Where are the jobs?

GAO Report: July 8 Review

Wondering where all the jobs created by the stimulus money are. The above graph from the government July 8 GAO report linked above says it all.

As of June 19Th:

63% of the stimulus money went to medicaid

13% went to help states with their budget shortfalls

Only 6% went to infrastructure spending. (creates jobs)

The rest was unspecified.

The Largest Exporter

I've been trying to get a handle on this chart. This chart shows the 10 largest exporting countries in the world.

The largest exporting country in the world is Germany, not China! After all the talk about China being the largest exporter to America and how American jobs are moving to China, I expected China to be the largest exporting country, certainly not a small country like Germany.

I have lots of questions. How can Germany be the largest exporting country? China has 10+ times the population of Germany. How can a country the size of Germany (45 million workers) have enough resources to out produce China (808 million workers) and the United States (155 million workers)? One third of Germany is still covered by forests. Notice that Germany's exports are greater than its imports. How is Germany able to export so much material goods and not require a greater import of raw materials? You would think Germany would be draining all of its natural resources since the output is greater than the input. What is it that Germany is exporting that the US doesn't appear to buy a lot of ? Germany doesn't rank high on the import list for the United States.

I also have lots of questions about the US. Why does the US and the UK import so much more than they export? These two countries look distorted on the chart especially the US. People do things for a reason. Why does the US and UK choose to import so much more than it exports seemingly to its harm? What belief mechanism is causing this that the other countries in the world don't see? Are the US and UK becoming more efficient and getting lower prices for its goods? According to economic theory distortions become self-correcting. Why has this imbalance not corrected in 20+ years? What drives it one way? Is the US in some kind of transitioning to a better economy moving away from manufacturing to higher level types of work or to a more failing economy to balance out the difference between incomes in the US and China/India?

Why is the US no longer a technological leader in many fields? If we want to upgrade our harbors to more efficiently load and unload cargo containers ships, we have to buy from the Chinese or Japanese. They have the best equipment, software, and experience for managing this process. If we want the best TVs or cars, we buy either Japanese, Korean, or German. Fortunately, we still have the prowess in computer processor design but how long will we maintain that as companies like Intel and Microsoft start offloading design experience to China. We are more advanced in Agriculture technology. We do have a very creative Silicon valley that keeps generating ideas like YouTube, Facebook, Twitter, Google, etc. but many of these aren't making a lot of money. We've got creativity going for us, but we're being held back. South Korea's cellular phone and Internet are years ahead of the US. Why is our environment moving so slowly. We do have the outstanding iPhone but it could do much more if the carriers could move forward.

I'm puzzled, puzzled, puzzled.

Rule of law failing in the USSA

Is the rule of law regarding contracts failing in the US?

I was listening to an interview this morning with the President of Russia. He was talking about the need for global investors to invest in Russia. Global investment in Russia has fallen tremendously. He acted like global investors are really missing a good opportunity. Right! The reason global investors abandoned Russia because the rule of law failed. Suddenly taxes that no one had ever heard of were applied to the Yukos oil company which was sited and penalized for years of not paying these unknown taxes until the company was bankrupt and sold off to one of Russia's government run oil companies. Other unknown environmental laws suddenly appeared forcing non Russia companies to give up their stakes in Russian oil fields. The rule of law meant nothing. The laws suddenly changed to suit whatever Putin's government wanted to do. The current President denies that this was this case and says they have improved the rule of law. Of course, no one seems to believe him.

Now are we starting to see the failure of rule of law in the US under President Obama. Many ordinary people who invested their retirement savings in GM bonds suddenly discover that President Obama's auto task force worked out a "deal" that eliminates 90% of their investment in order to help the company and the union survive. These retirees had understood that their investments would be safe because the rule of law for bankruptcy said they would have first priority in a bankruptcy. Instead President Obama's task force hands over any money to the union who would not have come first if the rule of law had been followed. If people can't rely on the existing laws how can they feel good about investing in America. This is not a good precedent.

Now this morning the Citigroup Bank under US government control has said that they are not going to pay the rest of millions in severance to departed executives per the "contracts" with the executives. The bank didn't want to draw more attention to the big payments to executives and they're counting on that the executives will not sue to avoid drawing the public's anger. The payments are quite large. The contracts also stated that the departing executives would not work for a competitor and would not recruit employees from Citigroup. The failure to pay is a breach of contract. While Citigroup may be morally right in not continuing to "reward" the executives in power when Citigroup nearly failed, it is legally wrong to violate a contract.. If Citigroup will violate a contract to an employee, who is to say they won't violate a contract to a customer. Of course if Citigroup has breached the contract, I would say these executives can now work for Citigroup's competitors and can recruit employees from Citigroup. Then where will that leave this US government run bank that needs to pay the taxpayers back.

With the Chrysler and GM "bankruptcy deals" and the US government influence over the banks, I'm afraid we are starting to see the failure of the rule of law in this country. The rule of law made the US a great place to invest. Now investing in the US is becoming more of gamble. You can't depend on the existing laws. The government thinks the ends justifies the means. There are going to be economic consequences if the government persists in twisting the law. It does not bode well for the future.

Is it Constitutional?

I'm still not sure if its Constitutional for the U.S. government to come into a company, fire its company President, appoint board members, tell the company what kind of cars to make, tell lenders what decisions they should make for a deal, etc. This seems like an overreaching of government power to me.

Is this really the kind of power the Founding Fathers intended for the U.S. government?

Update on the Employee Free Choice Act

Looks like the Congress is looking toward dropping the part of the Employee Free Choice Act that would have removed the secret ballot for employees deciding whether or not to have a union. That's good news.

But the more dangerous part is still under consideration. The Act says that if a union and company management can't reach a contract deal in 90 days, then the U.S. government can come in and decide the contract for both parties.

That is very frightening especially given the recent government strong arm tactics in the Chrysler bankruptcy and coming GM bankruptcy. The government basically pressured lenders to forego their rights in a normal bankruptcy filing and asked them to lose 90% of the money they have loaned these companies. Then President Obama had the nerve to call these lenders greedy speculators for wanting to get their money back. Turns out some of these "greedy" people are Illinois teachers, policemen, and firemen. Their pension funds loaned money to GM and Chrysler thinking it was a very safe investment. These pension funds will lose 90% of their money invested in these companies. What greedy people they are actually wanting the return of their money. But we needed to save the UAW union after they and company management ran these companies into the ground.

So now we want to give even more power to the government in deciding union contracts with the Employee Free Choice Act. I think we know who the current government will support.

President Obama and Education

I have several questions for President Obama about education.

1. Why are his daughters in a private school instead of a public school?

2. Why did President Obama sign legislation that will remove poor children from his daughter's private school?

3. Why are public schools good enough for our kids but not good enough for his kids?

4. Why do nearly 1/3 of the Democratic congress have their kids in private schools?

5. Why should these politicians who avoid public education make decisions about my kids public education?

Government Motors

I'm trying to understand how a car company (GM) run by the government (70%) and the union (17%) is going to out compete the other car companies run by business people who understand the car business.

How is a government bleeding trillions of dollars going to help a car company bleeding billions of dollars eventually become profitable?

I saw in a news item today that some plants that GM had previously determined needed to be closed in order for GM to survive were now going to be kept open at the union's insistence. And you tell me that the government and the union can create a profitable company.

I'm afraid GM like nationalized companies in other socialist countries is going to be a black hole into which the government keeps pooring money down never to see it come back, but that's just my opinion.

I could be wrong. I hope I'm wrong. Best of luck to them.

Economic Future

I'm starting to get a picture of the near term economic future.

Looking at President Obama's massive spending increases for this year and the next several, its starting to appear that the major borrowing that the government will require is going to put strong pressure on interest rates to climb. The only way to avoid this is for the Federal Reserve to print money and buy the debt, but if they do this then inflation will increase dramatically. Either way will be a drag on the economy. Also, the governments massive borrowing is going to crowd out the money that could be lent to businesses and the rest of us.

My hope is that the Fed will not print money and will allow the interest rates to go up. I can handle the increase in interest rates better than inflation. I don't think anyone wins with inflation. Higher interest rates might make the government rethink all the massive spending it wants do.

We'll see what happens.

Communist Chinese are confused and so am I

Time article: The Other GM

The following except from the Time article above says it all.


