The rate of total homicide and the rate of homicide due to mental disorder rose steadily until the mid-1970s. From then there was a reversal in the rate of homicides attributed to mental disorder, which declined to historically low levels, while other homicides continued to rise.

Paper and press release.

Remember this the next time you read a newspaper article about how scared everyone is because some patients escaped from a mental institution:

We are convinced by the media that people with serious mental illnesses make a significant contribution to murders, and we formulate our approach as a society to tens of thousands of people on the basis of the actions of about 20. Once again, the decisions we make, the attitudes we have, and the prejudices we express are all entirely rational, when analysed in terms of the flawed information we are fed, only half chewed, from the mouths of morons.

My reply is that I don’t care must about reported dollar sales because these numbers are, for the most part, meaningless and mythical at this point in time. Large companies sell enterprise licenses and make up allocated numbers for the CEP/EP share of the pie based on a subjective formulation. They can sell an enterprise site license for $2,000,000 USD that includes CEP/EP software and claim 20% is CEP revenue, regardless of if the software is used or not.

Small companies nearly give software away with the hope of developing a strong public reference client, which are few and far between in 2008. Soon, I will start a Google spreadsheet, similar to what we did last year on this topic. Some folks don’t seem to like this initiative because, unfortunately, we will see that for this half of 2008, this year has been very lean for CEP/EP. Some would prefer I blog as a cheerleading evangelist versus an objective analyst. Go Fight Win! Rah Rah Rah!

Much of the current gloomy situation, of course, is because the entire market has fallen and IT spending is down. Financial companies announce record losses. Bankruptcies and restructuring are in the daily news.

In this depressed market, some companies have tried to tie the subprime crash to CEP, somehow implying that CEP would have helped, but that positioning is mostly fantasy. I work in the field of risk management at the corporate level and the current problems are not caused by a lack of technology, it is simply corporate greed - corporations taking high risks to stay competitive in a bull market and then they experience a frighteningly negative reversal during a market free fall.

Of course, the US Federal Reserve did not help matters when they decided to poke a gaping hole in the real estate bubble by dramatically raising interest rates without thinking about how they would manage the consequences, but that is another story! After all, the current top government executives in Washington DC are so politically, scientifically and economically incompetent that all we can do is hold our breath and count the days.

One risk management colleague often says,

“When then tide is high, you can’t see that the swimmers are naked.”

….and so it is in business. The current problems in the global market are based on human, social, and political errors and incompetence; nothing that technology can cure at this point in the game. So, the entire market is in decline, and folks are overhyping all software to keep the buzz going, as if CEP or SOA or BPM would have helped stopped the current global meltdown. Yes, CEP can stop global warming! Buy one today, save a cute polar bear!

Then again, maybe we only need a CEP engine in Washington; even a simple rules-based one would be good. Naturally, some would suggest that we need Neural Nets and Bayesian analytics; but I think just a simple rules-engine looking out the window that can process if-then-else conditions would be a great improvement over the mind-numbing leadership in Washington today.

Wi-Fi over Ethernet combines electromagnetic resonance--the ability of a EMF to excite signals in wires--with excess wired capacity in a manner similar to how broadband over powerline works. Where properly equipped 802.11af Ethernet switches and adapters are available, coupled with WOE-capable Wi-Fi systems, the Wi-Fi signals will simply be picked up and carried by the Ethernet network. Switching and transmission then become limited to the extent of the wired network--which will improve throughput and range. (A future standard might allow passive powering of lightweight devices from Ethernet, which is a neat reversal.)

This is in the same category of new convergent standards such as Bluetooth over 802.11 and FireWire (IEEE 1394) over IEEE 741-2007: ways to provide better specs on one standard by combining it with another that has a complementary purpose.

Now, of course, modern computing systems tend to include gigabit Ethernet and Wi-Fi, so why do we need a third modality that combines the two? Partly because of new devices like the MacBook Air and smartphones like BlackBerrys with Wi-Fi built in. Without an Ethernet adapter, the range of these devices can be limited, and throughput restricted.

You were waiting for the magic number: How fast is WoE? Nearly 1600 Mbps raw speed, and about 30 Mbps of raw throughput. Before you scoff, remember that you might be able to use WoE over hundreds of meters across a switched Ethernet network, where a Wi-Fi signal might stretch just a hundred or two hundred feet. If Wi-Fi beats WoE, a computer will use Wi-F.

The Wi-Fi Alliance hasn't set the date of their certification yet, but I'm told it will happen any day. The mark will be added to the list of A, B, G, Draft N, WMM Power Save, and other symbols, as AF. The industry is considering a campaign around the phrase, "WoE is me(tm)!" trying to capture the excitement of the new synergy. Again, unfortunate acronym.

The IEEE has finalized and approved a draft, but final ratification isn't expected until 1 April 2009.

As one of the primary authors for the vulnerability trends information, I will be hosting one of the webcasts on November 1, 2007 and you can register here:  Microsoft Security Intelligence Report: Overview of Latest Trends in Vulnerabilities and Malicious Software (Level 100).

If you want to quickly download the report in pdf, click on this link.

There are lots of interesting results (with charts) in the SIR and I encourage you to look the whole report.  However, here are a few of the things I would call out to you.

The number of disclosures of new software vulnerabilities across the industry continues
to be in the thousands, with more than 3,400 new vulnerabilities disclosed in
1H07. But this number actually represents a decrease from 2H06, the first period-to-period
decline in total vulnerabilities since 2003.

Note however, another trend as shown in the chart.  High severity vulnerabilities continue to grow significantly, while the overall total flattened out.   In the full report, you'll also note a trend reversal with complexity to exploit dropping as well.

There are a couple of other interesting results that I want to call out that you should examine with more detail in the full report

• Social engineering plays a growing role in overall malware attack techniques.  This is a key result since even with vulnerability-free software, these techniques could succeed against users of any platform.
• Windows Defender has proportionally detected 2.8 times less potentially unwanted software on computers running Windows Vista than on computers running Windows XP SP2, based on normalized data.   This is a practical measure of benefit that is somewhat more valuable in my opinion than vulnerability comparisons.

That is enough teasers. Download the report at www.microsoft.com/sir.

Regards ~ Jeff

• Fund Capacity: 20%
• Impact of Trades: 24%
• Textual Data: 2%
• Higher Moments: 2%
• Regime Shifts: 10%
• Volatility: 20%
• Extreme Events: 10%
• Momentum / Reversal: 31%
• Trends: 28%

• Shrinkage / Averaging: 9%
• Regime Shifting: 4%
• Nonlinear: 7%
• Contegration: 7%
• Cash Flow: 17%
• Behavioral: 16%
• Momentum / Reversal: 28%
• Regression: 36%