God’s Dice Playing May Lead To The Ultimate Secure Internet

Jesus-Quantum-MechanicsEinstein was not a big fan of quantum theory. The idea of quantum theory and that a particle’s position is not known until it is observed bothered Einstein. Einstein said regarding quantum theory: “God does not play dice”. A founding father of quantum theory, Niel Bohr, replied, “Stop telling God what to do.”

Einstein discovered quantum entanglement, calling it “spooky action at a distance”. Einstein discovered that quantum entanglement comes from the equations of quantum mechanics. Einstein found that two particles could become entangled so that, no matter the distance separating the two particles, if one particle is changed then the other entangled particle changes as well. When Einstein first discovered quantum entanglement, he thought it would disprove and discredit quantum theory. Einstein was later proven wrong.

Quantum entangled particles that can stay connected even when separated by large distances could be applied to encrypt communications and improve security over the internet. In the 1990s, scientists succeeded in using entanglement to securely transmit a message from one person to another by creating a shared quantum key that decoded the message only for the sender and receiver; however, it only worked when sending a message between two parties.

Together with researchers from Peking University, Associate Professor Margaret Reid from Swinburne’s Centre for Quantum and Optical Science, published a paper this month showing that messages can be shared between more than two people.

This is a major scientific breakthrough and it may provide unprecedented speed and security for a future quantum internet. This could open up a whole new industry involved in building out a quantum internet. One day, we might be able to invest in a quantum communications company and get in on the ground floor like our parents were able to invest in telecommunications and long distance phone companies decades ago. This could revolutionize communications over vast distances, even in space. Could this be why we have not detected any radio waves coming from outer-space? Perhaps it’s not that no intelligent life is out there but instead an issue of communications protocol where communications over light-years distance in outer-space is simply unpractical for anything but quantum entangled based communications.

Paralaks posted the video below that explains more about the science behind quantum entanglement:

UNSWTV posted the video below that shows how scientists are moving closer to creating a quantum internet:

Sources and more information:
Einstein’s ‘Spooky’ Theory Could Bring Snowden’s Encrypted Internet Dream to Life
Albert Einstein’s “spooky” quantum mechanics theory about entangled particles that can stay connected even when separated by large distances could be applied to encrypt communications and improve security over the internet… Until now the real application of this has been for messages being shared between two people securely without interception, regardless of the spatial separation between them…

Manufacturing Not As Strong As Many Thought

Today’s Durable Goods Orders release made it clear: the manufacturing sector is not as strong as many thought. New orders are up just 0.2% from a year ago! In fact, the only reason that manufacturing did not show contraction was from defense and nondefense aircraft orders which rose 6.9% month over month.

The headline number is that Durable Goods Orders rose by 2.2% but that’s smoke and mirrors. The 2.2% increase is month to month and we know that January dropped -1.3% partly because of bad weather.

Orders for durable goods (refrigerators, cars, computers, industrial machinery, electrical machinery) show how busy factories will be in the months to come, as manufacturers work to fill those orders. If businesses put in new orders for equipment, it suggests they are experiencing growth in their business.

Check out this chart from our friends at Econoday:


That’s horrible folks! It begs the question: Where exactly is the economic recovery we have supposedly been in the last 5 years?

The bond market usually will rally when Durable Goods Orders are weak. Check out how bonds popped this morning on the Durable Goods Orders report:


Stock Market Drops on Janet Yellen Interest Rates Comment

The stock market sold off on Janet Yellen’s comments today on when the Federal Reserve will allow interest rates to rise. The stock market is cruel and Janet Yellen just got her first lesson in how a little slip of the tongue can cause panic on Wall Street. That’s ok. No new Federal Reserve chairman has ever avoided tongue slippage. It’s baptism by fire baby. Janet Yellen just learned to never make eye contact with a Bear.