Still, GM's Chinese employees are acutely aware that the times are anything but normal. Obama's decision earlier this year to dismiss CEO Rick Wagoner was a jolt. As one young executive puts it, "we didn't think in America that the President could fire the CEO of a private company. For us Chinese, it was very confusing." Doubly so because Wagoner is viewed as one of architects of GM's dominance in China. Says a former GM executive: "It may be the ultimate irony of [Wagoner's] career that as bad as things are in the U.S., his more important legacy may turn out to be China. People don't get that now, but they will eventually."


Even the Chinese are surprised that President Obama is exercising power over business that they nor I thought he had or should have. The recent use of President's Obama political power to force Chrysler's lenders to drop their property rights under bankruptcy law is especially frightening. Also, the President is looking for any and all money in businesses that he can find to take for his spending programs. If I was a major investor, I would be afraid to invest in American companies. Who knows what other regulations and taxes are coming down the pipe to punish these evil corporations.

Update on the Folding@Home

The Protein Folding grid computing project that I recently joined (see earlier post "Well I did it" from Friday March 27th) has kept my PC very busy this month. My PC was assigned the task of calculating how the proteins of a virus attach to a host cell wall. Though my PC's part was probably one millionth of the total calculation, it still took my computer nearly a month to compute its part at 2-4 hours a day but its all done ready for the next assignment.

Star Trek

WSJ article: Hollywood Starts Over

For you Trekkers out there, here's another article about the new movie.

I think the movie and acting looks very well done but the exerpt below from the article concerns me a little bit for continuity.

Through a plot device involving time travel, "Star Trek" wipes clean the history of the franchise to create an alternative universe which re-imagines the early life of Kirk (played by Chris Pine) and his time at Starfleet Academy, where he encounters Spock (Zachary Quinto of TV's "Heroes"), and later sets off on the Enterprise. By going back in time, the film effectively changes the course of "Trek" history, so anything can happen.

I thought one of the early critiques of the movie below was funny.

Fans didn't like how parts of the Enterprise looked in early screen shots, he adds, and many thought the bridge resembled the inside of an Apple store.

First U.S. President

Who was the first U.S. President to invade a Muslim country and overthrow its leader. I'll give you a hint. He was a Republican.







If you guessed Thomas Jefferson then you would be correct.


President Thomas Jefferson sent U.S. Marines into Tripoli in northern Africa and replaced the leader with his brother. The purpose was to stop piracy on American ships in the Mediteranean and the paying of tribute.

Years before, Thomas Jefferson and John Adams had spoken to the Ambassador from Tripoli as in the excerpt below from the Wikipedia article First Barbary War

In 1786, Thomas Jefferson and John Adams went to negotiate with Tripoli's envoy to London, Ambassador Sidi Haji Abdrahaman or (Sidi Haji Abdul Rahman Adja). Upon inquiring "concerning the ground of the pretensions to make war upon nations who had done them no injury", the ambassador replied:

It was written in their Koran, that all nations which had not acknowledged the Prophet were sinners, whom it was the right and duty of the faithful to plunder and enslave; and that every muslim who was slain in this warfare was sure to go to paradise. He said, also, that the man who was the first to board a vessel had one slave over and above his share, and that when they sprang to the deck of an enemy's ship, every sailor held a dagger in each hand and a third in his mouth; which usually struck such terror into the foe that they cried out for quarter at once.

The more things change the more they stay the same.

"History may not repeat, but it sure does rhyme" - Mark Twain

Age of the Bean Counters

Will the age of the bean counters ever be over?

The last 15 years have seen companies move from great employees making great products to how much can we reduce costs to show a great profit for this quarter. Keeping costs reasonable of course is one of many facets of balancing a business for growth and profit, but over the last 15 years cost containment became the driving purpose for companies.

Having a long term vision for the company and its products paled into insignificance. Products became commodities. Employees became commodities. Everything became a commodity to be manipulated by the bean counters even down to the company sponsored cafeteria, getting that last penny of cost savings. In the process these companies damaged themselves and their futures.

There are few of the old style companies left. Steve Jobs at Apple knows how to have a vision for products and the company. His only flaw is that he's from the 1970's when companies tried to make everything proprietary. Google founders have a vision of where they want to go and they don't treat their employees as commodities.

When employees at most companies finally realized they were commodities they started acting as commodities. They now do the work requested no more no less. Any ideas they have that might really advance the company are kept to themselves. After all they'll probably only be there a few years and move on. The only goal is to advance their career and income. The company is incidental.

Occasionally, a few employess will want to do something worthwhile. That's what happened many years ago with the Motorola RAZR phone. A small group of engineers led by a charismatic leader said what if we could design a phone incredibly thin. They wanted to do it just to see if it could be done. They had to do it in secret because the bean counters would have crushed the project because the phone would be too expensive to build and the project would waste resources that could be used to do incremental improvements to their existing products. At that time Motorola wasn't doing all that well as a company. Well the engineers succeeded in their design, the company started selling the phone, and the bean counters were shocked that people would pay so much money for a phone. Unfortunately, the charismatic leader died, the bean counters took over and then tried to incrementally keep changing the heck out of the RAZR design. As time went on, the bean counters managed the profit for the next quarter and never realized when the RAZR phone was starting to lose relevancy in the phone market. They were a one trick pony. As the RAZR era faded, sales started to fade, and now Motorola is once again a company that is rapidly becoming irrelevant in the cell phone market.

I worked for one of these companies that went from vision to bean counting. The company I worked for had a vision 15 years ago to produce products that would have the maximum performance but the least impact on the environment and would move fastest through testing and acceptance through the EPA. After many mergers, this vision was lost as bean counting became the main focus. The results were chemical products that damage the tanks containing the product and chemical products that require the dealer sites to make sure the product is stirred daily or else it won't work correctly when they sell it to the customer. The company actually setup a weekly sampling from every dealer site, lab testing of those samples and IT designed an automatic reporting systems of the lab test results because the customer business sites weren't keeping the product stirred. How's that for a bean counting vision. The company is still making money, but you have to wonder should there be major shift somewhere by a competitor would they have the employees that could respond to the challenge.

One last example of bean counters run amuck. The current CEO of Chrysler last gig was at Home Depot. The founders of Home Depot brought in this CEO from GE because the business was getting bigger than they wanted to handle. This CEO implemented his bean counting vision. He replaced the employees who had good construction knowlege and great customer skills with low wage employees and with less employees. After all an employee is a commodity, why not get the least expensive employee. The profits for each quarter soared at first but then Home Depot sales started cratering. No one wanted to shop there any more because you couldn't find anyone to help you and when you did they didn't know any more than you did. Customers started taking their business to Lowe's. Home Depot was on its way out. Fortunately, this CEO was removed and the new CEO is reestablishing Home Depot's former customer service.

Its time to return to the vision of great employees making great products. After all the business knowlege, ideas, etc. are in the employees heads. Employees are not commodities. They are the key to a companies success. Amazon knows this. Google knows this. Companies like AT&T, Dupont, Corning, knew this back in the 1960. They had visions back then. AT&T did basic research. They wanted to know everything about communication and electronics. Dupont want to know everything about chemicals. Corning wanted to know everything about glass. For the last 20 years however these companies have been focused on merger, acquisitions, profit, etc. Those are not bad things, but they lost their vision along the way and actually hurt the profits they were trying to maximize.

Let's all return to the greatness of the past. Lets focus on doing great and wonderful things. Let's stop focusing on our stock options, 401K's, and how many years we have until retirement. Let's be alive again. The future is now not when we retire.

Let's return to vision! As Steve Jobs said, let's make a dent in the universe.

An American Student

I've noticed an interesting difference between an American student and a Chinese or India student.

If an American student gets a bad grade in math, he or she says I'm just not good at math.

If a Chinese or India student gets a bad grade in math, he or she says I didn't work hard enough.

Which one do you think will be more successful?

Regulation and Basketball

In finding a balance for regulation, I thought of basketball.

What if there were no rules for basketball at all. There were no rules about how long the game would last, how you would know who won, how many points a basket earned, etc. No one would want to play. On the other extreme, if there were too many rules such you must pass the ball after two steps, shots may only be taken from one location on the floor, the ball must not touch the rim, etc., then no one would want to play that kind of game either. It takes the right balance of rules to make the game exciting to watch and fun to play. The rules give you a framework to work within.

