Thursday, August 31, 2006

Leading indicators

Courtesy of the Big Picture, I present the leading indicator for the economy.

Builders’ sentiment is -52.2% YOY
New-home sales are -21.6% YOY
Purchase-mortgage applications are -20.9% YOY
Building permits are -20.8% YOY
Housing starts are -13.3% YOY
Existing-home sales are -11.2% YOY
Existing-home inventories are +39.9% YOY
New-home inventories are +22.4% YOY

Are you better off?

Are you making 16% more than you did six years ago? Is that after inflation - are you really making 25% more?

According to the bea, GDP has increased over 16% since 2000 (looking down at index numbers where 2000 is used as "100").

Are you spending 19% more after inflation than you did six years ago? 30% more after inflation? Has your income gone up 30% since 2000? Same chart, same modifiers.

If your spendable pay is less than a 30% increase over 2000, then someone else's is more. I'd strongly suggest taking a few minutes to think about who, and why, and maybe what you can do about it. Me, I'd suggest voting for someone who isn't in favor of making the rich richer while the poor get poorer. But you jump the way you want - you're a thinking person, you'll figure out something.

The war we're in

So I've been trying since before the last post to write a better strategy of fighting terrorism. And I finally figured out why it's so hard.

Because it won't be followed, and as a consequence we're going to get further and further behind the curve. And it depresses me a lot.

Amusingly, recognizing that seems to have freed me up to write. Here's the broad outline:

First and foremost, it's a social war - a war of philosophies and principles. Most accurately it's exactly what Bin Laden recognized it as being: a war of cultures. We want our culture to supplant that which is supportive of the organizations and people opposed to us.

Second, terrorism is a tactic, not a way of life or a strategy. Letting it dominate the focus is a good way to let ourselves be led by the nose. Focusing on the "terrorists" is wasteful and encourages misdirection. It's like focusing on artillerists. Yes, I definitely like that last analogy - it's an almost perfect match, with the bonus of demonstrating the STUPIDITY of the focus.

For these reasons, we need to begin by reorienting our strategy. We need to recognize again that our foes are global insurgents. Their objective is to put all the world - or at least as much as possible - under the rule of their preferred form of government. That form is Islamic in basis - a very totalitarian (and patriarchal and 'fundamentalist') form as initially outlined by Sayyid Qutb. A significant intermediate objective is establishment of the 'Islamic Crescent' that never was - that is, re-establishing Islamic rule in every nation that was once under Islamic rule, regardless of when that was. Their model is decentralized - each nation's insurgencies are cooperative but not coordinated. There are regional and global 'franchises' that aid the cooperation and provide support through training, financing, transportation, and other functions depending on specialty.

Due to the international nature of this insurgency franchise, all nations and cultures - even those with no current active insurgent base - are part of the battlefield. In fact, as one necessary focus of the battle is hearts and minds, those nations are significant. It's necessary to demonstrate that they are irrelevant, or that they're not really different, or that they're REALLY the bad guys. And they, in this case, is in particular the United States.

We have to look like -- and BE -- the culture everyone envies. That's a key step. We have to mean it when we declaim, "ALL men are created equal" - when we speak of upholding basic human rights and rule of law, we must hold ourselves to the same standard. That's a starting point.

As for the war on the insurgents themselves, well, it's basic counter-insurgency work. Which is to say it's long and hard. In general it looks a lot more like law enforcement than it does military operations. Actually, like law enforcement working with 'humanitarian organizations'. Military operations inevitably create martyrs. They give the insurgents an anchor - an event at which they can point and declaim "THIS is what and who we oppose." Military operations cannot be completely sidestepped, however. In fact they're sometimes going to be exactly what's needed to quell a particularly sharp or significant offensive by the insurgents. But the force must be carefully focused - precise, with an absolute minimum of collateral damage. Generally this will mean bullets over bombs.

I'll write more on this - in particular, where I think we need to go in regard to Iraq and Iran (separately, mostly). But that gets the basic block out of the way.

Saturday, August 26, 2006

can't stop cooking

I have a serious and long post in the works, really I do. It's about Iran and terrorism and all that and what I think we should do and all that and... and I got hungry.


Minor tips for cooks.

Hot Stuff. An amazing number of meals work better if the dishes are hot or cold. I'm going to give an example recipe near the end of this post, but this is about the dishes. Now, the most advice I've ever heard is to put your plates or other dishes into the oven (on low) for a period of time to heat them and keep them hot. The problem is, at least for me, if the oven's going I'm using it to cook. My solution is to put a small amount of water into the dish and put it in the microwave. Yes, it works with plates too - and you can stack them (though I recommend putting down a toothpick under the edge of each plate - the space will allow steam to escape more easily.)

