Month / August 2011

by Shama-e Zaheer

And The Hackers Get Younger by the (Zero) Day

A 10-year-old girl, who goes by the pseudonym – “CyFi”, has found that games apps on smartphones or tablets running on iOS or Android mobile platforms can be hacked into by tinkering with the device’s clock settings, which exposes an exploitable security loophole, or a “zero-day flaw”.

The girl displayed her hacking skills at the first annual DefCon Kids hacker conference – a subset of DefCon Hackers Conference in Las Vegas, the self-identified “world’s longest running and largest underground hacking conference”. Her presentation was titled “Apps — A Traveler of Both Time and Space; And What I Learned About Zero-Days and Responsible Disclosure”.

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by Shama-e Zaheer

The Safety of Gold

Investors are moving away from economy-dependent assets like T-Bills, currencies and from firm-dependent securities like stocks and bonds to economic performance-independent commodities (unlike oil) as safe-haven instrument while markets, particularly equities, continue to tumble all around us. Specifically, there is a rush for gold.

The graph shows the sharp price rise of gold in August. However, the most telling sign is the volumes traded in recent times, compared to over the previous months. Noteworthy is the high RSI (Relative Strength Index), which is generally indicative of an overbought situation, although here supported by price increases and prices touching the upper Bollinger. In other words, technically speaking (if you subscribe to such views), “sell” is still not signaled, since the indicators are not divergent.

“Speculators Pile into Gold Futures, Options” from Kitco News

by Shama-e Zaheer

And the Slide Continues … (But That’s Ok)

Stock markets are tumbling all over the world. Along the lines of my prediction in a recent post, stock markets in the US, Europe, Latin America & Asia, along with commodities markets, experienced significant declines.

Wall Street suffered the biggest fall in two years, brought about by massive “sell-offs” by investors, triggered by “great fear” of a US recession, while European markets also fell significantly, driven by the sell-off contagion and worsening debt problems in Europe’s large economies, including Spain & Italy. Latin American and Asian markets were not far behind either, as the sell-off continued on a global spree.

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by Shama-e Zaheer

The “IE User Low IQ Study” Hoax and the “Creation” of News

You may have read about it and even posted it on social networks and media – “Users of Microsoft’s Internet Explorer Web Browser have a Lower-than-average IQ”. This has turned out to be a hoax.

A website called AptiQuant.com published a report on how a study has revealed that IE users have lower-than-average IQ. This, quite understandably, enraged numerous IE users, and hate mail & threats of litigation against AptiQuant followed.

Later, uncanny similarities between AptiQuant.com and CentralTest.co.uk sites were discovered, which led to the veracity of the study and the site itself being questioned. Eventually, the site admitted to the hoax, and apologized to CentralTest for using their website materials, including the same “Our Team” people with different, imaginary names!

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by Shama-e Zaheer

Thus Begins the Slide

Global markets are on a downward slide. Stock markets across the globe are either falling sharply (indices in New York, London, Paris & Frankfurt are falling sharply as of writing this piece), or have closed lower (indices in Japan & Hong Kong).

Meanwhile, Spanish and Italian long-term bonds are yielding their record highest – indicating a lack of faith in their sovereign debt by creditors. Also, gold prices have hit a record high, being considered the lone safe investment now.

Having woken up from the keen focus on the US debt limit issue, global markets are now focusing on the general health of the global economy. The poor health of the US economy (slow service sector growth and falling factory order statistics being indicative), the ‘unbailably’ large economies of Spain and Italy, unrest  & uncertainty in the Middle Eastern nations – are all compounding the concerns of investors and markets across the globe.

Meanwhile, credit rating agencies Moody’s and Fitch have maintained their AAA rating for the US, albeit with a negative outlook on the ratings. The harsher S&P has not yet released their ratings. On the other hand, Dagong Global Credit Rating Company, China’s leading credit rating agency, has downgraded the US to A from A+ (which was, itself, a downgrade in Nov 2010). With the “Big Three” raters coming into frequent criticisms recently, rating agencies from developing economies are now gaining a stronger voice.

Overall, all these developments are signs of tougher times to come.