Oil's not well...  

I use synthetic oil and change every 10,000 miles in my cars. It's my own regimen based on the example of the big engines on  my farms, operating in extreme environments, and manufacturer recommendations of 250-500 hours.

The idea a small car like my Equinox needs new oil every 3000 is absurd.

It turns out there is a tug-of-war between oil companies and the auto industry over this bad habit.

Our oil change addiction also comes from the erroneous argument that nearly all cars should be serviced under the "severe" schedule found in the owner's manual. In fact, a quiz on the Web site maintained by Jiffy Lube International Inc. (owned by petrochemical giant Shell Oil Company) recommends the severe maintenance schedule for virtually every kind of driving pattern.
The argument that most people drive under severe conditions is losing its footing, however. A number of automakers, including Ford and GM, have contacted Edmunds data editors to request that the maintenance section of Edmunds' site substitute the normal maintenance schedule for the severe schedule that had been displayed.
About the only ones that really need a 3,000-mile oil change are the quick-lube outlets and dealership service departments. In their internal industry communications, they're frank about how oil changes bring in customers. "Many people...know when to have their oil changed but don't pay that much attention to it," said an article in the National Oil and Lube News online newsletter. "Take advantage of that by using a window sticker system [and] customers will be making their way back to you in a few short months."
Another National Oil and Lube News article tied the frequency of oil changes to success in pushing related products and services. For a midsize SUV, the stepped-up oil change intervals will bring in $1,800 over the life of the car, the article says. "A few extra services [or oil changes] can go a long way toward increasing the amount of money a customer will spend during the lifespan we estimated here," the article concludes. [More]

I use an app to track mileage and service intervals. It has become habit to enter the odometer readout and gallons each fill up. I set my service interval at 10K. Warranty be damned.

What's weird is how diligently I watch the mileage now.

(27.7, in case you were wondering)

In which I learn about capital gains...  

Well, color me embarrassed!  I got into an argument with TurboTax about some machinery I sold to Aaron as part of the transition on our farm. The stooopid program taxed the sale as ordinary income, instead of the relatively delightful 15% I had planned.

Only capital gains on depreciable property aren't like capital gains on say, shares of stock or farmland.

The income tax consequences of an outright sale can be substantial, as shown in Example 2. For the seller, a large amount of recaptured depreciation and capital gain may arise from the sale, especially if some assets have an adjusted tax basis of zero; that is, they are "depreciated out." Reporting all the income and gain in one tax year may cause some of it to be taxed at a higher marginal rate than the seller usually pays. In addition, most sellers prefer to spread out or postpone tax payments whenever possible. [More]

Which is exactly what TT calculated. All my stuff is depreciated out, thanks to Sec. 179, and all the various bonus depreciation boondoggles of the past few years. And I didn't sell any of it below above original cost.

I guess I can keep working for another few years...(sigh)

Feel free to hoot with derision at my ignorance. 

My so-called friends did...

Why staying home...  

Is a smart idea.  Unless (as is often the case) your family /friends make Black Friday shopping a social event that contributes to your holiday festivities, you could save money staying home and cleaning the gutters. (I don't want to talk about it)

What the professor has determined with a complex computer algorithm for consumer electronics, others have found through less scientifically rigorous means for other products, including clothing and toys: despite all the ads that suggest otherwise, the lowest prices tend to come at other times of the year.

In the case of toys, stores actually offer the steepest discounts in the weeks immediately following Thanksgiving because they want to unload the inventory not swept up on Black Friday, said Dan de Grandpre, who has tracked deals for 15 years at Dealnews.com.

“Toys have a very short shelf life,” he said.

“On Dec. 26, they’re not really useful to retailers anymore, so they have to get rid of it and start slashing prices early in December.”

And it is a precise window of opportunity. In the week or so before Christmas, toy prices shoot back up, Mr. de Grandpre’s tracking shows, as last-minute shoppers come stampeding for Barbies and Lego sets and stores are less desperate “because they’ve been able to reduce their inventory.” [More]

I also wonder if the recent steep slide in corn prices won't bring rampant machinery sales to an abrupt halt, much as it did this summer when we didn't know what we had in our fields. I think we are much more sensitive to such exterior phenomena than before, maybe because we are buying a lot of stuff we could postpone or even do without, rather than badly needed equipment.

Yeah, I need me...

One of these...

Lost loves...

I wrote in Farm Journal about trading off one of my favorite combines long ago (1999):

Letter to the New Owner

Hi. My name is John and I raised this combine from a pup. Over the years, this machine and I have been through a lot of experiences, and I thought it might be helpful to pass on the history.

