Witness the birth of the new Great Depression Part 3.

In fact, that is just what happened. Everyone started leveraging everything and because everyone was doing it, it seemed to make it all right. We piled on debt to pay for everything to be able to live for today and it was all o.k. because once all our cards and accounts reached their max we could just consolidate everything into one big newly refinanced loan by tapping into the freshly created inflation generated equity that the investment in our homes had just produced out of thin air. Pretty neat eh?

This worked so well that we got used to it and came to expect that it would work every time. Jobs were consist enough that we could count on the income to always be there and so we went ahead and obligated ourselves to make consistent payments that matched those consistent paychecks. Most Americans had it worked out so well that everything that came in was exactly the same as everything that went out. It was a smooth running machine, until one day when the price of gas went up. Now instead of it costing $20 to fill the tank it cost $40 and you don’t have the other $20 in your pocket. Something has to go but everything you have is already spoken for. Witness the pin that popped the bubble.

So stupid people make stupid decisions, this is nothing new. It has happened before and it will happen again. The key point to take from all this is that we don’t make the innocent pay the price for the ignorance of others. That is where the second comparison has come into play. The knee-jerk reactions that followed the bad choices of others as happened following the first great depression should not be replayed this time around. Obama and Congress are launching on the biggest mistake in this nation’s history and it is not without forewarning. The “stimulus package” will seal the fate of this nation as a full blown socialist state with little hope of return. There are far too many critics that have been far too quiet concerning this matter. It is not because they have not spoken in the past or in the present, but the current mass media markets have decided not to listen. Make no mistake about it, voices are being suppressed. The America of our forefathers is in jeopardy of being no more, and for the sake of being politically correct we will squelch the voices of wisdom. We will label them crackpots or worse.

There are of course differences between now and then. FDR waited several years and I imagine went through quite a bit of debate before implementing the new deal. Obama and his congress have rushed the current new deal through in a matter of days. This surprises me especially when you compare it to the regular congressional budget that usually is past after the new fiscal year has begun, and sometimes months after. Why this rush? Banks closings are up but not anywhere near the level of the Great Depression. Unemployment is up, but also not anywhere near what it was in the Great Depression. 7.5% vs. 25+% do the math.

The economy was a hot button item during the election timeframe and usually is during campaigning. The Democrats and their media talked up how bad things were when in reality things were not really bad at all. This is not to say that there were not some bad areas and some people experiencing bad times. That has always been the case in our nation’s history. There are boom and bust cycles going on all over all the time, nothing new. But like so many political campaigns, you can’t convince others to vote for you unless you can convince them that the other guys are doing worse than you would. Standard fare, I mean I many times have you heard that the last few years under the Bush administration were the worst years ever in recorded history. Kind of sounds like the same thing Bush said about Clinton and Clinton said about the Bush before that. My question is why do we continue to believe it when the truth says otherwise, or at least is somewhere in between?

So the Democrats have convinced us all that the economy was falling apart and only they could make it work again. They said it so long that we and they started to believe it. Is this the case of a self fulfilling prophecy? Pretty soon people started making decisions based on this doomsday prophecy, confidence in the system was shaken and those decisions triggered other decisions which started us down the path of an economic slowdown.

If we can raise this slowdown to the level of a crisis, then we can implement all kinds of legislation without any questions or obstacles. What better way can you think of to get your policies in place before anyone has time to think twice? It has to be done now because it will be too late tomorrow, and beside we have to do something…don’t we? The knee-jerk caught a lame duck president with a first financial bailout and followed on to the new president with the stimulus package.

This isn’t the first real estate driven crisis, remember the 1980’s and the savings and loan problem. Remember how it wasn’t solved with a massive spending bill but a revamp of the banking industry that combined savings and loan institutions with bank bringing them under the FDIC insurance for depositor safety and then orderly liquidated bad real estate deals through the use of open market pricing? Why are we subsidizing the bad institutions this time and trying to keep them in business when we should be helping them liquidate in an orderly fashion? The FDIC could play the role of insurer as it is chartered to do and protect depositors money up to the agreed upon amounts, sell off the assets of the defunct business at market prices to willing participants and we could all get on with the business at hand.

Instead we are putting the patient on life-support, one that only prolongs the misery and the pain. Japan went through a period of denial with its real estate boom of the 80’s and they are still paying the price. Instead of clearing the books they finagled them through adjustable accounting. We are doing the same. Where oh where has wisdom gone in our elected officials?

