Saturday Night at the Races

Tonight is my favorite race of the season, the night race at Bristol Motor Speedway!

I love this race and look forward to it all summer:


If you hate NASCAR, you may still want to see some of this race, especially the end. The track is only a small half mile in size, but the extreme banking in the corners allows the cars to run over 130 mph because the force keeps them on the track! tempers flare easy here and often it will be a bumper car wreck show! Exciting stuff! At night you can see all the sparks and the rotors of the brakes get all cherry red. Love it!

Bristol is famous for great racing and rough endings. Of course the legendary Dale Earnhardt often featured in the outcome.

First, in 1995 Earnhardt chases down Terry Labonte and causes a big wreck right at the end (skip to the 2:25 mark):

Labonte saves the car but wrecks going across the finish line! he drove the totalled car into victory lane, it was so cool.

Ok, now 1999. Same two guys, different result (skip to 1:50 mark):

Oops! I saw that one live and it was awesome!

More Robots and Cybernetic Enhancements
I am sure all know Darth Vader's extensive robotic reconstruction and Luke Skywalker's cybernetic hand. Here are a few more related items from the Star Wars Universe:
Guri, a replica droid and easy on the eyes:


Arden Lyn had a crazy big robotic arm:


Bao-Dur and his replacement arm:

Cool stuff!

Have a good night.

Femtogram of Fun Friday

Nothing but cleaning up and a few nit picky things in the kitchen left! Things should be back to normal by tomorrow. I am working on getting some pictures together to show how I blew, I mean invested, a crap load of money.

I think I covered plenty this week and I also felt the content was pretty solid. I hope you all liked it.

Automation Observations
I have been harsh on the robot world in a few posts. I did it mainly as a funny thing, but I do think automation is an issue we will have to confront going forward as a job force. One of the best things about this site is the comments section and last post had a couple of additional thoughts I wanted to cover.

An anonymous reader offered (bold my emphasis):

Meh - its just the economy's way of signaling what will be important and what will not in the future.
OK so no jobs hammering down spikes. What about a guy or a team of guys to design the spike hammer robot? Maybe another guy or team of guys to service the spike hammer robot, etc.
It also allows for advances in human society (albeit at the expense of now obsolete workers) - but that's the way its always been. Time was, we needed to dedicate all our human capital to manual labor in order to function. Now with machines doing much of that, it frees up human capital to think about, and work on things we find important.
You are probably a great example of this - molecular biology was a pipe dream until this century. There was simply no way we could allocate a decent % of our workforce and human capital into this field. Imagine this back in the 1800s. Hey honey, I successfully manipulated this gene which will cure cancer - unfortunately I didn't have time to tend our field and now we will die of starvation - pity!BTW, that's the main reason I think that education is so hugely important and what we need to focus on more in this country. As machines do more and more of what we humans can do with our arms and legs, the only advantage we have is our brains. We use it to innovate, to create the machines or the processes that make more of our manual labor obsolete. If you don't have an education to do one of those innovative type things, be warned - those educated people are right now thinking about a machine machine can outwork you any day!

Several great points and I think a great comment overall. I certainly did not mean to say machines were "bad", just observing their rapid progress. As Anon says, it has always been this way. I wonder though how far this can go? An interesting thought experiment.

Reader Watchtower adds:

What strikes me as strange is now that we have all of these machines doing a lot of the manual labor that we used to, we are shelling out $40 - $100 a month to go to the gym and 'exercise'.
Not only that, but we are using machines to provide resistance (work) in order for the human body to function as it was meant to (smiley).

Oh the irony indeed! Good one.

Friday Night Entertainment
Friday night's post: 80% of the time, it works every time!

Treasure Hunters?
Thieves broke into an exhibit and stole a 75 ounce gold bar that came from the wreck of the Santa Margarita, which sank in 1622:
Gold bullion stolen from Florida treasure museum
I remember some idiot talking about the stock OMEX, which specializes in deep sea recovery of wreck treasure. Yeah, that worked out!

