Saturday, March 12, 2011
How Old Am I?
Old enough to remember when some college basketball teams would choose between the NCAA and NIT tournaments.
Friday, March 11, 2011
Confirmation of My Opinions
(Don't hold your breath waiting for a post entitled: "My Opinions Are Controverted by Fact".) Today's Farm Policy includes a couple bits in line with what I've blogged:
- a discussion by former chief USDA economist Keith Collins on the budgetary impacts of crop insurance, the increased prices and the exposure to RMA.
- Sheila Bair of FDIC talkiing about the dangers of the bubble (my word) in farmland prices
Great Recession: It Was All Reagan's Fault
Long time readers of this blog may have noticed I've certain people whom I'm prejudiced against: Michael Pollan, John Hinderaker, and Ronald Reagan being 3 of them. So I was very happy yesterday to discover the true cause of the Great Recession: Ronald Reagan.
I'm reading, sporadically, a book called Reforms at Risk, partly because one of its chapters deals with Freedom to Farm. Another chapter deals with the 1986 tax reform act, the best achievement of Reagan's second term. To describe the logic which connects the tax reform act to the Great Recession:
I'm reading, sporadically, a book called Reforms at Risk, partly because one of its chapters deals with Freedom to Farm. Another chapter deals with the 1986 tax reform act, the best achievement of Reagan's second term. To describe the logic which connects the tax reform act to the Great Recession:
- in the old days, before the reform act, a taxpayer could include interest on personal loans when she itemized her expenses.
- the tax experts in the Treasury wanted to end itemizing all interest (and to include fringe benefits like employer-paid health insurance in income, but that's a story for another day)
- the experts got shot down before Reagan submitted his proposal to Congress, but the 86 act did end the itemizing of interest on personal loans.
- so one effect of the act was people reduced their personal loans, and increased their loans secured by real estate, because that interest was still deductible. This meant not only reducing the amount of down payments (fewer 20 percent down loans) but also taking out second mortgages, and taking equity out of the house by refinancing for higher amounts.
- so the effect of the 1986 tax reform act was turn up the heat under the housing market by increasing the relative advantage of housing loans. Where once the housing market was just simmering away, over 15 years it came to a rapid boil, and then popped.
Star Spangled Gene Weingarten
Thursday, March 10, 2011
Hybrid Generators
Technology Review has this piece on hybrid generators for the Marines. Instead of sizing a diesel generator to meet peak power demand, the idea is to use batteries capable of meeting the peak demand, recharging them by running a smaller generator when they're drawn down. My Army career ended by running 45KW diesels supporting telecommunications trailers. As I remember it, we ran them at roughly 30KW much of the time, though it varied. The new concept sounds good, though the equipment is significantly more complex, both the batteries and the charging and control software. That may be a problem: though I was obviously a great operator, the Army didn't expect us to do much. We could start them, shut them down and change the oil and not much more.
I Call for Immediate Action on Global Warming
I've been mildly supportive of action to reduce the amount of global warming, and more dismissive of those who deny the science. But I've felt no urgency until today. Today is different. Today is serious. Today we must act.
Today the NYTimes connects high prices for coffee to global warming. So--I can handle hotter temperatures, I can handle rising sealevels (although Old Town Alexandria is being flooded tonight, so I'm not sure how they'd feel about a .5-1 foot rise), but I cannot handle losing my coffee.
ACT NOW
Today the NYTimes connects high prices for coffee to global warming. So--I can handle hotter temperatures, I can handle rising sealevels (although Old Town Alexandria is being flooded tonight, so I'm not sure how they'd feel about a .5-1 foot rise), but I cannot handle losing my coffee.
ACT NOW
Time to Garden---Updated
[March 14] This year we beat Michelle Obama--have some peas and lettuce in the ground. Apparently they aren't expanding the White House garden this year. Next year they should be able to have it be officially "organic"--wonder if they will?
[March 20] Here's Obamafoodorama's post on the planting. The post says they have 34 beds, which seems to be an increase from past years. However, because they've converted the raised beds, i.e., piles of dirt, into boxed beds with wood sides stained a rather obnoxious color they might have roughly the same square footage. I wonder about the wood--is it naturally rot-resistant or is it ordinary pine? The Reston community garden where my wife and I garden now bans preservative treated wood, so our neighbor guesses her new pine beds may last her 10 years or so. We installed our boxed beds before the ban went into effect, so the sides are original, about 30 years old. Contrary to concerns, I don't believe the leaching of preservative represents a serious health danger.
Unlike my neighbor, who invested in the fancy steel corner posts for making boxed beds, the White House seems to have gone with simple butt joints. One concern I'd have is the force of the soil inside against the sides may over time overpower the joints. But for now the garden looks good. The blogt explains the garden is visible to tourists, and thus must look good, hence the boxed beds. There's also the value of a clear separation between garden and non-garden, a big advantage when you're inviting urban kids who have little acquaintance with weeds or vegetables to work in your garden. Going to the boxed beds does mean a biggish investment in wood and labor.