Timing with Sauces. Sauces - gravies, glazes, and many others - have this problem with timing. They tend to fall apart or solidify while you're waiting for everything else to get done. And they need so much attention that it's hard to do anything else. So you wind up with everything else a bit cooler, or your sauce not-so-good. My favorite solution, learned from a restaurant cook way back when, is a soup thermos. You know, one of those broad-mouth 2-cup thermoses you put the kid's soup in for school. Yes, the narrow neck ones are 'better', and the steel looks and wears better. But the wide neck has two advantages. First, you can dip into it to get all the sauce out. Second, it's a heck of a lot easier to clean. Regardless, you can make your sauce first, set it in these, and plate it at the last second - the perfect instant, most of the time.

OK, I promised a recipe. It's a variation on one from Mark Bittman's "How to cook everything: Bittman takes on America's Chefs. At heart it's dirt simple:
Boil noodles.
Put pieces of ham in bowl
When noodles are done, drain and put on top of ham.
Add some butter.
Crack an egg over the noodles and stir or toss.
Top with a little grated cheese.

The heat from the noodles will cook the egg, but in the process it can really suck the heat from the noodles. I do two things to help it along. First, I heat the bowl (see, there's that tie I promised). I also drop the egg into the noodle water about 30 seconds before they're done. The water warms the egg.

Oh - Bittman's recipe uses more pans since he actually fries the egg sunny side up in butter, and adds the resulting browned butter as well as the egg. Browned butter adds yet another layer of very good taste. But it's another pan for me to clean.

Now it's worth noting that this isn't the first time I've seen the 'raw egg on hot stuff, stir to cook in the serving dish' trick. I had a scotsman do it with oatmeal, and a japanese friend drop a small egg into a bowl of hot broth-based soup (sort of miso but not really). This, however, puts a nice even coating on the noodles - enriching them slightly.

Oh - as Mark Bittman notes, if this is too dry you can add a bit of the hot water from the noodles (if you reserved any). You want a bit of a sauce - but since it's made from the ingredients in the bowl there's no need to open the thermos.

Friday, August 25, 2006

Use the Schmaltz

Last post we made broth, and oh-by-the-way schmaltz. Now I know at least one commenter is repeating the palpitations brought on by my use of bacon grease, so let me pause and say it again:

It's not what you eat, it's how much of what you eat that matters.

Schmaltz, like bacon grease, is a case in point.

I have two favorite things to do with schmaltz. Hopefully mentioning them will give you ideas - ideas not only for the schmaltz but for other rendered fats as well.

First and without any doubt my favorite: roux. Now I'm the longwinded type, so I'm going to assume you're not certain what roux is, how it's use, or even why.

Roux is a thickening ingredient. It's a critical component in several dishes, not least of which are gumbos.

Starches are a common thickener. Cornstarch, arrowroot, and flour are frequent choices. Each has advantages and disadvantages, but we're going to focus on flour. Flour thickens wonderfully, but raw it's got a nasty taste. However, it browns and flavors divinely. A roux is equal parts flour and fat cooked to brown the flour. Now the darker the roux the richer the flavor. On the other hand the darker the roux the worse the thickening. Classically a roux is made from butter, which as it happens brings surprisingly little flavor to the roux. Enter schmaltz.

Ah, yes, you can see where this is going. One of those cubes, melted, and a tablespoon of flour, and you're off and running for your roux. Except it's got a powerful chicken flavor even when the roux's light in color. Mix the roux, cook it for a couple of minutes, and thicken a cup or two of broth by pouring it into the mix. You can also pour in milk - that's 'cream' gravy. If you're serving it beside a chicken dish your flavors are quite strong - heh, and I tend to get lots of raves about this gravy.

Now as it happens there's another dish we're fond of in our house. It's one that I got told after I'd been doing it a while is hard to do - bull, frankly. I speak of risotto. Let's make a batch -- a BASIC batch.

You need:
1 tablespoon of schmaltz, and another of olive oil or butter (your preference).
1 cup of rice.
4 cups of chicken broth - which probably won't all get used.
1/2 cup parmesan cheese.
A saucepan for the broth, a larger pot for the main cooking.
I also use a wooden spoon and a half-cup ladle.

Get the broth hot - I bring it to a simmer - then turn the heat down to keep it warm but not hot enough to evaporate.

Warm the large pan over medium hot heat and add the fats. When they're melted, add the rice and stir till all the grains are coated. Lightly brown a layer of rice, and turn the heat down to medium low. Add two ladle-fulls of broth to the rice (warning - steam blast), and stir thoroughly.

Now the pros will tell you to watch and stir constantly. Bah. here we go.

