bilateralThe Economist整理版(《经济学人》原版英文，有4000词汇即可，练习阅读绝好资料)

2021年1月21日发(作者：beset)
Digest Of The. Economist. 2006(2-3)

Moving markets

Shifts in trading patterns are making technology ever more important
AN INVESTOR presses a button, sending 1,000 small “buy” orders to a stock exchange. The
exchange's computer system
instantly kicks in, but a split second later, 99% of the orders are cancelled. Having found the best price, the investor makes his trade
discreetly, leaving no visible trace on the market
—
all in less time than it takes to blink. His stealth strategy remains intact.
Events like this happen many times a day, as floods of orders from active hedge funds and
“algorithmic” traders—
who use
automated programs to buy and sell
—
rush through the information- technology systems of the world's exchanges. The average
transaction size on leading stock exchanges has fallen from about 2,000 shares in the mid-1990s to fewer than 400 today, although
total trading volume has soared. But exchanges' systems have to cope with more than
just a growing onslaught of “buy” and “sell”
messages. Customers want to trade in more complicated ways, combining different types of assets on different exchanges at once.
Then, as always, there is regulation. All this is pushing technology further to the fore.
Recent embarrassments at the Tokyo Stock Exchange have illustrated what can happen when systems fail to keep up with the
times. In just the past few months, the importance of technology has been plain in mergers (those of the New York Stock Exchange
and Archipelago, and NASDAQ and INET); collaborations (the decision by the New York Board of Trade to use the Chicago
Board of Trade's trading platform); and the creation of off-exchange trading networks (including one unveiled recently by
Citigroup).
Technology is hardly a new element in financial markets: the advent of electronic trading in the 1980s (first in Europe, later in
America) helped to globalise financial markets and drove up trading volumes. But having slowed after the dotcom bubble it is now
demanding ever more of exchanges' and intermediaries' attention. Investors can now deal more easily with exchanges or each other,
bypassing traditional routes. As customers' demands and bargaining power have increased, so the exchanges have had to ramp up
their own systems. “Technology created the monster that has to
be ad
dressed by more technology,” says Leslie Sutphen of Calyon
Financial, a big futures broker.
Aite Group, a research firm, reckons that in America alone the securities and investment industry spent $$26.4 billion last year
on IT (see chart), and may spend $$30 billion in 2008. Sell-side firms spend most: J.P. Morgan Chase and Morgan Stanley each
splashed out more than $$2 billion in 2004, while asset-management firms such as State Street Global Advisors, Barclays Global
Investors and Fidelity Investments spent between $$250m and $$350m apiece. With brokerage fees for trades whittled down, many
have concluded that better technology is one way to cut trading costs and keep customers.

Testing all engines
Global growth is looking less lopsided than for many years
LARR
Y SUMMERS, a Treasury secretary under Bill Clinton, once said that “the world economy is

flying on one engine” to
describe its excessive reliance on American demand. Now growth seems to be becoming more even at last: Europe and Japan are
revving up, as are most emerging economies. As a result, if (or when) the American engine stalls, the global aeroplane will not
necessarily crash.
For the time being, America's monetary policymakers think that their economy is still running pretty well. This week, as Alan
Greenspan handed over the chairmanship of the Federal Reserve to Ben Bernanke, the Fed marked the end of Mr Greenspan's
18-year reign by raising interest rates for the 14th consecutive meeting, to 4.5%. The central bankers also gave Mr Bernanke more
flexibi
lity by softening their policy statement: they said that further tightening “may be needed”

