Windows 7 Will Succeed and Fail on Netbooks

Story: Windows 7 may not be the solution for the troubled MicrosoftTotal Replies: 39
Author Content
caitlyn

Mar 11, 2009
4:44 PM EDT
The only way Windows 7 will run well on netbooks, at least so long as the 1.6GHz processoy limitation Microsoft effectively imposed on manufacturers remains in place, is in a very stripped down form with very little functionality. This will create a new opening for better optimized netbook Linux distributions including Moblin and Android. Microsoft will fail to shrink Linux market share any further. Quite the contrary: ARM-based netbooks will only run Linux, not Windows. OTOH, they will succeed in that they and their cadre of so-called journalists will continue to churn out anti-Linux FUD and people will continue to buy what they know which is Windows. Some manufacturers will feel compelled to push Windows. So, they will succeed in being the majority player in the netbook market.
DiBosco

Mar 11, 2009
4:55 PM EDT
I've been very encouraged to learn in the last few days that a friend and a colleague recently bought Acer Aspire Ones after seeing mine and in both cases went for the Linux version. Both these people were very sceptical at first, but listened to what I said and are very pleased with it. As they were both previously only Windows users I think it shows that Linux stands a very good chance of at the very least holding a thirty percent market share with the Atom based laptops. Once these Arm Cortex A8 processors are adopted and people have the choice of an eight hour battery life with Linux I am convinced people will be even more open to trying it [Linux].

From what I have read somewhere Microsoft are talking about a Win7 version that will only run three apps at once. They will surely really **** people off with something like that.
tuxchick

Mar 11, 2009
4:55 PM EDT
Caitlyn, what is this 1.6GHz limitation? Would you mind pointing to a link or two? I seem to recall hearing about it, and it would fit perfectly with something I'm thinking about right now.
caitlyn

Mar 11, 2009
5:02 PM EDT
tc: I'll try and find you a link. The deal was that Microsoft would offer XP at a bargain basement price only if manufacturers would limit the specs of netbooks.
caitlyn

Mar 11, 2009
5:07 PM EDT
OK, I found a couple of links. There are probably better ones out there but these should get you started:

Memory limit (1GB): http://apcmag.com/microsoft_hobbles_xp_mininotes_with_1gb_ra...

Sceen size/storage limits: http://arstechnica.com/hardware/news/2008/09/microsoft-eases...

All limits: http://www.computerworld.com/action/article.do?command=viewA...

The 1GHz processor limit was eventually raised to 1.6GHz.

HTH
tuxchick

Mar 11, 2009
5:08 PM EDT
k, I'll test my own google-fu after work. Sheesh, while the EU and US DOJ go all ninja over browsers as if they were important, the OEM collusion rolls merrily along.
caitlyn

Mar 11, 2009
5:56 PM EDT
tc: Yep, you're spot on with your last comment. Somehow, though, I think the Obama administration is just as corporation friendly as the Bush administration was. Don't expect any DOJ action on this anytime soon.
tracyanne

Mar 11, 2009
6:27 PM EDT
Quoting:I think the Obama administration is just as corporation friendly as the Bush administration was.


And that's surprising?

We laughed ourselves silly, watching yanks react to Obama as if it was the second coming.
gus3

Mar 11, 2009
7:35 PM EDT
TA,

Not all of us were, and the biggest concentration of those who were was to be found in Big Media.
caitlyn

Mar 11, 2009
7:51 PM EDT
TA: No, of course it isn't surprising. How many corporate millions went into the Obama campaign? Of course this administration is big business friendly. Until we go to publicly financed campaigns (which probably will never happen) all our politicians are bought and paid for.
bigg

Mar 11, 2009
7:51 PM EDT
I smell TOS violation.

> Don't expect any DOJ action on this anytime soon.

If they didn't take action before, they won't take action now. That's because most of those decisions are not made by political appointees.
NoDough

Mar 11, 2009
9:47 PM EDT
>> We laughed ourselves silly, watching yanks react to Obama as if it was the second coming.

Glad somebody got something positive out of it.
jdixon

Mar 11, 2009
10:00 PM EDT
> Glad somebody got something positive out of it.

