The Wall Street Journal reports that the job market for practitioners of the dismal science is dreadful. Columbia University isn't hiring anyone this year. Three other colleges have stopped looking for economics professors. Harvard's hiring one professor, rather than two or three.

And academia is one of the few job options left, with investment banks having disappeared altogether. Government agencies are slow to increase their budgets, and competition for those jobs have increased. It's a simple matter of supply and demand, as any economist would tell you.

The current contraction was a year old before we even figured out it was happening, which makes it longer than the average postwar recession. Here's why it could be exceptional.

In the middle of this decade, then-revered Federal Reserve chief Alan Greenspan believed that information technology had transformed the very nature of recession. Just-in-time inventory, supply-chain dashboards, and an army of permalancers made adapting to changing business conditions so easy, so quick, that old-school recessions, defined by two consecutive quarters of economic shrinkage, would be a thing of the past. Instead, we would experience a series of microrecessions — a down month here or there, followed by upticks — all happening so quickly we barely felt the prick.

Ah, for the good old days of microrecessions.

What's happened now is something akin to the introduction of automated trading on Wall Street. What made 1987's Black Monday stock-market crash so devastating was the unforeseen triggering of an avalanche of selling by computer. After that, the market installed circuit breakers to prevent a recurrence.

What Wall Street had two decades ago, we now have business at large. Idiocracy, the hilariously dystopian Mike Judge movie, has a scene where the clueless CEO of a giant corporation complains that the computers laid everyone off when the stock dropped. That's something close to what happened in the Panic of '08. As bad news cascaded through the system, they triggered layoffs and cutbacks, which then prompted consumers to cut spending, causing yet more danger bells to ring.

And all of this unfolded amidst a global economy already in recession. China and India, once seen as engines of growth for the world, are in parlous states. Most frighteningly, China's imports, which have propped up old-world economies like Germany, dropped 18 percent from a year ago. India, already running a large budget deficit, has little room to stimulate its economy. Dropping oil prices, meanwhile, have taken the wind out of petroeconomies like Russia, Venezuela, and Saudi Arabia.

That's why I think the recession could be far longer than the 18 months most economists predict. Where, exactly, is growth supposed to come from? U.S. consumers and businesses are reeling from debt. The rest of the world is hardly better off. The expectation that government spending will lift us out of this mess seems akin to expecting that President Change will deliver us all a new bicycle.

The Pollyanna response is that the same information technology which helped the recession unfold so quickly will help businesses spot opportunities for growth, making the recovery all the quicker. I doubt it. Human psychology teaches us that we are far more motivated by fear of loss than the promise of gain. (Greed, it turns out, is good — because it's so much scarcer than we imagine.) Singed by the suddenness of panic, we will be much less likely to respond to glimmers of hope. 18 months? We should be so lucky. Try three years — or longer.

Ad Age predicts a small amount of growth:

If trends hold, online advertising will grow in the low double digits or high single digits this year, driven largely by search.

But that may be way too optimistic. A pessimistic view would be to compare this financial crisis to the end of the tech bubble years, when internet advertising dropped by about 25%. And then to note that this crisis is actually far worse than that one was. So while search ads will probably not stop growing, it's possible that the rest of internet advertising could fall by more than a quarter, taking the ho-hum companies at the bottom of the market straight into oblivion.

Recent startups will be quick to fail. Aspiring startups will fail to get funded. There will probably be a rise in sites charging subscription fees, as the ad model stops bringing in sufficient cash—which may itself fail, since people are so used to everything being free. And what about our heroes, smartass blogs?

Publishers may not be immune to a big cull after growing up in what Spark Capital principal Dennis Miller calls a "fantasy marketplace." "You will probably see a healthy movement to two or three in each category that are delivering visitors and time spent on the site," he said.

Gawker, Drudge, and LOLCats: the only news left at the end of the internet apocalypse. [Ad Age]

The first thing to get cut in everyone's ad budget was "experimental" ad buys, random things like branded pop-up games and ads in Virtual Worlds and other, mostly online things that probably never worked in the first place. Also getting chopped: mobile ads that go straight to your cellphone—which not only don't work, but actually annoy the consumer in the process of not working.

