Monday, January 31, 2011
Where Credit is Due
My Kindle froze up on Friday. After a ten minute phone conversation on Saturday, the techie said he'd replace it. New one showed up on Monday.
"Kronstadt was my Kronstadt"
It's easy to remember Daniel Bell for being wrong. It was he, after all, who (in "The End of Ideology") gave us one more of the crashingly misguided forecasts that see to be the fate of sociologists. And in his case, a twopher: Bell's prediction that we would put ideology behind us and swim in the calm seas of technocracy--that prediction was picked up and kicked into overdrive by Frances Fukayama in "The End of History," (Michael Weiss in The New Criterion says Fukayama is "badly indebted" to Bell, and I am really not clear just how he means that).
In a sense, it hardly matters: important social thinkers have an impressive record of missing the point and still surviving to cast a shadow another day (think Marx, Hayek, Schumpeter). And Bell, for his part, was remarkably right in the sense that he rarely got lost in the commitments to the various insanities of his time. Weiss (again) calls him "a bit of Trotsky, a bit of Kropotkin, and heaping dollops of Mills and Weber tossed into the mix." He might have added "a bit of Montaigne." For that was the real essence of Bell: he was an appreciator who didn't drink the kool-aide with the satisfying result that he has less to be ashamed of than some of his more enthusiastic neighbors.
That Trotskyism, for example, was never more than "a bit." And later in life, when the Trotskyites became neo-Conservatives, Bell was a pains to tell people he wasn't a neo-conservative either. Weiss (yet again) has the most telling Bell story (though I am not quite sure Weiss got the point himself:
In a sense, it hardly matters: important social thinkers have an impressive record of missing the point and still surviving to cast a shadow another day (think Marx, Hayek, Schumpeter). And Bell, for his part, was remarkably right in the sense that he rarely got lost in the commitments to the various insanities of his time. Weiss (again) calls him "a bit of Trotsky, a bit of Kropotkin, and heaping dollops of Mills and Weber tossed into the mix." He might have added "a bit of Montaigne." For that was the real essence of Bell: he was an appreciator who didn't drink the kool-aide with the satisfying result that he has less to be ashamed of than some of his more enthusiastic neighbors.
That Trotskyism, for example, was never more than "a bit." And later in life, when the Trotskyites became neo-Conservatives, Bell was a pains to tell people he wasn't a neo-conservative either. Weiss (yet again) has the most telling Bell story (though I am not quite sure Weiss got the point himself:
When asked the symbolic question of the precise moment of his “split” with Marxism-Leninism, “Comrade, when was your Kronstadt?” -- a reference to the once pro-Bolshevik sailors who mutinied for food and pay and whom the Red Army mowed down like rabbits -- Bell’s reply was as simple as it was indicting of his entire radical cohort: “Kronstadt was my Kronstadt.”Lots more good Bell stuff in links collected by Arts & Letters Daily (which I shamelessly pilfer because I am afraid they will roll of the A&L front page and disappear): .. NY Times... Washington Post... The Chronicle... The Guardian... Slate... Boston Globe... National Post... Harvard Crimson... Michael Kazin... Frum Forum... Morris Dickstein...
Sunday, January 30, 2011
Why Wasn't I Informed?
I just learned today (from the NPR panel quiz, "Says You") that the song to get the most radio and TV play in the 20th Century (are you ready for this, folks?) "You've Lost that Lovin' Feelin'," first recorded by The Righteous Brothers. I fired up a YouTube version and I've decided I must have been living in a cave because I swear I never heard it before (I do recognize Phil Spector's Wall of Sound, though). Of the others in the top ten--okay, I recognize John Lennon and Paul McCartney's "Yesterday," but the only one that really sticks in my mind is Paul Simon's "Mrs. Robinson" (cu cu ca chew).
Of the brothers, I see that Bobby Hatfield is dead while Bill Medley is still performing, at Branson, MO. I wonder how much of the money trickled down to them and how much went to the suits.
Update: I see the song earlier made a list of "Least Appropriate Wedding Songs," at NPR, along with "Just a Gigolo" and "Lady is a Tramp." And don't miss the great comment from "fatbear" infra on how NPR and I both got spun on this one. Meanwhile, here's an un-righteous rendering:
Of the brothers, I see that Bobby Hatfield is dead while Bill Medley is still performing, at Branson, MO. I wonder how much of the money trickled down to them and how much went to the suits.
Update: I see the song earlier made a list of "Least Appropriate Wedding Songs," at NPR, along with "Just a Gigolo" and "Lady is a Tramp." And don't miss the great comment from "fatbear" infra on how NPR and I both got spun on this one. Meanwhile, here's an un-righteous rendering:
Stanley Fish on Sentences
I see that Stanley Fish has inaugurated and concluded his contest (over at Slate, link, link) to select great sentences from the English language. I didn't get around to entering partly because I couldn't think of a slam-dunk entry but also because I began to suspect that Fish's own enterprise had undercut himself. That is--of Fish's own five, I'd say that only two deserve the recognition he grants. And they would be the first two--one, from John Bunyan (1678):
In this light, I'm a little surprised that Fish passed over his own guiding light, John Milton. It may be that he intended to bypass poetry. But Milton, in addition to being a great poet, was also our greatest pamphleteer. And how can you improve on:
Exclusion of poetry might explain why we cannot use Shakespeare's "Love's not time's fool, though rosy lips and cheeks/Within his bending sickle's compass come" (The spondees! The spondees!). But Shakespeare too wrote prose also and here, there are almost too many choices. "What a piece of work is a man!" is part of an electrifying paragraph, although as a sentence it might qualify in its own right. Still if I had to choose just one, it might be:
Now he had not run far from his own door, but his wife and children perceiving it, began crying after him to return, but the man put his fingersAnd his second, only 26 years later, from Jonathan Swift (1704)
Last week I saw a woman flayed, and you will hardly believe how much it altered her appearance for the worse.The other three, which I won't trouble to reprint here, are elegant pieces of work in their own right and on their own terms. But none of them has the bite, power and drive of the great originals. By corollary, if we were really looking for sentences with the quality of these, I suspect we might go right back again to these originals--in particular Bunyan, the electricity and directness of whose prose has almost never been equalled. Fish's own choice is fine. But you could have done just as well with the very first sentence in the book:
As I walked through the wilderness of this world, I lighted on a certain place where was a Den, and I laid me down in that place to sleep: and, as I slept, I dreamed a dream.Or the second:
I dreamed, and behold, I saw a man clothed with rags, standing in a certainplace, with his face from his own house, a book in his hand, and a great burden upon his back.Or the third:
I looked, and saw him open the book, and read therein; and, as he read, he wept, and trembled; and, not being able longer to contain, he brake out with alamentable cry, saying, What shall I do?Or if that is too convoluted, a few sentences later, the short version:
Now, I saw, upon a time, when he was walking in the fields, that he was, as he was wont, reading in his book, and greatly distressed in his mind; and, as he read, he burst out, as he had done before, crying, What shall I do to be saved?But forget about Bunyan per se. I think it is no accident that his best examples comes from the relative youth of the language, before it had become as self-involved as it does in his later instances.
In this light, I'm a little surprised that Fish passed over his own guiding light, John Milton. It may be that he intended to bypass poetry. But Milton, in addition to being a great poet, was also our greatest pamphleteer. And how can you improve on:
Methinks I see in my mind a noble and puissant nation rousing herself like a strong man after sleep, and shaking her invincible locks; methinks I see her as an eagle mewinher mighty youth, and kindling her undazzled eyes at the full midday beam; purging and unscaling her long-abused sight at the fountain itself of heavenly radiance.[If you think I am cheating and giving two sentences, divided it before the second "methinks" and use either half.]
Exclusion of poetry might explain why we cannot use Shakespeare's "Love's not time's fool, though rosy lips and cheeks/Within his bending sickle's compass come" (The spondees! The spondees!). But Shakespeare too wrote prose also and here, there are almost too many choices. "What a piece of work is a man!" is part of an electrifying paragraph, although as a sentence it might qualify in its own right. Still if I had to choose just one, it might be:
There live not three good men unhanged in England; and one of them is fat and grows old.Going on in the same vein, I see that at least one of Fish's winning entries comes from the Bible--more precisely the King James Version, another product of the language's raw youth. And so it goes: it is the language fashioned by Bunyan and Swift, and Shakespeare and Milton and the Bible, that we speak today and nothing in the later elaboration can really top the beginning. The best one can do is to try to match that beginning; then you may hope to come up with something like what may truly be the best single sentence in the English language:
With malice toward none, with charity for all, with firmness in the right as God gives us to see the right, let us strive on to finish the work we are in, to bind up the nation's wounds, to care for him who shall have borne the battle and for his widow and his orphan, to do all which may achieve and cherish a just and lasting peace among ourselves and with all nations.
Mrs. Buce Notes a Remarkable Instance
Of Generosity on the Part
Of Our Former President
Scott McClellan, George W. Bush's former press secretary, has long since burned his bridges with his old boss, and now the former president returns the favor. In Bush's memoir, Decision Points, McClellan does not appear:
...Mr. Bush said Mr. McClellan was irrelevant.Well, that's a kindness, says Mrs.Buce. He's saying that none of it was Scott's fault.
“He was not a part of a major decision. This is a book about decisions. This isn’t a book about, you know, personalities or gossip or settling scores. I didn’t think he was relevant.”
Saturday, January 29, 2011
Wallison on "The Market"
William K. Black does a superb job of deconstructing the work of Peter Wallison and his almost childlike faith in "the market," never better expressed in this line:
There amay have been a time when we were so culturally isolated that we couldn't fully comprehend the point. We've way outgrown that kind of naivete now. We have the work of, e.g.,Milhaupt and Pistor
greart range of meanings of the term "corporation;" Ian Bremmer,
on how infinitely various are the definitions of the public-private divide; Dani Rodrik
on the circuitous and varied paths to "development"--how almost none honors the standard model and how most can be best described as a matter of accident. Oh, and yes, we have our own Hyman Minsky
to show us how our own model of a "market" m ay itself harbor the seeds of its own destruction. To erect "the market" as a talisman in a world of such variety and complexity simply cannot be taken seriously; it has far less to do with adult discourse than with a infantile invocation of magic.
If the business of banking is inherently unstable, it would long ago have been supplanted by a stable structure that performs the same functions without instability.Hoo boy. If there is a problem, the market would have solved it. I can't top Black in his particular explanation of why this remark is so goofy, but I would generalize and make it a bit more abstract. The point is that there is not now and never has been such a thing as the market. Markets (like governments) are cultural artifacts, created out by humans out of a whole range of possibilities some half-forgotten, others half-remembered, most lost in a substrate of inarticulate presumption invisible even--or most of all--to the person who relies on them.