Oh, I'm pretty sure we'll get something positive out of it. Unless you don't consider 20%+ inflation positive, that is.
caitlyn

Mar 12, 2009
2:21 AM EDT
@jdixon: I don't think we're going to see much inflation. It all depends on how sharply demand for goods and services continue to fall. One characteristic of a depression we haven't seen yet is deflation -- prices actually falling because demand is so low. This is one thing Keynesian economics, particularly increased government spending, is designed to counteract. During the Great Depression the New Deal did have that effect.

One debate going on right now is what got us out of the Great Depression. The way I read the history is that the depression only worsened under Hoover (1929-32). There was improvement and a sharp drop in unemployment once the New Deal got going. The economy improved significantly from 1934-36. In 1937 things went backwards again, largely because FDR became concerned with balancing the budget and scaled back federal spending. It was the aid to the British in the early days of WWII and then the massive spending on the military once the U.S. entered the war that finally brought the country out of depression.

I don't want to get into a debate over current economic policy because that would most certainly be a TOS violation. I do have concerns but I suspect they are very different than yours. Let's leave it at that. :)
gus3

Mar 12, 2009
2:35 AM EDT
@caitlyn: Two closely-tracked prices, real estate and gasoline, are dropping. In my area, gasoline prices for 87-octane are holding just under US$2.00, where 18 months ago they were approaching $4.00.
caitlyn

Mar 12, 2009
3:19 AM EDT
@gus3: You are correct. I just paid $1.84 for gas. The price here peaked around $4.09. I'd argue that what has happened with gasoline prices involves more factors than just reduced demand due to recession/depression though that is clearly part of the cause. In the case of housing there was a bubble which burst which helped trigger the depression/recession. Continued fall in prices could be attributed to reduced demand in part. Overall, though, the U.S. still has very mild inflation, or did in 2008. If 2009 brings deflation that would be a sure sign that this will eventually be recategorized as a depression rather than a recession.
DiBosco

Mar 12, 2009
5:16 AM EDT
@caitlyn, you don't know how lucky you are! We pay £1 or so a litre. 4.22 litres in a gallon, so around £4.20 a gallon. Even allowing for the low exchange rate and American gallons being smaller than British gallons, we're paying well over double the US price!

House prices here are aloso dropping, but I do think it's a necessity. It had got to the stage where housing was becoming affordable for first time buyers and those who could buy had no money left after paying the mortgage each month.

BTW, TOS of lxer specifies you can't talk about political matters? If so, why not? (Not trying to be controversial, just don't understand why that would be. )
Sander_Marechal

Mar 12, 2009
6:24 AM EDT
DiBosco: Because political threads turn into nasty flamewars most of the time, and because politics has little to do with FOSS or Linux. This is a Linux and FOSS website.

At some points FOSS and politics do intersect (more and more it seems as FOSS keeps growing) and we usually don't start hitting people over the head with the TOS if the discussion stays focussed and civil, but it's better avoided. If you dig through the LXer archives you can find plenty of threads that went way over the line, turned into flamewars and where Scott or someone else had to step in.
montezuma

Mar 12, 2009
8:14 AM EDT
+1 Sander
jdixon

Mar 12, 2009
8:14 AM EDT
> I don't think we're going to see much inflation. It all depends on how sharply demand for goods and services continue to fall.

Absolutely correct. We have two competing forces at work, the deflation being caused by the current world wide recession vs. the inflation being pushed by the increased government spending.

The reason I'm arguing for inflation is that I expect the slow down to end sometime in the next 3 years, possibly as early as next year, but not the government spending.

> TOS of lxer specifies you can't talk about political matters?

Politics and religion, though as Sander says Scott and the others try to keep a loose rein when the matters intersect; which they do on occasion. They usually do a good job. Unfortunately, I tend to be one of the occasional offenders. :(
montezuma

Mar 12, 2009
9:17 AM EDT
For what it is worth consensus economic forecasts are about as accurate as you get in economics (which is not saying much). Here are some

http://www.philadelphiafed.org/research-and-data/real-time-c...

They show an inflation rate for 2010 and 2011 of 1.9% and 2.3% respectively. That does not sound at all bad.

The longer range forecast shows 2009-2013 2.2% 2009-2018 2.4%

Again hardly terrible.

With regard to a recovery they are showing a modest one in 2010.
NoDough

Mar 12, 2009
1:11 PM EDT
Inflation is caused by an oversupply of money. The more they print, the less it is worth, the more things cost.

http://www.foxnews.com/video2/video08.html

Edit: Yeah, I know. He's a right-winger. But ignore that and just think about the numbers.
bigg

Mar 12, 2009
1:34 PM EDT
> Inflation is caused by an oversupply of money. The more they print, the less it is worth, the more things cost.

