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    Fall Colors at Their Apex

    Posted by Carl from Chicago on 26th October 2014 (All posts by )

    Last weekend we were in southern Wisconsin. Periodically we attempt to drive up and look at the fall colors but often we get there just a bit too early or a bit too late. This time we drove down a winding road and the colors were at their absolute apex – big golden leaves falling down right on the car.

    Cross posted at LITGM

    Posted in Photos | 4 Comments »

    25 Stories About Work – Lost Productivity and Typing

    Posted by Carl from Chicago on 23rd October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Vermont, the early 1990s

    When I was interviewing for my first job I had a chance to visit IBM in Burlington, Vermont. At the time IBM had a large contingent of workers and management staff at that location. On an unrelated note, IBM still has about 4000 workers in the state, and recently offered a company $1B TO TAKE THEM OFF THEIR HANDS. To confirm, they were willing to sell this business for negative one billion dollars (to quote Dr. Evil). And the sad thing is that the “buying” company wanted IBM to PAY THEM two billion, so they rejected the “offer”. Read about it here.

    I had been on a plane maybe once or twice previously and was completely clueless about what to do. I packed my bags and took a cab to the hotel. In the morning, before my interview, I got into the shower and turned on the water. I did not think to check what the temperature was before I got into the shower and it happened to be set on a scalding level; I ended up falling back out of the shower, grabbing the curtain on the way down, and scattering the shower curtain rings throughout the bathroom. I wasn’t seriously hurt. To this day I always check the shower temperature while standing outside the shower stall (or tub) and I only go in when it is at an appropriate level.

    The day started out on an ignominious note (with the shower incident) and the interviews were a disaster. I think we ended the day with a discussion that maybe someday I would at least utilize IBM equipment (they were primarily a manufacturing company at that time) since it seemed obvious that I wouldn’t get a job offer in Vermont.

    What I remember most of all was the endless sea of desks. IBM had workers that manually calculated their managerial accounting reports and they sat in a giant room that seemed to go on for infinity. I don’t have a photo but in my head it looks something like this…

    Read the rest of this entry »

    Posted in Business, Personal Narrative | 8 Comments »

    25 Stories About Work – “Don’t Hang Up” and the Recruiter from Detroit

    Posted by Carl from Chicago on 19th October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Champaign, early 1990s

    As I graduated from college in the early 1990s, I went through the interview process on campus. About half the companies really liked me and about half the companies hated me. I guess I was a polarizing interviewee but who knows I had little idea about what to expect in an interview or how to behave. I do remember buying a suit with my mother for about $400 which seemed like an astonishing amount of money at the time.

    In addition to the on campus recruiters, I also fielded some phone calls. Looking back before the age of cell phones it is amazing that anyone ever got in touch with anyone else – they must have called me in my dingy hellhole of an apartment in the 5 minutes that I happened to be there in between class, prepping for the CPA exam, and going out drinking. I guess we had an answering machine but I’m not even sure about that and my roommates at the time weren’t exactly the most reliable.

    I was enamored with the idea of work and getting the heck out of Champaign so I was like a happy puppy when anyone called. The joke is that I would select the last recruiter to call.

    One day I did receive a call: Hello. I’d like to talk to you about a job opportunity in the transportation industry, he said. I was interested. I was always interested. Then he said something I’ll never forget.

    The job is in Detroit. Don’t hang up!

    The recruiter combined both sentences into almost a single thought, with urgency, because he apparently was used to people instantly hanging up as soon as they heard the job opportunity was in Detroit.

    I didn’t hang up. But I surely did not pursue that opportunity. Because it was in Detroit, of course. No wonder that city went down the drain…

    Cross posted at LITGM

    Posted in Business, Personal Narrative | 18 Comments »

    Tributosaurus Plays “One Hit Wonders of the ’80s” at Copernicus Center in Chicago

    Posted by Carl from Chicago on 18th October 2014 (All posts by )

    Tributosaurus is a Chicago cover band that has been around over a decade and has covered an astonishing range of songs and artists. When they cover a song they go to great pains to sound as close as possible to the original song – this usually involves multiple guitarists to do overdubs which are tracked in the studio, horns, strings, and an array of drummers, synthesizers and backup singers. Here is their web site and they are a lot of fun. I have seen them do XTC, Pink Floyd, the Rolling Stones, Dire Straits, and most recently the “One Hit Wonders of the ’80s” at Copernicus Hall at Jefferson Park in Chicago (it is a few blocks off the blue line stop; we took the train and walked).

    Here they are at the start of the show. Later they bring on the horns, the strings, more backup singers, and more of everything. It was a lot of fun – they played a lot of forgotten songs like “This Beat Goes On / Switching to Glide” by the Kings which got the whole place rocking (it was a huge hit in Chicago) and also Dexy’s Midnight Runners with real banjo players.
    Read the rest of this entry »

    Posted in Chicagoania, Music | 6 Comments »

    25 Stories About Work – Office Hoteling and the Elusive Consultant Desk

    Posted by Carl from Chicago on 16th October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Chicago, the ’90s…

    When I first started out as an auditor I had a tiny cube that consisted of just a desk and a chair with a big phone in a giant warren full of other cubes. There was a big bay window that let in the sun and lights far overhead. I didn’t know anything and was happy just to have a place to call my own.

