Random Musings

Remember this?:

In the simple Keynesian model of Aggregate Demand (AD) in an economy:

AD = C + I + G + X – M

C is consumption which is a function of the Marginal Propensity to Consume (MPC) and taxes (T); obviously if the MPC is higher then C is higher (ceterus paribus or all other things being equal) and if T is higher then C is lower (ditto)

I is business investment, should probably be expressed as I-sub-g for gross investment but I wanted to keep the terms simple

G is government spending

X is exports

M is imports

This model was the rationale for Keynes advocating government spending, without raising taxes, as the best way to get out of the Great Depression.

Implicit in the policy views of virtually all current Democrats is that unless the stimulus is direct government spending, then the MPC is basically zero as is the Marginal Propensity to Invest (MPI). This is provably false.

Implicit in the policy views of virtually all current Republicans is that cutting taxes is always a better stimulus than raising government spending (a debatable proposition) and that the MPC and MPI approach one, which is false. No deficit-financed tax cut has ever completely paid for itself, but tax cuts always boost GDP although the magnitude and duration of the boost can vary greatly.

The only political axiom to which I subscribe is that no matter where one thinks they stand on the political spectrum, much of the truth is usually somewhere else.

 

From this very recent CNBC article comes this headline:

“Capital expenditures surge to 25-year high, R&D jumps 14% as companies spend tax cut riches freely“

The MPI is not zero. Of course companies have also increased buybacks, but buybacks are not the only thing on which companies are spending their newly increased profits. The MPI is not zero. By the way, the information used in the headline comes from Goldman Sachs.

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People may have equal rights under the law, but people are not created equally. That fact may be an inconvenient truth, but it is still a fact.

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The Quickest Cars We've Tested, From 1955 to Today - Slide 4

From Car and Driver a picture of a 1959 Ferrari 250GT California Spyder. Why am I showing this picture? If I had written that the car was a 1989 model, would you have doubted it? This picture is part of a Car and Driver “Flipbook,” a slide show of related photos. This Flipbook was about the quickest cars C&D has ever tested. Compared to the other (mostly American) cars from 1959 the Ferrari looks like something from far into the future. Look for yourself:

The Quickest Cars We've Tested, From 1955 to Today - Slide 5

This is a picture of a 1958 Chevrolet 315 Delray from the same Car and Driver Flipbook. I originally wrote that the car was a 1959 model because that’s how Car and Driver labeled the car. 56packardman pointed out that this is really a 1958 model, which I guess I should have known from the rear deck, but who am I to doubt Car and Driver?

This Chevrolet, regardless of year, is very dated in exterior design while the Ferrari is timeless. One may be a fan of the Delray’s looks, but it is impossible in my opinion to avoid the previous conclusion.

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I don’t follow sports anywhere near as closely as I have in the past. Baseball “divorced” me after 20+ years; the NFL is awash in protests, boorish owners and too many penalties. I have not been interested in the NBA since the early 1980s and lost interest in the NHL not much later.

All that being said I wanted to mention the amazing start of Patrick Mahomes, who is in his first year as a starting quarterback in the NFL for the Kansas City Chiefs. He has set a record by throwing 10 TD passes in the first two games of the season. That accomplishment is impressive, but he has also not thrown an interception.

Despite what fantasy football geeks think (fantasy football is well-named because it bears little or no resemblance to the real thing), the only two individual stats that really matter for a quarterback are Yards Per Pass Attempt (YPA) and Interceptions. What is Mahomes’ YPA through two games? It is 10.58 compared to a league average that always finishes very close to 7.00.

Of course it’s just two games. The real reason I wanted to mention Mahomes is to show that many ways exist to succeed. Peyton Manning once said (I wish I could find the reference, but you’ll just have to trust me) that an NFL QB needed to make 300 pass attempts in regular season competition to adjust to the speed of the game. Mahomes had made just 35 such attempts before this season started, but did basically spend a “redshirt” season sitting on the bench behind Alex Smith. Mahomes was a first-round draft pick in 2017.

Most first-round quarterbacks end up with meaningful playing time in their rookie season. That might not always be the best thing.

