Sunday, 21 August 2011

09:28 – According to this article, outstanding college student loans are on track to exceed $1 trillion this year. People are finally starting to question just how much benefit these students are getting in return for shackling themselves with huge amounts of debt.

The final paragraph of the article begins, “[b]eyond dispute is the value of a higher education diploma, notwithstanding the risks associated with borrowing heavily to obtain it”, which is a fine example of the logical fallacy post hoc ergo propter hoc. Correlation does not imply causation. Yes, it is beyond dispute that college graduates, on average, earn more than those without a college degree. But what is not beyond dispute is whether the college degree itself actually has anything to do with those higher lifetime earnings.

Consider this: about 27% of US adults hold a bachelor’s degree or higher, with another 27% having attended college or received an associates degree. So, roughly half the adult population of the US has at least some college. Few would dispute that, on average, those people are smarter and work harder than those in the other half. If colleges did not exist, one would expect that that smarter, harder-working cohort would be more successful and earn more than the dumber and lazier cohort.

The question becomes whether a smart, hard-working person is better off spending four years or more and tens of thousands to hundreds of thousands of dollars to attend college, or hit the ground running and get a four-year head start without incurring a crushing debt burden. Intuitively, it seems obvious that if one has what it takes to become a professional, it makes sense to take that front-end hit in the interest of earning more down the road. But it’s by no means obvious that less stellar performers should make that decision. In short, if you have what it takes to become a physician or other professional, you’re well advised to spend the time and money to get a degree. If, on the other hand, you plan to major in history or literature or sociology, you’re wasting four years and a lot of money that you’ll never get back, particularly when you consider the time value of money.

Barbara and I spent some time yesterday getting my kit assembly work area cleared out and organized. Until now, component inventory storage has been haphazard, with cases of components stored wherever there happened to be a free space. When I was assembling a batch of, say, half a dozen kits, I’d have to go here and there to get the components for them as I was packing them, which made everything take a lot longer than it should.

We moved all the stuff that had been stored on the shelves behind my work area to shelves elsewhere in the basement, so now when I need, say, two dozen 250 mL beakers, I can simply turn around and pull two boxes of a dozen beakers off the shelf behind me. We also cleared a lot of workspace that had had components stacked on it. Rather than build batches of half a dozen, now that I have more workspace I can easily do batches of two dozen, which makes things a lot faster. It should now take me only half again as long to assemble two dozen kits as it was taking for each run of half a dozen. It also makes it a lot easier to keep visual track of inventory levels.

Saturday, 20 August 2011

14:37 – Here’s my first cut at the 25 slides I’ll include in Slide Set A.

Amoeba, wm
Bacteria, three types (rod, coccus, spiral)
Blood, human, sm
Bone, dry ground, cs
Diatoms, mixed, wm
Euglena, wm
Fucus (brown algae), cs
Grantia, cs
Hydra, budding, wm
Liver, frog, cs
Liver, mammal, cs
Meiosis (grasshopper)
Meiosis I (plant cell)
Meiosis II (plant cell)
Mitosis, onion (allium) root tip [monocot]
Monocot and dicot leaf, cs
Monocot and dicot root, cs
Monocot and dicot stem, cs
Muscle, three types (cardiac, smooth, striated)
Mushroom, cs
Oscillatoria (blue-green “algae”, cyanobacteria), wm
Paramecium, wm
Rhizopus sp. (bread mold)
Spirogyra, conj, wm

Unfortunately, this slide set will be in competition with the junk Chinese slide sets sold by many homeschool supplies vendors, which typically sell for $35 or so. We simply can’t meet that price, and I refuse to use Chinese-sourced slides. Better, Indian-sourced slide sets typically sell for twice that much or more. Here’s a typical example, a $73 set of 25 general biology slides from Nasco. (Interestingly, in the absence of cheap Chinese slide sets, I’d probably have priced this slide set at $75.) Unfortunately, with cheap Chinese sets readily available, I suspect few home schoolers would pay $70+ for a set of 25 general biology slides, even if they are better than the Chinese sets. I think I’m going to price our Slide Set A at $50. At that price, we won’t make much money, but at least we won’t lose money. And homeschoolers get a good deal on a decent slide set, although I suspect many of them won’t realize they’re getting a better than usual deal.