    How accounting worked at the time was that you were assigned to clients and were “on the road”. If you were in the office you charged a code for down-time and struggled for something to do. You could take a training class, do research in the library, or more often than not you’d be assigned some sort of drudgery administrative work. Most of the time I ended up photocopying our audit files when clients transitioned to new auditors, which is much more work than it sounds because you had to dis-assemble the work papers, copy them, and then re-assemble the files again. The copier tended to regularly jam and you soon learned how to take that copy machine apart, as well. Not a good use of a master’s degree…

    After a while the managers learned who was good and who wasn’t and I was constantly busy as a result. We worked and traveled all the time and often I had overlapping clients, meaning that tasks I couldn’t complete onsite piled up for me at the little cube while I was at a different client. This was before any concept of telecommuting and we didn’t even have our own laptops. The only way to get work done was to show up at the office (on Saturday or Sunday, since I traveled all week) and do the remaining tasks.

    One time our office engaged in some sort of ISO process and they decided that having a “clean desk” was mandatory. So the (usually worst) staff that were in the office packed up everyone’s desk and sent it off site so that when the office tour occurred, my little rat cube was completely clear. Thus when I showed up on a Sunday a couple of weeks later to follow up on some annoying task from a parallel client, all of my papers were gone and that was an entirely wasted day. The fact that I still remember this over 20 years later shows how angry I was at this bureaucratic stupidity.

    Read the rest of this entry »

    Posted in Business, Chicagoania, Personal Narrative | 6 Comments »

    25 Stories About Work – New Mexico Is Part of the United States

    Posted by Carl from Chicago on 11th October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    El Paso Texas, the ’90s…

    I supported a financial analytics system for a utility based in El Paso, Texas. Before I visited El Paso for work I knew virtually nothing about the area, the economy, or the people. One of the most interesting and unexpected benefits of my career was the opportunity to extensively work in areas of the USA that I never would have visited otherwise.

    One thing I did know is that 1) Texas has its own electricity grid that ‘walls it off’ from the rest of the USA called ERCOT 2) the El Paso area was “outside” of that grid. Thus while Texas may be its own separate country in their mind, El Paso was something else entirely.

    Another realization when you are working in El Paso is just how damn big Texas is. It can take longer to drive from El Paso on the western side of Texas to Houston on the eastern side of Texas than to drive from El Paso to Los Angeles. It was also extremely hot and the sun was blazing; some of the women brought umbrellas to shield themselves from the noon-day sun.

    The managers I met in El Paso said it would likely make more sense for El Paso to be part of New Mexico, rather than Texas. Many of the managers lived in New Mexico. A funny story they told was how many Americans believed that New Mexico was NOT part of the United States, and stories like this were collected in the back page of a local magazine and they were often hilarious.

    While flying to New Mexico one day I sat next to a gentleman that was frequently in El Paso for business. At the time, Ford Expedition SUVs were all the rage. He said that the last three times he visited El Paso, he selected an Expedition from the local rental car affiliate, and the car was stolen (and likely driven over the border into Mexico). I didn’t ask him why he was so stubborn and kept renting them.

    Read the rest of this entry »

    Posted in Business, Personal Narrative | 5 Comments »

    25 Stories About Work – Brooklyn Before Gentrification

    Posted by Carl from Chicago on 4th October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Brooklyn, New York City, the ’90s…

    I was assigned to do a regulatory audit of a large utility in Brooklyn, New York, in the 1990s. At the time Brooklyn was nothing like it is today. When I got off the plane at LaGuardia and hailed a cab…

    Me to the Driver – I want to go to Brooklyn. The Driver – Hell no, I’m not driving to Brooklyn

    After I finally convinced a cab driver to take me to Brooklyn (with much New York style yelling), when he dropped me off in front of the office building, he would whip the wheel around as fast as he could and do a U-turn right in front of the facility and high-tail it off to the highway to get out of Brooklyn. They couldn’t get out of the neighborhood fast enough.

    The utility was based at what appeared to be the only newer office-type building in Brooklyn. There were NO hotels that you could stay in Brooklyn at the time. We stayed in Manhattan and took the subway to work every day. We seemed to be the only boring white accountant-type people in suits going TO Brooklyn in the morning and we were the same distinct minority returning to our hotel every evening. Our partner onsite was kind of distracted so we had to stay on him to get out of work at 5pm so we weren’t taking the subway at night because that seemed to be a dicey proposition.

    Whenever there is a strike at a utility the union guys who read meters and make service calls walk off the line and management comes out to do essential tasks (along with other people that they hire). Thus the management people that we spoke with had harrowing tales of visiting completely dilapidated and burned out homes throughout the borough while they were on strike duty. Management seemed to live everywhere except Brooklyn and it made sense why – there were even a few who lived in Pennsylvania and made epic commutes to and from work daily.

    One manager talked about a scam where people wrote checks to the utility to pay bills and often they used a 3 digit acronym rather than spelling the whole utility. He said one of the customer service agents took those first three digits and added a last name and opened a bank account themselves under that combined name and took the checks and deposited them, running off with the money. We laughed a lot because that seemed like a scam that was doomed to fail after a while but a bit clever.

    There were no cabs in Brooklyn. You had to hire a “car service” which was usually a completely beat up Chevy Impala or the like driven by someone who spoke zero English. They usually had no idea how to get to the airport so I had to give them directions. A few times I was very scared that the car would literally fall to pieces while we were driving; they were probably old taxis that had given up the ghost and given a second, desperate life through this method

    One Monday morning when I was flying in I felt dizzy and ill and when I got onsite in Brooklyn at the only standing office building I came down with the flu very badly. I kept throwing up in the stall and getting progressively weaker. I was the only person onsite from my company and didn’t know the client people well enough to count on them to take care of me so in the few minutes between throwing up I somehow got back to Manhattan (probably via the subway, I don’t remember) and arrived at my hotel early. For some reason I remember this clearly – the band Rancid was pulling up and their hair was spiked up and they had real “rock chicks” with them in miniskirts and fishnets and covered with tattoos right when I arrived. They said my room wasn’t ready yet so I told the clerk “that’s fine, I will just projectile vomit onto you” and amazingly they got me a room right away. I just sat in there and was sick for a few days and then flew back to Chicago. That was not a productive week at all, obviously.