Areas like mobile, virtual worlds and widgets are expected to be hit particularly hard, as it remains unclear what kind of impact ads in these media have. These campaigns often reach a small number of people, and standard measurement systems have yet to be developed. "When we get into the need to drive results, you can't spend money on the experiments and hope to keep your job and get your sales goals"...

"Virtual worlds are probably one of the things that haven't been proven effective just yet. I can't see us selling virtual worlds to anybody right now," says Lars Bastholm, an executive creative director at independent digital marketing shop AKQA.

Good news for nerds of the purist variety! [WSJ; pic via FPSrantings]

It's no wonder Roubini has earned the nickname Dr. Doom. One website suggests a Halloween mask of his unsmiling visage. And the New York Times chose a photograph (left) of the Stern School 'permabear' to go with this description. "With a dour manner and an aura of gloom about him, Roubini gives the impression of being permanently pained, as if the burden of what he knows is almost too much for him to bear. He rarely smiles, and when he does, his face, topped by an unruly mop of brown hair, contorts into something more closely resembling a grimace."

It's time to call bullshit. The image of Dr. Doom may satisfy the needs of the media and partygoers this Halloween—but Roubini is anything but dour. The 50-year-old Iranian-Jewish economist is a promiscuous Facebook friend who draws a cosmopolitan crowd to the frequent parties at his Tribeca loft—an apartment with walls indented with plaster vulvas, incidentally. As this party photograph shows (right), the professor's gloomy public image is entirely at odds with his playboy lifestyle. In a Facebook message, Roubini makes no apology:

Dear Nick, I work very very hard and I also enjoy life. My home is also partially a cultural salon where I host book parties, debate and election night events, independent film screnings, live music nights, theater/performance acts, fashion shows, dinner parties and even plain old fashioned dance parties.

I have this professional Dr Doom nickname but I am quite a cheerful person with a few close friends and eclectic group of friends who, like most New Yorkers, are members of the creative class. The innovations of lawyers and bankers can be as creative as those of visual or performing artists, at times too creative you may say given the current financial meltdown. So I live life to its fullest. To paraphrase Seinfeld; anything wrong with that?

Market crashes are, almost without argument, the biggest business stories there are. They're the wars of the financial world. Bull markets, runaway successes, and bubbles are all well and good from the reader's point of view—and they do tend to spawn new titles—but they lack the element of tragedy and fear that mark truly great stories. Ten years from now, business outlets will be judged by their coverage of this meltdown in the same way that the New York Times was judged by its 9/11 coverage, or the Littleton Independent was judged by its Columbine coverage.

That said, the business side of business media should be booming, right? Audiences are up! Everyone is addicted to CNBC! The Wall Street Journal has been unmissable for a solid month! And it's fair to assume that readership and viewership is up across the board for business outlets, to varying degrees. Fear makes people extremely interested in information.

Here's the quandary: The biggest story for business media always comes along at the same time as the worst ad market. By definition, unfortunately! Market crashes are great from a reporter's standpoint. From an ad salesman's standpoint, they're horrible. So a site like The Big Money, which would seem to have had the good fortune to launch on the wings of a massive story, is actually getting choked by the very same conditions it's reporting on.

There's already speculation that Portfolio, Conde Nast's $100 million business offering, is on shaky legs. We know that the Great Magazine Die-Off caused by this shitty economic period is already underway. And ironically, mags like BusinessWeek or Fortune could be likely candidates for severe cutbacks, if not actually death.

And hey, the publisher of Fast Company—actually a good magazine!—was just forced to lay off 20 people. That's a lot for a mid-sized place like that.The publisher, Mansueto, is also ending free snacks, gym reimbursements, and, worst of all, closing its Events division.

That's a terrifying sign, since there are lots of business publications out there that (shhh!) make more money off their events than they do off their publication. In some cases, a shitty magazine is just a loss leader for a moneymaking side business of awards shows, seminars, and other branded events that companies will shell out for in order to "network" and have allegedly independent awards to use in their marketing materials.

But when the businesses themselves tank, the business media tanks harder. It's as if Sports Illustrated saw all of its ads evaporate at Super Bowl time. It sucks, but it's a fact of media life. The survivors will come out stronger than ever, and can feast on the carcasses of their dead competitors, picking off choice talent at low prices.