And, speaking of prices, we’re going to have to raise the price of the chemistry kit once we’ve sold out the current batch. Each time I reorder, I’ve seen prices increase, often by 5% to 15% compared to orders from just a few months ago. The most extraordinary example is potassium iodide. Before the Japanese nuclear plant catastrophe, I was paying about $125 per kilo for reagent grade potassium iodide. I expected the price to shoot up and then fall quickly back to normal once the panic was over. The price did shoot up, but it’s remained there and from what industry sources tell me it’s likely to remain there. I just checked the other day, and the lowest price I found from anyone who actually had the stuff in stock and was willing to ship it to me was over $500 per kilo. I see that Home Science Tools is still advertising lab grade potassium iodide at $4 for a 30 gram bottle, which comes to about $133 per kilo. I’m half tempted to log on to their web site and buy every bottle they have in stock.

Well, more than half-tempted. I use a fair amount of potassium iodide in the kits, and I’m down to maybe 300 or 400 grams in stock. My regular vendor can supply me, but only at the higher current price. Lab grade KI is fine for most or all of what I do, so I just ordered 25 bottles of KI from Home Science Tools. That’s 750 grams, which’ll be enough for quite a while. I didn’t want to make a pig of myself, and not leave any for anyone else. So, if you foresee needing any KI in the near future, you might want to grab some while HST is still selling it at that price. My guess is that they’re using FIFO cost accounting and when that inexpensive stock runs out, they’ll reprice a 30 g bottle at something like $12 or $15. Either, that, or they’ll cut it from 30 g to 15 g and price it at $6 or $7.

Barbara and I made a post office run and then headed over to the lawn and garden center to pick up a 4 cubic foot bag of vermiculite, which I’ll use as an absorbent and cushion in packing the kits. U-Line sells pretty much the same stuff for a few bucks less, but charges more to deliver it than the stuff itself costs.

I was momentarily confused when I saw the sales tax rate on the invoice. I was thinking that NC cut the sales tax from 7.25% to 6.25% on 1 July, but in fact they cut it from 7.75% to 6.75%. Which brings up an interesting issue. I’m tax-exempt for resale purposes, but I still have to pay sales tax on items purchased for business use. For example, I include a purple Sharpie marker in each of the chemistry kits, so I don’t have to pay sales tax on those Sharpies. But if I buy a box of Sharpies for office use, I do have to pay the sales tax. My rule is that anything that goes in or on the box–labels, packing materials, and so on–is tax exempt. Technically, the vermiculite falls into that category because I’m using it for packing. Although no one would ordinarily think of it as “selling” vermiculite to customers, that’s in fact what I’m doing.

In reality, I usually buy only minor items locally, so I just ignore the sales tax as a cost of doing business. Technically, I could file for a refund, but it’s not worth the hassle. For example, I just ordered two things from Costco: a pack of 100 file folders, and a box of 500 coin envelopes. Costco, of course, collected sales tax on both orders. The file folders are for business use rather than resale, but the coin envelopes are used as packaging in a future kit. So, the couple bucks of sales tax I paid on those envelopes could be reclaimed, but it’s not worth the time to fill out the necessary form.

Friday, 19 August 2011

08:52 – Barbara and I drove out to the body shop this morning to pick up her car, only to find out that it wasn’t ready. Originally, it was supposed to be ready Wednesday afternoon. When I called Wednesday around lunchtime to check, the guy who was doing the work said they were having problems with their spray booth and he wasn’t sure it’d be ready that afternoon. He said it would be ready by Thursday at lunchtime. I told him that Barbara worked, and first thing Friday morning would be better for us. He said that’d be perfect, so we just headed out this morning to pick the car up. Apparently, the spray booth problem took longer to resolve than they expected. They promised the car would be ready in a couple hours, but Barbara had to go to work. So the body shop is going to send someone over to pick me up when the car is ready.

