O.C. shooting suspect identified as college student with no record

Orange County sheriff's officials on Tuesday identified the suspect in series of fatal shootings and carjackings as Ali Syed, a 20-year-old community college student with no criminal record.

Authorities don't have a motive for the shootings, which began with the slaying of a woman at Syed's  south Orange County home, spread north in a series of random and deadly carjackings, and ended with his suicide in the city of Orange.

Syed was described as an unemployed man who was taking a class at Saddleback College. He had no criminal record and was living with his parents on Red Leaf Lane in Ladera Ranch, Amormino said.

PHOTOS: Shootings at multiple locations in O.C.

Deputies were called to their home about 4:45 a.m. after his parents reported a shooting, Amormino said. Responding deputies found a woman dead inside who had been shot multiple times.

The relationship between the woman and Syed was not yet known, Amormino said, although she was not related to the suspect. The woman has not yet been identified.

Family members, including children, were at the home at the time of the shooting, Amormino said, but no other injuries were reported.

MAP: Orange County shootings

Syed fled the area and headed toward Tustin, where Amormino said "multiple incidents" occurred.

The first, authorities said, occurred near Red Hill Avenue and the 5 Freeway, where authorities received a report of a man with a gun about 5:10 a.m. The suspect attempted a carjacking, Tustin police Lt. Paul Garaven said, opened fire and wounded a bystander.

About five minutes later, the suspect stopped the BMW near the 55 Freeway in Santa Ana, officials said.

TIMELINE: Deadliest U.S. mass shootings

Around that time, authorities also received reports about a man shooting at moving vehicles on the 55 Freeway. Officials believe the man fired either while driving or after he stopped and got out of his vehicle. At least three victims have reported minor injuries or damage to their cars, and investigators asked that others who believe they may have been fired upon to contact police.

Shortly after, another shooting and carjacking was reported on Edinger Avenue near the Micro Center computer store in Tustin, Garaven said. One person was killed and another was taken to a hospital.

Co-workers identified the men as plumbers who were working at the under-construction Fairfield Inn on Edinger Avenue.

Officers spotted the suspect in a stolen vehicle, followed him into the city of Orange and initiated a traffic stop near the intersection of East Katella Avenue and North Wanda Road, Garaven said.

The suspect then shot and killed himself, authorities said. A shotgun was recovered, but officials said other weapons might have been involved earlier. 

In Orange, financial planner Kenneth Caplin said he had a clear view of the gruesome drama that unfolded Tuesday on the street outside his office.

Although the street had been blocked, Caplin parked farther away and persuaded an officer to let him walk to his office. He arrived shortly before 7 a.m., about an hour after the shooting.

From a conference room window, Caplin saw the police investigators at work, a white work truck up on a curb, and the suspect lying dead on the ground, with blood streaked across the pavement.

"It's scary.... This just happened right here," Caplin said hours later, as a team in biohazard suits scrubbed away at the street in an afternoon drizzle. "It's ludicrous."

Caplin, 71, said he is a pistol instructor for the NRA. What happened Tuesday only affirmed for him the need to stay armed.

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SwiftKey 4 Offers Satisfying Swiping and Almost Perfect Predictions

SwiftKey 4 is one of the best gesture keyboard apps ever. It is so good at predicting what you type, it borders on being creepy. I can rattle off e-mails, tweets and text messages to friends about sports, movies, tech, music — and based on what I’ve typed, SwiftKey occasionally finishes sentences word by word.

It does this by collecting data on what is typed as it’s typed. The data is collected anonymously, feeding the app’s learning algorithm to predict what you’ll type next, based on what you’ve typed in the past. This means it does a scary-good job anticipating what you want to type. It’s not perfect, but it always offers suggestions, right above its keyboard. More often than not, I find those suggestions are spot-on. But the keyboard app’s prediction capabilities are just a part of the story.

SwiftKey 4, which officially hit Google Play on Wednesday, is a top-notch gesture keyboard app, replacing the stock keyboard on whatever version of Android you’re using. I’ve been using a beta version of the app for about three weeks and it’s among the first third-party keyboards I’ve actually enjoyed using.

My main handset is a Nexus 4. I use it daily and I’m a huge fan of its Android Jelly Bean keyboard, which has gesture typing built-in. On the Nexus 4’s stock keyboard, as you’re swiping along keys on-screen, Android does a solid job of predicting what word you’re typing. It’s so good in fact, that it makes going to an iPhone or iPad almost painful due to the lack of gesture typing in iOS. But SwiftKey 4 one-ups the Nexus’ keyboard by allowing you to type out entire sentences without having to lift your finger off the display between words.

As you’re swiping across your phone’s display, SwiftKey guesses what you’re typing. Those guesses change as you type more letters; when you see the word you want, just lift your finger. Or, keep swiping the letters of that word and then swipe down to the spacebar for a space, then start a new word — SwiftKey calls this feature Flow. If you’re not into gesture typing, simply type as normal. The app still throws out predictions.

