When venture capitalists scale back investing activities it can be very swift and leave many companies that are in the process of fund raising hung out to dry. Just ask anybody who was trying to close funding the fateful week of September 11, 2001 or even March 2000. I would argue that the shut-down of September 2008 was equally severe yet there are signs that this “VC Ice Age” has begun to thaw.

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Facebook CEO Mark Zuckerberg will take to Oprah Winfrey’s couch today. What to expect? Questions about the economy? Mark’s not-so-secret Twitter account? The latest redesign?

Here’s what we’re hearing: Oprah and three guests–Oprah’s best friend Gayle King, actress Ali Wentworth and actor Mark Consuelos–will interview Mark and show a demo of the show’s new page on Facebook. A celebrity Facebook addict might Skype in to talk up the service as well, although that’s still a little TBD.

Another thing likely to be on the agenda: those nitpicky Facebook etiquette questions and some user stories to back them up.

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Now that President Obama has signed the $787 billion economic stimulus package into law, the real hard work begins: using that money to create jobs. If spent wisely, this package has a chance at fundamentally reforming the U.S. health-care system, making our economy energy efficient and providing Americans with the training and skills required to succeed in a 21st century global marketplace.

But the country can’t accomplish these goals unless it has the infrastructure to support them. That’s why the funding for broadband was so vital. Broadband is the ticket for entry to participate in the world economy. It is a fundamental technology upon which other things are built. It enables collaboration, innovation and operational excellence, and positions the U.S. to compete on a global basis.

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The competitive edge of the United States economy has eroded sharply over the last decade, according to a new study by a nonpartisan research group.

The report by the Information Technology and Innovation Foundation found that the United States ranked sixth among 40 countries and regions, based on 16 indicators of innovation and competitiveness. They included venture capital investment, scientific researchers, spending on research and educational achievement.

But the American economy placed last in terms of progress made over the last decade. “The trend is very troubling,” said Robert D. Atkinson, president of the foundation.

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Adobe (ADBE) shares are trading lower this morning after RBC Capital analyst Robert Breza trimmed his estimates and price target on the stock, noting that the upgrade cycle for the recently released Creative Suite 4 has been slowed by the weak economy.

“Our current checks indicate that Adobe’s end markets of enterprises, knowledge workers, designers, OEM partners and developers remain under pressure worldwide,” he writes. “Customers remain reluctant to part with cash and engage in education programs to upgrade to the newly released CS4.” He adds that checks with distribution partners find “a tough business climate” in the company’s fiscal first quarter ending this month. He says that it looks like more customers will skip the new version of Creative Suite and wait for version 5, due in a year or so.

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There was a time when the geeks who keep a company’s tech systems running could get by without knowing the finer details of corporate strategy. You called the chief information officer when you needed a server upgrade, not a strategic plan.

Well, those days are over.

This downturn could mean the end of the sequestered CIO–that rumpled executive who, like Scotty on “Star Trek,” has limited social skills and usually emerges from the engine room only when something blows up. In these tough times, CEOs are frequently calling tech chiefs out of the wiring closet and into the boardroom, and putting their business skills to the test.

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The outlook for consumer spending over the next 90 days looks “grim,” according to ChangeWave Research.

The firm said a survey of 2,701 U.S. consumers taken in the February 2-9 period found “the worst spending outlook ever recorded in a ChangeWave survey.”

According to the survey, 61 percent of the respondents expect to spend less money over the next 90 days compared to the same period last year. That compares with 12 percent who say they will spend more.

Of the survey group, 64 percent say the direction of the U.S. economy will worsen over the net 90 days; only eight percent expect the economy to improve. Asked about their feelings on the stock market, 42 percent say they are less confident than they were 90 days ago, compared to 14 percent who said they are more confident.

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Burlingame, Calif.–Wednesday would be a really bad day for Hewlett-Packard Chief Executive Mark Hurd to break his winning streak. Central bankers around the globe are sweatily trying to revive faltering banks. Politicians are passing stimulus packages. Consumers are seeing the values of their homes tank.

Luckily, Hewlett-Packard (HPQ) has a man at the top now who could be called Maalox in human form. Over the past four years, Hurd has reshaped a company once known for its manic earnings swings into a steady-earning powerhouse and the world’s largest information technology provider. BernsteinResearch notes that HP has met or beaten the guidance Hurd has laid down for the company’s performance, and then guided earnings-per-share expectations up, every quarter since he became HP’s chief in 2005.