I’m still working on the prepared slide sets. The first set, Slide Set A, has 25 slots available, of which I currently have 19 allocated. The problem is, it’s an iterative process. I have to make sure I have at least one source for every particular slide, and ideally a second source as well. Then I have to correlate the slides I’m choosing with the text. If it turns out that I can’t reliably source a particular slide, I have to re-write the text to use a different slide that I can get. And that may in turn affect other slide choices.

It’s all a balancing act. I’d like Slide Set A to represent as broad as possible a selection across kingdoms and phyla, but at the same time be deep enough to be useful. The depth requirement mandates, for example, that I allocate three of the 25 slots to monocots and dicots: cross-sections of a representative monocot and dicot leaf, stem, and root. I’d like to include a representative monocot and dicot flower bud as well, but that’ll have to be in Slide Set B. Similarly, I’d like to include both a cross-section of a Grantia and Grantia spicules, but there isn’t room for both in Slide Set A, so the spicules slide will have be in Slide Set B or even C. Oh, and I’m trying very hard to keep the price of the 25 slide sets A and B to $50 each or less.

11:14 – I just got back home with Barbara’s car, which looks fine. That was the first time I’d driven it, and probably the first time I’ve driven a car-car in 15 years or more. I’ve been driving SUVs since I bought my Jeep CJ in 1979. Driving a car reminds me of riding a motorcycle. Both are low, nimble, and zippy compared to driving a heavy truck.

Speaking of which, the other day I was talking to my neighbor about motorcycles. He still rides. I haven’t ridden in 30 years, although my driver’s license still has a motorcycle endorsement on it. Yesterday while I was walking Colin, Steve was out working on his bike. He asked if I wanted to give it a try. I told him that was tempting, but I hadn’t been on a bike in 30 years and Barbara would kill me when she found out. Assuming I survived the ride. So I regretfully declined.

I do miss it, though. I had a superbike, a Honda 750F that I paid a guy a lot of money to performance tune. We did a timed run once. Zero to 60 MPH in 2.8 seconds with my weight on it, and I was still in first gear when I hit 60, cranking over 10,000 RPM. As someone commented at the time, that bike accelerated faster than a fighter jet on take-off. Of course, the fighter has a better top end. My bike topped out around 140 or 145, or maybe 150 downhill with a tailwind. But I was always reasonable on the Interstate, seldom exceeding 135.

Barbara and I were watching a Numb3rs episode the other night, and it showed one of the characters printing a letter rather than using cursive writing. That got me to wondering. Do schools still teach cursive handwriting nowadays? If so, why? I haven’t written anything other than my signature in cursive in at least 30 years. I print everything. I don’t even use upper and lower case. All the characters are uppercase, with those that would normally be lower case just smaller versions of the upper case letters. I can print at least as fast as I can write cursively, and the result is much more easily readable. I wonder if cursive is becoming a lost art. Do homeschoolers teach it? I understand that one of the arguments for teaching cursive is that it helps kids learn to control their hand and finger movements very precisely, so perhaps there’s still a place for it.

Thursday, 18 August 2011

08:45 – Pity the poor European Central Bank, which has the tiger by the tail. Two weeks ago, the ECB began buying Spanish and Italian debt. That intervention worked, driving down Spanish and Italian bond yields from considerable more than 6% to the 5% range. That still isn’t good, but it puts off the crash a bit longer.

The problem is, having started, the ECB can’t stop buying Spanish and Italian debt because no one else will buy it. With Spain and Italy no longer having access to the capital markets, if the ECB doesn’t buy their debt, the yields will jump catastrophically. We saw this happen with Greece, Portugal, and Ireland, and it will most certainly happen with Spain and Italy. Rather than 5% yields, we’d soon see yields climbing into the 10%+ range, and eventually probably into the 20% range, as happened with Greece.