There amay have been a time when we were so culturally isolated that we couldn't fully comprehend the point. We've way outgrown that kind of naivete now. We have the work of, e.g.,Milhaupt and Pistor
greart range of meanings of the term "corporation;" Ian Bremmer, on how infinitely various are the definitions of the public-private divide; Dani Rodrik on the circuitous and varied paths to "development"--how almost none honors the standard model and how most can be best described as a matter of accident. Oh, and yes, we have our own Hyman Minsky to show us how our own model of a "market" m ay itself harbor the seeds of its own destruction. To erect "the market" as a talisman in a world of such variety and complexity simply cannot be taken seriously; it has far less to do with adult discourse than with a infantile invocation of magic.
Friday, January 28, 2011
Are Bankers a Bunch of Greedy Bastards?
Well, are they? Raghuram Rajan thinks not, or not especially, or not really more than the rest of us. It's the system:
. It's a beguiling thought and the whole book bears careful reflection. But I think here he may be overlooking selection bias: the fact the kiddies who assault the purlieus of the great banks are the ones most at home with these kind of constraints, least in need of conditioning to the new déformation professionnelle. And if they aren't that way coming out of the box, what is the purpose of an MBA program except to school them in this kind of studied indifference?
It is not that bankers are excessively greedy. ... Rather, their willingness gto exploit any advantage that will help them make money, however dodgy (albeit legal) it m ay be, stems partly from the nature of competitive banking, where there are few easy opportunities to make money, and partly from the way banker performance is measured--almsot exclusively by how much money the banker makes rather than by her impact on real activity. The disconnect between banking and real lives and livelihoods is most apparent in arm's-length financial systems that are found in countries like the United States and the United Kingdom.Rajan, Fault Lines
A second lesson is that bankers invariably find the biggest edge in taking advantage of unsophisticated players or players who do not have the same incentive to make money,. Clearly, individuals who are unschooled in finance are a potential target, but often these individuals realize their ignorance and give their custom only to trusted intermediaries. Moreover, they typically have too little money to be of interest to the smartest bankers. More attractive targets are the moderately schooled managers of large pools of funds, such as pension funds or foreign state-owned funds, who know not that they know not and are thus easily taken advantage of. But perhaps the most attractive target of all is the government itself. The government has nonmarket, noneconomic objectives, and however astute its representatives may be, these make it easy prey for clever bankers. Moreover, whereas a naive individual is soon relieved of all his money, the government has deep pockets, and exploiting them can sustain many a banker's luxurious lifestyle for a long time.
Third, banker behazvior tends to be self-reinforcing, at least for a while. ... This behavior can exaggerate investment trends and move prices far away from fundamentals. Early movers may convince themslves they are geniuses, even though they are only the leaders of a herd that is rapidly headed toward a cliff. ...
Finally, there is safety in numbers, because the responsible government cannot let all its bankers fail, given the likely collateral damage to the citizens.
. It's a beguiling thought and the whole book bears careful reflection. But I think here he may be overlooking selection bias: the fact the kiddies who assault the purlieus of the great banks are the ones most at home with these kind of constraints, least in need of conditioning to the new déformation professionnelle. And if they aren't that way coming out of the box, what is the purpose of an MBA program except to school them in this kind of studied indifference?
Duncan Hunter Pedals it All Over Town
I see that Duncan Hunter thinks that Federal spending on bike paths is unconstitutional because people go biking for pleasure. He might be onto something: our national ancestors were notoriously anti-pleasure. Macaulay said that "the puritan hated bear baiting, not because it gave pain to the bear, but because it gave pleasure to the spectators." so here.
But Zaid Jilani points out that many people ride bikes to work. He might have added that some people drive their cars for something other than dreary work. Looks like we're going to need a lost more cops out there on the Interstate to make sure no one is using their Federal tax dollars to have fun.
But Zaid Jilani points out that many people ride bikes to work. He might have added that some people drive their cars for something other than dreary work. Looks like we're going to need a lost more cops out there on the Interstate to make sure no one is using their Federal tax dollars to have fun.
College Grads: Not Doing So Badly
I suppose this is old news to anyone who pays attention but it is new news to me. We stew about 9/15/25 (depending what you count) unemployment rates but unemployment for college grads is actually quite low--4.8 percent in December 2010 according to the Bureau of Labor Statistics, compared to 9.8 for high school grads and 15.3 percent for those without high school diploma. That's all college grads I'm talking about, not just the post-adolescent you are trying to get out of the guest room. And it doesn't say a lot about job quality: I wouldn't be surprised if there are a fair number of former mortgage brokers out there waiting tables or cutting hair and happy to have it thankyouverymuch. I suppose it is one more thread for the mantra of how this is a skill-based society. I suppose so but I still remember what a prospective non-employer told me back when I was a college dropout: it's not what you learn in college, it's just that completing college is proof of at least a certain minimum of staying power--also, perhaps, skill at outwitting a heartless bureaucracy.
I haven't seen any data on young college grads in particular. I should think this would be particularly hard to measure, seeing as how a fair number of the kiddies just don't get their act in gear until months, maybe a year or two, after they walk across the stage (gotta be time for the World Tour or at least one more scarf-down of mom's cooking before you embark on the great adventure. I suppose also lot of he young get crap jobs and that's fine--really, that's what the young should be for. Question is how long will they be stuck in those crap jobs? Will "it's only until I find something real" turn into 25th anniversary lunch at Chili's with all your lucky-to-be-employed-at-all college graduate buddies?
I haven't seen any data on young college grads in particular. I should think this would be particularly hard to measure, seeing as how a fair number of the kiddies just don't get their act in gear until months, maybe a year or two, after they walk across the stage (gotta be time for the World Tour or at least one more scarf-down of mom's cooking before you embark on the great adventure. I suppose also lot of he young get crap jobs and that's fine--really, that's what the young should be for. Question is how long will they be stuck in those crap jobs? Will "it's only until I find something real" turn into 25th anniversary lunch at Chili's with all your lucky-to-be-employed-at-all college graduate buddies?
Thursday, January 27, 2011
No Wait, Maybe Things Aren't That Different After All
Just in from Davos:
But if wives have it bad, mistresses, who are invited under a variety of guises and usually wind up with a white name tag, have it worse. Typically their men are swallowed up by a tsunami of meetings and interviews and don’t have the time or inclination to take their mistresses around with them. Often these men go to high-level dinners to which wives and mistresses are not invited. The skinny and beautifully dressed Davos Mistress typically hangs around the auditoriums waiting for a couple of minutes with her man. While waiting, she keeps her eyes peeled looking to search and destroy the competition.
The only thing worse than a white pass, is no pass. Rumor has it (heard first-hand from more than one jealous Davos Mistress) that there are legions of women — let’s call them the aspiring mistresses — who do not get a coveted Davos invitation and badge and so can not enter the Congress Centre but who come anyway. They book a hotel room and prowl the streets hoping to snare their prey. They are the worst enemies of the Davos Mistress.
Link. Thanks, John.
Wednesday, January 26, 2011
The Subsidy Lady
As Steve Benen (channeling Politico) so ably pointed out yesterday, there is a glaring hole in the Republican phalanx against Federal spending. You probably knew: it's farm subsidies, and no wonder: just as libertarian Rand Paul M.D. has shown not the slightest interest in cutting medicare payments, so the staunch defenders of budgetary rectitude apparently can't think of a penny that they would clip off this particular cash cow. Back in the 60s, there were some tax-cutters in Congress who wanted to propose a cap on per-farmer subsidies of--I think maybe the number was $100k, still pretty serious bucks in that simpler time. The whole point was to embarrass the sponsors into showing they were so in the tank for the farm lobby that the couldn't accept even a hint of compromise on the issue. Of course these guys do not embarrass easily and the project languished.
If grudging fairness, I should acknowledge that some of the conservative think tanks have been pretty good on this one: see, e.g., link, link. (or were; both these links are going on four years old). Maybe they understand it is all a charade.
Oddly enough, there does seem to be at least one Republican who appears willing to speak about farm subsidies. I'm not sure whether this is serious, or a charade, or more evidence that she's batshit looney. Do I dare suggest her name? You'd think her enthusiasm might be at least tempered by the fact that she's apparently a pretty goodsized recipient of farm subsidies herself, but still.
If grudging fairness, I should acknowledge that some of the conservative think tanks have been pretty good on this one: see, e.g., link, link. (or were; both these links are going on four years old). Maybe they understand it is all a charade.
Oddly enough, there does seem to be at least one Republican who appears willing to speak about farm subsidies. I'm not sure whether this is serious, or a charade, or more evidence that she's batshit looney. Do I dare suggest her name? You'd think her enthusiasm might be at least tempered by the fact that she's apparently a pretty goodsized recipient of farm subsidies herself, but still.
The Exemptions Howler Again (With Walkback)
[Caution, walkback: on sober reconsideration, I think my critics, infra, are largely right. I'll let the original post stand, so as not to be seen as hiding anything. But see the comments below.]
Every so often I read something in a field I know something about that seems so wildly, flatly, gobsmackingly wrong that I figure I must be missing something [update: yes, I think I was]. Today is one of these days.
Here's a paper over at Vox EU, a website which calls itself "Research-based policy analysis and commentary from leading economists." The title of the post is "Is the US bankruptcy code to blame for overinvestment in housing by US households?" You can tell where this one is going--the answer to the question posed will be "yes." But are you ready for this:
Citing other research, the authors also declare that "the homestead exemption increases the supply of housing credit [and] biases household investment towards home equity." Huh? They are saying that home owners borrow more because they enjoy exemption protection? But even if they did enjoy exemption protection (they don't) --wouldn't we have to assume that the lender, too, knows about the homestead right? Are they really telling us that the lenders stand mesmerized before the predatory borrowers and agree to lend the money even though they know they will have no right to get it back? If this is truly their finding, don't they owe us just a hint of a surmise as to what would cause such bizarre behavior?
I'm really not sure where the authors got a screwed-up notion about the nature of the home equity exemption; it might have come from Rajan and Zingales in this book, where R and J make the same crude blunder. I tried to demolish R and J's error here, but I guess rust never sleeps.
A final thought: I just noticed that all four co-authors seem to be associated with European institutions. That might explain their utter ignorance of American law. And does it suggest that in Europe I can protect against a mortgage with a homestead exemption? Where do I sign up?
--
I notice at least one more crude misunderstanding; although it is less important it does provide additional evidence as to just how unencumbered by actual knowledge this piece is. They say:
Every so often I read something in a field I know something about that seems so wildly, flatly, gobsmackingly wrong that I figure I must be missing something [update: yes, I think I was]. Today is one of these days.
Here's a paper over at Vox EU, a website which calls itself "Research-based policy analysis and commentary from leading economists." The title of the post is "Is the US bankruptcy code to blame for overinvestment in housing by US households?" You can tell where this one is going--the answer to the question posed will be "yes." But are you ready for this:
At the same time, the legal system favours homeowners who experience financial difficulties by making investments in home equity partially exempt from personal bankruptcy.People--especially my bankruptcy buddies--help me out here. Isn't this just a dumb-as-pig-iron schoolboy howler? When they say "investments in home equity," I assume they are talking about mortgage debt, secured debt, yes? [In context, I think this must be what they have in mind--and does anyone intentionally ever make an unsecured loan in home equity?] But repeat after me: the homestead exemption is not good against mortgage debt. You can't claim it, you can't rely on it, In Sam Goldwyn's two words, ir-relevant. So the homestead exemption can have nothing to do with "investment in home equity."
