Sunday, October 31, 2010

The Bus repost

Can Obama war himself to re-election?

I am not suggesting, of course, that the president incite a war to get reelected. But the nation will rally around Obama because Iran is the greatest threat to the world in the young century
Brad has the take down,
Bush did it!

Saturday, October 30, 2010

License plate aggregators?

Most of north America's tollers have agreed to participate in developing a hub to clear license plate tolls - a key step to improving the reach of all-electronic tolling (AET). At least 37 toll operators including the biggest - MTA B&T, NY Thruway, New Jersey Turnpike, Illinois Tollway, 407ETR, Florida's Turnpike, Pennsylvania Turnpike, Harris County Toll, North Texas Toll, Ohio Turnpike, Oklahoma Turnpike, Bay Area Toll - are cooperating to develop a "License Plate Interoperability Hub" (LPIH). see list at bottom of this report

This from Toll Road News. Tollers want a central billing center to locate cars billed by license plate.  Unfortunately, there is going to be a big business tracking cars by license plate.

Traffic management in the UK

As these ‘professional’ drivers are using the road users in the UK contributing to its information pool, particularly business and commercial drivers. As these ‘professional’ drivers are using the road system more than any other sector of motorist, the regular and dependable data they collate is essential to the HD Traffic service. All TomTom LIVE satnav devices are equipped with a SIM (Subscriber Identity Module), which allows the vehicle’s position and speed to be anonymously fed back to the HD Traffic Centre. This gives accurate and regularly updated information on traffic flow across the entire road network. The data is then collated, analyzed and used for route planning.

That's TomTom, via Traffic Tehnology Their site. TomTom is in the company of Naveq/NXP or Skymeter; but I like their approach. Get the basic black box into as many vehicles as they can.

The traffic automation market is at the pivot point. The stimulus action we are looking for is a technology plan that makes the traffic bandwidth market liquid. Traffic bandwidth must be sold in units farther out in time and larger in size; and then remarketed.

There is one message this industry needs to produce to local transit districts, remember,  The rights they control today, along the roads, streets , parking spots,  and intersections, will gain utility fast as technology is added.  These companies add the technology, talk to them before you sell, but eventually do sell bandwidth in its liquid form.

Friday, October 29, 2010

John Kerry loses his mind

"It's absurd. We've lost our minds," said a clearly exasperated Kerry. "We're in a period of know-nothingism in the country, where truth and science and facts don't weigh in. It's all short-order, lowest common denominator, cheap-seat politics."
I do not want to confuse the old man, but we are in the middle of a great information revolution.

Mail order belt bombs

Manufactured by Islamic Sunni Yemeni belt bomb people.  They didn't give the shipping charge.

So, I can say, without slamming Muhammed, that Muhammed likes to manufacture and ship belt bombs around the world?  That is, randomly exploding people seem to be a religious ritual coming from the geographical roots of Muhammed and his religion in Arabia, named after the Arabian people who adopted that religion, and still preach belt bombing.  Where am I wrong?.  

Thursday, October 28, 2010

Why I am not worried about the ecnomy

I just did a return on investment calculation for the payoff of the Queensboro dedicated BRT line. I use a partial sum of gas saved plus time saved, then add a multiplier for these traffic gains.I have looked at four of the  variety of these lines across the USA. It is a revolution and is paying off as we speak:

The USA has about 200 high priority corridors like the Queensboro, each solution should generate $200 million in value/year. Another 500 should generate $150 million, and the much larger group generates $80 million. This is my guesstimate, resulting from my job as human search engine.

So, just applying lane control and dedication to specific chokes point, and dealing with commuters only, we end up with 2-3% gain in GDP above baseline. But as you add cargo, fill in the high speed long haul and get traffic control down to the last mile, then one can predict a 10% boost to the recessed baseline GDP over the next ten years.  These are simply unplanned endogenous gains, pure gold dug from sand and a little concrete.

Remember the price to install these things, $20 -$60 million is a likely two sigma range, so their pay-off is in three to five months.  That pay-off ratio is gold to the venture community.  It is a virtuous cycle when the technology lets us boost speed up to the wheel technology, basically anywhere.  So each boost in the variety and capability of the wheeled transports gets us that multiplier all over again.

Those links to the right on this page, the transportation links, all have similar stories.

The law and information shock

The law library is on line, the judge on line, the law clerk on line.  The only thing not on ;line it the traditional court house.    Courts, classroom, real estate sales; all light weight goods, all taken over by the webosphere.

Wednesday, October 27, 2010

How we can use Robocar technology today

Creating shared lanes from our highways, shared by BRT and qualified lane guided cars. But these lanes are very special corridors, and for a high price, you can just drive your car onto this corridor and read the news or drink coffee.  The traffic system guides your car along, shared by BRT and other qualified transports.   Near your destination, the car beeps you and you manually drive onto city streets.  BRT runs this way today, make the mode standard and create a lane designation.  If an unqualified car cross the lane divider, it is detected by traffic central and your car alerts you, right away, to take the wheel.   Normally the lane is used for synchronizing commuter car traffic.  These types of lanes have that virtuous cycle, entirely created out of sand and puzzle solving skills.  But they generate big gains in transportation efficiency and take advantage of that unique American advantage, the network of asphalt..

Robocar skeptics omit a certain force, the addition of low cost digital  infrastructure along the highway multiplies the limited capability of today's robocars. Associated technology, roadside am satellite wireless, roadside cameras, central traffic maps, reserved spacing, and most of all, the idea that traffic central is responsible for unqualified cars entering the system.

Queuing and road pricing in traffic

Queuing theory is often based on the poisson model.  Under the cover of the theory is the idea of random arrival of customers at a fixed service time queue, people arriving at the bank, for example, how likely is it that I will have three people in front of me.

In city traffic one gross model of the queue is to model the traffic cloud as a grid with an typical service time for random arrival of cargo and passengers to use the grid.  This is sort of a novel approach, but points out some thing regarding traffic grids.  If the amount of commuters piled up is a Poisson, then there is a significant liklihood of long waits, long wait that make planning ad hoc movement at risk.  In other words, when something goes a little out of whack in the firm, then on the firm must risk an out of band movement of cargo, then it cannot really guarantee queue waits.  Long transaction time across town have a differentially bad effect on businesses who rely on ad hoc transactions, it differentially favors economies of scale.

Adding capacity never works, the probability distribution always equilbriates to poison.  What works is synchronizing traffic, dynamically.  The transaction times are always adjusted by dynamic road pricing, so the queue becomes a narrow bell curve.  That is how you get the big multiplier with traffic technology.  The ultimate goal is to price me from the edge of the city, HOT lanes, light priorities, reserved parking space; all bundled into a virtual path.

The key here is low transaction times and a bit of futures pricing, getting users to buy space 10 or 15 minutes a head of time, again using technology and traffic sourcing applications.

Debasement and oil prices

Oil prices are my gold standard.  It looks to me that we may have equilibriated to a new price range, $80-$85.  Oil imports down to 2000 levels.  If we can do that and still have 1% real growth, then good enough so far.

Tuesday, October 26, 2010

Smaller portions, more often says Ben

The WJS reports on a Ben discourse. Ben says to QE2 in smaller doses, more often. Another good idea from the bankers.

Ben is rebuilding the short end, the higher frequency end. Rebuild by trading at the edge where the curve meets the noise, about the one year mark. The stimulus here is to get traders to think in six month gains.

Assume we want NGDP to grow 3% next year. Ben anounces to thw world that he intends to lose 3% of GDP dollars in a game of betting on paper, over the next year. So far so good. What will he trade? Trade long term treasuries.

So, traders now understand that Ben intends to lose $300 billion next year trading long term. What is the game plan?.

Ben sets the rules, he will trade something like a $100 billion every month or so in volume, either buying or selling.

Now we have Ben and the Japanese Finance Ministry Japanese Finance Ministrydoing the drunards walk

I love this game, can we sell it?  Ben intends to sell the long bond on a downward drunkards walk, with month to month variation in buying.

