Watch the Great American Eclipse of 2017 from a light airplane?

North Americans will enjoy a total eclipse on August 21 (will my Facebook friends blame this one on Trump?).

Supposedly hotels along the route are fully booked already.

What’s wrong with this idea…

  • reserve an air-conditioned Cirrus SR22 from East Coast Aero Club (the plane is fast enough to get anywhere in the Continental U.S. within one long day of flying; A/C will help with the fact that the eclipse arrives during a summer afternoon)
  • watch the weather forecast a few days in advance and plan to fly to a location that is forecast to be free of clouds, thunderstorms, etc.
  • land the night before at an airport about 100 miles away from the centerline (should be easy to find a hotel; 100 statute miles takes about 40 minutes to cover in an SR22)
  • fly at about 6000′ into the eclipse centerline with autopilot engaged
  • watch eclipse from the reasonably panoramic windows
  • twist autopilot knob to return to Bedford, Massachusetts

?

Nashville seems to be about the closest point along the route of the eclipse. It is 800 nm from our home airport. That’s about 5 hours of flight time in an SR22, depending on the winds. So if Nashville were clear the above could all be done in one moderately brutal day (maybe stop in scenic Pittsburgh on the way back?).

[Of course nothing beats flying commercial. JetBlue departs Boston at 7:40 am to land at BNA at 9:23 and then returns at 6:30 pm for $533 per-person round-trip. On the third hand, a reservation to Nashville won’t be of much use if the weather turns out to be cloudy on August 21.]

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Paris agreement debacle shows that we don’t need the Great Father in Washington as much as we thought?

The Great Father in Washington has withdrawn from the Paris agreement. Investors are so terrified about the Earth turning into Venus that the S&P 500 is up 1.75 percent in the last month.

For those of us who advocate for a smaller and/or more decentralized U.S. government, I wonder if this embarrassing spectacle has a silver lining. “Bucking Trump, These Cities, States and Companies Commit to Paris Accord” (nytimes):

Representatives of American cities, states and companies are preparing to submit a plan to the United Nations pledging to meet the United States’ greenhouse gas emissions targets under the Paris climate accord, despite President Trump’s decision to withdraw from the agreement.

A lot of cities and nearly all of our states have a larger population than the world’s median-sized country (about 5.5 million). Most have lavishly funded governments (sometimes so lavish that they need to declare bankruptcy!). It now transpires that they don’t need the Great Father in Washington to make a diet pledge on their behalf. (In retrospect perhaps this should have been obvious. If Denmark and Greece can independently set their CO2 output, why not Indiana and Florida?

Readers: Could this reverse some of the trend toward Americans looking to the federal government to solve all of their problems? Could it actually be more effective in reducing CO2 emissions? (People are more likely to comply with a pledge made locally with their neighbors rather than one made by a politician thousands of miles away?)

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Short Shake Shack?

Shake Shack in Harvard Square hasn’t been adapting well to the higher Massachusetts minimum wage, which was $8/hour when they opened in 2014 and is now 37.5 percent higher ($11/hour as of January 1, 2017).

First they cut their late-night hours.

On Saturday night we went there with another family. The trash can next to the front door was overflowing. The line was long (positive sign for investors) but there were a lot of empty tables, suggesting that the long line was more about slow service than high volume. (It took about 20 minutes for them to make our “fast food”.) My friend took her daughter to the bathroom and reported no toilet paper in any of three stalls plus a “disgusting” overflowing trash can. Another mom commented “You would never see anything like this at McDonald’s.” The handful of workers that were in the restaurant were charging pretty hard to keep up. The inability to empty trash cans or service restrooms seemed to be due to a lack of sufficient staff. (And in fact, it would be economically irrational for anyone in Massachusetts to work for less than about $24/hour (2013 data; see Table 3) if there were a way to collect welfare instead.)

As minimum wage trends up to $15/hour and labor force participation consequently trends down toward Puerto Rican levels, is a business like Shake Shack especially vulnerable? Their business is more labor-intensive than McDonald’s. They operate on a smaller scale so they can’t invest in robots as efficiently as McDonald’s can. They can’t raise prices too much before people notice that actually the fries are a lot better at McDonald’s.

I was impressed with Shake Shack as a business (see my 2015 posting), but now I think that I didn’t appreciate how vulnerable they were to higher labor costs. I guess the market is smarter than I am because the stock has done poorly compared to the S&P 500. The gross and operating margins don’t seem to follow any pattern from year to year, but the major push for higher minimum wages is fairly recent.

Readers: What do you think? Is this one headed to zero?

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Is the market being rational regarding wages for women?

Back in 2010, in “MIT failing to meet its race-based hiring quotas“, I wrote the following:

If a professor of a particular sex or race has more value to the school, why shouldn’t he or she be paid more than a white or Asian male?

Companies express unhappiness about the number of female executives on staff. Why don’t they just offer higher salaries to attract and retain women? The Wall Street Journal suggests that this may in fact be happening. From “Though Outnumbered, Female CEOs Earn More Than Male Chiefs”:

… female chief executives at some of the largest U.S. companies repeatedly outearn their male counterparts. Last year, 21 female CEOs received a median compensation package of $13.8 million, compared with the $11.6 million median for 382 male chiefs, according to a Wall Street Journal analysis of S&P 500 leaders who held the job a full year. Women in the corner offices of the biggest U.S. firms made more money than men in six of the last seven years…

Three out of 10 of the highest-paid CEOs are women, two at tech companies (Meg Whitman at HP; Ginni Rometty at IBM).

