09:55 – Wow. The EU crisis meeting this weekend degenerated even faster than I expected, with Merkel and Sarkozy literally screaming at each other, so loudly that it was audible over Ode to Joy down the hall in the main conference area. The problem, stated simply, is that Merkel and Sarkozy hate each others guts. Were it not for the critical nature of these meetings, they wouldn’t agree even to be in the same room. Sarkozy wants Germany, directly and indirectly, to pay essentially all of the costs of “rescuing” the euro. Merkel knows that Germany couldn’t afford to do that even if it wanted to, which it doesn’t.
The only significant thing to come out of the conference so far is a preliminary agreement to recapitalize EU banks to the tune of about $135 billion. That’s half of what the IMF said would be necessary, and even the IMF figure is based on rosy assumptions. And, if the last few months is any guide, rosy assumptions are highly unrealistic. My own opinion is that $1 trillion would be just a start on what’s needed.
Meanwhile, we’re in the middle of a huge run on EU banks. Individuals and corporations are withdrawing funds from all EU banks and moving them to perceived safety, often literally under their mattresses. No one–individuals, corporations, or governments–trusts EU banks any longer, and with good reason.
The level of writedowns that banks will be obligated to accept on Greek debt is a huge sticking point. The IMF and Germany are pushing for 50% to 60%, which is itself grossly insufficient. France, whose banks are hugely exposed to Greek debt, is insisting on no more than 35% to 40%. The bankers themselves, via the IIF, are saying that if the 21% “haircut” agreed at the 21 July summit must be increased it can be to no more than 25% to 30%. It’s gotten so bad that the EU authorities are now playing chicken, telling the bankers that if they don’t cooperate the EU is now willing to allow Greece to go into hard default, which means 100% haircuts.
There was never any realistic possibility that this summit would agree to any actions that had any chance of “solving” the crisis, but now it’s clear that nothing of any significance whatsoever can be agreed. It’s now as close to mathematically certain as politics can ever be that the euro will break up catastrophically, and it will be sooner rather than later. I’d bet good money that Germany is preparing, if not already fully prepared, to depart the euro and re-institute the D-mark under whatever name. Finland, Austria, and the Netherlands are probably planning to do the same, either with individual local currencies or as a part of a Northern-tier currency union.
What we’re watching is not just the collapse of the euro or even the breakup of the EU, but the destruction of the whole European welfare state.
“Merkel and Sarkozy literally screaming at each other”
Wow, even I learned in a Dale Carnegie course a number of years ago that arguing and shouting never resulted in agreement.
When a German leader engages in a shouting match with a French leader and neither one’s army gets mobilized, that’s progress. 🙁
I am just now seeing Jim’s request about logging water temp. I am afraid if I responded back to that day’s post, it might not be seen, so I am putting it here.
Temperature logging devices are really hard to find at the retail level. They exist in custom embedded manufactured situations all over the place, but not as stand-alone devices. Modern hot water boilers (both for heat and hot water) have water temperature sensors built into the water path. But just try to find such a sensor as a separate, individual unit.
We needed a sensor to take the room temperature of the radio project’s transmitter shack. After months of looking (this was a couple years ago), we had to buy something from Poland. We needed to be able to see the exact temperature at the present moment, and also have a record of what it had been doing over time. The device is not well documented in English, and it often just quits working. In that event, somebody has to go out to the shack (45 minute drive for the closest one of us) and unplug the damned thing and re-plug it to reset it (it is a USB thing-a-ma-bob). Even rebooting the computer does not fix it; it actually has to be unplugged and plugged back in, while the computer is on. Fortunately, there is another temperature indicator inside the transmitter, so that can tell us what is going on, when the room indicator is not functioning (transmitter temp is always about 25°F hotter than the room temp).
We have searched for a replacement, but there seems to be nothing on the market that will give a current reading, while also recording the historical temps. Stuff for sale on weather-bug sites universally look like USB flash drives, which require a computer set-up, pulling the unit from the computer, then putting the stick where it is to monitor the temp, then plugging it back into the computer later to download the historical data. In the first place, our need requires the temperature detector itself to be AWAY from heat-generating computers and equipment, and then it needs to be connected and reading at all times. Frustrating.
I remember a friend from years ago, who had his own commercial espresso maker. He had a gizmo that plugged into nozzle of the unit and had a thermistor in the water path that then lead to a temperature-reading device that told him exactly what the water temperature for brewing was (he claimed 200°F was perfection). I think this thing is similar to what he had.
http://www.home-barista.com/reviews/scace-thermofilter-temperature-device-instructions-t515.html
Seeing how it is constructed, I think you could make a project out of putting a temperature probe like this one into one of those screw-on aerator devices at the end of the faucet. That may be more work than you want to tackle–not the least of which is what do you connect the thermistor to, in order to do the reading and recording?
Anyway, just a thought.
Thank you, Chuck. Good mashup of ideas and might compel me to devise something on my own. Been years since I studied electronics, but I have tinkered with espresso machines, so it’s a great lead for parts and ideas.