Last year, SwiftKey’s app sat atop Google Play’s Top Paid Apps list for more than 20 weeks. It’s been installed by millions of people, and offers a keyboard for 60 different languages. Samsung used the company’s SDK to build SwiftKey Flow into the keyboard of its Galaxy S III and Note II smartphones, and its prediction technology is baked into the keyboards shipping on smartphones from a handful of Samsung’s competitors as well. If you’re already using SwiftKey, the upgrade to the 4th generation of the app is free. Otherwise, SwiftKey 4 is a $3.99 download. It’s not cheap, but it is worth it if you’ve got an Android and you’re into gesture typing.

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Well: No Consensus on Plantar Fasciitis

Phys Ed

Gretchen Reynolds on the science of fitness.

There are more charismatic-sounding sports injuries than plantar fasciitis, like tennis elbow, runner’s knee and turf toe. But there aren’t many that are more common. The condition, characterized by stabbing pain in the heel or arch, sidelines up to 10 percent of all runners, as well as countless soccer, baseball, football and basketball players, golfers, walkers and others from both the recreational and professional ranks. The Lakers star Kobe Bryant, the quarterback Eli Manning, the Olympic marathon runner Ryan Hall and the presidential candidate Mitt Romney all have been stricken.

But while plantar fasciitis is democratic in its epidemiology, its underlying cause remains surprisingly enigmatic. In fact, the mysteries of plantar fasciitis underscore how little is understood, medically, about overuse sports injuries in general and why, as a result, they remain so insidiously difficult to treat.

Experts do agree that plantar fasciitis is, essentially, an irritation of the plantar fascia, a long, skinny rope of tissue that runs along the bottom of the foot, attaching the heel bone to the toes and forming your foot’s arch. When that tissue becomes irritated, you develop pain deep within the heel. The pain is usually most pronounced first thing in the morning, since the fascia tightens while you sleep.

But scientific agreement about the condition and its causes ends about there.

For many years, “most of us who treat plantar fasciitis believed that it involved chronic inflammation” of the fascia, said Dr. Terrence M. Philbin, a board-certified orthopedic surgeon at the Orthopedic Foot and Ankle Center in Westerville, Ohio, who specializes in plantar fasciitis.

It was thought that by running or otherwise repetitively pounding their heels against the ground, people strained the plantar fascia, and the body responded with a complex cascade of inflammatory biochemical processes that resulted in extra blood and fluids flowing to the injury site, as well as enhanced pain sensitivity.

But instead of lasting only a few days and then fading, as acute inflammation usually does, the process can become chronic and create its own problems, causing tissue damage and continuing pain.

This progression is also what experts believed was happening when people developed chronic Achilles tendon pain, tennis elbow or other lingering, overuse injuries.

But when scientists actually biopsied fascia tissue from people with chronic plantar fasciitis, “they did not find much if any inflammation,” Dr. Philbin said. There were virtually none of the cellular markers that characterize that condition.

“Plantar fasciitis does not involve inflammatory cells,” said Dr. Karim Khan, a professor of family practice medicine at the University of British Columbia and editor of The British Journal of Sports Medicine, who has written extensively about overuse sports injuries.

Instead, plantar fasciitis more likely is caused by degeneration or weakening of the tissue. This process probably begins with small tears that occur during activity and that, in normal circumstances, the body simply repairs, strengthening the tissue as it does. That is the point of exercise training.

But sometimes, for unknown reasons, this ongoing tissue damage overwhelms the body’s capacity to respond. The small tears don’t heal. They accumulate. The tissue begins subtly to degenerate, even to shred. It hurts.

By and large, most sports medicine experts now believe that this is how we develop other overuse injuries, like tennis elbow or Achilles tendinopathy, which used to be called tendinitis. The suffix “itis” means inflammation. But since the injury isn’t thought to involve chronic inflammation, its name has changed.

This has not yet happened with plantar fasciitis, and may not, given what a mouthful fasciopathy would be.

The evolving medical opinions about plantar fasciitis matter, beyond nomenclature, though, because treatments depend on causes. At the moment, many physicians rely on injections of cortisone, a steroid that is both a pain reliever and anti-inflammatory, to treat plantar fasciitis. And cortisone shots do reduce the soreness. In a study published last year in BMJ, patients who received cortisone injections reported less heel pain after four months than those whose shots had contained a placebo saline solution.

But whether those benefits will last is unknown, especially if plantar fasciitis is, indeed, degenerative. In studies with people suffering from tennis elbow, another injury that is now considered degenerative, cortisone shots actually slowed tissue healing.

We need similar studies in people with plantar fasciitis, Dr. Khan said. “They have not been done.”

Thankfully, most people who develop plantar fasciitis will recover within a few months without injections or other invasive treatments, Dr. Philbin said, if they simply back off their running mileage somewhat or otherwise rest the foot and stretch the affected tissues. Stretching the plantar fascia, as well as the Achilles tendon, which also attaches to the heel bone, and the hamstring muscles seems to result in less strain on the fascia during activity, meaning less ongoing trauma and, eventually, time for the body to catch up with repairs.