If it works, it will be a liquidity pump, the traders organizing a production line to distribute planned growth in NGDP.  The central banker is going to buy high an sell low to lose money.  That is, extend the peaks and lower the troughs in the short term government bond cycle. Now the central banker can only make short term trades that do not lose too much all at once,  otherwise they piss away too much NGDP at once and destablize the economy. cause the structure to invert when short term rates suddenly jump.

Robotic NASCAR

Yglesias wants us to fix the NASCAR industry. Let the robots race the cars, get rid of the driver. Speeds go up, awesome precision takes over, and viewers have handy internet input about what the cars are doing, and can follow along with a simulator. Interactive, high speed NASCAR; would likely be very popular.

NASCAR is suffering the weboschlerosis, they are not interactive, they need to get the sport on the web, make it a sport for computer geeks. NASCAR officials and car owners could define the rule set by prior agreements, and all the security locks in place would guarantee a pure car vs car.

Monday, October 25, 2010

Betting on positive inflation and negative growth

Tyler points us to this post.
Inflation-protected [five year]securities sold at negative yields for the first time ever on Monday as traders anticipate that the Federal Reserve will start a new round of asset purchases.

I don't quite get it, people are betting that nothing happens for five years except the Fed magically increases everyone's cash balances. I doubt it, better off to e mail me and I can find some great venture opportunities among the companies in the transportation revolution.

Japan pledges a drunkard's walk in currency intervention

Currency-market intervention is most effective when it’s a “surprise,” a senior Japanese Finance Ministry official said, sending a warning to traders that Japan is prepared to act again to stem the yen’s advance.

Good idea, but it only works if you trade your currency up once in a while.

NYC dedicated lanes: Case Study.

The Lincoln Tunnel which Streetsblog reports on.
the Lincoln Tunnel’s Exclusive Bus Lane is a smash success. In the 3.75 hours it’s open each morning, it carries 62,000 passengers into Midtown, saving each of them 15-20 minutes over drivers in other lanes.

That comes to about $125 million a year counting just time saved at $20/hr wages. Add in shift in energy use, a bit of multiplier, the dedicated lanes likely yield $250 million in value/per year.

A solution for the Queensboro Bridge
Start with a single reversible, dedicated bus line across the bridge meridian. Shoot buses through the bridge at 60 MPH average speed, 80 MPH top speed. Even using reversible lanes, the buses will shave 15 minutes a day for 20,000 passengers. The actual lane cost is low, and with narrow lane guidance, it is likely cars may not suffer lane reduction. Though likely to yield another $100 million/year in value to NYC, the actual lane cost is trivial, likely close to $8 million (not including bus stops or bus queue lanes)

Let Boston residents sell their parking space

Yglesias wants us to look at this parking problem in Boston.   Too few parking spaces for new high density apartments.  If someone owns curb space then sell it, using technology.   Existing low density residents claim apartment dwellers will take up their parking space.  The key is 'their'.  If local residents object, then work a deal to sell their space, take an income  recovering their loss over time.  Look at SF smart meters, for example.  Get the city council to redirect parking income back to local residents who lose space.

Yes, there is always a market for small units of value, if the transaction costs are brought down.

Back to the Fed

The Fed has traction, always does by definition of a yield curve.  Take a look at the Dynamic yield curve, again.
  Look at the curve movement over the past year and there is unused elasticity at the short end.  The problem is that Fed trading does not follow the velocity frontier, other bloggers noting this as well.  This points us back to fixed frequency sampling inherent in minimum variance estimations.

There is always a short end if there is a recognized yield curve.  The short end, in hydraulic macro, is the band limit of production over the monetary field, the point where the curve hits the noise level.  The Feds problem is quantum, they  have one huge customer, the US Congress, which wants the Fed to fund long term for them.

Sunday, October 24, 2010

I quote Yglesias

"one of those classic instances of “provocative” journalism that manages to meld the banal and the false in a superficially appealing way"

From a recent post of his. OK, deal, I will watch out for that sort of journalism.

The Perfect Tea Party

My Tea Paty platform is very simple, run federal government from a strong House of Representatives. I want a House that refocuses federal government to deals made on the district level, that is district earmarks!

My theory, based on the precision of aggregate operations, tells me that within the Constitution, the Congressional District is the optimum Quant of human activity for federal government operations.  The House, being the most accurate, should be the most powerful..

My Tea Party Platform:

Storm the House!

Find the Romer/Krugman contradiction game is on!

Krugman poiints out that total government spending has been within trend.  I point out that central government spending has skyrocketed relative to state spending.

Romer really wants to get more money into  state paychecks for teachers, using central government debt.  I point out that one of the inflexibility of local government spending is that 15% of total tax revenue first goes to central government debt service.   I point out that we have still not covered the adjustment costs for NCLB.

Both stake their claim on the Keynesian right of inflation by government spending, but what they really mean is central government increasing dominance of the government yield curve.  That is contractionary, we have a couple of other names, multiplier less than one, crowding out.  Remember, these two also favored adding a new central government health care entitlement, in a land where we have too many already.  Which entitlement gets thrown under the school bus?

But the bottom fundamental theoretical error is simply that we do not have a proper combinations of deals and contracts at the central level to get the fine tuning they want.

Saturday, October 23, 2010

HOV lanes are Hot Property

Part of my virtual job, I use the web to search out the relative build out of HOV,HOT, and BRT; to see what's hot in lane space.

My results are informal, but adding HOT to HOV is very big news right now. The cost of the relative addition is low, simply the cost of the transponder.  The results are much better efficiency with variable pricing. This is why this is a major industrial revolution, the huge multiplier of technology applied to transportation.

But that is not all, what does BRT have? Lane guidance.  Can BRT vehicles use lane guidance in HOT lanes? You bet, works great.

But that is not all! An additional offer.  Add a cheap display on the transponders so each driver can see the digital view of the HOT lane.  Great safety addition for mere pennies, pay off in about two days.

But wait! Who is done here?  Having so far spent pennies and generated multipliers way above one, we can do more.  Let the BRT pay for right of way on the HOT lane, and speed them up to 80 MPH, on todays HOT lane, generating revenue, great increases in energy efficiency, and cost?  You have to give instructions to motorists when they get their transponder, and the transponder has to give warning of BRT on the move.

Using existing asphalt, we add $30 to the car, then another $4, then another $2; pretty soon  we have added almost $50 in fixed  cost to commuting.  Yet yield successive gains in efficiency of 10%,15%,30%; compounding that we get application layering in the software.  You will find that existing bus lines get their routes with half the traffic delay, twice the speed; independent effects.

The ability of technology to offer traffic space at velocity ranges  yields the huge gains.  The limit to these gains is the limit of the pneumatic tire and the cost of managing human drivers in protected lanes (high speed lanes have to be curbed) .

But, back to the main point, right on schedule traffic planners are finding '$20 bills'  in those underutilized HOV lanes.   Technology vendors!!! Start talking about traffic sourcing for transponder users, applications and simple displays.  The HOT lane concept breed consumer demand for traffic applications, for example, roadside meetings for route based convoys.  Traffic planners, look for cash in those traffic lights, green lights have more value than red, and should go for higher prices; get your traffic lights and parking meters on the transponder nets.

Let's talk infrastructure

Taking our tractors out on the hgihways and adding, repaving, installing etc. I track those numbers, and my baseline is the I-15 corridor, per mile (lane installation only) for high speed BRT at $3 million/mile. HOV to HOT lane conversion should be no more than $1/2 million/mile. If we define high speed HOT lanes, with limits up to 85 MPH, transponder tracking for the consumer, and sufficient passing right of way; then lane costs should be around $1-2 million/mile. A high speed HOT lane from Victorsville to Vegas costs something like $100-$150 million, but using that we can move a 200 passenger BRT at speeds averaging 80 MPH. If traffic control can guarantee that speed, then roads fees of $1,000 per bus are justified.

What about super HOT lanes?
Let's define a lane that requires collision warning and lane drift warning. These two applications can be had with more expensive dashboard transponders. But, with these things and car inspections; then we have super HOT lanes with velocity lanes for 85-90 MPH, fixed speed! In other words, Nevada governor candidate Gino's plan for pay for speed works, with today's HOT lanes and today's digital assist. That means super HOT lanes can support BRT systems at that speed.

