And so the world awoke to news of the death of the King of Chess, Bobby Fischer. There is little I can add here that probably hasn't been written elsewhere, other than to add that it somehow all seems so right that Bobby would leave us at the numerical age - 64 - which also happens to be the number of squares that are on a classical chess board.
I have vague memories of the tall, lanky, intent, and striking looking Bobby when he was at the height of his playing powers. I can dimly remember as a small boy that my older brother was wrapped up in following the 1972 Spassky-Fischer match up. I remember that he used to play with my mother and that I would watch them, wondering about this strange game and how it was supposed to work. I do remember watching Bobby play tennis with Gail Goodrich at a tournament, but then it seemed that he disappeared from the public consciousness. I went to a parochial school where athletics was the past time of choice and none of my neighborhood friends played chess. In another time and another place, I might have become a master level player myself, but we were fated to play the newly created type of game called role playing games as teenagers. We then saw the onset of video game arcades in the 1980's, the precursors of today's home computer games. As it was, my memories of Bobby had faded like a ghost.
But it need not have been that way, and much of whether young people a generation ago might have picked up chess as a past time would in fact have depended upon Bobby Fischer. Chess, as a past time, has to compete with all other past times for time, money, and social attention, in order to thrive. In that sense, the Royal Game is no different in needing a charismatic figure than basketball needing Earvin Magic Johnson or Michael Jordon, or golf needing Tiger Woods. As it was, since he dropped out of the game, and out of public view, the surge of interest in the game - the "Fischer Boom" - was brief, like a fiery comet in the night. Bobby was literally fielding offers to play chess in Vegas for millions of dollars in the aftermath of his 1972 triumph. Anatoly Karpov became the first man to become a chess millionaire, but Fischer would have beaten Karpov to that title by 15-20 years had he stayed playing. It is a widely accepted observation that Fischer was literally 20 years ahead of his time when he was at the height of his game. Most people have no idea how much effort Fischer put into studying the game. Frank Brady wrote in Bobby Fischer - Profile of a Prodigy that Bobby owned some 480 chess books and thousands of chess magazines from all over the world in his apartment, many of which written in Russian, a language which Bobby taught himself how to read. He wrote that nearly all of the books had annotation notes written by Bobby under their board position diagrams. He had to part with some of them because he didn't have enough room to store all of them.
My thought is that Fischer, had he been a different person, would have held the title until around 1990 or so, probably losing it to a late 20's Garry Kasparov, who by that time had finally broken through the 2800 Elo rating barrier. What a match that would have been! Even today - 35 years later and armed with 3 gigahertz, 1 terabye sized disk computational power, and research assistants at their disposal - there are only perhaps 4 players in the world (Vladamir Kramnik, Viswanathan Anand, and Veselin Topalov, as well as Kasparov) who have achieved Elo ratings that are generally equal to or greater than that which was achieved by Fischer, who incidentally did all of his analysis on his own in the final age before the advent of personal computers.
Fischer could have easily amassed a fortune of over $100,000,000 had he kept playing, and could have been a hero to two entire generations of young American children. Instead, he found that once he had achieved the summit of being recognized as the greatest chess player in the world, he found that he literally didn't know what to do with himself. He gave a good chunk of his 1972 Championship winnings to a church which he then denounced (and with good reason) for malfeasance. Interest in the game cooled down after Bobby refused to defend his title in 1975. The game never really recovered and as a result, most really strong players struggle here in America to earn enough money to pay the bills. An acquaintance of mine who is a master level chess player has told me that there are only about 200-300 master level players in America (with an elo rating of 2200 or higher) who actively play the game. Most simply retire or go on to do something more lucrative.
It's hard to say where Bobby's anti-Semitism started, but it seems to me that it probably had the same roots which caused Bobby to be so difficult with his rock star, prima donna like demands which he imposed on tournament directors and game promoters. Maybe the rage from having been brought up in an unstable, fatherless household was too much for the chess board to bottle up, but that's an issue for the psychiatrists to chew over. As it was, I still find it hard to believe that he is gone. I hope that God has forgiven him and that he has left us for a better place.
Bobby Fischer - RIP.
Wizard
This past Wednesday, the Wizard discerned of voices in the wind which brought me news that there was going to be a hearing held at the City Hall Annex concerning the controversial 23 story Ashby high rise project, located at 1717 Bissonnet.