    Today Brooklyn has changed immensely and seems to be almost completely gentrified. I even have friends that I visit there and it is quite charming. It is amazing to think of all these changes that have occurred since I first went there in the early 1990s.

    Cross posted at LITGM

    Posted in Business, Personal Narrative | 4 Comments »

    25 Stories About Work – Industrial Decay

    Posted by Carl from Chicago on 3rd October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Somewhere in a Northwest Indiana formerly industrial city, the ’90s…

    We had a utility client in Northwest Indiana. The city used to be a large industrial town but had been hit hard by various plant closings and also the rout of the US steel industry in the ’70s and the ’80s. A friend of mine joked that you wouldn’t be surprised to see a dinosaur walking around the abandoned ruins of the nearby towns and city. For some reason I thought that was really funny after working there for a while.

    At our client they had multiple buildings that were connected by walk ways that were sometimes rounded or with all around glass. We called them the “habitrail” just like the hamster homes you could buy for your pets.

    The work onsite at the client was grim. I was given the least exciting areas to audit, the balance sheet and plant accounting. The balance sheet had assets that were not documented that were stagnant for years. At that point in auditing all you did was to re-word the notes from the prior year accounts and then put them back in this year’s file. After just a few hours as a novice auditor I pointed out that the notes didn’t make sense and started to do a bunch of new analytics when they told me to stop and just gave me something else to do. This is where you get the joke

    Why did the accountant cross the road? Because they did it last year.

    If you tell that joke to an accountant I am telling you they will laugh their heads off. It isn’t really funny to anyone else but it sums up the drudgery of what auditing used to be.

    One day the partner came out. Now we were all packed in a grimy little room. These were also the days when you could smoke like a chimney in the office and we all wore wool suits so I might as well have smoked 3 packs a day too. I stunk. It was after noon and I was hungry and I broke the silence by asking if we were going out to lunch. The whole room swiveled their heads at me and I got a tongue lashing later from the manager. I wasn’t supposed to talk or ask any questions while the partner was on site. Live and learn.

    Driving to Indiana from downtown Chicago was a long effort. The air conditioning in my car wasn’t great so I’d usually just drive in a T shirt and change when I got near the facility. One time I was pumping gas in a gas station nearby when the auto shut off didn’t work and I got gasoline all over my suit. That did not make for a pleasant afternoon of work.

    Another time when I was pumping gas a deranged, toothless local came up to me with his arms waving.

    Don’t sign the deed! he screamed. Don’t sign the deed!

    I didn’t.

    Cross posted at LITGM

    Posted in Business, Personal Narrative | 13 Comments »

    25 Stories About Work – Plains Blizzard

    Posted by Carl from Chicago on 2nd October 2014 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    Somewhere in Iowa, the ’90s…

    I was an auditor for a long since merged together utility. We used to fly in and out every week, leaving Sunday night (in your suit, in case your luggage was lost by the airlines) and leaving the office at 5pm Friday and driving to an airport 3 hours away to arrive home about 10pm Friday. We did this every week for the “busy season” which lasted about 3 months or so.

    For Thanksgiving weekend one time we left on a Wednesday. A giant storm was coming up over the plains as we drove across Iowa into Nebraska where the airport was for flights into Chicago. At the time we didn’t really have cold weather gear, we just had long wool coats and leather gloves to go over our suits. We didn’t even have boots, just work shoes.

    We stopped at a gas station and the wind was really whipping across the plains. When I got out to pump gas I was almost knocked flat on my back. While shivering in the car after pumping gas I told them we ought to turn back and just give up for the night and stay in Iowa.

    I was the lowest ranking guy so I was overruled. There were obvious reasons why everyone wanted to get home for Thanksgiving and away from work in Iowa.

    Read the rest of this entry »

    Posted in Business, Personal Narrative | 10 Comments »

    The Restaurant and Bar Business

    Posted by Carl from Chicago on 27th September 2014 (All posts by )

    I am far from an expert on the Restaurant and Bar Business segments but as a long time resident of Chicago in various areas packed with these establishments from Wrigleyville to Bucktown to River North I am at least a frequent regular qualified to throw my 2 cents in. I hadn’t thought too much about the economics of this until I talked to a friend who recently opened two great pizza places where he is the owner about what you get when you buy a used restaurant.

    You get nothing… you have to re-model and start over the food concept. And when you sell, the next guy does the same.

    What makes a good restaurant as a business? There are a lot of variables and I am only speculating, but certainly timing and location are key elements. For instance you have the Twisted Spoke, a bar on Grand Avenue in what used to be a pretty sketchy part of town that is rapidly gentrifying, and they have the iconic “skeleton on a motorcycle” on permanent rotation in front. This bar has survived for a long time with a mix of hipster / biker cool, an astoundingly good drink / beer mix, and surprisingly good food and interesting / witty / iconic employees. I’d bet that back in the day this place was actually full of bikers but nowadays the crowd looked like the usual hipsters in plaid shirts. And don’t forget the enormous benefit of a rooftop – it astounds me how many bars / restaurants ignore the fact that Chicago people LOVE to sit outside during the few nice days that we receive every year and they drink like fish and eat until they can’t even move.

    Read the rest of this entry »

    Posted in Business, Chicagoania | 35 Comments »

    Sign of a New Peak for Stocks?