Journalism!

The incident caused an uproar, but look at what it really was: one guy with a fake post on an unmediated citizen journalism site. Making any stock selling decisions based on that is approximately as risky as making the same decision based on a Craigslist post. It's an inherent gamble. Jeff Jarvis is sanguine:

Every time so-called citizen journalism muffs one, I get such calls, as if to say, look what your bratty kid is up to now. Funny, I don't get them – as a journalist – every time a reporter messes up.

I told these reporters that they were on the tail of the wrong story. This may not be about citizen journalism at all. It may be about someone trying to game Apple stock and using, nefariously, whatever tools were available. I also told them that anyone who sold their stock on the basis of a pseudonymous post on the web was a fool who deserved what they got.

He's right! And furthermore, anyone familiar with online media would have known right off the bat that there's no guarantee of the accuracy of the rumor like that. Have you looked at the internet lately?

So while the majority of internet readers took the whole thing with a grain of salt, the traders who didn't are now in an uproar. It's interesting to contrast this with the recent debunked rumor about a (nonexistent) Esquire story on Anne Hathaway in which the actress supposedly said she loves anal sex. That one got far more credulous coverage than the Jobs rumor. Why? Because it cited a print source—Esquire—which even trash-talking bloggers like us subconsciously assume is trustworthy. (Even if the actual interview didn't turn out to exist).

The lesson: rumors are rumors are rumors. The main thing the sketchiness of internet rumors reveals is the underlying sketchiness of print rumors, too. If you trade on a rumor and get burned, don't cry about it. It's all about learning.

On the one hand, a childhood pal — Russell's mom was reportedly best friends with Levy's mom — can do far worse than guiding one to tens of millions of dollars in wealth. And Pilot Group did more than passively watch its investment grow. From what we hear, Pittman's salesmanship was key to growing Daily Candy's advertising base. Such involvement would be in keeping with Pilot Group's focus on taking a "control position" in its investments. After the investment firm acquired Daily Candy, the newsletter's subscriber count grew tenfold to 2.5 million.

But not everyone buys that version of events. Said the tipster, an AOL veteran who followed Daily Candy closely:

For Pittman to brag that subscribers have increased since he made

the investment is just private equity puffery and delusion. That

would be like my grandmother taking credit for the business success of

the stocks she owns.

Perhaps Russell's help was not so selfless. As our source notes, Russell's advice on the deal would have been "highly conflicted," Russell having worked for Pittman for several months before the Daily Candy investment closed in late 2003.

His line to other potential portfolio

companies and strategic partners is that through his friendship with

Dany, HE was responsible for the early success of Daily Candy as a

startup, so he didn't feel compunction about duping the original

shareholders... Whatever the case, Pittman was not a genius to have his

junior guy abuse a family friendship in a predatory deal.

Let this be a lesson to startup founders who are not yet sufficiently cautions about venture capital investment, or who spend too much time worrying about whether their fameball girlfriends really truly love them for the right reasons: If you're not careful, you might have to settle for a paltry $25 mil when the big payday comes. After taxes, you'll barely be able to afford a decent loft!

• Google: WebsiteOutlook value: $1.2 billion. Market cap: $153 billion.
• Daily Candy: WebsiteOutlook value: $112,000. Just sold for $125 million.
• Amazon.com: WebsiteOutlook value: $75 million. Market cap: $33 billion.
• Ebay: WebsiteOutlook value: $134 million. Market cap: $33 billion.
• Mediabistro: WebsiteOutlook value: $459,000. Sold for $23 million. Then again, [joke].

[via Mental Floss]

Because America is not part of Europe. You know what would happen if we joined the European Union? Let's "mark to market" our economic figures to Euros for a second. (This is not a particularly meaningful exercise, but when the Gross Domestic Product is passing for the ultimate barometer of economic health I feel entitled to dabble in the absurd.) In the same amount of time that our economy cracked the $14 trillion mark, it would have shrunk 10% to 9 trillion Euros. In other words, no one would be lining up to buy cheap American exports. Of course, not that that much stuff is made in America anymore, which is why our 13% increase in exports of goods only contributed 0.2% in the way of GDP growth. But 0.2% can make all the difference!