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When the economy goes south, one name invariably surfaces on the lips of pundits and economists: John Maynard Keynes. That is because the twentieth century’s greatest economist is generally associated with the idea that markets require government intervention in order to function properly. During boom times, when the market seems to be working, no one has any use for Keynes’s skepticism toward unrestrained capitalism. But, during recessions–when the economy grinds to a halt and Washington suddenly looks like the only thing that can save it–Keynes invariably enjoys a revival. The current economic crisis, our country’s worst since the Great Depression, is no exception. Everyone, it seems, has spent the past months rediscovering Keynes.

But the tendency only to turn to Keynes for technical advice in bad times doesn’t really do justice to his worldview. Keynes’s ideas were not just a prescription for an ailing economy; they were a complete theory of capitalism, one meant to be relevant in both good times and bad. They were also more than just an economic program; his ideas about capitalism–spelled out most thoroughly in his 1936 work, The General Theory of Employment, Interest, and Money–were developed in tandem with his political philosophy. Keynes saw each as bound up with the other. “The most pressing reforms which are economically sound do not, as perhaps they did in earlier days, point away from the ideal,” Keynes wrote in 1932. “On the contrary, they point toward it.” Keynes, in other words, was interested in more than manipulating the levers of policy to keep economies thriving. He was interested in how economics intersects with political questions of equality and fairness and justice.

This fall, the Bush administration and the incoming Obama administration have had to confront not just narrow technical questions about budget deficits, interest rates, tax cuts, and savings, but also broader political questions about the proper relationship between government and the economy. Without our realizing or anticipating it, the entire panoply of concerns that Keynes faced in the 1930s has come back to us. Turning to him for answers is therefore an understandable, and wise, move–but only if we treat his ideas as what they are: not quick-fix steps for a battered market but long-term principles for creating a functional and just economy.

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Cisco (CSCO) CEO John Chambers just might be one the most careful executives in the Valley about talking to the press; in a brief chat with Tech Trader Daily at a media reception last night, he didn’t give away much about his views on the state of the economy or the current quarter. But he did have a few things to say. Here’s a summary.

• On the state of the economy: “I’m going to pass on the economy question,” he said. But he did say that in the current environment, “companies with cash are king, queen and the royal family.” Cisco has close to $27 billion in cash and short-term investments, and the total continues to climb.
• On acquisitions: Chambers says Cisco is always aggressive in making acquisitions during downturns. He says the best time to make acquisitions is during downturns.

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Omniture (OMTR) shares are down sharply today following cautious comments on the stock this morning by Pacific Crest analyst Chad Bartley.

Bartley writes that “feedback from the channel is markedly more negative” than it was two to three months ago. He says the poor economy is resulting in month-over-month slowing in the online business analytics sector; he says Q4 activity is weaker than expected in what is normally a seasonally strong period. “In general, existing customers are not expected to increase their investments in 2009,” he writes. Bartley also says new customer growth is slowing; he expects a drop of 30-50 percent in 2009 in new customer additions.

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Electronic Arts (ERTS) shares are being pounded today following the company’s guide-down for its March 2009 fiscal year. The stock was downgraded by, well, almost every analyst who follows it, which of course doesn’t help anyone who owned the stock as of yesterday’s close. The general consensus is that EA has simply been producing games that not many people want to buy; there is a fair amount of cheering from the sidelines about how this is not an industry problem, and demand for videogames overall remains just fine. But the skeptics think this is not entirely right, that however bad the current EA lineup is, there are additional pressures coming from the weakening economy, with retailers cutting inventory in the face of tighter credit conditions.

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Think long term. Long, long term. In the short term, there will be pain in Silicon Valley. Start-ups will have to survive 2009. Layoffs will be in fashion: “You didn’t do a layoff? What’s wrong with you?” Venture capitalists will be hit just as hard. Their investors–the endowments, the pension funds and others–are hurting. The entire portfolio of the California Public Employees Retirement Fund, for example, a major investor in venture funds, is down 20 percent and needs to raise capital. Cash will be scarce in 2009, no matter if you’re a pension fund, a VC or a start-up. Wall Street is broken. But Wall Street has been broken for eight years now, as far as Silicon Valley is concerned.

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In a mixed holiday sales forecast, an electronics industry trade group is projecting that consumer spending on such gadgets will grow 3.5 percent in the fourth quarter, half the growth rate in the same quarter a year earlier.

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For the solar industry, some promising news from the land of the rising sun.

According to Reuters, Japan’s Ministry of Economy, Trade and Industry is discussing bring back subsidies for the country’s solar sector. The story, citing unidentified ministry officials, says that the country is considering subsidies and tax breaks that could halve the cost of putting up solar panels in households. “It’s clear that lack of vision dented Japan’s lead in market share,” said the official.

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