    Posted by Carl from Chicago on 20th September 2014 (All posts by )

    Back in the woeful years of the dot.com boom and bust I worked for a company with a dubious distinction. The value of that company in the stock market was less than the value of the cash we had on our books. What the market was essentially saying is that the sum total of all our efforts as employees was NEGATIVE – we would be worth more if we just shut down immediately and gave back the cash to investors. The fate of that company, of course, was to go bankrupt.

    Today there are some other major signs of froth in the market. Yahoo is a classic web / advertising / technology stock with a solid market capitalization of $40 billion. Yahoo’s CEO, Marissa Mayer, was a Google alumna and has been receiving a lot of press for her intelligence and drive to change the company, as well as her good looks.

    Screen Shot 2014-09-20 at 8.43.59 AM

    However, all is not as it seems.  The primary value for Yahoo isn’t its online advertising, email, or users – it is the stakes that they amassed in the hot Chinese e commerce company Alibaba (NYSE: BABA) and also Yahoo Japan.  In fact, the value of Yahoo is less than the value of these stakes, which are approximately $45B, partially due to the reason listed in this Bloomberg article:

    While the market value is large for Yahoo’s Asian assets, that doesn’t necessarily reflect the value available to investors and the company because of taxes, said Ben Schachter, an analyst at Macquarie Securities USA Inc. Yahoo, which would have made $8.3 billion by selling Alibaba shares at the IPO, only reaped around $5.1 billion after taxes.

    Taxes are ‘‘one of the big issues,” Schachter said.

    While it is true that $45B in investment value isn’t worth $45B because of the after-tax implications, it certainly implies that the market isn’t valuing Yahoo at very much at all.  It is also possible that the market thinks that Alibaba is over-valued at its current price of near $100 (after a huge run-up from its IPO price of $68, another huge sign of froth in the market) but the two stocks will generally track closely together now.  Yahoo is sort of a broken “tracking stock” for this value.
    Read the rest of this entry »

    Posted in Business, Economics & Finance | 7 Comments »

    Riot Fest Chicago 2014

    Posted by Carl from Chicago on 16th September 2014 (All posts by )

    Riot Fest in Chicago was held over three very cold and rainy / muddy days in Chicago’s Humboldt Park in September. I went with a friend on Friday which was cold, rainy, muddy and insane and on Sunday when the weather was nice (still cold) and the mud had somewhat hardened. Riot Fest is more of a fan-friendly (cheaper) Lollapalooza with a bigger dose of punk / emo bands and without any of the EDM flavor that you get from Lolla (and get on a massive scale elsewhere). It was also held in Humboldt Park which is relatively far afield for the more gentrified classes but actually is closer to where the younger fans of this music might actually live and work. For me, it was an opportunity to see some of the bands I like such as Social Distortion, Mastodon, Slayer, Primus, Weezer and the Afghan Whigs. Definitely skewing a bit older for certain.

    Here is Gwar! I wasn’t a huge fan of Gwar before seeing them live but they put on an awesome show that needs to be seen to be believed, where they kill a giant dinosaur and banter with the crowd in a completely disturbing manner. At one point they wanted everyone to put their heads down for a moment of silence (their former front man died recently) but then their deranged emcee said that everyone was looking down for a crack rock that the band had dropped since they couldn’t do this sort of stuff sober. They also sprayed everyone near the front with fake blood which is their trademark – many fans throughout the park for the rest of the day looked a bit sunburned from the residue of their pinkish hue thanks to Gwar.

    Riot Fest had great food and it was very reasonable. They had a Cevapcici stand where I had a great Serbian sausage for about $7 and all kinds of different items, not just the usual “festival” type stuff. Fortunately they set up most of these stands on the roads that curve through the park so they didn’t sink into the mud.
    Read the rest of this entry »

    Posted in Chicagoania, Music | 6 Comments »

    Massive Disruption to the Cable Industry Coming – Part II

    Posted by Carl from Chicago on 9th September 2014 (All posts by )

    Recently I wrote about the impact to the cable industry that is coming in the form of Microwave Fixed Wireless here.

    While on vacation in Door County I noticed a small store front office in Bailey’s Harbor for Door County Broadband. The first thing I thought of is how would a company like this operate out of a small storefront with just one truck (parked outside)? Then I realized that this firm is the local upstart providing Microwave Fixed Wireless against the incumbent phone / cable company in that region, Frontier. Unlike the local phone / cable company (who really are one and the same nowadays), you can run a microwave fixed wireless broadband company with few employees because you don’t have to pay for all the same physical infrastructure (telecom poles, physical connections) when you are doing a wireless model; you just need to 1) get the physical infrastructure (towers) in place and then 2) hook up the dish in the homes and point it at the tower. This model needs far fewer “boots on the ground” than the traditional model.

    While researching this further, I came across this document called

    America’s Broadband Heroes:
    Fixed Wireless Broadband Providers
    Delivering Broadband to Unserved and Underserved Americans

    This document is clearly biased in favor of the upstart fixed wireless providers, but has many interesting and sourced facts about the industry and is highly recommended reading.

    While wireline and mobile wireless carriers focus on regulatory gaming and manipulation of the Universal Service Fund to benefit their bottom lines, many Americans are left without access to broadband services because they reside in places that are deemed to be unprofitable by traditional carriers. Even more Americans have substandard or overpriced broadband access and no alternatives for obtaining better service because of the lack of competition in the broadband market. It is clear that the current system is broken, and the absence of competition, abuse of USF and the lack of access to critical network facilities for competitive entrants puts our nation into a position of disadvantage compared to other OECD countries.
    Read the rest of this entry »

    Posted in Big Government, Business, Economics & Finance | 10 Comments »

    Lazy Sunday – And Paperbacks As Early Web Pages

    Posted by Carl from Chicago on 2nd September 2014 (All posts by )

    While on vacation I stumbled across a bookstore with new and used books.  There are so few bookstores nowadays that I went inside and they had an excellent selection of bestsellers and obscure choices.  I paid for my purchase and, on the way out, noticed a big box full of the Ballantine’s Illustrated History books that originally retailed for $1 (I have some that must have come from England because they were one pound) and had to select a few for lazy Sunday reading.

