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?