Google Wave is currently in invitation-only, preview mode, so any judgment of its value in finished form is potentially premature. Two initial impressions stand out and seem often repeated. Firstly, the small set of initial invitees has the effect of limiting the kinds of conversations and the types of uses to which Google Wave can be applied. As the pool of contacts increases, this will improve, so this limit is temporary. Even so, unless Wave achieves some sort of critical mass, the kinds of conversations and uses remain limited. The second impression is that Google Wave is a solution in search of a problem. It is part real-time chat, part collaborative document writing, part threaded-Email, part blog, part journal. Each of these things is already in use, and it isn’t clear that the combination of them under Google Wave adds extra value.

The most useful aspect is that is seems (more so than typical chat or E-mail) to mimic a conversation. The least useful aspect is watching someone else type in real-time.

In the last post, my home network was a single sub-net and supported wired and ABG wireless devices including a Wii, XBox 360, one wirelessly-connected Color/FAX printer, wired LaserJet printer, two wired desktops, two wireless desktops, and three laptops. In the last week, I’ve replaced this network piece-by-piece as follows:

First, I added a LinkSys 10/100/1000 switch upstairs with CAT6 cable as an adjunct to the existing 10/100 switch and put all the higher-speed networking devices on it verifying that they all negotiated into 1Gb mode.

The most complicated part was replacing the ABG Wireless AP and range extender downstairs with a new dual-band ABGN+ Wireless Router. The initial setup is easy enough, but it assumes optimistically that it would be the only router in the mix and that it would be connecting directly to the DSL modem. NAT was turned on. It defined for itself a new sub-net (192.168.0.0/24). This sorta works, but it wasn’t exactly what I wanted because it was protecting the wireless devices from any access the wired devices might initiate. I didn’t see a way to turn disable the router portion, or I would have done that.

Instead, I have two sub-nets which roughly cut between upstairs wired versus downstairs wireless.  The setup is more complicated, but it also offers greater control over traffic. I disabled NAT on the Wireless Router so that it functions just as a Router and Wireless AP. Routing from the wireless side remains easy as all of the routing there depends on being on the same sub-net or having the packet sent to the default gateway (the ABGN+ Wireless Router).

Routing on the wired side is more complicated because some packets are delivered within the same sub-nets, some are sent to the wireless sub-net, and some are delivered to the Internet through the DSL modem. Every single machine on the wired network requires an additional route be added manually:

• Windows: route -p add 192.168.0.0 255.255.255.0 192.168.1.4
• Linux: route add -net 192.168.0.0. netmask 255.255.255.0 gw 192.168.1.4
• FreeBSD: route add -net 192.168.0.0 192.168.1.4 255.255.255.0

Even the 327W router/modem needs to be told (or told how to learn)  how to route packets to the new sub-net. Under “Advanced WAN/Route”, I needed to add the above information. The final (and possibly unexpected) kicker to the routing problem is back at the 327W DSL router/modem. It needs to be told that the “Private LAN” is no longer 192.168.0.0/24 but 192.168.0.0/23 (or 192.168.0.0 netmask 255.255.254.0). The reason for this is that the routing decision is not made until the router asks itself whether the packet is even for this private LAN. If a packet falls outside the private LAN range, it drops it.

The HP TouchSmart continues to use its 802.11G wireless operating at 50Mb/s. The Wii sees 802.11B. The other desktop received a new ABGN+ dual-band PCI Wireless adapter and is running at over 100Mb/s wirelessly.

Finally, for the XBox 360, I bought the N dual-band bridge. The ABGN+ dual-band Wireless router uses both bands simultaneously, but the clients of it are assigned mostly to one or the other band. I disconnected the XBox 360 wireless adapter, connected the console to the bridge via Ethernet the way it really wants to be connected, and assigned the bridge to use the 5Ghz band exclusively. Now, the XBox 360 plays movies without a hitch, and it signs in instantly without the previous ten minute wait.

Everything is separated by switches , routers, and bands, and it all works very, very smoothly without any additional wiring required. Every device can ping and use every other device (well, I can’t exactly copy files off the Wii or XBox 360, but you get my drift).

That’s it about the network. If there is a next post, it would be about my unspeakably weird home computing setup.

In the last installment, I described the basic single sub-net home LAN with two runs of CAT5 (one going upstairs, and one going downstairs). In this installment, I describe our foray into the wireless world.