Shake the pan enough to cause the grains to self-stir for about 20-30 seconds. Use your spoon to push any grains that have climbed the side back into the broth. step back and do other stuff, checking the rice every couple of minutes or so. When you can't see any liquid - it's been absorbed/evaporated enough it's below the level of the rice - add another ladle, stir thoroughly, shake, push down. Continue till done.

Done? Here's the measure -- done depends on YOUR taste. I happen to like my rice soft. Some people consider it overcooked and go for al dente (so to speak). It's your rice, cook it to your taste. When it starts looking right, spoon out a small bite and try it. Oh -- you might not use all the broth. Or you might use it all. Even once you have 'your taste' the amount will vary depending on things like humidity and altitude and, well, all that sort of thing.

Anyway, pull the risotto off the stove and stir in the cheese. And serve.

OK, I said basic. Saute some onions just before you brown the rice. Add some shredded chicken with or instead of the cheese. Throw in some vegetables. One key thing, however: the schmaltz is going to make this have a strong chicken undertone. If you want to add something that doesn't sit will with chicken - say, crab meat - then don't use schmaltz. And the same goes for the broth - use an appropriate liquid. For what it's worth I have made a broth risotto with water. The lack of flavor was a bad thing though I can think of some additives that would have worked well, but its consistency was exactly what I'd intended.

Go eat.

A necessary tool

Another cooking post. Actually, two more. I've got a longwinded one coming, but it's not gelling the way I want. Since I want to get SOMETHING down...

One of my most-used kitchen tools is my crock pot. Oh, sure, there's the six hour chicken and all that sort of thing, but I depend on it for something significantly more important: my stock and my schmaltz.

Buy - butchers quit giving them away a LONG time ago - backs and wingtips. Note that if you're willing to do the work you're better off buying whole chickens, processing them for breasts, thigh quarters, and 'buffalo wing parts', but I'm lazy and these parts aren't THAT expensive. Anyway, buy enough to fill your crockpot halfway.

Now add a tablespoon of acid - I use white vinager. (I've used rice vinegar, I've used other vinegars and citric acids and even a few other things, and in the end you just can't taste it. So this is a time when you go with the cheap stuff.) IF YOU WANT, add some rough chopped onion and celery and carrot and anything else you want flavoring your broth. Me, just the vinegar as it gives me more freedom in the end. Anyway, fill the crockpot up to an inch short of the top. Cook for, well, now it depends. You want the broth to be rich. But after a point you start adding complex flavors from the browning of it all. And if you go too long it tastes burnt. So in the end, your first time you should cook it for four hours, and then taste it every half hour or so till it's what you want. For my taste and pot, eight hours is right.

Have a large pot or bowl with a collander in or on it - it's got to be large enough to hold the contents. Have a cooler large enough to hold this pot that's filled about 2 to 4 inches deep with ice, and have some small CLEAN jars that were half-filled with water and then frozen standing by as well. Back to the collander - if you've got cheesecloth or a mesh strainer I recommend using as an additional layer of catching. Pour everything into the (lined?) collander. Lift out the collander and get more moisture out. This surprisingly soft mass can go several places including compost, but I have an animal problem if I put meat remains out so it's into the trash. For the rest, the bowl goes into the cooler, a couple of jars go into the liquid, the lid gets closed, and I go away for half an hour.

An interruption - this isn't how I used to cool my broth. I used a much more complex system to try and get through the danger zone of 140 to 40 degrees. Credit where it's due, I learned this from Alton Brown's Good Eats, the episode in which he makes stock. Back to work.

Now take a moment to look at the broth. It should be gelatin now. If it's not, you didn't cook long enough in the crockpot. Remember this for next time, put the broth into a pan to boil and reduce by a quarter or so, and cool it again. Anyway...

If it IS gelatin, you've got three layers sitting here. On the top is chicken fat aka schmaltz. Just like bacon grease, I'm going to tell you DO NOT THROW IT AWAY. Like bacon grease and GOOD olive oil, the flavor compounds in it make this pure culinary gold. I put the disk into a saucepan, melt it, and pour it into an ice cube tray - each 'cube' about half full. This gives me a bunch of chunks of about a tablespoon in size. I wrap each in foil, then they all go into a plastic bag that gets labeled "SCHMALTZ" and the date of creation. Oh - throwaway date for these is one month. I've used them at two and they're OK, but at three even with the double protection they're beginning to get odd tastes. And at the rate I go through broth, there's always plenty to throw away.

Now that the schmaltz is gone, I turn the bowl over onto a platter. And I use a somewhat sharp object - a table knife is good enough - to cut off the bottom. This part's real easy to see as it's full of the little chunks of solid that were too fine for the strainer. Now, you don't have to remove this. But if you keep it, whenever you make something with the broth it's going to have those chunks floating. It's an appearance thing, really. My wife can't stand the looks, so this becomes a bonus for the pets. The rest gets melted again (yes, possibly a third time) and poured into freezing containers of one and two cups. These containers go into the cooler WITHOUT the jars - they're small enough that the exterior ice seems to be enough for rapid cooling - then when solid again they get a layer of plastic wrap and a lid, and finally a label: chicken broth, date.

