Saturday, July 31, 2004

Lo Duca trade

Yesterday, the Dodgers traded Paul Lo Duca, Guillermo Mota and Juan Encarnacion to Florida for Hee Seop Choi, Brad Penny and a minor-league pitcher, Bill Murphy. Using the Win Shares list from The Hardball Times for this season so far:

Rank  Player         Team   POS    Bat  Pitch Field  Total  ExpWS    WSP  WSAA
 37   G Mota         LAD    P     -0.5    8.5   0.0      8      4  1.082     4
108   P Lo Duca      LAD    C      8.9    0.0   3.4     12     10   .626     2
375   J Encarnacion  LAD    OF     6.3    0.0   1.4      8      9   .429    -1

 38   H Choi         FLO    1B    11.9    0.0   1.0     13      9   .751     4
 82   B Penny        FLO    P     -2.4   10.3   0.0      8      6   .694     2
  -   B Murphy       -      P       -      -     -       -      -   -        -

Obviously Murphy hasn't established any sort of value, but is worth more than nothing. So the Dodgers gave up 28 to get 21+ Win Shares. But look at the last column, Win Shares Above Average. I'm not convinced the statistic is accurate, but I think it tells the story of the trade. Encarnacion has hurt the Dodgers because he's been taking time away from the other outfielders:

 62   M Bradley      LAD    OF     9.0    0.0   2.8     12      9   .639     3
 90   D Roberts      LAD    OF     7.4    0.0   1.4      9      7   .621     2
 97   J Werth        LAD    OF     4.7    0.0   0.5      5      3   .937     2
263   J Grabowski    LAD    OF     3.4    0.0   0.3      4      3   .538     0
546   S Green        LAD    1B     6.4    0.0   1.2      8     11   .360    -3

Ok, maybe they should have found a way to trade Green as well.

Monday, July 26, 2004

Home improvement weekend

This weekend, Joy and I finally started painting our room. We'd bought the paint months ago, but the task of stripping away the pealing paint and prepping seemed pretty daunting. On Saturday, we finished stripping paint and applied one coat of primer. Our room smelled awful and since we had disassembled our Select Comfort bed, Joy and I slept on sleeping bags in the living room.

On Sunday we bought another can of primer and a new screen door. The old screen door had gotten warped and was falling off its hinges. For some reason, it had been installed in the molding, which is rotting away, rather than the door jam. We bought a vinyl door that matches the window frames our landlord had installed. Not only does it look good and require no maintenance, it was also easy to install. First you mount a bar with the hinges and then you mount the door to the bar. Easy.

Then Joy discovered why the previous door as attached to the molding. There isn't enough of a gap between the main door and the screen door for both to be closed at the same time -- the door knob is too long. There's no hurry to fix it, because I don't have a big enough drill bit to install the screen door's handle.

Tool of the week: paint roller with shield. (You'll have to roll down a bit if you follow the link.) I can't imagine painting a ceiling without it.

Saturday, July 24, 2004

Late night reading

Joy fell asleep just now while I was reading Raising Cain. I just finished the chapter on fathers and sons and now I'm reading about mothers and sons. Joy fell asleep because she's been chasing down our very active one-year old.

She's done a great job dealing with Joshua. As the book points out, mothers and sons start out with the closest of relationships and that often doesn't ever change. What does change is the way boys and men learn to express their love for their mothers. Joshua isn't always eager to be held and often pulls away to explore the game cabinet or play with a toy. Joy has been on the lookout for ways she can help him play safely and strikes a good balance between hovering over him and ignoring him.

My own mom struck a similar balance. I remember how hard it was for her to help me fill out applications for the military academies and schools on the other side of the country when I was in high school. But she let me go and helped get Dave and Doug into the Air Force Academy. I know that every time I got on the plane headed for Los Angeles, she cried, but I never heard her complain.

Boys and men have to know that the women in their lives have confidence in our abilities. I've made enough mistakes in life to know that I need people to help me clean things up. Freedom to risk failure is a wonderful gift because it communicates trust.

Getting things out

Looking back at the things I've written here, I'm stuck by how haphazard they are. I've gone back to correct wording here and there, but for the most part I've tried to write things quickly without worrying too much about how they come out. Partially I've done this because "The best is the enemy of the good."

Perhaps more to the point, ideas that never leave home don't earn their pay.