To ensure that you are stretching correctly, Dr. Philbin suggests consulting a physical therapist, after, of course, visiting a sports medicine doctor for a diagnosis. Not all heel or arch pain is plantar fasciitis. And comfort yourself if you do have the condition with the knowledge that Kobe Bryant, Eli Manning and Ryan Hall have all returned to competition and Mr. Romney still runs.

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Honda to Offer Customers a Home Solar System Option

Automakers have long resorted to incentives like zero-percent financing, rewards points and rebates to inspire customer loyalty. Now Honda is offering a different deal: inexpensive home solar power systems for customers.

Through a partnership with SolarCity, a residential and commercial installer, Honda and Acura will offer their customers home solar systems at little or no upfront cost, the companies said on Tuesday. The automaker will also offer its dealers preferential terms to lease or buy systems from SolarCity on a case-by-case basis, executives said.

The deal, in which Honda will provide financing for $65 million worth of installations, will help the automaker promote its environmental aims and earn a modest return, executives said. It could also open the door for more corporate investment in solar leasing companies, which has largely been limited to a small cluster of banks to provide capital for their projects.

And SolarCity, one of the few clean-tech start-ups to find a market for an initial public offering of its stock last year, will potentially gain access to tens of millions of new customers through Honda’s vast lists of current and previous owners.

“When we partner with financial institutions, they aren’t promoting us to their customers, they’re essentially just providing us with capital,” said Lyndon R. Rive, SolarCity’s chief executive. But with Honda, he said, the company is gaining, “access to a broader customer base, and a customer base that is conscious of the environment.”

Whether the marriage will prove successful remains to be seen. “I don’t think that by finding Honda buyers you’ve homed in on the perfect solar customer, but there’s enough overlapping between the demographics that you’re better off than the general population,” said Shayle Kann, vice president at GTM Research, adding that car buyers were more likely to own their homes and have the income and credit history to qualify for solar leasing. While the American solar industry in general has been struggling in the face of declining government subsidies, overcapacity in production and a glut of inexpensive Chinese panels, interest and investment in solar leasing, or third-party ownership, has continued to grow. According to a recent report from GTM Research, a renewable energy consulting firm that is a unit of Greentech Media, third-party ownership accounts for more than 70 percent of all residential installations in developed markets like Arizona, California and Colorado and has generated at least $3.4 billion in private investment since 2008.

SolarCity and a rival, Sunrun, were among pioneers of the approach, but players like Clean Power Finance and Vivint, a home security company owned by the Blackstone Group, are also gaining momentum.

In a typical arrangement, a company provides a system at little or no cost in exchange for a long-term contract in which the customer pays a fixed fee for the electricity generated, set at less than the customer would pay for power from the local utility. The solar price often rises over the life of the agreement, which can last 20 years.

Honda approached SolarCity more than a year ago when it was looking for a partner to provide solar installation services for its hybrid and electric vehicle customers, said Ryan Harty, American Honda’s assistant manager for environmental business development. The company then decided to expand to all its customers — a group it is defining “very, very broadly,” Mr. Harty said, to include not just car owners but also those who have explored its Web sites. The offer will be available in 14 states: Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Maryland, Massachusetts, New York, New Jersey, Oregon, Pennsylvania, Texas and Washington, and the District of Columbia.

The two companies say they hope the joint venture leads to projects that integrate solar power and electric vehicle recharging for its customers.

The program will give Honda and Acura customers an extra $400 discount on top of SolarCity’s normal promotions, which they can use to sweeten the terms of the solar contract, like eliminating the escalation of the monthly payment. Honda projects the fund can finance as many as 3,000 systems on homes and 20 for its dealers. If the program catches on, Honda plans to expand it. Executives said they saw more immediate promise in cutting carbon emissions through solar power than the electric vehicles it would sell.

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Tucson arrests unleash anger over Arizona immigration law

TUCSON — It's routine for immigration officials in Arizona to detain people suspected of being in the country illegally.

Monday, however, the detention of two men — an immigrant rights activist and a father of six in Tucson — sparked protests, frustrated local authorities and illustrated the difficulties of complying with SB 1070, the state's controversial immigration enforcement law.

"This is unjust," Alma Hernandez yelled in Spanish to a crowd of about 300 that gathered in front of the Tucson Police Department to protest the detentions. Hernandez, a spokeswoman with the civil rights organization Corazón de Tucson, riled up the crowd by introducing immigrant rights activist Raul Alcaraz Ochoa, who had just been released from immigration detention.

"We need to fight for all those who are detained," Alcaraz Ochoa said.

Immigration officials arrested him Sunday after he positioned himself underneath a U.S. Customs and Border Patrol vehicle in an attempt to stop officials from taking away another man, Rene Meza.

The incident began Sunday afternoon after someone called Tucson police expressing concern for the safety of children in a silver Mercury Cougar, Lt. Fabian Pacheco said.