rather than “is likely to be needed”,
as before.
Most analysts expect the Fed to raise rates once or twice more, although the economy slowed sharply in late 2005. Real GDP
growth fell to an annual rate of only 1.1% in the fourth quarter, the lowest for three years. Economists were quick to ascribe this
disappointing number to special factors, such as Hurricane Katrina and a steep fall in car sales
—
the consequence of generous
incentives that had encouraged buyers to bring purchases forward to the third quarter. The consensus has it that growth will bounce
back to an annual rate of over 4% in the first quarter and stay strong thereafter.
This sounds too optimistic. A rebound is indeed likely in this quarter, but the rest of the year could prove disappointing, as a
weakening housing market starts to weigh on consumer spending. In December sales of existing homes fell markedly and the stock
of unsold homes surged. Economists at Goldman Sachs calculate that, after adjusting for seasonal patterns, the median home price
has fallen by almost 4% since October. Experience from Britain and Australia shows that even a soft landing for house prices can
cause an acute slowdown in consumer spending.
American consumers have been the main engine not just of their own economy but of the whole world's. If that engine fails,
will the global economy nose-dive? A few years ago, the answer would probably have been yes. But the global economy may now
be less vulnerable. At the World Economic Forum in Davos last week, Jim O'Neill, the chief economist at Goldman Sachs, argued
convincingly that a slowdown in America need not lead to a significant global loss of power.
Start with Japan, where industrial output jumped by an annual rate of 11% in the fourth quarter. Goldman Sachs has raised its
GDP growth forecast for that quarter (the official number is due on February 17th) to an annualized 4.2%. That would push
year-on-year growth to 3.9%, well ahead of America's 3.1%. The bank predicts average GDP growth in Japan this year of 2.7%. It
thinks strong demand within Asia will partly offset an American slowdown.
Japan's labour market is also strengthening. In December the ratio of vacancies to job applicants rose to its highest since 1992
(see chart 1). It is easier to find a job now than at any time since the bubble burst in the early 1990s. Stronger hiring by firms is also
pushing up wages after years of decline. Workers are enjoying the biggest rise in bonuses for over a d
ecade.

Pass the parcel

Online shoppers give parcels firms a new lease of life
THINGS must be going well in the parcels business. At $$2.5m for a 30-second TV commercial during last weekend's Super
Bowl, an ad from FedEx was the one many Americans found the most entertaining. It showed a caveman trying to use a pterodactyl
for an express delivery, only to watch it be gobbled up on take-off by a tyrannosaur. What did the world do before FedEx, the ad
inquired? It might have asked what on earth FedEx did before the arrival of online retailers, which would themselves be sunk
without today's fast and efficient delivery firms.
Consumers and companies continue to flock in droves to the internet to buy and sell things. FedEx reported its busiest period
ever last December, when it handled almost 9m packages in a single day. Online retailers also set new records in America.
Excluding travel, some $$82 billion was spent last year buying things over the internet, 24% more than in 2004, according to
comScore Networks, which tracks consumer behaviour. Online sales of clothing, computer software, toys, and home and garden
products were all up by more than 30%. And most of this stuff was either posted or delivered by parcel companies.
The boom is global, especially now that more companies are outsourcing production. It is becoming increasingly common for
products to be delivered direct from factory to consumer. In one evening just before Christmas, a record 225,000 international
express packages were handled by UPS at a giant new air-cargo hub, opened by the American logistics firm at Cologne airport in
Germany. “The internet has had a profound effect on our business,” says David Abney, UPS's
international president. UPS now
handles more than 14m packages worldwide every day.
It is striking that postal firms
—
once seen as obsolete because of the emergence of the internet
—
are now finding salvation
from it. People are paying more bills online and sending more e-mails instead of letters, but most post offices are making up for that
thanks to e-commerce. After four years of profits, the United States Postal Service has cleared its $$11 billion of debt.
Firms such as Amazon and eBay have even helped make Britain's Royal Mail profitable. It needs to be: on January 1st, the
Royal Mail lost its 350-year-old monopoly on carrying letters. It will face growing competition from rivals, such as Germany's
Deutsche Post, which has expanded vigorously after partial privatisation and now owns DHL, another big international delivery
company.
Both post offices and express-delivery firms have developed a range of services to help ecommerce and eBay's traders
—
who
listed a colossal 1.9 billion items for sale last year. Among the most popular services are tracking numbers, which allow people to
follow the progress of their deliveries on the internet.