    These books come from a series and I have read many of them over the years.  I picked up the Barbarossa 1941 book and it appears to be one of the first titles written by John Keegan, the famous author of “The Face of Battle” and many other works.  For such a small book it is able to distill the essence of that fateful year with great maps, photos, pithy text, and diagrams.

    Certainly not all of these books hit that high mark; but many are fantastic.  Since they use every inch of the paperback for superb graphics and well placed text, to some extent they should be considered a work of art.

    I looked a bit and Ian Ballantine was a visionary; on Wikipedia they mention that he was one of the first businesspeople to realize the power of the paperback book and how it could open the world to so many more readers.  He produced the first softcover of “The Lord of the Rings” and helped to popularize modern science fiction.
    Read the rest of this entry »

    Posted in History, Internet | 10 Comments »

    Massive Disruption To The Cable Industry Coming

    Posted by Carl from Chicago on 28th August 2014 (All posts by )

    Things that are often obvious in hindsight don’t seem so clear at the time. For instance I didn’t understand why anyone would want to send around a PDF file when you had Microsoft Word. And it wasn’t obvious to me that mobile phones would completely displace land lines.

    We are about to see something similar happen to the cable industry, which is at its oligopolist apex right now.  I don’t know when or how long it will take to have an effect, but in the end I believe that the outcome will be significant.

    MICROWAVE FIXED WIRELESS

    For large condominium buildings in Chicago, it is now the norm, not the exception, to go with Microwave Fixed Wireless for internet in the building, rather than fiber. Here is one company (I just found them on the internet, don’t know anything about them) that attempts to describe the benefits:

    Telephone and cable companies have been positioning fiber optics as the ultimate internet technology for some time, but the truth is that fiber has some inherent disadvantages that have been addressed by wireless microwave-based internet solutions. Experts across the globe are starting to acknowledge what the engineers at JAB Broadband have long been touting: microwave is a faster, lower latency, lower cost alternative to fiber and you don’t have to wait until someone decides to light up your building.

    Not to be confused with the appliance you use for heating your leftovers, microwave wireless networks transmit and receive radio signals through the air enabling high-speed data transmission with very limited latency. Benefits include:

    Limited infrastructure required on site
    Faster speeds because data travels over a direct path (point-to-point)
    Low logistical and operation costs
    Expanded availability
    Low latency

    There are many companies in Chicago that provide this service for condominium buildings and businesses. You need to have a rooftop with line of sight access to a provider and you put a dish on the roof. This dish connects to the main network of the building and is distributed just like internet service that you’d receive from a standard fiber optics provider (such as a cable company). The traditional downside of microwave transmission was unreliability – if the line of sight was obscured by heavy rain, for instance, then you don’t receive any signal. This happens today with DirectTV if the weather is bad – you receive the “all or part of this program did not record” message when you pull it up on your DVR (or it is jumpy and impossible to watch if you are looking at “live” programming). Note that DirectTV has a much more complex problem to fix with its satellites than a condo building does in Chicago because their satellites are in orbit rather than nearby with simple line of sight needs, so these problems are conceptually similar but actually very different in terms of difficulty to solve.

    The reliability issue has mostly been solved and barring catastrophic weather, your point to point wireless internet is as reliable as fiber brought into your building. Don’t forget that fiber, too, can be cut by local construction crews and other means and is also susceptible to failures of various sorts.

    Once you cut over to Fixed Wireless (microwave transmission), you have effectively moved out of the cable orbit as far as internet service.  Many facilities offer 10 meg, 50 meg, and even 100 meg connections for each condo unit, which means that the provider needs to bring that speed times the number of units with some overall reduction since everyone won’t be using the full internet all the time.
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    Posted in Business, Chicagoania | 10 Comments »

    Head in the Sand on Dams and Hydropower

    Posted by Carl from Chicago on 24th August 2014 (All posts by )

    The popular (untrue) image of the ostrich as a bird that puts its head in the sand came to mind as a I read a recent NY Times article titled “Large Dams Just Aren’t Worth the Cost“. This article describes the usual culprits that plague dam construction:

    1. Cost overruns
    2. Dams take much longer to construct than originally planned
    3. Dams displace local residents (many in impoverished third world countries) who rarely thrive in their new locations
    4. Dams that are paid for with foreign loans (for many years the World Bank provided funding) often do poorly because the dam revenues come back in local currency and the loans are denominated in dollars; thus even if they hit their “nominal” returns, they don’t reach their “planned” returns when adjusted for currency depreciation

    These are all true objections to dam construction. However, these same criteria can be applied to virtually any energy construction project, from coal plants to nuclear plants to major LNG efforts.

    One key point that the article completely misses is that dams don’t require spending for “fuel” once they are up and running, and often it is fuel and distribution of fuel that bankrupt energy companies in the third world. The dam requires rain / water to generate power, and if this changes significantly, it can change the amount of power provided, but this is still generally better than “nothing”.