Friday, July 23, 2004

Why I buy the S&P 500

When it comes to finances, it is always good to have a benchmark. For instance, for emergency savings, there is no reason to settle for less than the interest rate on short-term Treasury bills unless you need the convenience of a checking account. The benchmark for longer-term investing is the S&P 500 index.

When I first looked at the mutual funds availible to me in my 401(k), only one fund seemed like it might surpass the S&P 500 benchmark -- Fidelity Magellan. But Peter Lynch was no longer its manager. With huge amounts of money invested, it began to resemble the S&P 500, but with more expenses. I decided to watch Magellan's progress and invest in the index fund. As it turns out, Magellan has "returned" -3.17% annually to the index's -2.04% over the last five years.

There are three elements in the success and failure of mutual funds to beat their benchmark: 1) investment skill, 2) expenses, and 3) investment domain. The first and second points are obvious and, in theory, counter-balance. An index fund requires little to no skill, but minimum expenses. A managed fund has more expenses, but rewards investors with more gains from investment skill. In practice, many managed funds fail to beat their benchmark even without accounting for expenses.

The third point, investment domain, is a description of what sort of securities a fund is allowed to invest in. Over a long period of time, stocks of small U.S. companies have returned more than government bonds, for instance. So all other factors being equal, a small cap fund will do better over many years than a government bond fund.

An S&P 500 index fund has low expenses, will match its benchmark and invests in the 500 largest public companies in the United States. It may not be exciting, but it has been the bulk of my retirement savings for the last five years.

A parable

There once was a town with one well and everyone was sick all the time. Each citizen of this town survived only because there was an abundance of barely edible roots in the area. No one enjoyed more than a few moments in the day and none slept much at night.

One day, a certain man from that town discovered a spring far from the town's only well. He drank from the spring and the next day he felt a little less sick. So he went to the spring again and felt better still. Soon he was healthy and going to spring every day.

This man began to search farther away for food, and he discovered various fruits and grains that tasted better and were more nutritious than the roots near the town. So he became stronger and more energetic.

In the meantime, the people of the town noticed the change in this one man and they began to say to themselves, "Who does he think he is drinking different water and eating different food? He even is acting differently from us."

When the man heard what his neighbors said about him, he became ashamed. "Come," he said, "let me show you the spring with healthy water and the fruit and grains that make me strong." And some of the people came and saw. But others scoffed, "This man is trying to kill us! We have plenty of food and water right here."

And the town was divided between those who drank from the spring and those who drank from the well, those who ate roots and those who ate fruits and grains, and those who were sick and those who were healthy and strong.

Thursday, July 22, 2004

First TES data!

When I got in this morning, I learned we have data from the TES instrument. As I mentioned to Joy, I feel great satisfaction getting this stream of ones and zeros from space.

Andy had set up a mail filter to send a text message to his phone every time we get data. It started going off at 4 in the morning as the guys on the East Coast started catching up on some non-instrument data. We didn't know exactly when the commands would be loaded on the instrument, so he had to keep checking.

The actual TES data came through about the same time as the morning Ground System conference call. He had the pleasure of being able to announce that the data was processed moments after someone predicted it would take 3 hours for the data to arrive. Total turnaround time from command execution to fully processed was less than 45 minutes.

Why I buy Raytheon stock

I thought it would be a good exercise to go over why I have certain securities in my portfolio. Peter Lynch says that if you can't tell a stock's story in a minute then you shouldn't own the stock.

I've been buying Raytheon stock every other week for the last five years, which means I've seen prices from about $75 to about $18. Thankfully I've bought shares mostly at the lower end. Also, I've been dollar-cost averaging into my Raytheon position, so I've bought more shares when the price was low.

Virtually the only reason I own the stock is because I work for Raytheon which matches my 401(k) contribution with company stock. I've sold shares as often as I am able, so this investment represents an opinion in the quality of the company's work environment more than in it's ability to make money for it's owners.

I worked as an intern for Raytheon for four summers and when I got out of UCLA, Raytheon Pasadena offered me a job working with JPL. I also was offered a job at the same starting salary with a dotcom startup in Santa Monica called US Interactive. Despite the possibility of a large IPO, I chose Raytheon. After an IPO at about $10 on August 9, 1999, USITQ reached a high of $92 on January 3, 2000. Fortunately I didn't even lookup the ticker at the time. Over the same time, Raytheon dropped from about $68 to about $25 on news of large "one-time charges" on earnings.

