Home Sweet Home

Back in America. This video seems apropos with World Cup coming up (not for kids).

Hash

Some of my friends took me on a hash about a month ago, but I just got around to getting the pictures off my phone. A hash was a originally a run through the desert, and while a handful of people on our route still ran (different trail), for most people it's more like a hike. Ours was pretty fun as it was out at a desert rock formation, so we got to climb up, around, and down them. Hashing is a western phenomenon and gives people in country a chance to meet each other.

Here are my softball buddies that took me.



This is at the beginning, looking toward where we're going. The group was large, but they are mostly behind me in this shot.



This is looking down from where we just climbed up to the end part of the group. They are in the process of snaking up the same trail I just went up.



The view from the top.



Overall, very fun!

Jeddah - Red Sea

You guys need to see pictures of me snorkeling in the red sea! I got baked, but it was a blast.



Next I like,




And finally, because I was snorkeling and not diving, some of the money shots:



I enjoyed the Red Sea. Those are my very limited snorkeling pics, but it was quite an adventure.

Pfew!

Sometimes I'm not that organized, add to that my uncle dying and I flat out screwed up. Over the last three months I had racked up 3 different late fees on the 2 of the four credit cards that I have.

Don't do what I did and let your payments slip away from you. I remember checking on the accounts, but somehow screwing up.

BUT MOST IMPORTANTLY, remember that your credit card accounts are very negotiable. The credit card companies spend $300 to $500 just to get your business, so don't give up too easily. I wracked up $117 in late fees over the last two months. That's two to a citibank account and one to an american express account. In the American express case, I went through a rep. who couldn't help me, because I had already incurred a late fee six or seven months ago. The supervisor was happy to help me though.

In the second case, with citicard, I almost went straight to an account exec., and they were happy to waive two late fees to keep me. In the end, they'd much rather keep you than get new business, and if you're like me, you'd much rather stay than find a new card, so try to work something out and remember that you have plenty of power in the transaction.

I saved $117 in less that 20 minutes. Look, it wasn't a great spot to put myself in. And I did thank both these companies for their willingness to work with customers, but paying off late fees is not something you should consider standard fare. If you are a good customer, defend your status and work from there.

Saudi Photos

Not much to say. Going to Jeddah this weekend and hope to have fun stories when I come back. Here are some photos a friend of mine took. Photos are moderately taboo here. They don't want you taking photos of cool buildings for terrorism fears, and it's sort of immodest to take pictures of Saudis you don't know. But my friend is braver than I, and a better photographer.

The two types of traditional Saudi male garb, the white headress and the checkered red:



All dressed up with no place to go. Saudi women have to cover everything, but their eyes. Other Arab women can get away with the black abaya (cloak covering their bodies) and a wrap around their hair. And western women can usually get away with just the abaya.



Austerity:



Always and everywhere, kids are adorable.

Phone Number Dictation

One of the interesting things about traveling are the little cultural differences.

In America, we dictate a number with a certain cadence: XXX-XXX-XXXX

In Saudi it's, XXX-XX-XX-XXX

Internship

Haven't blogged about it yet, but I've got a great internship here with an investment bank called ICT Global. The company has raised capital and has prospective clients, but they are still going through the process of getting the proper licenses from the Saudi government. I'm learning a lot about valuation in emerging markets, and hopefully bolstering my skill set with some practical finance knowledge. Here's the text I've been using.

Dir'iyyah

A few days ago, Mark and Debbie (my friends and neighbors) took me to "Old Riyadh" also known as Al-Dirah. The town was founded in 1446, but reached its peak in the 18th century, until the Ottoman Empire sacked the city in 1818.

I got some great pictures:




The city wall:




Here is a giant Saudi flag. They are creating a tourist spot here. Between the flag and me, there is a valley where tradition has that Mohammad ibn Abdul Wahhab is burried. Wahhab's created a very conservative sect of Sunni Islam that still has a great influence over Saudi Arabia today. Wahhabism is linked to both the Mutawwa (religious police) and terrorism. The relationship between Saudi Arabia and conservative Islam is complex. Abdul Aziz used the Wahhabi religious fighters (Ikhwan) to consolidate his power in Saudi Arabia (1920s). Later, when they revolted accusing him of religious laxity, he got permission from the religious council to slaughter them (1930). Abdul Aziz renamed the region Saudi Arabia and appointed himself King (1932). Saudi Arabia was still a backwater fighting wars on the backs of camels, then in 1938 oil was discovered and the country was changed forever.




Here is a great picture of Debbie and me. We are inside the city with the wall behind us.

Memories of Gene

A Wonderful Slide Show of Memories of Gene:

Here is Gene's obituary.

Oil Spill Theory

My previous post on the spill lead to a little bit of thinking about oil spills. The current law is a bit strange, and I'm not sure I really understand it. It sounds like this law limits the damages that can be attained in Federal court to $75 million and that includes removal costs, damages to both public and private property and resources, lost tax revenue, and lost profits. According to this, there is still unlimited liability in state courts. Can the U.S. government sue a company in a state court? Can the state government? My guess would be that the local businesses can still sue in state court, but the taxpayers would get screwed under current law. If anybody knows more, please comment.