And where has our wisdom gone? This article has taken a lot of thought and effort to write. As I have watched the proceedings take place in the news and the actions taken by our elected elite, I am both in awe and wonder. I am totally dumbfounded by what is taking place. It just doesn’t seem possible that this is actually happening in real life, and maybe when I get up tomorrow I can find that I just read it wrong. That was several days ago and I am still seeing the same thing, it is really happening. I can’t stop it, I am not an insider so I can’t profit from it, and I shudder to think what it will take to reverse it now that it is in place.

When reason fails with man, and the world begins to tumble, I guess the only thing left is the thing we have had all along. Turn to God. Pray and know that God lives. As the world tosses and turns and changes with the winds and tides; know that God is the same yesterday, today, and forever. Therein lays our strength, our guide, and our salvation. Ours need not be a fleeting moment in time if we are willing to look to our Father in Heaven with eternal eyes. My prayer for us all, leaders and citizen alike is that we have the wisdom and the courage to make the right choices and to stand for what is right.

This is Ed Nef with a view from the Farr West.

Click here if you want to see the new Great Depression Part 1 or to go to Part 2.

Witness the birth of the new Great Depression Part 2.

So what did you want the government to do, nothing? Yes, as a matter of fact, that would have been the best course of action for it to take. If we really believe in free markets (a freedom principle) and the economics of supply and demand, then the role of government is too help protect consumers from fraud (a criminal act with criminal intent) and monopolies (manipulation of markets to gain control and prevent freedom within the market), and such acts for fairness sake, but not to dictate which businesses we can have and how we should run them or who we can and can’t deal with. It is when governments try to intervene on the belief that they can best determine how to ‘create’ fairness that we all lose.

This is called social engineering and it has never worked well if it has ever worked at all. In any instance I can think of, it comes down to taking away from one to give to another. It is providing subsidies for a favored group at the expense of a less favored group, and it is always the party in power that is making the decision of which group to favor. This is not equality this is theft, and it is the worst injustice of all. Two wrongs do not make a right. Just because your group or cause may be winning the ‘equality equation’ one minute is no guarantee that it will the next. Welcome to the roots of Socialism and Communism. Ayn Rand, F.A. Hayek, George Orwell, and many others have tried to warn and persuade against these evils.

So if the government would have done nothing, the market would have worked itself out and life would have gotten back to normal a lot sooner than it did. Remember the words about supply and demand. Basic economics says that when a seller and a buyer have the same price in mind, a transaction takes place. If there is a difference in the desired price each is willing to accept then no transaction takes place…that is until they come to an agreed price. Of course, if a seller’s price is less than what a buyer is willing to pay or if a buyer’s price is higher than the seller is expecting a transaction will also occur with a happier than expected outcome for one of the participants.

If prices rise too far, buyers quit buying or buy less than they normally would until either their situation changes or prices fall back to a level they are willing to accept. This is where the true power of the market and more importantly the people’s power lie…as consumers. If a consumer decides that the price is too high she can just turn away, and with the markets that America has developed, they can look elsewhere. We as consumers have the power of alternatives and options, another great benefit from having free markets…choice.

So what happens in a bankruptcy? The prices fall to clear inventory. How far the prices fall is determined by the market and the need to move that inventory to meet the demands of the defunct business. Again the market place determines a fair price by matching the seller with the buyer at a price both can live with. In the case of stocks, the price will fall to some level where a buyer will believe that he can find value in the purchase. Look at the recent Circuit City bankruptcy as an example. They have invited in the liquidators who will sale all remaining inventory (and then some) at liquidation prices. First they will move all prices back up to full retail and then start marking off a certain percentage to make the sale. A few weeks pass and they will raise the percentage off to sell a little more. A few more weeks and a few more percentages, until most all the inventory has been sold off by having a willing buyer and a willing seller at an agreed upon price. The good stuff will go first at the highest prices and the lesser stuff will go as their fair price is eventually reached. It is natural, and it is how real markets work.

So what can we compare this to today? There are two common elements that exist today that were common back then. First is an overinflated market full of speculators and hype that has easy access to excessive credit for an overleveraged play. If anybody could not see the comparison to Real Estate investing then you shouldn’t be allowed to vote because you just aren’t paying enough attention to the world around you.

Real estate has been a huge hit sense someone went to the trouble of trying to convince everyone that they should have some. A chicken in every pot, a car in every garage, and home ownership, the American dream, who could ask for anything more?

Real estate promised equity and wealth, and a place of status. It was incentivized and subsidized by tax breaks and government programs. Best of all you could finance 80%, then 90%, then 100% with no money down. They even had loans that would give you 120% of the homes “value”. At the pinnacle of it all you could even find loans where you never had to pay back the principle, just pay the interest and everything would be fine. After all the prices were going up and up and up and they aren’t building any more land you know.