Only in the very long run. Without going into the details (you can use Google if you choose) what is different now is that we have a 0% interest rate, in which case changes in the money supply have no effect on the economy. Japan has provided us with a perfect example. They increased the money supply by large amounts and they failed to get out of their deflation.

It is true that we have to worry about inflation once the interest rate goes above zero, but the Federal Reserve is aware of that and plans to reduce the money supply accordingly.
NoDough

Mar 12, 2009
2:01 PM EDT
Interesting, the link is no longer working for me. Or, rather, it is working but showing an entirely different, unrelated vid.
NoDough

Mar 12, 2009
2:12 PM EDT
OK, this is better. Here's the original chart from the Federal Reserve. http://research.stlouisfed.org/fred2/series/BOGAMBNS?cid=124

Bigg: In less than a year they pumped more new cash into the system than in the cumulative history or our county. There is no historical precedent for this. Do you really believe it's business as usual?
montezuma

Mar 12, 2009
2:33 PM EDT
NoDough,

The inflation forecast I linked was by the Fed also and was updated this month. I am therefore sure that the additional government debt (printed money as you put it) will have been taken into account by any competent economist and so should show up in their projection.

Some historical context is useful as well. In the mid 1940s the ratio of government debt to GDP was significantly higher than now. That period was not characterized by high inflation.

http://zfacts.com/metaPage/lib/National-Debt-GDP.gif http://en.wikipedia.org/wiki/File:USDebt.png

Bottom panel of the second link is the inflation adjusted data.
bigg

Mar 12, 2009
3:28 PM EDT
> In less than a year they pumped more new cash into the system than in the cumulative history or our county. There is no historical precedent for this. Do you really believe it's business as usual?

Yes, the monetary base has risen a lot. It's just that things are different when the interest rate is zero. Provided that the Fed cuts the monetary base when the interest rate starts rising, we should not get hit with inflation.

The Japanese case does provide a precedent because they ran into the zero interest rate as well. I don't have a fancy graph to link to, but the Bank of Japan website shows that Japanese monetary base growth peaked at 36.3% in April 2002. In November 2006 the rate of change fell to -22.3%. (Series BJ'MABS1AN11@) They have not had any problems with inflation.

Just to clarify - I'm not disputing that money growth will cause inflation, but I disagree that it will be a problem now, and expect the Fed to appropriately cut the monetary base at a later date.
NoDough

Mar 12, 2009
3:43 PM EDT
It'll be interesting to see how this plays out. I still say you can't play these games with the monetary base without inflation; zero interest or not.

We should revisit this thread in 6 months and compare reality to our guesses. Somebody will get told-you-so rights. ;-)
bigg

Mar 12, 2009
3:48 PM EDT
> We should revisit this thread in 6 months and compare reality to our guesses.

I'll have to leave that to you. I have trouble remembering appointments six hours into the future.
NoDough

Mar 12, 2009
4:01 PM EDT
>> I'll have to leave that to you. I have trouble remembering appointments six hours into the future.

Man, do I know that feeling. Getting older sucks. The only thing worse is not getting older.
jdixon

Mar 12, 2009
4:48 PM EDT
> It's just that things are different when the interest rate is zero.

Not really. Deflation can trump an increasing money supply, especially if you don't do a good job of getting the money into the economy. It's called pushing on a string.

> Provided that the Fed cuts the monetary base when the interest rate starts rising, we should not get hit with inflation.

True, but that's a loophole big enough to drive a semi through. If the government insists on maintaining spending levels, interest rates will have to go through the roof to cut the money supply by that amount. If the government cuts spending accordingly, then I'll grant that you should be correct.

With the current administration, I expect government spending to decline about the same time pigs start filing flight plans. I'd love to be wrong about that, of course.
caitlyn

Mar 12, 2009
5:10 PM EDT
If the government insists on maintaining spending levels, interest rates will have to go through the roof to cut the money supply by that amount. If the government cuts spending accordingly, then I'll grant that you should be correct.

I completely disagree. During 1933-1936 FDR spent huge amounts of money on the New Deal. Inflation did not resume. The deflation cycle was arrested but there was no inflation. When FDR decided to tackle the federal budget deficit and reduce spending the result was that the economy went into reverse again. Only when spending resumed in 1938 did the economy start to recover again. When spending went through the roof as the U.S. first aided the British in WWII and then entered the war the depression finally ended.