To reiterate the story for gentle readers, the builders purchased property from willing sellers in the affluent and politically influential Southampton neighborhood of inner Houston. The developer then went through the process of getting all necessary City of Houston permits and chipped in money for sewer improvements. Things were going as planned when the certain parties in the neighborhood found out about the project and went bananas, but do read the Southamption residents story first about whether the developer followed the rules on obtaining permits.
The neighborhood kicked their clout into high gear and now Houston is faced with a situation of having to meet the political demands of an affluent neighborhood, whose demands of stopping the project would, on their face, otherwise largely prohibit high rise apartment, town home, or condominium development in residential areas throughout all of Houston.
And so it was that the Wizard left his day job that evening and proceeded to head over to City Hall. I found myself in a "stakeholders meeting", but this was no ordinary stakeholders meeting if this is what you think of as people being stakeholders. The people present at this meeting were the big guns, people (or their representatives) whose opinions count for something in this City. Chairing the meeting was Andy Icken, and Ray Chong was with him. Also present were City Council members Toni Lawrence, Anne Clutterbuck (whose district includes the location of the Ashby high rise), several prominent commercial developers or their representatives, the obviously concerned residential developers, a gentleman representing the newly formed Houstonians for Responsible Growth, and a number of consultant / lobbyists such as former District A City Council member Helen Huey. In other words, these weren't stakeholders (if that is what you would want to call them) who were going to mouth off some uninformed opinion about an important subject. These were people who were very much in the know about a very important debate. Nearly all of the participants were handed out a large packet of images depicting land use maps, ordinance change drafts, notes, and so forth. As it was, the Wizard did not receive a packet as I came late to the meeting, but I kept quiet, observed the unfolding drama, and took notes. Any errors in describing the language or scope of the ordinance are solely the Wizard's responsibility.
To wit, what was being debated are changes to Chapter 45 of the City's ordinances having to do with traffic within the City municipality. Since Houston does not have a zoning ordinance which would otherwise be manipulated to swipe away the property rights of landowners and ban such high rise developments, the primary way in which the problem is to be regulated away or mitigated is via traffic studies which would otherwise supposedly cause a "disproportionate impact" on the community in question. The mitigation envisioned of course would take the form of causing smaller structures being built than those advanced by the developer because of alleged impacts of additional traffic.
Before going any further, one might dwell on the following questions. First, what is the meaning of the phrase disproportionate impact? Secondly, would the mitigation measures wipe out projects all together - an interesting idea since certain people are pushing for a denser urban area?
In his opening remarks, Mr. Icken made it clear early on in the meeting that the new ordinance is nowhere near being close to becoming a fixed ordinance at the present time, but that the changes that had already taken place were major changes from November 2007. He announced that there a number of iterations left before the ordinance was finalized. He told the assembled group that Chapter 45 was not the only ordinance that affects traffic in Houston (this is in fact true). What was desired was a narrowly focused ordinance, with few being affected, specifically areas with high density development.
The Wizard found Mr. Icken's statement to be rather extraordinary, indeed it set the tone for the entire meeting. The reality of the matter is that - yes - the Ashby high rise is in play, but the fact of the matter is that though there are a number of high rises in what could be considered primarily residential areas (again, more on that in a minute), there really are not all that many of them. I drive by two of them every day on my way into work: The Huntingdon and the Inwood Manor at 3711 San Felipe, both of which I should point out are in the heart of River Oaks. In the case of the Inwood, it abuts single lane roads on one side and both are in areas which I would consider to be single family home residential neighborhoods. In other words, what this highly intelligent assembled group was trying to do was do away with something that is a relatively rare occurrence when taken in the whole entirety of the City, and their questioning and tortured deliberations reflected that reality.
Amongst the questions expressed about the rewritten ordinance is whether the Director of Public Works is to decide whether a required traffic study is good or bad? There are supposed to be objective and quantitative measures that are to govern the revised traffic studies that are to be mandated. There is supposed to be predictability in the ordinance. Still, anyone with an inquiring and skeptical mind could easily be left wondering whether such studies could be tossed aside and left to the whims of caprice based on what is expedient from the standpoint of being able to pander to political opportunism.