Everywhere you turned there was a class or a course on how to buy real estate with no money down, or how to flip a home, or buy a foreclosure, or become a landlord. Real estate gurus came and went as fast as you could change the channel on the late night infomercials. All you had to do was take a look around and you could see someone that had made a mint in real estate, why even the Governor of California made his millions in real estate so why shouldn’t we.

And even if it wasn’t to make us rich by becoming the next Donald Trump we could at least be better off. We have always been told that owning your own home was a good and smart investment. Look at the equity your building. You have ownership of something and they can’t take that away from you. Why pay someone else when you can be paying yourself? (That is good advice when applied in a practical matter).

So the equity you built is caused by inflation and not by an increase in value, and owning your own home allows you to put holes in the walls where you want to and repaint any color you so choose without checking with a landlord first, and owning your own home means you can do with it whatever you want to as long as what you want to do is consistent with existing zoning laws and property covenants and building permits, and owning your home means no one can take that away from you unless you have a mortgage and miss a payment or run up against hard times and can’t pay your property taxes, but hey it is your home.

In the past, you could only borrow an amount that would have your monthly payment no greater than 25% of one wage earners income and that was probably take home pay at that. Recently it seems that you could qualify to finance an amount that would take 80% of your take home pay. (The remaining amount could pay for cable and you could feed yourself with food stamps).

Click here to see the new Great Depression Part 3 or here to go to Part 1.

This is Ed Nef with a view from the Farr West.

Witness the birth of the new Great Depression Part 1.

There are certain stages in our nation’s history that we thought would never be repeated. In fact they should never be repeated. Those that have not learned the lessons from the past are doomed to repeat them. We have learned these lessons, or at the very least should have. For those that have not learned them, there are others that have if we will but listen. Sometimes it becomes a matter of knowing who to listen to. In this world of spin and revisionist historians, it is easy to become confused. Here then is my contribution to the economic world of wonder we are facing.

The current financial crisis we are facing has often been compared to the Great Depression. There may be some similarities and that is disturbing as this need never have happened, but with the passage of the “stimulus bill” it most certainly will turn into another great depression.

First a quick word about the economy and economic cycles. Booms and Busts. They have been with us since the beginning of commerce and will continue to be a major part of any world that consists of trade. The market psychology that comes with it is also nothing new. People get overly exuberant and overly pessimistic at the worst times and that drives the demand side of the supply vs. demand equation to unrealistic levels. Once it gets too far one way or the other, it usually returns to a more normal state but at a pace that catches most people unprepared. When this is done on a large scale it is called a bubble. It is called a bubble because prices grow rapidly and, much like a bubble, from the insertion of air…much of it hot. When a bubble can take no more air yet more is introduced, the bubble pops and everything comes tumbling back to normal waiting for someone to stick their ring in a can of solution, blow real hard and start to create the next new bubble.

We have all experienced bubbles before and sometimes not even realized it. The recent increase and then decrease in the price of oil and gasoline is a great example. The tech stock market that took dot.coms to the stratosphere and then tanked in 2000 is another. The bubble that is getting us today is housing. In order to put this into perspective and compare it to the Great Depression, let us go back to that time and see what was happening.

Most will say that the stock market crash of 1929 triggered the Great Depression while others are looking at other factors such as the governments reactions (actions taken after the fact) as the major cause of the Great Depression. From what I have seen and read, I tend to fall in the later camp.

The stock market crash of 1929 had several factors that came into play but one of the key elements was that fact that you could buy stocks on margin. In other words, you could use debt, or borrow 90% of the price of a stock to purchase it. This is known as using leverage in the investing world. It works great as long as prices are going up. It can kill you when prices go down. Here is how it works.

You buy $100 dollars in stock but you only have to come up with $10 and your broker came up with the other $90. The price of your stock goes to $110 and you sell it. You pay back the broker his $90 plus some interest for borrowing his money, say $1. That leaves you with the remaining $9 as profit and since you only put up $10 of your own money you just made a 90% return on your investment. Pretty sweet deal and way better than the piddley amount you would earn in interest from the bank.

The boom market in stocks that started in the mid 1920’s was making many people very rich, and just like the gold rush it attracted many newcomers, some that knew what they were doing and many that didn’t. It seemed that anybody could invest and make big money, and many did. And when you saw your neighbor making easy money it was natural for you to want to do the same. Pretty soon everyone was trying to jump on the band wagon and make their fortune. Eventually, prices rose to a point that was ridiculous and unsustainable and they started to decline.

