This is one of those odd things that I came up with on my own when I was a kid without ever hearing about the esteemed Marquis Pierre Simon de Laplace or any of his demons. Even though it isn't new, it's odd that I thought it up without any help. I remember sitting in bed when I was about 12 and thinking about how computers get faster exponentially, and just how powerful they could be made. If you knew all of the parameters in a system, you could predict what would happen next in that system. Computers predict things all the time, their power just depends on the size of the system it can analyze. Think about IBM's chess computer Deep Blue, which could come up with every possible move it could make and predict the opponent's countering moves. Such a raw efficiency is threatening, because it threatens to render the human mind obsolete.

But that doesn't mean it could happen. mblase makes a good point that such a machine would be more complicated than the universe itself. I also read a book cowritten by Arthur C. Clarke, called Richter 10 (I think), about an earthquake predictor who builds a giant computer to predict the movement of the Earth's crust, thus yielding a place and time for all future earthquakes. One of those things that bends your mind.