What I want to focus on is the Oil Spill Liability Trust Fund. Basically, a 5 cent per barrel tax on oil was created and put in a fund to clean up future oil spills. The fund can provide $1 billion dollars for oil spill cleanup. So, what the government basically created was an insurance fund paid for by oil consumers to clean up oil spills. It's still funded by taxpayers, but not by the income, rather, by their consumption of oil. So in a sense, it's a good thing. The people that benefit the post from off-shore drilling (whoever they are) are buying insurance for taxpayers as a whole. The problem is that with insurance the incentive to be diligent goes down. The driller is no longer paying the cost of the clean up. Of course, the response should be oversight. Unfortunately, the regulator of this was completely corrupted. I encourage everyone to check out Rachel Maddow document the extent of this corruption that I happened to catch at breakfast.

One response is that we need better regulators, and to the extent that is feasible, there is no doubt that would help. Unfortunately, a critique of that is that the nature of government is to get compromised by industry. Economists often call this "rent seeking." So what is another possible answer? Well, we could mandate firms buy a billion dollars of insurance. Then we don't need to worry about the government to be the oversight, we can work through the market. Let Warren Buffett (or whoever) collect premiums and audit safety as the insurer has an incentive not to make large payouts. This really just pushes the problem one stage back though, because now we have to regulate the insurer to make sure they can actually provide insurance. Otherwise, I'd be happy to sell the insurance to oil companies collecting revenues for doing nothing and declaring bankruptcy if the big spill came.

What I find interesting is that this is the exact same predicament that we are going through with the financial reform bill the Democrats proposed. Basically, we are insuring the banks against future bailouts by collecting a tax on banking. In this case, the fallout of financial failure is equivalent to an oil spill. It takes out a lot of industries just chillin in the surrounding waters. It's not clear which model is better. The first one has worked for a long time with the FDIC and member banks and deposit insurance. But it also looks really bad when the regulators look really bad. The second model works well on a small scale. I have to buy insurance for the benefit of other drivers I might hit with my car, but it's unclear if it scales all the way up. If payoffs are large and rare, collecting premiums with no intent to be able to payoff if the big one comes looks more and more appealing.

Republican Corporatism

My political views are somewhat interesting compared to my peers. I tend to care more about freedom and economic growth than most of my peers, and yet, they are all Republicans and I increasingly despise the GOP.

Paul Krugman gives a good example of why:

"In the wake of last month’s catastrophic Gulf Coast oil spill, Sen. Lisa Murkowski blocked a bill that would have raised the maximum liability for oil companies after a spill from a paltry $75 million to $10 billion. The Republican lawmaker said the bill, introduced by Sen. Robert Menendez (D-NJ), would have unfairly hurt smaller oil companies by raising the costs of oil production. The legislation is “not where we need to be right now” she said."

The backbone of the free-market response to corporate irresponsibility is that they can be sued by people for damages they caused. In fact, with immunity from these suits or a cap on them, we should expect companies to cut corners and take on a lot of risk. The whole purpose of a firm is to maximize profits, and in a competitive market even if one firm leaves money on the table another will scoop it up.

The effect of any cap on damages at all is that after some point the federal government subsidizes oil spills. We are actually incentivizing oil spills. I haven't seen a more general Republican response to this, so maybe this is a rogue Senator from Alaska under all the pressure of Alaskan oil interests. I just did a search and here are some Republicans offering a bill that appears to greatly increase the liability cap, but I don't know the specifics.

The U.S. Budget

From Harvard economist Greg Mankiw's blog. It's a good picture, because it starts to get at why cutting the budget is so difficult. A lot of people think we just need to cut out "pork," but even the anti-pork watchdogs only estimate pork at .5% percent of the budget. So what else is in "Other spending"? A whole lot of it is in stuff people think government should do transportation, energy, treasury, health and human services...

The point is the budget doesn't look very good. And all cuts are painful. Twenty-nine percent of your taxes (actually much more, unless you have a high income) go to pay your grandparents social security and medicare. Fourteen percent goes to interest payments on debt your parents accrued. It's kind of funny to me that so large a proportion of the tea party movement is older people, who get socialized medicine and social insurance payments, when forty-three percent of the budget either goes straight to old people or to interest on debts they accrued by running deficits.

And don't forget old people vote like crazy (what else do they have to do), so most of these programs are untouchable.

Softball Champs!!!

In an amazing upset, the Scorpions went on an improbable run to win the softball champion. We were the 5th seed of 8 teams. In a double elimination tournament, we won the first game and got run-ruled by the one seed. We had to win a double header against two teams we had split with earlier in the season. Then, we had to beat the #1 seed twice, a team that had already run-ruled us three times previously. They had a 13 and 1 regular season record, compared to ours of 5 and 8. If you laid me 20 to 1 odds, before the first game, I don't think I'd have taken them. Somehow we beat them, though. We hit like crazy, made less mistakes in the field and came out on top. We won the first game 30 to 25 and run-ruled them the second game 25 to 10. I finally got a chance to breakout going 7 for 7 with three doubles and 4 singles in the championship. I hit the ball pretty well and also got some breaks I hadn't gotten earlier in the season, a hard ground ball got through and two texas leaguers landed safely.