When prices decline, those that have leveraged are the ones that are hurt. When the $100 stock goes to $90, and you bought it on margin, you still owe your broker $90. If you sell the stock now and pay off the broker, (and don’t forget you owe him $91 to cover the cost of borrowing) you are left with nothing. Well you don’t want that to happen so you hold on thinking this is a temporary down turn and prices will be heading up again very soon. After all you made this investment to become rich like your neighbor, and everybody is doing it. Pretty soon however the price is $80 and your broker gives you a call and says he needs some money to cover the shortfall. You don’t have any money because you spent your last $10 buying this stock that was going to make you rich. The broker sells your stock and you owe him the difference.

As the broker sells your stock it puts more pressure on the prices and they continue to go down creating a spiral effect. Individuals have to pull money from the bank to pay off their debts. If the stock they bought is used as collateral for other purchases and the value of that collateral declines the other loans are in danger of going into default. As the defaults start in one area they can quickly expand, moving from one area to another by hitting one account and then another. As people scrambled to cover their newly acquired debt and save their personal finances from collapsing, it began to impact other people and business portfolios. They in turn had to struggle to save their finances from collapsing. One person’s pain began to be felt by all.

Now remember that this was nothing new and in reality it was quite common for markets to experience booms and bust. In fact, some areas of some markets have had greater price movements both up and down. Investors have made their millions and lost everything on many occasions and in many different markets even before there was a stock market. You can find books that will describe other markets such as the great tulip market of the 1600’s that went through these outlandish pricing periods. In fact there have been many markets in our lifetime that have experienced extreme boom and bust conditions. Our awareness of them is only brought about by our personal participation or the participation of someone we know. The really big ones are only well known because they impacted a large percentage of the population. Where was the media when you lost all that money on your cabbage patch doll and beanie baby collection?

As a result of the magnitude of the stock market price decline, the impacts spilled out into all aspects of the economy from banks to business to government. The madness of men and markets drove a typical price correction into a recession of large magnitude and that should have been the end of it but then it turned into a depression as a result of the actions taken by the government to correct the problem.

Now before you get me wrong, note that they did do some things right. The margin rates were cut so that investors were no longer able to buy stocks with 10% down. The current rate is 50% which some might think is still high but 2 for 1 is a lot less than 10 for 1. They also strengthened the banking system and regulations for oversight and increased the use of insurance for depositors to restore faith in the banking system.

Unfortunately, the Great Depression also allowed the government to introduce the New Deal. This was one of those giant knee-jerk reactions from government to fix the wrongs of man. What it did was introduce many of the Socialist policies and programs that we face today. It also launched a large “stimulus” package that tried to spend our way back to prosperity. Many would say that it extended the length of the depression many years past its natural length. I would have to agree. Much of the spending went into make work projects where efficiencies and effectiveness were not considered let alone any outcomes beyond the creation of jobs as the objective. We also created the world’s largest legal Ponzi scheme ever known to man…Social Security.

This government driven economy is the very idea we used to find so abhorrent in communist nations and would speak openly against. We used to think that nationalizing any industry was something that only happened in backward third world countries and if anyone even suggested such a thing people would start looking for a hanging rope. Laissez faire has oft been the slogan of a free nation.

Click here to continue to the new Great Depression Pt. 2. or Part 3.

This is Ed Nef with a view from the Farr West.

Hi TED

As I was surfing the other day I came across an interesting site that I had come across some years ago. It is http://www.ted.com/ and it is well worth a visit. To use their own words, “TED stands for Technology, Entertainment, Design. It started out (in 1984) as a conference bringing together people from those three worlds. Since then its scope has become ever broader.
The annual conference now brings together the world's most fascinating thinkers and doers, who are challenged to give the talk of their lives (in 18 minutes).” Also as they say TED is ideas worth sharing.

You might have heard of Bill Gates releasing mosquitoes on a group he was giving a talk to. This is the place where it happened. You can see the video of this and many other talks on the TED web site. If you have never had the chance to hear Bill Gates speak, this is an easy and inexpensive way to see him in action. His talk covered Malaria awareness and creating better teachers and education which fell under is topic of “How I’m trying to change the world now”.

Concerning the education system, Bill has some charts and some interesting observations on the current effectiveness of the schooling system. I also have some ideas in this area. Bill, if you are listening, get with me. I have had an idea running in the back of my mind for some years now that would harness the power of technology to increase education on a national scale that could easily go global but it would take someone with your resources to pull it off. Where you are talking about reforming the system, I am talking about bypassing the system and getting right to the heart of the matter.

Money is part, but knowledgeable technicians and effective teachers are the other. It involves creating an on-line school that is affordable (free) and available to all. Borrowing from some other successful models such as game sites, you tube, and social sites, education could be brought to a whole new world of individuals that are not served well with the current system as well as providing continuing education to the world of people that thirst for knowledge. I can’t do it from where I sit but you could, if you truly believe in this. What the rich were to public libraries in the past, Bill Gates could be for education in the here and now.