Amongst the primary filters being deliberated upon are that traffic analyses will have to be filed if there are 70 dwellings per acre. In the packets that were distributed to stakeholder participants, there were pages that showed what the hoped for effects of such filters would be like when applied against a sample of large or high rise structures around town. The page then showed that once all of the filters were applied, then structures like the Ashby high rise would be the only class or type of structure that would be winnowed out and for which alterations or mitigations would have to be put into place.
Mr. Icken asked the rhetorical question, that being "how was it that we picked these numbers?" What he meant was that he was referring to the 70 dwellings per acre figure. The reason was that they were looking at areas that could be considered to be single family residential within a radius of 500 feet around the proposed new high rise development in terms of what would be "substantially impacted" by the new development. A member of the planning department then uttered a phrase which was stated no fewer than four times during the time I was at the meeting, namely that "we just don't have enough data" or "we just have so much data" to make such judgments.
Now one prominent person who criticizes planning writes in page 47 of his most recent book that:
There are several technical barriers to the success of planning. These barriers prevented planning from working in the Soviet Union, and they are just as much of a problem for American planners.
* The Data Problem: Planning requires more data than can be collected in time for it to be useful to planners;
Hmmm. Of course if you are this guy, then the aforementioned fellow who has been discredited so many times is presumably wrong regarding his thoughts on the data problem as well, ergo one might presume that raising such questions like whether there is enough data to make rational plans for something like designing (or in the case of Houston, reshaping) something as complicated as an entire City with millions of people are - well - non issues. Then how do you reconcile what I heard debated at this meeting with what was wrong about the aforementioned observations made by the book author?
Icken went on to admit that - and I kid you not - that "there is no science to choosing the 70 dwellings per acre" standard which the Planning Department chose as its level at which traffic studies are to be mandated.
The questioning started. One person asked the intrepid question whether this ordinance change would apply if there was a fire at an existing site? The answer was that if the structures were to be rebuilt as is, then no, there was to be no traffic studies to be required. If the property were to be rebuilt to higher densities, then permits and traffic studies would be required if they hit the aforementioned levels.
Then one person dropped a bomb: What exactly is a "residential neighborhood?"
Now many people, especially those who live in cities which are strictly and rigidly segregated by harsh zoning ordinances, might laugh at such a question. But this is Houston. If one travels along Washington Avenue, one witnesses single family housing, mixed with town houses and some light industry. One can also witness this along Harrisburg. Clearly some people can deal with nuisances via self buffering, and others will tolerate living in mixed industrial areas if they can obtain cheap housing. This of course flies in the face of zoning theory which often believes that people's buyer or consumer preference bundles will dictate that they will not tolerate such preferences at all.
As to what Icken's answer was as to what constitutes a residential neighborhood, which would be part of the requirement which would trigger a traffic study, the answer was - and I kid you not - "We know one when we see one!" More seriously, the idea is that the Planning department is looking to apply a standard that if 40-60 percent of the areas within 500 feet of the high rises are to be considered residential, then this triggers the traffic analysis requirement.
Despite Icken's amazing admissions regarding the fact that there was no science to choosing the 70 dwellings per acre floor at which traffic analyses were to be required, he did state that the revised ordinance was not designed to control building sizes. One thrust of the ordinance was to analyze peak hour trips in neighborhoods.
Questions were asked as:
1) What constitutes "congested street intersections?" These are to be mandated in traffic studies. Icken stated that a congested street is one where it has reached 90 percent of its rated capacity.
2) How is this ordinance to be reconciled in the mobility planning of the City of Houston as reflected in the CIP (capital improvement plan)?
3) Will the City be "guilty" of allowing more congestion? The answer from Icken is, yes.
4) Will the ordinance not be reasonably consistent with other prominent ordinances, such as the hotel motel ordinance?
5) Does everything in a 500 foot radius circle get subjected to the study? For example, say that a portion of Rice University falls within the 500 radius of the proposed high rise development? Does that mean that all of Rice University gets roped into the traffic analysis study?
6) In a related question, a fellow whom I happened to be seated next to asked what happens if the 500 foot radius of the high rise encloses part of a shopping mall? Does the mall traffic get counted in the study? If so, then how will it be applied?
Answer from the Planning officials? You guessed it: "We don't know yet. We are limited by the lack of data."
7) One person asked what would be the impact of bodies of water?
