USDA Cuts Frequency of Ag Reports

In another stunning case of short-sighted budget cutting, the USDA will save millions, but cost the economy billions:

The U.S. Agriculture Department has kept tabs for decades on a wide range of agricultural industries that generate billions of dollars for the U.S. economy. But that's about to change, as the agency eliminates some reports and reduces the frequency of others to save millions of dollars in tight budget times.

The reports influence the price and supply of many products that end up on American dinner plates. Without them, some farmers say they'll be left guessing how much to produce and when to sell. Food processors and traders also will have less information when making decisions about buying and selling.

South Dakota farmer Richard Adee said he used the annual honey and bee report to decide when to sell his honey. If the February report indicated a large supply nationwide, he'd sell before prices dropped. If the supply was short, he'd hold on to the honey and wait for prices to go up.

I've listened to dad complain about the inaccuracy of the USDA crop reports, as they project production, then issue updates which roil the markets.  His claim is that private-sector players can do the same thing better and cheaper.  My claim is that the big players will use the dearth of government information to game the markets even more.  My belief is that if the private players had better numbers than the government, then the markets wouldn't react so violently to USDA reports.  As far as I can tell, the market players have a much better picture of the overall market than farmers, but the government has the best numbers because they have the farm-level information from farmers having to report their planted acres for direct payments, and having to report their yields for crop insurance. 

Whatever the case, we are not going to end up with a smaller government than we do now.  The main question is how efficient our government is.  As any businessperson knows, there is almost no limit to the amount of information someone can have which is beneficial.  Cutting statistical functions, like the Energy Information Agency already has, and USDA is implementing, will hurt both government and private-sector efficiency.  A 5% cut in direct payments would fully fund all of the statistical services, and would be well-worth the investment, but it is much more politcally feasible to save very small amounts by gutting little-known agencies.  It's just plain stupid.

The End of the World Today?

Well, some folks claim the Mayan Calendar ends today (via nc links):

About eight years ago John Major Jenkins and I had a debate about the meaning of the Mayan calendar end date focusing especially on whether the energies of the Long Count ends on October 28, 2011 or December 21, 2012. This still remains the most important question anybody interested in the “2012 phenomenon” is faced with, but while at the time the debate might have seemed theoretical, or even hairsplitting, it is now a question that has very significant and practical consequences as to how we relate to the future. While many would like to sweep the end date question under the rug or sit on the fence, no one can do so with their intellectual integrity intact. Since that debate Jenkins has appeared on a History Channel documentary where December 21 2012 is presented as a predetermined “doomsday” when the world is going to come to an end. I get quite a few letters, sometimes from young people that worry that the world will come to an end at this date since they have seen this documentary posted on YouTube. While most knowledgeable people would probably reject this way of presenting the Mayan calendar it is still important to ask the question who benefits from it. I feel there are indeed many people, also apart from the participants in such documentaries that benefit from the claim that the Mayan calendar ends December 21, 2012. Thus, I do not think that it is an accident that we do not hear of the October 28, 2011 date in public media. To begin with, as far as I know no one who adheres to the end date of October 28, 2011 has ever presented this as a predetermined doomsday and thus unduly associated the Mayan calendar with fear.

So far as I know, the Maya didn't predict the arrival of the Spanish, so why should I worry about the prediction of the end of the world?  I'll just await the end of the world with some Point Brewery 2012 black lager, if I can find it.

College Football Trophies-October 29

Probably the most famous trophy being played for this weekend is Floyld of Rosedale, to be given to the winner of the Iowa-Minnesota game:

It's definitely one of my favorites, because the story is very entertaining.

Florida and Georgia will play for the very new Okefenokee Oar, which came into existence in 2009:

Eastern Washington and Portland State play for points toward the Dam Cup, which goes to the overall winner over several sports.  Here is a picture that may be the actual trophy if you subtract the athletic cup:

The Citadel and VMI play for the Silver Shako, just what I'd want to win:

Cailfornia (PA) will play Indiana (PA) for the Coal Miner's Pail.  I'd have figured they'd play for a Hoosier Surf Board or something:

RPI and Union play for the Dutchman's Shoes:

Wow, that's a bunch.  As we get down to the nitty-gritty, I may have to save some of these for next year.