1.    I rewired the radio to a live lead from the battery so you can sit and listen to the radio with the key off while waiting for trucks. Unfortunately, I discovered that the LCD readouts are therefore always energized, and draw just enough amps to slowly discharge the battery over a few weeks. That’s what the unmarked toggle switch is for. Be sure to turn it off when storing.

2.    The front cross auger in the bottom of the grain tank should be replaced soon. I did the back one last year, and it was so expensive I decided to wait on the other one.

3.    The low speed setting on the chopper will cause an alarm, and neither the service manager nor I can figure out why. All the parts have been tested or replaced, but feel free to spend several hours going nuts over it. I did.

4.    The attractive grain tank extension is actually homemade. (I know, you couldn’t guess.)  Under absolute maximum conditions (15%, 62# TW) the tank holds 208 bushels, not counting the pile on the cab.

5.    There is an auxiliary battery stud (+) low on the left rear side. I put this on after lugging my big battery charger all the way up to the engine deck several times because the cables are way too short.

6.    The electric fan speed control works fine, but will get stuck on max rpm. Stop just before that.

7.    The odd bracket in the cab on the upper right was to hang a bag phone on.

8.    Speaking of which, don’t talk on the phone while unloading on the go – a little advice.

9.    If the water pump goes out, you can drive at least 5/8 mile to the shop before massive engine failure.

10.The vibration dampener was replaced (by the dealer) last year. It feels like a bad water pump vibration when going out.

11.The original rasp bars are still on the machine. Each time I thought about replacing them I decided they work better for food grade corn. However, green stems are a tedious experience.

12.Some fool forgot to disconnect the header height controller wire when uncoupling from the grain header last year. Check to make sure the connector has been replaced.

13.The grain loss monitor can drive you crazy if you let it. Although the book says to find an “acceptable loss level”, this is an oxymoron, and I constantly fiddled and adjusted to get the loss down. By the way, my personal best setting was 9.5.

14.We changed the oil and filters religiously. But then again, I’m a Methodist.

15.For the most part, we have kept mice out of the cab. I think the concept of keeping ample corn supplies in the cornhead and rotor area kept them busy there. We did have a “raccoon surprise” in the fan one spring when we were moving and running the combine. Not coincidentally, that is the year we decided to upgrade to the newer style fan.

16.You can go about 150’ after the grain bin alarm goes off in 50-bushel beans. In normal corn, stop immediately. By immediately, I mean of course, not IMMEDIATELY, but easing back on the propulsion control to prevent overflow.

17.The lower clean grain elevator housing was replaced last year.  A word of warning: it wore out on the “inside” side of the boot, where the hole could not be seen. What could be seen was a bright green line of soybean plants in the field a few days after a fall shower.

18.The parts manuals are enclosed. I tried to note the year that parts were replaced so you can get some idea of what the repair frequency is. Any part that was replaced twice in the same year (as noted by “95, 95” for instance) is likely one that can be installed incorrectly or backwards, leading to immediate failure.

19.The radio is not too bad on FM, and can get WGN from about 180 miles out. Of course, I never listen to “Kathy and Judy”. Well, rarely. The tape deck will mangle approximately every fifth tape, especially if it’s Neil Diamond or disco.

20.The tallest point is (surprisingly) the top of the auger discharge boot. Notice the bolt on top is reversed to keep from catching on the shop door beam.

21.The seat raise-lower control is a real pain, but it does work, after a fashion. To prevent it pumping all the way up, lift your weight off after the proper height is reached. If your wife is about 5’7”, she might appreciate a 3” foot platform (not included) to prevent her legs from going to sleep.

22.During really wet falls, this machine is a real trooper. It will, however, generate ruts that can be felt for the next 6 years.

23.You can get the whole family in the cab if you put the two-year old in the right front corner and the five-year old on the left.

24.She answers to the name LuAnn.

To my surprise received a wonderful letter from the new owner.

This week, he just updated me on how LuAnn is getting along.

John:

I thought I would give you an update on LuAnn. She has been a very good machine for me.  I finished my farm shop the same year I got her, so she has never sat outside.  We made 300 hours this year so I treated her to new tires. I enjoyed the letter you sent me after I bought her so I thought I would give you a story. If you notice in front of the spreader there is a shiny piece of aluminum.  I had a $350 cob throw the belt off a gearbox and knock the seal out. Problem solved. She is a joy to operate, and even though she has a woman's name you can see what she has hanging under the cab*.  I enjoy reading your articles and I hope things are going good for you.

As folks today would say, Lou Ann has "had some work done".  She didn't look that good when she left my farm.  My combine friend is obviously a meticulous caretaker.

I'm glad. It makes me feel good that my happy memories of harvest with Jan and I with our boys are not the end of LuAnn's story.

How do we get so attached to machines?