The option packages are kind of interesting. Ginni Rometty has 10-year options where some are at a strike price of 25 percent above the current IBM stock price. Assuming that IBM’s stock price remains constant, in real dollars, she gets nothing from these options in a static or deflationary environment. If there is a lot of inflation, however, her options will be worth a fortune. (See also the “Profits from Marriage and Child Support Depend Heavily on Inflation Rates” section within the Quirks chapter.)

Readers: What do you think? Does the higher pay of a sought-after category of worker show that the market is working? Or does the higher pay simply reflect that particular women are doing an awesome job (see HP and IBM versus the S&P 500 during Whitman’s and Rometty’s terms as CEO)? Or in a world where salaries are set by golfing buddies on the Board, is it nonsensical to talk about market pay?

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Is it time to invest in Greece? (not the bonds, though)

“Greek debt rallies to 2014 highs after key budget target hits 4.2% surplus” (Financial Times) says “Greece’s primary budget surplus – which measures the country’s public finances when excluding debt repayments – hit 4.2 per cent last year, swinging dramatically from a deficit and far outperforming a creditor target of 0.5 per cent for 2016.”

So the Greeks are actually spending a little less than they collect in taxes? And the creditors are demanding that they keep this up? But if they keep this up they will never need to borrow again, right? So why wouldn’t they default on the old debt and just keep the surplus for themselves?

What do folks think? Is it time to invest in Greek assets (other than the bonds on which it would seem to make sense for them to default)?

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Why is Trump bothering to withdraw from (or even mention) the Paris climate deal?

According to my Facebook friends, the world is ending yet again. A few months ago it was Jew-hatred, inspired by the Trumpenfuhrer (see “Donald Trump is threatening Jews?“) and manifested as phone calls to Jewish schools and community centers. Now that the perpetrators turn out to have been an Israeli Jew with an autodialer and an anti-Trump journalist here in the U.S., my friends have been posting like crazy about the dire planet-melting consequences of an American withdrawal from the Paris climate agreement. Here are some samples of their posts and shared posts:

As a parent, as a global citizen, as a human being, as a life form sharing this planet, I cannot fully describe how upset I will be if our ignorance-pandering President does what he is apparently likely to do and exits the most promising global compact of any sort in recent years.

Ugh. Ashamed of my country that made such blind idiocy possible.

Jackass. Pulling out: idiotic. Toying with it arrogantly, omnipotently, to keep the world in suspense: disgusting.

Be there if you can to protest should Trump make good on his reckless promise to pull the United States out of the Paris climate accord. The rest of the world is aghast. This is no longer just about us or about stupid Trump voters — this decision affects the entire planet. [Regarding an Emergency Rally at the White House.]

I’m embarrassed to admit that, though perhaps I once did know what this agreement was (and in 2015 even asked about it here, with Dumb climate change agreement question: how is it different than a diet pledge?), I’d completely forgotten about it until this Facebook frenzy. I’m trying to reeducate myself on what friends tell me (shout at me, actually) is an item of cataclysmic importance to the planet’s future. So far I’ve read “Q. & A.: The Paris Climate Accord” (nytimes):

Unlike its predecessor treaty, the Kyoto Protocol, the Paris deal was intended to be nonbinding, so that countries could tailor their climate plans to their domestic situations and alter them as circumstances changed. There are no penalties for falling short of declared targets. The hope was that, through peer pressure and diplomacy, these policies would be strengthened over time.

So this is like my daily visits to the gym that I conduct annually? And my strict all-organic steamed vegetable diet that I alter as circumstances change, e.g., when bacon is available?

While the current pledges would not prevent global temperatures from rising more than 2 degrees Celsius above preindustrial levels, the threshold deemed unacceptably risky, there is some evidence that the Paris deal’s “soft diplomacy” is nudging countries toward greater action.

Countries are sending each other positive vibes?

Because the deal is nonbinding, there are no penalties if the United States pulls out.

Now I’m more confused that ever. If I go to the Big Texan with friends and chow down on a 72 oz. steak (never beat Molly Schuyler, though, sadly), how would they knew whether or not I am still officially adhering to my steamed vegetable diet?

This agreement seems hardly more than an excuse for a lot of highly paid bureaucrats to gather periodically in beautiful resorts at their respective taxpayers’ expense. (Was it ever approved by Congress, the way that a treaty would be? Is the agreement reflected in any U.S. laws?) So the only arguments that I could see for withdrawing are to save money and to save the planet by keeping these folks from flying around to meetings. But here in the U.S. the government spends $4 trillion per year. Cutting expenses at this level is not a Presidential matter.

So why would Donald Trump even bother to mention this nonbinding penalty-free agreement to make, essentially, New Year’s resolutions? And why do my friends think it makes a difference? If they’re interested in keeping up with things that might affect atmospheric CO2, why wouldn’t they be looking more at solar cell production and innovation, windmill design and installations, etc.?

 

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