I don't think the crock pot is the FIRST cooking implement I'd send to a college student (that's actually an electric skillet), but it's high on the list. And just for the broth it's worth the price.

Wednesday, August 23, 2006

How to inflate

As I said in predictions, I expect to see a few months (no more than six) of depression that trends deflationary (monetarist definition) followed by a couple of years of high but not hyper inflation (still monetarist). The hurdle for that scenario is how to get created money into the hands of the public. Wages are flat, and the public willingness to increase debt (refinance homes, buy more on credit, etc) is just about tapped out.

So far I've come up with two 'broad' options, both with numerous variations.

Method one continues the credit. It's via a 'debt relief act' or instrument or some such. Probably not a tax credit as that's too slow (unless retroactively applied as the previous 'tax rebates' were applied). No, something that says "if you get more credit you get money back". Think of it as an extension of the Discover 'moneyback' method.

The second method was sort of mentioned already. The government goes on a massive spending spree - well, moreso than it has already. It can be for an internal or external critical issue - recovery from Katrina exemplifying the first, and the "great war on terror" the second. Either way, the government gets LOTS of people providing goods and services it needs to "do the job". Preferably in such fashion that they encourage and feed pick and shovel businesses. Ummm, pick and shovel. In mining rush towns, a few miners got rich. But most businesses that supported miners got rich. Sell the pick and the shovel they need but don't have and let the darn fools gamble on finding gold or silver.

I can't break form, I have to use more words (grin). There is a third way - a variation of the second. Instead of contracting for the people, hire them. Increase THEIR wages. How? The fastest and easiest way I know to massively increase the number of government employees is through a draft. That there are numerous painful obstacles to that for the government to do it is a given. I'm just pointing out the technique.

Draft, 'massive rebuilding program', 'massive reaction to external threat', and some sort of debt relief act. Any of those three and it's time for the high inflation - change assets accordingly.

Pondering ACLU v NSA

I chose to wait on responding to this till I'd actually taken time to read it. Oh, and read the supporting documents for it. I like to think it makes my untrained (IANAL) opinion my own more than that of the various pundits regurgitated.

Before I comment on the opinion, I'm going to note the one extraordinary facet that seems frequently ignored. That's the absence of the defendant's (the government defending the NSA) position. The reason is simple - the government failed to speak.

The ACLU representing all these folk sued. The government said the case should be dismissed due to lack of standing and the secrecy issue (not a law, a judicial precedence). Almost simultaneously, the ACLU asked for summary judgement on damages due to violation of FISA and the constitution. The judge said to both parties, "Show me." The government showed the judge some documents on the subject, but said (paraphrased) "the fact that some of the documents are secret are sufficient for the secrecy issue, and the lack of standing is self-evident." The plaintiffs meanwhile provided briefs defending the standing and countering the secret, and further supporting the summary judgements. The judge asked the government to respond. Deadline came, judge ended order (gave government a pass despite deadline missed) and issued new request for a brief. Again, government didn't respond. Judge issued intent - not ruling - and asked government to at least respond orally. Again, government passed. So the judge issued a judgement based on the facts provided.

Now, in cases involving common people like you and I, if we decline to rebut the other guy's allegations in court, the judge has no opinion but to assume we're silent because we CAN'T rebut them - they're true in all particulars as interpreted by the other guy.

With that in mind, the whole question of how ugly the writing is in the decision becomes VERY secondary. What the judge wrote, basically, was:
One element of the plaintiffs' suit is dismissed, but the secrecy issue does not apply to the remainder; the defendants have standing; the TSP (The Secret Program) causes harm, and because it violates the FISA and the first and fourth amendments of the US Constitution the remedy includes stopping the TSP.

Now, here's where we get the really big gamble by the DOJ. They've appealed, and the sixth will almost certainly accept the appeal for review. The question - the gamble - is whether they'll take it "de novo" or "on the record". The government's hoping for "de novo". Heck, an awful lot of pundits are saying "of course" the sixth will do it that way. But "de novo" is the unusual way. Normally an appeal is: given what the court we're appealing faced, the decision was wrongly decided because of misreading/ignoring/accepting... The problem - the risk - the government takes is that they didn't present a case. Now here's the thing. If it's 'de novo', I would bet on the appeal to the supreme court coming from the ACLU. If it's 'on the record' it'll be the DOJ that appeals upward.