    There simply would not be electricity in many areas of the third world without hydropower, and the choice really isn’t between other alternatives and dams, it is a choice between power and no power. Once a dam is built they often can be run with a few individuals and if there are major problems you can bring someone in to fix them. You don’t need to find coal or fuel oil (which moves in price and is denominated in dollars that the country often doesn’t have). On the other hand, complex machinery and distribution systems can’t be left in the hands of areas with revolutionary governments and broken economies because in short order they are often taken apart and destroyed.

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    Posted in Economics & Finance, Energy & Power Generation, United Nations | 23 Comments »

    Florence, Italy – Il Duomo

    Posted by Carl from Chicago on 18th August 2014 (All posts by )

    In April I travelled to Italy. We landed and took off from Florence. I was astonished by the beauty and cleanliness of Florence, at least in the places we visited near downtown and in the hills above the city.

    While in Florence the size and scale of Il Duomo is staggering. I recommend reading in detail about the construction of this amazing cathedral since it took centuries and was extremely complicated and advanced for its time.

    Read the rest of this entry »

    Posted in Europe, Photos | 9 Comments »

    Investing Related Items

    Posted by Carl from Chicago on 3rd August 2014 (All posts by )

    Over at Trust Funds for Kids I’ve been updating the portfolios and researching relevant topics for detailed analysis.

    One interesting item to me is ADR’s or American Depository Receipts, which represent foreign stocks trading in US markets. “Sponsored” ADR’s trade on NYSE and NASDAQ and “unsponsored” ones trade on the OTC or “pink sheet” markets. Recently one of my stocks (Siemens) went from a sponsored to non-sponsored ADR status and I started researching it here.

    I also researched the impact of currency moves on a portfolio, focusing on the Australian dollar vs. the US dollar and its effect on a particular Australian Bank Westpac. It is interesting to view the two elements in an intertwined fashion, since the US dollar was a poor performer over the last 5 years relative to many other currencies.

    Finally I look a bit at performance over the last year and marvel about how easy it is to assess performance these days with free graphing and overlay tools, compared to the manual effort in past years’. It still is difficult to always properly factor in dividends and the timing of cash flows (investments), but that’s a different story.

    Cross posted at LITGM

    Posted in Business, Investment Journal | 5 Comments »

    Indonesia’s New President is a Fan of Metal

    Posted by Carl from Chicago on 26th July 2014 (All posts by )

    I’ve had a long relationship with heavy metal. I remember being a kid for a show at the Aragon Ballroom back in 1986 – I think it was Yngwie Malmsteen (who is often known as Yngwie “F@cking” Malmsteen for his reputation as being a jerk) and we waited outside all day for a general admission show. At that time the Uptown neighborhood was dangerous and populated at all hours by drunks and bums. Some of the more clever fans had stolen lawn chairs along the way so they’d have something to sit on during the long hours of waiting. We watched the minutes click by oh so slowly at a big bank across the street. And of course everyone in line was drinking or smoking or doing something else to pass the time. Many people passed out not once but twice in line, shook themselves off, and went back to what they were doing (one guy in a big mud puddle). Later a kid had a limo drop him off in front of the venue and walked out towards the line. That was a big mistake as the entire crowd was jeering him as one. A few homeless people came by asking for change and someone had the idea to toss a quarter at them and soon the whole line was hurling their change in a shower. Towards the end they installed barricades to segment the crowd so that the entire line of a couple thousand people wouldn’t all surge forward at once when they began letting people into the venue. At that point you were penned in like veal in a cage packed next to other leather jacketed rowdy and drunk fans. The grizzled Chicago street cops eyed the crowd with disdain… you could tell that if they had their way this whole bunch of bums and idiots would get taken into custody…

    Over the years I don’t go to as many metal shows as I used to and won’t spend all day in line, obviously. But I still feel affection towards the music and the no-compromise attitude of those that have stuck with it regardless of the fact that it gets no radio airplay, little iTunes action, and is on the fringes of the “general” entertainment landscape. Of all the genres of music, metal can live on because it doesn’t need any of these things, just fans who are dedicated, and these fans revel in the fact that they are outsiders.

    Indonesia just elected a new president, a “man of the people” named Joko Widodo who took on the establishment tied to the former dictator. I am astonished to see that he is apparently a fan of metal, and even a fan of bands like Lamb of God, whom Dan saw recently in Madison and described their show as “insane and sonic”. All of this comes from this Noisey article (Noisey is part of the awesome Vice media empire). It is unthinkable that a US presidential candidate would ever admit to being a fan of metal, especially the non-cartoony metal bands like Lamb of God. Lyrics are NSFW (if you can understand them). Here is a clip

    Cross posted at LITGM

    Posted in Music, Personal Narrative | 2 Comments »

    High Rise Construction Views – And Taking Down A Crane

    Posted by Carl from Chicago on 21st July 2014 (All posts by )

    In River North, during the many years we’ve lived here, the skyline has been transformed with the addition of new high-rise buildings. Construction slowed after the 2008-9 crash, but is back now with a vengeance. A new apartment building is being built near my condominium. This is a view of the building while the construction workers were pouring concrete on the roof (you can see the concrete pouring arm) the same night of the “Derecho” storm which hit Chicago at the end of June.

    I’ve always wondered how they take down the crane and we got a chance to see it up close and personal. The process took all weekend, and they closed down a nearby street on Saturday and Sunday while they dismantled the crane. They put the metal “box” (it is steel colored) with three sides around a vertical crane “segment” and then the crane pulls that segment out through the gap. You can see the crane holding the segment if you look closely – which it then lowers to the ground.

    Read the rest of this entry »

    Posted in Chicagoania, Real Estate | 2 Comments »

    Adding to Illinois’ Debacle

    Posted by Carl from Chicago on 17th July 2014 (All posts by )

    This billboard is in my River North neighborhood in Chicago. It is an advertisement for a mall and entertainment location in Rosemont, a small city near O’Hare airport.

