’s services sales, which include the App Store, iTunes Store and iCloud, were a bright spot, with a 20 percent increase to $2.1 billion. So too was the ‘‘Other Products’’ category, comprising products such as Apple Watch, Apple TV, and iPod, which Apple does not break out individually. That area posted revenue of $6 billion — a 30 percent increase.

‘‘Our team executed extremely well in the face of strong macroeconomic headwinds,’’ said Tim Cook, Apple’s chief executive, in a news release. ‘‘We are very happy with the continued strong growth in revenue from services, thanks to the incredible strength of the Apple ecosystem and our growing base of over one billion active devices.’’

The second-quarter earnings report, however, demonstrates that it is critical for Apple to continue to deliver innovative products and find new ways to generate revenue as the smartphone becomes more of a commodity worldwide.

The company’s interests in media and entertainment, smart home devices, and health care — as well as persistent rumors of an Apple-designed car — all show Apple is hard at work to find and dominate the next technology revolution.

‘‘The industry is in a lull between the mobile boom and what comes next in automotive, the connected home, health and industrial applications of the Internet of things,’’ said Geoff Blaber, CCS Insight’s vice president for research in the Americas, in a note ahead of the report. ‘‘Pressure is likely to mount on Apple to reveal the next big source of growth.’’

Apple also announced it will expand its capital return program, adding up to $50 billion to the cash it has set aside to return capital to shareholders; that means Apple is planning to spend a total of $250 billion in cash this way by the end of March 2018....

--more--"

Maybe they need a little push.

Related(?):

Apple and the FBI

Taking a Second Look at San Bernardino

Three connected to San Bernardino shooter arrested

"Two teens kidnapped after their high school prom managed to escape after one of them wrested a gun away from their attacker and then pistol-whipped him, authorities said. Jared James was arrested Saturday when he went to a hospital for treatment of injuries he sustained in the fight with one of his victims, sheriff’s officials in San Bernardino County said. Investigators said the 22-year-old James, a Nevada resident, knew one of the teenagers, but didn’t specify what their relationship was. James is accused of forcing a 17-year-old boy and the teen’s girlfriend into their car at a parking lot in Victorville and driving them to an isolated area. During the struggle, the girl ran away to find help...."

Time for another Tyng, and did you see who they are blaming for the latest round of psyop phone calls

You can't Trump that! 

"An FBI spokeswoman said the agency is investigating many of the incidents around the country, but she declined to comment further. “We prefer not to discuss the specifics about how this type of crime is committed because it just encourages people,” said Kristen Setera, spokeswoman for the FBI in Boston. In February, Rhode Island State Police arrested a 16-year-old high school student from Newport, charging the teenager with making robocall bomb threats in eight communities, according to the Providence Journal."

 I guess they can.

Enough waffling:

"The Federal Bureau of Investigation paid for the tool it used to break into a dead terrorist’s iPhone and is considering whether to tell Apple Inc. how it was done, FBI Director James Comey (left) said. Comey disclosed during a speech Wednesday at Kenyon College in Ohio that the FBI paid for the tool to break into the phone, although he didn’t provide further details. The FBI hasn’t said who provided the hacking tool."

Who did they pay and how much (my suspicion was an Israeli firm, don't know how much).

"FBI employs hackers to retrieve cellphone data" by Ellen Nakashima The Washington Post   April 13, 2016

Oh, they employed hackers. Hmmm.

The FBI cracked a San Bernardino terrorist’s phone with the help of professional hackers who discovered and brought to the bureau at least one previously unknown software flaw, according to people familiar with the matter.

The new information was then used to create a piece of hardware that helped the FBI to crack the iPhone’s four-digit personal identification number without triggering a security feature that would have erased all the data, the individuals said.

The researchers, who typically keep a low profile, specialize in hunting for vulnerabilities in software and then in some cases selling them to the U.S. government. They were paid a one-time flat fee for the solution.

Like a contractor.

Cracking the four-digit PIN, which the FBI had estimated would take 26 minutes, was not the hard part for the bureau. The challenge from the beginning was disabling a feature on the phone that wipes data stored on the device after 10 incorrect tries at guessing the code. A second feature also steadily increases the time allowed between attempts.

The bureau in this case did not need the services of the Israeli firm Cellebrite, as some earlier reports had suggested, people familiar with the matter said.

Considering the source, that is a denial to cover those tracks!! Bloggers must have dug it out.