Encouragement

This month, due to surprising interest in the last few days over this, possibly the world's first infographic (showing Napolean's invasion of Russia, and subsequent retreat), this site has reached its second highest monthly pageview total, trailing only May:

Thanks to all who have come by.  I appreciate the visits, and feel free to leave a comment.

Productivity And Cost-of-Living

The Atlantic (h/t Ritholtz):

Here's a theory. In the last 30 years, productivity grew, but it didn't make you rich because all the benefits went to make stuff cheaper. You can see this in Walmart and on your computer screen. Food and clothes have never been more affordable. Information has never been so easily accessible. Electronics have never been so advanced. Consumer products have never been so diverse, effective, and cheap.

If everything is getting cheaper and better, why don't you feel richer? Because the basic necessities -- homes, gasoline, health care, and education -- are not getting cheaper. Real housing prices slowly increased for 30 years before the housing boom. Real gas prices are the same today as in the 1930s. The cost of health care is growing faster than wages. Higher education costs are growing even faster.

Houses, gasoline, health care and education make up the core of our day-to-day life. The typical American family spends half its money on housing and transportation. The economy spends one out of four dollars on health care ($2.6 trillion) and education ($1 trillion).

The reason these things aren't getting cheaper also goes back to productivity. Productivity is growing fastest where we work -- information, technology, manufacturing, wholesale, services. It is growing slowest around many necessities: health care, education, construction, and government.

I have the feeling gasoline will only get cheaper as the economy slows, then will spike up when things pick up, dragging things back down.  Housing prices were driven up by falling interest rates and a bubble mentality, and now they can't readjust enough because of the overhanging debt.  Clothing is cheaper because the work is outsourced, putting people here out of work and depressing wages throughout the economy.

Health care and educational costs reflect a number of factors, including distortions brought about by poorly implemented government involvement in the markets.  Health care cost is influenced by the mishmash setup we have involving private insurance companies, employer-provided insurance, a governmental safety net underlying this system and overinvestment by competing hospitals in each market requiring excessive treatment to cover underutilized equipment.  Education costs reflect a belief that everyone should get a college education, and that taking on debt is a good investment because future wage gains will be forthcoming.

Finally, productivity is growing fastest in the private sector, because that's where decision-making stakeholders can glean the most benefit from it.  Executives and shareholders see material gain from squeezing more productivity from workers without compensating them additionally for their effort, or outsourcing their jobs.  Investments in productivity-enhancing technology earn returns on investment much more quickly, leading to even more investment.  If more of this return went to labor, we would see more economic growth.  In education, health care and government, the executives and managers don't see nearly as much of the returns, so they don't push for as many changes, and taxpayers and customers have little leverage to push for it. 

Gingrich Brings Up Untrue EPA Farm Dust Allegation

The Des Moines Register covers the bullshit parade:

On Monday, Gingrich asked for a show of hands of people who were aware of the proposed dust regulation. Most in the crowd of about 175 people raised their hands.
He said he is convinced that the person who proposed the regulations “leaves an air-conditioned condominium to get on the metro subway to ride to an air-conditioned federal office building to sit in an office with no windows where they sit back and they imagine dust and then they decide, ‘You know, dust is bad.’ ”
He said that in a conversation with Iowa Sen. Chuck Grassley, he had discovered that EPA officials are talking about placing restrictions on farmers against plowing their fields when the wind is blowing in the wrong direction and goes onto a neighbor’s farm.
He concluded: “The EPA is probably the most destructive single organization in the federal government today because it has people who have selected out and who have imposed their will on the American economy and the American society with no regard for common sense and no regard for practicality and that is why we need to replace it.”
The crowd applauded loudly.
ANALYSIS: The EPA insists it has not proposed new rules on farm dust. Officials from the agency have said for months that such concerns are based on a misunderstanding about the agency’s rulemaking process. The agency since 1987 has regulated particulate matter under the federal Clean Air Act, but those rules are largely targeted at emissions from power plants, factories and vehicles. As part of a congressional mandate, the agency this year performed a routine review of science on various air pollutants, including particulate matter, that can cause heart disease and death. Such particulates can come from the use of fossil fuels in power plants and vehicles; wildfires; and, as people like Gingrich have noted, even dust from farming and unpaved roads.
EPA Administrator Lisa Jackson in March testified before the U.S. House Committee on Agriculture that the agency has no plans to expand regulation to the dust on farms. Jackson on Oct. 14 sent a letter to U.S. Sen. Debbie Stabenow, D-Mich., and chairwoman of the Senate ag committee, stating that no changes to particulate matter regulations are being proposed.

How can you tell when a Republican is lying?  You guessed it.  I am so sick of hearing this shit.  I would like to know how many dollars the Farm Bureau has raised peddling this.  Meanwhile, lakes throughout Ohio are being poisoned with algae blooms from runoff, and barely anything has been done to farmers.  Why on earth would they think EPA will come out with dust regulations when they haven't kicked anybody in the ass when marinas are closing and property values are getting crushed from manure and fertilizer runoff?  I don't get why people are so gullible.

Houston Wins Bayou Bucket In Record-Setting Fashion

Houston whipped Rice, 73-34, as Houston QB Case Keenum set the NCAA career touchdown pass record, one of 9 TD passes he threw in the game:

Keenum then threw three touchdown passes in a six minute span at the end of the first half to put Houston on top 38-20 and tie the touchdown passes record.
He set the record on a 41-yard pass to Charles Sims early in the third quarter to push the lead to 45-20. Keenum smiled and flashed the Cougar hand signal when he appeared on the jumbotron on the sidelines after setting the record. His teammates clapped and cheered while fans gave him a standing ovation.
He was 24 of 37 for 534 yards before he was replaced by backup Cotton Turner with eight minutes remaining.

That allowed Houston to take back the Bayou Bucket:




Rice celebrates with Bayou Bucket (previous year)



World Series Update

Last night when I fell asleep, I assumed Texas was going to win the World Series.  I was delighted to wake up and find out the Cardinals forced game 7.  The errors committed in the early part of that game gave me the impression that it wouldn't be thought of as one of the greatest World Series games in history.  I guess I was wrong.

HIV Wasn't A Threat Back Then

From wikipedia:

In the 1960s, after activity in civil rights, the then-Reverend Philip Berrigan, S.S.J., began taking more radical steps to bring attention to the anti-war movement. On October 27, 1967, the "Baltimore Four" (Berrigan, artist Tom Lewis; and poet, teacher and writer David Eberhardt and United Church of Christ missionary and pastor, the Reverend James L. Mengel) poured blood (blood from several of the four, but additionally blood purchased from the Gay St. Market- according to the FBI- poultry blood- perhaps chicken or duck used by the Polish for soup) on Selective Service records in the Baltimore Customs House.^[1] Mengel agreed to the action and donated blood, but decided not to actually pour blood; instead he distributed the paperback Good News for Modern Man (a version of the New Testament) to draft board workers, newsmen, and police. As they waited for the police to arrive and arrest them, the group passed out Bibles and calmly explained to draft board employees the reasons for their actions. Berrigan stated in the written statement, "This sacrificial and constructive act is meant to protest the pitiful waste of American and Vietnamese blood in Indochina". He was sentenced to six years in prison.

Yuck.  Protesters 44 years ago make the Occupy Wall Street folks look pretty tame.