This is How the Zombie Apocalypse Will Come to Pass
First off, some research:

Parasite Infested Zombie Ants Walked the Earth 48 Million Years Ago
A parasitic fungus called Ophiocordyceps unilateralis that infects a plain old carpenter ant and takes over its brain, leading the ant to bite into the vein that runs down the center of a leaf on the underside. The ant dies shortly thereafter, but the fungus gains the nutrients it needs to grow this crazy stalk out of the ant’s body and release spores to create the next generation of ant-controlling fungi.
This cryptic cycle has been going on for at least 48 million years.

Uh oh.
Here is some troubling video:

Try and sleep tonight!

Facebook in History?
EconomicDisconnect does not use Facebook. As I understand it, it's main function is to allow old flames to find you, or allow you to search them out late night after too many wobbly pops. There are a couple I would be afraid of finding me (crazy!), and a couple I would be afraid to find (too hot for words).

What if historical figures had Facebook? Here is an awesome work up using such things as Abraham Lincoln, The Titanic, and the Dinosaurs:
If Historical Events had Facebook Statuses
Very original.

Happy Birthday
On this day in 1977 Voyager 2 was launched.

Pictures for the People
In color even!

Give the little guy a fist bump already!:

That was a really good one.

Great artistic rendering of a top battle from the expanded Star Wars Universe:
Corran Horn vs. Shedao Shai

Awesome!

Note: the funniest FAILBlog I have seen in some time was out today but this is a family blog so I left it off. No reason you cannot click to see it if you want though!

Rock Blogging
At last, we come to it!

Lurker requested Patsy Cline and "Crazy". Not sure if he thinks I am, the markets are, or something else. In any case, here she is in all her glory:

Timeless that one.

Gawains wanted some Marshall Tucker Band and "Can't You See". Yet another song I really like and had no idea who performed it! Thanks!:

Wonderful.

I had never heard "Jailbreak" by Thin Lizzy, but it was pretty good, via Watchtower:


I have always loved this song by Tracy Chapman. Please enjoy "Fast Car":

That song hurts.

What did mama say? L.L.'s said "Knock You Out" I believe:

Best way to stop an opponent in boxing is by body shots. They just go down and they are clear headed, but do not want to get up. It's crazy to watch happen.

Two songs left. A duo to send you off on the weekend. What to play?

One of my favorites, The Who and "Behind Blue Eyes":

In the studio on one of the iterations of the line "But my dreams.." (1:43 mark) you can hear Roger Daltrey's voice quiver, but they left it in to better capture the emotion of the song. I think that was genius!

Last call! If you were a sailor heading out to sea, well, behave accordingly!

I used this list of the greatest metal songs ever for the next selection. Not MY list, but a good list any way you look at it. Uh-oh, I may have played all of them! Ok, let's go with Motley Crue and "Shout at the Devil":

Nasty good!

Have a good night.

Not That Anyone Asked

The remodel is about done, and I am pretty happy. A few touch ups and we should be good to go.

Tomorrow is Friday night so you should know what to do by now.

I am a bit on the unpleasant side of the ledger this evening so I hope this post goes off cooler than I feel.

Channeling Economic Disconnect
While having another thinker in the world does not make you right, it does make you feel better that you are not crazy! From Minyanville comes this piece by David Stockman titled:
How Pimco Is Holding American Homeowners Hostage
Snippet:

This final transformation of American taxpayers into indentured servants of HIDC (the Housing Investment & Debt Complex) has been underway for a long time, and is now unstoppable because all principled political opposition to Pimco-style crony capitalism has been extinguished.

Nothing can stop it now.

Robots That Make me Mad
I used to work with my Dad doing railroad work on weekends and most summers when I was younger. We did everything, from installing switches to new rail installation. The worst job was the new rail installation. This required extremely hard work to lay ties, drill the spiking holes, place the plates, align the rails, and a spike the rails down. Labor intensive. It would take a crew of 6-8 about 3 days of murder effort to lay 100 yards of rail. We did this quite a few times. We had hand tools.