I can't really describe how much fun it was to win. We were all pretty sore and exhausted playing four games in two days, and I kind of thought losing was inevitable even when we started the last game. When we finally pulled it out, I actually teared up. It was just amazing to work hard and win something. It's probably been 8 years, since I played in a meaningful sporting event. Lots of fans showed up for both teams, which really added to it all. Someone I've never even seen before came up to me after the game and said, "Charlie, I think you might be the MVP. You had seven hits and four doubles!" (he counted one that was really a single with an error). I didn't agree, but it was really fun that people noticed I'd had a good game.

All in all, it was a great season. I made a bunch of great friends and had a really great time. We even had a party and award ceremony the next day. Woot! Go Scorpions!

Green Jobs

There's always been a lot of confusion around climate change and green jobs, not least of which is propagated by the administration, but listening to some otherwise seemingly knowledgeable business people discuss it on multiple CNBC type shows, it's apparent that the confusion is not just politically motivated obfuscation.

There are two basic narratives that tend to get argued.

1. Climate change is a wonderful opportunity to create green jobs, and creating jobs spurs economic growth. Yay!

2. Climate change is a terrible, unbearable toxic drain on our economy that will cause higher taxes that will hurt the economy.

Both views have bits of truth and bits of confusion. The best way to think about climate change is analogous to a giant meteor hurdling towards the Earth. Many scientists expect the meteor is expected to hit the Earth in about 100 years. But there's lots of problems. The meteors far away, so it's not totally clear when it will actually hit the Earth or how much damage it will due. It's not clear we even know for certain it will hit us at all. What if we there are gravitational fields we don't know about that will save us or objects we don't know about that will change its course.

So, we decide to start preparing just in case, which is pretty reasonable if you think the probability is high enough or the worst case scenario is bad enough. We get scientists and engineers to try to create new meteor stopping technologies. We employ construction workers to build some of their designs. Jobs are created. But it should be obvious that the best case scenario would be not to have to ward off the meteor attack. We'd rather have those workers doing other things, I mean, otherwise we could just sign a treaty with China to have nukes fire at each other in 100 years and spend a bunch of money trying to figure out ways to stop them.

But it should be just as obvious that the second view is wrong. The meteor IS coming. The "meteor jobs" and taxes aren't a drain on the economy; the meteor is. I understand that if you think the meteor is a low probability event or won't be that bad, you won't want to spend much stopping it, but then your argument should be about the probability of the meteor hitting, not the cost of the taxes.

There's a final argument that says. I think the meteor is coming, but I just want to let the free market decide how to stop it. It's actually possible that would work, but it could also fail. People's best strategy is to donate as little as possible, but still have the meteor stopped. So inevitably less resources go into the project, it might still be enough, but it might not. I've heard people state this argument, but I've never heard them articulate why its a good trade-off to make.

This analysis leaves open all possible views for what we should do about climate change (or meteor attacks), but there are coherent arguments and incoherent arguments, let's argue better.

Science of Nutrition or lack thereof

I keep seeing stories about salt intake on the news. It appears to be traced back to an article, "Projected Effect of Dietary Salt Reductions on Future Cardiovascular Disease" published in the New England Journal of Medicine this year. Since reading Good Calories, Bad Calories, I've increasingly come to believe that the science of nutrition is mostly junk. A lot of what we believe to be true isn't actually supported by data. That doesn't necessarily mean it's false, we just don't know. A simple example is fat or more specifically saturated fat. The fat causes heart disease hypothesis was still being debated in the 60s. Seemingly a consensus was formed, then lots of money and time was spent proving the consensus correct, then the data came back inconclusive. By the time the data is in though, the consensus is already formed and no one seems to care about the data. It's easy to explain away even large and comprehensive studies, because the effects are very hard to measure and control.

I found an article about salt by the same author as above here. It talks about the last 30 years of the salt debate and how problematic the findings have been. It's hard to imagine the study above has fixed the problems, but I don't have access to the full text so I don't know. The study says that a reduction in salt would save hundreds of thousands of lives. Here is my guess at the quick and dirty problems with that:

The study is likely doing one of two things:

1. Assuming a relationship from other studies, ie. reducing salt lowers blood pressure X amount and extrapolating from that. Thus, I know salt leads to blood pressure and blood pressure leads to deaths, so I take what I know about blood pressure in the population reduce it and my model tells me how many lives I've saved. The problem is that I'm assuming salt leads to blood pressure, which is a claim that is hard to prove especially in controlled studies.

2. More likely though, I think they are using their database to estimate the effect of salt on either blood pressure and mortality. I just don't think they could get away with the previous option. The problem with this is adequately controlling for the people with heavy salt intakes. Suppose one group of people eat McDonald's every day. Well, McDonald's is bad for you and it's high in salt, but it's not clear the salt is what's bad for you. It could be fat, trans-fat, carbs, calories, lack of nutrients, who knows. It's not hard for me to believe that processed foods are bad for people, but it is hard to imagine a large panel data correcting for the salt in processed foods or something else.

Even if salt causes high blood pressure, which causes death, it's not clear lowering salt as a public policy would actually save any lives. Suppose processed foods and fast foods have to become less salty, the makers probably aren't adding salt just for the hell of it, the foods will probably become less tasty. So what will the manufacturers do? Will they add more fat or more sugar? It's possible the foods actually become less healthy. Increasingly I'm becoming convinced that this is what happened during the "fat is bad" 70s until now. Although, I'm not sure I'm right; it's at least defensible that the push to encourage Americans to eat less fat was actually counter-productive.