Using Big Numbers

Apparently, Rick Perry is advertising that under his leadership as President, he will create 2.5 million jobs.  Divided by 48 months, that's 52,000 jobs a month.  Well, it just so happens that since March of 2010, there have been 2,088,000 jobs created.  Over 19 months, that's almost 110,000 per month.  That increase hasn't even registered after the terrible job losses from February 2008 until February 2010.



2,500,000 might sound like a big number to people, but it isn't.  The peak number of job losses occured in January 2009, the month that Obama took office.  Why this is Obama's economy, I'm not sure.  If you are looking for underwhelming jobs plans, Rick Perry has one for you. But if you are looking for a president with math skills, Rick Perry probably isn't the guy:

Perry also points to the Texas Enterprise Fund, an aggressive state economic development incentive he claims has netted 58,000 new jobs since 2003. However, Texas officials put the figure closer to 30,750 new positions.

That's an 88% differential.  I would consider that a significant difference.

MicroEssentials

Is it just me, or does this look like expensive fertilizer (as if the regular stuff from the cartel wasn't already ridiculously expensive):



I do so enjoy how agricultural advertisers target Big Ten sports broadcasts and local news commercial breaks around the weather and sports reports. I saw this on the Big Ten network Saturday.

Luxury fertilizer. I never thought I'd see the day.

What's Going On In South Dakota?

NPR:

It could be that Children's Home was the best organization for the job, at the best price for all those contracts it got.
But it would be difficult for tax payers to know. In just about every case, the group did not compete for the contracts or bid against any other organization. For almost seven years, until this year, Daugaard's colleagues in state government just chose the organization and sent it money — more than $50 million in all.
"It's a massive conflict of interest," says Melanie Sloan, executive director of the Washington, D.C.-based Citizens for Responsibility and Ethics in Washington, adding that any organization run by a state's top elected official would have undue power in that state.
"When you're lieutenant governor, people are anxious to curry favor with you," she says.
Daugaard declined NPR's repeated requests for an interview. In a statement, his office said Children's Home was the only viable organization that could have done the work, and that Daugaard never used his influence as lieutenant governor to secure contracts for the organization.
Tribal leaders, though, say the unusual relationship provides a window into the role money and politics play in South Dakota's foster care system. They say the dominance of Children's Home in this area is but one example of the interests of the state trumping the interests of native children.
"They make a living off of our children," says Juanita Sherick, the tribal social worker on South Dakota's Pine Ridge reservation.

Would state welfare officials really take children from Indian families and put them in foster care for political payoffs and more federal funding?  I don't trust Republicans at any level of government, but I would assume that even they are above abusing children. 

GDP Growth Up 2.5%

Shows what I know about double dips.  I'm still not too confident about the future.  One political party swears that more tax cuts and more government spending cuts will bring prosperity.  I think they are morons.

Understanding Scotsmen

Apparently, the iPhone's Siri can't understand the Scottish accent:

Since Apple launched her two weeks ago, it has become clear that Siri is an “intelligent personal assistant” of many talents. She can remind you to pick up your laundry. She can send flowers to your grandmother. She can tell you the meaning of life. (Really.) As David Pogue wrote, Siri even has a sense of humor. Ask her what she’s wearing, and she’ll answer, “Aluminosilicate glass and stainless steel. Nice, huh?” She might even be able to tell “Motte” from “Rzepczynski.”

The one thing that Siri cannot do, apparently, is converse with Scottish people. According to an article in today’s (U.K.) Times, recent exchanges between Siri and Scottish iPhone users have resembled a Clouseau skit, or that scene from “My Cousin Vinny,” in which Vinny keeps talking about “two yutes.”

If you click over, they have the "My Cousin Vinny" scene on YouTube.