Raytheon had bought a number of divisions in the 1990s, including the part I work for which was originally a small "Beltway bandit" based in Maryland. First it was bought by Hughes, which was bought by GM, which sold bits to Raytheon. Both cars I've owned have been thanks to a GM employees discount I enjoy as a result of this convoluted acquisition path.

Raytheon also bought parts of Texas Instruments and an engineering operation, and sold off its Amana appliances division. Not surprisingly, the company had problems integrating all of these businesses. Only within the last year or so has Raytheon shed most of the baggage of acquisition and focused on its core business.

I haven't spent much time analyzing the numbers, but I don't think Raytheon is a good value at current prices. The company has consistently paid out a 20 cent quarterly dividend, which works out to 2.5% yield, but I don't see how earnings can grow. We might be in a long defense boom cycle because of September 11, but the market has already taken that into account.

Meanwhile, shares of US Interactive are not even worth the paper they are printed on, and the Santa Monica office has been closed down. Raytheon hasn't been a great stock, but it's my best investment so far.

Wednesday, July 21, 2004

Little things

I love being a father! Since Joy came home from The Pampered Chef National Conference in Chicago, I've been feeding Joshua applesauce in the morning instead of Joy breast-feeding him. He can hardly keep himself from leaping out of his seat while I mix in his vitamins and when I start feeding him, he opens his mouth like a baby bird. Once he's calmed down a bit (either because he isn't so hungry anymore or he knows I'll continue feeding him), he hums to himself or babbles, "Ma ma ma!" He likes to lean way over so that there is a shorter distance from the cup to his mouth, and he gently places a hand on my knee.

I'm pretty certain that for Joshua, "Ma" means "food" and "Da" means "play". I suppose there isn't all that much else important for him right now.

He was so worn out from the heat when I got home last night, but he hadn't slept much. I pulled out his helmet so we could take a ride which seemed really exciting to him. He enjoys himself on our bike rides, but on the way home he got fussy. I think he fell asleep for a moment and woke up confused. Fortunately he calmed down when I got home and we snuggled on the hammock for a while.

Last night, he woke up a couple of times before Joy and I went to bed. He practically threw himself on the changing table and back in bed the first time. The second time I thought he desperately wanted to be held, but he just wanted the sippy cup I was holding for him. He broke down when I pulled it out of his hands to refill it after he'd sucked it dry. When he finished drinking, he raced all over our bed trying to stay awake. He was so entertaining that Joy and I were pretty reluctant to send him to his room.

Official Aura launch photo

Here's the official launch photo of Aura. TES came on yesterday and we should get the first bit of data tonight. Posted by Hello

Monday, July 19, 2004

New outlets

I spent part of the weekend installing outlet around the house, including one GFCI in the kitchen. Originally there was only an ordinary outlet in the kitchen, so the hole in the tile was too small for the bulky new receptacle. So I had to file away some of the tile and some of the plastic bits on the outlet with my Leatherman. Finally I used a one-by-four and a hammer to force it in place. I pity the person who has to replace it -- hopefully they'll tear down the house first.

The other outlet in the kitchen was at least has hard. There really ought to be a law against painting screws and the penalty should be harsh. When the screw head got completely mangled, I unscrewed it using the Leatherman's needle-nose pliers. Fun.

I really like screws that have Phillips and flat heads. If I were dictator of the world, I'd require them everywhere.

First and Second order

Lately I've been thinking about how useful it is to divide problems into first and second order. For instance, when driving, a first-order question is "Am I in immediate danger?" and a second-order question is "Was that my exit?" It only makes sense to look at the second question after you've answered the first. I'm sure we've all seen people who have mixed the order by, say, cutting off a semi in order to get off the freeway. No doubt if you were to ask these people later if they made the right decision, they'd agree that it probably wasn't worth the risk.

Politics is another place this comes up. For months leading up to an election, candidates will say just about anything to get elected. Any chink in their opponents armor is fair game. But once the election is decided, the loser always publicly concedes the election. All of the issues between the candidates were really second-order problems. The answer to the first-order question is that ultimately the people will decide who represents them. Even if you are cynical and believe the loser conceded in order to improve his chances next time, it shows that democracy was the over-riding principle of the election. Starting democracies in places without a strong democractic tradition seems to mostly be a problem of getting everyone to really agree on the first-order issues.

The best time to observe first-order issues is during times of crisis. For about a month after the September 11th attacks, most people in America were focused on first-order things (loved-ones, life, patriotism, evil, and so-on). I imagine it was a lot longer in New York. Then as people started to notice that everyone was agreeing that terrorists are evil and firemen are brave, conversations turned to second-order issues like how much money the vitcim's families should get and which administration was most responsible for the intellegence failures.