Citing other research, the authors also declare that "the homestead exemption increases the supply of housing credit [and] biases household investment towards home equity." Huh? They are saying that home owners borrow more because they enjoy exemption protection? But even if they did enjoy exemption protection (they don't) --wouldn't we have to assume that the lender, too, knows about the homestead right? Are they really telling us that the lenders stand mesmerized before the predatory borrowers and agree to lend the money even though they know they will have no right to get it back? If this is truly their finding, don't they owe us just a hint of a surmise as to what would cause such bizarre behavior?
I'm really not sure where the authors got a screwed-up notion about the nature of the home equity exemption; it might have come from Rajan and Zingales in this book, where R and J make the same crude blunder. I tried to demolish R and J's error here, but I guess rust never sleeps.
A final thought: I just noticed that all four co-authors seem to be associated with European institutions. That might explain their utter ignorance of American law. And does it suggest that in Europe I can protect against a mortgage with a homestead exemption? Where do I sign up?
--
I notice at least one more crude misunderstanding; although it is less important it does provide additional evidence as to just how unencumbered by actual knowledge this piece is. They say:
The US bankruptcy exemption for home equity, or homestead exemption, ranges from $0 in Maryland to an unlimited amount in eight US states, including Florida and Texas, in 2006.Any first-semester bankruptcy student can tell you they are stepping on their own shirttails here. In fact, there are two separate exemption systems--"bankruptcy" and "state." Any debtor always has his state exemptions (zero to infinity as the authors correctly state). The Bankruptcy Code says that the debtor in bankruptcy may instead choose a set of "bankruptcy" exemptions--but the Bankruptcy Code also allows individual states to opt out of the bankruptcy system; in fact about three quarters of all states have opted out. FWIW, the current "bankruptcy exemption" is $21,625,sometimes $22,775,
Tuesday, January 25, 2011
Just Gimme the Blue
I see the American Bankruptcy Institute hypes its case reporting service as "all the good parts marked." Reminds me of the late Roger Price who used to say he wanted his books not in "expurgated" editions and not in "unexpurgated." He wanted the "purgated" edition, the one where the publisher underlined all the dirty words in blue pencil.
What I Might have Said about Vallejo
I spent a pleasant hour yesterday chatting with a reporter about the Vallejo Chapter 9, the flagship (or Judas goat?) among municipal bankruptcies. The immediate hook is that Vallejo has proposed a plan; there's a hearing set on the disclosure statement for March 7. After (if) the city gets court approval on the disclosure statement it can solicit consents and then count the ballots. If it gets the right number of votes, it can ask the court to bless it, and if the court blesses the plan, then the plan becomes law--a kind of "judicial contract" to supplant whatever contract obligtions it bore when it came into the case.
Two things strike me in the plan: one, the employees sure are taking a big hit on their pre-BK claims--the papers are saying 20c on the dollar if they are luck. And two, the utter absence of any attempt to take on CalPers, the big California pension fund.. I suppose I can understand that the reluctance of the one little city (of 100,000+) to tackle the massive CalPers--evidently CalPers has made it clear that it regards itself as the protector of retiree rights and that it will fight tooth & toenail to make sure they are not impaired. But if no individual city has the right incentives to make a fight, will CalPers win by default? (For perspective--I gather retirees will take a huge hit on health care).
The other eye-popping point is the matter of how much of the haircut is being borne by newer, usually younger, employees at the expense of their seniors. Might make for some moments of rancor in the squad car or on the fire line.
I'm an old guy and I do get a sense I've seen all this before. That old/young split: they did it with pilots back in the early days of deregulation. Pilots used to get paid like doctors; the younger ones are lucky if they get paid like bus drivers.
And that whole rejection-of-labor-contract thingy: didn't we see this all back in the 80s with airlines, with meat packing, with steel? My take back them was that the unions just didn't believe it could happen to them until it did happen to them--now public employees are getting the same lesson. I don't mean to show contempt for the working man here: one, I'm enjoying my own public pension and two, I am soo glad I don't have to put on a uniform and hit the streets of Vallejo every morning.
People are talking about more municipal bankruptcies to come but I am skeptical: the city's success in the Vallejo case will likely lead to fewer rather than more public entity bankruptcies: once the public employee groups see what really can happen to them in bankruptcy, they may decide that it just not cost effective to fight the issue.
I also agree with my friend Ignoto who says Vallejo is a pretty good argument in favor of electing city officials for life so they have to clean their own poo off the carpet.
Two things strike me in the plan: one, the employees sure are taking a big hit on their pre-BK claims--the papers are saying 20c on the dollar if they are luck. And two, the utter absence of any attempt to take on CalPers, the big California pension fund.. I suppose I can understand that the reluctance of the one little city (of 100,000+) to tackle the massive CalPers--evidently CalPers has made it clear that it regards itself as the protector of retiree rights and that it will fight tooth & toenail to make sure they are not impaired. But if no individual city has the right incentives to make a fight, will CalPers win by default? (For perspective--I gather retirees will take a huge hit on health care).
The other eye-popping point is the matter of how much of the haircut is being borne by newer, usually younger, employees at the expense of their seniors. Might make for some moments of rancor in the squad car or on the fire line.
I'm an old guy and I do get a sense I've seen all this before. That old/young split: they did it with pilots back in the early days of deregulation. Pilots used to get paid like doctors; the younger ones are lucky if they get paid like bus drivers.
And that whole rejection-of-labor-contract thingy: didn't we see this all back in the 80s with airlines, with meat packing, with steel? My take back them was that the unions just didn't believe it could happen to them until it did happen to them--now public employees are getting the same lesson. I don't mean to show contempt for the working man here: one, I'm enjoying my own public pension and two, I am soo glad I don't have to put on a uniform and hit the streets of Vallejo every morning.
People are talking about more municipal bankruptcies to come but I am skeptical: the city's success in the Vallejo case will likely lead to fewer rather than more public entity bankruptcies: once the public employee groups see what really can happen to them in bankruptcy, they may decide that it just not cost effective to fight the issue.
I also agree with my friend Ignoto who says Vallejo is a pretty good argument in favor of electing city officials for life so they have to clean their own poo off the carpet.
Monday, January 24, 2011
Bankruptcy to the Rescue
I'm wholly in sympathy with Alan White over at Credit Slips as he evaluates the proposal that we allow states to take bankruptcy:
Come to think of it, what ever became of Anna Kreuger's proposal that we fashion a bankruptcy law for sovereign nations, floated via the great individualists down at Cato?
Idle afterthought: I do think it's a good joke that the idea of extending power to states is favored by the same crowd that gave us Seminole Tribes and its kindred, purporting to prove that any Federal interference with state state sovereignty was a crime against humanity. See, e.g., link.
Obviously, these Republicans' agenda is to shift credit crisis losses from state taxpayers to public sector union employees, consistent with their efforts to shift auto industry losses to workers in that industry. Bankruptcy reform for homeowners is anathema, because it shifts losses from middle class people to banks and institutional investors. It is unclear how bankruptcy for the states could be used to stiff union pension funds without also wreaking havoc with the bond market, and bond investors would normally be a favored Republican constituency. For this reason, other conservatives are not so crazy about this idea. Presumably, any legislative proposals for Chapter 9.5 would carefully craft priorities for favored constituencies.He could pose this one as a pendant to the proposal pushed by the California Professional Firefighters last year that would require state approval before a city could file bankruptcy. Just as the "state bankruptcy" proposal looks like an effort to beat up on public employees (and their unions), I take it the "limit city bankruptcy" proposal is an an attempt to give the unions more cover. I can imagine a world in which they both succeed.
Come to think of it, what ever became of Anna Kreuger's proposal that we fashion a bankruptcy law for sovereign nations, floated via the great individualists down at Cato?
Idle afterthought: I do think it's a good joke that the idea of extending power to states is favored by the same crowd that gave us Seminole Tribes and its kindred, purporting to prove that any Federal interference with state state sovereignty was a crime against humanity. See, e.g., link.
I Found My Suit
Underbelly junkies will recall that I have been leading a peripatetic life in my post retirement phase as I squat in various otherwise temporarily vacant offices. This weekend I was trying to organize my clothes and I counted only two suits. That's funny, I thought I owned three suits: one for the funeral*, one for any possible indictment and one to wear to class. What happened to the third suit?
Wait a minute, folks, here it is--right on the peg in my friend Dan's office, just where I left it last, um, must have been last April. But I don't suppose I was wearing a suit in April in this Mediterranean climate anyway. So the natural order has been restored. Though it does make me wonder how many garments I have left trailing behind in how many other offices before I got here.
*I jest. As far as I'm concerned it is okay if they leave me out for the buzzards and I don't think they want cloth anyway.
Wait a minute, folks, here it is--right on the peg in my friend Dan's office, just where I left it last, um, must have been last April. But I don't suppose I was wearing a suit in April in this Mediterranean climate anyway. So the natural order has been restored. Though it does make me wonder how many garments I have left trailing behind in how many other offices before I got here.
*I jest. As far as I'm concerned it is okay if they leave me out for the buzzards and I don't think they want cloth anyway.
Sunday, January 23, 2011
How Goldman Wins the Battle at Facebook Gulch
Review the bidding:Goldman Sachs (and a partner) offered to pay $500 million for a slice of Facebook which the press tells us implies a total valuation for the company of $50 billion. Goldman says it intends to flog offer the stock to a small circle of friends. Then poor timorous Goldman says no wait, we might get in trouble the bureaucrats; we'll offer it only to investors overseas. Jonathan Macey blames the bullies in Washington and calls it "The SEC's Facebook Fiasco." Macey does have the good grace to concede that Goldman doesn't lose a penny by its shift of strategy, but I'll go a step further: for Goldman I'd call it a big win.
For starters, I haven't noticed anybody explaining just how $500 mill translates into $50 bill, but I suppose it goes like this: 500m/50b = 0.01 = one percent. Goldman is buying one percent of Facebook (yes?), so the whole business must be 500m/0.01. Yes? Well: yes if we assume a flat demand curve; if, that is, we assume that all shares of Facebook would sell for the price of each share of Facebook.
Of course we won't know because nobody is offering to sell all of Facebook, and will no until sometime a lot closer to the next ice age. What it does do is ramp up the hubba hubba around what is already the hottest current property on the investment scene.