8) An intriguing situation was brought up by a woman who expressed the issue that organizations such as the Menil Collection and St. Thomas University have housing in their neighborhoods which for tax purposes is considered non-profit, but would these properties be considered residential or non-conforming residential? What would be the status of non-profit entities? Would they be considered commerical, even if they were in areas which were largely residential? She gave the example that there are nuns who have housing who are affiliated St. Thomas University and that there are artists who are temporarily affiliated with the Menil who are housed in buildings owned by both institutions. What would be their status under this revamped ordinance?
This same woman noted that many Inner Loop neighborhoods have apartment complexes mixed in predominantly single family home neighborhoods. That was a perceptive observation, since the Wizard used to live in one of those apartment complexes years ago. How would they be treated under this ordinance?
9) The ordinance is supposed to apply to streets classified as local or collector streets. Questions however were raised as to what is the meaning of words in the ordinance as abut.
So there you are gentle readers. The Wizard decided to leave early since he had spent a long day in productive wizardry already. I found out yesterday that the meeting lasted about another 30-45 minutes after I left. I also discovered that there is a very good reason for why former Mayor Bob Lanier expressed his concern about more planning and regulations. If you are scratching you head and wondering about how the sausage of this ordinance is going to turn out once it is fully ground out, then you should be dismayed to hear that I learned from one meeting attendee that there are no fewer than nineteen other ordinances whose reworkings are in the pipeline! But to quote one interested party:
Road activist Wendell Cox is being brought into Houston next week to talk to Houston City Council members on behalf of the new anti-planning effort led by former Mayor Bob Lanier, developer Richard Weekley, and construction executive Leo Linbeck, Jr. The purpose of the group, called “Houstonians for Responsible Growth,” is to stop what they call “more extensive planning and regulations” in the City of Houston.
Maybe this gentleman can explain to the public which ordinances are amongst the nineteen that are being revamped? What is their scope and how thoroughly are they being debated? After all, there is a supposed February 4, 2008 deadline for the ordinance to be tabled. Hopefully they won't be as drastic as the revisions to Chapter 19 were to groups like the Floodway Coalition. It would seem to me that if nineteen ordinances are being worked on simultaneously, and if those ordinances involve debate like the one I heard Wednesday evening, I too would share Mr. Lanier's concern about the amount (not to mention quality) of regulatory activity that has been taking place at City Hall in recent years. After all, what else are they talking about that we don't know about? After all, the revisions to Chapter 19 hit the Floodway Coalition folks like a bolt out of the blue.
In all, Houstonians should be aware that something rather remarkable has happened in this City. What we are witnessing is a challenge to the current Mayoral administration and Council for their apparent zeal for promulgating rules regarding land use. To be fair, Mayor White continues to insist that his directives are meant to be narrowly focused and that he is not in favor of broad zoning or land use regulatory initiatives. Alas, after witnessing what I saw last Wednesday evening, those assurances are not enough from making it unnerving to wonder about all those other ordinance changes and what they might mean for the future of our Great City.
Wizard
The front page story on today's Houston Chronicle bespoke of the travails of $100 per barrel petroleum to modern day society. It was a good article, underlying the fact that the oil and gas industry does not waste one drop of a barrel of petroleum, but instead finds a way to use all of it. I write here because there was one aspect of the price rise of petroleum in recent years that was not covered by the story and that is the weakening of the United States dollar as a currency. This matters because petroleum is denominated in U.S. dollars when it is traded on world markets.
To give gentle readers a sample of how much the U.S. dollar has weakened in value over the past 5 years, I point you in the direction of the excellent Yahoo Finance and world currency website. What is really great about the Yahoo finance pages is that a reader can easily compare how the dollar has fared in world currency markets and what effect this can have on tradable goods.
Examples of how much the dollar has weakened include:
1) The dollar verses the euro. The dollar has gone from being worth 1.20 euros in 1999 to 0.96 euros in January 2003, all the way down to a petty 0.678 euros in January 2008. Put it another way, the euro was worth some 85 cents when it was created. Now a euro is worth about $1.50. The dollar has effectively lost some 44 percent of all of its value against the euro in the past 9 years.
2) The dollar verses the Brazilian real. I went to Brazil in 2003 on vacation. The real, (pronounced "hey ais"), was trading at 2.8 to 1 dollar when I went there. As one can see from the chart, the real has gone from 3.5 reals to 1 dollar in January 2003 to 1.76 reals to 1 dollar in January 2008. That's right folks. The Brazilians, who possessed currencies which suffered massive hyperinflation during long stretches of the 20th century, are now in possession of a currency which has doubled in value against the dollar in the past 5 years.