Because The Rest Of The World Is Starving Thanks to land and pork barrel politics, agriculture remains a thriving (if small) sector of the American economy, and thanks to those same pork barrel politics we decided to drive food prices higher than oil prices would have already rendered them by paying people to use perfectly good corn to run cars or somesuch. Well, we make corn in America! And soybeans, and lots of other things that will make you fat if you aren't living on $3 a day in Nairobi.

Because The Rest Of The World Is Still Coming Here (And Fewer Than Ever Are Sending Their Money Home) America's growing population helps our GDP numbers sound good even when everything is actually getting harder for the average person! Between 2003 and 2007, for instance, our per-capita GDP grew less than 1.9% a year on average; Japan's per-capita GDP grew 2.1%! But thanks to our swelling immigrant class (and possibly, the celebrity baby boom) we have a growing populace that pumps that number up to nearly 3% annualized growth when we pool our funds together!

Because Everyone Is Sick, And Getting Sicker Health care a very important sector of the American economy — in fact, it's the only sector that's created any jobs since the nineties — and the costs — hey, every cost has a "benefit," hah! — just keep rising! That means lots of profits for all the companies working hard to remind us how bad heartburn can make you feel. And all the accountants and managers and lawyers responsible for figuring out how hospitals can add treatments and procedures to routine hospital stays so the insurance companies actually pay them; they are drivers of economic activity too! In this most recent quarter, medical care might have been the single brightest spot of a very unhappy chart: costs rose 12.1% over the quarter.

Because banks control all the money. The financial sector might seem like it's a mess right now, but they didn't get to represent more than a fifth of the whole GDP by being unclever. After getting the government to set up a special body giving them "immunity" from failure in the wake of that touching Jimmy Stewart movie, bankers quickly set about figuring out how to control all the money in the universe and take a big a cut possible each year in fear someone would figure out what they were up to and shut the whole thing down. Over time, of course, they realized that they controlled too much money for the government to ever shut any of it down, so at that point they just overpaid themselves because that's what they did last year, and because that's what everyone else was doing, and because if they didn't do it they were the greater fool. By 2005 the average finance worker earned 50% more than the comparable worker in any other field — and a lot of them made a lot more than that. But it's hard to blame them — absurdly profitable ideas like $3 ATM fees and selling repurposed mortgages to old people literally on a "fixed income" are all in a day's work for these guys.

Because "information processing equipment and software" sales increased 10.3%. And they haven't even released the new iPhone!

Because They Hate Us. These are serious times, Americans! We have a beautiful country to defend, and defense spending was perhaps the brightest spot on the latest GDP report of all. The Pentagon spent nearly $700 billion defending our freedoms last year, a 7.5% increase from last. And we haven't even started bombing Iran!

Image grabbed from Refacing Government Tender via Metafilter

BEA Press Release: Gross Domestic Product [Bureau of Economic Analysis]
Economists React: Recession "Still Likely" [WSJ]
Food Firms Profit As Demand Soars [WSJ]
Grossly Distorted Picture [Economist]
FDIC Seeks Hires, Braces For Trouble [WSJ]
Gross Domestic Product By Industry, Winners & Losers [Visualizing Economics]
What's Really Propping Up The Economy [BusinessWeek]
One Guy Who's Seen It All Doesn't Like What He Sees [WSJ]

Google has been searching the web for nearly 10 years, which is far longer than our major competitors. It's not surprising that we've learned a lot about how to do this well. We're constantly experimenting with new algorithms. Those that offer an improvement get rolled into the production version; the others go back to the drawing board for refinement.

He continues:

So I would argue that Google really does have a better product than the competition — not because we have more or better ingredients, but because we have better recipes. And we are continuously improving those recipes precisely because we know the competition is only a click away. We can't fall back on economies of scale, or switching costs, or network effects, to isolate us from the competition. The only thing we can do is work as hard as we can to keep our search quality better than that of the other engines.

Things took a hard turn when I was forced to cancel that project along with most of my Second Life public discussions and debates. Perhaps I can discuss the particulars later, but suffices for now to say that many in the Second Life community have zero tolerance for critics and criticism.