Laws and regulations are important but they should be kept to the minimum that will get the job done.

Social Complexity

I was reading the various theories on the fall of Rome and came across one that I think is very relevant. Let me quote some of it below.

-- Begin Excerpt from Wikipedia article Decline of the Roman Empire
Joseph Tainter

In his 1988 book "The Collapse of Complex Societies" Tainter presents the view that for given technological levels there are implicit declining returns to complexity, in which systems deplete their resource base beyond levels that are ultimately sustainable. Tainter argues that societies become more complex as they try to solve problems.

When a society confronts a "problem," such as a shortage of or difficulty in gaining access to energy, it tends to create new layers of bureaucracy, infrastructure, or social class to address the challenge.

For example, as Roman agricultural output slowly declined and population increased, per-capita energy availability dropped. The Romans "solved" this problem by conquering their neighbours to appropriate their energy surpluses (metals, grain, slaves, etc). As a consequence of the growing Empire, the cost of maintaining communications, garrisons, civil government, etc. increased. Eventually, this cost grew so great that any new challenges such as invasions and crop failures could not be solved by the acquisition of more territory. At that point, the empire fragmented into smaller units.

We often assume that the collapse of the Roman Empire was a catastrophe for everyone involved. Tainter points out that it can be seen as a very rational preference of individuals at the time, many of whom were actually better off (all but the elite, presumably.)[citation needed] Archeological evidence from human bones indicates that average nutrition actually improved after the collapse in many parts of the former Roman Empire. Average individuals may have benefited because they no longer had to invest in the burdensome complexity of empire.
-- End Except from Wikipedia

I think this is a good warning as we consider regulation and bureaucracy in fixing our problems. We have to find a meaningful balance.

I've seen this in businesses. A small business can easily have a sales person, finance person, production person, etc. work together to achieve a solution for a customer, but as the business grows and the number of workers increase, the resulting complexity and increasing layers of bureaucracy turn informal flexible connections and solutions into rigid inflexible protocols of operation that are less likely to help the customer. Also, as often one time problems occur, policies are implemented to solve these problems but then create walls thwarting operations. Are the new policies for a one time problem worth the efficiency lost in day to day operations.

Risk is a part of life. You have to find a balance of safety versus risk. You can't make a policy for every single risk. For example, the safest way to never be in a car wreck is never to ride in a car, but that greatly reduces your options. The way to never have a financial melt down again is to encourage regulation that discourages lending. Your safer but won't have much.

Let's not over build complexity in our government. Its complex enough as is.

Solar Oven

CNN Article: Inventor turns cardboard boxes into eco-friendly oven

While solar ovens are nothing new, the inventor mentioned above in the CNN article was able to create a very simple one out of some cardboard boxes and a pane of acrylic plastic for about a total of $5. This oven can bake casseroles and boil water. The beauty of it is the simplicity and costs. This oven could be easily mass produced for people in Africa and other areas to use for cooking without having to cut down trees for firewood.

Great job!

Some recent jokes

"According to the government, Rick Wagoner was forced to resign because of poor performance. That's embarrassing. You run an organization that loses billions of dollars and then get fired by a guy who heads up an organization that loses trillions of dollars." --Jay Leno

"President Obama is giving General Motors 60 days to come up with strategy of viability for the American taxpayers' money. You know what G.M. should have said? 'Hey, you first.'" --Jay Leno

"Barack Obama made his first trip as president to England. Here is my question. If the President is in England, who's running General Motors?" --Jay Leno

"As you know by now, the government is now taking an active role in the auto business. President Obama offering hope, change, and 0 percent financing." --Jay Leno

"And more embarrassment for the President. Just a few weeks after President Obama named Kansas Gov. Kathleen Sebelius as his Health and Human Services nominee, she now reveals she owes over $7,000 in back taxes. Another one owes. See, that's the difference between the two political parties right there. Republicans believe in no new taxes. Democrats believe in no old ones." --Jay Leno

"President Obama also said if you do buy a new car, you will be able to deduct - that's right, I said deduct - the sales tax from your income taxes. Or you can just take a job with the White House and not have to pay taxes at all." --Jay Leno

"So the United States government is now running General Motors, because if there's anyone who knows anything about streamlining costs, it's the U.S. government, ladies and gentlemen." --David Letterman

Health care

There is a discussion that I never hear when people are discussing how to fix health care. Its a discussion based on economics.

If the price of something is always the balance between supply and demand, then the ever increasing costs of health care must mean that either we don't have enough supply of health care services available or the demand is too great.

If we add government health care for people who don't currently have health insurance then theoretically this should put even more demand on the existing health care facilities thereby driving the costs of health care up even faster. Of course then the government would put price controls in place just as it did for Medicare. This would then decrease the health care supply thereby creating shortages of service.

Why does current demand drive health costs up so fast? Why does the current demand exceed the supply? Its because people who are fortunate to have health insurance control a large supply of money for health care.

Let me give an example. Someone finds a lump. They have a doctor check it out and he determines its probably a cyst. It gives every impression of just being a cyst but the doctor can't guarantee its a cyst. If it is a cancerous tumor then its one of the worst. The doctor is sure its a cyst and says there is probably only a 2% chance it could be cancer. The doctor recommends not to worry about it. An MRI could give more confirmation but that's expensive and the lump is highly unlikely to be cancer. The patient who has health insurance decides they want to do the $3000 MRI. It doesn't cost them much. The health insurance will cover nearly all of it. If the patient had to pay the $3000 or a large part of it, they would probably not do it but when it seems nearly free why not be sure. That patient has just created a demand for an MRI because it seems to have no costs. The health insurance company is probably paying for an unnecessary service and that's how we get high health care costs. Too many dollars chasing too few supply.

I'm not saying I have a solution and I do want everyone covered by health care insurance, but any discussion of solutions needs to include a basic analysis of the economics.

At least we need to somehow increase the supply of health care services. We're not graduating enough doctors and nurses to meet the demand. We do need electronic records. We do need more competition to encourage efficiency. Hospitals are woefully bureaucratic. We need a 21st century redesign of how a medical institution should work.

Simply covering more people and not changing anything else will not make a healthy health care system. We will only make it worst.

Great Math video by a teenager

--

You can run but you can't hide

WSJ Article: To Sketch a Thief: Genes Draw Likeness of Suspects

The article above describes how scientists are discovering genes that help them determine what you look like from a sample of your DNA. They are identifying genes that indicate your race, skin color, eye color, hair color, face length, face width, nose width, shape of the lips etc. all from just your DNA, basically building a police sketch from your DNA. They hope to use the technology in criminal investigations.

Well I did it.

I've always loved science. From third grade on I always wanted to be a scientist.

I was actually a physics student in college until I found computer science more alluring. That's way back when computers were the giant electronic brains that only the priesthood (computer programmers) knew how to communicate with. I loved that experience.

But ever since I've wanted to get back to science and specifically physics. Being a busy father and husband doesn't quite permit that luxury yet, but at least I can participate in a small way.

I recently bought a computer, nothing powerful or expensive but a good average computer. Last night I downloaded software to my computer that allows it to participate in a grid of computers doing analysis for scientific research, specifically protein folding.

What the software does is use your PC's idle computer time to do calculations for modeling how proteins in your human cells fold up in their final shape for use. Proteins are the chemical machines that do the work in living cells. The proteins are assembled by stitching amino acids together. Once a protein is completed, it is released into the cell where it folds up in a specific shape. Its shape allows it do its chemical work. Its shape results from the final outcome of the electric forces of each of its atoms pushing on each other until a balance is found resulting in the final shape. What the software does is simulate the physics of each nanosecond how the atoms are pushing on each other to get to the balanced shape.

There are so many calculations that there isn't a super computer on the entire planet that could do the calculations in a reasonable amount of time for even one protein. Therefore, the researchers decided to use grid computing to parse the work out to anyone's computer who wants to participate. There are approximately 400,000 people participating and they now have more computing power than all the supercomputers on the planet put together. Even Sony Playstations can download the software and participate and many people are doing just that. In fact the Playstations have great computing power. For the newer PC's the sofware is using all the CPU cores and even the graphics processors to do the work.