3) The Canadian dollar verses the U.S. dollar. The loonie has gained 1:1 parity on the dollar for the first time in some 30-40 years, having been worth only 64 cents in January 2003. So the loonie has also gained 55 percent in value against the dollar.
4) The U.K. pound verses the U.S. dollar. When I first went to the U.K. on holiday in May 2002, the Queen's money was worth $1.50. Now the pound, which hit $2 earlier this year, is just under, currently trading at $1.97. The dollar has lost 30 percent of its value against the pound in the past 5 1/2 years.
5) The Thai baht verses the dollar. The baht was trading at 43 to the dollar in January 2003, but now it only takes 30 baht to buy a George Washington note. The dollar has slid some 31 percent in value against the baht in the past 5 years.
6) The Russian rouble has gone from 32 to the dollar in January 2003 to 25 to the dollar in January 2008.
But then we compare these numbers against some of America's big trading partners, including Mexico, Japan, and China.
7) The Mexican peso has held steady against the dollar, losing only 8 percent of its value since January 2003.
8) The Japanese yen continues to bounce around the 110-120 yen to the dollar mark, a range it has done with some exception of the endaka period of the Clinton years.
9) Even the Chinese yuan, which traded at 5.2 to the dollar when I was in China, and which was revalued at 8.28 o the dollar in the 1990's, has been gaining strength and is now at 7.4 to the dollar.
As is well known, the Asian and Middle Eastern countries have routinely purchased untold amounts of U.S. Treasuries, both to help buoy their own currencies so as to continue to be able to sell something to America on terms helpful to themselves, and as a hedge in case markets lose faith in their own currencies. They also need a place in which to invest which is relatively safe and where their money will be put to productive use. They find all of these when they buy American treasury notes. In contrast, countries which have done little to interfere with currency markets have seen their currencies strengthen considerably against the dollar.
The Wizard thinks that what we are seeing is a long slow correction in the world's terms of trade with America. The United States has been running astronomically large current account deficits for 25 years now, and we have run up trillions of dollars of debts on our federal treasuries. Americans have essentially stopped saving money. Moreover, we will see in the next decade the retirement of the Baby Boomers en masse, which will per force require the United States to either raise taxes to meet the political demands of the Baby Boomer cohort retirements, cut their benefits, or continue to let things stay as they are and run up deficits and inflate them away through a punitive devaluation of the U.S. dollar.
The logical conclusion here is that world currency markets have spoken and have decided that the United States will not put its financial house in order, hence world markets will force America to put its house in order via the devaluation of the dollar. This of course revalues the terms of trade in all tradable foreign goods. As the Chronicle article notes, Americans will find foreign travel much more expensive, but we know that petroleum is also one of those traded goods. The Wizard postulates that had the dollar retained its strength, then we would be seeing oil prices at $60-$70 per barrel and not $100. That of course still means that the price of a barrel of oil has gone up 2-3 times since 2000, but that is different from a 5 fold increase in prices. What is interesting though is that a continuing slide in the value of the dollar would presumably improve terms of trade vis-a-vis the rest of the world, but it would also continue to push up the cost of petroleum imports which in turn would offset the improvements of the balance of America's terms of trade.
It is hard to tell how much of a correction would be required for America to come back to an equilibrium. The Wizard supposes that the Chinese, Japanese, and the Middle Eastern countries would need to be convinced that the dollar would continue to erode in value to the point where they would quit buying them. That in turn would send the dollar into a fully corrective tailspin. Maybe the dollar needs to lose another 50-75 percent of its value, on top of what it has lost already, before our current accounts finally balance out once again. On the bright side, manufacturing and other aspects of the economy which are not stuck in country would find it more preferrable to stay in America rather than to flee offshore. Jobs would be more likely to stay in country, indeed some of them might come back here.
As for what that would do to the price of a barrel of oil? Well, are you prepared for oil selling at $200 - $300 per barrel? Hold on to your seat folks. That would be a great reason for those jobs to come back here if we see prices like that. Prices like that also might finally make alternatives like cellulose ethanol a viable competitor to conventional petroleum. Hmmm. Now is that another reason why those Middle Eastern governments buy up our treasury bills? Think about it.
Wizard