Thursday, March 02, 2017

Bitcoin Haiku

It's been more than three years since I first posted these. So on the day when the value of 1 Bitcoin surpassed that of 1 oz of Gold, I thought it'd be fun to see how they have aged.  For the sake of FD, I can re-affirm that I own no Bitcoin (as if you had to wonder).


Icarwho?

Up Up and Away
The sun feels good up yon-der
"Relax!" said Hamlet


Macklemore&More&More

Pop some Bitcoin tags?
'Mother Mary & Joseph' !!!!
Napoleon's Waterloo


Left Of the Curtain

The Wizard told him
"Rub two Bitcoins together"
What is 'kurtosis'?


Security

ya-da ya-da ya
crytpocharlatanery
Where's my USB?


Not the Monkey King

'That's a nice robe'
Exclaimed she to the vain king
Eat more bananas.


Giapetto's Nightmare

Pinocchio dreamed
When you wish upon a star
Jiminy Bitcoins!


(with apologies to Bashō; As usual, all contributions are most welcome)

Wednesday, February 01, 2017

On The EU & Brexit

The following is a my Remainer's reply to a Brexiteer's comment on my last piece "The Uninspiring Antitheses to Populism". I wouldn't normally turn a reply into a post but I've been wanting to articulate most of these thoughts in Cassandra's record for the future. I've replied in-line to the commentator's (in boldface italics). All further comments, thoughts and replies are both welcomed and appreciated (especially opposing views):

* * * * * * * * * * * * * * * * *

I am huge admirer of your blog and this piece of yours is an excellent example. However, although it's true that Brexit is fraught with downside risks to the UK economy, with few likely economic upsides, there are good reasons for its necessity nonetheless. The vast majority of UK voters and politicians are in favour of the club that we joined: an alliance of advanced West European countries bound together in a free-trade customs union.

Thank you for the kind comments. I have few doubts that that there reasons people hold for Brexit. Whether such reasons have virtue is more contentious. First, I'm sure I needn't recount the history of the EU as rooted in the ECSC. This was, first and foremost, a political project and for very good reasons following the scale of death & destruction from two world wars, that was pragmatically rooted in mutual economic entanglement. Churchill knew this since his ideas were central. Ted Heath, the UK's steward, knew this, both when UK was rejected, and when his efforts were finally requited.

But our Continental partners pushed on with a different vision: a nation called Europe 

I can't find the nation called Europe, anywhere. Yes some members have agreed currency union. Others have chosen to do away with internal borders. Some even "feel" themselves more European in spirit than their national identity. But last time I looked, UK was not a member of either Schengen or the Eurozone.  If anything it is for THOSE countries to feel concerned about real or imagined EU power usurption - NOT Britain. After all, it is they (not UK) who will in likelihood, eventually move towards at least a weak form of fiscal union – probably weaker than Canada which itself is one of the weaker federal unions. But why should that concern the UK? Yes, it may sap more political energy and activism, but that should suit UK just fine as they are, by your own view, interested in a narrowly purposeful trading union.

Most Brexiteers who claim to support Free Trade speak derisively of a “single market”, but it's worth re-stating that, for most, a single market IS the holy grail of free-trade. It is precisely what drives the internal economic might of the US. It is far more powerful and liberating than a mere "free-trade zone" or "customs union". It levels the playing field helping prevent cheaters (e.g from excessively polluting or abusing labour safety in order to gain cost advantage), and closet exclusion (e.g.  domestic agencies like VOSA from creating NTBs that might reference “peculiarly special nature of UK roads” to exclude foreign made cars). There's obviously much more - much of what individual nations would do of their own accord for their own benefit, but is far more efficiently accomplished and sensibly implemented at large scale (pharma & chem  regulations; health & safety, environmental standards. Most are essential since pollution, food safety, etc  don't respect borders  One need only look at the idiocy of US insurance regulation where each state maintains it's own insurance commission and regulatory regime, to realize the value. But a single market is decidedly NOT a nation, nor does pretend to be. Yes, ALL members cede a modicum of sovereignty (Britain less than others) in exchange for the large opportunity within the single market . Fortunately, the EU  remains a customs union as well (like the one the UK joined) since they are not mutually exclusive, which has even more palpable advantage than it did when Britain joined. This is particularly true when broadening the Single Market's opportunity against larger, and more powerful counterparties (US, China, Japan, India)  which is where most major trade results. The advantage is counter-veiling power as well as technical negotiating ability. Outside of Fishing, I've heard few if any Brexiteer talk specifics of trade that would occur, but that hasn't as a result of the EU, although we have heard an endless stream of concrete examples of how the UK benefits from both customs union and single-market membership. While I'm sure you are not in the “Tea Kettle Paranoia Brigade” using bogus stories about “how the EU is intending to legislate-away Britain's Tea kettles” I remain open to the evidence that will sway my opinion