A question of standards

More suggestions of bad behaviour by tobacco companies. Maybe
ANOTHER round has just been fought in the battle between tobacco companies and those who regard them as spawn of the
devil. In a paper just published in the
Lancet
, with the provocative
title “Secret science: tobacco industry research on smoking
behaviour and cigarette toxicity”,
David Hammond, of Waterloo University in Canada and Neil Collishaw and Cynthia Callard, two
members of Physicians for a Smoke-Free Canada, a lobby group, criticise the behaviour of British American Tobacco (BAT). They
say the firm considered manipulating some of its products in order to make them low-tar in the eyes of officialdom while they
actually delivered high tar and nicotine levels to smokers.
It was and is no secret, as BAT points out, that people smoke low-tar cigarettes differently from high-tar ones. The reason is
that they want a decent dose of the nicotine which tobacco smoke contains. They therefore pull a larger volume of air through the
cigarette when they draw on a low-tar rather than a high-tar variety. The extra volume makes up for the lower concentration of the
drug.
But a burning cigarette is a complex thing, and that extra volume has some unexpected consequences. In particular, a bigger
draw is generally a faster draw. That pulls a higher proportion of the air inhaled through the burning tobacco, rather than through
the paper sides of the cigarette. This, in turn, means more smoke per unit volume, and thus more tar and nicotine. The nature of the
nicotine may change, too, with more of it being in a form that is easy for the body to absorb.
According to Dr Hammond and his colleagues, a series of studies conducted by BAT's researchers between 1972 and 1994
quantified much of this. The standardised way of analysing cigarette smoke, as laid down by the International Organisation for
Standardisation (ISO), which regulates everything from computer code to greenhouse gases, uses a machine to make 35-millilitre
puffs, drawn for two seconds once a minute. The firm's researchers, by contrast, found that real smokers draw 50-70ml per puff,
and do so twice a minute. Dr Hammonds's conclusion is drawn from the huge body of documents disgorged by the tobacco industry
as part of various legal settlements that have taken place in the past few years, mainly as a result of disputes with the authorities in
the United States.
Dr Hammond suggests, however, the firm went beyond merely investigating how people smoked. A series of internal
documents from the late 1970s and early 1980s shows that BAT at least thought about applying this knowledge to cigarette design.
A research report from 1979 puts it
thus: “There are three major design featur
es which can be used either individually or in
combination to manipulate delivery levels; filtration, paper permeability, and filter-
tip ventilation.”
A conference paper from 1983
says, “The challenge would be to reduce the mainstream nicotine
determined by standard smoking-machine measurement while
increasing the amount that would
actually be absorbed by the smoker”. Another conference paper, from 1984, says: “We should

strive to achieve this effect without appearing to have a cigarette that cheats the league table. Ideally it should appear to be no
different from a normal cigarette...It should also be capable of
delivering up to 100% more than its machine delivery.”


Thanks to the banks

College students learn more about market rates
A GOOD education may be priceless, but in America it is far from cheap
—
and it is not getting any cheaper. On February 1st
Congress narrowly passed the Deficit Reduction Act, which aims to slim America's bulging budget deficit by, among other things,
lopping $$12.7 billion off the federal student-loan programme. Interest rates on student loans will rise while subsidies fall.
Family incomes, grant aid and federal loans have all failed to keep pace with the growth in the cost of tuition.
“The funding
gap between what students can afford and
what higher education costs has got wider and wider,”
says Claire Mezzanotte of Fitch, a
ratings agency.
Lenders are rushing to bridge the gap with “private”
student loans
—
loans that are free of government subsidies and
guarantees.
Virtually non- existent ten years ago, private student loans in the 2004-05 school year amounted to $$13.8 billion
—
a compound
annual growth rate of almost 30%
—
and they are expected to double in the next three years. According to the College Board, an
association of schools and colleges, private student loans now make up nearly 22% of the volume of federal student loans, up from
a mere 5% in 1994-95.
The growth shows little sign of slowing. Education costs continue to climb while pressure on Congress to pare down the
budget deficit means federal aid will, at best, stay at current levels. Meanwhile, the number of students attending colleges and trade
schools is expected to soar as the children of post-war baby-boomers continue matriculating.
Private student loans are popular with lenders because they are profitable. Lenders charge market rates for the loans (the rates
on federal student loans are capped) before adding up-front fees, which can themselves be around 6-7% of the loan. Sallie Mae, a
student-loan company and by far the biggest dispenser of private student loans, disclosed in its most recent report that the average
spread on its private student lending was 4.75%, more than three times the 1.31% it made on its federally backed loans.
All of this is good news when lenders are hungry for new areas of growth in the face of a cooling mortgage market. Private student
loans, says Matthew Snowling of Friedman, Billings, Ramsey, an
investment bank, are probably “the fastest
-growing segment of
consumer finance
—
and by far the most profitable one
—at a time when finding asset growth is challenging.” Last December J.P.