I think it's actually very useful to infer what will be in studies before reading them. I will probably never follow nutrition closely enough to have a fully informed opinion. It's quite possible that this study actually has new and informative information that actually helps settle the long debate. If that is in fact the case, I need to make sure to take future big news story studies more seriously and trust the ability of the establishment to find the truth a bit more over time. If the study adds nothing new, and just repeats old mistakes, it's further evidence that nutrition is junk science. What I don't want to do, is read such studies and use whatever it says to confirm my biases. All studies have problems, so it's easy to slightly alter your hypothesis or to undermine the study, so that it seems to work in your favor.

The reason all this hits close to home is that Economics suffers from many of the same problems Nutrition does. We make inferences about complex systems with lots of theory and little data. We have lots of trouble controlling for certain effects, and have very few useful controlled experiments. All of this is worst in my field, macro. When I hold macro to the same standards I hold nutrition, it's very hard to articulate what I "know" about macro.

Update: I still haven't found the full-text of the article, but I found some slides by the first author. There are two studies cited on the slides. One is just another meta-study attacking two other meta-studies. The second, though, is more intriguing, and the full text is available. It's a somewhat controlled experiment of 412 people on both a healthy and normal diet. The study had people on both diets consume high, medium and low diets and the study shows some reduction in blood pressure. What's weird is people on healthy diets didn't get much benefit than people on the control diet. Why should that be? The study doesn't say how salt was added to the diet either, which could be important. But if the second study is robust and replicable, I'm down.

Another interesting thing from the slides is that several countries are already launching into anti-salt campaigns. The U.K., for instance, has been successful in decreasing salt over 10 years, but it didn't say, if people were dying of heart disease and stroke less than before.

LTC. Tim Platt

Lt. Colonel Tim Platt definitely deserves his own post as he received the Legion of Merit decoration today for "exceptionally meritorious conduct in the performance of outstanding services and achievements." Tim pointed out the award sounds eerily similar to Homer Simpson's award "for outstanding achievement in the field of excellence." (sidenote: Tim grew up with Simpsons creator Matt Groening, who was president of his their high school when Tim was a freshman and Matt a senior). Tim's had an amazing 30 year career that included a lot of combat in Iraq, where he lead Iraqi Army troops. He's got some great stories about the trials and tribulations of the efforts there.

Tim is officially retiring May 14th, but he's been nice enough to open his home to me when I am not at Yamama. He and Gene had a regular weekly dinner, and he's been a great friend to my aunt and my uncle. And in the short time I've known him, he's also become a great friend of mine.

When it rains...

It more or less shuts down the city, if it rains hard enough. We had one day of hard rain today, and my good buddy Tim Platt got stuck in downtown. A drive that should have taken him 30 to 45 minutes in traffic took 5 and a half hours. There is very little drainage, and especially in the low downtown areas, the flooding can be very bad.

Mankiw on the VAT

Greg Mankiw, Harvard economist and CEA Chairman under Bush, has a very good and neutral article on the Value Added Tax. In theory, many of the major tax changes that you hear about are actually all the same, but they vary in execution and compliance. For instance, Huckabee's consumption tax and Steve Forbes' flat tax are essentially the same. Under Huckabee's system, we would use tax free money to buy more expensive taxed products. Under Forbes' our wages are taxed, but the products we buy aren't. In both tax systems, savings aren't taxed. As Mankiw, explained in the article, a VAT is just a consumption tax that is spread out along the value chain.

So, how is "in theory" different than in reality:
1. Compliance - One key way is policing the compliance of those in the tax system. For instance, a large sales tax encourages black markets more than a VAT. In the former, there is a buyer and a seller that have a lot to gain by avoiding the tax and splitting the gains. In a VAT, the gain is small from avoiding tax and spread over every part of the value chain. Think of a car, who is more likely to cut an off-books deal, you and your shady dealer or you and every producer of every part in that car.

2. Change-over - The often overlooked by commentators part to this equation is that economists often show equivalence as if two systems were already in place and would remain in place. Imagine changing from our system to a Huckabee system. If your want of my contemporaries, it probably sounds fine, but if you are one of my parents', it probably doesn't. Let's say you turned 65 and retired the day the change took place. Over your whole career, your labor was taxed, and now that you are living off your savings, your labor is being taxed again! this time by taxing your future consumption. I never heard it mentioned, but Huckabee's plan was a huge one-time tax increase on older people.

3. Affect on Size of Gov't - This seems to be one of the most contentious parts of tax debates and also the part that has the least and most ambiguous evidence. Some argue that when people don't see a tax directly like the VAT, they don't fight against them as hard, so government gets bigger. In reality, government growth appears pretty unrelated to the way taxes are collected.

One final point: These tax plans are generally identified with Republicans, but as a moderate lefty, it's still quite easy for me to find an acceptable version. For a consumption or VAT tax, you'd just have a standard deduction that everyone would get back. The tax rate compared to the deduction determines how progressive the tax is. If the standard deduction is 0, and the tax rate was 20%, it wouldn't be progressive at all. If the standard deduction was $5,000 and the rate was 30%, the very poor would pay almost no taxes with some paying negative taxes. In terms of Forbes' flat tax, it just requires adding a large expemption (no income up to say $25,000 is taxed) and possibly an Earned Income Tax Credit (if you worked but made less than $15,000, the gov't pays you).