That means the ECB must buy essentially all debt offered for auction by Spain and Italy. Considering rollovers, interest payments, and new debt already scheduled to be auctioned, for the remainder of this year that comes to something like $50 billion per week. Call it $1 trillion between now and the end of the year.

And, in an incredible irony, Finland announced yesterday that it would require full collateral from Greece if Greece expected Finland to participate in the Greek bailout. In other words, Finland wants Greece to cough up enough cash to allow Finland to buy AAA bonds as collateral against Finland’s share of the bailout. Of course, if Greece had any collateral it wouldn’t need the bailout. Later yesterday, Austria, Slovenia, and Slovakia also announced that they’d require collateral from Greece before they participated in the bailout. The Netherlands is expected to require the same. In other words, all of these countries, and others likely to make similar demands, are running as fast as they can away from the Greek bailout, which means the Greek bailout may never happen.

The real irony, of course, is that everyone is pretending this is a liquidity crisis, when in fact it’s a debt crisis. And Greece is small potatoes compared to Spain and (particularly) Italy, and eventually Belgium and France. The simple truth is that these countries owe far too much to have any chance of ever repaying what they owe, and that bill is quickly coming due.

I have to order a new Pentax DSLR. The one Barbara took to work was damaged by a power surge, and her firm is reimbursing us for the cost of a new camera. The damaged camera still functions, but the power surge killed its USB port, which is essential for using it on a microscope. Her firm will keep the damaged camera, which still works for shooting images. It’s no problem for them to transfer images by removing the memory card and putting it in a card reader.

I plan to order a Pentax Kr, which is the nearest current model to the one we’re replacing. One thing I insist on is the ability to use AA cells. The Kr comes with a lithium-ion battery, but AA-compatibility is now optional, via the $40 D-BH109 adapter. I’ll order it with the kit lens, which is an excellent 18-55mm zoom. I’ll also order a fast memory card or two for it. I haven’t looked at memory cards lately, but I’m assuming that 4 GB and even 8 GB cards are pretty inexpensive nowadays. At 12 megapixels, a 4 GB card would probably give me roughly 200 image files in RAW format per card. The last time I bought a memory card, fast cards were roughly twice the price of slower ones, so I might be able to get a fast 4 GB card for what I’d pay for a slow 8 GB card. Any advice would be appreciated.

Wednesday, 17 August 2011

08:37 – The results of the Merkel-Sarkozy summit are in, and they’re exactly what I predicted. Nothing whatsoever. Merkel and Sarkozy issued a statement expressing their joint determination to do whatever it takes to defend the Euro, as long as it doesn’t involve them spending any money. No Eurobonds, no expansion of the pathetically small bailout fund, nothing. Business as usual, in other words.

Oh, come to think of it, they did propose that all 17 Eurozone nations be required to amend their constitutions to include a balanced budget amendment and cede their national sovereignty to Germany, which would in turn agree to make the trains run on time. And, in a sop to hard-pressed European banks, all of which are bankrupt by any normal definition of that word, they also proposed a Tobin tax on financial transactions, which would merely drive economic activity out of the Eurozone. Fortunately, actually implementing anything they proposed will take years, by which time the Euro will be only a distant memory. In effect, Angie and Nick sat around discussing which hors d’oeuvres to serve at their next dinner party while their house burned down around them.

I spend some time yesterday looking into prepared slides to include in the kit for the biology book. There are two alternative, neither of them good. First, I can buy prepared slides sourced from China or India. Some of these are actually quite good, and they can be priced at only a couple bucks each on average. The problem is figuring out exactly what they are. I can’t buy slides from the companies in China and India that actually make the slides. I have to buy from US distributors, who have no clue what the slides actually are. If I’m lucky, they’ll specify the genus and species of the specimen or the type of section. If I’m very lucky, they’ll specify the genus and species of the specimen and the type of section. If I’m extremely lucky, they’ll specify both of those and the type of staining.

And it’s nearly impossible to ensure that a sample slide I look at will be representative of the actual slide when I order it in bulk. For example, yesterday I asked a distributor rep if I ordered a slide set from them if it would have the exact same slides that I could order from them individually in bulk. She said yes, but then added, “But sometimes they’re dyed different colors.” Arrrghhh.