Morgan, which already had a sizeable education-finance unit, snapped up Collegiate Funding Services, a Virginia-based provider of
federal and private student loans. Companies from Bank of America to GMAC, the financing arm of General Motors, have jumped
in. Other consumer-finance companies, such as Capital One, are whispered to be eyeing the market.

In the beginning...

How life on Earth got going is still mysterious, but not for want of ideas
NEVER make forecasts, especially about the future. Samuel Goldwyn's wise advice is well illustrated by a pair of scientific
papers published in 1953. Both were thought by their authors to be milestones on the path to the secret of life, but only one has so
far amounted to much, and it was not the one that caught the public imagination at the time.
James Watson and Francis Crick, who wrote “A structure for deoxyribose nucleic acid”, have
become as famous as rock stars
for asking how life works and thereby starting a line of inquiry that led to the Human Genome Project. Stanley Miller, by contrast,
though lauded by his peers,
languishes in obscurity as far as the wider world is concerned. Yet when it appeared, “Production
of
amino acids
under possible primitive Earth conditions” was expected to begin a scientific
process that would solve a problem in
some ways more profound than how life works at the moment
—
namely how it got going in the first place on the surface of a sterile
rock 150m km from a small, unregarded yellow star.
Dr Miller was the first to address this question experimentally. Inspired by one of Charles Darwin's ideas, that the ingredients
of life might have formed by chemical reactions in a “warm, little

pond”, he mixed the
gases then thought to have formed the
atmosphere of the primitive Earth
—
methane, ammonia and hydrogen
—
in a flask half-full of boiling water, and passed electric
sparks, mimicking lightning, through them for several days to see what would happen. What happened, as the name of the paper
suggests, was amino acids, the building blocks of proteins. The origin of life then seemed within grasp. But it has eluded
researchers ever since. They are still looking, though, and this week several of them met at the Royal Society, in London, to review
progress.

The origin question is really three sub-questions. One is, where did the raw materials for life come from? That is what Dr
Miller was asking. The second is, how did those raw materials spontaneously assemble themselves into the first object to which the
term “alive” might reasonably be applied?
The third is, how, having once come into existence, did it survive conditions in the early
solar system?
The first question was addressed by Patrick Thaddeus, of the Harvard- Smithsonian Centre for Astrophysics, and Max
Bernstein, who works at the Ames laboratory, in California, part of America's space agency, NASA. As Dr Bernstein succinctly put
it, the chemical raw materials for life, in the form of simple compounds that could then be assembled into more complex
biomolecules, could come from above, below or beyond.

Full to bursting

Rising levels of carbon dioxide will dump even more water into the oceans
THE lungs of the planet, namely green-leafed plants that breathe in carbon dioxide and breathe out oxygen, also put water
vapour into the atmosphere. Just as people lose water through breathing (think of the misted mirror used to check for vital signs), so,
too, do plants. The question is, what effect will rising concentrations of carbon dioxide have on this? The answer, published in this
week's
Nature
by Nicola Gedney of Britain's Meteorological Office and her colleagues, would appear to be, less water in the
atmosphere and more in the oceans.
Measurements of the volume of water that rivers return to the oceans show that, around the world, rivers have become fuller
over the past century. In theory, there are many reasons why this could be so, but some have already been discounted. Research has
established, for example, that it is not, overall, raining
—
or snowing, hailing or sleeting
—
any more than it used to. But there are
other possibilities. One concerns changes in land use, such as deforestation and urbanisation. The soil in rural areas soaks up the
rain and trees breathe it back into the atmosphere, whereas the concrete in urban areas transfers rainwater into drains and hence into
rivers. Another
possibility is “solar dimming”, in which aerosol particles create a hazy atmosphere that holds less
water. And then
there is the direct effect of carbon dioxide on plant transpiration.
Dr Gedney used a statistical technique called “optimal fingerprinting” or “detection and attribution”
to identify which of these
four factors matter. Her team carried out five simulations of river flow in the 20th century. In the first of these they allowed all four
explanations to vary: rainfall, haze, atmospheric carbon dioxide and land use. They then held one of them constant in each of the
next four simulations. By comparing the outcome of each of these with the first simulation, the team gained a sense of its part in the
overall picture. So, for example, they inferred the role of land use by deducting the simulation in which it was fixed from the
simulation in which it varied.
As with any statistical analysis, the results are only as good as the model, the experimental design and the data. Dr Gedney and
her colleagues acknowledge that their model does not fully take into account the use of water to irrigate crops
—
particularly
important in Asia and Europe
—
nor the question of urban growth. They argue, however, that these aspects, taken together, would
remove water from rivers, which makes their conclusion all the more striking. And it is this: fuller rivers cannot be explained by
more rainfall or haze or changes in land use, but they can be explained by higher concentrations of atmospheric carbon dioxide.
The mechanism is straightforward. A plant breathes through small holes, called stomata, found in its leaves. Plants take in
carbon dioxide, and when the atmosphere is relatively rich in this gas, less effort is needed. The stomata stay closed for longer, and
less water is lost to the atmosphere. This means that the plant doesn't need to draw as much moisture from the soil. The unused
water flows into rivers.