Happy May Day

I only know one person that routinely celebrates May Day, but I am sure she is dancing around the Maypole today. If anybody sees her (tiny little Filipina-American, keep your eyes peeled), please give her a pinch and a punch for the first of the month for me.

My Uncle, Gene Heck

I've been writing this post in my mind for several days, but I'm having the most difficult time actually putting pen to paper, so to speak. As some of you already know, last Wednesday morning my beloved uncle, the one I am here visiting, passed away.

I've felt this overwhelming need to share with all of you, who I care so much for, how great and cherished my uncle was, but any truly just account seems impossible. The best I can hope for is to try to describe Gene, the uncle that I loved.

Gene was one of the most generous people I've ever met, whether it was his time or his money, he was willing to share it. I remember growing up that my Dad would have to pay the dinner check secretly or before Gene realized it, in order to avoid a check standoff, where Gene just wouldn't give up. Even though Gene was visiting us in Dallas from a million miles away, and there would be six of us and only one of him, he always wanted to treat. And being over here I've found that this experience is shared by many. Gene was just that kind of stand up guy. But also, Gene gave his time and his abilities. I remember when I was doing a debate through my high school as a Freshman. Gene asked me what the topic was about, and I told him. He came back the next day with some copies he made at the SMU library and an underlined section in the Federalist Papers, and then he came to my debate to cheer me on. He was so supportive; I'll always remember that.

The anecdote only begins to speak to my uncle the intellect. He could read like I look at pictures. He's written over 20 books on topics ranging from Middle Eastern history to modern political economics, some of which are still available on amazon. He has a PhD and four or five master's degrees. He loved learning, and he loved being an explorer of the world of ideas. In many ways, Gene was the embodiment of a head in the clouds academic. I recall a story of Einstein's past, where he called his secretary and asked the all important question, "what's my address?" The story has a reminiscence of Gene to it. And if there is only one thing, I could learn from Gene, it'd be to marry the right woman. My Aunt Adrienne was his guide, his focus, his true north. Adrienne is a Vollmer (like my mother), and as best I can tell, while they where many hats, on the inside they are all engineers at heart. Where he saw big ideas, she saw plans and processes. I don't think he could have accomplished half of what he did without her. It's a rare and beautiful love and marriage that lasts 40 years in today's society, and any man that found that is truly fortunate.

It wasn't until I got here that I was introduced to Gene the businessman. Gene's been in Saudi almost 40 years, and there just aren't any other Americans that can say that. He was beloved and remembered (in their own words) by Arabs,"We have lost a man of high moral values, a great scholar and a leader who selflessly served the American Business Community in KSA ...Gene and I were talking to each other to get together for a lunch before the end of this month! I could not believe this and could not sleep a couple of nights, just thinking of him, his talent, vision, economic expertise and knowledge of not only KSA but the Muslim and Arab world." and Americans, "if you stepped off a plane in Saudi Arabia for the first time and went to the US Embassy and asked them what to do to get started doing business in Saudi Arabia, they would, without hesitation, direct you to Gene." The word iconic is used a lot and seems to fit.

But what I will always remember is Gene the uncle and friend, whose visits I always cherished and set aside time for. We would spend hours drinking, debating, and solving the world's problems. If being politically like-minded made a friendship, ours would have been a hard one, but it only reminds me of an anecdote he liked to tell about what Ronald Reagan said to Democratic speaker of the house and good friend Tip O'Neal at a toast, "If I was granted two tickets to heaven, I'd gladly take you with me. But if I had only one ticket, I'd gladly give it up and go to hell with you." My uncle was a master of anecdotes and jokes. They were clever and insightful, and many, especially the Saudi ones, I am only now truly understanding. He was a drinking buddy's, drinking buddy, and some of his wisdom I heed even today, "If you drink alone, you're an alcoholic, but if you drink in front of your computer, you're a writer." He enjoyed life deeply, and each moment I got to spend with him made me enjoy life that much more.

While this loss is devastating, in the few days I've had to reflect on his passing, I've realized how blessed I am to be on this trip. I got to spend three weeks with Gene, and the two of us have never been closer. I was able to better appreciate his life here, and meet a few of the many people who his life has touched. I would never trade that to ease the pain I feel now.

I hope you find rest and peace, Gene.

Forever and ever, Amen.

Softball

I had a couple of softball games the last couple of days. It was fun. I hit the ball pretty hard in the first game; a fly out to left and two hard line drive singles was enough to get me moved from batting last to fourth. Then I had a couple of infield hits and a sac fly (one might of been an error, didn't see it). All in all, I should be much better at softball than I am. I've always had three mistakes that tend to creep into my swing: weight on the front foot (lunging), head coming up, and shoulder flying out too soon. All are probably related, especially the last two. I'm still not used to sitting back as much as I need to in softball, so it's easy for these problems to creep into my swing.

We all have uniforms complete with baseball pants. Grown men in baseball pants look ridiculous.

English is Everywhere

One thing that is noticeable immediately when you enter Riyadh is that English is everywhere. Almost all signs are written in Arabic and in English. There is much, much more English here than in European cities like Rome and Paris. We've always had English speaking waiters, and random people we run into from guards or shop keepers, seem to always speak English. My uncle speaks very good Arabic and almost never uses it. As far as I can tell, there isn't much of a reason to learn Arabic. Not that it wouldn't be nice, but it doesn't seem necessary to do well in Saudi. An interesting example from a story that an official told my uncle, about a bad move Northrop made, "Most defense contractors send a retired general who says, 'I know what these planes can do, because I've flown them for 30 years.' Northrop sends an Egyptian who says, 'Hi, I'm Ahmed, and I can speak Arabic."