Friday, October 22, 2010

The real reason England has become Austerian

They are rebalancing an energy deficit

HT to the Oil Drum for the chart where Euan Mearns follows the UK energy situation

I want an economics simulation game

Like this:

A simulation game based upon standard and custom models of the household and firm, seriously, like a Sim City for economics play. It would actually be quite fun, fit the model with parameters, then try raising taxes and building schools at the aggregate level. But the simulation itself is micro, each agent running through its process. Add macro shocks, and see how the evolving agents adapt.

Statistically, we can do with an N of 1 to 20 thousand, get smoothness up to the accuracy of the models. Who has this game?

Australian Bus Rapid Transit, fast and getting faster

Current cruising speed of 50 MPH (80 kph), but that is going to 62 MPH (100 kph) on a system using lane gidance. These speeds are small and technology will easily push things to 100 MPH and higher with Australia full of straight aways.

A report of very successful BRT in Australia.

Australia is a prime market for very high speed lane guided highways. They are also great experimenters with transportation.

The biggest merger of all time!

Congress and the Federal Reserve:
Ezra adds much needed support

The answer is obvious: "explicit (though temporary) cooperation between the monetary and fiscal authorities." In practice, that would mean Bernanke gets John Boehner, Nancy Pelosi, Harry Reid and Mitch McConnell in a room and says the politics and specifics of this are their job, but the economy needs more fiscal stimulus if it’s going to recover, and the Federal Reserve stands ready to make that not only possible but also virtually costless. Inasmuch as Republicans aren’t big fans of further government spending right now, the best option could be the exact one that Bernanke recommended to Japan: a Fed-financed tax cut. Perhaps a payroll-tax holiday for the next year or two.

Karl Smith and Klein plotting a sneak helicopter attack in the currency wars.

Ford and the future auto mobile

Their engineers got an award for knowing about Ford and the future. Read Ford's pathway.

The auto is just a medum part of it all, actually, it is mostly about embedding silicon into the asphalt and road signs. The new model is traffic space, technology gets you better utilization of it.


See Kling.

The way to add value to housing is decrease cost and increase efficiency of commutes and cargo. The suburban housing booms rely on regional industrial growth outpacing commute and highway costs. Going back to the I-15 corridor project, if we lower the commute delays and increase commute velocity from Las Vegas through the LA basin, then transportation is no longer a restriction on housing utility.

Sand solves the housing problem.

Thursday, October 21, 2010

Delivery drones are the key to economic development

William Easterly wants to know, so I take a swag at the problem.
In Africa we need small flying robots that can deliver 200 kg of cargo to a remote airfield. Simple as that.

Africa is a special case with difficult or impossible roads. So the greatest hindrance to development is not having some critical piece of equipment and some process stops cold. When that happens, a model airplane that can make a special delivery in a day or two is a lifesaver, extraordinarily cheap, and free of corruption.

A little forensic accounting on Barney Frank

Jason Delisle discusses Barney's accounting gimmick that shows the Fannies to be making a profit. The proof is in the pudding, try and sell some of that stuff and get some pricing.

Is Ben gearing for war?

Bullard suggested that the FOMC announce Treasury purchases in “small increments,” similar to the way the Fed typically raises or lowers the short-term federal-funds rate by a quarter percentage point, or 25 basis points.

The St. Louis Fed chief envisions Fed purchases of $100 billion to start, with further Treasurys buys contingent on the evaluation of economy at future FOMC meetings. The FOMC would have the flexibility to pause or increase the Fed’s Treasurys purchases depending on economic conditions, Bullard said.

Last Friday, Federal Reserve Chairman Ben Bernanke said the Fed is ready to provide additional support, “contingent on incoming information about the economic outlook and financial conditions.”
WJS reporting. Sounds like military strategy to me.

Information goods extend the future

The length between suppliers and demanders grows in distance under information shocks. Transaction times increase when the demander is willing to wait longer for a far off supplier. The aggregate yield curve pushes toward the long end, but potential growth remains fixed. The effect is to temporarily push part of the curve into negative territory, and we see things like Blockbuster being unable to adapt.

Under hydraulic macro, with fixed power spectrum, a sudden shift in the term structure must result in some bankruptcies.

Mayor Antonio Villaraigosa is thinking grand about transportation

Los Angeles Pushing To Become Nation's Mass Transit Leader from Huffington's Daisy Nguyen.

His basic plan, like many other government officials, is to borrow a lot now while rates are low. Unfortunately, the bond market will charge a premium for the grandiose as they have bad experience with it. The mayor would be better off backing his debt with transit and congestion fees, rather than the sales tax.

Nguyen touches on this theme twice in the article:

n the first half of the 20th century the Los Angeles region boasted an extensive system of streetcars and high-speed electric railways including the famed Red Cars. After World War II, Southern California began abandoning those systems in favor of personal automobiles and freeways, leaving mass transit to buses.

This is exactly the problem, much of the light rail will be uprooted and moved or removed. Neighborhoods change faster than the city can reroute light rail. I expect the Santa Clara light to be removed and replace with flexible BRT.

So, break the projects into smaller units and borrow money based on ridership income for the particular leg. The highest risk projects will pay a higher premium for money, and thus can be rejected. Otherwise the Mayor will bankrupt the city as bond investors see more and more risk with the grandiose.

Let's not forget that the LA governments are practically bankrupt as it is.

Austerian triumph in Europe

A big Webosphere debate about cutting government spending in Europe. Start with Brad and work back from there.

Governments restructure with frequency, sorry, but they do. It is not like Brad hasn't lived through a government restructure cycle, what is his theory about why we did it under his watch with Bill Clinton?

Angry Bear find's research supporting intelligent transportation

Ken Houghton points us to a study about congestion and low birth weight, assumed due to high co2 concentrations.

Wednesday, October 20, 2010

The curve is a bit steeper

So, again in QM Theory, we strip away the entropy encoding and note the peak of the spectrum is shifting toward the long term. (Remove entropy encoding and we get hydraulic math) The economy, as seen via the bankers curve, is planning for a longer business cycle.
Thus, bankers are hearing stories about planning to hold inventory longer and living with reduced sales rates

We want the spectral peak to move back to the shorter or medium term, and to spread out a little bit, flatten become more symmetrical. That is we want it to act as if distribution networks could mimic reversible flows, there is always a product marginally different from another to meet most needs.

Tuesday, October 19, 2010

The case of the Chicago Parking meters

Abu Dhabi, or its government, with 900,000 citizens and 9% of the worlds oil reserves has a 75 year lease on Chicago City parking meter income. They paid a billion or so for the lease.

Anyway, Abu Dhabi is investing in gasoline resources, the tanks of it stored underground around down towns in America. Whenever they optimally ration parking, gasoline is recovered as cars no longer roam the streets. Abu Dhabi would be a very likely investor in very high speed traffic controlled highways.

I guess the other thing is that transit managers have io understand that technology is going to add great value to parking space, traffic light priority, and lane space. If a toll company owns right of way and think it is a dog performer, read this blog and look again. When the Chicago parking meters were sold, did the Chicago city council know about technology and crowd sourcing; selling reserved space, particular spaces, statistical space and the variety of sales modes enabled by technology.

Obamacare and the Supremes

The last post brings up this. What are the legalities of Obamacare?
The Supremes will eventually have to decide the case of a citizen that meets all the health insurance requirements but does not use the government certified plan.

Consider professional sports teams that provide direct, dollar for dollar, medical expenses for the players, meeting all government requirements. They will argue they need to be excluded from Obamacare because their business is heavily invested inn sports medicine already. Hence, the unnecessary burden of dealing with Obamacare. Due Process expansion of qualified insurance plans will be the legal order of the day.

School Choice and the Supremes

My legal expertise needs to be applied in Garriot v. Winn.
Arizona grants a dollar for dollar tax break to citizens who donate to school scholarships. The case is arriving at the Supremes via the avenue of religious freedom.

Before this discussion develops, let me point something out right away, the three way trade. Citizens pay for schooling, funded schools provide a service required by government, government then pays citizen the amount spent. Government is the default provider of education products, and citizens are required by law to buy some quota of educational products from acceptable sources, government or private.
Not quite libertarian, but I see no Due Process violation, no bias.