The U.S. government now has to weigh whether to disclose the flaws to Apple, a decision that probably will be made by a White House-led group.

The people who helped the U.S. government come from the sometimes shadowy world of hackers and security researchers who profit from finding flaws in companies’ software or systems.

That's a huge tell right there. Who benefits? It's the (Jewi$h) Mafia, U.S. government, and $oftware $ecurity $ervices who are the hackers, not some enemy du jour as pushed by the pre$$.

Btw, whenever you see shadow and murk in the pre$$ it means they are concealing something.

Some hackers, known as ‘‘white hats,’’ disclose the vulnerabilities to the firms responsible for the software or to the public so they can be fixed and are generally regarded as ethical. Others, called ‘‘black hats,’’ use the information to hack networks and steal people’s personal information.

At least one of the people who helped the FBI in the San Bernardino, California, case falls into a third category, often considered ethically murky: researchers who sell flaws to governments, companies that make surveillance tools or groups on the black market. 

I rest my case.

This last group, dubbed ‘‘gray hats,’’ can be controversial, because critics say they might be helping governments spy on their own citizens. Their tools, however, might also be used to track terrorists or hack an adversary spying on the United States. When selling exploits to governments or on the black market, these researchers do not disclose the flaws to the companies responsible for the software, as the exploits’ value depends on the software remaining vulnerable.

Of course, they are ALL UNDER ONE HAT!

In the case of the San Bernardino iPhone, the solution brought to the bureau has limited shelf life.

FBI Director James B. Comey has said that the solution works only on iPhone 5Cs running the iOS 9 operating system - what he calls a ‘‘narrow slice’’ of phones.

Hello? Hello? 

Print got cut off there.

Apple said last week that it would not sue the government to gain access to the San Bernardino solution.

Still, many security and privacy experts have been calling on the government to disclose the vulnerability data to Apple so that the firm can patch it.

If the government shares data on the flaws with Apple, ‘‘they’re going to fix it and then we’re back where we started from,’’ Comey said in a discussion at a privacy conference last week. Nonetheless, he said Monday in Miami, ‘‘we’re considering whether to make that disclosure or not.’’

The White House has established a process in which federal officials weigh whether to disclose any security vulnerabilities they find. It could be weeks before the FBI’s case is reviewed, officials said.

‘‘When we discover these vulnerabilities, there’s a very strong bias towards disclosure,’’ White House cybersecurity coordinator Michael Daniel said in an interview in October 2014, speaking generally and not about the Apple case. ‘‘That’s for a good reason. If you had to pick the economy and the government that is most dependent on a digital infrastructure, that would be the United States.’’

What he is saying is all the spying trapdoors embedded in US software that enable endless data collection are starting to destroy the industry. 

But, he added, ‘‘we do have an intelligence and national security mission that we have to carry out. That is a factor that we weigh in making our decisions.’’ 

I knew there had to be a but.

The decision-makers, which include senior officials from the Justice Department, FBI, National Security Agency, CIA, State Department and Department of Homeland Security, consider how widely used the software in question is. They also look at the utility of the flaw that has been discovered. Can it be used to track members of a terrorist group, to prevent a cyberattack, to identify a nuclear weapons proliferator? Is there another way to obtain the information? 

Whatever they release is always of no more use to them as they have moved on to the next level. If this was a one-off then they will disclose.

In the case of the phone used by the San Bernardino terrorist, ‘‘you could make the justification on both national security and on law enforcement grounds because of the potential use by terrorists and other national security concerns,’’ said a senior administration official, speaking on the condition of anonymity because of the matter’s sensitivity.

A decision also can be made to disclose the flaw - just not right away. An agency might say it needs the vulnerability for only a few months or that its utility will quickly diminish.

‘‘A decision to withhold a vulnerability is not a forever decision,’’ Daniel said in the earlier interview. ‘‘We require periodic reviews. So if the conditions change, if what was originally a true [undiscovered flaw] suddenly becomes identified, we can make the decision to disclose it at that point.”

--more--"

Also seeApple resisting US in Boston case

In Manhattan, too:

"Calling it an issue of victims’ rights, the Manhattan district attorney says it’s crucial that Congress pass legislation requiring tech companies to give law enforcement a way to access information on encrypted phones and other devices. Cyrus Vance Jr. (right) says that while federal law enforcement tends to focus on the national security implications of locked phones, the ramifications go far beyond that. Vance said his office currently has 230 locked phones involved in cases. But tech companies such as Apple and Google say that creating so-called ‘‘back doors’’ that could be used to break phones would undermine security for everyone. Vance spoke Monday just ahead of a hearing on encryption before a House Energy and Commerce subcommittee. Attorneys for Apple and law enforcement are expected to testify."