The Rug Shop

We went to the rug shop in the old city center a few days ago. I didn't have my pictures on the computer, so I wanted to go ahead and post them now. The rug shop is beautiful. The tall guy in the picture is John, one of my uncle's friends. He was the one in the market for a new rug and on the far left is the shop owner. He is Pakistani, and he at least convinced me he had wonderful rugs. The thread counts of his best rugs are 900 to 950 knots per inch. Many of them are from Iran, but not necessarily all. The rugs are beautiful and have a light and dark side, meaning when you turn the rug 180 degrees the colors look very different. You sit at one end of the shop and they serve tea and water and show you rugs. I really enjoyed it. A top quality rug costs at least $3,000 and the most expensive we looked at were around $8,000.

Traditional Dinner

Basel took Gene and I to Najd Village, a restaurant that serves traditional Saudi Arabian food in a traditional Saudi Arabian environment. The building is made of mud with strong trees forming the structure. We ate outside sitting under a patio in little walled off areas. Each is like a little traditional living room; we eat on the floor on a carpet leaning against pillows. The food is served family style all in the middle of the rug. The food was pretty good and even Gene enjoyed it. He even tried the baby camel, which is a big step for him. It was a beautiful night and made for a great time.

A Compound

When I'm at my uncle's place, I live on a compound called Al Yamamah. "Compound" sounds a bit harsh to American ears, but it's a bit more like a gated community or a suburb (for some of the bigger ones) than a base. That being said, there is a lot more security than the typical gated community, at least, getting in and out.

This is the first guard house. The picture is being taken on the way out, so cars would be coming in the opposite lane. The procedure is, you drive up and stop and open the latch on your hood. One guard will check under your hood and the other uses a mirror to check under your car. They are looking for bombs, of course. Then you drive to the next guard house, in between the two are barricades, that you must slalom through. They would be tough to navigate at high speeds if you tried to just crash your way through the first guard house.

This is the second gaurd house. I can't really tell what people do here, except wave you through. Though, I imagine they know our car and it's probably where visitors and what not check in.

Next, I've got a picture of the gate and the wall around the compound.

So that is the basic security of our compound. There are only two American families on the compound, so we really aren't a target for anything and it feels very safe. I thought I had some pictures of the grounds, but not the case, so I'll try to take some and post them soon.

Kingdom Tower

Went to Kingdom Tower yesterday, but I couldn't get the post up. It was during the daytime, but this picture is much cooler. At the very top, 100 floors up, there is a sky walk that we walked across. There is a restaurant on the 77th that we checked out and will eat dinner at one of these nights. We made reservations for tomorrow, but we'll probably be out at the "countryside" instead.

Skylines: Dubai vs. Riyadh

UAE's per capita GDP of $38k is more than KSA's of $23k, but it's still interesting how different the skylines are. Again, a lot of this is due to Saudi restrictions on height of buildings that was waved for its two big towers.

Al Faisaliah

Left, my picture. Right, professional from the web.

Two days ago, we went to an ABGR steering committee meeting at the Al Faisaliah, where the headquarters of Exxon-Mobile in Riyadh is. I don't know if it matters, since you wouldn't be able to get up the elevator without an escort anyway, but I won't tell you what floor it's on. When you get to the floor, nothing is marked, and the first room you get into is like a safe room, only one door can be open at a time. That is, everyone goes in, you shut the door, then the next door will open after whatever security precedure is done.

Once you get up in the tower, the view is amazing. Riyadh is a sprawling city; Basel seemed to think it is the third largest by land area in the world, but that claim is not easy to back up, because defining such a question meaningfully is not easy. The take away point though is that Riyadh is sprawling and flat. The city has had several ordinances against building tall buildings. There are two sky scrapers, this one and the Kingdom Tower.

The ABGR steering committee was interesting. I have never really sat in a grown up meeting like that, where everybody was an equal and making group decisions. It's kind of interesting and I enjoyed it. As part of the meeting, the group agreed to give 100,000 SR (about $26,500) to the American school in Riyadh. The school is very close to where my uncle lives, so I look forward to checking it out.

We had delicious Turkish food after the meeting. For the first time, we were still downtown at nightfall. The city lights up so beautifully. It looks a bit old and dust covered during the day, but at night shines like a jewel in the desert.

Breakfast with the ABGR

The American Business Group of Riyadh is a professional organization promoting business between American and Saudi companies. I've been impressed with the organization, while here and attended a breakfast they had yesterday. The speaker was Gregory Gause from the University of Vermont. I'll try to briefly summarize his talk. First, even though he identified himself as a lifelong Republican who switched parties, because of the Iraq war, he gave credit to both President Bush and King Fahd for spending lots of political capital on maintaing the US-Saudi relationship after 9-11. He then discussed what he saw as two myths and two legitimate problems in the future for US-Saudi relations.

