Monday, September 29, 2008


For those who just couldn't wait, I did go bike camping this weekend. The trip went well, and I enjoyed the experience. It was nice to just be away from everything. But now I'm back in civilization watching the market fall nearly 800 points and congress choking on the $700B "King Henry" bill. I found an article from BusinessWeek about Mr. Paulson from 2006, not long after he was appointed Treasury Secretary. Probably dull as paint drying when reading it in 2006, but in light of where we are today it is fascinating. I realize that the problems of the current crisis go back further than 2006, and possibly back to the early 80s, and as such it's unfair to heap all the blame at Paulson's feet. But this article certainly makes it harder to sympathize with the guy.

Paulson was the former head of Goldman Sachs (a name frequently in the news these days). According to the article:

The appointment of Paulson, Mr. Risk, as Treasury Secretary is at once ironic and completely appropriate. According to conventional economic wisdom, the single biggest problem the U.S. faces is a massive accumulation of debt. Both liberal and conservative economists warn that the bulging trade deficit, now roughly 6% of gross domestic product, poses a danger of sending the dollar plunging and causing a financial meltdown. The federal budget deficit for 2006 will hit at least $300 billion. And current projections call for Social Security and Medicare to run up enormous deficits in the long run.

Yet Goldman actually has leveraged up faster than the U.S. government in recent years. In 1999, Goldman had about $1.60 in long-term debt for every dollar in net revenue. In the same year, the federal government had $3.10 in debt, mostly long-term, for every dollar in revenue. Today [2006] the government has about $3.70; Goldman, around $4.

Clearly, Paulson isn't scared by debt and risk-taking. That might make him the ideal person to grapple with the U.S. economic and fiscal situation, which is more similar to Goldman's than most economists will admit. Facing intense competition from around the world, the only way the American economy can thrive is through risk-taking.

Combine that with a theory put forth earlier this month:

All the Fed's alphabet soup of emergency liquidity facilities innovated over the past year were structured around repurchase agreements. Toxic waste securities were used as collateral for US Treasuries and dollar credit at 85 percent of face value. But as each facility expires, it has to be rolled over and increased to keep pace with the implosion of credit in the interbank markets. Well over half the balance sheet assets of the Fed have been loaned out in this way, perhaps a critical amount in excess of this estimate. Without recapitalisation, the Fed is at risk of failure in the midst of this crisis. Its Enron-style accounting for the toxic waste makes it very vulnerable to a default by any of the repo counterparties it oversees and limits its ability to enforce any constraints as well.

The Paulson plan will provide a one off opportunity for banks to take their toxic collateral back and sell it at a Paulson-determined price for cash. He issues Treasuries to finance the plan which increases the supply available. He selectively decides winners and losers, of course in making the scheme available and pricing assets, creating arbitrage opportunities and survivor bias in the process.

In the meanwhile, the removal of the toxic waste from the Fed balance sheet and redeposit of Treasuries and cash as the repos unwind gets the Fed off the hook for having hypothecated most of its assets against worthless toxic waste at Enron-styled false valuations.

If I'm right, the Paulson Plan recapitalises the Fed without ever publicly admitting that it was dangerously overextended.

Yikes. I feel like I should head back to the woods.

Tuesday, September 23, 2008

Camp camp camp

We went camping at William O'Brien again this past weekend. The last time we went, it was just the immediate family. This time we went with another family. A guy I've known since high school, Eric, and his wife and children. Their kids and ours get along great and a good time was had by all. I first camped at this park with Eric when we were in high school. I couldn't even count the number of times I've been to this park. I just love this particular section of the St. Croix river valley and am drawn to return to it time and time again.

I had thought that this would close the books on my 2008 camping season, but I may be wrong. I've been wanting to get out for an S24O sometime this summer, but with all the other stuff going on it just wasn't meant to be. But I realized today that I've got a free weekend coming up, and the kids will be staying at Hotel Grandma/Grandpa. So I'm tentatively planning a quick solo overnight this weekend. I'm thinking about going to Afton State Park. They only have hike in spots, which is fine by me. I imagine I could get my bike to one of those spots without too much difficulty. But depending on weather and how I feel I might make it a car trip. Either way, I'll be packing only the essentials and doing the trip as ultralight as possible. Normally, I tend to be an "everything but the kitchen sink" type of camper, so this will be an interesting paradigm shift.