The alternative would be to order slides from the one US company that still produces them. Those slides are absolutely gorgeous. I’ve seen examples. And, rather than the two or three word description common with Chinese and Indian prepared slides, their descriptions often run a paragraph, giving details about the exact species, histology and sectioning method used, and staining protocol. The problem is, those slides sell for $6 or $7 to $25 each. A set of 25 slides could easily run $250 or $300. That’s far, far outside the budget of most home schoolers, who see apparently similar sets advertised for $50 or $60.

Unless I can find a reliable source of inexpensive prepared slides, I suspect that what I’m going to end up doing is ordering inexpensive prepared slides in bulk and then checking each individual slide before adding it to a set. For example, if I’m putting together 100 sets of 25 slides, one of which is Amoeba proteus, I’ll order 100 Amoeba proteus slides and run each of them through my microscope to verify that it’s usable. I can probably verify 100 slides per hour, which means that 100 sets of 25 slides will require 25 hours of my time just to verify the slides.

Actually, it may not be that bad. I used the A. proteus example because I once saw a Chinese prepared slide that was allegedly A. proteus but had no amoeba under the coverslip. For most specimens, that won’t be a problem. I can simply view one slide and if it’s acceptable the others will also be acceptable. But for “feature” slides, such as a slide showing specifically a particular stage of meiosis, I’d need to check each slide.

Tuesday, 16 August 2011

08:50 – I just followed Barbara out to the body shop, where we dropped off her car. The guy told her yesterday when she stopped by for an estimate that it was a “pound-out” job, and that he wouldn’t need any replacement parts. We’ll pick up her car tomorrow afternoon or Thursday morning. Meanwhile, Barbara is driving my Trooper, which used to be her Trooper. The insurance company offered a rental car, but it’s not worth the hassle for a two-day repair.

Work continues on the biology book. I’m also ordering stuff to prototype the biology lab kit.

09:09 – I see that S&P has just been downgraded to junk-rater status, leaving Moody’s and Fitch as the only real ratings agencies. As the federal government pointed out at the time, S&P made a $2 trillion dollar calculation error, without which the US rating would have remained AAA even under S&P’s modified rules. I think Warren Buffett spoke for most knowledgeable people when he said that rather than reduce the US credit rating from AAA to AA+, S&P should have increased it to AAAA. The simple truth, as evidenced by bond yields and CDS prices, is that the market considers US debt to be by far the safest in the world, far better than that of other countries that are rated AAA. If Moody’s and Fitch have any sense, they’ll create a new AAAA or even AAAAA rating and award it to the US and only the US.

12:09 – The much-anticipated conference between Merkel and Sarkozy started a few minutes ago. I’ll predict that they’ll do nothing but talk. That’s understandable, because there is no action they could take that would save the Euro. They’re powerless, so they might as well have a nice chat. I very much doubt they’ll do anything other than agree to support the decisions made at the 21 July summit, which of course is and was a joke. Sarkozy will be pushing for boosting the ESFS, which Merkel and the Germans will refuse to pay for. Sarkozy will also be pushing for Eurobonds, which again Merkel and the Germans will refuse to pay for. Ultimately, the problem is that almost all of Europe is bankrupt, with huge debts that they have no hope of ever repaying and economies that are so unproductive that most of them aren’t even keeping up with population growth. What should happen is that Germany, Holland, Austria, and Finland abandon the Euro and let those profligate countries that remain on the Euro go bankrupt. I’d like to see that announced after the conference, but the chance of that happening is nearly zero.

Monday, August 15 2011

08:03 – We’re back in stock and shipping on the chemistry kits. This week will be heads-down work on the biology book.