Everything changes. Institutions evolve. Complaining about change or evolution is like the spouse complaining ”that his partner's aged, and he didn't sign up for that”. Nothing stays the same. Mere evolution with the times is frankly insufficient ground for divorce. This is not to deny there aren't ever grounds for divorce. There are. I've just yet to hear them well-articulated by Brexiteers. And for those who make the economic case built upon new potential trade - I've yet to see this potential "time-weighted or probability adjusted - which is essential to cost vs. benefit analysis.

within which Britain would be merely a "member". 

All countries are “merely members”..  All have rights and obligations. The matters of the community are mostly pragmatic – not grandiose, or for most except the UK, contentious. Therefore, I am suspicious of exceptionalist arguments, that either accuse other members or believe they themselves should be conferred extra-special rights by history or aggrandized self-opinion.  Britain is a small nation in the world, with rich history and tradition. Contrary to the view of Euroskeptics, the UK is important in the EU, playing an vital role, from which it derives enormous benefit – not least peace and growing prosperity of its neighbors. At its worst, the UK might consider the cost  “a small net annual prosperity dues”  - i.e. an immunization against the considerable costs of cost of war, autocracy, corruption, breakdown in the rule of law etc.

Worse, it has become clear that the power driving the new EU Nation would be centred on Berlin and Frankfurt with its Admin Centres in Brussels and Strasbourg so as to save face for the French. 

I appreciate there some British suspicion and jealousy exists. But to me as a detached American observer, living in Britain with a European Passport, it appears that the neutral Belgians got the Senior Admin, the French got the Parliament (some spillover bens to Germany), the Dutch got the judiciary, the Danes got the Environment, the Germans took the ECB, & the Brits got The City as the central Financial & Insurance capital, AS WELL AS the Euro equiv of the FDA . I think the view painted and held by Euroskeptics is a bit paranoid. On the surface, the Germans appears to get the raw deal, paying most and getting least. The Commission doesn't appear skewed, but a fair representation of the community. If anything, voting history suggested Germans have historically sided with Brits, and the UK exit will be most sorely missed by the Germans. More comprehensive research by the LSE suggests this is isn't reflective because there are different political approaches amongst members that skew results (i.e. much coalition-building/vetting happens before official votes, and it's here where Brits have been most effective (and valued by Germans). It's incumbent upon skeptics to make a more substantive case that Britain is somehow on the verge of getting shafted by an enlarged Community and Commission (that it must be said, the UK themselves were ardent supporters of).  Some even argue further that the EU was a conspiracy set up for the benefit of France. I would liken this to the history of the internet which was founded to connect a few physicists, but now has evolved as the most important tool for mankind, with creators accruing little to no benefit. Whatever the EUs origins, the present system is quite distant in the most positive sense, while the benefits are more universally-shared and felt among all her members.  

This is an intolerable drift towards a European political configuration that Britain fought two great wars in the 20th Century to prevent. 

If one were to distill the war and it's aftermath, one might say, Britain fought two great wars to diminish the likelihood of having to fight further wars. Oh, yes politics were dirtier and less transparent in WW1 (this isn't the venue for rehashing UK diplomacy of the era, and WW2 might have been avoided altogether if the French had only heeded JMKeynes. Britain's own enthusiastic support for enlargement was as much predicated upon the desire to consolidate free-market liberal democracy in Eastern Europe (for the same reasons as membership had been extended to the Italians, Spanish & Portuguese as they emerged from struggles with isolationist authoritarianism) as the desire to extend and reap the benefits of a single common market  As an American with a sense of history, I would argue my country didn't fight two world wars in Europe to see Europe splinter and the continent become a quarrelsome door-mat for Russia  We fought the wars, created, funded, supported  Marshall Plan, NATOetc.  to NOT fight another war, to insure spread of democracy and self-determination, to prime European markets and consumer demand for US good/services, and yes, to contain the Soviets and illiberalism. Little of that rationale has changed, even of the commitments and rules have altered with time.

Furthermore, the EU is not democratic and may soon not even be liberal. 