Satellite Tampering

Bloomberg, via Ritholtz:

In the October 2008 incident with the Terra AM-1, which is managed by the National Aeronautics and Space Administration, “the responsible party achieved all steps required to command the satellite,” although the hackers never exercised that control, according to the draft.
The U.S. discovered the 2007 cyber attack on the Landsat-7, which is jointly managed by NASA and the U.S. Geological Survey, only after tracking the 2008 breach.
The Landsat-7 and Terra AM-1 satellites utilize the commercially operated Svalbard Satellite Station in Spitsbergen, Norway that “routinely relies on the Internet for data access and file transfers,” says the commission, quoting a NASA report.
The hackers may have used that Internet connection to get into the ground station’s information systems, according to the draft.
While the perpetrators of the satellite breaches aren’t known for sure, other evidence uncovered this year showed the Chinese government’s involvement in another cyber attack, according to the draft.

As dependent on GPS as our military is, Chinese space adventures have to be keeping Pentagon officials up at night.

Rich Folks And Government Subsidies

The wealthy get handouts, too, via Mark Thoma:

Accumulating a great fortune requires, among other things, a legal system oriented to property rights, a tax system biased in favor of investment income, and government spending on infrastructure ranging from interstate highways to the internet.

 He gives numerous examples of how the 1% have received subsidies on top of these general government provisions. Bill Gates' Microsoft received $32 million in Texas for a data center in Bexar County. Warren Buffett's General Re, an insurance company owned by Berkshire Hathaway, got $28.5 million in various subsidies simply to relocate from one place in Stamford, CT, to another, creating no new jobs. Michael Dell's self-named firm got $242 million (nominal value) from North Carolina for a computer manufacturing facility which closed less than five years later.

Not that this is extremely surprising, but with the myth of the self-made man going so strong, people ought to remember this.  It has become de rigour that businesses should get tax credits on any new investment.  I find this trend to be self-defeating for taxpayers.  In essence, we are paying for jobs.

Texas Justice And Cameron Todd Willingham

I watched the Frontline episode last night which featured the case of Cameron Todd Willingham.  The thing which was most amazing to me was that so many people in the show still are certain he committed the crime.  I don't know whether he did or not, but I think the state had no real evidence that he did.  I realize that many people here would probably say the same things as those folks in Texas, but I bet it would be a smaller percentage.  There isn't enough money in the world for me to move to Texas.  Just this one case alone is ample evidence that Rick Perry has no business running for president of the United States.

Harvest Update

We finished the beans yesterday, except for 50 acres of double-crop beans.  Today we ran about 30 acres of corn, leaving us with about 275 acres to go.

The End of Fall Colors?

Maybe, via nc links:

That’s partly why the specter of declining foliage tourism is so worrisome to New England scientists and tourism leaders these days. Both climatologists and phenologists—who study the effects of seasonal changes on plants and animals—are becoming increasingly concerned about the effect of rising temperatures on Thoreau’s spectacular “autumnal tints.”

First, our signature crisp fall air seems to be turning less, er, crispy. The Union of Concerned Scientists has found that northeast temperatures have been rising by about 0.5 degrees Fahrenheit per decade since 1970, with winter temperatures rising at a rate more than double that. The group says that regional temperatures could rise another three degrees within the next 30 years, and up to 12 degrees by 2099.

This warming is already producing a constellation of region-specific effects, including a longer growing season and compromised sap production. Forest aesthetics are not immune. The New England Climate Coalition predicted a few years ago that if temperatures continue to climb unabated, “the fall foliage for which the region is famous will disappear as birch, maple, and spruce species migrate north or die out altogether.” New Hampshire’s Department of Environmental Services warned in 2008 that the state’s hardwood trees could move north by up to 300 miles. In Maine, scientists have enlisted citizens to document the effects of climate change by monitoring their own backyards.

Not only will the current forests simply move north. The colors themselves could fade. The chemicals that create yellow, gold, and orange colors lie dormant within tree leaves all year long. In the spring and summer, the green color—chlorophyll—overwhelms them. Then in autumn, the greens fade in response to shortening days and the underlying colors become visible to the naked eye. Under most conditions, those yellows and pale oranges will emerge in the fall no matter what. The chemical that produces red leaves, anthocyanin, is different. That color must be produced each year by a precise, yet not fully understood, combination of sugar, temperature, and light.