    Rosemont was profiled by the Chicago Tribune in this excellent article. A single family has run Rosemont for generations, and they benefit from a levy on taxi rides from O’Hare and spend this money on no-bid contracts for friends, family and politicians as well as large entertainment complexes underwritten by large amounts of debt.

    The suburb is digging itself deeper into debt to subsidize a new bar district, professional softball stadium and outlet mall. With $370 million in taxpayer-backed loans outstanding, Rosemont has one of the top debt loads in the Chicago region.

    Another Chicago suburb, Bridgeview, hosts a stadium for the Chicago Fire, a major-league soccer team. Their debacle is chronicled here, in a typically great Bloomberg article.

    The mayor of Bridgeview, Illinois, said building a taxpayer-financed arena for the billionaire owner of Major League Soccer’s Chicago Fire would bring hotels and restaurants to his suburb. Instead, the town has more than doubled property taxes and may raise them again to pay more than $200 million in stadium debt.

    One of the big problems in Illinois is that we have so many various overlapping public bodies, many with the ability to issue debt and all of whom have expensive board members, employees, and often public contracts doled out to associated cronies. This article, from the “Illinois Policy” web site, describes the myriad overlapping public entities in the State of Illinois and how we dwarf ALL states and especially neighboring (and much better managed) states like Indiana.

    Illinoisans suffer from the second-highest property tax rates in the nation.

    Their state is the third most corrupt in the nation.

    And driving this expensive and corrupt reality on the local level is the fact that Illinois has more units of local government than any other state in the nation. With 6,963 units of local government, Illinois beats its nearest competitor by more than 1,800.

    When Illinois finally hits the wall, and we won’t be able to issue new debt (and thus an immediate fiscal crisis will occur), we will have to have a reckoning with all of these various entities, each of whom has their own debt problems and the ability to create NEW problems by issuing MORE debt. On one hand, the market will constrain their ability to sell debt by the fact that these insolvent entities survive through the “implied” promise that they will be bailed out by some higher power, whether that is a county, state, or Federal government.

    The act of unwinding all of the problems of the inter-related corrupt and insolvent entities will be a herculean task, made even more difficult by the fact that there will be little incentive for the politicians to solve the crisis if the end result is that they won’t have these same public entities for no-bid contracts, jobs for themselves, and their campaign workers and donors once the clean-up is complete.
    The only thing for certain is that the lawyers in the state will feast at the trough of lawsuits from all parties. They just need to make sure that they find a way to get paid themselves on a timely basis…

    Cross posted at LITGM

    Posted in America 3.0, Big Government, Chicagoania, Illinois Politics | 11 Comments »

    Incentives and Economics

    Posted by Carl from Chicago on 14th July 2014 (All posts by )

    A few years ago I went to Norway and had a great time. In this post I described how expensive everything was in Norway due to their highly valued currency (tied to oil riches) combined with the relentless decline of the US dollar (tied to ZIRP and other dubious economic moves). In the simplest terms, a fast food meal or a beer in Norway cost over $20 USD which is complete madness.

    Business Insider discussed the Scandinavian economic experiment, where high taxes are applied to goods and services in order to fund a vast social safety net. From the article:

    In Norway, a burger and fries at a fast food joint will set you back $23. A six-pack of warm grocery-store beer is nearly $30.
    These hefty price tags are due, in part, to high wages for low-skilled service jobs. But high taxes play a role too.
    Most products have a 25 percent value-added tax, which means that $5.50 of the cost of that burger goes to fund Norway’s generous social programs.
    As a visitor, you get little for the added price. But, as a resident, your daily spending helps to fund an expansive package of benefits, including health care, child care, high-quality education, pensions, and unemployment insurance.

    Some are now proposing this high-cost method, with large taxes embedded in everyday prices, as a solution to the inequity in incomes and wealth that is discussed widely in politics and economics today.

    From the perspective of someone who is highly interested in economics and tax policy, my two rules of thumb are:
    1) that the tax policy raise the money that it intends to raise
    2) that the tax policy not significantly distort economic activity

    Any society that implements high taxes such as Norway needs a comprehensive surveillance model in order to collect these taxes. It is difficult to avoid taxes that are broadly assessed on fast food, for instance, because each corporate location will set up cash registers and controls to remit these taxes onto the state. The same types of processes can be installed in liquor stores, formal bars and nightclubs, grocery stores, and restaurants.

    In a less-homogeneous society such as the USA, we already have major problems with tax evasion on cigarettes and likely liquor, and these are in responses to our sales taxes. The problems would be compounded if we placed value added taxes on all goods at a higher level and on services such as restaurants, hair care, etc… Smuggling would become rampant and informal or barter methodologies would increase in size and scope. These sorts of costs would have to be applied across the USA or some areas would become uncompetitive and see an out-migration of economic activity, starting with incremental additions (no one has opened a new manufacturing plant in Illinois in years, for instance) and eventually leading to the lock, stock and barrel out migration of existing industries (such as the exodus of car manufacturing out of the Midwest and California to the American South).

    Read the rest of this entry »

    Posted in Big Government, Economics & Finance, Public Finance, Taxes | 33 Comments »

    Parrot AR.Drone 2.0

    Posted by Carl from Chicago on 21st June 2014 (All posts by )

    Recently I had a chance to operate a Parrot AR.Drone 2.0. The drone is a “quad” helicopter with four rotors that you can control through your iPad. I was extremely impressed with the technology and had a lot of fun operating the drone. Below is a photo of the drone in flight.