What ticks me off is that they spent probably 6 figures replacing the 50 yo boilers a couple years ago and the hot water cuts out regularly. You’d think the engineering firm would have some pride in his work, or that the super (or even owner) would tell them in no uncertain terms that such a result is unacceptable — but no. I’d go off on a rant about Seattle, but don’t think it would contribute much to the general discussion.
Chuck, see this post for a data logger. Looks like a great combination with your espresso machine parts! Also a digression on thermoeter readings.
http://www.ttgnet.com/journal/?p=245#comment-2205
Wow–it’s a new system? That IS inexcusable. Most apartment complexes have a circulating system so water is hot instantly when the tap is turned on. There are a lot of not-so-obvious engineering factors involved in that. It may be that some apartments have hot water, while it is colder in others.
http://www.savegas.com/PagesPublic/BTOM01_09.aspx
It may be that the circulating system is not designed/functioning properly.
I’ve see some of the blueprints and it worked fine, if somewhat inefficiently, since it was built in 1956. Since the rebuild, however… the feedback system has errors.
The radiant heating, fed off the same boilers, is wonderful! Takes a week to bring it up to speed and heat a thousand tons of concrete over eight floors. All recirculating, all worked well until the boilers got replaced.
It’s inexcusable that a new boiler system would need a manual reset though. I’m aware of the “not so obvious problems”, but that’s no excuse for an engineer who takes pride in his work. Especially with this building — it’s a beauty, and a rebuild one would be happy to include in a resume.
That’s what I hope to demonstrate with my thermograph. Maybe I can shame them into submission?
Regarding Europe: I am less pessimistic than our host. At the same time, I find it astounding that the political and financial leadership in Europe has spent months denying the basic issues that have been obvious to everyone for months, if not years. Greek debt will have to be written off? What a (non-)surprise! At least they *are* finally admitting it – better late than never.
The European welfare state is not nearly so uniform as one thinks. It’s a fair enough question to ask: are you willing to pay for these social services? In Germany, and most Northern European countries, the answer is “yes” and a whoppingly high tax rate – and most people are fine with the situation. Viewed in isolation, these countries are doing fine.
Their mistake was to assume that other countries would be equally rational. In countries like Greece or France, on the other hand, people demand the services, while being unwilling to pay for them.
There will be a serious collapse in Greece, Italy, Portugal – possibly also Spain and France. However, I am pretty sure that Germany, Austria, Holland, and countries farther north – these countries will learn a sharp lesson in the short-term, and continue to do just fine in the long-term.
Oops, I quoted Brad’s post but didn’t add my questions:
Do you think the Euro will survive? Do you think the countries with the serious collapses will include failures of banks in those countries? Do you think Germany’s sharp lesson will include failures of one or more German banks, or will the sharp lesson only include having to bail out German banks?
Only a wild guess, but I expect something called,”euro” will surbive, but the participants and conditions will be different. It’s also likely that some countries will no longer be in the EU.
Germany’s pain will likely be restricted to bailing out the banks – this despite the government’s best efforts to bankrupt the country by throwing money at the rest of Europe.
If the situation weren’t so serious, it would make great comedy – a parody showing how, *not* to govern.
I am even more optimistic than Brad. The real lessons were learned in this fiasco a couple of years ago: allowing countries to be exempted from adhering to the EU economic guidelines just cannot be permitted for anyone; and accounting by individual countries cannot be trusted. It is too bad that Keynesian debt is making this a lot tougher than it needed to be.
Anybody who chooses to leave the Euro will fall on razor wire. They will be economically obliterated.
Maybe, just maybe a coalition of ‘leavers’ might work–splitting into FANG and LOSERS. But anybody trying to go it alone will quickly retreat to the Dark Ages. The people who count know this. Even if the electorate somewhere tries to override, they will have a very difficult time doing so. In fact, even if candidates promising to leave the EU win, I think they will be unable to accomplish the deed.
Those of you who think nationalism is possible in the New Era will see that–even if it is tried–it will fail miserably. The machinations going on within Europe now, are akin to WWI–when their society got rid of the kings,–and WWII–when they later had to get rid of the dictators that imposed themselves in place of the kings. The strife now is nationalism succumbing to federalism. It WILL happen. There is no way through to the future except to do away with it–just as there was no safe future until the kings were removed, and then the dictators.
Be glad! The American experiment showed the way. Let it happen. Globalization is pushing a better way on everyone. Governments MUST compete against each other.
And I agree with Brad: this is not at all the death of the welfare state we are watching.
@Chuck: Random question – did you live in Dayton around 1982-1985?
Nope. My progression has been born in New Castle, IN, grew up in Indianapolis; worked there until late ’70’s; St. Paul, MN to early ’80’s; Chicago to late ’80’s; Boston to early 2000’s; Berlin Zehlendorf, then Berlin Strausberg; and back to the original Tiny Town to sell my folks’ retirement house in late 2000’s. Unfortunately, 5 years on the market (just a month before the bubble burst) has not resulted in a sale. Dayton is close to Tiny Town, though.