My gut feeling is that the appeals court hears the case 'on the record'. The reason is the fact that Judge Taylor went overboard in trying to get the government to give its case. Yes, it's a significant case - if upheld it sets a defacto basis for impeachment of the president of the united states (violation of FISA is a felony). So the 'de novo' option is possible, and had the judge followed normal procedures I'd lean toward expecting that. But THREE OFFERS PLUS ORAL refused? Bah. And this completely sets aside the tone of the government attorneys. Supercilious comes to mind - We're here, but it really doesn't matter as we win regardless. Sneer. shudder. Oh - I'll also make a side bet on that internal bet, which is that regardless of the mode it's heard 'en banc' - by the whole appeals court instead of (or possibly subsequent to) the normal three-judge panel.

Now, what happens when it reaches the supreme court is another question. Frankly, I think the DOJ would rather it not get there based on the most recent 'big decisions'. The court came within a hairs breadth of accusing the current administration of war crimes, and specifically (and as bluntly as Taylor in this case) said the GC3 (Geneva Conventions common section 3) applies. Betcha they're even more adamant about the first and fourth amendments of the United States.

Monday, August 21, 2006


The next time somebody tells me how private industry is more cost-efficient than the public sector I'm going to spit in their face. Oh, I've always called them blind, but I've had to point out in the past that the reason for APPARENT better efficiency is workload requirements we put on government services. Add these workload requirements to private industry and they get worse than government returns.

Now, though, I've got a rock-solid point of comparison. The IRS is getting ready to outsource collection of debts under $25,000. Three private businesses have won bids to do the collecting. The New York Times claims the IRS reports it costs $0.03 (yes, three cents) per dollar collected to pursue theses. The three winners - allegedly low-cost bids - are charging $0.23 per dollar collected.

So, we taxpayers are going to get less return for our dollar? Private industry is almost 8 times less efficient? Bah.

This is even before we get into the question of whether private industry tax collectors are a good idea - an issue popping around several blogs right now.

Saturday, August 19, 2006

More cooking

Amazing. Get to talking about food and I actually get to posting more than once in a while on this blog. Anyway... Tonight's supper was BLTs for the wife and child, and a BLT salad for me.

Oh - no, I wasn't eating healthy, I was being a pig. Still, I'll share.

First, I cook my bacon in the microwave. I've a VERY old ridged bacon rack that is microwave safe and keeps the bacon out of its grease while cooking. Lovely device and I know I"ll miss it when it's gone. Basic technique I use is to set the minutes to equal the number of slices of bacon I've got, then LISTEN. When the bacon quits popping, it's time to stop the microwave. Tadaa - crispy bacon, not yet burned. As it happens, I know my particular microwave well enough to know it's 5 minutes for 7 slices. But that's after a long time using it, and I know that other microwaves cook just a tiny bit different. Enough...

I make my salad last. Lettuce first - here's my piggish moment, I'm making a salad so I'm going to use a healthy amount of lettuce. I toast some bread - and since I normally have two sandwiches it's four slices of bread. Large cubes, toss into the salad. The tomatoes get sliced thick and then cut into bite-sized chunks. The bacon - enough for two sandwiches - gets broken up and tossed on top. Now for the artery hardening step.

I take about as much mayonaisse as I'd normally put on the sandwich, and pour in the residual bacon grease. That usually means about two tablespoons of mayo and a tablespoon of grease. Whip thoroughly, and put into the salad, then toss to get the dressing everywhere.


Solitary pleasure meal

I just discovered I'm going to be home alone for a few days next week - probably. And The third thing to cross my mind was that I can finally eat my solitary pleasure meal.

I call it that because it's not something to be eaten when you expect to be near people for, oh, the next 48 hours. (guilty grin). As I said, I am fond of strong flavors...

It's a sandwich. Dark Rye, Garlic Sausage, Limburger Cheese, sourkraut, strong mustard. Assemble and grill like a Reuben. What, you've not assembled a reuben? OK, let's walk through the assembly.

Two slices of bread. A light coat of mustard on each - which among other things helps prevent the moisture of everything else coming through to the bread and dissolving it. Now I like melt on both sides, so I put cheese on each half. Limburger being a soft cheese, I spread it, but if you're assembling a reuben just put the cheese on one slice of bread for now.

Thin slice the sausages (or corned beef) and make a layer a quarter inch or so thick. Now put on WELL-DRAINED saurkraut. While I like strong flavors these are supposed to balance each other, so make this layer about half as thick as that of the sausage. Another layer of cheese goes on now if you're just making a reuben, and top it with the bread. Now it's time to grill.

Get your cast-iron skillet medium hot. Oh, you don't have cast-iron? mutter - I just realized what a post in the near future's going to be. OK, put your skillet over medium-high heat and let it set for a couple of minutes. You want it, hmmm, if you sprinkle a bit of water onto the skillet the droplets should dance, not sit and evaporate (too cold) or burst into steam (too hot). (look up sessile effect - that's what's going on. Anyway...)