*FWIW - I have no idea about the combine-scrotum-thing, and frankly don't want to know.

[BTW - the "two-year old" I refer to in the FJ article now has his own two-year-old.]

The logged existence...

[Blogger note: in this week's USFR, I answered a question about media bias, and the usual condemnation of "mainstream media" was thrown in by the viewer.  This is most frequently code for the NYT, of course, but I offer the following science story as one data point suggesting why the characterization of such publications is wildly inaccurate. Because many partisans on the right only read the political pages or damning research on evolution, they miss the much of the breadth and superior communication of sources like NYT.  This is one example, IMHO.]

I got sidetracked into a longish (25-minutes) but fascinating report about the "Data-Driven Life" which essentially explains how people (many geeks) are using new recording devices to track their own activity, and how that information affects them.

I was alternately troubled and amused, but thoroughly intrigued.  The parallel with adding the Precision Planting 20/20 monitor to our JD 12/24 1790 planter* was eerie. Just as the PP monitor now floods us with data and maps that we are just beginning to utilize, it is not such a leap to imagine what it might do to individual behavior.

For a long time, only one area of human activity appeared to be immune. In the cozy confines of personal life, we rarely used the power of numbers. The techniques of analysis that had proved so effective were left behind at the office at the end of the day and picked up again the next morning. The imposition, on oneself or one’s family, of a regime of objective record keeping seemed ridiculous. A journal was respectable. A spreadsheet was creepy.

And yet, almost imperceptibly, numbers are infiltrating the last redoubts of the personal. Sleep, exercise, sex, food, mood, location, alertness, productivity, even spiritual well-being are being tracked and measured, shared and displayed. On MedHelp, one of the largest Internet forums for health information, more than 30,000 new personal tracking projects are started by users every month. Foursquare, a geo-tracking application with about one million users, keeps a running tally of how many times players “check in” at every locale, automatically building a detailed diary of movements and habits; many users publish these data widely. Nintendo’s Wii Fit, a device that allows players to stand on a platform, play physical games, measure their body weight and compare their stats, has sold more than 28 million units.

Two years ago, as I noticed that the daily habits of millions of people were starting to edge uncannily close to the experiments of the most extreme experimenters, I started a Web site called the Quantified Self with my colleague Kevin Kelly. We began holding regular meetings for people running interesting personal data projects. I had recently written a long article about a trend among Silicon Valley types who time their days in increments as small as two minutes, and I suspected that the self-tracking explosion was simply the logical outcome of this obsession with efficiency. We use numbers when we want to tune up a car, analyze a chemical reaction, predict the outcome of an election. We use numbers to optimize an assembly line. Why not use numbers on ourselves? 

The devices and support websites to process the data are only beginning to emerge, and I sense that our natural self-obsession could lead to a growing and intensifying navel-contemplation - only with more numbers and graphs.  But is this a good thing?

 Self-experiments like Barbier’s and Roberts’s are not clinical trials. The goal isn’t to figure out something about human beings generally but to discover something about yourself. Their validity may be narrow, but it is beautifully relevant. Generally, when we try to change, we simply thrash about: we improvise, guess, forget our results or change the conditions without even noticing the results. Errors are possible in self-tracking and self-experiment, of course. It is easy to mistake a transient effect for a permanent one, or miss some hidden factor that is influencing your data and confounding your conclusions. But once you start gathering data, recording the dates, toggling the conditions back and forth while keeping careful records of the outcome, you gain a tremendous advantage over the normal human practice of making no valid effort whatsoever. 

It seems to me the more toxic social atmosphere (don't mention immigration!) is nudging us toward more self-reflection, and instead of getting signals and data about ourselves from others, it is simply easier and less socially risky to get it from a machine.  Plus it's way more accurate and less prone to emotional interpretation. Instead of friends to make us feel better we may simply check yesterday's readout to spot what made it a bummer.

Let's further suppose this idea has some merit and really does grant more satisfaction, self-discipline, and control over our action by supporting instinctive feelings with hard data. What will our interaction with each other look like?  Will it replace our need for assurance or validation from friends and spouses? I'm not talking totally, of course, but I can see some small forces to devalue social integration in favor of self-experimentation.

Lord knows if this trend gets popular, most conversation would be come a me-centered drag even worse than it is now.  The old joke about what a conversation with a blogger is like illustrates:

"My blog blah blah blah posting blah blah blah blah blah my blog" [and, yes - guilty as charged]

So one strong response to this idea is it strikes me as psuedo-scientific justification for even more narcissism.  Not that that's a bad thing for some of us, of course (heh)

But the more rigorous feedback compared to memory does seem to offer a chance to understand our own mind and body at a deeper level without traipsing off to Tibet.