This may be a minor impact of global warming/climate change, I'm more concerned about food production.

The Class War Rages

Frank Rich on the three decade-old war in America (h/t Ritholtz):

Our class war will rage on without winners indefinitely, with all sides stewing in their own juices, until when? No one knows. The reckoning with capitalism’s failures over the past three decades, both in America and the globe beyond, may well be on hold until the top one percent becomes persuaded that its own economic fate is tied to the other 99 percent’s. Which is to say things may have to get worse before they get better. (bold mine)

Over the short term, meanwhile, the Democratic Establishment is no doubt wishing that Occupy Wall Street will melt away with the winter snows, much as its Republican counterpart hopes that the leaderless tea party will wither if Romney nails down the nomination. But even in the unlikely event that these wishes come true, it is not likely to be the end of the story. Though the Bonus Army was driven out of Washington in the similarly fraught election year of 1932, the newsreels they left behind turned out to be previews of coming attractions for the long decade still to come.

That's going to take a while.  As long as the power brokers like Steve Jobs look to China for their labor, and their profit margins, things will deteriorate here.

The Robots Are Coming

The Atlantic on robots and their current limitations:

If, as these examples indicate, both pattern recognition and complex communication are now so amenable to automation, are any human skills immune? Do people have any sustainable comparative advantage as we head ever deeper into the second half of the chessboard? In the physical domain, it seems that we do for the time being. Humanoid robots are still quite primitive, with poor fine motor skills and a habit of falling down stairs. So it doesn't appear that gardeners and restaurant busboys are in danger of being replaced by machines any time soon.
And many physical jobs also require advanced mental abilities; plumbers and nurses engage in a great deal of pattern recognition and problem solving throughout the day, and nurses also do a lot of complex communication with colleagues and patients. The difficulty of automating their work reminds us of a quote attributed to a 1965 NASA report advocating manned space flight: "Man is the lowest-cost, 150-pound, nonlinear, all-purpose computer system which can be mass-produced by unskilled labor."

Luckily there are stairs into the house, so maybe I'll be protected from being overrun by robots.  I like the NASA quote, but they'll probably have to update it to 200-pounds nowadays.

Horse Slaughter Continues, Just Not In U.S.

NYT, via Yglesias:

The closing of the country’s last meat processing plant that slaughtered horses for human consumption was hailed as a victory for equine welfare. But five years later just as many American horses are destined for dinner plates to satisfy the still robust appetites for their meat in Europe and Asia. Now they are carved into tartare de cheval or basashi sashimi in Mexico and Canada.
That shift is one of the many unintended consequences of a de facto federal ban on horse slaughter, according to a recent federal government study. As the domestic market for unwanted horses shrinks, more are being neglected and abandoned, and roughly the same number — nearly 140,000 a year — are being killed after a sometimes grueling journey across the border.

Well, no kidding.  I never understood the concept of banning the slaughter of horses for meat.  Just because it doesn't sound appetizing to us, I don't understand why it can't be done in the U.S.  We are talking about 1,000 pound animals who consume an extraordinary amount of feed.  If some individual or group wants to prevent horses from going to slaughter, they can purchase them and continue feeding them.  Why should large amounts of meat go to waste, when people are willing to purchase it? 

Rugby vs. American Football

So yesterday, NBC broadcast the Rugby World Cup Final match between New Zealand and France (which New Zealand won, 8-7) and the Tampa Bay Buccaneers played the Chicago Bears in London.  The Daily Mail appears to be most interested in the cheerleaders at the game in London.  I turned on the rugby match for a little while, and couldn't make heads or tails of the game.  I can only imagine that American Football appears the same way in London.  It seems alright for some distractional entertainment, but I don't see either sport catching on with new crowds.

Non-NASA Photo of the Day

Via Ritholtz, MSNBC features this:

A meteor, the Milky Way and the Northern Lights. Capturing just one of these natural beauties in a photo is a feat many photographers would be proud of.