Dampen a paper towel with oil, or use a butterbrush, and LIGHTLY brush the skillet with the grease. All you're doing is applying something that'll help brown and crisp the bread. Put the sandwich in the skillet. Wait between a minte and a half and two minutes, and turn the sandwich over. You'll have to wait just a bit longer to pull the sandwich out as the first pass cooled the skillet.

Actually, all you're waiting for is for the bread to sear enough that instead of bonding to the skillet it's separate. With practice you can test by nudging and recognize whether it's yielding to your nudge but still stuck or sliding and ready to pull.

Anyway, my stinky sandwich is now crispy and filled with several well-balanced strong flavors working in glorious competition. And your reuben, a much more civilized sandwich, is ready for you. Enjoy.

Friday, August 18, 2006

Tonight's meal...

It dawns on me I've not written of cooking in this blog - a terrible thing given how much I enjoy it. Allow me to remedy that by introducing tonight's supper. Nothing fancy, sorry. Just some simple pasta.

The spaghetti - start a gallon of water that contains a quarter cup of salt boiling. Add spaghetti based on how much the folk around you will eat. I'm a pig - I cook a quarterpound (quarter of a 'standard package') of noodles just for me. Oh - and for a general purpose 'string' noodle I use angel hair. I also cook the noodle just past al dente - I like it a touch softer. It doesn't absorb as much topping, but it also doesn't stick to my teeth needing later scraping. Oh - and given the dish I'm making, I break the noodles up into roughly thirds.

The topping - I was tired today, so I used this simple mix. A total of a quarter cup of fat, half butter and half olive oil. Mix to a loose paste and then microwave for a minute to get it just boiling. Add a finely minced garlic clove - no, I'm fond of strong flavors so for me that's TWO finely minced garlic cloves - to the oil, stir, and put back in the microwave for 30 seconds.

When the noodles are done, drain and put back in the pot. Pour in the oil, and toss to coat thoroughly. I grate in a bit of parmesan and toss again. Plate, and finish with a few grinds of black pepper.

For a side, I've got a medium cucumber in the refrigerator. A quick peeling, and then I quartered, seeded, and sliced into ~1/2 inch bites. A sprinkle with a bit of salt and some balsamic vinegar lite (you know, the cheap stuff that claims to be balsamic but isn't really), and it nicely balances the oil and starch of the main dish.

Not much work, not much fuss, and not much mess to clean up when I was done.

Wednesday, August 16, 2006

computer madness

The state of Georgia tried to go high-tech in an ultimately stupid way. Allow me ot pass onn the lesson.

CDL renewals now require this bit of registration and training. The training and registration are only available online. Registration requires entry of an email address.

Now, a large part and possibly the majority of CDL holders are long-haul truckers. Ponder this a moment. Email? Internet connection? Huh? Yes, some do - some post regularly, and a few even get online over wireless connnections. But for most that's not something they have or are used to having.

The libraries of Georgia - everyone's favorite place for computer access when you don't have your own - weren't warned of this little exercise. Most of them are like us - desparately short of money, and not in a position to train folk in how to use a computer, how to register email, how to follow links, and so on and so forth. Oh, we managed, but it's been a fascinating struggle and lesson in poor planning on someone's part.

Rule one: unless the position implies connectivity, computers as a sole source of processing are a mistake. Manual processing - though usually slower - should still be available.

Rule two: Don't blindside the people who have to do the work. It makes the customers mad at us - and we're smart enough to point them at the people responsible in the first place. More importantly, it meant that we weren't ready for the first handful through the door - and for most CDL drivers, the longer they're away from the vehicle the less money they make.

I suspect that the vetting process stayed within the bureaucratic circle and nobody who actually had to do the stuff got involved. But since I don't know that I can't say "pretest to destruction - intentionally choosing BAD customers instead of SAVVY ones." But I think that should be rule three anyway.


I still think we will have a military conflict with Iran before the November elections. I am almost 100% certain we'll have one before Mr. Bush leaves office, but I'm about 95% certain it'll come before the elections.

I am certain we're in the leading edges of a depression. That is, a period of two or more quarters of flat or declining GDP. This is before the effects of the first prediction are worked in. The leading cause of the depression is the increasing cost of necessities - energy and food especially - and will have strongest supplementation from the unemployment resulting from the housing bubble deflating (at best plateauing, at worst blowing up).