The contrast to the traditional therapeutic notion of personal development is striking. When we quantify ourselves, there isn’t the imperative to see through our daily existence into a truth buried at a deeper level. Instead, the self of our most trivial thoughts and actions, the self that, without technical help, we might barely notice or recall, is understood as the self we ought to get to know. Behind the allure of the quantified self is a guess that many of our problems come from simply lacking the instruments to understand who we are. Our memories are poor; we are subject to a range of biases; we can focus our attention on only one or two things at a time. We don’t have a pedometer in our feet, or a breathalyzer in our lungs, or a glucose monitor installed into our veins. We lack both the physical and the mental apparatus to take stock of ourselves. We need help from machines.

Watch out for those machines, though. Humans know a special trick of self-observation: when to avert our gaze. Machines don’t understand the value of forgiving a lapse, or of treating an unpleasant detail with tactful silence. A graph or a spreadsheet talks only in numbers, but there is a policeman inside all of our heads who is well equipped with punishing words. “Each day my self-worth was tied to the data,” Alexandra Carmichael, one of the founders of the self-tracking site CureTogether, wrote in a heartfelt blog post about why she recently stopped tracking. “One pound heavier this morning? You’re fat. Skipped a day of running? You’re lazy. It felt like being back in school. Less than 100 percent on an exam? You’re dumb.” Carmichael had been tracking 40 different things about herself. The data she was seeing every day didn’t respect her wishes or her self-esteem. It was awful, and she had to stop.

Electronic trackers have no feelings. They are emotionally neutral, but this very fact makes them powerful mirrors of our own values and judgments. The objectivity of a machine can seem generous or merciless, tolerant or cruel. Designers of tracking systems are trying to finesse this ambivalence. A smoking-cessation program invented by Pal Kraft, a Norwegian researcher at the University of Oslo, automatically calls people who are trying to quit, asking them every day whether they’ve smoked in the last 24 hours. When the answer is yes, a recorded voice delivers an encouraging message: All is well, take it easy, try again. This mechanical empathy, barely more human than a recorded voice on the customer-service line, can hardly be expected to fool anybody. But a long line of research in human-computer interaction demonstrates that when machines are given humanlike characteristics and offer emotional reassurance, we actually do feel reassured. This is humbling. Do we really feel better when a computer pats us on the back? Yes, we do.

Jon Cousins is a 54-year-old software entrepreneur and former advertising executive who was given a diagnosis in 2007 of bipolar affective disorder. Cousins built a self-tracking system to help manage his feelings, which he called Moodscope; now used by about 1,000 others, Moodscope automatically sends e-mail with mood-tracking scores to a few select friends. “My life was changed radically,” Cousins told me recently in an e-mail message. “If I got the odd dip, my friends wanted to know why.” Sometimes, after he records a low score, a friend might simply e-mail: “?” Cousins replies, and that act alone makes him feel better. Moodscope is a blended system in which measurement is supplemented by human sympathy. Self-tracking can sometimes appear narcissistic, but it also allows people to connect with one another in new ways. We leave traces of ourselves with our numbers, like insects putting down a trail of pheromones, and in times of crisis, these signals can lead us to others who share our concerns and care enough to help. 

Please read the article and tell me how it strikes you.  I could compile a spreadsheet of the responses and start a regression...

So, I'm coming down firmly on all sides of this idea. And checking on where to buy some of the sensors.

*Weird problem with this rig: when we switched to the e-Set bean plates which only have 60 cells vs. the JD 108 cells, we stepped up the drive shaft speed proportionately.  The torque required to spin the 24 units is just about all you can get from the tire-friction ground drive.  Go through even a few juicy wild mustard plants, and your pop drops as the tire slips or even skids. We're going back to the old systme for beans unless any of you guys have suggestions.  I think these plates really work best with the hydraulic drive, IMHO.

Honest - the first thought I had...

When I heard this today

Speculation about a merger involving farm equipment makers Agco, Deere & Co. and CNH Global NV of the Netherlands increased this week, Webber said, after Fiat SpA, the majority owner of CNH, moved toward taking a stake in Chrysler LLC, the U.S. automaker striving to forestall bankruptcy. Fiat may have to sell its stake in CNH to fund a partnership with Chrysler, Sanford C. Bernstein Ltd. analysts said April 22.
Regulators probably wouldn’t approve a sale of Agco to Deere, Webber said. A Fiat spokesman April 22 declined to comment on the Sanford C. Bernstein report. Ken Golden, a spokesman for Deere, declined to comment, citing company policy on market speculation.
“I would take any sale of CNH to Agco, or part of it to Deere, as very positive,” Webber said.

[More]

was:  

Man, that's gonna be one ugly hat.