 

 

 

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Pictures From A Sunny Sunday/Ed Cole

Yesterday was the annual car show held by a local museum that I look forward to every year. (Sorry for the poor syntax, but I am very tired.) I have come to the realization that I REALLY love cars (the definition of DUH!) and have to be involved in the automobile industry in some way. If anyone has any original ideas, I am all ears.

This 1955 Packard Caribbean convertible literally moved me to tears. 56packardman.com has informed me that, besides being his favorite 1955 color combination, the colors are White Jade, Rose Quartz and Grey Pearl Metallic. The owner of this car also brought a 1954 Cadillac Eldorado and 1957 Cadillac Biarritz to the show. I don’t know the exact number, but I would estimate the total number of cars at about 575. For the nth time I am so tired of the homogenized offerings of today’s large automobile manufacturers. I think the debilitating sameness explains why so many car aficionados gravitate towards exotic cars like Ferrari and Lamborghini.

 

This real 1937 Cord was the biggest surprise of the show. The owner of this car owns about 25 cars, but this was the only one he brought to the show. I attended the show with my wonderful wife (as always), my amazing niece and a cousin from Israel. My cousin very much enjoyed the show, but I couldn’t convey the significance of this car.

 

This is a beautiful 1955 Buick Roadmaster. As I have written before I have an affinity for mid-1950s Buicks as the first car I ever drove was a 1956 Buick Century that my father owned for more than 20 years. By the way, after a period of cloudy, rainy weather that seemingly lasted for weeks we were fortunate to have a beautiful day for the show. It is raining again today. Enjoy the good moments and Carpe Diem!

 

OK, this is the obligatory photo of a C2 Corvette. I don’t know if my restomod is going to be a 1964 model like this one (I would prefer a 1967, all other things being equal), but if mine looks like this when it’s complete I’ll be very happy. I also have no idea when my car will be complete as I have not signed any paperwork, official or otherwise, with any company to have my restomod built. Still, people keep saying to “Think Positive” and that if a person writes down a goal it is more likely to be fulfilled.

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Do you know who Ed Cole was? He was born on this day in 1909. He was an important person in the history of General Motors and in the history of the American automobile industry, in general. (How about that juxtaposition in word use?!)

Cole was promoted to Chief Engineer of Chevrolet in 1952. He was in charge of the development of the legendary small-block Chevrolet V-8 engine, of which more than 100,000,000 were produced from the 1955 model year into the early 21st century. Cole and Zora Arkus-Duntov rejuvenated the Corvette and sent the car on its way to becoming automotive royalty.

For better or for worse, the Corvair was Ed Cole’s baby. I discussed the Corvair in this recent post. Like I wrote, for better or for worse. Cole became President of GM in 1967 and in that role oversaw the transition to unleaded gasoline.

Sadly, Cole died while piloting his private plane just three years after retiring from General Motors. I think his birthday is a very appropriate time to remember him and his contributions.

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Would you be interested in listening to “podcasts” from me even if those podcasts were just me talking for 4-5 minutes? As always, I welcome feedback from you.

 

Froback Friday

Well, I missed Throwback Thursday so I created Froback Friday! In honor of the large annual car show staged by a local museum that will take place on Sunday the 16th, here are some classic cars:

See the source image

From 1freewallpapers.com a picture of a beautiful 1933 Duesenberg. Even though the original Duesenberg company made its last car over 80 years ago, their creations—with help from the coachbuilders—are still revered today by many collectors and enthusiasts. At the recently concluded Mecum auction in Monterey, California, a 1933 Duesenberg Model J “Disappearing Top” convertible with coachwork by Bohman and Schwartz sold, all in, for $3.85 million. In the same auction a 1929 Model J with coachwork by Murphey sold for “only” $1.155 million all in. I don’t know if it was Duesenberg that inspired the expression “It’s A Duesy” but that wouldn’t be hard to believe.

On the other hand, even if I could afford one I don’t think I would buy a Duesenberg. As I have written here ad nauseam I own cars in order to drive them and, frankly, wouldn’t feel safe driving one of these. If I were to modernize a Duesenberg to make it safe then I would destroy its value. Let me amend my stance slightly: if I were REALLY rich, then I might buy one. By REALLY rich I mean a net worth in excess of $100 million.