So the plaintiff here has a high burden of proof, since there is no obvious Due Process wrong, nor claim of any, and no dispute with the legal requirement to fund education. How do they get religious freedom? If some religious schools are improperly qualified, then exclude them. But we cannot have a blanket exclusion of educational products produced by religious sects.

Case Dismissed.

Play more games with government spending?

Let's look at the whole timeline. Between Reagan and today we have had nothing but Communist jackasses, well except for the Clinton/Gingrich dynamic duo. And yes, Obama and Pelosi did goose congressional spending but luckily we were able to get state reductions to offset increased damage.

The yield curve and planned NDGP

The first should predict the second snce the banker yield curve represents the expected gain in inventory growth over the period of the loan.  So when we are steep, say from 2-10, we know people are planning growth in ten year inventory, big stuff like plant and equipment with long depreciation cycles.

Also, related, is hydraulic mode i which we treat the yield curve as a spectrum, but in QM term, compactly represented to a fixed SNR.  But if we strip away the entropy encoding and look at the equilibrium curve underneath, we find it is peaked about the ten year frequency (1/10 cycles per year)  In the production spectrum the bell shape at equilibrium centers about  1/10 on the positive frequency axis (transaction rate).

Putting these two together we can do a bit of forensic sleuthing and deduce that we are telling the banks about ten year projects that solve our economic problems.  What? Likely mergers and acquisitions that shorten the supply  chain and gain from economies of scale.

What do bankers think  these projects generate in terms of GDP growth?  Well a little bit of frequency transform into the time domain gives us a planned peak in the next business cycle at ten years.

Notice that the curve gets flatter at the end of business cycles?  As the cycle gets near the peak, marginal returns drop, especially at the consumer end.  As the cycle ages it is increasingly difficult to find product opportunities, especially true if the  cycle was well planned.  The curve get flatter because bankers want greater inventory growth to cover the extra search costs.  Converting a flat curve back to the time domain, the flat curve predicts an impossible spike in GDP growth, so we deflate and retool.

In this growth model since say the 1970s, the sequence has been use existing means of production until marginal costs are too high; then switch over to the surplus new technology and readjust the production spectrum.  During each cycle surplus technology builds up for the next phase, we will almost never have a shortage of technology.

Monday, October 18, 2010

French citizens debate the budget

Story at Eleven.

Economics eventually boils down to queuing theory

Most of what the macros are doing is looking for short cuts in analyzing queuing problems that show up as inventory mismatches. We individuals as economic agents basically solve queuing problems throughout the day. In July, 2008, tankers queued up for oil faster than OPEC could produce it, later shippers queued up for goods faster than retailers could sell it.

In QM theory we would look for a time and place where the set of finite, and large potential contracts OPEC dealt with had no solution. That is, no combination of market outcomes would result in a random walk, on that particular week, some region was going to be out of oil. So that pair of variables, transaction rate and transaction size, had to be remade at the OPEC level. The first part of the remake is a contraction of the network and equilibrium about the sub graph. The distribution network had to be simplified. With a reduced network rank, each sub-dividing node along the way would hold more inventory The overall shape of the network retains its shape, but it has to operate in the deflated state for some time, inventories build up along the nodes and the probability of someone being noticeably short goes below normal.

There is no exact solution, quantum noise builds up in deflated state and depletes in the inflated; but both states are balanced. If the economy attempted an equilibrium with an unbalanced network, the bubble would be noticeable and Stein's Law activated.

The queuing model tells us that the only aggregate stimulus is speed, lower the transaction time for everyone, which is why we always invent faster transportation. A depression is one in which we remake the cargo transportation network, streets, roads and rails. In these depressions we always seek to satisfy the demand for point to point constant velocity travel, it is the demand for new transportation, generally more speed, that changes suddenly, usually a result of information shock, but not always. A good horse epidemic in 1870 could paralyze an economy, but even in the horse epidemic one looks underneath and notices the horses queued up way to long in crowded port cities. And again, the horse queues loo long in our ports because oversea cable was activated.

It would seem to me that economists would be the first to recognize that reset and remake of transportation technology would cause the greatest economic dips. I would speculate that transportation is at the heart of language development, it came about as a method to speed things up.

Micro assumptions of QM
The theory assumes the firm or household manages inventories inside the firm first, worries about market prices second. For example, the auto driver buying gas. I suspect the first reaction he has to shortages is the line at the gas station, then he notices price. The driver fixes the queuing problem by buying at off peak hours, but that entails a change in inventory cycle for the gas tank. He ends up driving a bit longer per tank, lengthens his whole household inventory cycle and occupies a larger portion of the energy yield curve. As long as the line at the pump is not visibly large, the driver will make small linear changes to household inventory and accommodate a range of prices.

Both the gains of scale economies and the costs of disruptive change occur because all drivers have nearly the same definition of an observably long line at the pump, we are all biologically tuned to the same level of discomfort, there is a biologically constant probability of error we like to live with.

This is what I am talking about!

Sunday, October 17, 2010

Lane design for BRT

These lanes from Eugene Oregon.  Put them together and utilize the lawn space between, take some of the recovered space and make a curb to keep pedestrians out, add lane guidance and speed things up.  These are not Podcars that roam around the park, these are high speed brutes.

Actually it looks slightly like more spending

But I had to take off my glasses for a closer look.  The private sector is about level but government kept on growing for three years.

Saturday, October 16, 2010

UNLV jobs report on DesertXpress

The professors project a $5.87 billion payroll budget during construction.

Their study states the payroll result if all parties invested in DesertXpress tomorrow, and finished up in a few years; that is absent any side effects from equilibrium.

Let us study where the report can go wrong:
1) DesertXpress will be delayed until the California High Speed Rail breaks ground
2) DesertXpress will be delayed as California High Speed Rail takes up existing resources.
3) Intelligent, faster BRT in HOT lanes generates better results, sooner and enthusiasm for rail dissipates.
4) The state of Nevada is asked to pony up $2 billion, and drops out

All of these are likely to happen.

When the dust settle, I do not expect DesertXpress, HSR, nor much light rail. I expect we will repeat our last two tries at this, put in rails; then take them out. Rail gets in the way in the modern world.

The relative amount of federal spending.

We all want  the appropriate size of Congressional spending.  We have to go back all the way to the era of Big Government Ronald Reagan Communism to find anything like ratio of federal spending we have today.

How many of us really want to go back to Big Government Conservatism?

My existential patent rule

Patents have become a protectionist racket. I always had a better rule.

To test if an idea is patentable, build a theoretical model of the invention out of cardboard. If that cardboard implementation exists, and is unique enough; then patent granted.

The rule came to me one time when hearing about the possibility of a patent on computer file systems, and its presentation of tabbed files on the screen. I thought it odd because there has existed cardboard box and cardboard file folders for thousands of years, prior art anyone?

Bob Metcalfe on prior art:
A big problem was that for 20 years the Patent Office did not issue software patents. It was against the rules. So, for example, when I patented Ethernet I spent a lot of time with Xerox attorneys explaining how you would build Ethernet using hardware, even though we actually built it using a lot of software. But since software was not patentable, we had to express it as a hardware embodiment. And then somewhere along the line, for some reason I don't know, the Patent Office started allowing software patents. That created a big problem, because there was this big gap in the prior art. A lot of patents got issued that shouldn't have been issued, because there is prior art out there that just hasn't been discovered.

Read more:

Bob's point is that the the rule change suddenly made common industry practice patentable. So, the government changes the rules and, for example, I patent the software controlled windshield cleaner, generically. Well I have just invalidated a generation of car wash equipment development, including a generation of digital systems deployed throughout car wash equipment. Or simple thing like organizing data on the computer screen were commonly accepted knowledge for way back with old style character terminal screens. But suddenly, this common knowledge gets wrapped in generic patents because of the software rule change.

If you apply the software implementation rule, then all the personal computer property reverts back to Xerox Research Park, Palo Alto. Once you have the mouse and screen icons, you have the whole shebang. But even some of that was suspect because character terminals always had the arrow keys and could move a cursor around. What about the mouse? Probably, but look further back and we have the joy stick and track ball on some early video games. But the joy stick just came out of remote control as a consumer item.