    And below is a picture of the drone at rest. The “bumpers” that protect the rotors are not being used because we are operating the drone outside free of obstructions.

    The drone represents a remarkable confluence of various technological capabilities into a small and cost efficient package. The drone has its own wi-fi network that you use to connect your iPad to the device. Thus you are basically leveraging wi-fi to provide a network and this is a likely range limitation on the helicopter, although due to other more pragmatic concerns this is not as significant a problem as it may appear (the craft does not do well in modest or high winds, and only has about 12 minutes of battery time so long range flight is effectively infeasible).

    By using your iPad as a control, the manufacturing and costs of the quad helicopter have dramatically been reduced. You do not need a dedicated device with unique controls to master – simply load software onto your iPad and you are off and running. You are also able to easily upgrade the controlling software on your device (just like updating an app) as well as update the quad helicopter itself via that same method.
    Read the rest of this entry »

    Posted in Diversions, Tech | 2 Comments »

    My Books and the End of My Printed Books

    Posted by Carl from Chicago on 7th June 2014 (All posts by )

    An important event in my household is the spring planting of everything that is going into our garden on the balcony of our condo. They are grown inside under a grow light (mostly, except for items like lettuce and carrots) and then they get put outside.

    The tomato plants grow by leaps and bounds! So what is used every day to keep up with their vigor? Why my old books, of course.

    There you can see the usual suspects on my nightstand… some WW2 (Van Der Vat is a great author), of course America 3.0 by our good friend Michael Lotus, and “Africa’s World War” on the Congo. Then you have a couple of architecture books and finance books like the classsic “The Myth of the Rational Market”.

    I’ve switched over (mostly) to the kindle now and haven’t been buying new books in hardcover. I bought a book on New Yorker cartoons in hardcover since I figured that would be the type of coffee table book that people might actually pick up and look at. I also might buy an occasional architecture or infographic book in softcover or used, as well. But that’s about it.
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    Posted in Blogging, Book Notes, Business | 18 Comments »

    I Give Advice… And They Don’t Take It

    Posted by Carl from Chicago on 1st June 2014 (All posts by )

    For many years I worked as a consultant across a variety of industries. While there are many ways to describe the type of work I did, my favorite (when talking to a teenager or child) was

    I give advice, and they don’t take it

    This article from Today’s NY Times titled “Why You Hate Work” provided a pithy antecdote that summarized this situation:

    Several years ago, we did a pilot program with 150 accountants in the middle of their firm’s busy tax season. Historically, employees work extremely long hours during these demanding periods, and are measured and evaluated based on how many hours they put in.

    Recognizing the value of intermittent rest, we persuaded this firm to allow one group of accountants to work in a different way — alternating highly focused and uninterrupted 90-minute periods of work with 10-to-15-minute breaks in between, and a full one-hour break in the late afternoon, when our tendency to fall into a slump is higher. Our pilot group of employees was also permitted to leave as soon as they had accomplished a designated amount of work.

    With higher focus, these employees ended up getting more work done in less time, left work earlier in the evenings than the rest of their colleagues, and reported a much less stressful overall experience during the busy season. Their turnover rate was far lower than that of employees in the rest of the firm. Senior leaders were aware of the results, but the firm didn’t ultimately change any of its practices. “We just don’t know any other way to measure them, except by their hours,” one leader told us. Recently, we got a call from the same firm. “Could you come back?” one of the partners asked. “Our people are still getting burned out during tax season.”

    This brief example has it all:
    1) the client has diagnosed the situation (people are getting burned out and quit)
    2) the consulting firm develops an alternative course of action
    3) the pilot was successful
    4) the client disregards the recommendation (over some period of time) and is back where they started

    While there are many jokes about consultants such as “they borrow your watch and tell you the time” it is important to note that every consultant needs a client and the clients are the “root” of the problem. Why commission a study if you don’t intend to follow through on the results?

    Lots of reasons. For starters – the act of “trying to do something” or “conducting an analysis” buys time and inaction, which is a precious commodity at most companies. It is very difficult to get something done, and it is even MORE difficult to get something done when an alternative hypothesis is under way (such as a consulting effort). In the end, usually the client knows how to solve the underlying problem, but the effort that it would take and the corresponding rewards to those managers tasked with carrying out the solution is too meager to justify the organizational resistance that will occur.

    All of these organizational problems are compounded by short-term thinking; executives want results NOW, this quarter, not improved performance 2-3 years down the road. They may talk about the long term, but the short term consumes 90% of their waking hours, and the next quarterly earnings release. Changing a culture or implementing a wrenching solution that differs from the status quo 1) is hard 2) takes time 3) is met with systemic and subtle resistance at every turn. The final bullet in change internally are external events; even if you can somehow make progress against your current ills, a “new” external shock will take away the focus and organizational oxygen from YOUR issue unless you can implement a rapid and permanent solution (i.e. close something down, sell it, “burn the ships”) before your organizational capital melts away.

    Here’s the part where someone often asks “what’s the solution?” and tries to summarize it all up. I don’t know. It is hard enough to figure out the long term arc of consulting, a multi billion dollar business, and how it survives jibes and efforts to extinguish it, without trying to think about how to make it better.

    Generally the types of corporations that rely on consultants to do their thinking for them don’t last long, unless they are somehow protected from competition (government, non-profit, unionized, utilities, much of financial services, etc…). It is these sorts of enterprise, along with the dying, that provide much of the consultants’ income. You don’t hear Google and Amazon or even GE talk about how consultants are helping them; they solve their own problems. I guess this is the underlying solution – be a better company.

    Cross posted at LITGM

    Posted in Business | 4 Comments »