UFBF File -- $700 Billion

What percentage of the population do you think knows what the problem really is? I am reasonably intelligent, and it is very tough to figure out why we are in a crisis, what exactly the crisis is, and how come if the crisis is so near we aren't seeing breadlines and brokers jumping out of windows.

The problem with leverage is that it levers both ways. When one dollar of real estate, say, is propping up $100 borrowed to play the market, and that real estate is now worth 80 cents, or 70 cents, or 50 cents, you are now only allowed to borrow $80, $70, or $50. If you can't pay back the $20, $30 or $50 difference when the lender asks for it... Margin call, and big problems! This is especially true when you have no idea how much that dollar declined to -- is it only 50 cents? Could be zero! Let's pull the plug and call all the funds!

The problems are: 1. these guys bought real estate mortgages as securities and actually believed the seller that the real estate backing them up was sound, and 2. they then borrowed tons of money against these "securities" to buy other securities, many of which had the same problem.

That, to me, is a basic understanding of the problem. The bailout is being sold as a way to stabilize the value of these bad securities -- to actually put a value on them, so that instead of not knowing if the $1 in real estate is now 80, 70, 50, or 0 cents, because no one is buying them, the government will buy them at one of these numbers, thereby fixing the value, at least for the bank, and letting the bank take its hit and move on. The government thinks that $700 Million will cover it.

What happens if the gov't does not do this? Personally, I think it will be a deflation, or depression, and it will take years to recover, as these unstable "assets" are defrayed and the level sets to their real value. Or, it could be a hyper-inflation to cover the effects of the depression.

It will be hard to borrow money. Might be hard to make money since it will be harder for companies to borrow to grow, or even to get investment money. It is hard for me to envision.

Is $700 Million enough? I don't know. Did you know there are over 60 T-T-T-Trillion dollars of insurance written in credit default swaps? Unf-ing believable.

How the hell did this happen? Greed and stupidity. Actually, if you recounted the seven deadly sins, every since one of them were indulged in by those that were parties to this, and it is not just the banks or brokers. Those that borrowed 100% for adjustable interest-only mortgages, those that bought houses on "spec" to "flip" at some insane increase of value (the bigger sucker principal). People without jobs or prospects buying houses based on a belief in magic that they will be able to pay them back (or sell the house for some insane return in the next week or two). Real estate pros who were incented to sell as high as possible to get their 6% commissons. Mortgage brokers who were incented by big closing fees to close the deal. Home lenders like Countrywide who bought these mortgages without doing due dilligence (they call it due dilligence for a reason!). Wall street who packaged all these mortgages into "securities" and sold them to investors who, again, did not do due dilligence on these component loans.

I saw the end of the bubble years ago. I knew it would be bad, but I suspected something like the early '90s where some people were hit bad by it, but we all lived. I had no idea that it would result in this.

Samuel Whittemore, from 1775

I was cleaning out my office and papers over the weekend, and came across a card that I wrote about eleven years ago. I was working in the Boston area, and in the evenings I liked to explore around.

I always had a passion for the American revolution. Growing up near Philadelphia only made it easier to indulge in a subject that already suited my anti-tyranical and libertarian leanings.

One night I was walking in Arlington, Massachusetts. Arlington is one of the small towns just outside Boston, near Lexington, Concord, and other towns that collectively were the birthplace of the American Revolution.

I walked by a park, and noticed a stone monument. It read:

"Samuel Whittemore, then eighty years old, killed three British soldiers, April 19, 1775. He was shot, bayoneted, beaten, and left for dead, but recovered, and lived to be ninety-eight years of age."

After reading, I couldn't help but blurt out aloud: "Now that's a Man!"

It's these things that capture my imagination. Think about it: Here is a man, eighty years old in 1775. Eighty. 1775. What does that mean in those days? No walkers. No Meals on Wheels. Wooden teeth, if any at all. No Lipitor or Geritol. If you were sick, they bled you or gave you some other Ungodly "treatment." No antibiotics. No ice! No knowledge of clean hands before surgery, nor of using any kind of antiseptics -- "antiseptic" was not even a word. He was shot. Beaten. Bayoneted! And lived. My God. He died at ninety-eight! I want his genes!