As our kids became older, it became more and more important for us to have a centrally-located computer downstairs. So, we setup a homework desk in the breakfast nook, and I installed a LinkSys ABG wireless access point (AP) in the downstairs office. It wasn’t strong enough by itself to reach to the breakfast nook reliably, so I also bought a range extender that plugged into a power plug about half-way between the breakfast nook and the front, downstairs office. From a network topology standpoint, the LinkSys wireless AP was similar to a hub and just extended the same 192.168.1.0/24 subnet. Whatever it heard from our wireless devices was repeated on our wired LAN and visa-versa. Every device could see and access every other device. The switch provided some isolation for traffic that was directed between two machines on the wired network.

With the range extender, we could also use our laptops in front of the TV or in the backyard. Sometimes, we needed to power-cycle the extender or the AP because they would hang. It felt clunky, but it worked.

Adding the Wii to the mix was very, very simple from the Wii side. I had to enable 802.11 B on the AP because the Wii doesn’t understand G, but otherwise, it just worked. In sharp contrast, the XBox 360 install was very painful. For one, it had no built-in wireless capability at all, and I didn’t want to run yet another CAT5 line across the outside of the house given that for sound reasons, the TV room was strategically chosen to be the only room in the house with a solid concrete slab. On the other hand, I realize that no one is going to be streaming movies across 802.11 B. But, then, it got worse.

I bought the expensive XBox 360 wireless adapter thinking that even though it cost a lot, it will be worth it if it solves the problem as well as it can be solved given that I am not going to run cable. It turns out that the range extender gave the 360 fits. It initially saw that the AP and the range extender advertised the same SSID and believed that it was seeing a duplicate network, and wouldn’t use either one of them. Without the range extender, it couldn’t get a good connection to the AP. With it, it became confused and chose not to connect until after five or ten minutes until it worked the network topology out for itself. But, remember, the XBox is off most of the time, and we only turn it on when we want to play a game or watch a movie, so the ten minutes of idle time was a reoccurring cost and a constant reminder of how much I had paid for the adapter. It could have at least remembered the network topology across power cycles, but didn’t.

We also tried to use the XBox to stream Netflix movies. Sometimes it worked sufficiently well, but many times, in the middle of the movie, it would re-assess the bandwidth and drop the resolution to something really ugly and nearly unwatchable. I don’t typically anthropomorphize computers much, but in my more Clippy moods, it felt like it was intentionally punishing us for not giving it a real network — that the wireless capability was never expected to actually work. I felt used and dirty.

It remained that way for about a year. Eventually, I was going to go berserk with Home Depot’s help and run CAT6 to the room or the XBox was going to move upstairs to a make friends with a smaller TV.

But, by then, N+ was available. And, I’ll describe that conversion in Part 3.

The first part will cover the basic one-subnet, home network. The second covers the ABG wireless period including problems with the XBox. And, the last covers the current two-subnet ABGN+ wireless period.

DSL from Verizon is straight-forward for most people. The fastest available to us was the 3Mb-up-1.5Mb-down DSL (which establishes a line speed that is roughly half of that). The service came with a Westell Versalink 327W which contains basic NAT, DHCP, DNS, and port-forwarding which can be accessed with a web browser via http://192.168.1.1. It does not support or understand IPv6 partly because it is old and partly because in general ISPs, seem to be happy with IPv4+NAT.

If you don’t know what NAT is, telling you what the acronym stands for won’t help to enlighten you much either. With NAT, to the outside world, you stand behind just one IPv4 address and all the IPv4 addresses within your home are ‘private’. Your neighbor may use the same addresses for their home network, and there is no conflict. In fact, all of  the 192.168.0.0/16 range is private (as are 10.0.0.0/8 and 172.16.0.0/12). No one on the outside is expected to use those IP addresses. Any access by your machine (with its private IP address) to the outside world is translated to use the single IPv4 address obtained by your DSL modem/router from the ISP. For DSL, there is a protocol similar to DHCP (but different) which is used to obtain this address. It is enough to know that it is obtained dynamically, so its value can change.

Since the 327W has DNS, DHCP, and four ports, you can usually just hook up your computer equipment to the four ports, and you’re ready to go. The DHCP in the 327W will assign private IPv4 addresses and point your computer’s DNS to itself (the 192.168.1.1 number) which in turn is serviced by outside DNS servers provided by the ISP. There’s a way to find out what those are, but it doesn’t matter as they also can change. How the rest of the world sees the 327W is show under State/Connection Summary. Your outside IP Address as well as the primary and secondary DNS servers are shown there.