This depression will be characterized by a 'mild stagflation'. That is, the increasing prices of necessities will provide inflationary pressure, but flat wages and unemployment will mean the money supply doesn't grow to match. The effect will be deflationary in principle. That is, given x amount of money in the pocket of which proportion y goes to necessities and z goes to everything else (aka luxuries), as y goes up z shares a smaller pool of money. The response of sellers of z will be enhancing their products so the money comes to THEM. The easiest - and most frequent - enhancement will be reductions in price. Second most frequent will be 'toss-ins' - things added to the item purchased. These can range from intangibles (longer or more comprehensive warranties) to supplemental goods (50 pounds of laundry detergent with that new washing machine, or a dozen CDs with the new music system) to pure system enhancements (extra content or 'more' or 'bigger' or...).

During this period of time the 'winners' will be those who can maintain cash in excess of necessities and who can effectively negotiate/haggle when buying luxuries. The optimal side of the financial duology is the lender - what you lend comes back with more and at the same time the original loan has more purchasing power. The confusion to this is the rising cost of necessities. Eventually such a situation has to break. There are three general avenues. First, the necessities reverse price trend to follow the luxuries, and we enter truly deflationary period. Second, money is injected into the mix which allows/encourages more spending on luxuries - reversing their trend and pushing us into a pure inflationary period. Third, things happen to make necessities unnecessary (or at least less important), which both moves them to luxury status and frees more money for other luxuries. This last results in, well, it can go either way depending on the details.

But remember the first prediction -- War by November. War because of the Bush Ego (as I mentioned before), supported by numerous reports that the administration informed Israel that if it followed a plan to push into Syria during the recent hostilities it'd be supported. (That's pretty much confined to papers from Israel, though Reuters had the note in a couple of articles as well.) The recent Hezbollah suppression incident was supposed to lead to a region-wide war - Israel/US vs Syria/Iran, both with lesser supporting characters. But I digress, I was speaking of the effect of this on the economy.

On the one hand, it will push a necessity - energy (in the form of oil and natural gas) up toward catastrophic levels. This will be due to both fears of and actual shortages worldwide. On the other hand... on the other hand there will be a big buyer of a lot of goods - the US government. Yes, it's been buying a lot already, but this would be another significant increase. And that's where it'll inject more money into the pool for inflationary pressures. Yes, we'll still have consumer deflationary effects in a lot of places -- whereever the money from Big Customer Sam needs more than a couple of steps to get to the employee. (One problem with trickle down - if it worked - is that it's so delayed in delivery.) But this time the cost of most goods goes up because of the inflationary pressures of not only necessities but increased money supply.

This one's going to be rough. If you can borrow and get through till the money trickles into your pocketbook, do it. It's lenders that get bit by inflation. Also, if you can get attached to the government teat for direct money flow - but don't make it your sole source as I'll point out shortly. Another thing is to traffic in necessities. Note that you need to be careful here as some apparent necessities are or will be starting at costs too high to get a decent margin (if any - housing/rents). Finally, you can convert your money to hard and divestable goods that tend to track with inflation -- gold and silver being the classics, though there are other options as well.

I said don't weld yourself to the government teat. That's because of the after-effects of this engagement. I think - though I'm getting into much weaker levels of value - that the preceding inflationary period will approach hyperinflation rates. The inevitable consequence of hyperinflation is recovery - deflation if everything is perfect, and collapse being much more likely. Currency replacement - New Dollars - is a common solution. Even the essentially never-experienced disinflation to 'normal' levels will feel catastrophic. And during this time the government will be not only a lousy customer but will reverse the pumps - those industries most attached will be the ones that get to support the money contraction most strongly.

If you've lent money, try to anticipate. In just about every case calling in or selling the loans is a best option. After the downturn is fully recognized, well, nobody will want it. If you're sucking on the government teat, reduce the flow. Necessities - if you're in that business - are still a good business, though you should beware of the fact that things don't move evenly. It's a given that SOME luxuries will do extremely well in reaction - the problem being guessing the luxury. Hard goods are, well, it depends. If it's a collapse, keep them. If it's 'only' deflation, you might consider converting to a trustworthy currency - which may be the dollar or may be something else.

- 3 to six months of 'mild stagflation'. Lend if possible, but keep it short-term.
- six months to two years of heavy inflation. Borrow with care against overstretching. Provide necessities. Hold hard stuff. Try to get close to the money stream from the government.
- A period of correction, unknown duration, intensity from disinflation (0%) to collapse, probably deflation. Close the loans, cut the ties to the money stream, continue to provide necessities. The hard stuff just flat depends on the intensity.

Hopefully I'm wrong. Hopefully I'm overstating the whole thing, and I'm misreading the march to war.

But I'm in short-term CDs and I'm buying silver right now - the latter is trying to buy low for expected increases.

Tuesday, August 15, 2006

"earning" freedom

I've seen this pop up enough times it's gotten on my nerves. It's almost always talking about the Iraqis - though sometimes it's the Afghanistani or other middle eastern folk. And it's usually in conjunction with the phrase 'we can't give freedom'.