On top of that, I had this picture in my head of an old fart with a trusty flint-lock taking aim those red-coated soldiers, muttering as he was firing "take that, you British bastards! Get the hell off of my land!" I could hear him say after the last bayonet jabbed him "it's only a flesh wound! Come back here you cowards!"

If you put this guy in a movie, no one would believe it. What a man!

As I started this post, I decided to Google him -- and what a story. Turns out he was the oldest combatant in the Revolutionary War. April 19, 1775 was the first day of the Revolution -- the shot heard round the world was shot that morning in Concord.

You know, it is important to remember that this country is not here by accident, that it took a lot of guts and blood to establish the USA and keep it here. The US has had many faults and sins, but they are faults and sins against a standard no other country even advocates, let alone adheres to. When we had slavery, we also had the Declaration of Independence, which states that all men are created equal. The lofty idealism of the Declaration beat out the base cruelty of slavery. There are people and interests from across the political spectrum that take shots at the Constitution, from universities enacting speech codes to cities enacting gun control to presidents suspending habeas corpus. Despite the onslaught, the rights remain, because they are so ingrained in our collective psyche as Americans and because we are diligent about pointing out and eradicating transgressions against them. So here's Sam Whittemore, at the dawn of our country, showing what it took to get it done and get this standard established. We need to keep that in mind.

Quotation from my Wife

"With self-improvement there is forward movement."

Shades of Jesse Jackson-style rhyming, but so true.

The Way to Tech Nirvana

RTFM
FFIO

That's it.

My Lad

I wish that I can be half the person my son thinks I am. There is nothing better in the world than having the unconditional love of a child.

Comment on Starbucks

There really is no doubt that Starbucks started the whole decent coffee trend in the US back in the early nineties. Sure, you could find good coffee if you knew what it was and you lived in a place like San Francisco, Los Angeles, or Seattle, but basically, "coffee" was the crap you got at the local diner, or the crap you got from a can.

So, despite the super over-expansion of Starbucks in the last few years, I tended to have a soft spot for it. I knew that I could go there and despite the other crap they added to their menus, I could get a good cup of coffee. Sure, I had to start specifying the "bold" roast instead of their insipid "breakfast blend" and other weak-sister appeasements to those who should be drinking at McDonalds, but I could get it.

I noticed in the last year, year and a half, when I did go to Starbucks, I started getting bad coffee. Not just not what I expected. Not just weak. But bad. Basically undrinkable. This was inconsistent at first. I would try again, and the next time, it would be a bit better, and still above the bar as drinkable. However, in the last few months, that changed. Even after Schultz closed all Starbucks for a few hours to "trained in creating the perfect shot," the coffee still as bad -- actually, that is when it became consistently bad.

Shultz started his reorganization of Starbucks in January, and said he was going to, essentially, go back to basics: great coffee. And, stop selling the re-heated breakfast food.

So, what happened?

First, the coffee is bad. Undrinkable. I actually got my coffee this morning from Panera, which is right next to Starbucks, because I knew that Starbucks would not be better, and Panera has great scones.

And, in one of the most obviously commitee-driven chicken-sh* decisions I have ever seen a major corporation do... Well, here it is, verbatim from the Wall Street Journal:

"Starbucks Corp. plans to keep selling warm breakfast sandwiches at its stores and will change their recipes in an effort to minimize their smell, the company confirmed Friday."

That is the final nail. Starbucks is officially dead. All they really have is coffee, and that is now as bad as the stuff I used to drink before Starbucks changed the world. And now, their "management" can't even pull the plug on one of the most bone-headed decisions they made as a company.

Now, I'm a Peets man - have been for over thirteen years. The coffee cups have the same motif as 1994. They play classical music, just like in 1994. They have the same sizes. You go into a Peets, and you know you are not only in a coffee place, but you know you are in a special coffee place. Peets kicks you in the ass; it is great coffee.

Starbucks was a close second, to me. Their French and Italian roasts were excellent, and on par with Peets. But, now you get "Pikes Peak Blend" which might as well be pushed by Mrs. Olson.

It's really too bad. Why does quality have to suffer when going mass-market? Why do executives lose their balls when companies get big? They can claim "bacause we'll lose money!" or "the risk is too high!". Bull-sh*. Starbucks is dead, and declining. This is a lesson in how to kill a brand. Cheapen the hell out of it, and watch it die.