Officers discovered five children in the vehicle, along with Meza and his girlfriend, Perla Lopez. Four of the children were younger than 5 and were not in proper safety restraints as required by law, Pacheco said.

Meza had a Mexican voter registration card but no valid U.S. driver's license, Pacheco said. Police arrested Meza and called immigration officials after federal records revealed he had prior contact with them.

Meza was charged with being in the country illegally after a previous deportation, Customs and Border Protection spokesman Victor Brabble said. Meza is scheduled to go before an immigration judge Tuesday.

Under SB 1070, Arizona law enforcement officials are compelled in most circumstances to check the status of someone they stop for lawful reasons if they suspect the person is in the country illegally.

Pacheco said the officers were simply enforcing the law.

"The department is stuck in the middle," Pacheco said. "Our discretion is gone."

Soon after Tucson police flagged immigration officials, Border Patrol officers drove up.

Alcaraz Ochoa, who was on his way to a community meeting, saw what was happening and approached the officials.

"They took the father, and the children were crying and asking for their father," Alcaraz Ochoa said.

Alcaraz Ochoa, a legal permanent resident and prominent immigrant rights activist best known for participating in a sit-in at Republican Sen. John McCain's office in 2010, said he began to question the officials. Dissatisfied with their answers, he crawled underneath the Border Patrol vehicle.

He said Border Patrol officials pepper-sprayed him, removed him from beneath the vehicle and handcuffed him.

Brabble said Border Patrol agents arrested Alcaraz Ochoa after he failed to respond to repeated warnings and refused to move from beneath the vehicle.

Meza may also face state charges of driving with a suspended license and of not having the children in proper restraints. Lopez, a U.S. citizen, was not detained.

Lopez's mother, Lydia Lopez, said the children weren't restrained properly because the family had just bought the vehicle from a private owner moments earlier and didn't have the safety seats with them. She said the punishment is too extreme.

"It's not justified," Lopez said in Spanish.

cindy.carcamo@latimes.com

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History alive and kicking at 2013 Oscars

LOS ANGELES (Reuters) – History is alive and kicking at this year’s Oscars in an unusually rich year for movies that plumb the distant and recent American past and have resonated with both audiences and voters.

Four of the nine Best Picture nominees at Sunday’s Academy Awards ceremony – Iran hostage drama “Argo,” Osama bin Laden thriller “Zero Dark Thirty,” slavery revenge fantasy “Django Unchained” and U.S. presidential drama “Lincoln” – are the most discussed films of the awards season, with their very different takes on historical events.

“It’s an interesting year for thought-provoking movies that have a semblance of reality. Some look to where we come from and where we are going, and they get people thinking,” said Pete Hammond, awards columnist for entertainment industry website Deadline.com.

It’s a sharp contrast with 2012 when the silent film comedy “The Artist” was embraced by the 6,000 members of the Academy of Motion Picture Arts and Sciences as a love letter to old Hollywood.

This time, terrorism, slavery, war, politics and the CIA take center stage in films that try to make sense of calamitous times for the United States and draw lessons for the future.

POLITICAL DEADLOCK

“Lincoln,” Steven Spielberg’s account of President Abraham Lincoln‘s drive to persuade a divided Congress to abolish slavery in 1865, has spoken loudly to present day Americans faced with daily evidence of political deadlock in Washington.

“The movie emphasizes the theme of how difficult it is to get anything done in a democratic republic like ours, and how it requires wheeling and dealing and negotiating,” said Robert Thompson, professor of popular culture at Syracuse University.

“The idea of taking these very modern problems and seeing them positioned in this noble historical past has been one that, in an odd way, is very comforting,” Thompson added.

Not so comforting is “Django Unchained,” director Quentin Tarantino’s blood-soaked but audacious take on 19th century slavery, filmed in darkly humorous spaghetti Western style.

Spike Lee, one of the nation’s most respected black filmmakers, called “Django” disrespectful to his ancestors and vowed not to see it.

“American slavery was not a Sergio Leone spaghetti Western. It was a holocaust,” Lee said in a Twitter message in December.

Although the film has divided the African-American community, it has taken an impressive $ 154 million at the North American box office alone, received five Oscar nods, and sparked new debates about the brutal era of slavery.

No movie has split Americans more this season than “Zero Dark Thirty,” which was released less than two years after the May 2011 killing of al Qaeda leader bin Laden by U.S. Navy SEALS.

Attacked by politicians and some activist groups for its portrayal of torture in the decade-long hunt for bin Laden, the film is being promoted in Oscar campaigns as “the most talked-about movie of the year.”

CHALLENGES NOT ANSWERS

“Zero Dark Thirty” screenwriter Mark Boal said the film is intended to challenge Americans to ask questions. “It’s a story about our time, and our nation, and our role in the world,” Boal said in a speech at Loyola Marymount University in Los Angeles this month. “It contributes to public dialogue about our government and its actions.”

It’s also a film that, for better or worse, may stand for years as the definitive version of the bin Laden mission.