"FBI: Using third parties to break encryption not only answer" by Eric Tucker Associated Press  April 20, 2016

WASHINGTON — The FBI is facing an increasing struggle to access readable information and evidence from digital devices because of default encryption, a senior FBI official told members of Congress at a hearing on digital encryption Tuesday.

Why don't we just turn the whole damn country into frikkin' nudist colony? 

You gonna be happy then?

Amy Hess said officials encountered passwords in 30 percent of the phones the FBI seized during investigations in the last six months, and investigators have had ‘‘no capability’’ to access information in about 13 percent of the cases.

‘‘We have seen those numbers continue to increase, and clearly that presents us with a challenge,’’ said Hess, the executive assistant director of the FBI branch that oversees the development of surveillance technologies.

Really?

"A man accused of aiding a foiled plot to bomb a Kansas military post on behalf of the Islamic State pleaded guilty to conspiracy Monday. Alexander E. Blair admitted in a Topeka federal court that he lent $100 to a friend, John T. Booker, to pay for storage of a bomb that Booker planned to detonate last year outside the Fort Riley military post, about 60 miles west of Topeka. Prosecutors say Booker, 21, planned the attack with two contacts who were confidential FBI informants. Agents arrested Booker in 2015 when he was trying to arm the bomb, which was actually a fake. Booker pleaded guilty in February to one count each of attempting to use a weapon of mass destruction and attempting to destroy government property with an explosive. Prosecutors said Blair and Booker met at a mosque in Topeka and had similar views about waging jihad against the US military."

They also went through Newburgh, and the FBI sure is good at framing pathetic patsies.

Between that and the FBI phone calls to schools.... sigh.

In her testimony to a subcommittee of the House Energy and Commerce Committee, Hess defended the Justice Department’s use of a still-unidentified third party to break into the locked iPhone used by one of the two attackers in the San Bernardino, Calif., shootings. But she said the reliance on an outside entity represented just ‘‘one potential solution’’ and that there’s no ‘‘one-size-fits-all’’ approach for recovering evidence. She said she did not think that path should be the sole solution.

‘‘These solutions are very case-by-case specific,’’ she said. ‘‘They may not work in all instances. They’re very dependent upon the fragility of the systems, the vulnerabilities we might find,’’ she said, adding that cooperation between the government, academia, and private industry was needed to come up with more solutions.

Asked about the FBI’s reliance on a third party to get into the phone, and its inability to access the device on its own, Hess said the work requires ‘‘a lot of highly skilled specialized resources that we may not have immediately available to us.’’

Representatives from local law enforcement agencies echoed Hess’s concerns. Thomas Galati, chief of the intelligence bureau at the New York Police Department, said officials there have been unable to break open 67 Apple devices for use in 44 different investigations of violent crime — including 10 homicide cases.

Still, despite anxieties over ‘‘going dark,’’ a February report from the Berkman Center for Internet and Society at Harvard University said the situation was not as dire as law enforcement had described and that investigators were not ‘‘headed to a future in which our ability to effectively surveil criminals and bad actors is impossible.’’

Oh, we are all being jerked around again by this lying, looting government.

The hearing comes amid an ongoing dispute between law enforcement and Silicon Valley about how to balance consumer privacy against the need for police and federal agents to recover communications and eavesdrop on suspected terrorists and criminals. The Senate is considering a bill that would effectively prohibit unbreakable encryption and require companies to help the government access data on a computer or mobile device when a warrant is issued.

They already have that power so what are they really writing into law?

Bruce Sewell, Apple’s general counsel, touted the importance of encryption particularly in light of devastating breaches of sensitive government information — including at the IRS and the Office of Personnel Management.

Well, I wasn't going to mention the piss-poor job this government does at protecting your information as they encourage you to pay everything by mobile app and do all financial transactions on line.

‘‘The best way we, and the technology industry, know how to protect your information is through the use of strong encryption. Strong encryption is a good thing, a necessary thing. And the government agrees,’’ Sewell testified.

In response to questions raised at the hearing, Sewell said that the Chinese government had asked Apple for its source code within the last two years — and that Apple declined.