Myth 1: China will began projecting force in the Gulf. This myth extrapolates from the fact that China increasingly has economic interests in the Middle East and will further those interests by projecting military power, thus threatening the U.S.'s own military. Gause thought that this was wrongheaded. He said for better or worse, the Gulf is more or less an American lake and it makes little sense for China to do anything but free ride off that fact. Since China's main interest is in the free flow of oil, and the U.S. was already providing the security to meet that goal, there is little reason for China to expend its own resources. Twenty years down the road the geopolitics may be different, but for now, he saw China as a non-problem.

Myth 2: The U.S. will sell out Saudi interests in brokering a deal with Iran. This is apparently a real concern from Saudis. The Saudis are in a precarious position, because they really don't want a U.S./Iranian conflict, since it may well play out in their backyard. But they also fear U.S. becoming too chummy with Iran and brokering a deal that hurts Saudi interests. Iran has 3 times the population of Saudi and have gained considerable power since we invaded Iraq. But Gause thought that Iran's power was a bit overblown. Iran has terribly mismanaged their own government and economy in recent years and not capitalized on the fall of Sadam. Also, if the U.S. couldn't dominate the region, there is no reason to believe Iran would be able to, even if the U.S. brokered an unlikely deal.

The two problems are:

Israel - No suprise here. The ongoing problem of the middle east that has been managed so far, but he pointed out that the Palestinian problem is increasingly a problem all Muslims identify with even if they have no connection to it directly. He thought that when Patreaus went before congress and said flat out that the lack of a Palestinian state was costing Amercian lives was not a monumental shift in policy, but enough to sit back and take notice.

Environment - He saw the U.S.'s new interest in Green technology and the environment as potentially a challenge for the relationship. The Saudis have fought a little bit to keep oil prices down below $100, helping broker important deals at OPEC in part to mitigate pressure to develop alternative energies. Gause didn't have a strong opinion about whether a Cap and trade or other important environmental bill would pass, but it is something that seriously concerns the Saudis.

Lunch with the Fabulous Basel

My first business lunch in the kingdom was with the incredible Basel Al-Jabr, CEO of MASIC. Here is a nice picture of Basel I found on the internet from a few years ago. He is a very insightful and articulate guy. He is from Riyadh, but after undergraduate work he spent a few years in the states in L.A. preparing for and completing his MBA. When I asked him about Saudi's future he named five important sectors.

Oil and gas - obviously still the lifeblood of the kingdom's economy, but there is still lots of room for new technologies to be deployed and increasing efficency in production in years to come.

Construction - right now there are more projects than available companies in Saudi Arabia, Basel thought there was a $120 billion back log in projects.

Middle income and low income housing - Over half of Saudi's population is below the age of 25. In the coming years, these people will getting married and buying a house. I personally hope they build the housing, so these kids don't have to live with their parents.

Education - Saudi's take education very seriously. There is a higher concentration of American trained Ph.D.s in KSA (Kingdom of Saudi Arabia) than anywhere else in the world. There will be a continued effort to educate the young population and also to improve graduate studies in the kingdom.

Consumer goods - he didn't give a lot of explanations, but if KSA continues to grow this would be an obvious candidate. We also got into a discussion of KSA's income distribution, and the middle class seems to be much more prevalent than I had thought before I came. I will have to try to find some numbers, but that is certainly the feel I get from the city.

Telecomm - lots of room for growth here. Most everyone has a cellphone, but the internet is not nearly as pervasive. My uncle just purchased internet for his apartment and bought 12 months of unlimited internet for $56 a month that is running at 603 kbps. I think it's close to state of the art here, and it is wireless (wimax) and easy to set up, but slow.

I really enjoyed meeting Basel. He invited me to join him at a very old traditional restaurant, where we'll sit on the floors and eat the traditional food from Riyadh. I can't wait.

Health Care: What's the Problem?

I promised some wonky posts and here is the first. I find that the graph above is almost completely unknown by the general public. What the graph shows is the expenditure of each country on health care per person in the country. What's really nice is that the graph breaks down public and private spending. Look at just the dark blue, public spending, starting at the U.S. and scanning over you'll quickly see that the U.S. spends more tax dollars than France, Germany, Denmark, England and Japan. That is, in some ways we have "socialized medicine" already we just do it so badly that we don't get anything for it. Of course, the even more obvious note is just the staggering amount the U.S. spends on health care per person compared to other advanced countries. We spend more than twice as much the average OECD country. A caveat is that only Norway and Switzerland are approximately the same as the US in terms of standard of livings, GDP per capita, Norway having slightly better and the Swiss slightly worse. [Luxembourg is habitually ignored, because it is strange in many ways. Its GDP/per cap is approaching twice the U.S.'s].

So these are the numbers, the question becomes "are we getting a good deal?" I'm going to leave that to the readers.

Jet Lag

I got in late the 29th, plane at 9:20pm, cleared customs 2 hours later and in bed around 1am. I woke up at 6:45am the first day and was starting to get tired at 9:30am. I stayed up until 10 or so though. The next day I woke up early again, but didn't hit the wall until 3:30pm. Yesterday I got up at 5:30am and didn't really hit the wall. I stayed up until about 10:30pm. But unfortuanetly, while I wanted to call an into jet lag last night, this morning I woke up at 3:30am and couldn't get back to sleep. I stayed in bed until 5am and then got up. Today is the last day of the weekend, so we are celebrating the coming day. I've got a lot of research to do though. I've got a lot of wonkish posts I want to write today.