The great tech buy-out boom

Will the enthusiasm of private-equity firms for investing in technology and telecoms end in tears, again?
PRIME COMPUTERS, Rhythm NetConnections and XO Communications
—
all names to drain the blood from the face of a
private-equity investor. Or so it was until recently, when investing in technology and telecoms suddenly became all the rage for
private-equity companies. These investment firms
—labelled “locusts” by unfriendly
Europeans
—
generally make their money by
buying big controlling stakes in companies, improving their efficiency, and then selling them on.
In the late 1980s, Prime Computers became private equity's first great “tech wreck”, humiliating investors who
thought they
understood the technology business and could nurture the firm back to health away from the shorttermist pressures of the public
stockmarket. After Prime failed, private- equity firms spent the best part of a decade focusing solely on the old economy. Only in
the late 1990s, when the new economy was all the rage, did they pluck up the courage to return to tech and telecoms
—
a decision
some of the grandest names in the industry were soon to regret. Hicks, Muse, Furst and Tate (Rhythm NetConnections) and
Forstmann Little (XO) have both been shadows of their old selves since losing fortunes on telecoms.
Now, investing in technology and telecoms is once again one of the hottest areas in the super-heated privateequity market. The
multi-billion-dollar question is: will this round of investment end any less horribly than the previous two?
Last month TDC, a Danish phone company, was finally acquired after a bid of $$15.3 billion by a consortium including
European giants Permira Advisors and Apax Partners, and American veterans Kohlberg Kravis Roberts (KKR), Blackstone Group
and Providence Equity Partners. In the past five years, there has been private-equity involvement in about 40% of telecoms deals in
Europe.
On the other side of the Atlantic, the action has focused mainly on technology, rather than telecoms. Last summer, a
consortium including Silver Lake Partners and KKR completed the biggest private-equity tech deal to date, buying SunGard Data
Systems, a financial-technology firm, for $$11.3 billion. Since then the deals have continued to flow. The $$1.2 billion acquisition of
Serena Software by Silver Lake is due to be completed by the end of March. Blackstone and others are said to be circling two IT
outsourcing firms
—
Computer Sciences and ACS.
There are reasons to hope that this time will be different. In telecoms, for instance, private-equity firms are mostly trying to
buy established firms
—
often former national monopolists
—
that, while they might be threatened by internet telephony, have strong
cash flow, physical assets and plenty of scope to improve the quality of management. These are the sorts of characteristics
private-equity investors thrive on. By contrast, the disastrous investments in the late 1990s were in new telecoms firms that were
building their operations.
In technology, private-equity interest has grown as the industry has matured, and cash-flow and profitability have become
more predictable. Until recently, it has been the norm for tech firms to plough back all their profit and cashflow into investing in the
business. They have carried no debt and paid no dividends. Now private-equity firms see the opportunity to pursue their classic
strategy of buying firms by borrowing against cashflow, and then returning money to shareholders. Glenn Hutchins of Silver Lake
thinks the tech sector is now in a similar condition to the old economy in America in the early 1980s, which is when private equity
first started to have an impact, by restructuring and consolidating many industries.