The long-simmering clash escalated in February after a judge in California directed Apple to help the FBI break into the phone used by Syed Farook, who along with his wife killed 14 people on Dec. 2 before dying in a shootout with police. The Justice Department last month said a third party had approached it with a way into the phone, effectively ending that court case. Another legal fight over a phone in a separate drug case is still pending in Brooklyn, N.Y.

That guy just testified.

--more--"

Related:

"The FBI’s hack into a terrorist’s iPhone didn’t come cheap. FBI Director James Comey (right) said the US paid more than he will make in salary over the rest of his term to secure a hacking tool to break into a mobile phone used by a dead terrorist in the San Bernardino, Calif., attack last year. The purchase ended one dispute with Apple Inc. over accessing mobile phones with increasingly sophisticated encryption software that is stymieing law enforcement officials across the United States. The law enforcement agency paid “more than I will make in the remainder of this job, which is 7 years and 4 months,” Comey said Thursday at the Aspen Security Forum in London. “It was, in my view, worth it.” Comey’s pay this year is $185,100, according to federal salary tables, indicating the tool cost the agency more than $1.3 million. FBI directors are appointed to 10-year terms."

Apples starting to go sour about now.

"FBI won’t reveal method for cracking San Bernardino iPhone" by Ellen Nakashima Washington Post  April 27, 2016

WASHINGTON — The FBI intends to tell the White House this week that its understanding of how a third party hacked the iPhone of a shooter in San Bernardino, Calif., is so limited that there’s no point in undertaking a government review of whether the tool should be shared with Apple, officials said.

I suppose shamelessness knows no bounds. Either that or our very security is in the hands of blind incompetents. That's all you got for the $1.3 million. 

No wonder they have to frame people; they wouldn't solve any crimes otherwise.

The decision, said officials familiar with the discussion who spoke on the condition of anonymity, ends several weeks of internal debate by bureau lawyers and technical experts about the FBI’s obligation to disclose the method.

Last month, the FBI paid more than $1 million for a tool to crack an iPhone used by one of the shooters in California. But the contract did not include rights to the software flaws that went into the tool, officials said.

As a result, the bureau has a limited technical understanding of how the method worked, officials said.

On Tuesday, FBI director James Comey acknowledged the internal debate.

‘‘The threshold is: Are we aware of the vulnerability, or did we just buy a tool and don’t have sufficient knowledge of the vulnerability that would implicate the process?’’ he said at a cyber conference at Georgetown University.

Comey was referring to a process, led by the White House, in which agencies such as the FBI, National Security Agency, and Homeland Security Department debate whether to disclose a computer software flaw discovered by the government to the software maker so the company can fix it.

Most flaws are disclosed, the White House has said. But some are kept secret so that the law enforcement or intelligence agency can use them in intelligence-gathering or criminal investigations. 

Meaning if it ain't theirs, they tell ya!

Some security experts said the bureau or the NSA could reverse-engineer the tool to gain information about the flaws. But the bureau was not likely to do so, several officials said.

Yeah, why waste time on a false flag fraud and fiction that they are behind it in the first place. The searing generational event has taken place, and San Bernardino means something else entirely now -- like 911.

‘‘If what we have bought is a tool and we’ve said that we won’t reverse-engineer the tool such that you can figure out what vulnerability is used to make the tool work, then even if we wanted to disclose something, there’s nothing we can disclose,’’ one senior administration official said. 

Stop chewing with your mouth full. Nothing but double-talk dropping out.

The FBI recovered the iPhone of Syed Rizwan Farook, one of the shooters in the December terrorist attack in San Bernardino, but could not access the data on it because it did not know the passcode. In February, the Justice Department obtained a court order to force Apple to write software that would disable several phone security features so the FBI could try to crack the code.

Apple challenged the order, arguing that the court had no basis to issue it and that it would set a dangerous precedent. In late March, the FBI disclosed that a third-party had come forward with a tool to help it gain access to the phone and so it no longer needed the court order to force Apple’s assistance.

Security and privacy advocates then began to push the bureau to disclose to Apple the flaws on which the tool was based so the tech giant could repair them.

Last month, professional hackers or vulnerabilities researchers brought flaws they had found to a company whose name the FBI has not disclosed.

Apple has said it will not press for the vulnerabilities to be disclosed.

‘‘We’re confident that the vulnerability the government alleges to have found will have a short shelf life,’’ a lawyer for Apple said this month. ‘‘In our normal process . . . we’ll continue to improve the phones and at some point this fix will get implemented.’’