I downloaded the software to my PC last night and it completed its first calculation assignment in about three hours. The software runs in the background. It didn't interfere or slow my use in any way. In fact I had to keep checking on it to see if it was still running. It makes me happy. Sometimes its the small things.

The researchers are now focusing more on misshapen proteins. Many diseases are caused by misshapened proteins.

The research and computing program are run from Stanford University. Below is their web site.

http://folding.stanford.edu/

Honda's Hydrogen Car customers

Here's a link to see the people currently leasing the Honda Hydrogen car in southern California.

Honda FCX Customers

Hey Mikey, he gets it!

President Obama finally gets it. He finally understands that beating the goose that lays the golden egg is not the way to fix the economy.

President Obama's long anti business rants are finally coming to an end as he realizes that without business he has nothing to work with. He finally understands that he must be leading and doing the right thing to solve problems.

Acting as if all business people are greedy good for nothings is both untrue and unhelpful, not to mention his attacks recently damaged his own administration as blame fell on his own chosen Treasury Secretary.

Now, maybe President Obama can get to work on fixing these problems.

And I don't want to hear any more about how the Republicans got us in this mess when President Obama himself voted as senator two years ago against stricter regulations on Fannie Mae and Freddie Mac as proposed by John McCain. The democrat congress of the last two years is just as guily at looking the other way as any other.

So lets get down to business and fix this mess.

Given the recent March Madness

Given the recent March Madness, and no I don't mean President Obama's continuing attacks on the business world, wouldn't it be cool to be able to watch the NCAA basketball games on your big screen TV and share the games with your friends.

What do I mean? What if you could watch a game on TV and be connected to your friends wherever they might be. Your big screen TV would show the game in one "window" while you would see your friends in other windows on the screen like a video conference. You could see each other, share comments, yell, jump up and down. You could share the experience. This could also apply to movies or other television shows on TV. You could watch these together. Also, with recent annoucements that any video game will be playable across the net without a need for an Xbox or Playstation with new gaming technology then this experience could be shared as well.

Its coming. How fast is difficult to discern. These days its not the technology holding these ideas up, its the fear of losing control by the providers of media content. Its funny, their fear often makes their loss of control more complete. Those that adapt early actually maintain more control of their content in the long run.

Americans Learn from Russia

Well its nice to see that the Russians have taught Americans something, writing tax policy to target specific individuals.

As much as I'm not happy about the bonuses at AIG, writing tax policy to target those specific bonuses is nutty and seems dangerous to me as a new government policy. I don't think the congress will succeed, but should they pass it we will be in for a long haul of a legal fight and I almost wonder if its constitutional writing law that is specific for certain individuals. Of course the tax code already does that to some extent targeting the wealthy.

For a while there was talk about nullifying the contracts which violating contract law would not be in the best of interest of the United States. Thankfully, the government officials finally got some sense in them about that and dropped that idea.

A lot of people said that the AIG contracts should be renegotiated to remove the bonuses just like the UAW is having to renegotiate its contracts with GM, Ford, and Chrysler. The UAW contracts are being changed for now and the future. The AIG contracts are for last year. I don't think the UAW is being asked to renegotiate the money the workers earned making the cars last year that nobody wanted. The UAW contracts are being renegotiated for the coming years and I'm sure the new AIG contracts will be renegotiated as well.

Is the congress trustworthy. After the big blowup about the bonuses the congress and Timothy Geithner finally admitted they knew about the bonuses all along. I guess that means the congress was actually lying to us for several days before they finally came clean.

But the whole things seems absurd to me. Congress has blown enough money on bridges to nowhere to equate to at least 1000 million dollars per congressman. The congress should not be wasting time on AIG bonuses of 167 million while the economy burns down. Fine get indignant about the bonuses, say you don't like it, but its a contract, can't change it, and then move on to the nation's business.

The contracts were written more than a year ago, so I don't see there is much to be done. Of course its not clear to me how you can have a bonus. I thought bonuses were divided out of profit. If there's no profit how can there be a bonus. I did hear one short analysis that said what they call bonuses on Wall Street are really more like sales commissions. You earn a sales commission on what you sell not on the profit the company makes. But I can't verify this.

I'll end with a statement made by Jay Leno to President Obama.

"If the government decides they don't like a guy, all of the sudden hey we're going to tax you, and, boom, and it passes, that's seems a little scary," he said. "It was frightening to me as an American that Congress or whoever could decide I don't like that group, let's pass a law and tax them 90 percent." - Jay Leno

American Chavistas at work...

Well the American Chavistas are at it again.

The unions recently sent a letter to Treasury Secretary Timothy Geithner asking him to silence any company receiving bailout money from campaigning against the Employee Free Choice Act. This act eliminates the secret ballot form of voting for employees voting whether or not to unionize. Without a secret ballot, the union people can intimidate others into signing union cards.

The very act of an outside organization asking a government official to use his power to silence its opposition is a very frightening precedent. As far as I know the Treasury Secretary has ignored the request, but the potential is not good.

The unions also are responsible for the language put in the stimulus bill to stop the policy to allow Mexican trucks to deliver goods into the U.S. which Mexico said is a violation of the NAFTA trade agreement. Mexico has retaliated. Thanks to the unions the word of the American government is no longer trustworthy and now we have a trade war. Just what we need in the middle of a depression.

I guess the unions are going to do for the U.S. what they have done for education and the car manufacturers.

Stock Market Cartoon

I had to share this funny cartoon about the bear stock market and the government attempts to fix things. The people are Federal Reserve Chairman Ben Bernanke, President Obama, and Treasury Secretary Timothy Geithner.

FINALLY!!!

For years, I've been wanting a simple light tablet that I could comfortably sit down with on the couch and surf the web or jot down notes, just a simple tablet screen without a keyboard. I would like to take it to meetings to hand write notes like a notepad. Just something simple. Have I said that enough.

Whenever I've mentioned this to other people, they look at you funny. No keyboard, what good is that. They don't seem to understand that the handwritten notes can be converted to typed text later or maybe the notes don't even need to be converted. As long as I can look up my notes who cares. Also, I would like the device to have a camera for scanning any documents passed out at a meeting or to take a picture of poster notes created during the meeting. Then I would quickly have that information available to me all the time on my tablet. Note I have used a digital camera before to get a record of poster notes and passed out documents and its worked well, but you get even more stupid looks when you do that. And of course there is the hassle of moving the pictures from your camera to your computer.

FINALLY, Apple is rumored to be building such a device (article: It's Time For An Apple Tablet). I'm sure they're mainly developing it for web surfing, music, videos, etc. So I may not get the note taking abilities but at least it will be a start. My hopes are high.

Why do the simplest things I want seem to be the most difficult for people to understand.

p.s. Note that I'm not saying I will buy an Apple tablet, but maybe it will encourage the rest of the market to move in the right direction.

Big Government is On Its Way

Consumer Product Safety Improvement Act

I guess President Obama is accomplishing his goal of reversing President Reagan's achievements that gave us 28 years of growth.

Big Government is on its way back. The recent bill regarding lead and phthalates that went into effect on February 10 as I understand it requires any items sold for children's use to be tested and certified that it is lead and phthalates free. Sounds harmless and reasonable but its not. The law requires every batch of items to be certified.

Before there were existing laws against lead, now the new law says everything is guilty until proven innocent.

Small businesses are saying they will go out of business. One business owner said that if he produces a batch of 20 coloring books he must have them tested to certify they are lead free. The certification test cost nearly $2000 dollars. Even buttons on children's clothing must be certified. Bicycle vendors are having to take bicycles back because there is lead in some parts that is normally allowed but not under this law. Goodwill says they have $175 million worth of items that they can't sale now. Walmart is making many vendors take their products back because they're not "certified".

This all reminds me of the 1970's before Reagan got rid of this mess. I remember the government agency OSHA came out with a ruling that businesses must convert all toilet seats in their companies to oval shaped toilet seats. Then a few years later, OSHA changed its ruling and said all toilet seats must be horse shoe shaped costing business a lot of money. The government was involved in everybody's business to the minutest detail.

President Reagan freed us from a lot of this nonsense and the economy took off. The environment afterwards was quite different from the sickness and stagflation of the 1970's. Now when we are in our worst economic decline, the democrats want to heap this mess and costs on us again.