How to live for ever

The latest from the wacky world of anti-senescence therapy
DEATH is a fact of life
—
at least it has been so far. Humans grow old. From early adulthood, performance starts to wane.
Muscles become progressively weaker, cognition fails. But the point at which age turns to ill health and, ultimately, death is
shifting
—
that is, people are remaining healthier for longer. And that raises the question of how death might be postponed, and
whether it might be postponed indefinitely.
Humans are certainly living longer. An American child born in 1970 could expect to live 70.8 years. By 2000, that had
increased to 77 years. Moreover, an adult still alive at the age of 75 in 2002 could expect a further 11.5 years of life.
Much of this change has been the result of improved nutrition and better medicine. But to experience a healthy old age also
involves maintaining physical and mental function. Age-related non- pathological changes in the brain, muscles, joints, immune
system, lungs and heart must be minimised. These changes are called “senescence”.

Research shows that exercise can help to maintain physical function late in life and that exercising one's brain can limit the
progression of senescence. Other work
—
on the effects of caloric restriction, consuming red wine and altering genes in yeast, mice
and nematodes
—
has shown promise in slowing senescence.
The approach advocated by Aubrey de Grey of the University of Cambridge, in England, and presented at last week's meeting
of the American Association for the Advancement of Science, is rather more radical. As an engineer, he favours intervening
directly to repair the changes in the body that are caused by ageing. This is an
approach he dubs “strategies for engineered
negligible senescence”. In other words, if ageing humans can be
patched up for 30 years, he argues, science will have developed
sufficiently to make further repairs more effective, postponing death indefinitely.
Dr de Grey's ideas, which are informed by literature surveys rather than experimental work, have been greeted with scorn by
those working at developing such repair kits. Steven Austad, a gerontologist based at the University of Texas, warns that such
therapies are many years away and may never arrive at all. There are also the side effects to consider. While mice kept on
low-calorie diets live longer than their fatter friends, the skinny mice are less fertile and are sometimes sterile. Humans wishing
both to prolong their lives and to procreate might thus wish to wait until their child-bearing years were behind them before
embarking on such a diet, although, by then, relatively more age-related damage will have accumulated.
No one knows exactly why a low- calorie diet extends the life of mice, but some researchers think it is linked to the rate at
which cells divide. There is a maximum number of times that a human cell can divide (roughly 50) before it dies. This is because
the ends of chromosomes, structures called telomeres, shorten each time the cell divides. Eventually, there is not enough left for any
further division.
Cell biologists led by Judith Campisi at the Lawrence Berkeley National Laboratory in California doubt that every cell has this
dividing limit, and believe that it could be only those cells that have stopped dividing that cause ageing. They are devising an
experiment to create a mouse in which senescent cells
—
those that no longer divide
—
are prevented from accumulating. They plan
to activate a gene in the mouse that will selectively eliminate senescent cells. Such a mouse could demonstrate whether it is
possible to avoid growing old.
But successful ageing is being promoted here and now. Older people who engage in a lot of social interactions stay young for
their chronological age, argues John Rowe, a professor of medicine and geriatrics at the Mount Sinai School of Medicine in New
York. Research has shown that people who receive emotional support not only have higher physical performance than their isolated
counterparts, but also that they show lower levels of hormones that are associated with stress.
Other work, led by Teresa Seeman of the University of
California, Los Angeles, shows that “allostatic load”—
the cumulative
physiological toll exacted on the body
—
predicts life expectancy well. It is measured using variables including blood pressure and
levels of stress hormones.
Dr Seeman found that elderly people with high degrees of social engagement had lower allostatic loads. They were also more
likely to be well educated and to have a high socio-economic status. It would thus appear that death can be postponed by various
means and healthy ageing extended by others. Whether death will remain the ultimate consequence of growing old remains to be
seen.