Amateur photographer Tommy Eliassen struck photo gold in this beautifully composed image he shot in Ifjord, Finnmark, Norway.

Eliassen made the photo on Sept. 25 using a Nikon D700 with a wide angle lens and long exposures between 25-30 seconds.

Pretty awesome.  Makes my weak efforts look like crap.

Jobs To Obama: U.S. Should Be More Like China

That was my takeaway from this article:

"You're headed for a one-term presidency," he told Obama at the start of their meeting, insisting that the administration needed to be more business-friendly. As an example, Jobs described the ease with which companies can build factories in China compared to the United States, where "regulations and unnecessary costs" make it difficult for them.

Steve Jobs may have been great at producing consumer appliances, but I don't think I want somebody with this type of mindset setting industrial policy.  Holding up the Chinese government as an example of how to get things done doesn't sit that well with me.  Something about private property and such, minimal workers right, environmental protection, I don't know.  Also, I think most U.S. executives would frown on Chinese handling of executives who screw up too badly.  Considering almost no U.S. bank executives have gone to jail, they ought to count their blessings that the Chinese Communist Party isn't in charge.

More On The Landesbanks

Via Ritholtz, alternet gives some detail on the German state public banks:

One overlooked key to the country's economic dynamism is its strong public banking system, which focuses on serving the public interest rather than on maximizing private profits. After the Second World War, it was the publicly owned Landesbanks that helped family-run provincial companies get a foothold in world markets. As Peter Dorman describes the Landesbanks in a July 2011 blog:

They are publicly owned entities that rest on top of a pyramid of thousands of municipally owned savings banks. If you add in the specialized publicly owned real estate lenders, about half the total assets of the German banking system are in the public sector. (Another substantial chunk is in cooperative savings banks.) They are key tools of German industrial policy, specializing in loans to the Mittelstand, the small-to-medium size businesses that are at the core of that country's export engine. Because of the landesbanken, small firms in Germany have as much access to capital as large firms; there are no economies of scale in finance. This also means that workers in the small business sector earn the same wages as those in big corporations, have the same skills and training, and are just as productive. [Emphasis added.]

The Landesbanks function as "universal banks" operating in all sectors of the financial services market. All are controlled by state governments and operate as central administrators for the municipally owned savings banks, or Sparkassen, in their area.
The Sparkassen were instituted in Germany in the late 18th century as nonprofit organizations to aid the poor. The intent was to help people with low incomes save small sums of money, and to support business start-ups. The first savings bank was set up by academics and philanthropically minded merchants in Hamburg in 1778, and the first savings bank with a local government guarantor was founded in Goettingen in 1801. The municipal savings banks were so effective and popular that they spread rapidly, increasing from 630 in 1850 to 2,834 in 1903. Today the savings banks operate a network of over 15,600 branches and offices and employ over 250,000 people, and they have a strong record of investing wisely in local businesses.

The Bank of North Dakota and the Landesbanks are interesting models which could impact financial reform in the United States, but I doubt they can make much headway versus the loobying power of the financial giants, and the private is perfect mindset of the conservative movement.  Credit unions will probably be the main way in which the little people will be taken care of in the near future.

In the end, I think the strength of the German model is in the frugality of the citizens and the governmental manufacturing policy, which keeps the nation as a manufacturing exporter.  Neither of these policies is extremely compatible with American culture, and for a nation like Germany (or China) to be savers, other nations (the U.S., Greece, Italy, etc.) have to be borrowers.  As we've come to realize, you can't be net borrowers forever, which would tend to indicate that you can't be net savers forever, either.  As a nation, the United States needs to save more, while the Chinese and Germans need to spend more.  Personally, I probably need to spend more than I do.  As Keynes pointed out, the economy comes to a screaming stop when everybody tries to save.  That's where we are now.