I watched a railroad job done in Cambridge the past couple of days that was at once amazing and scary. The job was railroad tie replacement. These are the black wooden things the rails sit on. They go bad over time. To do this you have to unspike the rails, remove the ties, dig new tie placements, get the ties under the rails, replace the plates, and then spike them down. Rough stuff. Not anymore. Now a series of robots do ALL THAT WORK in about an hour or two. Two hours! The robots do everything! Here is a link about the robot that hammers in the spikes and below is a picture:

I used to try and beat my Dad in a contest to spike down two full rails (I think it was 50 feet and maybe 100 spikes) but I was never even close. Nobody could beat this monster machine, not even John Henry.

In addition to the automated laboratory item I wrote about a while ago, this piece from Kid Dynamite today (not robots per say but automation could replace these workers one day soon), and high unemployment all around I can only say I am afraid of the robot revolution! They already do 70% of stock trading as well! There will be no quarter.

Treasury Meets With Blogger Part 2
I had no idea the Treasury meeting with some bloggers was going to be a recurring thing, and I have yet to get my invite! As it is here is a good recap by one of those to be selected John Lounsbury:
Further Thoughts on My Treasury Meeting
You can get the full attendance list at his write up and he was to update other blogger entries on the subject as well. Key take away:

The housing discussion crystallized again for me the overall policy direction that started with the previous administration and has continued with the current one. I have joined many others in using the term “kick the can down the road”. That is in fact the formal policy. It is nowhere written in bright lights, but that is the fundamental basis of policy.

With housing, the policy has been to diffuse a foreclosure problem over a longer time frame to reduce economic shock. With finance, the policy has been to create a “workout” time line for large banks to “earn” their way out of balance sheet problems.

Ok, pretend and extend. Nothing new there. I did offer in the comments:

Kicking the can down the road has always clearly been policy. What I wonder most about is if money/process focused people miss the damage done by such bailout policies and free rides to cushion the storm. The structural shift in consumer/borrower psychology will be different going forward due to these policies and missing that key point is a huge blindspot for policy makers.

It is hard to get more elaborate in a comment, but 6 people "liked" it so that is good I guess.

What I meant is that all the playing for time stuff maybe would be fine, but you have now taught terrible lessons that will not soon be forgotten. On the banking side the "we will get bailed out" hardwired belief is now a guarantee. More troubling, consumers may well be of the mind to get crazy again (should credit ever get extended) with thoughts of 2 years payment free in a home as well as two years of pretty good unemployment benefits. Not a good mix. Add to this you have a huge number of folks looking around and thinking they are doing things not only the hard way (paying what they take out) but possible the stupid way as well. Another great short sighted effort by our leaders.

When will they sit down with Denninger, Mish, Iacono, and Tyler Durden I wonder?

Know Your Role
Anytime I write about the bond market I know I should have hit "delete". I hate bonds and all debt instruments by nature. Anyways, I had said the rush to bonds was getting a bit crazy, well here is what I wrote last post:

The bond market is not making much sense right now; why bid up an asset (US debt) that can (and will?) be issued in unlimited amounts? I have no idea, but that short bus is as crowded as it gets without snapping a leaf spring.

Of course today there were several top flight rebuttals of the possible "bond bubble" meme. To be fair I never said they were a bubble, just that I did not get the stampede.

EconomPic eviscerates some math used in a WSJ article in an item you really should read, like now.

My favorite way to get all tied up in intellectual knots is to read a Pragmatic Capitalist item on debt and another pretzel was served up today:
Why The "Bond Bubble" Is A Total Myth
Now reading one of these things is like "crossing the streams" in Ghostbusters so I will tempt you with this:

What exactly is the U.S. government bond market? In a country with monetary sovereignty in a floating exchange rate system (USA & Japan, for instance) the bond market is really nothing more than a mechanism through which the central bank controls the money supply. It doesn’t actually fund anything as it does in Europe or under a gold standard. This is best understood by studying the bond auction data in the USA. Despite constant shrieking of a potential lack of buyers in government bonds over the years we continue to see incredibly high demand for US debt. The auctions are always oversubscribed. They never fail. Why is this? Why do the buyers keep coming back for more? The simple answer is because the government puts the buyers there. The auctions are designed not to fail. How is this you ask?

So when you hear that nothing is bigger than the bond market that is just a misunderstanding. It is a book keeping exercise. Nifty.