I know memories are short but isn't this beginning to sound a lot like the forces that drove the dot-com bubble in the 90s? You'd hype the stock, you'd have your "public" offering, but then nobody would be able to find any shares. You'd actually release five, maybe 10, percent of all shares. So everybody is avid for a product that very nearly does not exist. The consequence is that you capture the most optimistic investors at the highest possible price. Everyone else is left just kicking themselves that they didn't get a piece and just aching for the day when the finally get to climb on board.
So what have we get here? Small (indeed, tiny) float, check; agressive hype ($50 billion!) and an old-fashioned barrel-house tease (C'mon you know you want it! Oops, you can't have it just yet! Watch while somebody else has some fun!).
Of course I haven't a clue precisely what will happen next. I'm assuming public offering. I'm assuming a blaze of publicity. I'll bet any number of these first-round investors will come climbing over the bodies of their grandmothers to get in the second chance. And one way or another, I'm assuming that Goldman will be there at every juncture, its palm open and out and on its face a contented grin.
For starters, I haven't noticed anybody explaining just how $500 mill translates into $50 bill, but I suppose it goes like this: 500m/50b = 0.01 = one percent. Goldman is buying one percent of Facebook (yes?), so the whole business must be 500m/0.01. Yes? Well: yes if we assume a flat demand curve; if, that is, we assume that all shares of Facebook would sell for the price of each share of Facebook.
Of course we won't know because nobody is offering to sell all of Facebook, and will no until sometime a lot closer to the next ice age. What it does do is ramp up the hubba hubba around what is already the hottest current property on the investment scene.
I know memories are short but isn't this beginning to sound a lot like the forces that drove the dot-com bubble in the 90s? You'd hype the stock, you'd have your "public" offering, but then nobody would be able to find any shares. You'd actually release five, maybe 10, percent of all shares. So everybody is avid for a product that very nearly does not exist. The consequence is that you capture the most optimistic investors at the highest possible price. Everyone else is left just kicking themselves that they didn't get a piece and just aching for the day when the finally get to climb on board.
So what have we get here? Small (indeed, tiny) float, check; agressive hype ($50 billion!) and an old-fashioned barrel-house tease (C'mon you know you want it! Oops, you can't have it just yet! Watch while somebody else has some fun!).
Of course I haven't a clue precisely what will happen next. I'm assuming public offering. I'm assuming a blaze of publicity. I'll bet any number of these first-round investors will come climbing over the bodies of their grandmothers to get in the second chance. And one way or another, I'm assuming that Goldman will be there at every juncture, its palm open and out and on its face a contented grin.
Beware #38-2047-008
"Some assembly required" warning: coffee table #38-0247-008 from American Furniture Alliance--the table is okay, but the assembly instructions made the quarter finals in the East Asian hardware fiction stakes. The bolt holes where you are supposed to secure the legs--they are dead ends, and the receptors are too tight for the barrel nuts. By contrast you set the bolts in four entirely different holes that don't show on the specs. It works once you figure that for yourself, and following the obligatory trip to the hardware store for the 10-cent barrel nut, now ensconced for eternity in the wrong hole.
How these people expect to become the currency of last resort when they can't even identify the bolt holes right is beyond me. Table seems okay, though. A bit heavy, but now I have one more place to dump stuff.
How these people expect to become the currency of last resort when they can't even identify the bolt holes right is beyond me. Table seems okay, though. A bit heavy, but now I have one more place to dump stuff.
Eh, You Only Live Once...
Onion News Network (H/T John) reports:
Somewhat to my surprise, my pal hesitated. "He'd be an interesting President," he said at last. "For another country. A small country. Like Belgium. With no nukes."
Lyndon Johnson used to say that he was afraid of John Connally. Wonder what Mitt Romney thinks of Sarah Palin.
A recent poll shows 62% of Americans say they don't want to vote for Palin, but kinda just have to see what would happen.Makes me think of 1979 when I was visiting at the University of Texas. One of my colleagues-I forget his name--was as nice guy, good company but somewhat to the right of Ivanhoe. The topic arose, who would the Republicans nominate in '80? By way of outreach I suggested--how about John Connally?
Somewhat to my surprise, my pal hesitated. "He'd be an interesting President," he said at last. "For another country. A small country. Like Belgium. With no nukes."
Lyndon Johnson used to say that he was afraid of John Connally. Wonder what Mitt Romney thinks of Sarah Palin.
Saturday, January 22, 2011
Vampire Invades New Zealand!
Either that, or they're coping with an ardent 15-year-old:
Link. Comments are kinda cute too. Well, yes, vulgar and childish but kinda cute.
Woman paralyzed by hickey
Link. Comments are kinda cute too. Well, yes, vulgar and childish but kinda cute.
Nino says: Hey Lookie Me!
Jonathan Turley has a shrewd offering up at the Washington Post this morning on Antonin Scalia as a media celebrity. The piece is fine on its own footing but let me ask and answer a related question: what in the hell ever possessed this guy to act in such an unseemly manner now that he's winning--now that the conservatives are doing so much better than they did in his early years?
My guess: he doesn't like being upstaged. In the early years he could do his crossfire act from his perch on the far right and be guaranteed a fair amount of media attention. Now he's got to cope with--no not Sotomayor and Kagan but Roberts and Alito, who are more disciplined and effective plus (let's face it) a good deal smarter than Scalia. He could dump his contempt on the likes of Souter and Blackmun when they betrayed his conception of a majority. Where to park his bile when his side wins? In short, the court itself isn't as much fun any more. A guy who is famished for adulation just has to look elsewhere. Next up: runway modeling.
My guess: he doesn't like being upstaged. In the early years he could do his crossfire act from his perch on the far right and be guaranteed a fair amount of media attention. Now he's got to cope with--no not Sotomayor and Kagan but Roberts and Alito, who are more disciplined and effective plus (let's face it) a good deal smarter than Scalia. He could dump his contempt on the likes of Souter and Blackmun when they betrayed his conception of a majority. Where to park his bile when his side wins? In short, the court itself isn't as much fun any more. A guy who is famished for adulation just has to look elsewhere. Next up: runway modeling.
Veterans' Health Care and the True Costs of War
Way back in my brief and derisory soldier days, I witnessed the phenom of a young man who somehow put a bayonet through his foot. They took him to a military doctor--another young man, this one presumably with good skills but a rotten attitude: he hated everything about the Army. "Son," said the doctor to the soldier, "the army got you into this mess, and the Army's gonna pay..."
Sounds like Danny Zwerdling from NPR has got himself (together with ProPublica) a nice story about the military perhaps fudging on the benefits of aftercare for military brain injuries because it isn''t too eager to pay the cost of aftercare for military brain injuries. At least he has caught the attention of Senator Claire McCaskill who apparently thinks the story has legs enough to justify a Congressional hearing.
Yes, yes, I know this may turn out to be just the gleam in a reporter's eye but it does occur to me: in counting the costs of a war, you would want to count the cost of all damage inflicted on soldiers (and, hey, civilians) whether or not we own up to liability for that cost, not so? If the military pays it, that's a cost. If the military doesn't pay, and the patient pays, that's still a cost. If the militasry doesn't pay and the patient can't pay, that's still a cost, not so? And if nobody pays because there is no potentially effective treatment and thevictim brave American hero just languishes, that, too, would be a cost, yes?
Afterthought: recall my rotten-attitude doctor. I'm sure a major source of his ill humor was that he was limping along on Army wages (he was a de facto draftee) when he could have been out knocking back the big bucks. I'm sure he counted that as a cost.
Sounds like Danny Zwerdling from NPR has got himself (together with ProPublica) a nice story about the military perhaps fudging on the benefits of aftercare for military brain injuries because it isn''t too eager to pay the cost of aftercare for military brain injuries. At least he has caught the attention of Senator Claire McCaskill who apparently thinks the story has legs enough to justify a Congressional hearing.
Yes, yes, I know this may turn out to be just the gleam in a reporter's eye but it does occur to me: in counting the costs of a war, you would want to count the cost of all damage inflicted on soldiers (and, hey, civilians) whether or not we own up to liability for that cost, not so? If the military pays it, that's a cost. If the military doesn't pay, and the patient pays, that's still a cost. If the militasry doesn't pay and the patient can't pay, that's still a cost, not so? And if nobody pays because there is no potentially effective treatment and the
Afterthought: recall my rotten-attitude doctor. I'm sure a major source of his ill humor was that he was limping along on Army wages (he was a de facto draftee) when he could have been out knocking back the big bucks. I'm sure he counted that as a cost.
Friday, January 21, 2011
A Table Puzzle
Here's another I picked up from the BBC. It's a two-parter, and we are told that men and women will answer differently. So far I have tried it on one subject, a woman, and she did indeed answer in the predicted feminine form. So
- Part one: you're sitting at a four-legged table. The table wobbles; i.e., one leg is too short. What do you do?
- Part two: same problem, except it is a three legged table. What do you do?
Finance; The Three-mile Island Analogy
The most concise thing I can say about Richard Bookstaber's A Demon of Our Own Design is that I'm sorry I didn't read it when it first came out back in 2007. It's an imperfect book--a not-always-successful mix of investment anecdote (good, but not distinctive) together with some of the best analytical exposition of investment risk management that I've seen anywhere.
I particularly liked his chapter on "Complexity, Tight Coupling, and Normal Accidents," where he builds a model of financial meltdown on analogy to physical disasters such as the Three Mile Island and the incineration of the Challenger space shuttle. Both categories, he argues, embody instances of small errors magnified: "the components of a process are critically interdependent; they are linked with little room for error or time for recalibration or adjustment." Note: not merely "complex." The post office is complex. A university is complex. But a lost letter does not paralyze the mail service, and a screwup in the French department is not likely to resonate over in genetics. On the other hand, take something like Three Mile Island (or the Challenger) and you've got a system that can magnify the simplest ("normal") errors up to the edge (at least) of catastrophe.
It's a compelling argument and I can't do it justice here; it was made not less memorable because I read at 3 am when I couldn't sleep. Having my file of nightmarish calamity, I idled over to the computer to distract myself with my news aggregator. And what is the first thing I see? Why lookie, here' Tim Harford at Slate. And here's his headline for the day:
I particularly liked his chapter on "Complexity, Tight Coupling, and Normal Accidents," where he builds a model of financial meltdown on analogy to physical disasters such as the Three Mile Island and the incineration of the Challenger space shuttle. Both categories, he argues, embody instances of small errors magnified: "the components of a process are critically interdependent; they are linked with little room for error or time for recalibration or adjustment." Note: not merely "complex." The post office is complex. A university is complex. But a lost letter does not paralyze the mail service, and a screwup in the French department is not likely to resonate over in genetics. On the other hand, take something like Three Mile Island (or the Challenger) and you've got a system that can magnify the simplest ("normal") errors up to the edge (at least) of catastrophe.
It's a compelling argument and I can't do it justice here; it was made not less memorable because I read at 3 am when I couldn't sleep. Having my file of nightmarish calamity, I idled over to the computer to distract myself with my news aggregator. And what is the first thing I see? Why lookie, here' Tim Harford at Slate. And here's his headline for the day:
Three Mile Island, the Challenger Shuttle, and…Lehman Bros.?