Friday, July 16, 2004

Mental shortcuts

An article on the Motley Fool presented a little puzzle.

How are the following two rows of the alphabet organized?

The article gives one answer and points out another interesting fact about the list. The author, Bill Mann, ended the article by pointing out there is something else interesting about the list. I was the first person to write back with an answer.

The trouble is, I had to read the article in order to see the first two facts. I was completely blinded by the first thing that jumped out at me. Here's what I wrote:

> Bill Mann points out that there is yet one other noteworthy
> thing about the third list. Can you spot it?

It's in QWERTY order. Whoever typed the list must have worked though the keyboard left-to-right and top-to-bottom. That makes it exceptionally easy to spot the missing 'M'. (Not that I noticed. I was too locked into the order to either solve the puzzle or spot the missing letter.)

I think I would have eventially spotted the way the rows were sorted, but it would have required more deep thinking than I had time for -- especially since I knew the answer was just a few paragraphs further on in the article. Yay laziness!

Radiator fan cluch

My truck has been running hot for a few months, but the weather has been fairly cool. Until this week that is. Driving home from Joy's parent's place on Wednesday I ran into some traffic and the neddle on the temperature gauge jumped up near the redline. I pulled over, added some water, and it just got worse. So I drove back to Orange.

When Jim came home, he took a look. He didn't see any obvious leaks in the radiator, so he had me start it up while he held onto the radiator fan. It didn't seem like a good idea, but the fan applied almost no resistance. He even spun it backwards a few times.

It turns out the fan has a thermal activated cluch, so that it spins faster as the engine warms up. On older cars the radiator fan is directly coupled to the engine, which is wasteful and loud. On the other hand, that's one less moving part.

As long as I kept moving, the air naturally flowed through the radiator. It helped to turn on the vent and the AC, since that pulled through more air too. But when I got stuck in traffic, the radiator was worthless without the fan.

We have liftoff on Aura.

Wednesday morning I was asleep while Aura began its (hopefully) six-year mission. Fortunately there is footage of the launch. Mostlikely I wouldn't have seen anything anyway. At least that's what I'm telling myself.

Now the real work begins.

Wednesday, July 14, 2004

Mass customization

It turns out that a bunch of companies are in the business of manufacturing customized baseball gloves. Rather than going into Wal-Mart or a sporting goods store and taking a glove that has 80% of the features you want, you can order a glove that is exactly right. The manufacturers are happy because it guarantees a sale without adding much to overhead. High-end watches would also be a sensible choice for customization.

Cell phones, on the other hand, don't make sense to customize at the factory, since they are difficult to design and compete on price. Nokia hit on a brilliant solution by selling a phone with replaceable face-plates. For a while everyone had the same phone because they wanted to put Hello Kitty or the American flag on it. You see the same phenomenon in cars: everyone has the same GMs and Hondas with big exhaust pipes and extra running lights.

I'm tempted to say the one sort of customization is sensible and the other isn't. After all, a custom glove could make you a better ballplayer but you won't have better reception if your phone has Homer Simpson on it. Function versus style. The trouble is, I don't really act like function matters and style doesn't.

Exhibit A: my web-page. I spent untold hours getting everything just so, but beyond simple readability customizations, it was all about style. (Maybe not good style, but style nonetheless.) Humans seem to have a need to be different, even if they are different the same way everyone else is.

Exhibit B: I just wasted a bunch more time getting this post to look ok. It really bugs me to have lines wrap in strange ways.

Aura scrubbed again

Today I was actually watching the launch on NASA TV, which was exciting. About three minutes before the beginning of the launch window, there was an emergency hold. Aura has only a three minute window, since it is intended to fly in formation with Terra and Aqua. There just wasn't enough time to deal with the problem, so the launch was scrubbed for at least 24 hours.

It sounds like there might be weather issues with a tropical storm in the Pacific. The way I understand things, any delay beyond the 18th would mean we lose the launch site for a while -- to sometime in August.

The good news is that Joy will back from Chicago tonight, so we might be able to go see it happen at Vandenberg.

Tuesday, July 13, 2004

Aura launch delayed again.

Aura was delayed just 30 minutes or so before it's launch window closed. They are going to try again tomorrow.

A little history.

Jon's Page O' Stuff is my more or less up to date webpage. Hopefully I'll get around to cleaning it up once in a while.