The Steussy Ranch

This morning, back home from San Francisco, I’m nursing a blown back (the joys of growing older) and watching Wall-E with the kids. It’s the third time I’ve seen it.

There isn’t another movie that hits all of the right cords like Wall-E does. I’ve been a fan of Pixar movie studios through Toy Story, the Incredibles, and Cars (the only Pixar movie that got a so-so rating from me).

If you haven’t seen Wall-E, I can’t recommend it enough. It’s quality work for adults and kids alike. I hope it gets the Academy Award for Best Motion Picture, but I won’t hold my breath.

I’m in San Francisco for MacWorld. Will be back soon with more.

These are my new desktop images (one for each monitor). Click on them to get a full-size image to use yourself.

NGC 7635: The Bubble Nebula
Credit & Copyright: Russell Croman Explanation: It’s the bubble versus the cloud. NGC 7635, the Bubble Nebula, is being pushed out by the stellar wind of massive central star BD+602522. Next door, though, lives a giant molecular cloud, visible above to the lower right. At this place in space, an irresistible force meets an immovable object in an interesting way. The cloud is able to contain the expansion of the bubble gas, but gets blasted by the hot radiation from the bubble‘s central star. The radiation heats up dense regions of the molecular cloud causing it to glow. The Bubble Nebula, pictured above in scientifically mapped colors to bring up contrast, is about 10 light-years across and part of a much larger complex of stars and shells. The Bubble Nebula can be seen with a small telescope towards the constellation of Cassiopeia.

ABOUT THIS IMAGE:

Astronomers, using the Wide Field Planetary Camera 2 on board NASA’s Hubble Space Telescope in October and November 1997 and April 1999, imaged the Bubble Nebula (NGC 7635) with unprecedented clarity. For the first time, they are able to understand the geometry and dynamics of this very complicated system. Earlier pictures taken of the nebula with the Wide Field Planetary Camera 1 left many issues unanswered, as the data could not be fully calibrated for scientific use. In addition, those data never imaged the enigmatic inner structure presented here.

The remarkably spherical “Bubble” marks the boundary between an intense wind of particles from the star and the more quiescent interior of the nebula. The central star of the nebula is 40 times more massive than the Sun and is responsible for a stellar wind moving at 2,000 kilometers per second (4 million miles per hour or 7 million kilometers per hour) which propels particles off the surface of the star. The bubble surface actually marks the leading edge of this wind’s gust front, which is slowing as it plows into the denser surrounding material. The surface of the bubble is not uniform because as the shell expands outward it encounters regions of the cold gas, which are of different density and therefore arrest the expansion by differing amounts, resulting in the rippled appearance. It is this gradient of background material that the wind is encountering that places the central star off center in the bubble. There is more material to the northeast of the nebula than to the southwest, so that the wind progresses less in that direction, offsetting the central star from the geometric center of the bubble. At a distance of 7,100 light-years from Earth, the Bubble Nebula is located in the constellation Cassiopeia and has a diameter of 6 light-years.

To the right of the central star is a ridge of much denser gas. The lower left portion of this ridge is closest to the star and so is brightest. It is experiencing the most intense ultraviolet radiation as well as the strong wind and is therefore being photoevaporated the fastest. The ridge forms a V-shape in the image, with two segments that are aligned at the brightest edge. The upper of these two segments is viewed quite obliquely as it trails off into the back of the nebula. The lower segment comes both toward the observer and off to the side. This lower ridge appears to lie within the sphere described by the bubble but is not actually “inside” the shocked region of gas. Instead it is being pushed up against the bubble like a hand being pushed against the outside of a party balloon. While the edge of the hand appears to be inside the balloon, it is not. As the bubble moves up but not through the ridge, bright blue arcs form where the supersonic wind strikes the ridge to form an apparent series of nested shock fronts.

The region between the star and ridge reveals several loops and arcs which have never been seen before. The high resolution capabilities of Hubble make it possible to examine these features in detail in a way that is not possible from the ground. The origin of this bubble-within-a-bubble” is unknown at this time. It may be due to a collision of two distinct winds. The stellar wind may be colliding with material streaming off the ridge as it is photoevaporated by the star’s radiation.

Located at the top of the picture are dense clumps or fingers of molecular gas which have not yet encountered the expanding shell. These structures are similar in form to the columns in the Eagle Nebula, except that they are not being eroded as energetically as they are in that nebula. As in the Eagle, the clumps are seen to emit light because they are being illuminated by the strong ultraviolet radiation from the central star, which travels much faster than the shell and has reached the outer knots long before the expanding rim will.