--more--"

Maybe you should switch over to Microsoft:

"Microsoft sues to curb government’s secret e-mail searches" by Steve Lohr New York Times  April 15, 2016

NEW YORK — Microsoft, in a move that could broaden the debate over the balance between customer privacy and law enforcement needs, filed suit Thursday against the Justice Department in a bid to restrict authorities’ ability to view customers’ e-mails without their knowledge.

The suit, filed in Microsoft’s home turf in US District Court in Seattle, asserts that the government’s frequent use of a gag order statute in the Electronic Communications Privacy Act of 1986 is unconstitutional. That provision prevents Microsoft and other companies from telling people when the government obtains a warrant to read their computer files, including e-mails.

Specifically, the Justice Department’s use of that provision violates the Fourth Amendment right of its customers to know if the government searches or seizes their property, the suit contends, and it breaches the company’s First Amendment right to speak to its customers.

Microsoft’s suit, unlike Apple’s fight with the FBI over access to a locked iPhone, is not attached to a single case. Instead, it is intended to challenge the legal process regarding secrecy orders.

The company is also trying to fuel a public debate about the frequent use of secrecy orders in government investigations and, in the process, portray itself as an advocate of its customers’ privacy. The suit itself could plod through the courts, with appeals going on for months or even years.

Microsoft is drawing attention to legal issues that have become more acute as tech companies move their customers’ personal and business information into so-called cloud-computing systems. The largest such digital storehouses of personal e-mail and documents are operated by big tech companies like Microsoft, Google, and Apple.

Seizing information from file drawers or personal computers used to require entering a building to examine paper or a hard drive. Typically, the target of an investigation knew about it.

Not so in the cloud computing era, when investigators can bypass an individual and go straight to the company that hosts that information. And when courts issue secrecy orders, often with no time limit, a target may never know that information was taken.

It's safe to assume it was.

Microsoft, in its suit, contends that the government has “exploited the transition to cloud computing as a means of expanding its power to conduct secret investigations.”

So that is why they wanted to get you up there, and all those bloggers who warned all these years....

In an interview, Bradford L. Smith, Microsoft’s president and chief legal officer, said, “People should not lose their rights just because they are storing their information in the cloud.”

Microsoft, like Google and Apple, fields thousands of requests a year from federal and state prosecutors for customer information. The companies issue periodic reports with the totals.

But, Smith said, it was the rising portion of gag orders attached to the information warrants that led to the suit. From September 2014 to March 2016, Microsoft received 5,624 federal demands in the United States for customer information or data. Nearly half — 2,576 — were accompanied by secrecy orders.

Smith called the growing share of secrecy orders “fairly shocking,” suggesting they had become a routine process rather than an exception.

That isn't among the vast troves of data they dump on us?

The suit positions Microsoft as a champion of its customers’ privacy and draws attention to a legal process many may not be aware of.

“Most people do think of their e-mail as their personal property, wherever it happens to reside,” said A. Michael Froomkin, a law professor at the University of Miami. “But there is a disconnect between behavior and expectations and the statute. And Microsoft is inviting a court to bring the law in line with people’s expectations.”

Beyond image-burnishing, the suit is a pragmatic attempt to move away from litigating cases one by one, which is costly and time-consuming.

“Microsoft is going on offense, but they’re kind of forced into it,” Froomkin said.

Judges grant the secrecy orders. Microsoft sees only the warrant for the information demanded and not the argument made by the prosecutors to justify a gag order. But the Microsoft legal team looked at the high percentage of secrecy orders granted in the year-and-a-half through March of this year, and concluded that prosecutors often relied on a vague standard that there was a “reason to believe” that disclosure might hinder an investigation.

Microsoft, Smith said, “readily recognizes that nondisclosure orders are appropriate and necessary” when there is a risk of endangering a person’s life or that crucial evidence may be destroyed, for example.

“What concerns us is the low standard the government has to bear and the absence of a time limit,” Smith added.

About two-thirds of the secrecy orders Microsoft received in the span it audited had no time limits. In the physical world, so-called sneak-and-peek warrants for secret searches are granted to look at documents without notifying a target. But most secrecy orders delay notification for a fixed period of time, typically 30 to 90 days, and detailed evidence is required for any extensions. 

And they called it the Land of the Free! 

That looks like anything but!

Microsoft, Smith said, has talked to other major tech companies, and others may join with briefs in support of Microsoft.

In addition to challenging the Justice Department and the courts, Microsoft is trying to prod Congress into looking at the issue.