Your home private subnet is then 192.168.1.0/24, and there’s a page (Configuration/Advanced LAN/Private LAN) on the 327W where you’ll see this in the form of 192.168.1.1 for the “Modem IP Address” and 255.255.255.0 for the “Subnet Mask”. The term “Modem IP Address” is confusing because the 327W has two IP addresses as I’ve explained above — one for the outside world which can change and one for the inside world.

If four ports aren’t enough or if (because switches are more efficient than hubs) you want to use a switch instead of a hub, you can connect one of the ports on the switch to one of the four ports on the 327W and then connect everything within your home to the remaining ports on the switch. Switches are more efficient because they are aware of what equipment is connected to each port and are able to direct packets between ports simultaneously. On the other hand, a hub just repeats everything it hears on any port to every other port. For hubs, only one computer on your network can speak at a time. I haven’t used hubs in so long that I’m no longer sure how they handle having different speed equipment (10 Mb, 100 MB, and 1000 Mb) on the same network. For this reason, hubs may have died off while I wasn’t paying attention.

A footnote with regard to older switches and hubs: one of the ports might be called ‘uplink’ or there’s a button which optionally crosses the lines for one of the ports, but I haven’t seen this on the newer switches. There is probably sufficient intelligence there now to figure it out automatically. If you have a switch or hub with one of these uplink ports, note that they are designed to be organized as a tree. The uplink port should go to one of the ports of the 327W, and your equipment would be connected to every other port. If you added a second switch/hub, it’s uplink port would be connected to yet another one of the ports on the 327W, and the remaining ports could be used for your equipment. Once the four ports on the 327W were fully allocated, the uplink port of any new switch/hub would be connected to one the existing ports on the existing switches/hubs.

In my case, I used the 327W along with a switch, and all my computers were located in one room. The next step was that I ran CAT5 to one room upstairs and to an office downstairs, but it was driven off the same switch.

In the next installment, I added wireless and eventually ran into trouble with XBox 360.

Today, we have four characters:

丿
piě (also) – Left radical. This is only a radical or part of a character and does not appear by itself.

人
rén (also) – man; person; people.

丨
gǔn (also) – number one; line; down stroke radical. As a radical, this is only part of a character and does not appear by itself.

亻
rén (also) – man radical or side-man. As a radical, this is only part of a character and does not appear by itself.

Another Recap of the Financial Crises

While not increasing general price levels, and while the housing bubble was not universal, loose monetary policy inflated housing markets. Land-use regulations made the bubble worse in some parts of the country. Two more elements were necessary to achieve a level of pain beyond the standard: 1) the addition of new financial instruments (slice, dice, and leverage), 2) the push by government to promote homeownership among people with high credit risk — the Community Reinvestment Act (CRA) which forced banks to meet lending quotas in these target groups. Finally, adding Fannie and Freddie to the mix as a collecting tank of pain took the situation from painful to disastrous.

The Bailout

The U.S. Treasury intervening in AIG (taking an 80% equity stake and extending a loan at 11.3%) pushed investors holding stock in other financial firms vulnerable to similar interventions to sell their shares. While these firms held the same debt as before, the debt-to-equity ratios became much worse which, in turn, led regulators to increase their capital requirements and caused their credit rating to be downgraded . This made it impossible for these firms to raise capital (by either selling new shares or floating bonds).

These initial case-by-case steps by the U.S. Treasury had the secondary affect of making the situation worse. By late September, “Wall Street” was gone. The surviving four investment banks were either absorbed or transformed into commercial banks. Lehman was allowed to go bankrupt.

Paulson’s proposal is not in the same league as the Smoot-Hawley tariff of 1930 or Nixon’s wage-price freeze in 1971. The plan is certainly less frightening than his initial case-by-case attempts. The core idea was to buy mortgage-backed securities at a deep discount. These could likely be sold later at profit and earn income in the meantime. But, that point is now moot as the protections Congress added would require bank executives to impoverish themselves and their stockholders before dealing with the Treasury. Only companies in dire straits would participate which thwarts the purpose.

Much of the plan that Congress actually passed made little sense. Republicans, forgetting the cost of insuring savings-and-loan depositors in the 1980s, insisted on fee-based insurance. The fee becomes a tax on the safest securities to subsidize the riskiest. And, there isn’t enough data to determine what such a fee should be anyway.