I would always defer to David Rosenberg on most things but a part of his commentary today got my wheels turning. Here is the relevant section:

So maybe Ma and Pa Kettle are moving to correct this mismatch on their balance sheet and adjusting it to capture more income, limit their risks and preserve their capital. We do know with certainty that the median age of the baby boom cohort is approaching 55. As strategists we have to come to the understanding that a powerful demographic trend is gathering momentum, which is generating this insatiable appetite for yield — an era of correcting the underweight in bonds in the aging (but not aged) boomer asset mix while correcting the lingering overweight in equities. This may prove to be a secular shift and it just makes sense to come to grips with what is likely to be a continued divergence in bond and stock performance in the future.

Again, Rosie has the goods and I would not argue with any of this really.

The over riding thought that jumped out at me was this and I have thought about it all day:

First everyone bought the Dot-Bomb stocks and had their butts handed to them. Then everyone bought a monster home, leveraged it to the hilt and got bankrupted. Now in an effort to pay for bailouts and extend the can kick everyone is piling into government debt to pay for it (except it doesn't?) as well as getting taxed higher to do the same (do taxes finance anything PragCap and if so what about 28 out of 30 years of deficits?). Just seems to me like the proverbial "everyone" is a serious chump.

Have a good night.

Elaborate Musings

Almost done, almost done! I had quite a few errands after work so I am pressed for time.

Care to Elaborate?
My post last night generated some questions over at the Seeking Alpha publication so I wanted to elaborate briefly.

I think that the mega refi/loan forgiveness deal is going to happen. I feel the US government will absorb the costs. I have no idea what the numbers will be, and I do not think it really matters. The question of morality and fairness to others is a waste of time as it has never stopped anything before so just leave that one out totally.

Now that said, many would wonder how the US can fund such a transfer of debt. My only answer is you have seen a bunch of it happen already. Consider how much additional debt was floated over the past year and now go check on some bond yields. See any problem? I do not. This in no way means I agree there will not be, but the first leg of the experiment went swimmingly well.

You can see what I mean whenever Paul Krugman writes a blog post titled something like:

"We spent a trillion (I wanted 10) and nobody batted an eye!"

The bond market is not making much sense right now; why bid up an asset (US debt) that can (and will?) be issued in unlimited amounts? I have no idea, but that short bus is as crowded as it gets without snapping a leaf spring.

I would add that much of this action has moved to the big US banks through FED enabled trading games with guaranteed profit. Where are the bond vigilantes? Making cash hand over fist thank you very much don't bother them.

It is rare I disagree with Ilargi of The Automatic Earth, but in today's missive he opines:

Millions of homeowners get to live cheaper, enabling them to spend more, home prices would go up, and it would cost the government nary a penny. Why didn't anyone else think of that? Well, all you need to do is look at who indeed would pay the costs. Which is the lenders, who would now receive 2-3% less in monthly interest payments. Wall Street would never accept it, unless Washington makes up the difference. Which Washington would never accept to do.

I totally disagree.

If things are pretty good and getting better, why do we get a piece by PIMCO's Managing Director Paul McCulley that contains such wild statements as these (via Tim Iacono):

But that could change, if the risk of a return to recession continues to rise, spooking the equity market. A few thousand points of Dow might be what is needed to get the attention of Austerian legislators wanting to get re-elected! Am I forecasting that? Not yet, but the odds are rising, I think.

Hey, you have been warned. This is how monetary policy is made nowadays, by kneejerk reactions to asset prices. Some more printing press euphoria:

To generate increased growth in aggregate demand, some sector of the economy must be willing to pro-actively lever its balance sheet. And that must be the fiscal authority, if the private sector is intent on delevering. Yes, I know all about the perils of long-term fiscal unsustainability. But I also know that in the long run, we are all dead. I see no reason to die young from fiscal-orthodoxy-imposed anorexia.

This line of thought is workable if two things are true about you:
-You are already rich
-You are closer to the end than the beginning of your journey

When some of the biggest players and smartest people are talking crazy and using really large numbers you should be ready to have something handed to you, none of which will be fun, well for you anyway.