No wonder there are so many combines...

In inventory right now.

Agco’s sales are “dramatically reduced” in the region, because borrowing for a foreign tractor is now almost impossible, Greg Peterson, Agco’s head of investor relations, said in a telephone interview.
In its first-quarter earnings announcement in February, Moline, Illinois-based Deere said sales will decline in Central Europe and the Commonwealth of Independent States for the year. Ken Golden, a spokesman for Deere, declined to comment.
“Our main problems have been the lack of state subsidies on loans combined with insufficient operating cash and the general economic downturn, not the import tariffs,” Alexander Altynov, the general director of AgroSnab, an official John Deere dealer in Russia, said in a telephone interview.
Market Decline
Altynov predicted the foreign machinery market in Russia will decline as much as 75 percent this year.
Deere was expected to post second-quarter profit excluding certain items of $1.08 a share, the average estimate of 17 analysts in a Bloomberg survey. [More]

While I don't think this means we'll wring huge discounts from our salesperson, it does indicate the "take-a-number-and-wait" buying experience may be in hiatus for a while.

I also wonder if having geared up to provide big machines for the Eastern European market will be one more factor in what I see as accelerated consolidation here in the US.  I do know large HP tractors seem pretty cheap per HP lately.  

This is also a reminder why many in the US have a big stake in preventing protectionism from growing. 

Yeah - and my weight has increased "significantly"...

This winter.  A curious omission in the profit report from Deere.

Worldwide agricultural sales are projected to fall about 2 percent as the dollar strengthens and farmers grapple with higher credit costs. Sales in Western Europe are now expected to fall as much as 15 percent and “decline significantly” in Central Europe and the Commonwealth of Independent States, including Russia. South American sales may fall as much as 25 percent, wider than the 20 percent decline the company projected in November. [More]

So, why do we have percentage projections on demand from lots of places, except Russia, et al.?  I have no idea, but if they were looking to highlight this fact, they accomplished their mission.

My guess is "significantly" means "you don't wanna know".  Or maybe, like the rest of us, they don't have a clue.

Buying the big ones?...

There are anecdotal reports of sales of SUV's and big pickups showing some life as gas prices have dropped.

One was that customers, now that last summer's gas-price freakout has begun fading in their memories, are buying big pickup trucks again. The other was that nobody coming into the showroom seemed at all worried about Chrysler's possible bankruptcy. Now it's possible that many of the masses who stayed away from the showroom were put off by the bankruptcy threat, but as I'm at least a little bit dubious of the market research on this topic that GM keeps flogging, Phelan's comment heightened my dubiosity a touch. [More]

Even the incredibly improper Hummer is seeing renewed interest.

DePaula Chevrolet sold 14 of Hummers’ smallest HT3 models in December, a record for 2008.

The dealership is offering the HT3s for about $24,000, a $11,000 discount off the original sticker price.

“That kind of tweaked my interest,” Leggieri said.

December also logged some of the cheapest gas when prices dipped to $1.64, the lowest in five years.

Consumers have a short memory span for fuel prices, said Tony DePaula, president of his family’s Albany dealership.

“As soon as they came back to normal, truck sales came right back,” he said.

Sixteen­ of the 30 vehicles that DePaula sold the weekend after Christmas were large vehicles; six were Hummers and 10 were Chevy Silverado pickups.

Northway Toyota in Latham also saw an uptick in the sale of its full-sized SUVs and Tundra pickups. [More]

As for me, after this morning's reports, I'm not buying nothin'.

Our US car problem explained...

Megan McArdle has the best Auto Industry 101 post I have read.  If you have 10 minutes to spare, this lucid summary provides a good background for understanding what is happening.  Some key grafs (but please read the whole thing).

I will now attempt what I think is a fair rendition of Detroit's history over the last fifty years.    In the early 1950s, for various reasons Detroit developed a cozy three-way oligopoly.  The UAW developed a cozy monopoly on supplying labor service to that oligopoly.  In some ways, the UAW helped sustain that oligopoly.  If you're a big company whose quality suffers, you have problems.  But if you have a union making sure that labor quality cannot vary across the industry, you don't need to worry that your competitors will make a better car.  Detroit competed on styling and power, not reliability or price.
...
Detroit should have reacted, I'm sure, by making smaller cars.  But smaller cars were harder to make for Detroit.  Buyers thought of them as a non-premium product, which meant they wouldn't pay for the lucrative options packages.  And because they used fewer materials, the labor component became a relatively larger part of their cost.  Labor was where Detroit was least competitive.  According to the automotive analysts I've seen, Detroit still loses money on small cars like the Ford Focus, which are sold at a loss to help make Corporate Average Fuel Efficiency numbers come out.
...
But perhaps more importantly, Detroit turned from making money on cars to making money on financing.  Detroit didn't make a big profit by selling you a Ford Taurus.  It made money on financing your Ford Taurus; often, the car was sold at a loss in order to get the finance business.  The Big Three were banks manufacturing cars as a loss leader.
...
They also provide capital for selling cars.  Dealers have their own independent credit lines, which they use to buy cars, advertise, and so forth.  Dealers may be parasites on the body public 95% of the time, but right now, they're probably helping keep the Big Three out of bankruptcy by carrying unsold inventory, not pushing them deeper into it.