Here's a quote of who is affected by this law from the government office empowered by this act.
"Anyone who makes, produces or assembles a product is considered to be a manufacturer. If what you make is sold or donated, something as simple as adding ribbons to hair clips, knitting hats, or stringing beads into necklaces make you a manufacturer. " Quite broad, I would say.

Oh by the way the same office says there is really no way to test and certify there are no phthalates in an item but do you best to make sure.

Should have been in the stimulus

President Obama could have had a quick easy stimulus if he had eliminated corporate taxes for one year. This would have strengthened businesses and encouraged them to hold on to employees for a while longer. It would only have cost $325 billion and been immediate with no losses from government handling of money.

An even better option would have been to allow corporations with profits offshore to bring that money home with no taxes for one year. Generally, that money is not taxed if left in the foreign countries. The money is only taxed in the local country and not taxed again by the U.S. I bet a lot of that money would have flowed back to the United States stimulating the economy.

Instead President Obama is suggesting the opposite. He wants to tax the money that companies have in foreign countries, so companies will have to pay tax twice once to the foreign country and then again to the U.S.

I wonder if this will drain money from the U.S. If companies have to pay U.S. taxes on the money they use in their foreign operations, then they will have to replace it from somewhere to keep their foreign operations growing. That may mean they have to send money from the U.S. to their foreign operations.

President Obama and the Democratic party seem to be following their anti-capitalist philosophies.

As one business broadcaster recently asked, "is communist China the last great capitalist free-market country on the planet".

Job hunting for introverts

Fortune Article: Job hunting for introverts

I thought this was a helpful article but funny to me since I are one, an introvert that is. Hopefully, I won't be job hunting again any time soon.

The Digital Generation

Click on the picture for a larger image.

I actually saw some teenagers doing this on the ski trip my son and I took in February. The teenagers were in the lodge where my son and I had lunch. I was quite amazed. The teenagers were listening to their ipods with earphones, playing cards, talking to each other, and were on their phones. I couldn't figure out how they could listen to their music and hear each other. WOW! No wonder kids are bored with schools that are still using tools from 100 years ago (ie: chalk board, books, paper).

Online Healthcare

WSJ Article: Cough, Cough. Is There a Doctor in the Mouse? (may require a subscription)

Microsoft Health Vault

This article describes online medical care offered through the internet. I was surprised to see that so much development was already in the works for online health care.

Watch the video on the Microsoft site and check out the web applications link on the lower right of the Microsoft web page.

From the article:


"In January, American Well Inc. went live with a Web service that allows patients to communicate with doctors via online video, text chat or phone. The doctors can view patient personal health records through Microsoft Corp.'s HealthVault and even prescribe medication over the Web. The service is currently available only in Hawaii through the Hawaii Medical Service Association, the Blue Cross Blue Shield affiliate in Hawaii. HMSA-insured patients pay $10 for a 10-minute visit; uninsured or non-member patients pay $45 for a 10-minute consultation."

Ben Bernanke

If the economy starts to recover in the next 12 months it will be due to the efforts of Ben Bernanke at the Federal Reserve not President Obama. Obama's stimulus plan won't really fully start kicking in until 15 months from now.

Ben Bernanke is working to repair the country's economy now. Bernanke's lastest effort is the Term Asset-Backed Loan Facility. This is an attempt to restart the debt securitzation market for credit cards, auto loans, student loans, etc. The chart above shows that this market has fallen from a $1 trillion market to a very small few billion. That's part of the reason there is not a lot of credit available.

A similar technique was used to restart the commercial paper market last fall. The technique worked very well. The commercial paper market was dead in the water threatening to shut down businesses because they couldn't get simple short term loans for daily operations. Bernanke got the Fed in the market and initiated the loans. The market rebooted and has been working smoothly since last fall. Now he is doing the same thing for the consumer market.

Way to go, Ben.

Update on the Employee Free Choice Act

Wall Street Journal Article: President Tells Unions Organizing Act Will Pass (may require subscription)

President Obama told the AFL-CIO union that the Employee Free Choice Act will pass. I guess its clear now where the President stands.

Other interesting items from the article:

"Separately, on Wednesday, the AFL-CIO is expected to ask the administration to take a controlling stake in banks that receive government funding and a more active role in restructuring their balance sheets."

"Organized labor plans to mobilize workers in states where support is weakest among Democratic lawmakers, lobby lawmakers directly and get companies that support the bill to endorse it publicly. Labor leaders didn't name companies targeted in this effort."

Maybe my nutty conspiracy theory isn't so nutty.

Netflix of Books

Just as Netflix offers all the movies you can watch and Rhapsody offers all the music you want to listen to or download to your mp3 player for a flat monthly fee, I wished Amazon would let me read as many books as I want online for a flat fee per month. I would gladly pay it.

Amazon has already loaded the entire contents of books for its search inside service, why can't they just take the next step and give me total access for a flat monthly fee. This is a case of the technology exists but fear stops it.

I'm sure the publishers are afraid the books will be copied and distributed accross the internet for free, but there's nothing to stop this now. One could quickly type or scan any book into an electronic file now and put it on the internet. Why doesn't this happen? It doesn't happen because people don't want to be arrested or sued.

Subscription based services are where the music, video, and books industries are going eventually anyway, especially once we have fast wireless internet access everywhere. Why do they waste time dragging their feet and actually encourage piracy by their resistance.

AMAZON, PLEASE PUT BOOKS ONLINE AND ON YOUR KINDLE FOR A FLAT FEE.

p.s. I would buy an iPod for music but Steve Jobs doesn't think subscription makes sense. Well, I don't think buying music makes sense.

With Rhapsody I can listen to anything, anything at all and it cost a lot less money. Poor iPod users can only listen to what they've purchased and they spend a lot of money getting a very small fraction of what I can listen to. The Netflix model ROCKS.

Great Depression and Stock Market

When people think about the stock market crash that started the Great Depression, they think it crashed all the way on October 29, 1929. Actually the market only lost about 12% of its value that day.

The stock market actually took nearly 3 years to finally reach the bottom on July 8, 1932. On that date the market was 89% below the highest peak reached on September 3, 1929. So the stock market actually crashed slowly over about 34 months.

Since I thought back in November 2008 that we were as close to creating the conditions that initiated the Great Depression as we could be, I thought I would create a spreadsheet with the stock market data from 1929 through 1940's and see if our stock market now was following the same pattern.

I plugged in our stock market peak of 14,164.53 obtained in October, 2007, and then created a column with the same percentage drops matching the depression stock market data on a monthly basis. The pattern has been remarkably similar except the predictions keep coming with a 3 month delay.

The spreadsheet predicted we would reach the 6000's by December 2008 but we didn't reach it until March 2009. I've been watching the spreadsheet since early December and it has predicted each month well. Though I have to keep at it with a 3 month delay.

If the pattern continues we should bounce around the 6000's with a pop to the 7000's occasionally for about 6 months and then the market should capitulate down to the 5000's.

If we followed the pattern all the way down, then we would reach the bottom of 1600 around November of 2010.

Are you depressed yet? Amazingly, I am not. I don't expect the pattern to hold.

I think there are many differences between then and now.

Then, the Federal Reserve was doing exactly the wrong thing that made things worse. Now, the Federal Reserve is doing what it should be doing and doing it well.

Then, there was no FDIC to insure depositors accounts. Now we have that.

Then there was no unemployment insurance, now there is. These are safety nets they didn't have back then. I think these buffer the economic crash somewhat. These were good FDR policies.

Unfortunately, FDR created several policies that made things worse such as wage and price controls which actually decreased the number of jobs.

I worry that President Obama is making similar mistakes. Some of the policies I'm seeing I think will make it more difficult for small businesses to keep or hire employees.

I'm not ready to give up yet. I think at any point along the way we can still create policies that stop the crash and start a rebuild.

Fortunately, things do start to repair themselves. For example, everyone is saving again. That hurts the economy now but it does put more money in the banks which helps them to heal. Also, long term that built up stash will start looking real good for spending after a long enough time of deprivation. At some point you want to live a little and stop being afraid.

It may take a few years but eventually things will turn up. They always have. :-)

Thinking of code

I tend to think of cellular DNA code as like a computer program. There are different parts of the code that gets called like subroutines in a computer program.

I think of cancer cells as containing damaged DNA code that is operating like a runaway computer program.