“We watched all the news coverage of the killing of Osama bin Laden. But we did not have those front row seats and a movie is much more memorable than the president of the United States standing by the podium and describing it,” said Thompson

“Until another Osama bin Laden movie is made, ‘Zero Dark Thirty’ is probably going to be one of the dominant ways in which that event is remembered.”

“Argo” director Ben Affleck sees his movie as “eerily current,” despite being set more than 30 years ago. Based on a real CIA mission soon after the 1979 Islamic Revolution, it recounts the rescue of six U.S. diplomats from the Canadian embassy in Tehran using an unlikely Hollywood movie cover story.

Noting the unrelenting political tensions between the United States and Iran, Affleck told reporters in January: “I think we are feeling a bit frustrated as a country, and this was a time when the CIA and the Canadians went out and got something right.”

All four films have been accused of taking liberties with historical accuracy. But pop culture expert Thompson said movies shouldn’t be judged like journalism or history books.

“The great thing about art is that it turns data into a valuable experience. We want art to be working on this material,” he said.

Dave Karger, chief correspondent for Fandango.com, said the Academy has always gravitated toward stories drawn from real life.

“I don’t think it’s a conscious choice, but I do think there is something appealing to most Academy voters in these quintessential American stories,” Karger told Reuters.

The Oscar Best Picture nominees are rounded out by musical “Les Miserables,” shipwreck tale “Life of Pi,” French-language drama “Amour,” mythological indie film “Beasts of the Southern Wild” and quirky comedy “Silver Linings Playbook.”

(Editing by Christopher Wilson)

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National Briefing | South: Abortion Curbs Clear Senate in Arkansas

The State Senate voted 25 to 7 on Monday to ban most abortions 20 weeks into a pregnancy. The measure goes back to the House to consider an amendment that added exceptions for rape and incest. The legislation is based on the belief that fetuses can feel pain 20 weeks into a pregnancy, and is similar to bans in several other states. Opponents say it would require mothers to deliver babies with fatal conditions. Gov. Mike Beebe has said he has constitutional concerns about the proposal but has not said whether he will veto it.

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DealBook: Morgan Stanley Strives to Coordinate 2 Departments Often at Odds

Several hundred Morgan Stanley retail branch managers descended on the JW Marriott Orlando Grande Lakes resort in Florida early this month for a retreat. They were greeted by an unlikely colleague, Colm Kelleher, who runs the company’s sales and trading and investment banking departments.

Traditionally, traders and investment bankers think of themselves as the elite of Wall Street and look down on the retail business, seeing it as pedestrian. Yet Mr. Kelleher had a message for the branch managers: His group can work with retail brokers to increase profits at Morgan Stanley.

That message evokes the strategic emphasis that followed the 1997 merger of Morgan Stanley with Dean Witter, Discover & Company. The rationale for that deal was to create a financial supermarket where the retail brokerage and the investment banking businesses could complement each other.

But the company’s swaggering traders wanted little to do with the financial advisers, creating tension and turmoil that would lead to upheaval at the top.

The company over the years has set up revenue sharing agreements between bankers and traders. But that, too, created strife, with bankers and traders accusing each other of deliberating misstating revenue to avoid splitting fees, which some traders called the investment banker tax.

“Morgan Stanley has a horrible history of getting these groups to work together,” said Richard Bove, an analyst with Rafferty Capital Markets.

Yet since Morgan Stanley moved to acquire control of the Smith Barney brokerage business from Citigroup in 2009, the balance of power has shifted to wealth management, which now accounts for almost 52 percent of the company’s earnings, up from roughly 16 percent in 2006.

Gregory J. Fleming, the chief of the brokerage business, and Mr. Kelleher have been under pressure from shareholders to coax greater profits from the low-margin brokerage business by finding ways for retail and investment banking to work better together. The two men are said to have a good working relationship, leading to renewed optimism that the company can finally find synergies among its various divisions.

That is a change from a few months ago, when cooperation was difficult, according to employees at the company, because of personality conflicts between Mr. Kelleher and the investment banker Paul Taubman, who were the two co-heads of the institutional securities business. The employees spoke on the condition of anonymity because of the policy against speaking to the news media without permission.

Mr. Taubman departed recently after a power struggle, leaving Mr. Kelleher solely in charge of sales and trading, and investment banking.

In recent months, the company has made changes intended to improve communication among divisions. Last fall, Morgan Stanley transferred Eric Benedict, an ally of Mr. Kelleher, to wealth management to run its capital markets operation. Previously Mr. Benedict worked for Mr. Kelleher on the equity syndicate desk.

A few months after Mr. Benedict moved to wealth management, the company created a bond, or fixed income, sales group to focus on middle-market clients. The company then transferred some of its smaller banking clients into wealth management to give them more attention. The fixed-income division will share revenue from this middle-market unit with wealth management.

James P. Gorman, the chief executive of Morgan Stanley, is hoping that its sales and trading unit will work more closely with wealth management to increase lending, better tailor structured products for retail clients and improve collaboration on events like public offerings, company insiders said.