Citing the possibility that in the future the EU may become illiberal as a reason or cause to Brexit is rather like filing for divorce because you suspect that, one day, hypothetically, your spouse might have an affair. This is absurd logic, and even worse national behaviour as a state and party to existing treaties.

There are many forms of democracy and the UK's own “first-past-the-post” is but one (and itself highly flawed), even before considering the “House of Lords”. By your own definition of “undemocratic", the UK's Prime Minister herself is illegitimate since there is no direct election by The People, of UK PMs, and Mrs May even less so. But this hypocrisy rarely silences critics, or sets them to work on bills to yield more power to the UK People. You've left out the reason that some use positing the superiority and longevity of UK Democracy at Westerminster as much stronger than than on the continent. I, too, hold the UK's democratic tradition  in high esteem. At then time, I also marveled at the traditions and longevity in Athens, and in Rome. But longevity, as demonstrated by our Greek and Roman forebearers, says little about the future. If anything, it portends darker days.

The lack of democracy is not only evident in the fact that EU laws are almost entirely manufactured by faceless and overpaid bureaucrats.  

Euroskeptics and Brexiteers make much of “EU Laws”. In the main, they are either related to development of the single market or are laws that are the lattice binding nations to their agreements/responsibilities and conferring, and  importantly protecting  rights among their citizens, rather constricting their individual rights. As an individual citizen, this is decidedly reassuring to know. Perhaps Brits will only appreciate this benefit AFTER they suffer from the indignity of fascism or authoritarianism. Continentals understand its value presently for obvious reasons.

For most UK citizens, their laws are manufactured by faceless bureaucrats whom they don't know, and most often, didn't vote for, who get paid much more than them, and have staff (often family members) who are also faceless. However true this argument may be, it has problems. First, what  IS a “faceless bureaucrat”? This is a classic Tim Bell turn-of-phrase that sounds ominous but is insidiously demagogic. Commissioners (presumably the faceless bureaucrats you are talking about, are the A-Team of each member country. Leon Brittan, Chris Patten, Neil Kinnock, (of sorts) Catherine Ashton, UKs last four Commission Representatives hardly seem nameless or faceless. We may not know the A-Team from each others' countries, any more than Brit's know MPs other than their own. But they are appointed by the delegated representatives, elected by the people for each member country, and hardly faceless. Most UK policy and directives are made by appointees, appointed by elected delegated representatives, or career members of the civil service. It is true that the Commission are the sole introducers of legislation, but member states directly, and parliament ( who often brings ideas to the commission to introduce) also are part of the process so it's just simply wrong to characterize the producers of legislation as faceless bureaucrats.

Over-paid & Over-privileged? I sympathize with this claim and think member nations should make clear through their commissioners that IF you're going to suggest members tighten belts and restrain pensions, it might be best to set the good example. Headline egregiousness is typically focused on the 28 EU Commissioners. It's doubtful EU impoverishes its lower level civil servants, but it's always been with the UK government's ability to bring this to the fore. Interestingly, one hasn't seen the Brexit MEPs relinquish portions of their salaries to prove the point by example, nor has it gone unnoticed that Brexit MEPs were less-than-restrained when it came to claiming their own expenses. Nor did Brexit MEPs set the example for attendance at their respective membership committees  (which were appalling). On the other hand, UK's maligned faceless bureaucrats, from Leon Brittan to the recently resigned Lord Hill were all deemed to extraordinary Representatives of the UK's public interest, and extremely well-regarded Team Players and managers of their respective portfolios within the commission. Here, there is disconnect as the Brexit MEP slackers mooched and whinged for parochial political gain, while the lavish layabouts worked their asses off.  What one CAN accurately say, is there is a communications failure, be it the UK Press (for it's own commercial advantage or for benefit of the political  views of its patrons and shareholders), or just the arcane and boring nature of the majority of the work of the commission. NOT unimportant – just less-than-newsworthy  in the Fleet St. sense

Even the apparent democracy of the EU Parliament is a sham. In the U.K., for example, an MEP is chosen by the Party List form of proportion representation. The latter guarantees that the actual MPs close to top of those list will become elected. The selection is made by a few Party Managers and thereafter hardly any potential voter has any idea or interest in who is meant to be representing them in Brussels. In other words, it's a stitch-up.