When I was a student in Computer Science at NC State, I use to laugh at freshmen who would frequently create runaway programs. A runaway program is a program that was accidentlly written in a way that would never stop like the program below. "i" will never be o or less so the computer will run the program forever. The author would probably have intended i = i - 1.

i = 10
while i > 0 do
i = i +1
print i
end

At that time in school the results from computer programs were printed out on computer paper. If a program ran away, you might get a 3 inch thick stack of paper. Fortunately, the computer had limits on how long a program could run or how much paper could be printed or the paper would never have stopped. (Yes, I wrote a runaway program once and got the stack of paper).

Just like one small change in the + sign or - sign in the statement i = i + 1 made the difference in a working program versus a catastrophic destruction of trees in paper use, I think a small change in a DNA code strand can create a runaway program in a cancer cell.

If researchers could compare active DNA strands in a normal cell with the active DNA code in a cancer I wonder if they could identify where the code is broken. I don't know if researchers have that kind of capability yet.

Interestingly enough, cells actually have internal DNA code that verifies that the other DNA code in the cell is working correctly. If the checking code finds a mistake it triggers other DNA code to terminate the cell so that it doesn't keep operating. This actually happens all the time in our bodies. Cells do make mistakes in our bodies and terminate. In cancer cells, either the code checks have failed or the terminate code has failed so the damaged cell keeps going and replicating. Since the exterior cell wall of the cancer cell still looks normal, the body's defense systems don't detect anything wrong and don't attack the bad cell. The cancer cell grows and replicates without anything to stop it.

If we could just understand how the code is broken maybe we could gain insight in how to cure cancer. But then again how would we fix the cancer cell code or terminate the cancer cell. How could we identify a runaway cell and how could we target it. I still wonder if the cell wall changes in some unique way in a metastasized cancer cell that would allow us to target it. Then maybe we could elminate the spread within the body and cancer would just become a chronic local condition instead of attacking the entire body.

Why does it move

I talked in a February post about how do cells know to stay where they are to form the structures of our bodies. For example, how does a newly replicated bone cell know to stay where it is in the bone and not start replicating new cells in a random direction.

With that concept, I recently thought about metastasizing cancer cells. Cancer cells initially stay in the place of their origin, but eventually they reach a stage where they metastasize and start replicating and moving through out the body. At that point I wondered what has changed about that cancer cell. Why does it no longer stay in its place of origin. Has some gene suddenly turned on or off that then frees the cancer cell to wonder. Has the cell wall changed in some fashion.

First it would be interesting to understand what DNA code is turned off and on in a cancer cell versus a normal cell. Then it would be interesting to understand how the DNA code has again changed in a cancer cell that is free floating versus a stay in place cancer cell.

American Chavez...

First of all note that I like President Obama. I thinks he's a man of integrity and wants to do what's right.

However, I couldn't help but notice that some of his actions and those planned by his party could look suspicious.

So let me be a conspiracy nut for a minute and note some actions that are Hugo Chavez like in Venezuela.

1. Manipulate the Representative Assembly.
President Obama is moving the 2010 Census office from the Commerce Department directly into the White House. Someone could say he wants to manipulate the statistics in heavily Democratic states to increase their numbers in the House of Representatives.

2. Nationalize the Banks
Then the government can control how money is invested.

3. Suppress Dissent with the "Fairness Doctrine" act.
The Democrats don't like the many conservative talk radio shows which far outnumber liberal talk shows. The "Fairness Doctrine" would be an attempt to rein in those conservative shows under the guise of "creating balance". It doesn't matter that the American people are currently deciding and supporting the number of shows. The government should not be regulating speech. The "Fairness Doctrine" is not fair.

4. Intimidate the Opposition. Pass the "Employee Free Choice Act" act.
You've got to admit the Democrats have smartly employed a tactic from the pigs in Animal Farm by George Orwell. Name the bills the opposite of what they really do.

This bill should really be called the Eliminate Employee Free Choice Act. This act would remove the secret ballot for employees voting whether or not to have a union. Instead of a secret ballot, each employee that wanted a union would sign a public card stating so. After enough cards were signed a union could be introduced. This is a great opportunity for the union. Union thugs can intimidate employees into signing cards just like the Chavistas intimidate voters in Venezuela. Everyone knows who signed and who didn't. More union members mean more money for unions and more money for the Democratic party.

Okay, that's enough consiracy theory nuttery for today.

I don't really think there is some "great plan" in the works to grab power, but I do think people can act and vote without realizing their preferences are leading them down a path best not to go.

Democrats drunk with power

NY Times Article: A Moderate Manifesto by David Brooks (free access)

The Democrats think their majority win in the election was a mandate for far left ideology. I think they're drunk with power with comments like we won and we will make the decisions.

The article above is a good shot by moderates at the increasing excesses of the Democratic left in power now.

Democrats working to doom school vouchers in D.C.

Article: Will Obama Stand Up for These Kids? probably requires a subscription to WSJ.

The Wall Street Journal had an article today about two students who attend the Washington D.C. school that President Obama's daughters now attend. These two students and others attend this school with school vouchers granted to inner city kids from low income families. These kids otherwise would not be able to attend this school.

The Democrats have added language to a bill to allow this voucher program to die in 2010. At that point these two students will no longer be able to attend this good school but must return to their failing local public school which has low graduation rates, metal detectors at the doors, and security guards.

The Democratic party supports the teacher unions in their campaign to stamp out school vouchers. School vouchers give parents a choice. Teacher unions do not want this choice. The Democratic leaders send their kids to private schools and deny that right to poor people condeming them to failing schools and continued poverty.

Interestingly, President Obama has an awkward position on school reform. His party supports the public school status quo, but he espouses change. Let me end with a quote.

"The biggest source of resistance [to reform]," he said, "was rarely talked about . . . namely, the uncomfortable fact that every one of our churches was filled with teachers, principals, and district superintendents. Few of these educators sent their own children to public schools; they knew too much for that. But they would defend the status quo with the same skill and vigor as their white counterparts of two decades before." -- said by President Obama when he was a community organizer in Chicago.

What will he do before these kids lose this opportunity?

Energy Independence vs. Energy Diversity

President Obama laid out the goal of energy independence in his State of the Union address. Americans have been saying that we need this since the 1970's.

I believe energy independence is not a realistic goal. Energy diversity is a much more attainable goal and achieves the same results. We don't need to produce all of our energy ourselves. We just need to diversify our energy sources to dilute pricing/political power in any specific energy area such as oil.

For all our fears about importing oil from the Middle East, we only import about 10% of our oil from the Middle East or about 2 million barrels a day out of 20 million barrels of oil a day that the U.S. needs. We're already producing 668,000 barrels a day of ethanol. What if we could get that up to 2 million barrels a day and replace the oil from the Middle East. I don't think we need to replace Middle East oil, just keep pressure on the market with diversity.

Stimulating Environments May Help Alzheimer Patients Regain Memories

PBS Article: Of Mice and Memory (You will need to search for mice in the page as its one of several different articles on the page.)

This article describes observation of some Alzheimer patients and experiments with mice that seem to indicate that more mentally stimulating environments can help the brain regain memories that have previously been lost.

Interesting item...

Click on the picture for a larger image.

Above is a picture of the largest cylindrical aquarium in the world at the Radisson SAS Hotel in Berlin. The aquarium contains 2,500 tropical fish.

My take on the financial crisis

Starting in 2002, the U.S. Congress started putting pressure on lenders to provide mortgage loans to people who would normally not qualify for a mortgage. The Congress strongly suggested that the lenders were redlining specific neighborhoods and discriminating against certain groups of people. It was suggested that lenders might need to be investigated and/or new laws created to stop this discriminatory practice.

The lenders then invented a way they thought would accomplish the task and be "safe" by pooling subprime mortgages with prime mortgages and then dividing them into liquid securities (CDO's).

At about the same time there was a growing ton of money slushing around the world that was driving interest rates down. The money investors (your 401K, pensions, etc.) wanted higher rates on their investments but the supply couldn't meet the demand so rates kept falling. Then the CDO was born which could offer 1-2% higher interest than everything else. Looking back the subprimes should have made the CDOs offer 6-7% higher rates, but the abundance of money kept them low. Also, the rating agencies pronounced them safer in the CDO's therefore a higher premium wasn't needed.