Bill Gates was not the reason I came to re-discover the TED site. As I said the other day, aviation is a passion for me and I came across a talk that Paul MacCready gave on aerodynamics and flight entitled ‘Paul MacCready flies on solar wings’. MacCready is the person that gave rise to the human powered aircraft, the Gossamer Albatross, that flew across the English Channel and then went on to create the solar powered unmanned aircraft called the Helios which broke the SR-71’s altitude record. He is an amazing man with a creed of “Do more with less”. This interesting video can be found at http://www.ted.com/talks/view/id/176.

There is a myriad of topics and talks to be found here. I intend to delve deeper as I get the chance. Where it only takes 20 minutes I should be able to find the time. What I have seen so far just whets my appetite for more. After all, education can and should be a lifelong process. The thirst for knowledge should be unquenchable. Enjoy yours.

This is Ed Nef with a view from the Farr West.

Dreams of flying still fill my head

I was going to make an entry on economics and the new great depression and that is still to come but I kind of got distracted along the way. Saturday mornings I like to look at a few web sites and dream about aviating. I like to fly and I have not gotten near enough of a fill of it yet. So far beyond the several commercial flights I have taken, I have been given a few rides by generous fellow plane nuts, and I have taken lessons that resulted in solo flight.

My first taste of real flying, (that is anything that doesn’t involve standing in line to disrobe and walk through a magnometer), was with my uncle in his Cessna 182. I had been reading and studying in my high schooled way and knew the basics of flight and once we were air born my uncle turned the controls over to me and let me fly. It was the greatest event of the summer. My dad and brother were in the back and even though I wasn't quite as smooth as my uncle and my turns were not the most coordinated I managed to get us through the air and tour the flood area and work being done to repair the damage done by the Teton Dam flood in Idaho. Elaine Johnson has a nice story about the flood at http://www.rootsweb.ancestry.com/~idfremon/flood.htm.

Like so many things in life, when I get a taste of someone’s hobby and they really have a love for it, it is contagious and I usually want to participate and experience it for myself. Such has been the case with coin collecting, photography, books, music, movies, television, biking, cars, and flying. I could go on and on but you get the point.

I had a Boy Scout advisor that gave us a taste of simulator flying and my taste grew. Later I decided to take lessons. The cost was scary because at the time I was going to college and working three jobs but I figured it would be worth it. It was worth it but the money said either one or the other and college came first. I figured that if college worked out I would be able to make enough money to pay for my flying habit. Silly me.

Before I gave in I did manage to solo in a Piper Tomahawk…twice. That is one of those steps that you never forget. The first time was around the patch for a couple of touch and goes with a landing and meeting with your instructor who clips your tail feathers as a sign of the first time leaving the nest. It was a combination of nervous exhilaration and a sense of accomplishment that has seldom been duplicated. In fact the next time I had such confidence that I took a trip around the valley and was probably a little late getting back because the next renter was sitting there ready to go. I hardly noticed as I was having too good a time. There is just something about being in the air, just you and the machine, slipping across the country side, viewing the land from a different perspective that can’t be match from the confines of pavement.

I did try to find a way to have someone else pay for my flying, after all that is the American way. While going to school I decided to try the Air Force ROTC program and see if I could get a pilot slot. The idea was good but my timing was lousy. There weren’t a lot of pilot slots available and so the competition was high. Accountants did not score as high as Engineers and that was strike one. I was in my second year and was doubling up my ROTC classes to play catch up but that means the leaders had only seen me for one quarter where others had been around a little longer. I was still working three jobs which was taking a lot of time and energy and even though they had a ROTC presence at our school the classes were combined with the other local university. By local I mean their school was an hour drive each way from my school. This was not starting out real well.

I stayed at it as long as I could though. I even took the physical and I am pretty sure I past just fine but at the end of the 5 hour prodding they gave us a questionnaire that I was tired enough not to read closely enough. The question “Have you ever been treated for air sickness?” came across to me as “Have you ever been air sick?” big difference. At first I didn’t think it was a fair question reading it as I had since many of the candidates might never have gone up in an airplane to have the chance to experience air sickness whereas I had been up on a very bumpy commercial flight as a young teenager and had. I had the dilemma play out in my mind; should I answer honestly or lie and say I hadn’t. I decided to be honest throughout my life and I wouldn’t feel good about not being so now so I answered that I had experienced air sickness. Let the consequences come what may. I have never been treated for it but that is not how I read the question.