Many representative democracies have found proportional representation MORE democratic than first-past-the-post. I agree with them, and think first-past-the-post is less well-suited to representative democracy especially in the 21st century where identity and interest is truly more fragmented than ever before and large parties are finding it increasingly difficult to aggregate and represent The People's majority will.  Proportional Rep results in the majority in and around the pragmatic center coalescing to do the right thing for the most people in the Public's Interest. I fail to find fault in this approach, but appreciate the strangeness for the UK as an outlier democracy. One needn't recount the flaws in first-past-the-post (Just look at Trump!), or that Lib Dems  could win  8% of the popular vote & 2% of seats, or SNPs with 5% of vote & 10% of seats or admittedly UKIP with 12% yielding just 1 seat. True representative democracy – that truly represents the variety of political interests NOT one's parochial local geography is unfamiliar, but upon reflection, more thoughtfully democratic

Thereafter, the MEPs need to no work, they oft n pay their partners as PAs and generally live it up (often with their mistresses whilst in Strasbourg and Brussels).

It appears as if your description by UK Eurosceptics and UKIP MEPs characterizes rather well the Brexiteer MEPs. Or embarrassingly for that matter UK's own MPs, across all the parties.  I cannot defend the rest of the MEPs, but at best it makes the Euroskeptics and Brexiteers hypocrites. If reform is warranted the are plenty of avenues to purpose before throwing the toys from the pram and sacrificing the project that has substantially contributed to uninterrupted peace and one of the longest periods of of the most profound economic prosperity in modernity.

Pay and pensions are high. It's corrupt and unreformable.

Yes on pay and pensions, and categorically, no on reformability. I believe almost everything can be reformed, and hold no such strident fixed ideas. Each and every day is a new day. Just look at the east of Germany or the pragmatic evolution of German labour unions. Anything is possible The political importance and economic advantages conferred by the EU are far too important to jettison over parochialism, nostalgia, or petty pessimism based on some queer form of exceptionalism.

David Cameron didn't want Brexit, he just sought some help from Merkel, Hollande and The EU to get some control of the UK's borders. And why the hell not? But he got nothing. Therefore, I would suggest, if this is a cock-up, those responsible are not the British. In particular, a bit of foresight from Merkel would have avoided it. Sometimes there is more to geopolitics than just trade and economics. Otherwise, why should Britain not have caved to the Germans in 1939?

I am personally sympathetic to Populist fears on immigration. Not because I fear immigration itself (all evidence suggests it IS a positive), and not because I think it will continue ad infinitum (it WILL reverse as Blighty is squalid compared to compared to most of the continent), but rather because UK is most densely populated member by a wide margin, and the stresses ARE exacerbated by Tory indifference & austerity to investment needs (education, healthcare, roads, transport) to accommodate and therefore profit from the inflows. So while its true that few continentals appreciate just how densely populated it is in the south of the UK, successive UK Govts must share a large portion of culpability. One cannot have all the benefits of immigration without bearing investment costs which BTW are long-term investments with long-tail benefits (lower dependency ratio being primary) along with improved infrastructure & enhanced skills-based competitiveness.

For domestic political expediency, the UK made little effort to throttle immigration pressure from non-EU origins, nor did they make reasonable attempts to modify welfare-pulls (totally-free point of use NHS, generous in-work benefit etc). The sovereign UK parliament and Govt had the freedom of UK policy prerogative. Which is their choice, but one elicits little sympathy by throwing a tantrum and making threats, when the Club's functioning is dependent to the greatest extent possible respectful cohesion to one's commitments or else other members (and their constituents) will ask why the UK is allowe to free-ride on cornerstone responsibilities when others are making sacrifices. Perhaps, had the UK first attempted to do what was within its formidable sovereign powers to solve its problems, AND not already been the EU Member with the most special deal (opt-out of the Euro, no Schengen, uniquely large fee rebate) they would have received more sympathy and very probably the cooperation on at least some of concessions sought. I've no special knowledge here – just the view of the detached observer. Look, I'm married, and know that negotiating with just one partner  is all-too-often fraught with difficulty and frustration. Yet, I remain married for many reasons - much of which is not economic. I see many others divorce, and believe that will end their problem yet, with a great many, I still see them suffering from the problems they projected onto the focus of their frustration and anger rather than look within at what they themselves can change.