The subprime mortgage borrowers saw their chance to get a house, an unbelievable opportunity. Many took the mortgage and didn't pay much attention to the details. The additional new buyers in the market then drove house prices up which made the subprimes look ever safer both for the borrower and the investors.

The banks loved it because they could sell the mortgages off to investment houses who then packaged and sold them as CDO's to world investors. The banks didn't have to keep risky mortages on their books and they got to collect the fees for receiving the mortgage payments. They serviced the mortgages but did not own them. The investment houses made money on the sale of CDO's. The world investors (your 401k, pension, city government, etc.) got 1% better interest for "no extra risk". The subprime borrowers got a house, the American dream. Congress accomplished it's goal of more people in homes. It was a win for everyone. Why would anyone not want to do it.

Unfortunately, the ridiculous initial low rates on the subprime mortgages started resetting and subprime borrowers found they could not handle the large increases. The foreclosures started increasing and the banks were soon discovering they didn't have enough cash to cover the losses. The banks started worring about loaning money to other banks so they stopped. This froze up the credit markets for everything (houses, cars, business loans, etc.). Businesses discovered that they couldn't fund their normal operations. Fear gripped everyone. Businesses started cutting employees. Employees became fearful. Everyone is cutting back. Home values fell, job losses started prime mortgages to start failing. So here we are.

Who is guilty for this mess? The answer is everyone either directly or indirectly.

Subprime borrowers for not understanding their mortgages.
Lenders for not making sure the borrowers understood their mortgages and for underestimating the risk to investors.
Government for pressuring for subprime mortgages and not thinking about what lenders and markets had known better for over 70 years. You don't give mortgages to people who can't afford them.
Investors like you for wanting a better than 3% return on your investments so you could have that nice retirement.

So there we are. We're all implicity or explicitly guilty and we all need to realize that we're going to have losses. That's just the way it is.

I think everything will resolve itself faster if we just face the losses whatever they will be and then move forward. All these goverment actions to try to prevent the losses as much as possible will just drag the pain and fear out for years.

p.s. My 401K is now a 101K. ;-)

Say what?

"If these conditions do not hold -- if nobody outside Washington is really paying attention to the substance of the bill, if the true costs . . . are buried in phony accounting and understated by a trillion dollars or so -- the majority party can begin every negotiation by asking for 100% of what it wants, go on to concede 10%, and then accuse any member of the minority party who fails to support this 'compromise' of being 'obstructionist.'"
from the 2006 book "The Audacity of Hope" by President Obama

I don't think I could describe any better what just happened with the stimulus bill.

Is his quote a critique or a battle plan? Looks like the latter.

Am I Green?

Am I green? Well, yes and no.

I've always had a disdain for environmentalists since the 1970's when I was in college. The regional electric power company was trying to get approval to build a nuclear plant. The local environmentalists were so alarmist and emotional that they had the average person believing that the nuclear plant could blow up like an atomic bomb and no one wanted an atomic bomb near them. The environmentalists weren't necessarily saying this but they weren't trying to clear up this misconception either. I decided then that environmentalists were untrustworthy in their science and used propaganda to inflame emotions. One of the early members of Greenpeace Movement, Patrick Moore, wrote an interesting article in the Wall Street Journal saying much the same.

However, the environmentalists were right about a lot of things in 1970's. We unwittingly were polluting our rivers, land, and the air much like the problems that China is experiencing now. We didn't really think about dumping textile dyes and other chemicals into rivers as a problem. After all the river washed it away or so it seemed. Under the environmentalist movement pressure we made many changes which have made for a better environment in the U.S. We banned dumping and cleaned up our rivers and air. Its not perfect but better than it would have been. Get behind a car in the morning whose catalytic converter hasn't fully heated up yet and see how the air smells. We're much better off.

So environmentalists have raised many valid concerns but as developed nations have worked to clean up the environment, its seems environmentalists have begun to reach for extremes to justify their purpose. For example, the 2008 fad concerned BPA used to harden plastics in toys and bottles. The science was poor but the environmentalists wanted to have its use banned after many years of no apparent harm in favor for other chemicals that we don't have much safety experience with. BPA was the fad of the year for 2008.

So far it doesn't seem I'm green so lets switch gears.

My type of green is not conservation but efficiency. Conservation to me means live in a log cabin and get your water from a spring. Efficiency in the green movement is what I relish. How can we accomplish the same thing or even more with less input.

Let me note several examples of what I mean.

If your gas furnace is over 20 years old, only about 50-60% of the heat produced by the burning gas actually heats your home. The other 40-50% goes up the exhaust chimney. Today's gas furnaces put 90% of the heat into your home. That's a huge difference.

Only 1% of the energy in a gallon of gasoline is used to actually move the driver. The rest of the energy is lost in inefficiencies in the engine, drive train, friction, air drag, and in moving the weight of the car. These are all areas that have opportunities for improving gasoline mileage. We're only at the beginning. Even the weight of the car can be significantly reduced by using carbon fiber composites but strength and safety would still be the same. I believe it is quite possible to create an SUV that gets 40 miles per gallon in the city maybe even 50 with existing technology without compromising the concept of an SUV. (Note I don't like SUV's. I don't think they very functional, so don't think I'm pushing the SUV but they are great for towing.) I think its possible that cars can get 60 miles per gallon or even 100 miles per gallon. Just as we had a goal to get to the moon in 10 years, I would like to see a goal of 100 miles per gallon in 10 years. Too me its not much of a stretch. I would love to see that goal achieved.

I'm for plug-in hybrids like GM's Chevy Volt. Its not the car to save GM, but its headed in the right direction. The average American only drives about 40 miles per day. The Chevy Volt will run on battery power for 40 miles and then another 300-400 miles on its gasoline engine. Yes at $40,000 it will be ridiculous expensive. That's why it won't save GM, but VCR players, CD players, and DVD players were all around $1500 when they came out. Now they practially give them away with purchases of other electronics. You have to start somewhere to get to where you want to go. I think this is totally cool. What if CD players were rejected because vinyl records did just fine at a reasonable price. It takes vision to get there.

I think its cool that Honda has a hydrogen fuel cell car that you can lease now in certain areas that works totally like a regular car (Honda FCX Clarity). It has a range of 280 miles. Honda says "The FCX Clarity is not an experimental or prototype vehicle. It is a certified, assembly line-produced car that can be driven with both pride and confidence" Who even knew the technology was this far. Of course only the nuts in Southern California can lease this car for $600 a month. Not realistic pricing for the rest of us but its getting there. Where will all the hydrogen come from. The answer is natural gas. In fact Honda has been working with Plug Power, Inc. to perfect a hydrogen production unit at home that converts natural gas into hydrogen and also creates electricity for the home.

I think the front loading washing machines that use 20-25 gallons of water instead of 40 gallons are cool. That's a hugh savings. Do we need to use water more efficiently. Why not? Why not do everything more efficiently.

Am I a green nut?

Yes I have most of our electronics on power strips that I turn off before going to bed. It doesn't take much to do and I tried to make it easy on the family. Once they turn on one of the power strips for the day it stays on until bed time so everyone doesn't get frustrated turning things off and on. Everyone adapted immediately without any complaint. I was shocked. And since most days everyone is out for the day (school, errands, work), the power strips turned off at bed time usually don't get turned back on until late afternoon. That means this simple change keeps these devices completely off the grid 75% of the time each day.

Doesn't that sound green nutty? So I guess the conclusion is I'm green, kind of.

"No single raindrop believes it is to blame for the flood." - Despair.com

GM, Ford, and Chrysler

Let's face it. The three US car manufacturers still have a quality image problem. Whether their quality is really good now or not, the perception is still there. The other problem is their cars are boring, boring, boring.

They need to beat these perceptions and I think one way they could do it is to create an "iphone" like experience with their vehicles, dealerships, and service.

First, design vehicles that are more exciting and modern looking. Most of the US vehicles are plain and safe. The US manufacturers don't really ask their customers what they want. They just make their safest guess.

Second, let me specifically customize the car options I want online and place a order. And I mean really let me specifically choose options. No manufacturer offers this. You can't get exactly what you want. You have to buy "packages" that often have expensive things you don't want. Also, the manufacturers decide what options I can have. If I want leather seats and a satellite radio in a Honda Fit, don't tell me I have to step up to a Honda Civic. I don't want a Honda Civic, I want a Honda Fit. Don't tell me I can have any color interior in the Honda Fit as long as its black. I thought that went out with the Model T. Let people choose the options they want and stop playing the "package" game to "increase" profits. Let me order the car and deliver it fast in America not on a slow boat from China.