Thursday, September 18, 2008

The joys of home ownership

I had quite the exciting morning yesterday.  I woke up and went through my normal morning routine.  Everything was According to Hoyle until I had actually left the house.  As I rolled out of the driveway I noticed that the garage door didn't close.  This isn't out of the ordinary.  The guy we bought the house from installed a new garage door opener, because his old one didn't pass inspection.  Being a typical home seller, he did a crap job of installing the thing.  As a result, every so often the garage door won't close.  Normally it's because the sensor that prevents small children from being crushed to death under the garage door has been bumped and is no longer in alignment.  When the sensor is out of alignment, the garage door starts to go down and then realizes there is a problem.  The door goes back up and the light inside flashes on and off as if to say, "Remove the small child from the door area!"  Being a lazy homeowner I just nudge the sensor back into true and tell myself I'll remount them "soon."
So as I started down the hill I noticed that the door was back up and the light was flashing.  I turned back and tried my lazy man's fix.  Same deal.  Only this time as the door went back up I noticed that the wheel was out of the track on one side.  And then as the door reached the top and jammed, I noticed a gap of about 6 inches between the bottom row of panels on the door and the next set of panels.  That's not good.  I screwed around with it for about 15 minutes before giving in to the realization that this is beyond my abilities.  So I left a voicemail for the garage door company that had serviced the door a few years ago when something similar happened.  Then I drove downtown to get my work computer so I could work from home to keep an eye on the garage (since the door was stuck in "please rob me" mode) and be available for the tech.
None of this was a complete surprise.  Our house is a rambler built in 1951, and I'm quite certain this is the original garage door.  It's a big, heavy wood one.  About a year after we moved in the door bound up, that time in the down position.  A guy came out and looked at it and was able to fix it.  But he warned us that it wasn't going to last forever and we should think about replacing it.  He had left a sticker inside the garage with their phone number for future service.  I called that number around 6am and left a voicemail.  I didn't hear anything back so I left another voicemail around 10:30.  And then at noon, I called another company.  They answered right away and said their tech would be out between 3 and 5.
True to their word, the tech showed up about 3:30 and started work.  He thought he could fix the door, but again said it needed to be replaced.  I sat in the house and listened to him bang on the door for about 45 minutes.  He came in and said, "I got it down, but it's not going back up again."  He showed me where several of the metal bolts had sheared off, and a few of the wooden pegs that hold the panels together had pulled apart and broken.  And a piece of one of the panels had broken off and gotten jammed in the track, which is probably what caused the issue in the first place.  He left us some literature on new doors and took off for his next service call.  I spend the rest of the evening helping the girls with some really complicated math homework and didn't give the door much thought.  We're going camping this weekend, and I figured I'll deal with it next week.
What I hadn't considered was how I'm going to get my bike out.  We had pulled the cars out of the garage while the tech was working on it, so they are out and available.  But all my bikes are trapped in the garage!  I'm sure I can figure out a way to work around this, but the old brain wasn't feeling ambitious enough to tackle the problem this morning so I took the car.  I'm not too excited about hauling a bike out of the garage and through the house every morning and evening.  I'm also not too keen on leaving it outside overnight.  I wonder if Nancy would mind having a bike in the living room for the next few weeks...

Tuesday, September 09, 2008

Interesting times

I had an exciting moment on the way home last night involving a free-swinging cable, a large truck and a blissfully ignorant truck driver.  As I rode down the bike lane on Portland I approached the construction site at Lake St.  I watched the truck driver prepare to pull out in front of me and slowed down appropriately to avoid being crushed.  No biggie, after all these years I can almost see these guys with my eyes closed.  The truck pulled out without incident and went across three lanes of traffic, preparing for a right turn.  As he did, I noticed that there was a length of cable trailing from the top of the truck.  And as my eyes traced it back, I realized it was going to hit me.  I wondered if it would just snake past me, or tangle up and pull me to the ground.  As I was deciding what to do, it hit me in the head and knocked the visor off my helmet.  I stopped riding and wondered how this was going to play out.  Fortunately another construction guy started yelling, so the truck driver stopped and I didn't get to find out what being dragged by a cable behind a truck was really like.  Exciting!
In less exciting news the change of the season is officially upon us, regardless of what the calendar says.  It was 45 degrees out this morning when I left for work.  45 doesn't sound too bad, but 13 degrees above freezing sounds cold.  And it was a little chilly.  Yesterday I broke out my schpants to keep the knees warm, and today I actually wore gloves.  Not bike gloves, but fleecies that keep my fingers warm.  It's also getting dark.  When I leave the house, it's pitch black.  By the time I get through Ft Snelling the ambient light plus the street lights are enough that I can switch my headlight from steady to blink.  But it's getting darker every day.  In past years I've considered getting a generator hub and light so I don't have to worry about batteries and whatnot.  But I have been riding so many different bikes that it always seemed like a hassle to have a good light on one bike and then be stuck with the lesser system if I want to ride something else.  But this year I've been riding the Kuwahara pretty much exclusively, at least on the rides where a light might be required.  And I'm mentally revisiting the generator hub option.  The fellows at Hiawatha have a pretty darn good deal on a generator hub combo right now too which is or isn't helping, depending on point of view.  Hey honey, can I have a couple hundred bucks?