Nothing is perfect – certainly not the EU. Despite it's numerous flaws, it represents positive progress across economic, social, judicial, and even political spheres. Economically, it represents the most ambitous and successful example of a single-market amongst independent states, and has built the infrastructure to extend this from a position of scale and strength. Socially, it has codified rights, opened enormous opportunity for its citizens to seamlessly move, study, work, and travel, as mutually recognizing qualifications across borders. Moreover, it is an important contributor to regions where development has been neglected. Judicially, it has created protections, and avenues of appeal, to citizens treated unfairly or unIawfully BY THEIR OWN GOVERNMENTS, checks without which citizens rights can be more easily be trampled by individuals state for parochial political purpose. Citizens in the UK, with an increasingly illiberal and authoritarian State, more than others, should appreciate the great value in this umbrella.I hesitated when including the political sphere because the evolution of democratic and transparent processes are new and still evolving. But I include it because the EU remains the single most ambitious cooperative endeavor to bring sovereign nations together in whereby each voluntarily yields a bit of sovereignty and accepts mutual responsibilities to other states in the community in exchange for benefits and payoffs whose return are far in excess of what they have paid.

Friday, January 27, 2017

The Uninspiring Antitheses To Populism

Many have written insightfully on the reasons that seem crucial both to understanding Brexit and the parallel populism carrying Trump into office. Richard Baldwin, Branko Milanovic, even Tom Friedman's latest shed much light on the political-economic fractures and their causes. Useful data analyses have teased out the statistics  past and present county-by-county or even town-by-town. There are those like Cambridge Prof Nicholas Boyle, who evaluates the nostalgic psychological shortcomings of the Brexit demagogues, their disciples, and sychophants, so ill-suited to the 21st century, and which might be extended to American exceptionalism. Some like Martin Wolfe and George Magnus are critical of incumbent elites for their accused culpability which allowed this to happen, and still others (like the itinerant Chris Arnade) take an anecdotal approach to give the neglected and the angry representative faces, and a narrative rarely heard. As a “front row” kid who hung (and whenever possible still hangs) with the “back row” kids, I find this illuminating and fascinating, though not specifically useful for understanding how and why our formerly enlightened democracies have descended into illiberalism and absurdist nostalgia.

Inequality, leftoutism, the cumulative impact of technological change and the social and economic globalization that have industrially-hollowed out swathes historical manufacturing, urbanization, immigration, stagnant real wages, diminishing affordability of housing (and the inflation in much of the aspirational basket of goods) exacerbating the effect of stagnant real wages, a Facebook Syndrome that makes it plain and clear how great everyone else is doing and  how crappy one's own life is, rapid technological change, the relentless demise of religion with no spiritual replacement or purposeful endeavor, increased longevity amplifying conservative share of population, as well as the cumulative under-investment (particularly in the US & UK) in public goods such as education, affordable housing, public transport and healthcare, all have a role in explaining the reasons less-astute people might find comfort in Populist ideas that someone else (like The EU) Is The Cause of My, Your's, and All of our Problems (and that Brexit BTW will be The Solution) or embrace the view that reversing almost every piece of progressive legislation and dismantling almost every multilateral trade, financial, social and legal infrastructure that over several generations we, ourselves, have helped build in the world, will somehow improve our lot, and contribute to OUR future prosperity AND Make America Great Again.

Beyond comprehension except when seen against the anti-thesis. First, let's take stock of the obvious: “Globalization” (in the broadest sense) is a powerful force in the timeline of history. It will likely continue whatever the length of the present populist interlude. As the world shrinks socially, economically, and politically, our problems (and solutions) are increasingly transnational. Global social and cultural convergence is, and will, remain rife. Technological change has been rapid and will continue apace.  Trade and international relations are, for the most part, not zero-sum. Winners and losers result from all of these processes. Overall, more people benefit – globally and domestically – than are hurt. However, people who are are hurt by these processes ARE undeniably hurt. Finally, and most importantly, attempts to arrest these processes wholesale will cause the people who are, and will be hurt, to be hurt EVEN MORE (along with many other people who wouldn't otherwise suffer). This encapsulates the prevailing reality of our world, and most thinking people should find the recap beyond dispute.

When it comes to political anger and resentment, there is little distinction between  big losers and little losers, or between real losers and those who only imagine. For doubt avoidance, I am NOT using “losers” in the pejorative deplorable sense, but rather as the opposite of winner.  One cannot ignore inclusion of the racists and xenophobes as losers, for they too suffer from  imaginary loss, either having lost, or in the grips of fear of losing their absolute and/or relative sense of identity, privilege, and entitlement, however absurd, bogus, stupid, deplorable one may judge these fears/feelings/sentiments. The last element are The Old People, with a biologic fear of change that monotonically-increases with age – as crucial to Brexit as to Trump.  The resulting coalescence between losers and old people together represent the most combustible of populist tinder  All it requires is the flame to set it alight – be it Brexit, Trump. Immigration, or any inflammatory otherism of one's choosing. Anything to avoid confronting the hard fact of loss. Any lottery ticket to hope – no matter how stupid or deleterious the premise might be to one's self-interest, or cynically-predatory upon one's ignorance. To the populist and the demagogue, this is The Opportunity – not The Problem.