Janet Yellen announced another $10 billion taper today which took the total stimulus down to $55 billion. Now think about that for a second. The Federal Reserve is actually speeding up its tapering. When QE was at $85 billion per month, a $10 billion cut amounted to a cut of 11.7%. Today, the cut amounted to $10 billion / $65 billion = 15.3%. In fact, Janet Yellen said the bond-buying program of the Federal Reserve will probably end this fall. She then went on to make her first mistake as Fed chairman by saying the Fed would allow interest rates to rise about 6 months later. This means that in about a year from now, interest rates will start rising. The market begins pricing in news by up to a year in advance and boy did it price in this new revelation about interest rate hikes today.


To understand why the market sold off, you need to know a little bit about sector rotation and the Bull/Bear cycle. Interest rates are what drives sector rotation and sector rotation is what drives the Bull/Bear market cycle.


Notice on our sector rotation wheel above, interest rates are at the very center of everything. As interest rates rise, we move clockwise around the wheel and start moving towards the next Bear market. Rising interest rates slow down consumption because borrowing costs go up. Therefore, by the Federal Reserve saying that interest rates will rise in the second quarter of 2015, they are in essence saying that the current Bull market is coming to an end.

Keep in mind that interest rates will probably have to rise for an extended period of time before they put us into the next Bear market. It’s not like suddenly, next spring, the economy is going to tank as interest rates being rising.

national-debtJanet Yellen’s statement suggests a slightly more hawkish shift by the Federal Reserve. Futures traders moved to price in a first interest rate hike as soon as April 2015. Previously, it was July.

The National Debt and Rising Interest Rates

There’s another reason why rising interest rates are bad: the national debt. The national debt is at $17.4 trillion. The price of servicing the national debt is about to jump if interest rates are allowed to rise. Total interest payments on the federal debt in 2013 were approximately $255 billion. Right now, the Treasury pays 0.01% on three-month T-bills and 2.98% on ten-year notes. If interest rates rise as most estimates expect (3-month Treasuries to approximately 4% by 2018 and 10-year Treasuries to approximately 5.2%) interest payments on the Federal debt will soar to $505 billion in 2018.

national-debtWhile Peter Schiff has made a lot of mistakes and is no where near to being one of the better traders on Wall Street, he agrees with me on the idea that rising interest rates are going to be a problem in terms of making the interest payments on the $17.4 trillion national debt. Peter Schiff says that the only way that we can pretend that we can afford what Congress spends each year is to keep interest rates low because we can’t pay the money back. It’s impossible for the U.S. to pay for what it has borrowed but we can pretend that we can afford the interest only if we keep interest rates near 0%. When interest rates finally do go up, that’s going to be when we have to admit that we are insolvent because we won’t be able to service the debt. Check out the recent interview Peter Schiff did on Russia Today TV (the video is set to start playing from the Peter Schiff interview, just click Play).

Surgical 3D Prints New Skull

Doctors can now 3D print new bones for your body. Stephen Power, a motorcycle accident victim in Wales, just had his skull surgically reconstructed by a team that used a 3D printer to print custom implants.

Mr. Power was in a horrible motorcycle accident that crushed his face. Even though he was wearing a helmet, his cheek bone, jaw, nose, and skull were all broken. Mr. Power has been wearing disguises to hide his disfigured face from the public.

Mr. Power recently had reconstruction surgery on his face. Maxillofacial surgeon Adrian Sugar, with the help of the Centre of Applied Reconstructive Technologies in Surgery and the National Centre for Product Design and Development Research, used 3D printing to print new skull bones for Mr. Power’s face. The undamaged side of Power’s head was scanned and used to produce a 3D model. Mr. Powers told the BBC that he could see the difference immediately after surgery and said, “It is totally life changing.” You can watch the BBC news video here.

Folks, 3D printing is changing life as we know it. Already we are starting to see a new line of products and services impacting multiple sectors.

PBSoffbook posted the excellent video below on 3D printing:

To say that 3D printing companies are volatile investments at the moment is an understatement. You have to balance your enthusiasm for the technology while limiting your downside risk.

Some popular 3D printing companies are: 3D Systems (DDD), ExOne (XONE) and Voxeljet (VJET).

Sofi AI Market Sentiment Gauge

Sofi AI Market Sentiment Gauge

Market is neither overbought or oversold.