What? "They're earning their freedom."

Bull. The conjunction phrase is absolutely true: we cannot give freedom. We can create the conditions. We can let it be taken with no difficulty - with no strings and no hassles, as a child takes freedom from a loving family.

But "earning" freedom implies we have the right or ability to deny it -- and worse, the ability to give it once it's 'earned'.

Smell the coffee, folks. If we're using that phrase, we've seriously misapplied our priorities and energies. We can guide and help and push. We can encourage them to take their freedom. But we cannot judge them 'ready' for it.

And any attempt to do so is at best sanctimonious patronization which WILL be resented.

Tuesday, August 08, 2006

Paranoia and depression

I fear the future. Or perhaps I should say A future, the one that looks darn likely right now.

We're headed into a recession with the possibility of it being a real nasty one. We've got a surging inflationary push from increasing costs of energy and food (the drought as well as oil needs). We've got an upcoming deflationary push as the housing market drops - reinforced by the fact that credit card use has increased in a double digit rate the past couple of months. (Be fair, Kirk. 8.5% two months ago. 11% last month. That's "only" 9.75%, not really double digit growth.) [CORRECTION. 9.8% in May. 11% in June. That's earlier than last month. And it's definitely over 10%.] The oil is going to make everything more expensive. The approaching credit wall is going to stop access to 'money'. The result's pretty plain - stagflation. But that's not the worst of it.

Overseas, it appears to me that the US intends to let Israel 'clear the decks'. They're not going to permit a ceasefire proposal that doesn't give Israel what it wants. Since France is the one putting boots on the ground, France gets a say too, but it wants an actual ceasefire in place so they're not shot up by both sides. Which means they want a recognition of Hezbollah. It ain't gonna end soon.

And the longer it goes, the more it trends toward nightmare land. That's because Iran's getting more and more open about its support of Hezbollah. And Sistani in Iraq is getting more and more public about his unhappiness. All of which boils down to the "first pan-arabic war." And since such a huge proportion of oil comes from there, everyone's going to act to preserve their interest.

I have a nasty suspicion that school-children in a couple of decades will look at the kidnapping of the Israeli soldiers much as today we look at the assassination of ArchDuke Ferdinand. That wasn't really the trigger, but it's a single incident of focus that can be blamed as the trigger for what boiled into global - or regional war with players from across the globe.

I am not prepared for a world turned upside down again. And I fear that it's coming, ready or not.

Monday, August 07, 2006

Oil Peak?

As my handful of regular readers know, I think "peak oil" is a legitimate theory. Or rather, one of the 'peak oil' theories. Basically, there is a point at which the cost and difficulty of extracting oil are such that total production flatlines and declines.

I believe I'm vindicated. The following chart can be found at the Oildrum . The dataplots are from both the IEA and the EIA. The solid lines are the 13 month centered moving averages with a single recursion. Yes, it's a certainty that Katrina and the Nigerian reductions are part of this, but in counter I'll note that the peak oil scoffers claim that there's still a buffer in other nation capacities that would make up any shortfall. Nobody made up the shortfall, and they've had plenty of time.

This, by the way, is not counting this weekend's announcement of the shutdown of Prudhoe Bay - well, half of it. That's a 400,000 b/d drop, which in turn is about half a percent of global production. Which isn't a lot, really. Oh, and all these things that are causing reduced production - Katrina and Nigeria and Prudhoe and Iraq - will in turn mean that the peak will last longer. But I think it pretty apparent that we have a peak. Or at least a plateau despite demand.

I'm a cornucopiast instead of being a malthusian. I honestly believe that we have a relatively untapped or non-finite resource - human ingenuity - that CAN correct for finite resource difficulties. I believe that eventually we'll develop one of the current borderline energy sources to overcome the peak oil problem - just as we overcame the wood shortage and the difficulties of coal, as well as various food production issues. I also believe that we'll do it when we're pushed, which means the time of transition will be ugly and painful. And undoubtedly full of setbacks and confusion.

Fasten your seatbelts, it's going to be a bumpy ride.

A reader informed me that the chart was too short to be definitive - that I needed to go back 50 years to demonstrate the legitimacy. Well, I went back to 1990 - the earliest for which I could get data (the IEA wasn't even in existance in 1956) and pulled and ran the numbers. With the moving average in place there is no change. There's a brief flattening around 1996, but nothing like this.

Now it may not be peak oil - that is, the point at which we are producing as much as we can. It may be a global conspiracy by all the oil producers or oil companies or both. After all, a similar effect is going to show up in the OPEC Shutdown period. But the fact is that oil production rates have quit increasing. And given the amount of money to be had, I can't think of a reason for a conspiracy to do that -- excluding the difficulty of keeping it quiet with that many actors.