Cutting spending and even freezing spending was tried during the Great Depression from 1929-1932 by the Hoover administration. The depression only got worse.

We don't need less spending. We don't need tax cuts which don't stimulate much. What we need is new WPA or TVA type projects that put people to work. When people work they can spend which increases demand which stops the downward spiral.

In another thread I pointed out that what we are seeing now really does parallel the beginnings of the Great Depression. We don't have deflation *YET* except in gas and housing prices. We do have rapidly rising unemployment leading to a reduction in demand leading to less production leading to more unemployment.

In another thread I pointed to the writing of Marriner Eccles, Chariman of the Federal Reserve under FDR. His theories actually predated Keynes and when you read what he wrote or his testimony at the time it actually sounds frighteningly like what we are seeing today. The following is from his book "Beckoning Frontiers". I'm going to quote a part of what is quoted on WikiPedia:

As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth -- not of existing wealth, but of wealth as it is currently produced -- to provide men with buying power equal to the amount of goods and services offered by the nation's economic machinery. [Emphasis in original.]

Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.


[...]

Debtors thereupon were forced to curtail their consumption in an effort to create a margin that could be applied to the reduction of outstanding debts. This naturally reduced the demand for goods of all kinds and brought on what seemed to be overproduction, but was in reality underconsumption when judged in terms of the real world instead of the money world. This, in turn, brought about a fall in prices and employment.

Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices. Earnings began to disappear, requiring economies of all kinds in the wages, salaries, and time of those employed. And thus again the vicious circle of deflation was closed until one third of the entire working population was unemployed, with our national income reduced by fifty per cent, and with the aggregate debt burden greater than ever before, not in dollars, but measured by current values and income that represented the ability to pay.


No, none of my ideas are original :)

In the other thread I also linked Eccles' testimony to the U.S. Senate in 1933. It's 36 pages long but it's well worth reading precisely because so much of it reads like what's happening right now. [url=http://fraser.stlouisfed.org/docs/MeltzerPDFs/ecctes33.pdf#search='marriner eccles']http://fraser.stlouisfed.org/docs/MeltzerPDFs/ecctes33.pdf#s...[/url]
jdixon

Mar 12, 2009
5:46 PM EDT
Caitlyn, the section you quoted has little to do with your comment. My comment was solely a comment concerning money supply and interest rates. High interest rates act to slow the growth of the money supply. Increased government spending grows the money supply. If you want to reduce the money supply, but maintain government spending levels, your only real option is to increase interest rates. Whether maintaining government spending is a good or bad thing has nothing to do with the matter, and wasn't what I was discussing.

> We don't need less spending.

I didn't say we did. That's another discussion entirely, and would definitely result in a TOS violation.

> We don't need tax cuts which don't stimulate much.

Agreed, though tax cuts which do might be a good thing right now. :)

Whether, as a general principle, tax cuts stimulate the economy is a well tested historical matter. I'll leave it for others to review the information available and decide for themselves. Again, arguing the point would eventually result in a TOS violation,

> We don't have deflation *YET* except in gas and housing prices.

Well, I'd argue you could add stock prices to the list. :)

Since gas prices were largely responsible for our recent high inflation, I expect a decline in general prices in a few months as the drop in gas prices works it's way through the system.

Anyway. I never said that increased government spending was, in this specific case, a bad thing. I said that if the economy improves, maintaining that level of spending will result in inflation unless the money supply is decreased and that decreasing the money supply will require significantly higher interest rates. That's a simple economic analysis, not a political position.

I'm well aware of the Keynesian viewpoint, Caitlyn. I'm also aware of the Chicago school and the Austrian school and both of their basic theories (though I'm not a trained economist). There's no point in quoting them to me, though others may find them useful.
montezuma

Mar 12, 2009
6:04 PM EDT
This dispute appears to be whether one subscribes to a monetarist or Keynesian view of the economy.

Monetarism became popular in the late 1970s when wage inflation was the big problem. Keynesian ideas became popular in the 1930s when a deflationary spiral was in evidence.

Moneterists believe that inflation is caused by an increase in the money supply. Keynesians believe you can disrupt a deflationary spiral by government deficit spending.