For instance, Morgan Stanley may take a company public and the executives at that company may need advice managing their personal wealth. In such an instance, the bankers would alert wealth management, which could dispatch a broker to assess the situation.

In January, on a call with investors to discuss the company’s fourth-quarter results, Mr. Gorman said 35 projects were under way to encourage collaboration between these businesses. One focus is how to increase lending to the firm’s corporate and individual clients.

A lot is riding on Mr. Gorman’s strategy. Morgan Stanley, which for years was best known for its high-flying trading operations and investment bank, was badly bruised in the financial crisis. Since then regulators have established rules that require banks to post more capital against riskier operations, compelling Morgan Stanley to scale back or get out of certain businesses. Morgan Stanley has shrunk its fixed income department, where most of its risk taking was embedded.

But, if Mr. Gorman can make it work, Mr. Bove predicted the chief could return Morgan Stanley to its former glory, “albeit in a different form.” Mr. Bove has a buy rating on Morgan Stanley.

Morgan Stanley emerged from the financial crisis safer, but less profitable. In 2012 it posted a return on equity (excluding a charge related to its debt) of 5 percent. Return on equity is an important measure of how effectively shareholder money is being deployed. Goldman posted a return on equity for the same period of 10.7 percent. To simply cover its debt expenses and other capital costs, Morgan Stanley must achieve a return on equity closer to 10 percent.

Investors also focused on another number, from Morgan Stanley’s wealth management unit. That division posted a pretax profit margin of 17 percent in the fourth quarter of 2012, exceeding most analysts’ expectations.

The number was higher than expected, according to people briefed on the matter but not authorized to speak on the record, because the company deferred from the fourth quarter some major costs like compensation for certain executives.

As a result, some analysts and rivals are wondering how sustainable that level is. Morgan Stanley insiders say while some one-time items did help increase that number, it wasn’t significant and they expect Mr. Fleming to produce a lower but still high pretax profit margin for the current quarter.

“Although the first-quarter margin is seasonally lower, we believe that we can drive margins to the high teens and above over time even with only with modest revenue growth and a low interest rate environment,” said Ruth Porat, chief financial officer at Morgan Stanley, on a conference call last week with fixed-income investors.

For that number to rise significantly, Mr. Fleming must make some of recent initiatives work, analysts say.

“Everyone is watching that number,” said an executive at a rival firm who was not authorized to speak on the record. “If they can increase, it will be a sign Gorman’s strategy is working, but so far not everyone is convinced.”

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Seawater desalination plant might be just a drop in the bucket

CARLSBAD, Calif. — Dreamers have long looked to the Pacific Ocean as the ultimate answer to California's water needs: an inexhaustible, drought-proof reservoir in the state's backyard. In the last decade, proposals for about 20 desalting plants have been discussed up and down the coast.

But even with construction about to begin on the nation's largest seawater desalination facility, 35 miles north of San Diego, experts say it is doubtful that dream will ever be fully realized.

"While this Poseidon adventure may work out, I don't look for a lot of that," said Henry Vaux Jr., a UC Berkeley professor emeritus of resource economics who contributed to a 2008 National Research Council report on desalination.

The reasons boil down to money and energy. It takes a lot of both to turn ocean water into drinking water, driving the average price of desalinated supplies well above most other sources.

The purified water produced by the Poseidon Resources plant will cost the San Diego County Water Authority more than twice what it now pays the Metropolitan Water District of Southern California for supplies from Northern California and the Colorado River. Over the authority's 30-year contract with Poseidon, San Diego County ratepayers will pay between $3 billion and $4 billion for the desalted water, which is expected to provide no more than a tenth of their overall supply.

Seawater desalination is not new to California. There are number of small coastal plants, used mostly for research or industrial purposes, and a few, such as one on Catalina Island, that provide municipal supplies.

For reasons unique to the region, San Diego County will be the first to stick a big straw into the Pacific. It is at the end of the line for imported water, doesn't have much local groundwater and is perennially battling with Metropolitan, Southern California's wholesaler of imported supplies.

"I do believe it is worth it," said Tom Wornham, board chairman of the county water authority. "I would rather be apologizing to people in 10 years for the rate than the fact they would have no water."

Up the coast, other places have taken a pass on the Pacific. Los Angeles and Long Beach recently shelved seawater desalting plans after concluding that other water sources, such as conservation or recycling, are cheaper and easier to pursue.

Poseidon, a small, privately held company based in Stamford, Conn., started talking about developing a desalination plant in Carlsbad in late 1998. The road to construction has been so long and twisting that Global Water Intelligence, which covers the international water industry, last year listed the project among the "Top 10 Desalination Disasters" of all time.

It took years for the company to get the necessary state and local permits. Environmentalists filed multiple legal challenges, the last of which was only recently resolved in Poseidon's favor. A deal with a number of local water agencies in San Diego County fell apart.