Waving at the neighbours
The search for extra-terrestrial life
HUMAN beings are, on an astronomical timescale, recent arrivals
—
and when you first arrive in the neighbourhood, it is only
polite to say hello to the neighbours. That, at least, is the attitude of the SETI Institute. SETI stands for the Search for
Extra-Terrestrial Intelligence, and that search has been going on, in various institutional guises, since 1960.
The SETI Institute's members reckon the best way to get in touch is by radio, so they have begged and borrowed time on the
world's radio telescopes to listen either for signals deliberately being broadcast by other technological species who want to make
themselves known, or for radio signals intended for domestic alien consumption that have simply leaked into space. So far, though,
they have heard nothing.
Part of the problem is probably that intelligent aliens are thin on the ground and there are an awful lot of stars. With this in
mind, Margaret Turnbull of the Carnegie Institution of Washington, DC, has, as she explained to last week's meeting of the
American Association for the Advancement of Science, been trying to refine the target list by going through the catalogue of the
120,000 stars closest to Earth and eliminating unsuitable ones to leave a subset
of “habstars” with more potential to support
intelligent life.
Dr Turnbull starts from the premise that every star has a zone around it with the right temperature to support
carbon-and-water-based life, the only sort so far known to exist. If there are suitable planets in this zone, they might contain life.
First to be tossed out, therefore, are stars lacking the metallic elements needed for planet formation. Astronomers have a rather
odd definition of a metal, so that any element heavier than helium counts. Carbon, oxygen, nitrogen and silicon are all metals in the
astronomical sense. Dr Turnbull, though, uses iron, a real metal, for her assay. A star's light reveals how much iron it contains, and
thus whether planets are likely to have formed around it.
After that, variable stars are thrown out, since they have moving habitable zones. Most binary stars go, too, because planets
orbiting them would move in and out of the habzone. And stars that have ballooned into red giants or dwindled into white dwarfs
are also rejected.
Finally, she throws out stars that are too young. Some of these are obvious, because they are burning so fast that they will
never make their three billionth birthdays, which is the minimum amount of time that Dr Turnbull reckons is needed to go from
uninhabited rock to technological civilisation. Other, slower-burning stars have their light analysed to see how much helium they
contain, and thus how long they have been fusing hydrogen to helium to power themselves.
The result is a list of 17,000 habstars
—
still quite a lot, but far fewer than if the search were carried out exhaustively. If ET is
out there, his hunters now have a better idea where to look.

Decoupled
The health of companies and the wealth of economies no longer go together
“NOTHING contributes so much to the prosperity and happiness of a country as high profits,” said David Ricardo, a
British
economist, in the early 19th century. Today, however, corporate profits are booming in economies, such as Germany's, which have
been stagnating. And virtually everywhere, even as profits surge, workers' real incomes have been flat or even falling. In other
words, the old relationship between corporate and national prosperity has broken down.
This observation has two sides to it. First, as Stephen King and Janet Henry, of the HSBC bank, point out, companies are no
longer tied to the economic conditions and policies of the countries in which they are listed. Firms in Europe are delivering
handsome profits that are more in line with the performance of the robust global economy than with that of their sclerotic
homelands. In the past two years, the earnings per share of big listed companies have climbed by over 100% in Germany, 50% in
France, 70% in Japan and 35% in America. No wonder Europe's and Japan's stockmarkets have outpaced those in America, despite
the latter's faster GDP growth.
Second and more worrying, the success of companies no longer guarantees the prosperity of domestic economies or, more
particularly, of domestic workers. Fatter profits are supposed to encourage firms to invest more, to offer higher wages and to hire
more workers. Yet even though profits' share of national income in the G7 economies is close to an all-time high, corporate
investment has been unusually weak in recent years. Companies have been reluctant to increase hiring or wages by as much as in
previous recoveries. In America, a bigger slice of the increase in national income has gone to profits than in any recovery since
1945.
The main reason why the health of companies and economies have become detached is that big firms have become more
international. The world's 40 biggest multinationals now employ, on average, 55% of their workforces in foreign countries and earn
59% of their revenues abroad. According to an analysis by Patrick Artus, chief economist of IXIS, a French investment bank, only
53% of the staff of companies in the DAX 30 stockmarket index are based in Germany; and only one-third of those firms' total
turnover comes from there. Only 43% of all the jobs at companies in France's CAC 40 are in France. With the profits of these firms
so dependent on their global operations, it is not surprising t
hat corporate prosperity has failed to spur “home” economies.

American and Japanese companies remain more closely tied to their domestic markets. Just one-fifth of the turnover of firms
in Japan's Nikkei index comes from overseas. Foreign sales of America's S&P 500 companies amount to a modest 25% of the total.
Even so, at the 50 biggest firms the figure is higher, at around 40%. The old
saying, “What's good for General Motors is good for
America”, no longer rings true: over one
-third of GM's employees work outside the group's home country.
If a large part of the spurt in profits comes from foreign operations, it is less likely to be used to finance investment or extra
job creation at home. If they reason that the recent past is a fair guide to the immediate future, companies are likely to plough their
extra profit into further investment abroad. Alternatively, they may buy back shares or repay debt.