Between the jobs and the school schedule things had to come to an end soon or my efforts would start to deteriorate and something would suffer, grades or jobs or me. I went to discuss my odds with one of the instructors and it became apparent that they weren’t looking for accountants so I decided to drop the ROTC program and pursue the career with an eye on making lots of money to feed my desired habit. If they would have given me any glimmer of hope at the pilot slot, I would have stuck it out. Third and fourth year students that are committed receive a stipend and tuition and then the finance side of the equation would have been answered. As it is, my schooling was paid for by me through my efforts. I did not take out loans and other than living at home I did not get parental grants.

So school became the first priority and then the first job after school job. The real one, you know the one that you went to school for in the first place. It was several years later before I got to go back and try flight school again. I still really loved flying and tried to make a go of it. My job was working out so I had enough free money to use on other pursuits, and more importantly the desire was still there.

This time it was in a Cessna 152. Where the Piper is a two seat low wing trainer the Cessna is a high wing two seat trainer. They both are small, slow and simple. That is why they make good trainers. The biggest difference between the two is wing placement. Let me explain.

With initial training, one of the basic skills that must be learned is working around the airport and transitioning from a land based vehicle to an airborne vehicle. Many hours are spent honing these skills by practicing what is called a touch and go. This exercise helps refine many of the skills a pilot uses in controlling his aircraft in routine flight. The pilot flies a racetrack like rectangular pattern around the airport that includes takeoff, climb to pattern altitude, 90 degree turns, crosswind control, power adjustments, trim adjustments, traffic awareness, radio operation if there is a control tower, approach and alignment with the runway, and finally touchdown all done in a hopefully smooth and controlled manner. Once touchdown is made, the pilot will either exit the runway and return to his parking spot, or remove flaps, add power and quietly transition into takeoff mode to do the pattern over again. You can go to the airport and watch as pilots practice their skills over and over doing these touch and go’s.

When I was beginning to learn to fly in the Piper (the low wing aircraft) the visibility was wonderful. You kind of sat in this bubble which let you see all around you. Visibility of the world around you is one of the things that make flying so grand. When you make your way back to the airport, enter the pattern, it is easy to dip the wing and use it as a reference point for making the turns for the different legs of the pattern. 45 degrees past the end of the runway, time to make my turn, point the wing at the runway and rotate it around till it is perpendicular with the runway. No sweat.

When I went back to taking lessons anew, the school I originally went to was no longer in business. I chose another school but they only had Cessna. That was fine since they are both good trainers as I said. The cabin felt a little tighter but I may have grown some, and even though you sat more enclosed in the cockpit, the visibility was still good…in most cases. The first flight everything was going fine and the feel was returning pretty quickly I thought. We went out to the practice area and did some coordinated turns and stalls then headed back to the airport for some touch and go’s.

As we entered the pattern I was trying to keep up with everything as normal. I was looking to my instructor to give me direction, and I wanted him to run the radios as I focused on controlling the aircraft. The Piper was an easy plane to fly by the numbers. By that I mean you would set your plane by the numbers such as airspeed, engine speed, and such at any stage of flight and then trim to release pressure and the plane would practically fly itself. The instructor would say “at this point reduce power from 2100 rpm to 1700 rpm to start the decent while maintaining 70 knots. It still took some coordination but once you where there it just worked.

My Cessna instructor didn’t quite operate the same way, so while I was looking for numbers to try and work towards, his approach was to take each landing on its own merit and continually adjust the aircraft attitude to match the given situation. This maybe the better way to handle things because then you can recognize when you are too high, or too low, too fast or too slow, or your running long on a segment and can make adjustments as you go. It was when it came time to turn base that really shook me. I lined the wing up with the runway looking for that 45 degree point to start my turn….The time came…I started my turn…The runway disappeared…Completely.

That was a little unnerving to say the least. In the low wing Piper, the wing fell away and the full airport was in view, but in the high wing Cessna, the wing dropped into the turn and blocked my view of everything. I was trying every way possible to see through a solid object but to no avail. I immediately adjusted my outside view to try and incorporate new position reference points that I could use and determine when I had completed a 90 degree turn. I didn’t have any at hand so I just guessed. That ought to be about right I said to myself and leveled out the wings. I probably missed it by about 15 degrees but it must have been close enough that nothing was said.

Soon enough I got the hang of the Cessna enough that they let me solo in it a few times. I again had to put aside my training as a job change took away the time that I could devote to study and practice. I didn’t think it would last as long as it has.

My thoughts of flight have not left, the desire is still strong. The FAA has created the new Sport Pilot License that should make it easier to get and keep a license, especially if there are any medical issues you might be concerned about. I don’t have but I like the simpler approach it offers. You basically self certify with a valid driver’s license rather than have the continual expense of periodic third class medicals. There are restrictions on what you can fly as well as where and when but it seems a worthy trade off. The hard part is finding a valid light sport aircraft with which to rent and train as well as a willing instructor. I may have to travel and dedicate a week to an accelerated course to finish my schooling.