See the source image

From classicnation.com a picture of a 1949 Cadillac Series 62. The 1949 Cadillacs were significant because, six years before the introduction of the famous small block Chevrolet V-8, Cadillac introduced a “modern” overhead valve V-8 engine. This article from Hemmings is an excellent history of the car/engine. From the article:

“The fact that the valves were now in the cylinder heads, actuated by pushrods, was really only one of the improvements incorporated into the design. The relocated valves also enabled the design of the new engine’s wedge-shaped combustion chambers, which would help the engine to take advantage of higher compression ratios, in turn enabled by the petroleum industry’s improvement in fuel quality…[T]he advancement of aviation engines–primarily for military aircraft during the war–mandated improved aviation fuels, and after the war these advancements began trickling down to enhance automotive fuels. Though the OHV’s initial 7.5:1 ratio was not a huge leap from the former L-head V-8’s 7.25:1, it was progressive; the engineers knew that even better fuels were on the way, and those wedge-shaped chambers would easily allow them to raise the engine’s compression further (12.0:1 was seen as feasible) in the coming years.

The big-bore/short-stroke configuration was a significant element of the design, as it allowed the engineers to reduce piston travel by nearly 20 percent, reducing internal friction. The shorter stroke also reduced the cylinder-wall area, helping to lower heat transfer and boosting thermal efficiency, in turn contributing to increased power output. Also developed as part of the new engine program were “slipper” pistons, which use a partial skirt to provide clearance for the crankshaft counterweights. This allowed for the use of shorter connecting rods, which reduced reciprocating mass and provided smoother operation.

The 3.81 x 3.625-inch bore/stroke relationship netted 331 cubic inches and developed 160 horsepower–the highest in the industry at the time. The larger-displacement 345-cu.in. L-head V-8 engine the OHV replaced made only 150hp and weighed nearly 200 pounds more.”

Recall from this post the belief that better fuels after World War II would allow automobile manufacturers to create engines with higher compression ratios that would, in turn, create more power from the same displacement. One of the reasons I am such an advocate of turbochargers for internal combustion engines is that they create more power from the same displacement and/or allow for good power from smaller displacement, which reduces fuel consumption. Turbochargers also reduce emissions and increase the thermal efficiency of the engine.

See the source image

From en.wheelsage.org a picture of a 1956 DeSoto Fireflite Sportsman hardtop coupe. My obsession with defunct American car companies is no secret (duh!) and this DeSoto just floats my boat. In 1956 a Fireflite convertible was the pace car for the Indianapolis 500; five years later, DeSoto was no more. The 1956 Fireflite was powered by a 330 cubic-inch hemi (yes, a street hemi in the 1950s) V-8 that produced 255 HP/350 LB-FT of torque.

I can’t wait for Sunday!

 

 

Wednesday Stories

Some 9/11 stories not intended to disrespect the memory of those who lost their lives and/or who were heroic in their actions:

– My amazing niece was under one of the World Trade Center buildings riding the subway just minutes before the first plane hit. I believe that people who refuse to acknowledge the huge role that luck plays in our lives are blind and/or stupid.

– My wonderful wife and I saw the Pentagon on Saturday, September 8, 2001. We were in Washington, DC as I was engaged in research on the book that received all of the accolades from the Wall Street Journal. I was supposed to go from DC to Canton, Ohio to the Pro Football Hall of Fame in order to do more research. According to the HOF website, they are only closed for Christmas, but access to the HOF library is by appointment only. However, when I tried to make an appointment for September 11-13 (I tried to make the appointment months before), I was informed that the library would be closed for an employee event. Therefore, I was home relatively safe and sound on September 11.

– The son of someone with whom I had worked while with the San Diego Padres was killed in the attacks. He worked for Cantor Fitzgerald in the World Trade Center.

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Whose car is this?

From corvetteblogger.com comes this story about the owner of a 1967 Corvette who went to court to prove that his car was authentic and that a Canadian car with the same VIN was a fraud. From the article:

“Robert Bonanno of Florida considers his vintage Corvette to be the authentic one and has been trying to make Saskatchewan Government Insurance give him the name and address of the owner of a Sting Ray registered with the same VIN in Saskatchewan.