More People is Good

From my point of view, more people is a good thing. As a percentage, people generally are good hearted rather than evil. As a percentage, more people not only pull their weight but add much more than they take. The percentage of people who take are lower than the percentage of people who give.

Let's say that 80% are good, creative people. 20% glom off the rest. A very small minority are actively hostile or evil. Therefore, if you add ten people, you have eight people doing good things, outweighing the bad the other two people do.

Of the eight people who are doing good, one or two of them do amazingly good things, like cure cancer or invent rocketry or create masterpiece art. The great inventions are individual, not committee-driven. All art is created by amazing individuals, not masses.

Because of this, I am not worried about the global population. We add a million people, we add a few thousand incredibly brilliant people who change the world for the better, and hundreds of thousands of great people who add to life on this orb. To my mind, this outweighs the few bad apples.

Can we feed them? Well, we always have. Smart people figure out how to feed themselves and their families, and so doing, figure out how to feed the rest of us.

And, I believe I have proof that I am right:

There are more people living now than have ever existed, and

We have the best overall living conditions that we have ever had, and

We know more than we have ever known before.

Yes, there is plenty of evil, cruelty, and pain in the world. Yet, despite the evil in the world, Good is winning. And Good is winning because as we add people, we out-number bad people more and more and more.

UFBF... Again

So, this blog is not about things that are just unbelievable, but, on the other hand, some things just need to be pointed out as asinine.

In this case, it is that Hillary Clinton and her supporters want Obama's supporters to pay her debt, debt she incurred trashing Obama and continuing her campaign way past the point where the fork came out clean. I do not get this at all. Since when does the loser get paid for losing? And by the winner?

Is Clinton so insensed from losing that she is trying to derail Obama with these distractions? Is this another case of the crabs in the bucket that keep pulling at the other crabs trying to get out?

The goal, I think, for any Democrat out there, must be to put everything else aside except getting Obama elected. Second priority would be to keep the congress. But some of Clinton's followers are just plain crazy, and are actively working to take down Obama. Here are two samples of the vitriol and hatred that's out there. They cry sexism. Perhaps there is just a hint of racism and misandry here?

Personally, I think we could survive an Obama presidency, but I would not like it, mainly because Obama's politics have been pretty straight-ahead old-school Democrat. He reminds me of McGovern. But, he has the potential of a Kennedy or a Clinton (Bill, anyway) to be more than the usual Democrat. If his positive comments re Reagan are an indicator, he may prove to be a surprisingly moderate unifying president. If he is elected, I hope he is.

UFBF File 2: Statins for kids?

In the New York Times, the doctors are saying that kids as young as eight should be on Cholesterol lowering drugs. Of course, this is for the obese kids. How'd these kids get obese in the first place? Cokes, Candy, Big Macs, TV and Video Games. But, hey, they are not selling enough Lipitor (the #1 selling drug in America), so drug 'em up.

From the UFBF: SF Frees "Undocumented" Crack Dealers

An entry for the UFBF (Un-... Believable! File):

San Francisco has its priorities out of whack: "protect" illegals from the feds, even if they are arrested crack dealers!

I don't care what your political leanings are, this is just plain insane.

Bo Diddley RIP

I just spent some time listening to Bo Diddley and his influences on Sirius Disorder (Channel 70). It's amazing how much the "Bo Diddley Beat" is incorporated into our core, and how much he defined rock and roll. Who do you love?

Just updated blog settings and "widgets"

Well, I thought I'd add some new tricks to this blog. I put in place some "hacks" I read about from Blogger's blog. Some of these are really slick -- Blogger is proving to be the best platform for blogs (at least for me) since I would rather focus on content than form.

Cyber Echoes

On the one hand, I know no one is reading this as yet. Echoes in cyberspace. On the other hand, to write entries as if these were private musings is to invite disaster (not that my private musings merit disaster, but you never know...) The one time I slip and unintentionally slight some group or another, or someone or another, is the time these writings show up on Page One.

Personally, I am of the opinion that we should expect whatever we do to be fully in public view. It is not desirable, but on the other hand, I'm not hiding anything from anybody. As Lynyrd Skynyrd says (or, really, J. J. Cale): "I ain't hiding from nobody/ Nobody's hiding from me." I always thought of that being a great line. What is bliss, really? Not living in fear of being caught, and not obsessing over catching anyone else. Peace, in other words. If you are living totally in peace, who cares what people see?