There will be a plane of my own in my future. I don’t know what exactly yet. I am still looking and that as always is part of the fun. The best classifieds for aircraft I have found so far is http://www.barnstormers.com/ which has a very good selection and a well laid out site. I can lose many an hour day dreaming there.

Of course anything aeronautical interest me and the other way to feed my habit is to tune into the http://www.ultraflightradio.com/ for wonderful interviews from people in the industry about the industry. You can tell that they love this stuff just as much as the rest of us.

Until I can finally make the dream come true and start flying my own aircraft as often as I want, I will have to make do with the dreaming and occasional sharing. Evidently I haven’t given up on my dream and I hope you don’t give up on yours either.

This is Ed Nef with a view from the Farr West.

Search Me

As I stated earlier, this year I am going to show a renewed effort to increasing income. That includes trying to make a successful blog. I mentioned that I would share with you my efforts in these regards and so I shall. Just as I have profited from the lessons of others, perhaps you can profit from the experiences I have gone through. By sharing these with each other we all benefit. I do not subscribe to the ideal of knowledge being power only when one person has it and withholds it from another. Knowledge only has power when it is put into motion. Pass it on, pay it forward. That is how we all have been benefited and enjoy what we have today.

So in reviewing the blog results over the last year as I have shared with you on the anniversary entry, I notice that I haven’t reached that ‘viral’ stage that so many have had to hit to see real results. Do I expect to become a household name with global recognition? Sure, doesn’t everyone? Reality of course deems that real readership will fall somewhere between one (me) and the worldwide population. I’m comfortable with that.

After all, not everyone will find these rantings amusing or even interesting. Some will. I hope you are one of them. I don’t have to please everyone. Not only is that difficult, it is impossible. ‘You can’t please everyone so you’ve got to please yourself’ is a wonderful lyric as well as a hint of wisdom.

As you might have noticed, I have made some slight changes to the layout of the web site. Call it experimentation. I am trying to fine tune it and will continually try to make it better. In the process I somehow lost Google Analytics tracking ability. Google Analytics is a tracking program you load on the web page that counts how many time a page has been viewed and how many times it was viewed uniquely. It tries to see how people found your page and if they looked at another of your pages or went on to other parts of the web. It does not identify anyone specifically or in detail, just an aggregate summation of the blogs usage. If I were making specific marketing campaigns and trying to drive sales, I could use analytics too help quantify the effectiveness of different advertising approaches. As this page is about anything and everything and not about marketing any products other than the blog itself, analytics is not being used the way other sites would use it.

Anyway, in the process of moving some items around and changing the Google ads display sizes and ability to display images, I managed to lose the analytics tool. It took me a lot of searching to finally come up with the fact that I needed to reload the code. I then had to track down the right code and my id code that goes with it. The simple 5 minute copy and paste operation lasted two hours. I have checked and it looks like it is working again.

That is the thing about new technology; it comes with a new language. And like any language it takes time to learn. When computers were first introduced I remember seeing stories on the news about the changes the dictionaries had to make to add all the new words that were being created to describe the workings of computers. This explosion of lexicon was amplified by the increase of personal computers and the internet. The word blog itself is an example of this as abbreviations such as web log created first slang then standard verbiage.

As I have entered the world of online ads and marketing and blogs I have been introduced to a whole new world of language. Some I have easily adopted from previous exposure to the computer world and some that is totally foreign. Some of the terms and their meaning are easier to decipher than others. For some there doesn’t seem to be any easy reference points to quickly gain their meaning other than slogging through and hoping that repetition and context will provide a clue. Sometimes it does sometimes it doesn’t.

Repetition and context have taken me a long way though. I can read some HTML when looking at it better than I could before. With ads there are terms like e-CPM or effective cost-per-thousand, and bounce rate and absolute unique visitors. Some make sense right away while some take time to see in action to fully comprehend.

Now to go back a little, I said that my analytics tool quit working. How did I know this? Google Adsense comes with its own tracking software code that is loaded on the web page. Whereas the Analytics tool is an option you add, the Adsense reports come automatically as a result of signing up an account to display Google Ads. Google Adsense reports are much, much simpler showing basically number of page impressions and number of clicks on ads with amount earned for those clicks and it only breaks it down into today, yesterday, week, month, last month, and all time categories. It doesn’t even tell you which pages were looked at or which ads were clicked.

Honestly I don’t even know what ads are placed on the site and that is why I added the disclaimer to the pages about the ads sponsoring me and not the other way around. I figure that if this site gets bigger and really popular, say like a Rush Limbaugh or Glenn Beck, then I will start to dictate the ads and sell them direct. Until that time, you partner with someone that knows the business and can take care of that my knowledge and background isn’t large enough to handle. Google knows this part of the business and that is why I am here and using them.