The Emergency Economic Stabilization Act (EESA) also demanded that the Treasury acquire warrants. Conservatives who expressed fear about mortgage-backed bonds as well as critics of derivatives were both strangely enthusiastic about warrants which are a riskier derivative equity position similar to long-term call options. The Treasury is given virtually unlimited power to confiscate the wealth of stockholders of any company foolhardy enough to play this game. Ironically, the warrants would make it more expensive for the Treasury to buy mortgage-backed securities, and therefore make it less likely those securities to be resold at a profit for taxpayers.

Crestor

A statin drug by AstraZeneca, Crestor, reduced the risk of heart-related death, attacks, and problems by 44% compared to a placebo. This will probably change the health strategy employed over the last ten years.

Dell

Compared to its competitors, Dell is late with new products.

Radio

Radio Stations have been historically durable in both up and down times. But, now after a 18-year consolidation period which left many radio companies heavy with debt, the sector is out of favor — its ad revenue is being squeezed. Valuations are at fire-sale levels.

Porsche

The vast majority of Germans disapprove of hedge funds and short-selling. Starting in 2005, Porsche used cash-settled options to acquire shares in Volkswagen. As the price rose, these options generated cash for Porsche which it used in turn to buy more cash-settled options. By March 2007, Porsche had acquired 30% of VW. By mid-September of 2008, it had acquired just above 35%. By October 24, it owned 42.6% as well as options linked to an additional 31.5%. This carefully-timed announcement put the squeeze on hedge funds as they all ran to cover their short positions. Essentially, an auto manufacturer beat hedge funds at their own game.

Economy

Unemployment in October rose to 6.5% and non-farm payrolls declined 240,000. Non-farm payrolls for August and September were revised down significantly. The effects of the downturn are becoming more broad-based. Education and Health-Care were the only sectors to add jobs. Familiar companies are gone. Others that remain are surviving with austerity measures.

Japan is facing deflationary risk.

Robert Byrd

Sen. Robert Byrd steps down as Chairman of the Appropriations Committee. Sen. Daniel Inouye, 84, will succeed him.

New York

Mr. Bloomberg plans to meet falling city revenues with spending cuts and property-tax hikes. In the sixties, the city missed a chance to avoid near bankruptcy — instead raising taxes for new spending. It kept raising taxes until it lost half of its one million manufacturing jobs and half of its large-company headquarters. The new spending squeezed out basic services including police cutbacks. Crime spiraled out of control. New York benefited from good mayors like Ed Koch and Rudy Giuliani, and luckily an expanded financial sector.

Now, the financial sector could be at the beginning of a long-term correction. New York’s budget is overly dependent on revenue from Wall Street.

Guns

People are buying more guns — some with the expectation of changes during an Obama-administration, some for investment purposes because of changes during an Obama-administration, and some with the expectation of an increase in crime during an economic downturn.

Economy

In every part of the world, central banks cut interest rates in an effort to get ahead of the global economic downtown (predicted to be the worst since World II), but investors are placing their bets that banks will quickly run out of options and leverage. Companies large and small are taking austerity measures to survive. In the third quarter, hours worked fell 2.7% and non-farm output (a measure of productivity) fell 1.7%. U.S. unemployment is expected to rise from 6.1% to above 8%. In 2009, the IMF predicts the economies of the 31 most advanced nations will contract by 0.3%.

For Congress’ part, Speaker Nancy Pelosi has proposed a two-stage response: 1) spend $60 to $100 billion now, and 2) cut taxes next year.

Mr. Obama is picking his team including Mr. Rabm Emanuel as Chief of Staff. Challeges mount — from Russia, Afghanistan, and Democratic leadership in Congress.

Business

His choice of business-friendly advisers suggests Democrats will go slow on controversial labor and regulatory issues.

Health Insurance

Health Insurers are expecting to benefit from expanded federal programs to cover low-income children and adults even while the federal government cuts reimbursements made for private Medicare plans.

Labor Unions

Labor expect Mr. Obama to drive their agenda. At the top of the list is the Employee Free Choice Act, which would make it harder for companies to fight union-organizing drives. Unions failed to move major legislation under either Clinton or Carter.

Race

Black power brokers are ready to rise in power with Obama.

Abortion and Gay Marriage

Anti-abortion measures fail everywhere. Measures banning gay marriage pass everywhere.