Flight of the Queen Bee

This poem by EB White was published in The New Yorker in 1945. This is one of my favorite poems -- funny, but with stiletto-sharp social commentary.


SONG OF THE QUEEN BEE
EB White

"The breeding of the bee, says a United States Department of
Agriculture bulletin on artificial insemination, "has always
been handicapped by the fact that the queen mates in the air
with whatever drone she encounters."

When the air is wine and the wind is free
And morning sits on the lovely lea
And sunlight ripples on every tree,
Then love in the air is the thing for me--
I'm a bee,
I'm a ravishing, rollicking, young queen bee,
That's me.

I wish to state that I think it's great,
Oh, it's simply rare in the upper air,
It's the place to pair
With a bee.
Let old geneticists plot and plan,
They're stuffy people, to a man;
Let gossips whisper behind their fan.
(Oh, she does?
Buzz, buzz, buzz!)

My nuptial flight is sheer delight;
I'm a giddy girl who likes to swirl,
To fly and soar
And fly some more,
I'm a bee.
And I wish to state that I'll always mate
With whatever drone I encounter.

There's a kind of a wild and glad elation
In the natural way of insemination;
Who thinks that love is a handicap
Is a fuddydud and a common sap,
For I am a queen and I am a bee,
I'm devil-may-care and I'm fancy-free,
The test tube doesn't appeal to me,
Not me,
I'm a bee.
And I'm here to state that I'll always mate
With whatever drone I encounter.

Let mares and cows, by calculating,
Improve themselves with loveless mating,
Let groundlings breed in the modern fashion,
I'll stick to the air and the grand old passion;
I may be small and I'm just a bee
But I won't have Science improving me,
Not me,
I'm a bee.
On a day that's fair with a wind that's free,
Any old drone is the lad for me.

I have no flair for love moderne,
It's far too studied, far too stern,
I'm just a bee--I'm wild, I'm free,
That's me.
I can't afford to be too choosy;
In every queen there's a touch of floozy,
And it's simply rare
In the upper air
And I wish to state
That I'll always mate
With whatever drone I encounter.

Man is a fool for the latest movement,
He broods and broods on race improvement;
What boots it to improve a bee
If it means the end of ecstasy?
(He ought to be there
On a day that's fair
Oh, it's simply rare
For a bee.)
Man's so wise he is growing foolish,
Some of his schemes are downright ghoulish;
He owns a bomb that'll end creation
And he wants to change the sex relation,
He thinks that love is a handicap,
He's a fuddydud, he's a simple sap;
Man is a meddler, man's a boob,
He looks for love in the depths of a tube,
His restless mind is forever ranging,
He thinks he's advancing as long as he's changing,
He cracks the atom, he racks his skull,
Man is meddlesome, man is dull,
Man is busy instead of idle,
Man is alarmingly suicidal,
Me, I'm a bee.

I am a bee and I simply love it,
I am a bee and I'm darned glad of it,
I am a bee, I know about love:
You go upstairs, you go above,
You do not pause to dine or sup,
The sky won't wait--it's a long trip up;
You rise, you soar, you take the blue,
It's you and me, kid, me and you,
It's everything, it's the nearest drone,
It's never a thing that you find alone.
I'm a bee,
I'm free.

If any old farmer can keep and hive me,
Then any old drone may catch and wive me;
I'm sorry for creatures who cannot pair
On a gorgeous day in the upper air,
I'm sorry for cows who have to boast
Of affairs they've had by parcel post,
I'm sorry for man with his plots and guile,
His test-tube manner, his test-tube smile;
I'll multiply and I'll increase
As I always have--by mere caprice;
For I am a queen and I am a bee,
I'm devil-may-care and I'm fancy-free,
Love-in-air is the thing for me,
Oh, it's simply rare
In the beautiful air;
And I wish top state
That I'll always mate
With whatever drone I encounter.

Religious Nuts

We're not going to get anywhere if we continue to repudiate people for saying or believing stupid things. This country was built by religious nuts with guns. We should celebrate the Rev Wrights and Rev Hagees and Minister Farrakhans of the world - they spice up the place and keep out complacency.

Blip

Even if we are only a blip on the edge of the universe, we are the only blip.