Sunday, 14 September 2008

Buckle Your Chin Straps

Lehman - Gone! Stepping up to the plate - AIG. On Deck - Merrill. Some or all of these businesses will continue to exist in some form or another, but they will be talking about this coming week in 50 years. There's been a lot of talk about which companies are "too big to fail" or "too interconnected to fail," which is all well and good, except when there's no entity liquid enough to prevent what's obviously become inevitable. I'm now fully prepared to watch an historic unraveling of our financial system. What seems hyperbole a year ago now seems at least assured, if not optimistic.

Rest assured that this is a long way from over, and that there are follow on effects which few if any have even yet considered. One of the most annoying things about this is that the people most directly responsible for it have been richly rewarded for their innovative financial prowess in unleashing this beast. Reading the Sunday Times today, there was a lot of vitriol directed at the ousted leaders and Fannie and Freddie and the pay packages they'll receive. $24 million or so between the two of them for misstating earnings and overseeing perhaps the most consequential mismanagement of the commonwealth in history. We get a bill in the billions, perhaps trillions, while they get checks in amounts that all of the people on your street, together, would be quite fortunate to earn in their careers. Yes, it's sickening, but that is of course just part of greater ills that will continue unabated. I'm feeling pretty pessimistic, if you haven't guessed.

Will the world learn anything from all of this? Certainly not. There's too much money to be made, and like the war on doping, there's more gain in the production than there is in the regulation. If you're a smart kid coming out of MIT with an economics degree and a huge quant background, you have the option of going into the private sector and making absolute asspiles of money or go work for the SEC or the Fed or Treasury or for some legislator who's on Finance or something and get paid nothing. Beyond the pay scale differences in the two scenarios, the risk taking side will always be willing to throw resources behind you. In all likelihood, the public sector side promises you reams of red tape and obstacles. The system learned nothing from the S&L bailout, nothing from the LTC bailout and nothing from the tech bubble. The world isn't set up to create and maintain the kind of institutional memory that's going to be necessary to prevent these kinds of things in the future.

During my ride today, I once again noticed the two projects on MacArthur whose funding has obviously been pulled. One is at the bottom of Mountain Gate, the other just past Brickyard toward Great Falls. Across from the one past Brickyard is a super high end development that's obviously stalled. Out River, there is another McMansion in a state of suspended animation. It's not going to be at all good for the neighborhoods to have boarded up hulks sitting there, idle. Really, there's nothing good about it. I don't think there was anything particularly good about any of these projects in the first place, but now that they've reached the state they're in, well it's really not good.

Speaking of riding, I got a lot of great mileage in this weekend. Quality rides both days. Climbing is still not good at all, but it's a lot better than it was. The long road back is turning into more and more of a "was" and less of a "gonna be" all the time. I had my first mechanical since I don't even know when today, the lock ring on my cassette got loose. That's not a great thing to have happen out in the middle of nowhere. Fortunately it was somewhat easily dealt with, using the blade of the flat head screwdriver to get some tension on the lock ring. A lock ring tool isn't really something you just whip out of your pocket on a ride.

Sponsor night is Tuesday. Among a bunch of staples that I need, I'm getting some new hubs to get my race wheels situation sorted out. I have a set of Mavic Open Pro rims from an old set of wheels with burnt out hubs that have 24f/28r drilling. With these I will pair a set of DT 240 hubs with DT Revolution spokes. Compared to the wheels I was racing with last year, these will shed almost a pound and have much nicer bearings. Compared to racing with my Powertap, the bike will be over a pound lighter. Scant bling value, but they should be functional as hell and really sweet.

Riding in the drops is getting more and more comfy all the time, aided by a somewhat vigorous core strength and flexibility program. My shoulders get tired after a time, but between the weight lifting that I'm doing and getting used to it, that should go away in short order. I think the biomechanics might be slightly improved by going a bit forward and higher with the saddle, which I'm going to try.


jim e said...

Why not sew-ups?

Contador looks as if will win the vuelta this last day in the mountains.

Gas jumpin' up... Banks going bust... and riding with Landis (did he do it?)... helluva weekend.

"The Return"(yours and Armstrongs) will make for some kinda '09.

Chuck Wagon said...

It's going to be an interesting week, that's for sure. I actually turned down a sales job at Merrill when we moved to DC 4 years ago. Who'd a thought that over that time construction would be more solid working at Merrill?

I wanted to do sew ups, but you can't get rims in anything less than 32 hole without spending a fortune. Rule number 1 - don't race what you can't easily afford to replace.

Haven't been following the Vuelta at all, but I guess it's fait accompli now, huh?

Gas is going to go nuts again, but it's refineries being off line rather than oil prices which are doing it.

I read early this morning that there are teams of strategists locked in rooms trying to figure out 'what ifs' for basically every scenario. To do it under the pressure they'll be under won't be fun, but a very interesting exercise. Except, of course, for it not being an exercise really.

GamJams said...

No PowerTap in '09? You buy one of Cannell's SRMs or something?

Chuck Wagon said...

Race wheels. I'll still use the powertap, although I haven't been recently since the pickup wire/holder thing got toasted in the mayhem - one of the staples I mentioned. But I don't plan to race with it except in races in which I have a specific training agenda or want to use for tests.