Actually, the Saskatchewan Information and Privacy Commissioner told SGI in March 2017 that the name and address should be given to Bonanno, but the insurance company did not comply, citing privacy reasons under Canada’s The Freedom of Information and Protection of Privacy Act.

That non-compliance eventually forced attorney Bryan Shook of Shook Legal, which is representing Bonanno, to take the case to the Court of Queen’s Bench, which ruled Aug. 31 in Bonanno’s favor.

Bonanno found out about the duplicate VIN while showing his Corvette at a car show in Florida but believes the owner of the other Corvette doesn’t know his vehicle is a fraud.

‘We believe the present owner of the cloned vehicle … he or she is an innocent bystander,’ said Shook, a vintage car law specialist. ‘The car was created many years ago, probably 20 years ago.'”

Can you imagine that? <end slight sarcasm> Even the system designed to “guarantee” proof of ownership is not infallible. Neither human beings nor their institutions are perfect. I don’t know why people insist otherwise.

1967 Corvette Owner Goes to Court Over a Canadian Corvette with Identical VIN

From corvetteimages.com a stock photo of a 1967 Corvette.

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Long-time friend and Disaffected Musings reader Carl sent a link to this article featuring this car:

Picture from likeit.info…you might be able to recognize this as a 1972 Javelin AMX. This car has been HEAVILY modified by Ringbrothers, a famous car modification company. The engine is a Mopar Hellcat V-8 that has 707 HP stock, but Ringbrothers added a HUGE Whipple supercharger, which along with some other modifications gives the engine 1,036 HP.

Not to sound like I have a case of sour grapes, but where in America can you really use a car with that much power? This is more of an academic question than a judgmental one.

What do you think about this Ringbrothers car? If money were no object, what type of car would you have?

 

Monday Musings

Despite the fact that I worked in major league baseball for multiple teams for 20+ years, I no longer follow the sport at all. Why? Well, to be a little crude: baseball divorced me and I don’t give a s**t what my “ex-wife” is doing.

I have been a football fan for 50 years, but for many reasons I care less about the NFL right now than at any other time in a long time. I was born and raised in Baltimore, grew up as a die-hard Colts fan and was at the Colts complex that snowy night in March of 1984 when the team sneaked out of town. (That’s another story for another day.)

Paradoxically, I have also been a Packers fan since the early 1970s, probably 1972. The Colts and Packers were bitter conference rivals, but that rivalry predated my interest in football.

I was living in California when the Ravens were “born” and had season tickets for the first six seasons of their existence. As I have never lived in the home TV market of the Ravens (or the Packers) I have subscribed to NFL Sunday Ticket since 1998. Yesterday, the first Sunday of the 2018 NFL season, after the Ravens opened a 33-0 lead over the hapless Bills I didn’t watch any more football, but not necessarily by choice. It’s true I had no interest in any of the 4 PM games (and that was unthinkable five years ago), but I had intended to watch the Packers-Bears game.

My messed-up physiology had other ideas. Probably as a manifestation of my Meniere’s Disease, I developed a combination migraine headache/vertigo attack, took some meds and wound up asleep very early. So, I missed the Packers game and Aaron Rodgers’ heroics.

Former NFL quarterback Phil Simms has described Rodgers as, “The greatest thrower of the football in the history of the National Football League.” It’s impossible (unless you’re a Bears or Vikings fan) to really criticize Rodgers for any aspect of his play. Those more knowledgeable than I say that Rodgers has a tendency to eschew “sure” passes early in a play and that trait has positive and negative effects on the Packers.

Others criticize Rodgers for having won “only” one Super Bowl championship. Well, Trent Dilfer has more Super Bowl rings than Dan Marino. Does that make Dilfer a better quarterback? Championships are TEAM achievements, especially in football where so many players participate in every game.

The actual severity of Rodgers’ injury last night is known only by him and the Packers’ medical staff, but my tip of the hat to Aaron Rodgers for his remarkable second-half performance in the Packers’ win. Go Pack Go!