So Adsense was the tipoff that Analytics was not working since one report showed visitors on these given days and the other didn’t. See, it is good to get information and facts from more than one source. Problem identified, problem fixed.

Or is it? I still seem to have the problem of not getting enough traffic driven to my blog. I know from experience that part of the problem is that the search engines do not see me. Analytics has shown me that the majority of traffic coming to my sight from search engines came from Google. I am glad that Google sees me but that is too be expected since this blog is hosted on a Google site and uses Google ads but what about the hundreds of other search engines out there?

I know Yahoo saw me at one time but it doesn’t seem to be able to find me now. IWON that uses the Ask search engine had never been able to find me. I have used that fact to gain points for searches as you can see on my IWON hint pages but it is discouraging. I have tried any number of different combinations or words and topics and even spelling out the web address with no matches found. This is the same result on a dozen other web sites.

As I have been searching for a solution to this problem, I ran across the idea that you had to submit a web site so that the spiders or web crawlers would go take a look. I have done this a few times and I think that is why I got a few hits from Yahoo and MSN but they only looked once and they only looked at a few pages. Google is the only one that has many pages listed.

Even finding the method to submit your web page is difficult for many of the search engines. Some you run across by accident, others from a link, but many don’t seem to want to publish this information at all. This seems strange since a search engines business is to search the web and provide all the information out there to its users. You would think that whichever service did this the best would be the winner in the search engine competition but I find a lot of them lacking.

I have stated this before about most searches now just pointing you to the commercial sites and missing all the great individual informative small sites all together. Those were the fun days of the web, when you could actually connect to people and not just businesses. It was back when businesses didn’t know what the web was or what to do with it. There must be a balance in there somewhere.

If you search for ‘search engines’ or ‘submit a site’ on most search engines you will get all kinds of things, not many of which are useful. I have found that there are a lot of services out there that will mega submit your site for a fee. Some will do it for ‘free’ only to find that free also has a cost of adding their software to your site, or submitting to a constant barrage of e-mail. Jayde Online is one such company that I have signed up for and though I haven’t seen any results from the supposed submission I have seen a large influx of e-mail. They do say I can unsubscribe at any time, but I will try their newsletter for a little while and see if there is any value. So far it looks like it is directed at full on business sites.

I have learned two things about search engines and their web crawlers. First, web crawlers will look at your site if it is referred to by another site that they have crawled. The more sites referencing your site, the more chances that your site will be looked at. Therefore, if someone is surfing and comes upon this site and decides to add mention of it on their site and it is one that gets crawled there is a chance that my site would be added to the list of sites to get crawled. That is why there are many people selling cross listing services or doing the “I’ll list your site if you list mine”.

Once the web crawler as decided to take a look at your site it must have permission to look and this is granted in a file called ‘robot.txt’. The robot.txt tells web crawler what they can and cannot look at. As I found this out I decided to take a look at mine and see if it is blocking sites. I kind of think that it might be but I cannot for the life of me figure out how to change it back to a simple basic open door policy. As near as I can tell this is a Google BlogSpot hosting rule. They help you set it up initially and block things if you so desire, but it is a set it and forget it notion. I have always had the intention of having this blog shared with all so I tried to leave the setting open. I thought I had anyway. I cannot find a way to directly access the file as it is on the BlogSpot server and after hours of searching I finally came across the setup menu for the robot.txt file, redid what I thought I needed to do but it looks exactly as it did before. This may be something I just have to learn to live with.

The other mentioned items for the web crawlers is a site map of which I am not sure how to develop, again because of BlogSpot’s lock on things, and Meta Tags. I think I am using Meta tags as the topic links that I include with each entry but I am not sure if it is the same thing as what the web crawlers are looking for. These are a couple more examples of this new language I was talking about. For those that already know what these things are, do not laugh. Just reflect on the first time you heard some of these terms and remember how you just went along with it rather than admit you didn’t know. It happens to everyone, and it happens all the time.

In order to get the address out there and see if this referencing thing has any merit I am going to be surfing the web a little more and dropping the web site address if possible in comment boxes and wherever suitable and see if it makes any difference. I am not going to do this in a spamming manner. The name dropping will only be done with true contributions and comments of relevance or not at all. I still want to maintain the better side of the web where people interact with people in a positive light. I would rather shed light on the sleazy characters and scare them back into their cockroach dens than promote their way of doing things. I know I won’t always measure up to the highest standards but at least I will be trying, as I hope you do too.

This is Ed Nef with a view from the Farr West.