Barbara and I made a Costco run yesterday. As we exited Costco, Barbara signaled and started to change into the left lane and we were sideswiped by a blue sports car. Barbara jerked our car back into the right lane, and at first I wasn’t even sure the two cars had made contact. The driver of that car just continued driving down the road, and Barbara followed her. She turned off into the PetSmart parking lot, where we looked at the damage to the two cars. There wasn’t much apparent damage. Some scraping of the paint on both cars and minor dents in the panels.

Both Barbara and the other driver, a young woman named Marisa Barrone, were quite calm. No one was injured. She said she’d blown her horn, but neither Barbara nor I heard it, although we didn’t have the radio on. My guess is that she was moving a bit fast and perhaps talking on her cell phone. At any rate, things remained friendly and we called the police and waited for them to arrive. The cop didn’t issue a ticket to Barbara. I’m not sure whether or not he ticketed Marisa. So this morning I’ll call our insurance agent and find out what we have to do to get Barbara’s car repaired.

Sunday, 14 August 2011

11:28 – Colin is now officially a Fearsome Predator. Ever since the robins showed up this spring, Colin has been trying to catch one. I keep telling him that he can’t catch birds because they can fly away. Today, Colin successfully stalked and pounced a robin that was too busy listening for worms to pay proper attention to the Fearsome Predator nearby.

Fortunately, no robins were harmed during this exercise. Colin carefully stalked to within about 10 feet (3 meters) of the unwary robin. Colin then fired off the afterburner and accelerated from zero to top speed in about one step. The robin saw him coming and tried to fly, but Colin overran it before it could get airborne. Border Collies have all the hunting, stalking, and pouncing instinct of wolves, to which they are closely related, but have all of the kill instinct bred out of them. So Colin didn’t chomp the bird, satisfied with merely overrunning it. The bird was knocked sideways, but quickly recovered and took off pretty much straight up. It didn’t even lose a feather, but it’ll have a story to tell the wife and kids when it gets home.

Saturday, 13 August 2011

11:58 – The Euro farce continues to degenerate. All parties are desperately searching for a solution, except Germany and the other conservative northern tier countries, which know there is no solution. The Euro is and always has been fundamentally broken. Every competent economist knew that even before the Euro was introduced. Even I knew that before the Euro was introduced.

The fundamental problem is that it is impossible to have a monetary union without a fiscal union, and Germany, the Netherlands and Finland would be insane to agree to such a union, particularly now. As Milton Freidman predicted back around the time the Euro was adopted, it would collapse at the first serious economic crisis. And that’s exactly what’s happening now. Also, as I and others predicted, the ridiculously expensive social programs in Europe would bankrupt them, and that too is coming to pass.

Simply put, there is no solution to the Euro problem, or at least there is no solution that is acceptable to all parties involved. Greece, Portugal, Ireland, Spain, Italy, and other bankrupt EU nations are now clammering that there’s no alternative to a fiscal union, starting with expansion of the EU bailout fund from its current €440 billion to something in the €3 trillion to €4 trillion range and followed by the introduction of Euro bonds, which are basically blank checks that allow the bankrupt EU nations to borrow as much as they wish and have Germany pay the bills. The problem is, Germany is no more likely to agree to those measures than I am to cosign a mortgage loan for a homeless drug addict. At least I’d have a better chance of being repaid than Germany would.

The only possible solution is one that European politicians are not (yet) ready to speak of. Germany and the other rich northern nations need to leave the Euro and go back on their own currencies. That leaves the Euro bankrupt, along with all of the countries that would still be using it, including France and Belgium. Holders of Euro-denominated bonds from those bankrupt countries would lose essentially everything. They’d be lucky to get one cent on the Euro. But eventually the markets would adjust. Greece, Portugal, et al. would not be able to borrow any money, and would return to being very poor nations, which they’ve actually been all along.

I’m doing laundry, and I just went into my lab to collect towels. It occurs to me that one of my unusual personality quirks is how I handle used towels, paper towels, surgical gloves, disposable pipettes, and so on as I’m working. I toss them on the floor, to be collected and washed or disposed of later. Same thing on the very rare occasions when I contaminate a set of splash goggles. Onto the floor they go, and I pull a new set off the shelf.