This is typical

At least 120 municipalities spent a combined $700 million in housing funds from 2000 to 2008 without constructing a single new unit, a Times analysis of state data shows. Nor did most of them add to the housing stock by rehabilitating existing units.
The link.

We are not brainwashed against government, rather we have worked in government and seen that about half the procurement money generate vu grafs and nothing more. If it is 'make work' then call it 'make work' and be efficient at it.
HT Market Urbanist

Let me ask, if this is typical, then what is the probability that California High Speed Rail ever puts shovel to ground?

Friday, October 15, 2010

Unions destroy themselves

The Transportationist found this little gem:
TriMet [Oregon transit agency] recently cut service on all light-rail lines and more than 50 bus routes. Agency managers have consistently blamed this on a $27 million revenue shortfall caused by the recession. But the recent release of TriMet's audited financial statements casts a very different light. According to the auditors, TriMet's total operating and non-operating revenues -- including money from passenger fares, payroll and self-employed transit taxes, and operating grants -- increased by 6.5 percent during fiscal year 2010, which ended June 30.
If revenue is up but service levels are down, where did all the money go? The short answer is fringe benefits for employees. On an actuarial basis, TriMet's cost of fringe benefits equaled 152 percent of wages for the just-ended fiscal year. That's the worst ratio among the 20 largest transit districts in the country. Some districts, such as Denver and Miami-Dade County, have fringe benefit costs that are less than 40 percent of payroll. No other district besides TriMet pays more for fringe benefits than wages.

We automate when employee costs drive us to automate and modern transportation is easy to automate.
Comparing Utah and Oregon on their adaptation to the pension crisis, we have to go with Utah as the next Silicon Valley.

Swimming at 7,000 meters under the sea

Believe it or not!

Digital Cash

Cash money that works anywhere, but is based on digital means.
My digital cash invention looks like a battery operated credit card, that displays the amount of cash. That amount of cash contained digitally therein can only be altered by tapping the card with another digital cash card that they may exchange digital cash sums. The cards have up and down patches that collect money exchange messages from the initiating card. so the user taps the patches in a sequence that generates the proper transfer.

The cards have a secret code, known only to each card and inserted into the cards with a blind process at the mint. Hence, digital cash can exchange securely only with other digital cash; thus, we hope counterfeit proof. The money industry manufacturers digital cash with zero balance. Then using debt instruments, banks can charge them up.

Watching stocks

Iteris comes up a lot in transportation. My 30 second look says they are a median company to watch in the sector.

Great BRT simulation about Oakland

Now it seems obvious to me that we can duplicate this idea at higher speeds along the I-15 desert corridor, no? Then Vegas and LA and points between become one community, united by behemoth buses that cruise at 120 MPH and carry 200 passengers.
How do the forces line up?
Between the intelligent asphalt plan and the steel rail plan? In the case of I-15, the DesertXpress rail folks have Reid, a senator running for his life, a consultant, and a CEO of an imaginary railroad.
The intelligent highway plan has behind it: Google, FedEx, Greyhound, the private bus industry, UPS, toll highway companies, car drivers, local businesses along the route, the venture capital industry, existing and expanding BRT capacity, the probability of generating income for local districts, smooth integration between HOT lanes, BRT lanes and protected high speed lanes.
No contest, passenger rail should surrender immediately.

Asymmetry in action

Notice how the economy will test the highs of oil prices with a gentle slope, then when it reaches the price limits it takes a leap downward.  That is asymmetry, we do not plan negative growth.  Instead we reset the production and retry.  The reason is simple, if cuurrent production needs adjustment, we cannot disassemble the product and force it backwards for a retry. This irreversibility is entropy msximizing.

Good comments on the DesertXpress proposal

Somebody thinks a steel rail system from Victorville to Vegas makes more sense then the intelligent super speedway on asphalt. Like the Oakland airport connector, this proposal will not last and likely will waste billions from the investors.  Curbed LA has the discussion on the topic.

The pay off formula disparages rail.  Each mile of HOT lane we install allows a BRT to cut its travel time in half along the route. That comes to better efficiency at 1/4 the cost of rail. The intelligent superhighway will win this battle and some Victorville politicians will be eating crow.

Bond investors should stay away from passenger rail in all forms, but long haul cargo rail still rules.

Thursday, October 14, 2010

Transportation news

Insurance companies will like this:

Michigan University study shows Takata’s lane-departure warning system aids truck safety

The University of Michigan Transportation Research Institute (UMTRI) and Takata Corporation have announced the results of a year-long field test of an integrated system of crash-warning technologies that is designed to enhance the safety of the commercial trucking industry. Takata’s SafeTraK Lane Departure warning system was used exclusively throughout testing. The results from the integrated vehicle-based safety system (IVBSS) study showed that 38% of drivers reported that the integrated warning systems prevented them from potentially having a crash, and 83% of drivers would prefer a truck equipped with the integrated warning systems and would recommend their carrier purchase the system.

Oil imports vs Ceridian

The two are tracking closely, the Ceridian measures final demand for diesel at the pump. When supply and demand track this closely then the supply chain is operated within tight bounds.  The affect makes the economy bandwidth constrained, little flexibility in setting prices.

I love cable pulled vehicles

They make sense, they may even make sense for the Oakland Airport connector. I never disparaged cable. Remember, cable keeps the propulsion stationary, less weight to move around.

My complaint is that the cable should be in the ground, or above the asphalt; and we should make it part of the general transit artery. Any other problems requiring speed, priority, integration or sales of lane space are all handled by technology.

It is the same complaint I had with the Ultra PodCars, if we build protected lanes, then define the software/hardware architecture that lets other Autobots share these lanes. Autobots would likely be very precise in grabbing the cable for a free ride.

Let me summarize:
If we think the Airport corridor needs an overhead lane, then evaluate that separately from the issue of the propulsion. But we cannot take overhead space from the corridor and restrict it to underutilized vehicles; thus distorting the corridor. The test is open access traffic pricing, regardless of what they build and what technology restrictions they impose.

In the case of Heathrow, if we like lightweight autobots, then we like light weight cargo bots, light weight hybrids or electrics, light weight self driving rental cars. A case can be made that airports have greater utility with light weights. Airports are gated communities, but if light weights make sense, then make the causeways into general arterial corridors; otherwise think twice.

What is the minimum technology we need for any car to get a free cable ride?

Well the cable needs intelligent hitches, which I now invent. The hitch rides along the cable, just under the asphalt layer. Via wireless communications attracts a customer, just above it. Using control by wire the car aligns its speed, and the hitch grabs a hook near the rear differential, and away they go.

Airports are an interesting case:

Planes are volume restricted, more than weight restricted. So, what if we go with volume restricted vehicles on causeways? Then we have the possibility of boarding the passengers and baggage miles away, both riding in multi-car diesel electric trams to the actual plane boarding. If airlines could agree on the quantum volume of cargo or passenger, then the causeways could be designed about that standard. We would minimize cargo handling at the runways, we maximize the use of technology in sorting and tracking. But, in a sense, airlines have already agreed, they have those trains of baggage carriers. Build a light weight causeway standard around some small multiple of that carrier size, make it autonomous drive only.


Reid, LaHood and Nevadans:

DesertXpress is a $4 billion, 200-mile traditional high-speed rail proposal that would link Las Vegas with Victorville, Calif. Backers have said they would work quickly to build a 50-mile line between Victorville and Palmdale, Calif., to tie into California’s planned high-speed rail network.
So the first link in our national rail system will enable citizens of Palmdale to vacation in Victorville, 50 miles away? We know this is mostly hype because of their 'out'. They will await the California plan!

Nevada listen up! The first leg of my I-15 corridor plan is to invent a virtual lane for high volume BRT straight to the Casino doors, even before we break ground with a shovel; buses dropping 200 passengers at a time for a week end in Vegas.

From there we start building the 120 MPH asphalt corridor down the I-15 meridian, along with HOT lanes. We do this at 1/4 of the bullshit numbers coming from DesertXpress. We build first from Victorville to Vegas. Faster, cheaper, fewer changeovers.

Then we tie into the LA BRT network, and push them to boost speeds. The the plan will deliver 200 passengers from any neighborhood in LA to casino doors in 2.5 hours. The plan includes high speed cargo. Vegas will boom.