Well, how about that. Of course the "Lehman" stuff was new--when Bookstaber published Demon, Lehman hadn't happened. But aside from that--yes, I had the privilege of reading essentially the same argument a second time. No mention of Bookstaber here so far as I can tell, Harford does say "The connection between banks and nuclear reactors is not obvious to most bankers." The "most" is a shrewd qualifier: at least one banker seems to know about it, enough to have written about it four years ago.
. Bookstaber also citesa study by Scott Sagan entitled The Limits of Safety
; he says that "these two books provide the details and examples that are the basis of the discussion in this chapter. I'm not clear whether either of these books discusses financial markets (I've seen only Google Books snippets, which are inconclusive). Harford does attribute some remarks on finance to Perrow, though they sound like the may have come from an interview, not from a book.
Is anybody copying anybody here? Aside from citations to Perrow, cited by all three finance writers, it's hard to say. Maybe Surowiecki heard it at a dinner party. Maybe Harford ran into Perrow at an academic conference. Maybe there's an ur-source that underlies them all. One way or another: "normal accidents" and financial meltdown: by this time, they're yoked for eternity.
Update: My friend John reminds me that Steve Schwarcz from Duke has been writing about "tight coupling," with credit to Bookstaber. See, e.g., link.
Well, how about that. Of course the "Lehman" stuff was new--when Bookstaber published Demon, Lehman hadn't happened. But aside from that--yes, I had the privilege of reading essentially the same argument a second time. No mention of Bookstaber here so far as I can tell, Harford does say "The connection between banks and nuclear reactors is not obvious to most bankers." The "most" is a shrewd qualifier: at least one banker seems to know about it, enough to have written about it four years ago.
And it turns out these two aren't alone. Later in the day, my attention was directed to James Surowiecki's "Financial Page" in The New Yorker for February 11, 2008:
In that sense, the potential collapse of monoline insurers looks like a classic example of what the sociologist Charles Perrow called a “normal accident.” In examining disasters like the Challenger explosion and the near-meltdown at Three Mile Island, Perrow argued that while the events were unforeseeable they were also, in some sense, inevitable, because of the complexity and the interconnectedness of the systems involved. When you have systems with lots of moving parts, he said, some of them are bound to fail. And if they are tightly linked to one another—as in our current financial system—then the failure of just a few parts cascades through the system. In essence, the more complicated and intertwined the system is, the smaller the margin of safety.
Today, as financial markets become ever more complex, these kinds of unanticipated ripple effects are more common ... . In the past thirty years, thanks to the combination of globalization, deregulation, and the increase in computing power, we have seen an explosion in financial innovation. This innovation has had all kinds of benefits—making cheap capital available to companies and individuals who previously couldn’t get it, allowing risk to be more efficiently allocated, and widening the range of potential investments. On a day-to-day level, it may even have lowered volatility in the markets and helped make the real economy more stable. The problem is that these improvements have been accompanied by more frequent systemic breakdowns. It may be that investors accept periodic disasters as a price worth paying for the innovations of modern finance, but now is probably not the best time to ask them about it.Actually for my money, Surowiecki's presentation is pithier than either of his companions ((though not nearly so richly nuanced as Bookstaber's). As to provenance--neither Surowiecki nor Harford cite Bookstaber. All three cite Charles Perrow. Bookstaber says that Perrow coined the term "normal accident," in his book Normal Accidents: Lving with High-Risk Technologies
. Bookstaber also citesa study by Scott Sagan entitled The Limits of Safety; he says that "these two books provide the details and examples that are the basis of the discussion in this chapter. I'm not clear whether either of these books discusses financial markets (I've seen only Google Books snippets, which are inconclusive). Harford does attribute some remarks on finance to Perrow, though they sound like the may have come from an interview, not from a book.Is anybody copying anybody here? Aside from citations to Perrow, cited by all three finance writers, it's hard to say. Maybe Surowiecki heard it at a dinner party. Maybe Harford ran into Perrow at an academic conference. Maybe there's an ur-source that underlies them all. One way or another: "normal accidents" and financial meltdown: by this time, they're yoked for eternity.
Update: My friend John reminds me that Steve Schwarcz from Duke has been writing about "tight coupling," with credit to Bookstaber. See, e.g., link.
True, but I Might Rent the Video
But it's hard to cut someone's hair while your customer is giving a massage and you are having a manicure.Link. The topic was marginal labor productivity.
To Drive Away Teenaagers, I believe you use Mozart
"Walter pulled the earphones out of his mobile phone, turned the volume all the way up and blasted heavy metal music over its miniature speakers. At the same time, he yelled as loud as he could while flailing his arms about wildly to scare off the pack of wild animals. ... Eikrem said he was able to drive away the wolves by playing the song "Overcome" by the American hard-rock band Creed."
Next up: wolves use Creed vocals to lure Norwegian schoolboys.
Thursday, January 20, 2011
Wednesday, January 19, 2011
Werner Herzog Reads Madeline
Taxmom believes I should not miss this:
Apparently there is a whole bunch of this stuff.
Update: Oh, I didn't get it. Apparently it is not really Herzog. Thanks, David.
Apparently there is a whole bunch of this stuff.
Update: Oh, I didn't get it. Apparently it is not really Herzog. Thanks, David.
Richard Bookstaber and the Curse of Squishy Numbers
Richard Bookstaber explains some hard facts about accounting that I thought I understood but which I understand much better having read Richard Bookstaber:
, which I'm just getting around to now a couple of years late; nonetheless one of the most helpful items I've encountered for understanding our current plight--I hope to say more about it later. For the moment, let me expand on his point this way: I wonder if one of the reasons why accounting has become so corrupt in recent years is the lack of the kind of firm, well-defined asset values you could look to in an era of iron and steel: if you were measuring as locomotive, you pretty much knew its market value. In these days of squishy and inimitable asset values--patent rights, trade secrets, the works, you have fewer firm points of reference. It makes it all the easier to yield the management pressure and just go with the numbers that management wants.
Oh, and one more thing I learned from Bookstaber. You remember Luca Pacioli, the father of accounting? Sure you do. Anyway, he was from Borgo San Sepolcro, home of the great Renaissance painter, Piero della Francesca. And apparently Pacioli appears as one of the saints in Piero's "Madonna with Saints" at the Brea in Milan (though there seems to be some uncertainty as to just which one).
The [19th Century] railroads depended on public financing and needed a means of assuring investors that their money was at home under a positive stewardship. They had accountants run through their books and then made their finances known through business journals. ... Standardization of accounting methods also came about through the demands of railroad accounting. ... After the crash of 1929, the Securities and Exchange Commission (SEC) mandated that these standards be applied ton all public corporations. This mandate persists today, but as often as not, the SEC is mandating the reporting of irrelevant information.That's from Bookstaber's A Demon of Our Own Design
The orientation that accounting took for railroads was, not surprisingly, focused on the assets of the company—the track and rolling stock, along with the deprecation of capital—rather than earnings. Value was defined simply as the cost of the assets less the depreciation of the assets over time. This orientation carried through smoothly to other industries of the era, principally manufacturing and transportation, where cost could be used as an index of value.
For real assets such as physical plant, assembly lines, machinery, and real estate, valuation in terms of costs is logical: a business can reproduce the enterprise by simply going out and buying each of the component parts that constitute the production process. But the relationship between the cost of assets and the value of the enterprise does not work as well for companies with intangible assets, and these increasingly form the basis of economic value today. Intangible assets—ideas, patents, proprietary software, brand names, trade secrets, trademarks, and copyrights—have value that cannot be extracted from their costs.
The reach of intangibles is extensive; as Charles Leadbeater has said, “modern corn is 80 percent science and 20 percent corn,” alluding to the extensive lab development behind hybrid corn seed. By some estimates, intangible assets now make up 80 percent of the value of the S&P 500. They are what provide companies with their franchise value, sometimes bordering on monopolistic market position. Intangible assets are the product of imaginative people who walk out the door every night; others are formulas locked in a vault. And in many cases, once they have been created and the intellectual property has been claimed, they cannot be reproduced at any price.
One simple indication that the current accounting conventions do not reflect the actual value of the enterprise is the disconnect that has appeared between market and book value. In the industrial era of the railroads, market value was all but defined by book value. If market value moved above book value, you would simply create the same enterprise for less money by replacing it brick by brick. The market-to-book ration stayed near one-to-one through the 1970s, but since the 1980s has slowly moved up. The ratio in the mid-1990s was on average about three-to-one, and shot up to six-to-one by the end of the decade. The extreme is in part due to the euphoria of the Internet bubble, but the ratio has been out of its classic balance for the better part of two decades, more than can reasonably be ascribed to a market disequilibrium.
, which I'm just getting around to now a couple of years late; nonetheless one of the most helpful items I've encountered for understanding our current plight--I hope to say more about it later. For the moment, let me expand on his point this way: I wonder if one of the reasons why accounting has become so corrupt in recent years is the lack of the kind of firm, well-defined asset values you could look to in an era of iron and steel: if you were measuring as locomotive, you pretty much knew its market value. In these days of squishy and inimitable asset values--patent rights, trade secrets, the works, you have fewer firm points of reference. It makes it all the easier to yield the management pressure and just go with the numbers that management wants.Oh, and one more thing I learned from Bookstaber. You remember Luca Pacioli, the father of accounting? Sure you do. Anyway, he was from Borgo San Sepolcro, home of the great Renaissance painter, Piero della Francesca. And apparently Pacioli appears as one of the saints in Piero's "Madonna with Saints" at the Brea in Milan (though there seems to be some uncertainty as to just which one).
Mother of Mercy, Is This the End of Mico?
Ever ready with a cultural reference, deposed Republican National Chairman Michael Steele says he knows how Caesar felt. But this is the man who confused War and Peace with Tale of Two Cities. Could he be thinking of Little Caesar, as memorialized by Edward G. Robinson? Or maybe he's just sending out for pizza?
Tuesday, January 18, 2011
The Voice of the Damned
I see the new Governor of Alabama says that only Christians are his brothers and sisters and that the rest of us can just go to hell. Well as they say, heaven for climate and hell for society and it looks like I won't have to put up with the governor of Alabama for all eternity. But it does make me wonder: how come all those schismatic, heretical Christians get a bye? Does he really mean to include feet-washing, along with full-dunk, Baptists such as himself? Eastern Orthodox? Papists? I read somewhere that there are 2,500 (or is it 25,000?) sects of Christianity in the world. Can he honestly face his homeys and say that none is a heretic?
The Left Has a Lot to Answer For
Seems like everybody who counts wants to weigh in on Freddie deBoer (who?) 's piece decrying the marginalization of the left in the blogosphere. See link, link, link, link, and perhaps especially link and many more. I won't pretend to have read all of them, and I certainly can't top the best of them but I do want to add a thought that I haven't seen well enough elsewhere.