In the end, the Poseidon supplies — up to 56,000 acre-feet a year — will sell for roughly $2,000 an acre-foot, more than double the company's 2004 estimate. (One acre-foot is enough to supply two average homes for a year.) The price will rise with inflation; if energy costs go up, so will the price of water.

On the other side of the Pacific, Australia offers a sobering lesson in the perils of diving too deeply into desalination.

When years of withering drought emptied the country's reservoirs, Australia commissioned six big coastal desalting plants, including some of the world's largest. Then the rains returned. Just as some of the operations were coming on line, they were no longer needed.

Four of the six plants are being idled because cheaper water is available. Australian politicians are bemoaning the desalination binge, complaining that it saddled ratepayers with "hyper-expensive" white elephants they have to pay for regardless of whether the plants are used.

"That's certainly the risk — that we build them when they're not necessary or we build them, frankly, too soon," said Heather Cooley of the Pacific Institute, an Oakland think tank.

Santa Barbara had a similar experience in the early 1990s, when it built a desalination plant during a severe statewide drought that ended before the facility was finished. The $34-million plant, with a tenth of the capacity of the Carlsbad facility, was never used beyond the testing phase, though it could still be brought into service in an emergency.

The $954-million Carlsbad project is being financed with $781 million in tax-exempt construction bonds sold by Poseidon and the water authority. The balance is coming from investors who anticipate a return of about 13%. IDE Americas Inc., the subsidiary of an Israeli firm that runs some of the world's largest coastal desalination facilities in the Middle East, has been hired to design and operate the plant, slated for completion in 2016.

The fresh water will be produced through reverse osmosis, an energy-intensive process that separates salts and contaminants from seawater by forcing it through sand filters and tightly coiled, synthetic membranes peppered with billions of tiny holes a fraction of the width of a human hair. The water will then be pumped inland for distribution — the opposite direction that drinking supplies are usually moved — requiring construction of a 10-mile underground pipeline that the water authority will own and operate.

Poseidon chose the Carlsbad location, next to the Encina Power Station, so it could draw from the power plant's cooling water discharge — thus avoiding the environmental harm of operating its own ocean intake.

But new federal and state environmental regulations are pushing coastal power plants to phase out the use of huge volumes of ocean water for cooling, thwarting that strategy. Poseidon expects the Encina station to be replaced within the decade with a new generating facility employing a different cooling system.

That will mean the desalter will have to pump directly from the ocean, sucking 300 million gallons a day. Of that, 100 million gallons will go through the reverse osmosis process, with half converted to fresh water and half to a concentrated brine. The brine, twice as salty as the sea, will be diluted in a mixing pool with the other 200 million gallons of intake and discharged to the ocean.

Destruction of marine life is a major environmental concern of ocean desalination. Raw seawater is full of tiny organisms, including plankton that form a critical part of the food chain and the young stages of fish and invertebrates. When the water they live in is pumped into a plant, they die.

The Coastal Commission is requiring Poseidon to restore 55 acres of marine wetlands in south San Diego Bay to compensate for the plant's projected effects. The State Water Resources Control Board is also developing new seawater desalination regulations that could force Poseidon to change its intake and discharge systems.

"They took a big risk in building this before the rules are finalized," said Joe Geever of the Surfrider Foundation, which tenaciously fought the Carlsbad proposal in court and argues that water agencies should turn to the ocean only as a last resort — after more environmentally benign sources such as recycling and storm-water capture have been aggressively pursued.

Poseidon, which is trying to line up customers for a similar-size desal plant proposed in Huntington Beach, says it is peddling more than water. "What we're selling is ... a reliability premium that's locally controlled, drought-proof," said Carlos Riva, the company's chief executive.

But even Poseidon doesn't predict that the Pacific will become California's dominant water supply. The state has too many other sources.

"We have quite a bit of water to move around," said Peter MacLaggan, the Poseidon executive who is overseeing the Carlsbad project. "I don't think it's ever going to be a majority of supply or anywhere close to that."

bettina.boxall@latimes.com

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<cite>Halo</cite> Creator Unveils Its Next Masterpiece, a Persistent Online World

"Citadel": Concept art from Bungie's Destiny.

BELLEVUE, Washington — Destiny, the new game from the creator of Halo, isn’t just another shooter. It’s a persistent online multiplayer adventure, designed on a galactic scale, that wants to become your new life.

“It isn’t a game,” went the oft-heard tagline at a preview event on Wednesday. “It’s a world where the most important stories are told by the players, not written by the developers.”

This week, Bungie Studios invited the press into its Seattle-area studio to get the first look at Destiny. Although the event was a little short on details — Bungie and Activision didn’t reveal the launch date, handed out concept art instead of screenshots, and dodged most of my questions — it gave an intriguing glimpse at what the creator of Halo believes is the future of shooters.

Bungie was acquired by Microsoft in 2000, and its insanely popular shooter was the killer app that put the original Xbox on the map. Bungie split off from its corporate parent in 2007, and Microsoft produced Halo 4 on its own last year. The development studio partnered up with mega-publisher Activision for its latest project, which was kept mostly secret until now.