Spoiler: her conclusion is not a happy one.

Aside from being able to opine knowingly at holiday parties and farmer meetings, what do the auto industry death-throes mean to rural America? My guesses:

1. Big pickups will have many fewer models and cost a fortune. 
2. We're going to lose small dealers, like mine in Chrisman. We will travel farther for service and be more hung up when cars break down and the towing fee is $200.
3. Rural living will lose some attraction.
   
4.  I think we'll buy vehicles from now on based on three things: reliability, reliability, reliability. 
5. In more of a reach, farms located near the fringes of metropolitan centers will be worth slightly more because of this access advantage.
6. The loss of ad revenues from local dealers will be fatal to local papers and school scoreboards.
7. An astonishing number of small farms supported by auto-industry wages (especially small parts suppliers) will be subsumed into larger operations.

While this sounds not so good, I now accept it is unlikely Detroit can survive.


[John's World: All Posts]

When the accountants run the business...

Dan Anderson - who has been doing some of the best blogging around lately - touches a nerve about paying for advice from your dealership service people.

At the dealership where I work I have to account for every minute of my day. On a perfect day, every minute is billable to repairs on a specific machine for a specific customer.

But on most days, I get phone calls from customers asking my advice or opinion about repairs or problems with their equipment. Sometimes customers stop by the shop to ask questions. The questions usually take 5 or 10 minutes to answer, but sometimes stretch to 20 or 30 minutes. The customer hangs up the phone or leaves the shop satisfied with the answers he sought, but I turn around and ask myself, "How do I account for that time?" [More]

For my part, I think this is a typical result from letting MBA's at the company decide how to organize everything. The entire problem centers on the mandate to ascribe costs to customers - not provide service. This decree allows management to make decisions with the appearance of more, even better, data.  The conviction is such scientific management tools will maximize profit.

The result is arbitrary and unhelpful work rules that strike me as obstacles to good customer results.  Some ways around this are out there already:

• A "miscellaneous" category for allocating such time.  Just as we have a catch-all account for expenses that can't be allotted to a particular field, enterprise, etc. general overhead is one choice. Accountants as a rule hate this, and usually for sound reasons, but even their wish for a "place for everything" must be secondary to enhancing customer relations.
• Phone trees.  I know - we hates 'em, we does. But the doofuses who call rather than read deserve to cool their heels.  Actually, calls from guys who won't read probably aren't "very important to us".
  
• FAQ's.  My wild guess is 90% of such queries can be anticipated by a frequently updated FAQ section on the company website with good - as in Google - search tools.  As more and more of us acquire mobile Internet capability (and you will), those who need verbal hand-holding can be trained to find their own answers.
• Different levels of service.  Just like airlines, "Premium Service" could include full phone support.  The cost could either be bundled into frequent buyer profits (for instance, guys who trade every year would get it thrown in the deal) or stand-alone subscriptions.  Some of us would pay for the service Dan is handing out for free or on someone else's nickel.
  

The underlying problem here is to decide which business you are in: selling service to customers or creating neat account printouts.

No doubt about machinery prices now...

In case you had hoped high machinery prices would cool demand and soften the market, think again. My take is they will be unable to absorb even a small part of the raw materials cost pressure without getting beat up by shareholders.

Rio Tinto Group, the world's second- biggest iron-ore exporter, said China agreed to a record price increase as mining companies struggle to keep pace with surging world demand. Baosteel Group Corp. will pay $144.66 a dry metric ton for so-called Pilbara blend fines in the year that began April 1, up 80 percent from a year ago, Rio said today in a statement. Pilbara blend lump will rise 97 percent to $201.69 for the Shanghai-based steelmaker. The contract marks the first time Chinese buyers have agreed to pay more for Australian ore than supplies from Brazil, which are costlier to ship. Chinese mills have so far failed to arrest six years of increases in the cost of the steelmaking raw material. The higher prices for iron ore will help Rio defend itself against a $171 billion hostile bid from BHP Billiton Ltd., the world's largest mining company. [More]

What I'm waiting for is if farm machinery manufacturers will be asked to prepay next year's steel to protect against even more price increases.