Have a good night.

How I Know Housing is Dead for a Long Time

The final steps are being done on the kitchen! By Thursday all should be ready to go! I think it is looking very good and the new use of the space will allow a much easier time doing things in there.

How I Know Housing is Dead for a Long Time
I will lay out the long version below but the short version is:

Housing is dead because the banks do not even want any of the action

So simple really.

Ok, the long version.

Today's big conference on the future of housing finance was a mix of pure baloney and hints at the future. I am surprised at this hour in the evening there has not been much substantive discussion on the meeting, there were fireworks in my opinion.

First off, the baloney. Tim Geithner opened the show stating such things like Fannie and Freddie need overhaul and that taxpayers will not support housing in the future. The Treasury head also said the government needs to be smaller in the housing sector, while at the same time guaranteeing mortgage funds and low rates for all. Try squaring that jumble of mess!

The big dog of the day was PIMCO's Bill Gross who luckily dispensed with the double talk and playing make believe for the children in attendance. How does Mr. Gross see things in the future? You would already know if you have been reading as I have predicted this event for some time. From Yahoo Finance:

Banking execs say gov't needs to back mortgages
The call from business for less government has a notable exception: the mortgage market.
The Obama administration invited banking executives Tuesday to offer advice on changing the government's role in backing the mortgage market. While they disagreed on the exact level of support needed, the group overwhelmingly advocated for the government to maintain a large role in the $11 trillion market.

If the government pulled out, millions of Americans wouldn't be able to convince banks to take the risk of giving them home loans, the executives said. Ending government support could lead to a spike in mortgage rates. That could deter many from buying homes, and banks, mortgage lenders and Realtors would lose money over time.

This is pure disgusting, but at least it is both honest and shows what really matters to the bankers.

More:

Bill Gross, the managing director for bond giant Pimco, suggested Fannie and Freddie should be formally merged into the government. He also called on the administration to allow millions of homeowners to automatically refinance their loans to help stimulate the economy....

Gross said Fannie and Freddie's function should be consolidated into one government agency that would issue mortgage-backed securities. Without such a solid guarantee, mortgage rates would soar, he warned.

He also told the administration that the economic recovery required more government stimulus, particularly in the housing market. He suggested the administration push for the automatic refinancing of millions of home loans backed by Fannie and Freddie.

Refinancing those loans at the lowest mortgage rates in decades would give Americans more money each month. That would boost consumer spending by $50 billion to $60 billion and lift housing prices by as much as 10 percent, he said.

Without such stimulus in the next six months, Gross said, the economy will move at a "snail's pace."

Obama officials say they do not plan to enact such a program, which has been the subject of intense rumors on Wall Street in recent weeks.

So how many time does the biggest bond firm in the known Universe have to ask?

The set up here is slick as all get out. The components:
-Threaten lack of lending for mortgages
-Scare everyone with tales of higher rates
-Threaten to step away from lending
-Government is now "forced" to make a move
Where's my "Easy" button?

You can forget about merging FNM/FRE into the government balance sheet, that is not going to happen. They will instead just keep it in some off the book type of setup. The last line about all this being a crazy Internet rumor will come back to haunt quite a few people later on. This IS the plan as far as the banks are concerned, there is no back up.

What will be interesting to see is how the government will make a mortgage market with rates set at say 4% for the next 10 years should rates rise outside of the program. Any housing plan will have to figure out a way to skirt the structural issue of so many homes being financed at all time low rates, any rise and it is an instant loser for the homeowner. Expand you balance sheet much FED?

Stepping back, what was started today is the transfer of housing market responsibilities to the US government. The banks made a bundle on the way up, lost a bundle on the way down, got made almost whole via bailouts and selling bad paper to the FED, and now they are stepping away all together. They do not see a way to make any money in the housing market. Maybe the only smart thing they have done in a while. This will not be good for any of us though.

Have a good night.

All Systems Progress Towards Disorder

The countertops are installed! All that is left is to hook up the appliances and finish the electrical outlets! I will be posting the before and after of the project, I am so glad it is almost over.