In both the House of Representatives and the Senate, legislation has been proposed to reform the Electronic Communications Privacy Act. But Smith said he saw little prospect of any substantive action in Congress anytime soon.

I hope not because they always seem to make things worse.

“We’ll keep taking these ideas to the Justice Department, Congress, and the courts,” Smith said.

--more--"

Related:

"IBM delivered a quarterly performance that shows the steady headway it is making in new businesses led by cloud computing and data-analysis software, like its Watson artificial intelligence technology. But the company’s transformation remains very much a work in progress. The erosion of some of its hardware and software products continues to be a drag on growth and profits, overshadowing the gains in the new fields. IBM on Monday reported a 21 percent decline in net profit from continuing operations, to $2.3 billion in the first quarter that ended March 31. Its operating earnings per share fell 19 percent, to $2.35 a share, though that was above the average estimate of Wall Street analysts of $2.09 a share, as complied by Thomson Reuters. The company’s first-quarter revenue declined 5 percent, to $18.7 billion. But that was ahead of analysts’ consensus forecast of $18.29 billion. IBM shares were down slightly in early after-hours trading."

Looks like you cut yourself there:

"90-Minute DNA testing kit receives FBI approval" by Katheleen Conti Globe Staff  April 07, 2016

NetBio, a Waltham company that created a system promising to provide a full DNA fingerprint profile in only 90 minutes, has received FBI approval, giving the system the go-ahead to be used in accredited DNA labs.

This is the FBI’s first approval of such a system. It is unclear to what extent FBI labs will use the NetBio technology. But by allowing crime laboratories to obtain a full DNA profile in less than two hours, the approval could mean a breakthrough in the field of forensic analysis, said Richard Selden, chief executive of NetBio.

The test kit, dubbed DNAscan, is about the size of a large microwave oven and can read a DNA sample taken via cheek swab. Once a profile is generated, it can be compared with profiles listed in national and state crime databases, helping to determine whether a person is connected to other crimes.

Selden said the technology could also help ease testing backlogs for rape kits, which can go untested for long periods of time.

Currently the technology is only allowed in labs, but a congressional bill has been introduced that would allow the system to be used in police stations, so law enforcement officials to get a full DNA profile of a person soon after they are arrested.

That's not convicted or anything, just arrested. 

All part of the giant database to support the total surveillance grid.

Each unit has a list price of $350,000, Selden said, and was tested in labs in Alabama, Florida, Michigan, Pennsylvania, and Dubai.

It costs how much?

The company has partnered with GE Healthcare Life Sciences to market the product.

It's part of their image makeover.

NetBio was founded at MIT’s Whitehead Institute for Biomedical Research in 2000.

--more--"

We began with a business icon, let's end with one:

"Why billionaire Carl Icahn just dumped every share he has in Apple" by Renae Merle and Hayley Tsukayama Washington Post  April 29, 2016

Apple has had a tough week after reporting that its quarterly revenue fell for the first time since 2003. Things got worse Thursday when billionaire investor Cal Icahn announced that he had sold his shares in the company.

The news sent Apple stock, already depressed by the disappointing earnings report earlier this week, down another 3 percent. Apple’s stock, one of the most widely held in the world, is now down about 10 percent this week, erasing about $60 billion from its market value.

Icahn has been one of Apple’s most prominent — and vocal — investors. In 2014, he suggested Apple was undervalued and was worth more than $1 trillion. Icahn has also repeatedly tussled with the firm about a program for buying back its stock, which could raise its value. The company eventually relented.

And that's a good thing?

But, Icahn said on CNBC Thursday afternoon, he has now sold all of his shares in the company and made a $2 billion profit.

‘‘We obviously made a great deal of money,’’ Icahn said.

Apple did not immediately respond to a request for comment.

Apple is a ‘‘great company,’’ Icahn said. Icahn said he called Tim Cook, Apple’s chief executive, to alert him to the news.

‘‘He seemed sort of sad to hear that,’’ Icahn said.

Apple, like every other smartphone vendor, has watched consumer appetites for smartphones shrink during the past several quarters. That slowing growth seems to have caught up with the company this quarter, particularly in the critical China market. Apple reported that revenue was down 26 percent from the same period last year, making it the region of the world where the firm saw the greatest downturn.

That appears to be behind Icahn’s decision to sell his shares in the company, which were once worth more than $5 billion. ‘‘China could be a shadow for [the company], and we have to look at that,’’ he told CNBC....

--more--"

You know what is the problem at the top?