(Snicker)

After the storm...

In my hundreds of posts are literally thousands of opinions, a few of which may actually be valuable to some readers. But what are not valuable are rants - angry diatribes spraying venom that I recoil from in the blogosphere myself.

But that's exactly the description that best fits my previous post about my new Apache AS710 sprayer. To be sure, I have issues with the operation and design, but there is no excuse not to raise them civilly. I offer none, but do apologize to my readers and the folks at Apache. It was bad writing and bad judgment in one ugly package.

Readers noted the tone of the post and their feedback helped me see my language as both extreme and confusing. Thanks to those who commented. While I have occasionally experienced "blogger's lament" before, I think this one will stay in my memory a little longer. It was unprofessional and childish. Tough seasons and work pressures exaggerate irritations, but I should be way past those days.

My Apache dealer contacted me and we discussed my problems a little more conversationally, and there may be some solutions possible. But is also very possible, that with many other satisfied Apache owners, I am the problem with the machine.

Our tiny future...

A couple of comments below about Asian minitrucks ties in with some chatter I have heard here in central IL. It seems a few farmers are opting to scoot around in one of these rather than climb into the old Ram and burn a few gallons of $5 diesel.

Each Japanese Mini Truck may have some slight variation (with respect to mileage or features) however here are the most common characteristics of a vehicle:

* Dimensions: 10 feet long, 5 feet high, 4 feet wide
* Weight: 1800 lbs
* Truck Bed: 4’ x 6’ with fold down sides.
* Bed capacity: 880 lbs
* Engine: 550-660cc, Liquid Cooled, 2, 3, or 4-Cylinder, Gasoline-powered, with approximately 40 Miles per Gallon
* Transmission: 4 or 5-Speed manual transmission, Low/High range
* 4x4, 12” All Terrain Vehicle tires, some trucks with differential lock or axle lock
* Standard heat, defroster, windshield wipers, headlights. Some units have A/C.
[More]

I had heard of a guy around here driving one after he ...umm, lost his license to drive. But then I saw one on Route 41 in Indiana last Friday. I'm pretty sure these vehicles are not sanctioned for road use, but debate continues about that.

Oddly, for $5K, it might be an answer for me. I gave Aaron my Colorado pickup to drive when he came back, and rather than plunk down for a Gator-type ATV, one of these babies would suffice to zip around our farm. It would also keep my commuting car - a studly Pontiac Vibe - clean and uncluttered with tools, parts, etc.

Sooner or later fuel costs make all kinds of formerly silly choices reasonable. When all you want to do is travel 3 miles to see if a field is dry (which after last night could be a week or so...) a minitruck could be ideal. I like the dump feature too.

How about it? Any experience/recommendations?

Another feeling digitized...

The recurring theme of my life has been the increasing reduction of sensations to digital electronic form. That a string of ones and zeroes could capture a Beethoven sonata or a photograph of a sunset was remarkable enough.

But we're seeing this translation move into the field. Already we can locate with digital signals (GPS). Now we can begin to quantify experiences that used to require muscle-memory and repetition to judge accurately.

For example, I have been pondering this spring how to explain the myriad judgment calls that setting the planter properly entails. Guaging the condition of the soil, observing the nature of the trench formed by the openers, adjusting for different fields and soils, etc. Viewed from a distance, it must sound like a mystic skill involving runes and ancient magic.

But at the advice of a friend we just added this new monitor for my JD 1790 planter.

[More info]

[Look - I realize Precision Planting advertises with FJ and has a infomercial on Channel 225 right after our shows, but I had ordered this thing long before I knew about that.]

The point is how much this will help Aaron. Trust me - he can do digital. And instead of learning the hard way and having listen to me struggle to put into words how to adjust down-pressure for example, he will have a much shorter learning curve.

This is the new paradigm for farm equipment operation, I think. Senses replaced with sensors; "feel" with readouts.

We'll let you know our experiences as soon as possible. And after Aaron gets it installed. (The silly beginner - he's reading the instructional manual!)

Order it yesterday...

Help is on the way for hard-pressed farm machinery manufacturers who need public relations cover for what would otherwise be indiscreet displays of pricing power*. Steel prices are set to explode.

The worst-case scenario could be a repeat of 2004, when manufacturers of many products, from automobiles to washing machines, faced severe steel shortages and record-high prices.

That's not happening yet, but there's plenty to worry about, according to some industry experts.

The price of hot-rolled steel, a product frequently used by metal- product companies, has increased about 6 percent in the last two weeks. Currently, some steel suppliers will guarantee price quotes for only a short period of time because they aren't sure what prices will be after only a few weeks.

Nationwide there is less than a three-month supply of some materials, and sources of imported steel have dropped dramatically.