All Systems Progress Towards Disorder
This post is going to be a serious jumble of random stuff. Not much grabbing my attention in the markets today so I got sidetracked big time.

Gold Home Made Video
The Big Picture has a video up today (made via xtranormal.com) which is so funny I almost hurt myself laughing. Check it out already!

New Boss 302 Ford Mustang
A few readers here are big fans of the Ford Mustang. I was always a GM muscle car man myself, but I love the new throwback Mustangs and the new Boss 302 looks like a winner as well. Enjoy!

Missing "Return of the Jedi" Scene
If you are a serious Star Wars fan, like me, then you know in the novel "Shadows of the Empire" Luke Skywalker constructs his new green lightsaber on Tatooine. A scene was filmed for this but was never used in ROTJ. Well here is what is looked like! (EDIT: sorry if the video does not work, the Lucas police must be on the thing! In case, I think you can watch it here.):

Awesome!

Vintage Games
Lost in the crazy world of gaming we have today, I could not help but remember a few old school games I used to play back in the day. This was before Nintendo, this was before Atari, these were the dark times!

Blue Max
My uncle was a nerd, and he had the Commodore 64 when they came out. I used to play this game called Blue Max, well when the game would load that is! You just flew a plane and shot stuff while trying to find fuel. Really grabs you, I know.

The Oregon Trail
This was another one I got to play on the Commodore 64. In The Oregon Trail your mission was to make it out to Willamette Valley from Missouri. You had to have enough food to get there and variables included weather and disease. I actually liked this game.

2-XL
Ok, now I am going old school!

This was an 8-track tape player that used the forward/reverse buttons in such a way as to make an interactive teaching game! This was really cool (at the time) though the robot's flickering red eyes could be scary!:

2-XL history on Wiki. Here is an interactive page to see what I mean.

Extreme Microbe
Ever hear of a Waterbear (Tardigrade)? Interesting creatures:

Tardigrades are polyextremophiles and are able to survive in extreme environments that would kill almost any other animal. Some can survive temperatures of -273°C (-460 °F), close to absolute zero, temperatures as high as 151 °C (303 °F), 1,000 times more radiation than other animals, and almost a decade without water. In September 2007, tardigrades were taken into low Earth orbit on the FOTON-M3 mission and for 10 days were exposed to the vacuum of space. After they were returned to Earth, it was discovered that many of them survived and laid eggs that hatched normally, making these the only animals known to be able to survive the vacuum of space.

Wow! Here is a picture of one:


Have a good night.

Smoking Fatties

Well I told you a big cooking post was on the way.......

Smoking Fatties
No, nothing illegal! Today I wanted to try making fatties. What are fatties? Basically big meat logs filled with stuff and slow smoked. You can be sure I picked this item to write the title of this post as well as to say "I did a fattie" so we can all laugh and chuckle. Hee hee.

Anyways, the setup:

Now there are a million iterations of this, but what I did was:
-One Jones sausage fattie filled with onions, mushrooms, peppers, an cheddarjack cheese
-One hamburger meat roll filled with mozzarella, pizza sauce, and pepperoni. A sort of meat calzone!

The best trick to do this is to use a 1 gallon ziploc bag. You fill the bag with the meat and use a rolling pin to flatten it out. Then add your internal ingredients. Here they are before rolling:
Sausage

Hamburg


Getting them to roll up nice can be hard, but it came out ok:



On the Big Steel Keg they went. I set up the smoker with indirect heat and some drip pans. Cooked at 350 degrees for about 90 minutes, or to an internal temp of 165 degrees. Here they are almost done:

The little foil piece was a patch to fix a small hole that opened up on one of the fatties.

After I took them off I gave them 20 minutes to cool. Here is a cross section look:
Sausage

Hamburg


They came out very good and the taste was really great. This is a heavy meal, especially the sausage fattie! I had 2 pieces each but I could not finish them. Usually some alcohol is required to get with a fattie, but I did these without any aid! If you are looking to try something different on the grill remember fatties need attention too!

Kevin Harvick Wins at Michigan
In a totally dominant performance, #29 Kevin Harvick wins at Michigan today:

That guy can really drive!

Have a good night.