Project financing is self sustaining, with transit districts along the way retaining a residual income from fees. This blog along with others, many listed in links here, will force a standard software technology onto the vendors, with smooth traffic control along the route. Bond yields will be lower with projected revenue, and opportunities for transit upgrades by local communities increase. Victorville, Vegas, Salt lake City becoming major switching points in a national super speed highway.

Wednesday, October 13, 2010

Modeling in quantum economics

We start with out premise that there are few solutions to production, and the ones found by the economy are very locally stable.  We ca hld a strcuture for w aiel, then we srop a rank, literally using a sparer distribution network.  Er operate in the N-1 state, the deflated state in which inventories accumulate.

The dimensionality of production is small, so the QM model would expect the economy to have five pole/zero combinations typically, using the hydraulic bandwith model.  QM modelers would be trying to reconstruct the dimensionality of production in a particular sector by decomposing output into a generalized yield curve.  The quantum component comes in when we know values of state variables cannot exceed a trading range, like analytic stock traders do.  When a sector trade gets out of range, then the sector may be due for a deflation (or visa versa).

There is more to it, somewhere.


My other theory on the industrial revolution

It started in 1750 with the first census in France. At that point scientific study of aggregate human statistics became the norm.

Prior to that was the defeat of the plague in 1720, using newsprint to provide advanced warning and quarantine. Once the plague was defeated, the age of survival for children dropped from ten to seven, or so. At that point, parents invested earlier in children and that paid off is creating scientific minds.

I have lots of industrial revolution theories, however.


Orange Country Register reader gets it:

Jerry Brown signed the 1977 Dills Act (Sections 3512 through 3524 of the Government Code) into law in 1978 and granted collective-bargaining rights to state employees. Since that time, state worker salaries, pension and health care costs have skyrocketed. State workers now enjoy salaries and pension benefits that (conservatively) average 20 to 30 percent higher than private-sector workers, along with Cadillac health care plans.

Consumer sentiment and autonomous vehicles

A good sample is in this post and the comments.

Tuesday, October 12, 2010

BRT Success in Las Vegas

The Regional Transportation Commission (RTC) of Southern Nevada is spending $164.6 million of public money, some of it from the federal stimulus, to improve the way people move around Las Vegas. “This is our first truly commuter-type transit service,” says Tracy Bower, RTC’s director of media and government affairs, referring to the ACExpress C-Line, which connects Centennial Hills, a master-planned community in northwest Las Vegas, to the downtown area, and continues out to the University of Nevada, Las Vegas (UNLV). She emphasizes that a route to downtown that would typically take more than an hour can now be traveled in half the time.

The new ACE lines have already exceeded ridership expectations, officials say. So far, about 20,000 people per day ride the ACE Gold Line, and 12,000 people have ridden the ACExpress C Line. This far exceeds the 4,000 to 6,000 riders originally predicted by the RTC’s computer models.

If we can get these behemouths to travel down the meridian of I-15 at 120 MPH, then obviously they cruise up to the strip, using pre-existing BRT stations.  

I-15 virtual planning

I make progress as the virtual technical auditor for the I-15 improvement system. Let us review.

We have mostly open meridian space between Victoreville and Vegas. We co-join with HOT lanes made of the existing center lane. Because both vehicle sets have transponders, we can eliminate bypasses for the high speed BRT vehicles. We still have erector style lane construction if we want it.

So, I now have $5.5 million/(lane mile) construction including both lanes. But I see the 150 mile corridor generating $200 million in tolls per year, or $1 million per (mile*year) Low construction costs, reuse of existing facility, use technology multiplier, open use up to qualified vehicles. Likely %6 return over ten years, what's not to like?

Some keys:
* Let local DOT budgets share in a income residual so they are on our side for the duration. Local state departments can expedite the approval process.
* Educate the Nevada state legislature about increasing the efficiency of tourist flow.
* Keep Google intrigued.

'Be Less Terrible' the new Republican slogan

Boehner told the audience [of suckers] that Republicans will change their ways if they have a majority in Congress again.

We know Republicans are big spenders, its genetic.

Traffic communications when mixing HOT and BRT lanes

Traffic telecom is valuable, and private cars in HOT lanes have transponders, and thus can communicate with today's BRT vehicles. So, right from the start, we use that capability to coordinate between HOT lane vehicles and BRT lane vehicles at points of merging.

For example: Along the I-15 corridor, toward Vegas, the protected lane and the HOT lane would run parallel many times, and share space many times along the route, to minimize construction costs around bypasses. However, via integration and a standard architecture, we know that vehicles from either lane will communicate, and return indicator warning lights to the drivers; making merge points synchronous and safe.

So, when a company like Google steps into the fray in the transportation sector, then planners know right away that the issue of a standard architecture will dominate via economies of scale. Hence, we have a realistic chance of grabbing meridian space along I-15 in chunks, 10 - 15 miles a chunk, and laning that off for very high speed operations while a parallel HOT lane is always next door. The two lanes together creating a marketable virtual lane along the length.

Knowing that the two lanes work together, enable economies of scale in their construction, building the protected meridian lane while refurbishing another lane for HOT. Total infrastructure costs relative to road income drop, road bonds become safer. And there is a bonus. When a HOT and BRT lane merge, the right of way is a marketable item, in the new architecture.

See, the importance of the standard architecture in this revolution, open software.

Monday, October 11, 2010

More in Transportation

TomTom does a deal with AutoNav.
GPS in Cabs gets a recommendation.
The computer industry bubbles up to auto technology.
All of these great links from Transportation Communications.

And, advance traffic control under test by Mazda.

Helping Google make money with its Robocar technology?

Henry Blodget asks from Business Insider.
And MG Seigler, at Green Tech, has trouble finding the money flow.
The value of the technology is that it takes an empty meridian space on our freeways and turns it into a half million dollar/(mile*year) income. More efficiency human and cargo carriers, faster speeds, fewer change overs, flexible routing. Read my blog.

My first thought for Goggle would be to push for reseller rights on the meridian space of I-15, rights for semi autonomous vehicles with traffic control. Release the standard architecture for the super highway enable vehicles, buy up more and more meridian rights as they come available, and use technology to get gains in construction costs.

The company could literally become the Ma Bell of the transportation grid. Their way of doing open source business changes the transportation model. Any vehicle vendor who follows the software prescription can run their vehicle on the traffic controlled lanes, for a price. Google should take my proposal, outlined in this blog, and create a transparent market for investment bonds backed by specific meridians, identifiable using Google street view. This market, plus the open technology approach, makes for a very compelling argument in favor of Google getting easier access to these meridians.

Economists need to improve their stimulus story

The stimulus theory we debate in the blogosphere is a limited case, the case of central government responding to a general slowdown. Economists need to expand the general case to one of a large market player responding to a shock in its sector. Expanding the case set gives a larger N and more variations, especially historical technology shocks to transportation, print, and money industries.

My model tells me that the depression of the 1820s was likely caused by the rotary press in England, which suddenly required the need for a futures market that didn't exist, and put stress on transportation to maintain inventory. Government could do very little except adapt to a more efficient futures market and research faster transportation.

My model tells me the broadcast radio made our surface transportation out of date, overnight in many large cities. In America the citizens turned to central government to build 500,000 miles of asphalt roads.

My model also tells me that IBM adopted an open hardware architecture, and overnight, changed the computing world.

Stimulus theory and monopoly theory are connected, and more subtle then our debate.

Sunday, October 10, 2010

Selling virtual traffic space

Consider the case, common in LA, of groups of commuters driving the HOT lane to downtown parking. The transponders in use today allow drivers to indicate this to the 'traffic' market, and make a bid for space between the HOT lane and down town parking; say traffic light priority for sale. Hence the traffic market has a future, a 10-20 minute future. The market can take these cars, and hold them at the exit ramp; motors off for a few minutes; they can have coffee.. Then at the go moment, these cars go straight through all lights, right into the garage. Synchronized traffic.

So, the ultimate right of way holder on the lanes is selling a path between points that passes through various levels of traffic management; HOT lane, light priority, protected lane (BRT), all different asphalt modalities, but using a common market mechanism for lane sales.

