I use only one password for all web sites
justmybloghere.tumblr.com
justmybloghere.tumblr.com
The author does not describe a single password, but rather an algorithm for creating passwords predicated on domain names.
Personally I'd prefer to memorise one complex password and use that as a key into a KeePass database.
Something like this would work fine:
Get the domain name, take the first 3 letters, reverse it, replace each character with the character that sits to the right of it on a keyboard. Append (or prepend) this to an already secure, remembered, password.
The only way a person can know which part of the password is variable is if they have access to two passwords generated by this system, from different sites. Highly improbable. Moreover, even if they do figure out which part does change, they have to try to reverse the algorithm.
Personally, I use rude sentences depending on the site, with numbers and punctuations. And a throwaway password for your "Show HN's" ;)
You could carry around a little pwdhash implementation on a smartphone or whatever, I suppose, the algorithm isn't rocket science: http://crypto.stanford.edu/PwdHash/RemotePwdHash/hashed-pass...
It's a pity this sort of thing wasn't build into the input type="password" in the first place ... maybe HTML5 should introduce an input type="passhash" ...?
But your idea of a bookmarklet is interesting!
I usually use sentances with 4 or so words, that is odd enough to remember. I combine that with keepass safe for sites i only log into on my computers and synch it using dropbox. I also have access to it on my iphone and ipad. The combination of these techniques enable me to log into most sites without a password manager and all of them on the fly.
Or better yet - actually use the same simple password on all web sites which are not important to me.