For starters, I think deBoer is right; the blogosphere does need a more engaged left. We all need a better left: market liberalism has turned into a kind of groupthink which is bound to become (if has not already become) a blind alley. Sooner or later somebody or something is bound to upset this conceptual applecart and the sooner it happens the better for everybody. If you doubt it, recall how the right horned itself into the dialogue 30 years ago and how, for all the howling (and, okay, for all the mandacity, the irresponsibility and the outright cruelty) the enquiry has been enriched by its presence. The dialogue needs the left.
The obvious corollary is that if the left isn't part of the dialogue, it's its own fault: the left isn't in the dialogue because nobody is listening and nobody is listening because the left doesn't have much to say. this is a harsh, smug, self-satisfied and dismissive response. Yet I will embrace it, because I think it is true. The fact is, the left hasn't had anything interesting to say in years. And this is a pity, because there are so many things on which things to be said.
Start with free trade. It's one issue on which neoliberals and (many) conservatives agree. Trade barriers bad, free trade good. The left doesn't like free trade; they say it robs us of good jobs at the expense of low-paid labor overseas. The mainstream response is that it really doesn't work that way--but the left isn't persuaded and in truth, they have a lot of evidence on their side. Yet where is it written that American (steelworkers, auto workers, textile workers, whatever) should live well while a Bagladeshi starves? Is this really what the left wants? I doubt it, but isn't it s legitimate concern, and as such, doesn't it deserve a response?
Or take the closely related issue of (private sector) trade unions (remember them?). The left pines for a day when a man (sic) with a good union job could expect to support his wife and a couple of kids with a home in the suburbs, like Homer Simpson? Well, you know what? We all pine for those days. Or, everyone except Scrooge McDuck. We doubt they are on offer again; we suspect they depend on grotesquely unbalanced world economy, supported by trade barriers (see previous paragraph) that allowed Charlie Wilson and Walter Reuther to set an above-market price and divvy up the proceeds while we all drove crap cars. Or worse: they loaded us up with railway featherbedding, with printers' bogus, with an illimitable array of makework charades that loaded us all up with extra costs while doing exactly nothing--or, nothing positive--for the worker's sense of self-worth.
We don't want to go back there, do we? Once again, the question is not rhetorical. Maybe the answer is "sure." But it is a question, and deserves a candid and reasoned response--the kind of response that can only come from those who appear most committed to the old and (seemingly?) discredited scheme.
Or take public employee unions. This is a somewhat different issue because they didn't even exist in the old days. I speak out of special interest here because I enjoy a public pension and I'm just delighted to have it, thank you. And in general, I think it is a fine idea to have a public service that is well paid. But "well paid" has to mean "well paid for services rendered." Thus I'm not at all disturbed when we pay our public school teachers decent salaries, but don't we have the right to expect something in return? Can we really justify having teachers so (comparatively) well paid when the results they turn in are so consistently awful?
Or take the calamity of the underclass. The right made some of its greatest inroads a generation ago when they cast a cold eye on Great Society spending programs and ventured you can't solve problems by throwing money at them. And remember what happened? Okay, I'll remind you: what happened was that they were proved largely right: all kinds of noble aspirations withered into private honeypots for the well-connected; jobs for the boys (and later, girls). In a way it is a cheat: a lot of the voices insisting most loudly that you couldn't solve problems by throwing money at them--a lot of those voices really didn't give a rat's hind end whether the problems got solved or not (and they certainly weren't interested in giving their advice to the military). But at the core, they were right. The "liberals" pretty well lost that round, and it may be what cut them off from their leftist roots. But the "left" for the most part, seems not to have learned the lesson. And once again, we need to frame it as questions: can we really, despite all the evidence, really solve problems by throwing money at them? Can you put our mind at rest on that issue? If not, what do you have to offer that will trump our concerns.
I could on here but I suspect you get the drift. To restate the general point: I think there's a large chunk of the citizenry--I'd count myself among it--who have a serious interest in the health of the body politic, and a genuine eagerness to help produce a just society in which everyone can live with decency and self-respect (and good luck with that, eh?). We certainly aren't eager to sign on to what we regard as the mainstream conservative agenda. We are, for example, deeply apprehensive about the rising power of "movement Christianity"--we tend to be pro-choice; we believe in human-made climate change; we're revolted by vulgar creationism. But we aren't at all persuaded that "the left" has answers that are distinctive or interesting or, most of all plausible.
There is another, even more, contentious, way of stating the point: the left is still stuck pre-1989. I don't suppose there are any communists left anywhere any more except on the North Korean politburo. But a whole world of traditional leftism crumbled along with the Berlin wall. It would take a hero to rebuild, or rather "reconstruct" it all. I suppose it seems unfair to impose the responsibility on the advocates--a dialogic form of "blaming the victim." Yet if anybody has done--or even begun--the job in any remotely plausible way, then I have missed it. Any takers?
For starters, I think deBoer is right; the blogosphere does need a more engaged left. We all need a better left: market liberalism has turned into a kind of groupthink which is bound to become (if has not already become) a blind alley. Sooner or later somebody or something is bound to upset this conceptual applecart and the sooner it happens the better for everybody. If you doubt it, recall how the right horned itself into the dialogue 30 years ago and how, for all the howling (and, okay, for all the mandacity, the irresponsibility and the outright cruelty) the enquiry has been enriched by its presence. The dialogue needs the left.
The obvious corollary is that if the left isn't part of the dialogue, it's its own fault: the left isn't in the dialogue because nobody is listening and nobody is listening because the left doesn't have much to say. this is a harsh, smug, self-satisfied and dismissive response. Yet I will embrace it, because I think it is true. The fact is, the left hasn't had anything interesting to say in years. And this is a pity, because there are so many things on which things to be said.
Start with free trade. It's one issue on which neoliberals and (many) conservatives agree. Trade barriers bad, free trade good. The left doesn't like free trade; they say it robs us of good jobs at the expense of low-paid labor overseas. The mainstream response is that it really doesn't work that way--but the left isn't persuaded and in truth, they have a lot of evidence on their side. Yet where is it written that American (steelworkers, auto workers, textile workers, whatever) should live well while a Bagladeshi starves? Is this really what the left wants? I doubt it, but isn't it s legitimate concern, and as such, doesn't it deserve a response?
Or take the closely related issue of (private sector) trade unions (remember them?). The left pines for a day when a man (sic) with a good union job could expect to support his wife and a couple of kids with a home in the suburbs, like Homer Simpson? Well, you know what? We all pine for those days. Or, everyone except Scrooge McDuck. We doubt they are on offer again; we suspect they depend on grotesquely unbalanced world economy, supported by trade barriers (see previous paragraph) that allowed Charlie Wilson and Walter Reuther to set an above-market price and divvy up the proceeds while we all drove crap cars. Or worse: they loaded us up with railway featherbedding, with printers' bogus, with an illimitable array of makework charades that loaded us all up with extra costs while doing exactly nothing--or, nothing positive--for the worker's sense of self-worth.
We don't want to go back there, do we? Once again, the question is not rhetorical. Maybe the answer is "sure." But it is a question, and deserves a candid and reasoned response--the kind of response that can only come from those who appear most committed to the old and (seemingly?) discredited scheme.
Or take public employee unions. This is a somewhat different issue because they didn't even exist in the old days. I speak out of special interest here because I enjoy a public pension and I'm just delighted to have it, thank you. And in general, I think it is a fine idea to have a public service that is well paid. But "well paid" has to mean "well paid for services rendered." Thus I'm not at all disturbed when we pay our public school teachers decent salaries, but don't we have the right to expect something in return? Can we really justify having teachers so (comparatively) well paid when the results they turn in are so consistently awful?
Or take the calamity of the underclass. The right made some of its greatest inroads a generation ago when they cast a cold eye on Great Society spending programs and ventured you can't solve problems by throwing money at them. And remember what happened? Okay, I'll remind you: what happened was that they were proved largely right: all kinds of noble aspirations withered into private honeypots for the well-connected; jobs for the boys (and later, girls). In a way it is a cheat: a lot of the voices insisting most loudly that you couldn't solve problems by throwing money at them--a lot of those voices really didn't give a rat's hind end whether the problems got solved or not (and they certainly weren't interested in giving their advice to the military). But at the core, they were right. The "liberals" pretty well lost that round, and it may be what cut them off from their leftist roots. But the "left" for the most part, seems not to have learned the lesson. And once again, we need to frame it as questions: can we really, despite all the evidence, really solve problems by throwing money at them? Can you put our mind at rest on that issue? If not, what do you have to offer that will trump our concerns.
I could on here but I suspect you get the drift. To restate the general point: I think there's a large chunk of the citizenry--I'd count myself among it--who have a serious interest in the health of the body politic, and a genuine eagerness to help produce a just society in which everyone can live with decency and self-respect (and good luck with that, eh?). We certainly aren't eager to sign on to what we regard as the mainstream conservative agenda. We are, for example, deeply apprehensive about the rising power of "movement Christianity"--we tend to be pro-choice; we believe in human-made climate change; we're revolted by vulgar creationism. But we aren't at all persuaded that "the left" has answers that are distinctive or interesting or, most of all plausible.
There is another, even more, contentious, way of stating the point: the left is still stuck pre-1989. I don't suppose there are any communists left anywhere any more except on the North Korean politburo. But a whole world of traditional leftism crumbled along with the Berlin wall. It would take a hero to rebuild, or rather "reconstruct" it all. I suppose it seems unfair to impose the responsibility on the advocates--a dialogic form of "blaming the victim." Yet if anybody has done--or even begun--the job in any remotely plausible way, then I have missed it. Any takers?
Who Bears the Cost?
Here's a puzzle I picked up from a BBC puzzle show. Romeo is getting ready for a date with Juliet. He figures it'll cost him 30 pounds and he has 20. He goes to the pawn shop and borrows 15 pounds; he gives the 20 pound note as security. Back at the dorm, he sells his pawn ticket to Roomie for 15 pounds.
The question is: who bears the greatest cost in this transaction, and how much is it?
This one is said to have been devised by Lewis Carrol, he of Alice in Wonderland fame. For an answer to the puzzle, and for a meta-puzzle, go here.
The question is: who bears the greatest cost in this transaction, and how much is it?
This one is said to have been devised by Lewis Carrol, he of Alice in Wonderland fame. For an answer to the puzzle, and for a meta-puzzle, go here.
NPR and the Giffords Report
I wasn't listening to NPR on the day of the Giffords shooting and I just now learned how they apparently stepped in it bigtime, reporting that the Congreswoman dead when--of course--she was not:
NPR correspondent Ted Robbins is based in Tucson. He was at the scene Jan. 8 when his cell phone rang shortly after NPR aired at 2:01 p.m. EST that Giffords died. The call was a friend, who is also a friend of Giffords.
The friend was sitting outside the hospital operating room with Giffords’ mother Gloria, holding her hand.