Why wasn't the massive spending of the 1930s and early 1940s inflationary? I think it was because the large economic growth that occurred after 1945 allowed the government to get back into balance by increasing tax revenues. Such revenues did not increase because of higher tax rates but because more people were paying tax on higher incomes.

So I don't think the key question here is really whether the federal government exercises discipline down the track it is more a question of how strong the economic recovery will be because that will enable the government to reduce debt through increased tax receipts.

If there is not a good recovery in 2011 and 2012 then that is when we need to worry.
jdixon

Mar 12, 2009
6:23 PM EDT
> Moneterists believe that inflation is caused by an increase in the money supply. > Keynesians believe you can disrupt a deflationary spiral by government deficit spending.

Correct on both counts.

There's no inherent conflict between the two theories, so there's no reason both can't be true, and I believe that most economists now accept that's the case.

> Why wasn't the massive spending of the 1930s and early 1940s inflationary?

The classical answer would be because the growth of GDP was enough to absorb the impact. Also, how much of that was deficit spending? By my understanding, non-deficit government spending doesn't inflate the money supply, as that's money which would have entered the economy anyway.

> So I don't think the key question here is really whether the federal government exercises discipline down the track it is more a question of how strong the economic recovery will be because that will enable the government to reduce debt through increased tax receipts.

No recent government has been able to hold spending low enough that the recovery allowed them to reduce debt. This has been true for both Republican and Democratic administrations. Even the Clinton administration did not do so if the debts of Social Security and Medicare were counted. So there's no recent historical precedent for believing that will be the case. Again, I'd love to be proven wrong.
montezuma

Mar 12, 2009
6:36 PM EDT
I agree that there is no inherent contradiction because the two prescriptions were aimed at very different problems and both appeared to be partially successful in their different jobs.

The dispute comes when analyzing the nature of the present crisis. If you think it is another Great Depression then you would have to back the Keynesian approach. If you think it is not nearly that bad and therefore the quick recovery will bring the release of excess demand from the government spending then you will be looking for monetarist discipline down the track.

It should be pretty obvious within 6 months or so which view is closer to the mark. We have deflation now. If it accelerates as unemployment sky rockets then the pessimistic Keynesians will prove right. If we come out of the downturn strongly then monetarists will likely prevail.
montezuma

Mar 12, 2009
6:44 PM EDT
>Also, how much of that was deficit spending? By my understanding, non-deficit government spending doesn't inflate the money supply, as that's money which would have entered the economy anyway.

If you look at my plot above of debt in the 1940s you will see that virtually all of that was government debt which must have been generated by deficit spending because of WW2 primarily and the New Deal secondarily. The huge run up of debt came from somewhere right?
azerthoth

Mar 12, 2009
6:49 PM EDT
While an interesting read, and on a subject that it would be best for me to avoid, this conversation is being held on two threads ... any chance I could convince all the parties to consolidate on one?
caitlyn

Mar 12, 2009
7:53 PM EDT
Azerthoth: Yes, by all means. How do we do that?

Montezuma: The dispute comes when analyzing the nature of the present crisis. If you think it is another Great Depression then you would have to back the Keynesian approach.

Exactly. I am on record as having called this a Second Great Depression by the fall of last year.

jdixon: There's no inherent conflict between the two theories, so there's no reason both can't be true, and I believe that most economists now accept that's the case.

Also correct. I cited Fisher (a monterist) and Eccles (essentially Keynesian before Keynes).

I think montezuma hit the nail on the head. Unless you are a rigid ideologue from either the left or the right the solution you support depends on your interpretation of what this crisis really is. I read about the early part of the Great Depression and I am amazed at how much it seems like I am reading about today.
jdixon

Mar 12, 2009
8:09 PM EDT
> It should be pretty obvious within 6 months or so which view is closer to the mark.

Agreed. I'm hoping it's merely a severe recession, but I'm expecting the worst. That way I'm guaranteed not to be disappointed. :)

> If you look at my plot above of debt...

Ah, I'd forgotten it. Yes, from the chart, it appears that the 1940 spending was indeed deficit spending, in which case the classical answer about GDP growth is probably correct, as shown by the drop in debt/GDP in the second chart starting in '46 or so.. Following Keynesian theory, It's also possible that the spending was replacing depressed private spending, which would not have been inflationary. I don't think the Chicago school would agree about that last, but...

> ...on a subject that it would be best for me to avoid,

A wiser man than I, apparently. :)

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