Much of what was planted were started plants, cole crops. They did plant spinach and beets.
[March 20] Here's Obamafoodorama's post on the planting. The post says they have 34 beds, which seems to be an increase from past years. However, because they've converted the raised beds, i.e., piles of dirt, into boxed beds with wood sides stained a rather obnoxious color they might have roughly the same square footage. I wonder about the wood--is it naturally rot-resistant or is it ordinary pine? The Reston community garden where my wife and I garden now bans preservative treated wood, so our neighbor guesses her new pine beds may last her 10 years or so. We installed our boxed beds before the ban went into effect, so the sides are original, about 30 years old. Contrary to concerns, I don't believe the leaching of preservative represents a serious health danger.
Unlike my neighbor, who invested in the fancy steel corner posts for making boxed beds, the White House seems to have gone with simple butt joints. One concern I'd have is the force of the soil inside against the sides may over time overpower the joints. But for now the garden looks good. The blogt explains the garden is visible to tourists, and thus must look good, hence the boxed beds. There's also the value of a clear separation between garden and non-garden, a big advantage when you're inviting urban kids who have little acquaintance with weeds or vegetables to work in your garden. Going to the boxed beds does mean a biggish investment in wood and labor.
Much of what was planted were started plants, cole crops. They did plant spinach and beets.
Wednesday, March 09, 2011
Something I'm Ready to Believe
From Jack Shafer at Slate, in an article on the NPR fund-raising thing:
If you've ever hung out with rich people, you know they have a lot of crazy ideas and aren't afraid of expressing them.Of course, on mature second thought, I'll just believe it without going to the trouble of hanging out with rich people. Charlie Sheen is evidence enough.
From the Horse's Mouth: Michael Roberts on Climate Change
I'm too lazy today, after a visit to the dentist, to link to the NY Times article on the impact of global warming climate change (people who don't agree the globe is warming will agree the climate it is achangin')on US agriculture, but Michael Roberts clarifies the U.S. may make out like gangbusters. Sure, our corn production will be severely impacted by high temps, but because of inelasticities farmers may see crop losses more than offset by higher prices. Or they may not.
Those Overpaid Federal Bureaucrats, and a Certain House
There's a house on sale for $800,000. I got to thinking about whether the price was too high (the answer: not if the seller can find a buyer at that price. :-), a thought triggered by the note on zillow.com of the down payment and mortgage payment required.
Let me wing a few figures, based on the conventional wisdom back when I first bought a house (1976): a 20 percent down payment means a buyer needs $160,000 in cash. I guess that's probably not a problem, at least usually, because any buyer is going to be selling their current home. Although these days there's many fewer owners who have that much equity in their homes; many owners are under water.
The principal and interest with a 30-year mortgage is roughly $3,500, or $42,000 a year. Property taxes, at $12 per 1,000 assessed valuation, might be $9,000 or so. Add insurance of maybe a couple thousand, so you're talking PITI of around $53,000. Call it $50,000, because I like round figures, and figure what it's 30 percent of and you come out to about $170,000 a year.
Yes, when I bought my first house, the conventional wisdom was PITI shouldn't be more than 30 percent of gross income, at least that's what I remember. So, what's the bottom line?
Almost no federal employee could afford that $800,000 house within the constraints of 1976 wisdom. I don't know how many houses in the U.S. would go for more than $800,000, but lots. It's just another confirmation that high ranking federal employees are not overpaid, whatever may be true of lower ranking employees.
Let me wing a few figures, based on the conventional wisdom back when I first bought a house (1976): a 20 percent down payment means a buyer needs $160,000 in cash. I guess that's probably not a problem, at least usually, because any buyer is going to be selling their current home. Although these days there's many fewer owners who have that much equity in their homes; many owners are under water.
The principal and interest with a 30-year mortgage is roughly $3,500, or $42,000 a year. Property taxes, at $12 per 1,000 assessed valuation, might be $9,000 or so. Add insurance of maybe a couple thousand, so you're talking PITI of around $53,000. Call it $50,000, because I like round figures, and figure what it's 30 percent of and you come out to about $170,000 a year.
Yes, when I bought my first house, the conventional wisdom was PITI shouldn't be more than 30 percent of gross income, at least that's what I remember. So, what's the bottom line?
Almost no federal employee could afford that $800,000 house within the constraints of 1976 wisdom. I don't know how many houses in the U.S. would go for more than $800,000, but lots. It's just another confirmation that high ranking federal employees are not overpaid, whatever may be true of lower ranking employees.
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