The goal is to build a traffic space market that has a virtuous cycle.
In this market, rights holders can sell future lane space, sell it five years into the future, and fund current infrastructure; and manufacturers can plan technology advances, like wide spread lane guidance, where there is high pay off. The virtual lane market meets that goal, selling motion rights, which has a measured value independent of technology change to the roads or cars.

Looking at some numbers
The Interstate 15 between Victorville and Vegas is about 125 miles, a round trip is 250. Shaving an hour of the round trip and saving 30% in energy is about $35 per traverler. There are 10 million asphalt travelers along that route each year. So just passengers alone would get about $20 million in congestion fees. Adding up a; the sales segments on that road should generate $100 million in fees, and technology advances in lane guidance, high speed trams, and faster cargo; all that ups the price premium. I still see this as a higher return for bond investors than anything else in municipals.

Saturday, October 9, 2010

Google has a secret Robocar?

MOUNTAIN VIEW, Calif. — Anyone driving the twists of Highway 1 between San Francisco and Los Angeles recently may have glimpsed a Toyota Prius with a curious funnel-like cylinder on the roof. Harder to notice was that the person at the wheel was not actually driving. The car is a project of Google, which has been working in secret but in plain view on vehicles that can drive themselves, using artificial-intelligence software that can sense anything near the car and mimic the decisions made by a human driver.

Great, can we see the open software?

This report brings to mind the Pay for Speed, from my favorite Non-partisan candidate in Nevada. Let's make robo software mandatory for speeding cars, then let their cars drive on the HOT lanes at speeds to 90. Then, if they are on protected lanes the limit goes up to 110. Toll them all the way, and pay for new lane space.

Here is a blog posting about the project from a Google engineer.

Stuttgart Train Station, a case study in transportation re-engineering

The city is having a dispute about a large train station government is building.

Steel Trains, too heavy, too bulky, too straight, too big.

Mish states the case

Mish states his entire evidence chain on government over expansion and public unions; dumps on the Keynesians.

Yes and yes. Investors in municipalities should look for strong revenue streams backing up the debt, like utilities and transportation. We are nearing the end of musical chairs for general obligation state bonds of any duration.

Notes on the yield curve

What I look for is underneath the yield curve, the unquantized version under infinite dimensionality; hydraulic macro. I look at it as a normal frequency spectrum. What do I see?

The spectrum really peaks toward zero as it moves toward the long term, shaped like a production spectrum. At ideal equilibrium, the curve is Bell shaped, peaking around ten years.

Quantizing that curve put most of the long term into one 'bit'. The amount of the long term curve that trails over, across the Y axis, through zero, that portion is very small in good times, the curve is either peaked out near 7 years or we have rapid gains from sudden discovery and we are peaking close to 5. When the curve is flatter, more of it spills into negative territory.

This is standard, square integrable, 'signal processing' view.

Friday, October 8, 2010

Peter Gordon hints at multipliers less than one

In a post called Spend more, Get less.

More on the cost of commuting times

Tom Vanderbilt directs us to a study about the effect of long commuting times on absenteeism.

The problem is measureable to a typical 10-15% increase in absenteeism,

The knee jerk reaction here is to pose a "smart growth", changing density over time. But there is more on the menu, one of them is speed up the commute velocity, another is to let the commuter read the morning paper while commuting. Not to mention a third, reduce the number of changeovers. All of the solutions bound into two resources, silicon brains and existing asphalt roads. Make note of this, Venture Capitalists.

Why now?
We do something now we didn't do before, we click on something called Shipping Charge, we even get distance and time to ship, route and maps. A sign of an economy where the information technology advances much faster than transportation.

Back to the numbers
This cost is not 'in addition to' saved labor on reducing commutes, that is a fallacy of composition. The total cost of commute times are composed of many more partially correlated costs, probably five or six; with a multiplier of hidden costs.

Jed Graham gets causality wrong

when he claims a weak dollar is raising oil prices.
Really fueled by Congress

When we are constrained by energy, then the fiscal multiplier is very low. The correct causality is Congress increases inefficient oil imports, as a result the economy contracts and yields drop. The dropping yields lower the dollar.

Thursday, October 7, 2010

Sell BRT lane space to pay for expansion

I read a lot of transit agency reports, about funding to acquire lane space for BRT. Ultimately they get stuck on waiting for funds from federal government. These agencies have value outside of central government, their ability to repurpose existing lane, shoulder and meridian space. Use that valuable power to sell BRT space, before raising debt. Presell to private passenger bus companies, then to light weight cargo movers.

My mathematical model of the economy

I mention it often, it is based on the idea of precision.
The more bits of precision the production system has, the more accurate it can deposit final lot_size * transaction_rate at the short end, the consumer end. The economy can count smaller variations in demand for a more diverse array of products. Bits of precision indicates the rank of the distribution network, the length of its production chain.

This is the essence of the entropy model. Really just a finite queuing model.

My model has a hydraulic macro equivalent, the production spectrum. The model has a standard form for inventory growth along the production network, the generalized yield curve. In hydraulic macro this can be treated like a frequency spectrum, measuring the 'impulse' response or the sectorial or aggregate production response.

The difference between the regressed hydraulic model and the precision model is quantization. We would expect mass changes at higher level of production, both positive and negative; hence this model would view the paradox of thrift as mostly changes happening with economies of scale. Economies of scale imply quantization, intermediate steps in production are moved inside the firm, hence fewer market interfaces between stages of production, hence less accurate and a higher quant at the finest level of final demand.

Errors in the system occur where the level of inventory variation with respect to inventory averages exceeds a constant double bound, the constant SNR value.

My model is based upon a biological assumption, the economic brain operates with the same basic measuring capability across all environments, the uncertainty constant. The existence of this constant makes us comfortable in production chains, it makes specialization work, it makes us habitual. When things are too certain, we began a search for yield; when things too uncertain we began to contract in consumption.
The units of the uncertainty constant are: The number of items we can track before we are comfortable that one will be tracked badly. We would see this constant in measures of the optimum team size. We should have a neurological measure of entropy maximization by reduced pattern neuronal firing, that is a direct measure of entropy encoding by inhibitor neurons.

Wednesday, October 6, 2010

Mixing HOT lans and high speed protected lanes

Easy to do if the protected lane(s) are center and HOT lanes just outside.  Then we can create merge zones.

Important along the Interstate 15 speedway project.  We want to purchase virtual exchange services from the existing HOT and regular lanes.  Vehicles from the protected speedway, slowed down to human driver rules, should lease existing exchange usage, rather than build anew.

Traffic bandwidth can be bought, by the day, the rate, or many other terms.  Traffic light priority and extension has a price.  Sell yield rights.  All of this makes is much easier to fund the DOT services and get a continuous high speed bus path.  Start pre-selling traffic bandwidth along the I-15 corridor, today, promise much higher speeds, up to 120; much longer articulated vehicles, and point to point logistics by way of virtual lanes.

Compatible transponders
Standard across the industry, so vehicles in the HOT lanes get beepers from the fast movers in protected lanes.


KnoxNews and HT to Instapundit

We know what reverses the balance of payments

Oil at $83 and oil imports falling like a rock. Somebody is fixing oil to the dollar within a narrow range, a range that likely matches the supply chain physical limits. Of the culprits, we have consumers, manufacturers, or OPEC; or all three.

Another measure of the balance of payments, look at oil imports by volume and the Ceridian index, they match; oil imports leading the index even. But, both tied to transportation.

A real constraint, the cause of the depression, and caused by what?  The sudden arrival from the future of peak oil was brought to you by information technology, in the last ten years. We measure farther out with more accuracy, now the order of the day for the average citizen. Sudden information shocks makes things seem out of place and a cost results from having to hold futures contracts while things are moved about. In this particular case, we jumped in and acted as if we could rearrange inventory as fast we we could now track it. Transportation comes to a grinding halt and a Recalc ensues.

Economic Comment for the Day

How important was the 2008 oil peak to the cause of the Las Vegas crash?