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How do I tie a car photo to the Packers? I wrote about Nash last week; Nash was based in Kenosha, Wisconsin. American Motors Corporation, formed when Nash and Hudson merged, continued to manufacture cars at Kenosha until its takeover by Chrysler in 1987. From barnfinds.com here is a picture of a 1964 Rambler American 440H manufactured by American Motors:

See the source image

That’s quite a handsome car, in my opinion. My fondness for the AMC Javelin is a matter of public record.

Sunday Sunday

I was going to call this post Sunday Silence and then not actually write a post. That would have been too “cute.”

Sunday was the only day my father didn’t work from 7 AM to 10 PM so we would often have dinner as a family and go for a drive either before or after dinner. I have fond memories of those Sundays, often spent in the back seat of the 1956 Buick Century that I have mentioned before.

I loved listening to the car radio, which I thought was an amazing bit of engineering. Surprisingly, it is not that easy to ascertain when the first car radio that found widespread use was actually developed. In History of the American Auto by Consumer Guide, one of their factoids for 1923 reads, “The first car radios available for factory installation are built by the Springfield Body Corporation.” An Internet search yields conflicting results.

This article from radiomuseum.org mentions the difficulty in determining when the first radios made specifically for cars were built and which company built them first. One of the sub-headings of the article is titled, “Confusion – no reliable statement of facts at this time.” From the same article (which was written in 2007), “The year and date for the first production run of a ‘real car radio’ remains still a bit of a mystery considering what’s known about the subject at this time.”

In case you don’t know (or even if you do), commercial radio broadcasts began in the US in 1920. KDKA in Pittsburgh was the first radio station to receive a “limited commercial” license although other stations had also been conducting experimental broadcasts.

Back to the radiomuseum.org article…a picture of a Crosley Roamio 91, a car radio from around 1930:

Don’t ask me how it worked because I don’t know and honestly don’t care. We take for granted the ability to have entertainment and information whenever we want in our car or anywhere else. It wasn’t that long ago that such access was not the norm.

OK, here’s another picture of a 1956 Buick Century, this one from momentcar.com:

See the source image

Once again, I am asking for “the sale.” If you like this blog, please tell your friends to read it and/or please post comments. I would very much like to read your thoughts.

https://disaffectedmusings.com

 

 

Saturday Selection

Besides the Mona Lisa, is The Starry Night by Van Gogh the most famous painting in history? I am not an art connoisseur by any means, but Van Gogh’s work speaks to me.

This kind of art speaks to me as well:

Sorry for all of the carpet in the photo. I bought this from the artist at Corvettes at Carlisle. If you can’t tell, it is a portrait of GTOs. I think all of them are 1966s and 1967s, but I could be mistaken as the smaller cars in the painting are more difficult to see. It is still in its wrapper as I don’t have a frame with the proper size. Maybe this week…

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From Hemmings a beautiful 1963 Pontiac Bonneville convertible for sale. The seller, a dealer, is asking about $49,000. According to the 2019 Collector Car Price Guide by Krause Publications, a concours quality, the best of the best, 1963 Bonneville convertible is worth $38,000. The Krause book is not right all of the time (for example, it lists the value of a BMW Z8 at no more than $41,000; good luck trying to buy one for $141,000), but if people are going to get into the world of car collecting they need to use an objective source of values in the process. I plan on taking the Krause guide to Scottsdale in January on the 1-in-100 chance I decide to buy something.

Of course, restomods and custom cars are not listed in the Krause book. As a very general rule, restomods usually sell for about half of the cost of the build once the original owner/builder decides to sell. A restomod build is not an investment in the traditional sense, but it is an investment in the enjoyment of life. How much is that worth? Monetary cost is often only a very crude approximation of value.

By the way, do you care if the photos are centered in a blog post? I don’t care, but I would like to know if you have an opinion.

 

 

Crypto Crash

The title of this post is not a prediction; it’s a statement. This CNBC article was very interesting to me. Here are the bullet points at the beginning of the article:

  • The entire crypto market has lost roughly 65 percent of its value as of Thursday but some coins have fared worse than others.
  • CNBC compiled a list of what a $1,000 at the peak of the crypto hype would have yielded in some of the most popular cryptocurrencies.
  • XRP has been the worst bet, down 92 percent since its high in January.