Destiny, slated for release on PlayStation 3 and Xbox 360, isn’t exactly an MMO. Activision CEO Eric Hirshberg called it a “shared-world shooter” — multiplayer and online, but something less than massive.

“We’re not doing this just because we have the tech,” Hirshberg said. “We have a great idea, and we’re letting the concept lead the tech.”

Built with new development software created specifically for Destiny, this new game is set in Earth’s solar system and takes place after a mysterious cataclysm wipes out most of humanity. The remaining survivors create a “safe zone” underneath a mysterious alien sphere called “The Traveler.”

The enigmatic sphere imparts players with potent weapons, magic-like powers and defensive technology. Thanks to these gifts, people have begun reclaiming the solar system from alien invaders that moved in while humanity was down.

Bungie fired off a list of design principles that guide Destiny’s creation: Create a world players want to be in. Make it enjoyable by players of all skill levels. Make it enjoyable by people who are “tired, impatient and distracted.” In other words, you don’t have to be loaded for bear and pumped for the firefight of your life every time you log on to Destiny.

After this brief overview, writer/director Joseph Staten used concept art and narration to outline an example of what a typical Destiny player’s experience might be.

Beginning in the “safe zone,” a player would start out from their in-game home and walk into a large common area. From here, the player would be able to explore their surroundings and meet up with friends. Then, they might board their starships and fly to another planet, let’s say Mars, in order to raid territory held by aliens.

During this raid, other real players who traveled to the same zone (like visiting a particular server on an MMO) would be free to come and go as they please. For example, a random participant could simply walk on by. They could stop and observe. Or they could get involved in the fight. In this instance, Staten suggested that a passerby would join the raid and then break off from the group after the spoils were divvied up without any user interface elements to fuss with. Walk away, and it’s done.

Bungie made a point of saying several times over that Destiny will not have any “lobby”-type interfaces, or menus from which to choose from a list of quests. Instead, players will simply immerse themselves in the world and organically choose to participate in whatever activities they stumble upon. Bungie promised solo content, cooperative content, and competitive content, though it provided no further examples of these.

The developer said that by employing very specialized artificial intelligence working entirely behind the scenes, players will encounter other real players who are best suited for them to interact with, based on their experience levels and other factors.

Staten didn’t say how many players would be able to exist in the world at the same time, but said that characters will be placed in proximity to each other based on very specific criteria, not simply to “fill the world up.”

Bungie showed off three distinct character classes throughout the day’s presentations: Hunter, Titan and Warlock. Although no differences were outlined between them apart from the Warlock being able to use a kind of techno-magic, the developer was keen to emphasize the idea that each character in Destiny would be highly customized and unique, and will grow with the player over an extended period of time.

While many games make the same promise, Destiny’s vision of “an extended period of time” isn’t 100 hours. It’s more like 10 years.

Bungie’s plan is for the Destiny story to unfold gradually over the course of 10 “books,” each with a beginning, middle and end. Through this will run an overarching story intended to span the entire decade’s worth of games, although like many other topics covered during the day, Bungie gave little detail about how this will work.

The developer spent a lot of time emphasizing its claim that no game has been made at this scale before. Bungie says it has a whopping 350 in-house developers working on Destiny.

Senior graphics architect Hao Chen gave examples of the sort of impenetrable mathematics formulas that allow Bungie to craft environments and worlds at a speed that it claims was previously impossible.

Bungie’s malleable team system was also said to increase its output. With the ability to co-locate designers, artists, and engineers at any time, Bungie says it can go through exceptionally rapid on-the-spot iteration and improvement for each facet of the game.

Apart from highly improved technology and the basic concept of humanity taking back the solar system, there’s just not a lot of hard information on Destiny at the moment. One thing that was made quite clear is that the game will not be subscription-based. Every presenter was clear in stating that players will not pay a monthly fee to participate in this persistent world.

While fees may not be required, a constant connection to the Internet will be. Since the core concept of Destiny is exploring a world that exists outside of the player’s console and is populated by real people at all times, it “will need to be connected in order for someone to play,” said Bungie chief operating officer Pete Parsons.

Representatives from both Bungie and Activision gave vague answers when Wired pressed for further details, often stating that they “were not ready” to discuss specifics. Whether that means those things are still being kept from the press, or whether they have not yet been determined by the development team, was unclear.

Questions currently unanswered: How will players communicate? How will players interact with each other outside of combat? What content exists in the non-combat “safe zones”? Subscriptions may be out, but what about in-app purchases? Will player versus player combat be available? Will the game ship on a disc or be download only? Will its persistent world allow Xbox and PlayStation gamers to play together? What content and interactions will be possible via smartphones and tablets (which Bungie alluded to)? Will the fancy new tools be licensed to other developers?

And so on.

For now, Bungie is asking us to take it for granted that it will execute on a bold 10-year plan for a very different sort of shooter. In the history of the always-changing gaming industry, no one’s ever been able to pull off a 10-year plan for anything. Can Bungie do it?

Hey… they made Halo, right?

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