Third offer advanced technology. Ford is headed in the right direction with the Microsoft Sync system. Build cars that offer blue tooth cell phone integration, navigation systems, satellite radio, etc. Add intelligence for really keeping up with friends. Toyota had a team of young people design such a car that would keep you in touch but keep you eyes on the road. They employeed lots of speech recognition. Anyway do something and don't just offer it on the more expensive vehicles. Create excitement in the cars both on the exterior and interior.

Fourth make getting service easy and fast. Let me make a service appointment online and follow the status and cost online. Let me update my service profile information online. Let me see my full car repair maintenance log online.

Fifth, create customer rooms that are exciting. All car dealers miss out on major selling opportunities with their customer waiting areas. Have flat screen TVs that show cars and their features (no sound of course). Have computers available for web access. Set the default web page to engaging manufacturer web sites.

AND make all the online web technology accessible to mobile phones.

Let's all move into the 21st century please.

If the US manufacturers put some excitement into the customer experience, I think they can overcome their shoddy out of date image.

Tale of Two Cities

Until 2008, I had a 1995 Taurus and a 2003 Honda Odyssey. I had each serviced at their respective dealerships. The differences between the Ford dealership and the Honda dealership were like night and day. The Ford dealership was like walking into a third world country. The Honda dealership experience was first rate.

The Ford dealership reps didn't have computers, you got out of your car in a dark cold wind tunnel area, the waiting room was dingy with an old TV, shuttle service was one time, one way only, and if you needed any type of body service (leaky sunroof) they told you to hike down to the body shop where everyone just stares at you and ignores you. (After five tries they never did fix the leaky sunroof.)

The Honda dealership has a nice enclosed bright warm area for you to get out of your car. The reps have computers with complete information about your car and the parts inventory they have on hand for repairs. Oil changes are while you wait. They even wash your car at each service. The waiting room is bright and they offer coffee, doughnuts, free newspapers, and satellite TV. Plus the shuttles run often. (The little coffee maker at the Ford dealership finally broke and they didn't replace it.) The shuttle drivers give you their business cards which has their cell phone numbers on them. You can call them directly for pick up when you need a ride back to the dealership. The Ford dealer doesn't do pickups.

From which dealership do you think I would want to buy my next car.

To be fair the Ford dealership in the final days I owned the Taurus did finally enclose an area for you to drop off your car. The reps now have computers at the drop off point, but not much else has changed. The customer waiting area has been about to be remodeled for over an year. Still nothing had happened at the time I sold the Taurus. The coffee machine was still broke, the TV was on its last legs, the furniture was still deterioating, the magazines and car brochures were from a prior year. The feeling of yuck was still strong. I did not consider a Ford for the replacement of the Taurus.

The 1995 Taurus had been a very sound car mechanically, but the rest of the car was mediocre. Knobs fell off, the sunroof leaked and couldn't be fixed, and other things failed. And I couldn't stomach the dealer any longer.

I hope things improve for the US car manufacturers but a lot has got to change if they're to survive.

Nancy and Harry

Article: Commentary: Stimulus bill a sorry spectacle

"It's really too bad President Obama couldn't figure out a way to jettison these two who are poster children for everything that is wrong in Washington. "

I thought this quote from the article above was funny regarding Nancy Pelosi and Harry Reid.

They're really doing their best to help President Obama fail. Right now it appears to me that Nancy and Harry are more powerful than President Obama. I hope he stands up to them soon and follows a more powerful centrist agenda.

Google Flu

Article: Tracking the iPhone’s bubble of hype
Article: How does this work?

From the first article...

"Google Trends is a powerful tool. It has been used, most famously, to monitor influenza outbreaks by tracking flu-related Google searches — a epidemiological early warning sign that turns out to be more prescient, by two weeks, than the U.S. Centers for Disease Control’s surveys of 1,500 hospitals. (Google explains its methodology here, with a link to an article in Nature.)"

Makes sense that tracking what people are searching for in real time could be an early warning of flu epidemic but who would have thought that it would be better than the U.S. CDC's method by two weeks.

Interesting... I wonder what other nuggets are out there.

Huh???

Article: America's Emptiest Cities

According to the article above. Greensboro is the 4th emptiest city in America per the U.S. Census bureau. If you leave out apartments, Greensboro is the 2nd emptiest city in America.

Las Vegas and Detroit lead the list but you can see that in the news video's of the many streets loaded with For Sale signs in those cities, but I don't see that here at all. There must be a mistake in their methodology.

Bizarre...

About Fort Bragg...

I mentioned being stopped by security forces at Fort Bragg in my skiing post. Of course that requires a story.

My son's troop and I went to Fort Bragg for a weekend last year. When you arrive at the entrance, everyone must exit the vehicle, open all doors, open the engine hood and the trunk. All adults must hand over their driver licences for background checks. The entrance guards who are wearing guns search the vehicle and engine I guess for bombs or whatever. Its an interesting site to see. So I thought I would take some pictures. WRONG!!!.

When a guard saw me taking pictures, he immediately stopped me. Said he was supposed to hold me for questioning. He was not kidding. He evaluated the situation and decided to have me go through every picture on my camera and delete the pictures I had taken at the entrance. I was relieved that was the satisfactory conclusion to the incident. Anyway everyone had a good laugh later at my expense.

We had a great weekend. We got to meet with the military bomb squad who allowed us to experiment with bomb disposal robots which cost $250,000 a piece. There were three guys in the unit on duty. The officer was probably around 28-30 years old. The other two were around 24 years old. These guys get called out every week to go somewhere to dispose of suspected bombs. Very sobering to see people so young doing very dangerous jobs. In fact the base had just lost one of the bomb squad in Iraq that week. We saw the parachute practice run area. We didn't get to actually do the practice because too many soldiers are away in Iraq and Afganistan. Like I would really climb the tower and go down the wire.

At times, I felt like we were in Iraq as we saw military hummers with a soldiers sticking out of the top with mounted machine guns. I think they were going to military exercises.

We saw the airborne museum and I was very surprised to see a very large glider made of canvas and light framework that was used in World War II to deliver troops and equipment to the front. These gliders could carry over 4000 lbs. (see this site for details http://www.exploringthenorth.com/gliders/history.html). I had never heard of this.

We went bowling on the base that night. It was a lot of fun. They turned off all the lights at the bowling alley and only had black lights illumating every thing. It was like one big party on a Saturday night. Soldiers, their dates, and families were all there having a great time.

We ate every meal on base eating in the same cafeteria as the soldiers. I did see one funny site. A woman soldier went up to a guy soldier, both dressed in full uniform, and gave each other a big hug. They appeared to be boyfriend and girlfriend. I just thought it was funny, nice, but funny. I'm not used to seeing soldiers in uniforms give hugs. It was cute. Both were very professional just funny to see.

I stayed out of trouble the remainder of the stay, but one of the cub scout Mom's told me of her recent visit a couple of months ago. She had heard about my getting in trouble through the grape vine and wanted to share her recent incident.

She and her 10 year old son went to Fort Bragg for him to participate in an ice hockey competition on the base. She somehow missed the main entrance, but saw a small entrance to the base. There was one soldier sitting in the booth at the entrance. She didn't know if she was supposed to stop or not. As she drove told the entrance, the soldier didn't get up and motion in any way so she drove on. Definitely WRONG unfortunately!

After she passed the entrance, several hidden military vehicles took off after her with lights and sirens blaring. She quickly realized she should have stopped and pulled over. She figured they would talk to her and then she could go on. The soldiers poured out of the vehicles with guns drawn. They got her out of the car and had her hands on the hood. She thought they were going to search her. Next thing she knew her hands were handcuffed behind her back as she laid down on the hood. They got her drivers licence and were doing a background check. She kept looking at her son in the car who was looking more than a little concerned. As the soliders sized up the situation, one of the soldiers said take the cuffs off before you freak her kid out. They established her identity and purpose and then let her go with an apology but with a reminder that they have to do their job. She recovered quickly but will always remember this somewhat funny event.

Nice to know though that our forces are on the job.