"Efforts to diversify America’s corporate boards with more minorities and women are still lagging, with Hispanics, in particular, far behind other groups in being selected for directorships, according to an annual report on the board composition of large companies. The gap has widened over the last seven years, according to Heidrick & Struggles Board Monitor, which has tracked board appointments since 2009."

Looks like quotas to me, and I'm so sick of identity politics and all its divisions.

Few women are benefiting from surge in tech jobs

Well, they do have their say and there will always be a bias; think of it like being Navy and just hunker down and get out as quick as you can.

Fix the wage gap with transparency Brigid Schulte is author of “Overwhelmed: Work, Love & Play When No One Has the Time’’ and director of the Better Life Lab at New America. She was a staff writer at The Washington Post for nearly 17 years.

"Nift, a Cambridge startup that helps small businesses send customers to each other, has raised $3 million in seed funding. With rising rents, many small businesses are searching for new ways to advertise on a shoestring budget, said Carrissa Blackburn, executive director of Cambridge Local First, a nonprofit network of locally-owned and independent Cambridge businesses."

Just thought it would be Nift-y to post that. 

Now about that room for the night:

"Are Airbnb and others costing the government billions?" by David Kocieniewski Bloomberg News  May 24, 2016

The IRS has been so slow to adapt to the rapidly emerging peer-to-peer economy that billions of dollars in taxable income are probably going unreported every year, according to a study being delivered to Congress this week.

More than 2.5 million Americans earned income via on-demand platforms like Airbnb Inc., Etsy Inc., and Lyft Inc. in 2014, and the companies generated an estimated $15 billion in revenues. But the companies don’t withhold taxes on the income they pay to people who provide services or sell items via their platforms.

The companies are required to notify the IRS of that income — and send service providers a 1099-K form of their yearly earnings to file with their tax returns — only if they earn at least $20,000 and have 200 or more transactions in a year. The rule applies only to companies that get paid by credit card.

That was how I was planning to pay for the room.

Can't you wait two seconds?

A study by researchers at American University has found that more than two-thirds of those who earned income from the platform economy never received a statement of their earnings. The study, which surveyed 40,000 members of the National Association of the Self Employed, found that many people who earn income on the platforms are confused about when, whether, or how to report their earnings on their tax returns.

Because much of the income earned in the platform economy is never reported to the IRS by the companies, it’s likely adding to the $194 billion per year that the IRS estimates the Treasury loses each year due to misreported individual business income.

‘‘These issues should be addressed — not only because millions of American taxpayers are needlessly burdened trying to comply with an antiquated, outdated tax system — but also because inaction has very real implications on Treasury and IRS’s ability to fairly and efficiently collect taxes,’’ said the report, written by Caroline Bruckner, managing director of the Kogod Tax Policy Center at American University. Bruckner is scheduled to testify about the report Tuesday before the House Small Business Committee. 

By this time you realize what you have here is a bankrupt, money-grabbing government reaching for all it can while trillions are wasted on the war machine, proving up pharmaceuticals, and bolstering banks.

The study said that IRS officials were notified two years ago that the $20,000 per year threshold was likely to mean that much of the income earned on the platforms would go unreported.

Now if you want to bring loot here.... $igh.

At the time, the study said, the IRS promised to provide new guidance to help clarify matters and ensure that income was reported. But no new guidance has been released, and the study warns that with the number of platform economy workers expected to grow to 7 million by 2020, the potential loss in tax revenue is likely to be substantial.

Bruce Friedland, an IRS spokesman, said the agency expects to issue guidance on the matter in the near future.

The study suggested that the IRS release clearer guidelines for companies below the $20,000 threshold for filing 1099-Ks to ease confusion and encourage a uniform response by the platform-based companies. Etsy, Airbnb, and Lyft all inform service providers that they only report income if the $20,000 and 200 transaction threshold is reached, the study noted, but Uber sends every one of its drivers a 1099-K and reports their income to the IRS, regardless of income earned.

The study said the current system ill-serves the millions of people who earn income from the platforms, by exposing them to possible audit and penalties for misreporting their income.

Only government and big business are allowed to lie.

‘‘At best, these small business owners are shortchanged when filing their taxes,’’ the study said. ‘‘At worst, they fail to file altogether.’’

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You want me to send someone up to your room?