The Chemistry of Whiskey

Via the Dish, lulucrumble highlights some of the 300 or so chemical compounds that make up whiskey:

Some chemical compounds sneak in at birth. The first stage of whisky-making, malting, requires fire to dry the barley. Peat is one fuel for this fire, and peat contains phenols. These aromatic hydrocarbons produce the rich, smoky flavours of whiskies made in peat-fired distilleries like those on the small Scottish island of Islay. When you sip an Islay whisky, you can almost feel the peaty smoke fill your mouth.

Distilling adds chemical fire to the wash. It captures the strong, burning ethanol, but also the buttery diketone, diacetyl, and the fruity acetals. Distillation also produces fusel oils. In small quantities, these higher-order, oily alcohols round out a whisky, giving it body. In excess, fusel oils are toxic. The stillman who brings the whisky through this adolescence is a Goldilocks figure, cutting off the distillation at precisely the point where the concentration of fusel oils is just right.

And so we have a teenage spirit, grown up from its babyish beginnings in a warm bath. What our 12th century monks did not know is that uisge beatha is not the end game. Place the young spirit in a wooden womb and something really comes to life. After three years or more in an oak cask, the water of life is reborn.

“We do not know exactly what happens in the cask, it is still a mystery that science is yet to fully understand,” says Professor Paul Hughes, Director of the International Centre for Brewing & Distilling, Edinburgh. What the Centre’s scientists do know is that chemical compounds in the oak enrich and transform the spirit.

Tannin, which makes tea brown, gives whisky its golden glow. Oak lactones also mingle in, giving a hint of sweet coconut. The carbon lining of charred whisky helps to release vanillin from the oak. The active carbon filters out undesirable substances like sulphur that cause an eggy taste. Gaps and pores in the cask’s wood let in air. Gently, gently, this air oxidises the alcohols, breathing new life into the spirit. Ethanol reacts with acids during this maturation process, giving rise to zesty esters – more commonly found in pear drops.

The change from white liquor to brown is rather astounding, and as the author notes, drinking an Isley whisky, or another peat-smoked malt, is a very unique experience.  I would liken it to drinking smoke.

About That Rapture

If that Rapture came on Friday, that preacher was right, it came very quietly.

Division III Scoreboard

#1 Wisconsin-Whitewater beat Wisconsin-Oshkosh, 20-17
#2 Mount Union defeated Capital, 27-7
#3 St. Thomas got by #10 Bethel, 23-13
#8 Thomas More beat Bethany, 41-21
Massachusetts Maritime beat up on Maine Maritime, 34-6
Mount St. Joseph defeated Earlham, 28-7
and St. John's won at Gustavus Adolphus, 24-16

The rest of the scores are here.

By the way, I can't believe how the Wisconsin-Michigan State game ended, and Albert Puhols had an unbelievable game 3.  Seriously, 5 for 6, with 3 HRs and 6 RBI?  Wow.

Who Runs The Commodity Markets?

Reuters, via nc links:

For the small club of companies who trade the food, fuels and metals that keep the world running, the last decade has been sensational. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the world's biggest trading houses. They form an exclusive group, whose loosely regulated members are often based in such tax havens as Switzerland. Together, they are worth over a trillion dollars in annual revenue and control more than half the world's freely traded commodities. The top five piled up $629 billion in revenues last year, just below the global top five financial companies and more than the combined sales of leading players in tech or telecoms. Many amass speculative positions worth billions in raw goods, or hoard commodities in warehouses and super-tankers during periods of tight supply.
U.S. and European regulators are cracking down on big banks and hedge funds that speculate in raw goods, but trading firms remain largely untouched. Many are unlisted or family run, and because they trade physical goods are largely impervious to financial regulators. Outside the commodities business, many of these quiet giants who broker the world's basic goods are little known.

The article profiles, among others, Cargill, Koch Industries and ADM.  At a certain point, you have to wonder, when is enough enough for these folks?  They get control of a larger and larger percentage of the market in a commodity, and then squeeze.  Will there ever be a time when they don't want even more?