What happened?

A bunch of us got together to watch the opening ceremonies and cast on for our projects. I had a little trouble being that I haven't used the magic loop technique before and my cast on was incredibly tight. So I finally got started in the ribbing of the sleeve and when I went to do the increases to start the lace portion, I had some trouble so I had to tink back. And guess what?...Could you tell from the picture where the ball of yarn seems to be absent?? The yarn broke!!!! AARRGGHH!! The mohair is not working out for me...it's not stretchy, I can barely see the stitches...It's all too much on top of trying to do this magic loop thingy. I have to go to the stash to see what else I can get guage on. In the Olympic spirit, I will not give up! This shrug will get finished!