Please tell them to stop reporting she is dead,” he begged Robbins. “She is in surgery.”Link. I'm actually impressed that NPR waited to get two sources--though I suppose Simon's proposed ramping-up is even better. I also wonder if NPR would have backed away as fast as it did without the intervention of a heavy hitter.
Scott Simon, host of NPR's Weekend Edition Saturday, got a similar call. Simon and his family are close friends of Giffords and her husband, astronaut Mark Kelly.
At 2:08, a distraught family member called: "Scott, where the hell is NPR getting that information?"...
Simon phoned the NPR news desk and was told the information was based on "confirmation" from the Pima County Sheriff’s department and a congressional source.
He didn’t think that was good enough.
“I couldn’t fathom how cops or pols would know more than the hospital,” said Simon. “Two sources who are not in a position to know something are not reliable sources.”
Robbins also questioned why the NPR Washington staff didn't listen to their reporter at the scene.When he called news desk editor Denice Rios, she explained that NPR had two sources. He told her they were inadequate. Rios then pulled back on the reports and the network changed Giffords' status.
Simon called back the family member with the explanation he received from NPR's news desk.
... Simon sent these suggested operating principles to top management:“There should be no room for doubt when a news organization declares someone dead. They should wait until the medical authorities directly involved declare death, or close family members announce it. There is simply no way that anyone else—not local police, not witnesses, not 'two governmental sources'—would be in a position to know for certain especially when there are now, between respiration and brain activity, at least a couple of medical gauges of death.”
The Cumbaya Curse
I've tried to say this before, but probably not so well:
Obama's lack of artifice can be admirable, but it is almost never politic. For a while he even wouldn't wear that kitschy American flag lapel pin, 95 cents worth of patriotism. But blarney is as essential to politics as the evanescent lie is to seduction. I am referring now to convincing strangers that you understand their concerns, feel their pain, so that in the end you actually do. A good politician never speaks to a crowd. It is always a collection of friends. Obama speaks mostly to crowds. His hallmark has been his disconnect, a perplexing standoffishness that has hurt him politically.So Richard Cohen, link.
Monday, January 17, 2011
Is Borders Circuit City?
I admit I am obsessing over the (incipient?) failure of Borders Books, but I've just finished this splendid Peter Osnos piece who brings to bear the skills of an experienced journalist together with his second career as a bookseller. It certainly leaves you with the unpleasant picture of a management screwup--rather, parade of screwups; I feel particularly for the plaintive cry of the commentator who writes about what it's like to watch the spectacle of front-office incompetence from the perspective of a (what would it be, $10 an hour?) employee. At the end, the name that sticks in my mind is "Circuit City." Are we witnessing the sorry spectacle of one more company that thinks it can save itself by sucking the brains and talent out of the work force while continuing to continuing to live its own life of isolated and deluded comfort?
Sunday, January 16, 2011
Art and Politics Watch
We took in the post-impressionist show at the de Young in San Francisco today. Lots of world-class stuff, no doubt about it, although it was pretty crowded -on a scale where "King Tut" is ten, maybe a 6.5 or a seven. No surprise in that this was the next to the last day (the audio commentary, FWIW, was perfunctory at best).
In long queues to see the superstars I found myself idling: we have neo, proto and crypto fascists, but when it comes to impressionists, we only have neos. Well: I suppose we do have protos although they are more often called "precursors." Cryptos are, I suppose, something you can have in politics but just can't have in art: if one wanted to represent a particular movement but to conceal his representation, just how would he do it (for "crypto-impressionist," Google gives me one hit, which is the Google equivalent of zero--I did not linger to figure out just what the writer could be talking about).
Footnote: these last two days have been, weatherwise, about the mot pleasant I have ever spent in this often-pleasant city. I came home tonight to read about the prospects of a 45-day rainstorm. Am I feeling like they felt in August, 1914?
In long queues to see the superstars I found myself idling: we have neo, proto and crypto fascists, but when it comes to impressionists, we only have neos. Well: I suppose we do have protos although they are more often called "precursors." Cryptos are, I suppose, something you can have in politics but just can't have in art: if one wanted to represent a particular movement but to conceal his representation, just how would he do it (for "crypto-impressionist," Google gives me one hit, which is the Google equivalent of zero--I did not linger to figure out just what the writer could be talking about).
Footnote: these last two days have been, weatherwise, about the mot pleasant I have ever spent in this often-pleasant city. I came home tonight to read about the prospects of a 45-day rainstorm. Am I feeling like they felt in August, 1914?
Saturday, January 15, 2011
Voodoo Yoga Note
My friend Cindy tells me she's learned a new yoga technique that reduces her blood pressure to a level almost vanishingly low. That's nice to hear but I wonder--where does all that blood pressure go? Could it be that we have a technique not merely for reducing one's own blood pressure but for increasing the blood pressure of somebody else?
The city of Louisville is built on a great slab of Bedford limestone--bear with me, there's a sequitur here. If you want to put down a septic tank, you take a stick of dynamite and blow a hole in the limestone. Sure enough, all the bad stuff will disappear. The trouble is, it will pop some place else and nobody can say in advance just where. All we know is that somebody in town is going to wake up one morning to an unpleasant surprise. I wonder if it works the same way with Cindy's blood pressure.
Or should I be thinking along the lines of "I don't get ulcers, I give 'em"?
The city of Louisville is built on a great slab of Bedford limestone--bear with me, there's a sequitur here. If you want to put down a septic tank, you take a stick of dynamite and blow a hole in the limestone. Sure enough, all the bad stuff will disappear. The trouble is, it will pop some place else and nobody can say in advance just where. All we know is that somebody in town is going to wake up one morning to an unpleasant surprise. I wonder if it works the same way with Cindy's blood pressure.
Or should I be thinking along the lines of "I don't get ulcers, I give 'em"?
All that we Ask is, Give Peace a Chance
Mrs. Buce advises that an important step forward in evolution occurs when prokaryotes begin eating other prokaryotes and becoming eukaryotes. I suppose we take our food where we find it but I'm thinking of all those teen-aged prokaryotes who drive their parents nuts by refusing to eat other prokaryotes because it is cannibalism.
Friday, January 14, 2011
Unemployment Datapoint of the Day
Big guy in work clothes chatting in the breakfast room:
Yeh, when business started to slow down, I laid off my least valuable people, the ones I could most do without. Later on, I had to let the better ones go. But the weakest ones got out early and so they found new jobs. The better ones are still hurting. I would have done them a favor by laying them off earlier.Don't know what business, but there are a lot of utility trucks in the parking lot.
Maybe They Should Have Used the Urban Compost Tumbler
Top this for a headline:
Link.
Disbarred Law Firm Partner Blames His Trampoline
For Female Divorce Client’s ‘Soreness’
For Female Divorce Client’s ‘Soreness’
Link.
Thursday, January 13, 2011
They're Making Them Sleep in an Urban Compost Tumbler!
This is, after all, a famously green city:
Rotating shelter keeps homeless from cold
--The California Aggie, page 1, January 13, 2011
Davis, CA
I Dunno, Maybe I'm Just Gettting Old...
...but I listened to every word of this. Takeaway: envy is the only one of the seven deadly sins you won't enjoy.
Congressperson: Not That Special
Ezra nails it, mostly:
Ezra also says that Congresspeople are actually much nicer, more hard working, more public spirited than we give them credit for being. I suppose that almost has to be true because we start from such a low benchmark. Still, I wouldn't get too carried away with it. The fact is that for many Congresspeople, granted all that Ezra said above, this is still the best job they ever had or expect to have, their ticket out of something to something. In the nature of things, it is hardly surprising that we get a lot of fairly empty strivers.
[Just for the record, I'd say from what I read (I never heard of her until she got shot) I'd say that Gabby Giffords is about as far as you can get from "empty striver." She sounds like one Congressperson I'd actually like to get to know. What a waste. Even if she makes a perfect recovery, what a waste.]
Serving in Congress is actually a sort of crummy life: You live in a small apartment, you spend most of your time missing your family, you're constantly in airports, and when you do get home you barely have time to see your kids because you're running to meet with constituents. It's a grind. And -- this is where kids and adults alike overestimate politicians -- you're not that important. No one cares about the speech you just gave or the amendments you just proposed. The media generally doesn't pay attention unless you become part of a controversy, or say something dumb. You have to do what your leadership tells you. You get yelled at a lot.He might have added: and a lot of people think that, because the Congresssperson is a Congressperson, the voter (or even the non-voter) can treat him like dirt: you can yell at him, lace him in an aura of withering contempt, make it clear you think he is a crook and a lackey, but also your lackey. Hard to keep up a good attitude under that kind of strain.
Ezra also says that Congresspeople are actually much nicer, more hard working, more public spirited than we give them credit for being. I suppose that almost has to be true because we start from such a low benchmark. Still, I wouldn't get too carried away with it. The fact is that for many Congresspeople, granted all that Ezra said above, this is still the best job they ever had or expect to have, their ticket out of something to something. In the nature of things, it is hardly surprising that we get a lot of fairly empty strivers.
[Just for the record, I'd say from what I read (I never heard of her until she got shot) I'd say that Gabby Giffords is about as far as you can get from "empty striver." She sounds like one Congressperson I'd actually like to get to know. What a waste. Even if she makes a perfect recovery, what a waste.]
Why Yiddish will Never Die
The entire text of an email from my friend Nancy:
It would still have been true even if she had skipped the emoticon.Feh.And "feh" is why Yiddish will never die. :)
Grab it While you Can
My newsreader brings me an ad for a book called Invention Analysis and Claiming; A Patent Lawyer's Guide. The blurb says it offers me "a comprehensive approach to analyzing inventions and capturing them in a sophisticated set of patent claims."
I suppose I'm just carping here but I don't see anything in this blurb about actually inventing the stuff. I haven't read the book, but I wonder: is there anything there about inventors, or is this simply a book for the Bill Gateses and Guglielmo Marconis of the world, whose real skill seems to come in the deploying--and profiting from--the creativity of others? Analyzing and capturing indeed. Sophisticated set of claims, oh dear.
I suppose I'm just carping here but I don't see anything in this blurb about actually inventing the stuff. I haven't read the book, but I wonder: is there anything there about inventors, or is this simply a book for the Bill Gateses and Guglielmo Marconis of the world, whose real skill seems to come in the deploying--and profiting from--the creativity of others? Analyzing and capturing indeed. Sophisticated set of claims, oh dear.
Manufacturing: Mark Perry Imposes A Reality Check
I'm one who has whined about the decline of manufacturing, so it is bracing to read the great contrarian Mark J Perry collecting the data to suggest that these "decline" stories are much overblown. But Perry's data do show that we retain manufacturing power while shedding manufacturing jobs. I have also been enjoying the great curmudgeon, Charlie Munger, saying he just isn't seeing any place where job growth will come from (Munger's advice: suck it up).
Funny thing about Perry: from all I read, I'd infer that he regards President Obama with contempt and loathing. But virtually everything he showcases--say, 90 percent--is designed to show that things are really much better than you expected.