Censorship

Aside from the internet gaming that I can't participate in from here, the Saudi censorship hasn't been very noticeable. Worried calls from mothers are another story. Yet, I have always found appeasement to be an underrated strategy, so I acquiesce. Sadly, I was going to have a post that titled G @ mbling is Illegal at Bushwood, Sir where I was going to take great pains to avoid potential censorship, but the best part of the post was the title. The truth is that I haven't run into too many things that were censored, though those certainly exist. And while I don't know what gets a site banned, it doesn't seem to be based on simple word searches. Citizens are encouraged to report objectionable sites, and I'm pretty sure that creates a big discrepency. It's probably just easier to block something an angry reader or group of readers suggests than check them all.

Since my only follower so far is a fellow gamer, I'll add some items of interest:
Stox (ok)
Kill Phil (ok)
Card Runners (oddly blocked), the only one without a potentially censorable word in the title.

My Blog is Up!

Today, I woke up at 5:30am after starting to get tired at 3:30pm and being in bed by 9pm. So far, I've hit the batting cages to hone my softball swing, lifted some waits, had breakfast, and finally, most importantly, set up my blog!

I'm looking forward to blogging. I'm trying very hard to keep my posts short and somewhat interesting. Though it's more of a journal than anything else, if the posts are short enough, some of you may actually suffer through it. Today is Thursday like a Saturday (the weekend is Thur/Fri here). Now that this is up, I'll try to post more, and as I get settled, my posts will hopefully get more intersting.

This Post was Black Markered

Not for the reasons you think. I'm on facebook.

First Day

I woke up at 6:45am with the sun shining threw. It's much brighter much earlier here. I got up at 7:15am and showered and made scrambled eggs and strips of something I'm afraid to say for legal reasons. Gene woke up shortly after, so I made him some too.

The weather is amazing right now. I'd think I was in Florida—just warm enough for short sleeves and shorts, but not hot. It'll be interesting to see how warm it gets as the day goes on. We are going to check out the facilities today and scan my visa stamp at a friend's house so my aunt can get me a badge to go on the military base. Then Uncle Gene is going to show me around. I can't wait to see downtown. We'll be spending the next couple of days outside the city in a compound in the countryside, so hopefully I'll get this blog up and running then.

I Have Arrived

The Air France flight was uneventful; it wasn't quite as nice as the delta flight. Everything went pretty smoothly, until I got to Riyadh and had to go through customs. Customs took two hours. They were finger printing and taking pictures of every person, something they apparently don't always do. I met a cool German guy in line who was standing just in front of me. He was a chemical engineer on a short trip, also his first time in the country. I asked him if he had ever been to Texas, and he told me about how he'd driven route 66 down from Chicago to L.A. down through west Texas on a motorcycle. Later he told me about hitchhiking from NYC to the Pacific Ocean in the 70s; so far he's done a lot more interesting things in the U.S. than I have. I was lucky to be standing next to him, because they started a new line and grabbed him to be the first person. I'm pretty sure it's because he was an older well dressed white guy, and they didn't want him to have to keep waiting. It honestly probably saved me another two hours of waiting, which is fortunate because Air France had told my aunt and uncle that no one from the flight was still waiting (how would they know?), which freaked them out a bit. It's 1am here, so I'm going to bed. Hopefully, I'll feel ok in the morning.

Bleary Eyes

I guess I got some sleep on the plane, because I just woke up and they served breakfast. I got maybe three hours or so. It's 3:43am in Dallas; we land in Paris at 4:29am and I'll embark again 6:50am. I'll be in Riyadh at 12:55pm (God willing), so about 9 hours left. I thought I was a kick ass road warrior when I wrote the last post, then shortly after I felt pretty terrible before I went to sleep. I am back to feeling pretty good again, hopefully it lasts.

First blog post ever, not even on a blog

I'm writing this first post from a plane leaving North America somewhere over Canada and the Atlantic Ocean. And while I'm writing this on word, rather than on a blog, it still amazes me that I'm sitting on a chair 35k feet above the ground with my computer plugged into an outlet. It's 10:45 pm Dallas time, and I arrived to DFW at 9am Sunday projected to be landing in Riyadh at 1pm CST Monday. So after another glass of wine and a couple of poker instructional videos, I'll be half way.

Highlights so far:

1.Free Delta Sky Lounge: I went into the lounge with the intention of paying $ 50 for a lounge pass this morning. Thinking I might as well buy it at the beginning, since it's a flat rate for my whole trip and I'll probably want it later. And I figured, at least in expected value I could make up the cost playing poker and kill some time on my layover. Well, the guy saw how far I was going and invited me as his guest, "Save your money. You can use this pass in Atlanta to get in the lounge there too. "Hat tip Delta.

2.Won $ 180 playing internet poker against the softy Euros in the morning games and $ 50 playing the early evening games in Atlanta. So that's nice, since I may not be able to play in the kingdom.

3.Reading Keith Ferrazzi's Never Eat Alone. It is a book filled with insight and advice of a practical nature that I sorely need. The beginning focuses on goal setting and even dreaming and was one of the things that inspired me to try to move abroad. It took a long time, but I accomplished a goal-I'm on a plane pursuing a new adventure, whatever mistakes I've made, that's something. I'm sure I'll use the book as a jumping off point for many future posts.