Object Names: Bubble Nebula, NGC 7635

Image Type: Astronomical

Credit: NASA, Donald Walter (South Carolina State University), Paul Scowen and Brian Moore (Arizona State University)

It’s that time of year for predictions. Here are mine. My views are based on:

• My reading on the economy, both from personal experience and through the filters of the Wall Street Journal and the Economist.
• General understanding of human nature. Markets are moved by #1 Fear and #2 Greed. And Fear is much, much stronger than Greed.
• Recent travel – we spent seven months in Europe last year, and got to see both the old and new Europe functioning much better than expected.
• Lots of on-the-ground reports. In my job, I coordinate hundreds of contractors across the world. Last year, it was clear to me that Iceland was wildly overvalued – the cost of getting Icelandic translations was two to three times other European languages and much higher than other Scandinavian ones. I handle over 40 languages, so it gives a good bit of breadth to my information.
• Take any of my predictions with a grain of salt – this is not what I do professionally.

PREDICTIONS

The Fed is currently flooding the markets with lots of free (or very cheap) money. While this may or may not fix the problems in the system, it will certainly create a one-off inflationary episode over the next three years. We will see double-digit inflation over that period.

This will cause most of Wall Street’s current problems to subside: overvalued houses will be cheaper, the cost (and consequences) of all of the financial misdeeds of the last decade will be devaluated to the point where they are no longer a hindrance on the system.

Unfortunately for normal folk like us, the traditional safe harbors in a time of inflation are real estate and gold. Since there were vast increases in both of these prior to the current period, and that increase was part of the cause of our problems, they are unlikely to be good safe harbors today.

A further effect will be a severe recession in two to four years, when the Fed goes all out to tame the inflation it is creating now. But, let’s stick with the present right now.

The US will climb out of the global recession first, faster than any current widely held prediction. It will first appear in the stock markets very early in the year, followed by a quiet cleanup of the foreclosure overhang by the end of 2009 or beginning of 2010. Public perception will be greatly influenced by lots of newspaper articles about the recovering stock markets (Dow reaches 12,500 only months into the new year), but there will be very few articles about the real estate rollup. Real estate will not show great returns on investment, but stocks will.

Europe will appear to be strong in the coming three to six months, mostly due to Germany’s refusal to print Euros in response to the downturn. Germany’s stance will force a much longer recession on Europe, which it will not pull out of before 2010. Italy will be under enormous pressure this year, though I do not think they will leave the Euro.

Further, Western Europe will start its decades long decline, driven by sclerotic markets, too-strong social supports, their attendant top-heavy tax structures and by their long-term aging problems. Eastern Europe will fare somewhat better, but even Czech and Slovakia won’t attain parity with a much-reduced France/Germany until the end of the 2010’s.

Japan will be the most stable international market over the next three years, with no wild swings in any direction.

Best markets for returns will be vulture investments of bankrupt assets in areas under extreme stress: Latvia, Lithuania, Hungary, Romania. China doesn’t make the list because: it is not an open market, it has a lot of internal demand to keep things moving and its government is painfully dependent on growth. China will go through a period of financial instability sometime in the next decade, which may have political consequences.

Over the next three years, other good investments will continue to be the emerging world (Thailand, Malaysia, India, etc.) – their stocks were brutally beaten down over the last year and they will remain risky, but very good growth will come from them. Investment in US stocks will appear excellent on paper, though once enormous inflation is factored in, returns will be in the 8 to 12 percent range this year and slower but still positive in 2010 and 2011.

Industries: US auto makers will face problems. GM will be unable to repay its government loan and will be a ward of the government for the foreseeable future. This will have a knock-off effect on Ford, which if it stood alone in the US market would be in a strong position to go head-to-head with Toyota, Honda and VW worldwide. With government-subsidized, inexpensive GM cars facing them in the US marketplace, there is less room for Ford to generate income domestically and expand.

Health Care. The battleground here will change drastically with the incoming Obama administration. Medicine is one of the few areas to retain pricing power, and they will use it this year to raise prices wildly in one of their final unregulated years to produce windfall profits – centered mostly in the insurance providers.

Technology will continue to become more and more stable as a source of profits. Microsoft will churn out a profit, Apple’s income will continue to grow (though Steve Job’s health will likely effect the stock price negatively). Smaller companies will churn as before, with some outstanding successes and a larger number of outright failures.

Biotech will again offer promise, but no final breakthrough as the new, explosive industry of the 21st century.

Financial firms will reorganize. New boutique firms, created by newly out-of-work investment professionals and with a stronger customer orientation, will do very well. Older firms will still struggle with a hangover of the past few years, digesting acquisitions and piecing apart any investment “vehicles” leftover from the mid-2000’s. New regulation will impose costs and make the firms less capable of stealing from their customers, meaning fewer profits (see the book, Where Are the Customers‘ Yachts?).

Financial Sub-set, Hedge Funds. In general, I see hedge funds as, at best, a poor investment. Their lack of transparency lends them lots of room for hanky panky. Some hedge funds will collapse and the industry will not expand as it once did, but outside of a few high profile acquisitions and consolidation, these firms will limp through the next two to three years with non-spectacular returns.

In general, the world will move toward smaller, more nimble firms with high net value intellectual property assets or the capability of creating or supporting the same. Kinda like my Solon Enterprises/Apogee Communications or NetEnforcers or Intellectual Ventures … less like GM, EDS, Microsoft.