Funny thing about Perry: from all I read, I'd infer that he regards President Obama with contempt and loathing. But virtually everything he showcases--say, 90 percent--is designed to show that things are really much better than you expected.
Cold-Weather Favorite
The Wichita Bureau finds what you need to get you through the winter: boil packets of lutefisk. But there's a two-bag minimum.
Wait, I was Wrong to say Nobody Liked it
Scientists say they've found evidence of a hitherto unknown species of humankind, in frozen DNA from Siberia. I think I've found something even rarer: a guy who (says he) actually liked George Bush's memoir. That would be Andrew Roberts, once the recipient of a favorable review here at Underbelly (link; see also link but cf. link). And, yes, he also likes the President behind it who, he says "emerges as someone who tended to make the same decisions that any sensible, well-informed, patriotic person would have made, faced with the same circumstances." Iraq? Big success. Torture? Well, it was only three guys, and we learned a lot. Stem cells? "[H]e never allowed his faith to overcome reason and logic," says Roberts and no, I haven't a clue what that means either. Roberts gushes:
How Bush has retained his breezy good nature through the most prolonged and systematic character assassination for a generation is anyone's guess, but he has. He even tells gags against himself that he must know will be picked up and used by his enemies.I'd have to grant Roberts a point here: Bush's serene indifference to the opinion of anyone but himself has always been a marvel to behold. Of course you can probably bear the burden of criticism more easily if you didn't write the book. Or (as Bush used to say about the newspapers) never read it.
Wednesday, January 12, 2011
Why I Left New Hampshire
My friend Marge reminds me of why I'm glad I left New Hampshire:
Clarification: no, I'm not complaining about the flag. I just hope it doesn't get swamped with snow.
The Calendar is in Alignment
Yesterday at 1:11 it was 1:11 1-11-11(actually, I guess twice yesterday, unless you are on military time). But the grandchild whose birthday was yesterday points out that it will happen again this year--not his birthday, but the confluence. That would be November 1, aka 11-1; so 1:11 11-1-11.
We get a lot of patterned dates. Next year, we will have 12-12-12, and two years after that, 12-13-14. Last year we had 10-10-10. But do we ever otherwise get a double like this?
Update: Oh, right. My sister Sally points out that there is also 11-11-11. She recalls that 11-11 was our mother's birthday, the wrong year. And she says a bud of hers delighted himself for getting through a phone call to her that registered as received at 1/11/1. I'd say a whole bunch of people just need to get out more.
We get a lot of patterned dates. Next year, we will have 12-12-12, and two years after that, 12-13-14. Last year we had 10-10-10. But do we ever otherwise get a double like this?
Update: Oh, right. My sister Sally points out that there is also 11-11-11. She recalls that 11-11 was our mother's birthday, the wrong year. And she says a bud of hers delighted himself for getting through a phone call to her that registered as received at 1/11/1. I'd say a whole bunch of people just need to get out more.
Tuesday, January 11, 2011
How Big Is It?
I'm getting acquainted with my corporate finance class this week. They seem to be a bunch of engaging young people, bright and inquisitive, yet obviously inexperienced at this kind of thing or they wouldn't be wasting time with me. Anyway, I was riffing on how the financial sector has grown by "a lot" these last few years--how big, I asked on impulse, do you think it is, as a percentage of gross domestic product? Nobody professed to have anything like an informed opinion; the guesses ranged from 34 to 51 percent. The correct answer is closer to eight percent (see an excellent Wiki discussion here).
Proves nothing, I know, and I doubt I would have got it anywhere near right had a not been a careful student of Paul Krugman. But maybe it does suggest that--forget about the details, they know banking is pretty dam big.
Proves nothing, I know, and I doubt I would have got it anywhere near right had a not been a careful student of Paul Krugman. But maybe it does suggest that--forget about the details, they know banking is pretty dam big.
The Parents Speak
I've just seen some snippets from the statement of the parents in the Tucson case (link, link). My no-snark impulse is: they seem to have written it themselves. And I'd mark this up to their credit: in their private desolation at least they don't seem to have allowed themselves to get spun by a spin doctor.
Yes, yes, I hear you. And it may be that these people made some unfruitful choices in raising their child. But no matter how wrong-headed, I doubt that they hoped to raise their boy to be a mass murderer.
Yes, yes, I hear you. And it may be that these people made some unfruitful choices in raising their child. But no matter how wrong-headed, I doubt that they hoped to raise their boy to be a mass murderer.
And the Winner of the Look-alike Contest Is...
Happy to see William Black from the Kansas City blog thumping the same tub I've whacked at before: Fannie Freddie got in trouble not for acting like a pesky government agency but by behaving just like bank Might be a useful reality check for corporate theorists to note how the bosses were concerned enough for their own bonuses that they were willing to let the company go over a cliff
Monday, January 10, 2011
Rand Paul Knows
I see that Rand Paul joins the Bill Frist school of telepathic medicine, declaring of the (alleged) Tuscon shooter, "from a medical point of view, there's a lot to suggest paranoid schizophrenia..." Paul is an eye doctor, certified by a board which he created (perhaps he created a board of psychiatry as well). He seems to be remembering the rule that an optometrist is someone who sees the world through rose-colored glasses.
The Banality of Loughner
I've been reading a lot of the tuff about what a nutter young Loughner is. See link, link,link, link, etc. I'll vote otherwise: I'm struck by how near normal.
Look, I didn't say "normal;" only "near normal." And when I say "near normal," I suspect I mean "for an 18-to-20-year-old boy" (sic). Let's face it: most late adolescent males are pretty weird; it's just that most of them get their bearings again before they take he lives of half a dozen people. I mean, here's Christopher Beam in Slate:
"conscious dreamer?"), but I certainly remember the shock of disorientation when I first realized how much of the world seemed to be in my head (thanks to Bishop Berkeley for getting me into that pickle, and Samuel Johnson for getting me out of it). I admit I am still trying to work out the meaning of grammar structure, and in particular its relation to freedom, state sovereignty, etc. (one reason why I read Boing Boing). As to "the gold standard," it has sunk into me lately that the case against it is not quite so ironclad as I thought: as James Ridgeway at Mother Jones says, "Concerns about currency stretch from extreme conspiracy theorists to traditional libertarians" (gold still loses, though).
Kent Slinker, the math teacher quoted in Beam's piece, saysLoughner sounded "someone whose brains were scrambled." Beam paraphrases: "[Loughgren] e was a mess. He didn't perform well on tests. He would ask questions that didn't make any sense. "...He was mentally checked-out. But Slinker also says "I never sensed violence from him," and that is just the point--from the sound of things he was just a bit more weird than what (I suspect) they saw in a community college philosophy class every day.
Do not misunderstand: I don't for a moment want to excuse a mass killer. And I don't suppose it would be feasible (even if prudent?) to look away all disturbed late adolescent males--but who was it who said we should just send 'em all away to a desert island somewhere, to wear torn underwear and drink milk out of a carton (oh--that was "all males of any age?"--sorry). Werther; Rameau's nephew; the Underground Man, Steven Daedalus: their name is legion. Until we breed 'em out, we're going to have to do something to keep them defanged and at least unthreatening. But the melancholy truth will be the task of distinguishing the murderous instinct from ordinary alienation may not be as easy as we'd like.
Look, I didn't say "normal;" only "near normal." And when I say "near normal," I suspect I mean "for an 18-to-20-year-old boy" (sic). Let's face it: most late adolescent males are pretty weird; it's just that most of them get their bearings again before they take he lives of half a dozen people. I mean, here's Christopher Beam in Slate:
[Loghner] claims to be a "conscience dreamer" concerned with "English grammar structure" and "mind control" who wants to see the United States return to the gold standard.Chris baby! Is that the best you can do? But isn't that awfully close to what you expect--dare I say want--young people to do? I'm actually a newbie to the idea of "conscience dreamer" (did he mean
"conscious dreamer?"), but I certainly remember the shock of disorientation when I first realized how much of the world seemed to be in my head (thanks to Bishop Berkeley for getting me into that pickle, and Samuel Johnson for getting me out of it). I admit I am still trying to work out the meaning of grammar structure, and in particular its relation to freedom, state sovereignty, etc. (one reason why I read Boing Boing). As to "the gold standard," it has sunk into me lately that the case against it is not quite so ironclad as I thought: as James Ridgeway at Mother Jones says, "Concerns about currency stretch from extreme conspiracy theorists to traditional libertarians" (gold still loses, though).
Kent Slinker, the math teacher quoted in Beam's piece, saysLoughner sounded "someone whose brains were scrambled." Beam paraphrases: "[Loughgren] e was a mess. He didn't perform well on tests. He would ask questions that didn't make any sense. "...He was mentally checked-out. But Slinker also says "I never sensed violence from him," and that is just the point--from the sound of things he was just a bit more weird than what (I suspect) they saw in a community college philosophy class every day.
Do not misunderstand: I don't for a moment want to excuse a mass killer. And I don't suppose it would be feasible (even if prudent?) to look away all disturbed late adolescent males--but who was it who said we should just send 'em all away to a desert island somewhere, to wear torn underwear and drink milk out of a carton (oh--that was "all males of any age?"--sorry). Werther; Rameau's nephew; the Underground Man, Steven Daedalus: their name is legion. Until we breed 'em out, we're going to have to do something to keep them defanged and at least unthreatening. But the melancholy truth will be the task of distinguishing the murderous instinct from ordinary alienation may not be as easy as we'd like.
Oy, Men...
I doubt if any human being, however poetic or however material, ever looked upon the scenes of this world, material or spiritual so-called, with a more covetous eye. My body was blazing with this keen sex desire I have mentioned, as well as a desire for material and social supremacy--to have wealth, to be in society et cetera--and yet I was too cowardly to make my way with women readily. And at the same time I doubt sometimes whether my so-called passion--vigorous as it was--was not much more than a thing of the mind than the body. Love of beauty as such--feminine beauty first and foremost, of course, but in addition to that all natural forms which were somehow included with and supplemented the feminine lure--was the dominating characteristic of all my moods: joy in the arch of an eyebrow, the color of an eye, the flame of a lip or cheek, the romance of a situation; spring trees, flowers, evening walks, the moon; the roundness of an arm or leg, the delicate tracery of an ankle or foot; spring odours, moonlight under trees, a lit lamp over a dark lawn--what tortures have I not endured on account of these! Not even music at its zenith, or color at the end of a master's brush or the poignant phraseology a de Maupassant, a Flaubert or a Daudet (via Sapho) has ever expressed for me the sweet agonies that I myself have endured contemplating the charms--the public, conservative, fashionable charms, if you will--of those enticing flowers, girls, in their delicious setting, the beauty of life itself.
--Theodore Dreiser, Newspaper Days 128-9 (Black Sparrow Press 2000)
[The book has a complicated history but it seems to have been composed mostly in 1920-21.]
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