"We see the United States entering another period of really disrupted steel prices and availability," said Bill Gaskin, president of the Precision Metalforming Association, a Cleveland trade group.

"People are seeing significant increases in prices. We have seen some reports of anticipated shortages, or nervousness, coming out of the Twin Cities area," Gaskin added.

Steel is the main raw ingredient for many manufacturers. Increased costs can translate into higher prices for manufacturing companies and, ultimately, consumers.

The price of stainless steel has more than doubled since 2003 and has remained stubbornly high for months. [More]

My sources talk about farm equipment price increases of 9-12% within days by heavy steel users. And the blame can be legitmately handed off to steelmakers, and then to ore producers.

Part of the problem is the increased use of stainless steel - which we all love, judging from the washer and dryer we just bought to put our tax rebate in circulation patriotically. [Have you priced a washer lately? Yikes!!]

"Everyone agrees that prices are moving up gradually. There is positive momentum," Rantanen told Reuters. "We still see very good end-user demand."

Much stainless steel was going into big energy-related projects such as for liquefied natural gas and oil production.

"I don't believe these types of projects will be impacted by the financial crisis," Rantanen said. [More]

Another hint of this emerging issue was the surprising Producer Price Index figure released today.

On Tuesday the government announced the Producer Price Index rose 1.0% in January, while core inflation, stripping out food and energy costs, rose 0.4%. The PPI measures inflation pressures before products reach the consumer.

The results match the core inflation increase in February 2007, and the last time it was higher than that was November 2006. Economists polled by Thomson's IFR Markets had expected overall wholesale inflation to rise just 0.3%, while core inflation was expected to increase 0.2% in the month.

"It was a lot worse than expected," said David Wyss, chief economist at Standard and Poor's, "and it shows the problems the Fed has with fighting inflation while also fighting recession." To keep the economy from slowing too much, the Federal Reserve has been cutting interest rates, but in doing so it risks creating a monetary environment conducive to inflation. [More]

These price pressures and the prospect of likely interest rate decreases are signaling money may be one of the worst ways to hold wealth. For many, this is anathema - cash is synonymous with sound business thinking. But maybe the painful lessons some of us learned in the 70's and 80's about inflation will help us overcome the love of money to protect our true wealth.

* To understand pricing power, see: wheat, spring.

I could just cry...
It's all about timing, man. The White House may be pushing an investment tax credit - (remember those?)

To Be Effective, The Growth Package Should Bolster Both Business Investment And Consumer Spending, Which Are Critical To Economic Growth

1. An effective growth package must include tax incentives for American businesses -- including small businesses -- to make investments in their enterprises this year. Giving them an incentive to invest now will encourage business owners to expand their operations, create new jobs, and inject new energy into our economy in the process. [More][my emphasis]

as part of the stimulus package, but for farmers the toy stores are empty.

"The message that needs to be put out there to the community is that the larger products –be they combine harvesters, 4WDs or larger row-crop-type tractors - could be in short supply this year," he says.

"Because of the strength of the market in North America, that's going to put pressure on all manufacturers to get large product out (of America).

"Most of the factories there are approaching capacity, or near full capacity - so any increase in demand from Australia is going to be very hard to deliver on." [More]

A neighbor returning recently from the Deere factory to pick up his new machine said there were freight cars loading combines to head to Argentina and trucks moving them to PNW to go to Russia. He also said the combine production line has been sped up about 20%.

That was not particularly confidence-inspiring...

(The new delivery date for my 9570 is now 10/6/2008.)

Lemme think a sec...

Would it get me my JD 9570 in time for harvest?

Another reason I don't own stocks...

Consider this business report from CNNMoney.com:

Despite the surge in corn demand, David A. Bleustein backed his "Neutral" rating for Deere & Co., saying its shares appear fairly valued, and "Sell" ratings for Agco Corp. and CNH Global NV, citing concerns about their valuations and the risk of earnings disappointments.

"Given that the harvest is largely complete, we expect reduced levels of commodity price volatility over the next few months, which we believe reduces the near term risk to the farm equipment stocks," Bleustein wrote in a note to investors.

Here's how some key farm equipment companies fared Monday:

Deere rose $5.43, or 6.1 percent, to $94.69, a new 52-week high.

Agco rose $4.25, or 6.7 percent, to 68.05.

CNH rose $4.61, or 7.8 percent, to $63.41.

Umm, it's January 15 and Bleustein sagely notes the "harvest is largely over"? "Reduced volatility"? Where is he doing his research - MTV?

And this guy is one of the best analysts on the street.

Still, note the market response for ag machinery maker shares. Selling to farmers is a good place to be right now.

That is, if you can get any machines to sell.