The “main” cryptocurrency, Bitcoin, is down 65 percent compared to its peak. If you had purchased $1,000 of Bitcoin at its peak, your “investment” would be worth $350 as of yesterday.

Could these “currencies” see a resurgence in value in the future? Of course, but that doesn’t mean they have intrinsic value and that doesn’t mean they won’t have another bust (or implosion) later.

I have a graduate degree in Economics, I held FINRA licenses for five years and I have had success in investing with the family portfolio. The interest in cryptocurrency is a mystery to me. It’s like a group of people have decided to unilaterally change the rules without any basis.

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A picture of a peaceful sunrise for, hopefully, a peaceful day. I took this during one of my many early morning excursions to get breakfast at my local Dunkin Donuts.

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I just can’t get this car out of my head:

Used 2007 Saturn Sky in Media, PA - 492829535 - 2

From autotrader.com a picture of a 2007 Saturn Sky Red Line, which means it has the turbocharged 2.0-liter (122 cubic inches, have to keep Bill Stephens happy; I wonder what the odds are that he will ever read this blog?) 4-cylinder engine that produced 260 HP. My brain is so messed up with all of the cars that I would like to own. I mean just yesterday I visited a “local” Corvette restomod shop for an hour and was graciously shown the entire place. This establishment has been in business for 30 years and they will do everything a customer wants from A to Z including finding a donor car. So why am I thinking about a Saturn Sky Red Line? I guess that’s the definition of OCD.

Anyway, the seller (a dealer) is asking about $11,500 for the Red Line. These cars were produced in such small quantities (only about 34,000 in total and that’s all Skys and not just the Red Line) that I believe value is difficult to ascertain. No, I am not going to buy a Saturn Sky, but it sure sounds good.

What cars do you think about? Once again, I am asking for comments and/or constructive criticism. I am too old to do all of the work. 🙂

Throwback Thursday

My wonderful wife and I watch A LOT of episodes of American Pickers. We are under no allusions that the show is a 100% accurate portrayal of how Mike Wolfe and Frank Fritz “do their job.” (We know, for example, that Frank Fritz doesn’t really work for Antique Archaeology.) We strongly suspect that none (or almost none) of the picks are really not pre-arranged and the same for the “negotiations.” However, the vast array of items shown as well as the historical tidbits make the show interesting for us even after well over 200 episodes have been produced.

 

 

 

 

 

 

 

 

 

 

 

From curbsideclassic.com a picture of the Nash Airflyte that sits outside of the Antique Archaeology shop in LeClaire, Iowa. It is a 1950 Statesman Super.

Nash and Hudson merged in 1954 to create American Motors. However, Nash was founded in 1916 by former General Motors President Charles Nash who acquired the Thomas B. Jeffery Company that had manufactured automobiles since 1902. In the late 1930s, Nash created the heating and ventilation system that is still used in cars today. Nash also introduced seat belts (in 1950) and the first US built compact car (also in 1950). The Jeffery Company was also an innovator producing the first reliable four-wheel drive truck (the Jeffery Quad) in 1913 that Nash kept producing until 1928.

As I have written many times (so many that regular readers are no doubt tired of reading it), fewer companies manufacturing cars means fewer sources of innovation for styling and for engineering. In my opinion, it is not just dry history to remember these defunct companies.

See the source image

Another picture from curbsideclassic.com shows a 1950 Nash Ambassador in much better condition than the car parked outside of Antique Archaeology. Apparently, George Mason, President of Nash-Kelvinator (Nash and Kelvinator Appliance Company merged in 1937) from just after the merger with Kelvinator (Mason had been with Kelvinator) to just after the merger with Hudson, had a thing for those front fender skirts. I can’t imagine they made for a good turning radius.

Mason strongly believed that the major independent automobile manufacturers would have to merge into one company in order to survive. The Nash-Hudson merger was, according to many automotive historians, the prelude to a merger that would have combined those two companies with Studebaker and Packard, who also merged in 1954. George Mason died not long after the creation of American Motors. His successor, George Romney (Mitt Romney’s father), had other ideas especially since he and Studebaker-Packard head James Nance did not get along at all. Destiny is overrated; if George Mason had lived to consummate the “grand” merger, who knows what the US auto industry would look like today?