Wednesday, September 03, 2008

Humana/Bikes Belong volunteering

Before you read anything else about the bike share program, know this: For every mile ridden on a bike from the Humana/Bikes Belong bike share program during the RNC, a $10 donation will be made to the Red Cross for hurricane relief. That's right, $10 per mile. You have until 7pm tonight and from 7am to 7pm Thursday to make a difference just by turning over the pedals. I spent 40 minutes or so goofing around downtown Minneapolis this afternoon, logged 7.2 miles and put $70 into the hurricane relief fund. How fantastic is that? Get out there, now!

I got up early this morning to head to the Stone Arch Bridge for my volunteering shift with the Freewheel!n bike share program. I had to stop and take a picture of the sunrise over Ft Snelling because it was amazing. The picture didn't capture it at all.

I arrived at the Stone Arch location a little before 7 and received my uniform and a quick training on how to check bikes in and out. They had a nice assortment of cruiser bikes. Everything from the Trek Lime and Raleigh Coasting bikes with autoshift transmissions to a Giant 24 speed city bike. They also had men's and women's Schwinn Phantom single speed cruisers, along with a Specialized single speed. There were also a couple other bikes that we didn't have many of at our location and I didn't even see what they were because they were gone so fast.

The morning started out extremely chilly, about 52 degrees when I got there at 7. Combine that with the wind of the Mississippi and we stood around with chattering teeth waiting for the sun to start warming the place up. Several of our hand scanners wouldn't work because the batteries were too cold.

This was one of the error messages. Another guy's unit actually said "battery too cold" right on the screen! Due to the cold start we never did power up the bicycle powered smoothie machine. Not that I'm complaining. The folks from Bikes Belong who were coordinating the volunteers took great care of us. There was hot coffee in the morning (very welcome at 52 degrees), snacks throughout the day and a great boxed lunch from D'Amico. Lisa, our volunteer coordinator even brought us frozen juice bars (thanks Lisa!).

After my shift ended at 1:00, I became a customer and took one of the Schwinn Phantoms out for a spin to rack up some miles for the Red Cross. Republican fever was in the air:

There were actual Republicans too:

I visited all the Minneapolis bike share sites. Traffic by the convention center was a nightmare. Traffic cops everywhere, roads randomly closed off, a zillion hybrid Tahoes and cabs everywhere.

One of the coolest things I saw was the demo of the permanent bike sharing kiosks Minneapolis will be trying out. Once the RNC is over, the bike manufacturers will be leaving 70 bikes in Minneapolis to jump start the bike sharing program. The plan is to use these bikes as a pilot with city employees to work out the kinks. Then ideally they would roll out the program city-wide in the spring. I got a demonstration, and the system is incredibly simple to use. If you can withdraw cash from an ATM, you can use this. Swipe your card, choose your bike and go. It's really a well designed system. And Humana is planning to expand the functions of the kiosks in 2009. In addition to working with Trek to design a bicycle specifically for the bike share program, they are working to add mileage tracking for each trip and GPS route tracking so you know where you went. The system already will track the number of uses, total number of miles ridden and other interesting statistics. I was really quite impressed. Thanks to Andy for answering all my questions and giving a great, informative demo.

And thanks to all the folks working at the Stone Arch station for everything today. You guys made this a wonderful experience, each in your own way. It was great to work with you and get to know you!

Tuesday, September 02, 2008

RNC bike share webcam update

Almost forgot! The MSP live video feeds are up and running here for the RNC. You can find them all at the Freewheelin! webpage. If you're looking for me, check the feed from the Stone Arch Bridge between 7am and 1pm Wednesday the 3rd (tomorrow!). I have no idea how to capture the feed as a video file, otherwise I would and I'd get some screen caps. But I'll bring along my trusty Canon SD870 and try to snap a few photos. I don't expect to cross paths with anybody famous being as removed from the downtowns as Stone Arch is, but one never knows. Maybe I'll get to see Sarah Palin all spandexed up.