"A Dorchester man was ordered held on $75,000 bail Monday morning for allegedly pretending to be a woman on a dating app and robbing men he set up dates with, prosecutors said. Rakeem Austin, 30, used the names “Lizzy S” and “Candy B” in arranging the dates, Suffolk prosecutors said. He then robbed the men at gunpoint, ordering each one to the ground, they said. “He stole items including cash, wallets, cellphones, and jewelry,” prosecutors said. Prosecutors said Austin was wearing a GPS at the time of the robberies. He was out on bail in a case involving breaking and entering."

Time to check out:

"House to consider IRS commissioner’s impeachment" by David M. Herszenhorn New York Times   May 24, 2016

WASHINGTON — When the House Judiciary Committee convenes on Tuesday to consider the alleged misdeeds of the IRS commissioner, John Koskinen, it will contemplate an action that has not been taken in more than 140 years.

Tuesday’s hearing on accusations by House Republicans that Koskinen lied under oath to Congress and defied a congressional subpoena will be a remarkable moment, even for a Washington long fractured by partisanship.

Not since Secretary of War William W. Belknap in 1876 has the House impeached an administration official other than the president, said Michael J. Gerhardt, a professor at the University of North Carolina School of Law and an expert on the federal impeachment process.

And an official below the president’s Cabinet has never been impeached.

“This is unprecedented in many respects,” Gerhardt said.

Senator Orrin G. Hatch of Utah, the Republican chairman of the Finance Committee, has made clear that the Senate would not convict Koskinen, which would require a nearly impossible two-thirds vote.

But the effort in the House highlights the extent to which the IRS has become a symbol for House Republicans of everything they despise about the federal bureaucracy, and their outrage about what they view as a pattern of obstruction by the Obama administration.

On his way out we are finally getting impeachment talk -- against underlings?

Koskinen was not even in government when the IRS admitted to singling out the tax-exemption applications of Tea Party groups for scrutiny. Organizations on the IRS’ “lookout lists” went beyond conservative groups to include other groups like Palestinian rights activists and open-software developers, but the scrutiny of hundreds of Tea Party applicants infuriated congressional Republicans.

President Obama turned to Koskinen in 2013 to lead the IRS because of his reputation in the public and private sectors as a go-to manager of troubled enterprises. Koskinen, who was 74 at the time, agreed.

“He is one of the truly dedicated public servants who has been respected as a top government manager for years,” said G. William Hoagland, who was a longtime staff director of the Senate Budget Committee and fiscal policy adviser to Senate Republican leaders.

(puke)

But amid the mishandling of e-mail messages sought as evidence by House investigators, that fury turned on him.

Koskinen will not appear at the Tuesday hearing, the IRS said on Monday, because he has just returned from a multinational tax conference in China and has had little time to prepare given the committee’s recent invitation.

“He provided, I think, a whole series of false testimony,” said US Representative Jason Chaffetz, a Utah Republican and chairman of the House Oversight and Government Reform Committee, who is one of the leaders of the push for impeachment. “You can’t be under a duly issued subpoena and mislead Congress, and when you provide false testimony there has to be a consequence.”

Happens all the time. Nobody gets worked up about it.

“We’re left with no other remedy,” Chaffetz added. “The FBI is not going to take action.”

I suspect they won't on this, either.

Congressional Democrats and the White House have characterized the criticism as part of a broader effort by Republicans bent on destroying the IRS by slashing its budget and impeding its work.

“Instead of taking real action on critical issues that involve the security and well-being of Americans, House Republicans are busy engaging in political witch hunts,” said Representative Sander M. Levin of Michigan, the senior Democrat on the tax-writing Ways and Means Committee.

‘‘Shame! Shame!’’ 

See if he floats in the toilet.

The case against Koskinen focuses on testimony that he gave to Congress as part of inquiries into whether the IRS improperly scrutinized applications for tax-exempt status by conservative political groups. The IRS admitted the improper conduct and apologized, but the Justice Department ultimately said it had found mismanagement but no crime, and it did not bring any charges.

Koskinen started as commissioner of the IRS in December 2013, well after the scrutiny was exposed.

But House Republicans continued their investigations, and say the new commissioner lied during testimony in the winter and spring of 2014.

Koskinen was unavailable for comment last week, but in an interview in April he called the House impeachment resolution, which was introduced in the fall, “groundless.”

“We testified truthfully and completely on the basis of what we knew at the time,” he said. He attributed the loss of some of Lerner’s e-mails to “the inadvertent destruction of very old tapes.”

Those are the same excuses they put forth regarding Iraq, and who Lerner?

--more--"

Fell asleep with the book at my side.