I actually remember when I started doing this, as a teenager working in my darkroom. I dried my hands with a towel, which turned out to be contaminated with a processing chemical. I then touched a print, which was ruined. From that day forward, as soon as something becomes contaminated, onto the floor it goes. That way, I know that an item on a counter must be uncontaminated, or it would be on the floor. So, there is method in my madness.

Friday, 12 August 2011

08:56 – Colin turns 6 months old today. He’s a huge puppy, already as large as most adult male Border Collies. Duncan was a big boy, at 75 pounds (34 kilos) and about 4″ (10 cm) taller than other male BCs, but I think Colin will be bigger still.

The US Postal Service is losing $8 billion a year and is now in what amounts to Chapter 11 bankruptcy, or would be if it weren’t a pseudo-government agency. It’s due to make a $5.5 billion payment to its retirement fund next month which it doesn’t have the money to make. The USPS has announced plans to cut 220,000 jobs, or 30% of its workforce, between now and 2015. About 100,000 of those will be by attrition, but the remaining 120,000 will be actual people losing their jobs. It also plans to close thousands of post offices.

That’s actually much too little, much too late, and doing the wrong thing anyway. Service levels will be badly impacted by those cuts, which will in turn further reduce mail volume as mailers shift even more quickly to alternatives. What the USPS needs to do is:

1. Eliminate rural free delivery, which is extremely costly. Establish population-density metrics to determine whether any particular home or business is eligible for free delivery or must pick up its mail at the nearest post office.

2. Negotiate “last mile” delivery agreements with UPS and FedEx, whereby UPS and FedEx deliver packages to USPS distribution centers, and the USPS makes the local deliveries to the recipients. Eventually, eliminate most local deliveries by USPS personnel and negotiate contracts with local businesses for last mile deliveries. That is, the USPS should be making one delivery per neighborhood to a local contractor who actually delivers the mail and packages to homes.

3. Crush the postal unions and reduce pay and benefits to no more than a third of what they are now, for both current employees and retirees. Right now, post office employees are paid at least two to three times more than they’d earn for doing the same job in private industry. Retirement and medical benefits are ridiculously high. All of that needs to stop if the USPS is to have any chance of surviving.

Despite the protests of the Big Three credit-rating agencies and the French government, the market believes that France doesn’t deserve a AAA rating. And they’re absolutely correct. If the USA is only AA+, France should be at least two or three levels below that. Forget S&P and Moody’s and Fitch. If you want a real credit rating, all you need to do is look at what the free market says the credit ratings really are. That’s what the basis points on credit default swaps provide, and it’s instructive to look at CDS prices for the various countries.

Greece ~ 1,800
Portugal ~ 900
Ireland ~ 800
Italy ~ 400
Spain ~ 400
France ~ 150
Austria ~ 140
Germany ~ 90
UK ~ 85
US ~ 55

A basis point is 0.01%. These CDS prices vary constantly, but they represent the actual free-market cost to insure a bond against default. So, for example, the one-year premium to insure $1,000 of Greek bonds against default is $180, while at the other end of the risk spectrum, it costs only $5.50 to insure $1,000 of US debt for one year. That’s why it’s ridiculous for ratings agencies to assign AAA ratings to the UK, Germany, Austria, and France while assigning the US a lower rating. The free market gives the real ratings, and they’re completely out of line with what the ratings agencies are saying. I know which I trust more.

11:22 – This has been a stunning week for medical discoveries that are potentially huge breakthroughs. Earlier in the week, a PLoS paper reported incredible results with a process called DRACO, in which cells that have been infected by a virus (and only those infected cells) can be forced to undergo apoptosis, which kills the infected cells, leaving the viruses without host cells. The really significant thing about DRACO is that it is not virus-specific, like nearly all current antiviral treatments. Any cell that has been infected with any virus (presumably; DRACO was shown to be effective against 17 widely different viruses) is detected and eliminated. And here, Derek Lowe reports on a potential breakthrough that does pretty much the same thing against leukemia, and presumably eventually other cancers.