Scott Sumner brings it up:
This data on Las Vegas tourism shows that 2007 was a record year for revenue (up over 5%) and number of tourists.  Hotel occupancy exceeded 90%.  Then tourism dropped off sharply in 2008 and 2009.  In my view the housing bust of 2007 destroyed relatively little wealth and had little impact on Vegas tourism.  In contrast, the sharp drop in AD in 2008 had a severe effect on tourism.  (High gasoline prices might have also hurt, but that problem quickly went away.)

That boom in the Vegas tourist industry was at the peak level of US oil imports (by volume). Peak pump price came later, in 2008. Take a look at today, we are operating with oil imports at the level last seen in 2003. And the most recent minor peak in imports came along with a $88/barrel price.

Watching the economy bump up against oil constraints twice. I live in the world of Disneyland and Vegas. Vegas is not only dependent on oil fueled tourism, Vegas is the canary in the coal mine when we talk about transportation bottlenecks. If Vegas is sick, look to transportation.

Krugman had a better diagnosis of Vegas, it is Stranded in Suburbia to the Max.

Tuesday, October 5, 2010

Pre-cast concrete for Protected Lanes

 Precast concrete pavement slab -- precut to accommodate epoxy-coated load-transfer dowels -- is lowered into place on Utah's I-15 near Clearfield.
[Photo courtesy of Road Science naming precastr concrete roadway one of the five top trends in 2010]

From the article, who is talking about the lower costs of precast?
“Precast concrete pavement systems have been shown to accelerate construction time and be economically feasible, while still maintaining the quality of conventional repair methods,” said Ken Berg of the Utah DOT Research Division.
As the virtual technical auditor for the I-15 Superhighway project, I am determined to keep per mile construction costs below $3 million per the desert run from Victorville east. That means we can service Vegas with basic road costs below a half billion, and still provide huge efficiency gains over rail.

One can actually look along the route (web map) and see plenty of meridian. Add snap together precast concrete lanes to reduce the process to two steps, dirt prep and slab assembly. Merges and over passes can use the same erector set technology.

Since the superhighway is traffic controlled, lanes are immediately reversible. Hence, very low cost single lane exchanges can cover all traffic patterns. Lanes are narrow, due to lane guidance, making simpler construction units. Modular lane units can be dis-assembled and re-assembled for route modifications.

So, the project would build a pre-casting factory mid-way, and produce the modular units. They are moved up I-15 during construction by using the same median right-of-way obtained from the rights holders. That is, move them along the super highway with the usual long constellations of rubber wheeled trains.

So on I-15, a least, we have the hope of newer, more efficient lane construction, simpler transition between existing HOT lanes and  Protected Lanes; with narrow gauge modular design, and digital traffic control from construction through operations.

The goal would be: Within a year from the start of construction to see some portion of the protected super lanes be in operation, built along with the deployment of the new HOT lanes starting very soon in San Bernardino.  In other words, get the word out to the county planners in San Bernardino.

Sunday, October 3, 2010

Off to the Farm

For a couple of days, its harvest time!

Let me recap what I see in the transportation markets. Reading the comments on blogs regarding the Nevada idea of "Pay for Speed", I find that commenters are just now getting the connection between toll roads and vehicle technology like lane guidance.

Soon consumers will get the whole connection, that speed and efficiency is safe with the new technology. The problem with Pay for Speed is the other drivers, the one who do not pay and who do not have lane guidance in their cars. These folks are the problem and the reason we have to curb off the advanced traffic on high speed tollways. That education process is taking place, especially among the transportation research groups.

Crowd sourcing in transportation, getting people to reveal where they are and where they are going, is the big thing right now. But those applications should quickly merge into the general application of semi-autonomous driving technology. Once the new applications are visible I expect a huge demand for high speed and lower latencies; demands that local transit agencies will satisfy with private toll road operators.

California is full speed ahead in converting diamond lanes into toll lanes. These toll lanes will be a popular testing ground for the lane guidance and collision avoidance technology that is now optional on many new cars.

One key here are the insurance companies, they have to continue pounding the safety features of semi-autonomous driving. Once the consumer tries out the autonomous features at high speed, then the deal is done and the revolution takes place.

Let me summarize:
Drivers will love the networked semi-autonomous car. Insurance companies will love the black box. The driver then demands speed, simply because he relies on lane guidance and collision avoidance. This results in a demand for curbing the toll lanes; yields the transportation revolution.

Car radio is toast

AM and FM radio in the car will go away, replaced by internet connectivity.

Nevada economy faces extended losing streak

Once one of the fastest-growing states, Nevada now faces the prospect that recovery from its deep economic slump will lag -- perhaps substantially -- a national rebound.

Nevadans are resigned to that dour outlook. A recent Mason-Dixon Polling & Research Inc poll found 42 percent of residents expect the state's economy to stay the same over the next year and 29 percent anticipate it to worsen.

They have good reason to be glum. Credit counseling agency CredAbility ranks Nevada as the most financially distressed state.

"It's the only state at a crisis level," said John McCosh, a spokesman for the Atlanta-based credit counseling agency.

Nevada Casinos have to get people into town cheaper. Casino owners will figure it out, or go broke trying. But their slump is a transportation issue. Compare and contrast how Utah dives straight into the new technology, they are bleeding edge with their toll lanes and BRT. Utah gets it and their unemployment rate is about 7.5%. The Nevada legislator, on the other hand, just dropped a toll road proposal that would have made for smooth sailing into the Vegas strip from the south.

Saturday, October 2, 2010

Utah sees wide interest in their I-15 tollway

Toll road news reports:
Toll lanes on Utah's I-15 the main north-south drag through Salt Lake City have got off to a chaotic start with gross underpricing. At a mere $50 for a monthly pass 600 decals sold out in just over an hour Thursday. Sales on the project website began at Aug 10 08:00 with two-thirds sold in the first 10 minutes.

Passes were completely gone at 09:22.

Unknown thousands of frustrated buy-ins to the HOV lanes wasted their time trying to buy passes throughout the day.

UDOT and contractors grossly underestimated public interest in the project. Communications links failed. The project website - - was overwhelmed. The website got patched up long enough to sell the available passes but has been down since. When we tried at 09:22 EST today (Friday) it was still down!
Good news is - the strong customer demand

Of course the good news is the strong underlying demand for an express ride, which helps justify the project, and suggests a potential revenue stream which will justify a serious toll system. Free flow has great value to motorists, obviously way more than $50/month.

Time savings in using the express lanes are put at 11 to 20mins per trip. At say 30 trips per month that's 5.5 to 10hrs time savings. The calculations produce a value of time saved of $5 to $9.10/hr. Obviously there are a lot more than 600 people in the southern part of Salt Lake City who value their time more than those numbers!

Drivers in this case save $90 per month in time but only pay $50. As people pay, they want more speed; and that means lane guidance will quickly become standard in all cars. As in:
Middle America speedway. The nation’s fastest area is in the middle part of the country. Seven of the top 15 states with the fastest highways are in that area. The average speeds on roads in Mississippi, Nebraska, Kansas, Iowa, Idaho, Alabama and Missouri exceed 67 m.p.h; the average posted speed limits in those states is 70 m.p.h.

As blogger Elliot found out when analyzing the TomTom Speed profile.

Utah generally gets these things right and maybe Utah will be the first with much faster lane guided speedways.

Good news from auto insurance

Business Review reports:
According to the National Highway Traffic Safety Administration (NHTSA), automakers cited cutting-edge, lifesaving auto technologies as a primary factor in 2009's record low traffic fatality rate. The administration's Fatality Analysis Reporting System (FARS) showed a 10 percent drop in road fatalities from 2008 to 2009 and also showed the lowest fatality and injury rates in U.S. history: 1.13 fatalities per 100 million vehicle miles traveled in 2009.
"What we are seeing now is the payoff from years of manufacturer-driven safety improvements, like anti-lock brakes and electronic stability control systems coupled with high visibility enforcement safety efforts by law enforcement," said Alliance of Automobile Manufacturers President and CEO Dave McCurdy. "For years, automakers have been focused on adding safety technologies that have the biggest impact on the most people, and we're seeing the results in the actual numbers and statistics. Cynics have said that declining traffic deaths were caused by the recession. So we are particularly gratified to see these record reductions continue, even as vehicle miles traveled (VMT) rose again in 2009. There's never been a safer time on our roads.

Driver automation saves the consumer money.