To everyone else, this is the problem. For there are no solutions for bringing steel mills back to the Monongahela Valley, or the textile mills back to Lancashire. New or growing automakers will not lay their roots in Detroit whatever the rhetoric. The economic geography of these regions former success, not accidental to their waterside location, has moved on. Other forms of modern economic geography networking based upon knowledge are now ascendant, and they are not along the Calumet or in Aliquippa. Supply chains are increasingly global, and digital. Tobacco farming is on the wane. Coal is enroute to ignominy. Even Pit Traders are the stuff of nostalgic history. For these losers, there is no anti-thesis that can compare against the  rhetorical demagoguery of populism's “Make America Great Again” or to a lesser extent, Brexit's “Take Back Control”. None. It can't.  The chain of dependencies that ripple out from now-hollowed-out industrial heartlands further diminishing opportunity. One could lay blame – on aloof Grosse Pointe managers, short-sighted capital unwilling to invest, raiders, predators, etc. but it will serve little purpose. Eddie Lampert did not kill Sears. He just profited from it's demise. Historically, the winners helped cushion the blow of the losers, if not explicitly then implicitly, though less so since the drubbing of Walter Mondale for hinting of at a need to raise more revenue. Historically, people moved. Sometimes across borders. Sometimes across oceans. Who, and what remained, rarely thrived without something miraculous. There is no divine entitlement to having a prosperous income where there is no prosperity.  Even the Crusades were as much about men seeking their fortune as anything else. Life IS tenuous. Earning a superior income without copious luck or patrimony IS hard. The reality, for those losers who've lost, or are in the process of losing decidedly is not one of hope and optimism, whatever MAGA promises.

The winners and those of us just plodding along, can do what we can do. Some will say it has not been enough...and they will almost certainly be right in comparison to what might have been done, or what we, as a nation, can afford. What we can do is, we can allocate resources and effort to improve education for modernity. We can re-educate those with out-dated or redundant skills. We can provide universal, and mobile healthcare coverage to allow people to move more easily. We can provide a reasonable social safety net for those unwilling or unable to move. We can support emergent business with investments in infrastructure that may facilitate their growth. We can attentuate the tax system to incentivize long-term investment for those enterprises that remain. None of these involve militaristic rallies, gimmicky hats with empty platitudes, blaming others for the changing fortunes of modernity's impact or for the  mis-fortune of our economic geography, or for some, our own poor decisions - be it substance abuse or hedonism. Most importantly, none of these things we can (and should do!) penalize the opportunity and futures of the overwhelming majority of citizens, or their hopes and aspirations, beyond realistically and progressively sharing the burden of adjustment to modernity of those less fortunate. Rawls would likely approve and suggest nothing different. Those are the plain and not-too-pleasant realistic alternatives that are before us, that other peoples on this earth are wrestling with, and doing their level best (or not) with which to come to terms.

Unfortunately, this depiction of reality will not win elections. This version irrespective of it's veracity, is not inspirational, but pragmatic. It is not intentionally dark, nor does it, or should it portend hopelessness or despondency. Resourceful people and regions can reinvent themselves. They can overcome adversity, with vision, investment, fortitude resourcefulness (not necessarily in that order). They can do this by looking forward to the possibilities of the future  – NOT backwards to a nostalgia that will not be resurrected no matter how many trade agreements are shredded, new minorities persecuted or patriotic hymns sung. If anything, these new people, these immigrants are your hope – our hope - not our villains  They were the reality of our past. They are the common bridge between the past and the future.

As difficult as it is to counter the siren calls of Populism, we, the majority, must take responsibility our failures. We must accept that we have been unable to outline a future and attendant policies any more inspiring than:
“It sucks for you, but not as bad as it could suck with the Populist narcisstic misogynist idiot” .

Or leaving aside the ad hominems:
 “Yes even though it sucks for YOU, at least with us and our “policies”, there is a non-zero probability it won't suck quite as bad for your kids".

Or how about:

"Well, at least with us in power, there might be some medicare and public transport when you get old and you *might* be able to drink the water. But don't count on that prosthetic knee..." 

Maybe this is better?:
"No really, believe me, just believe me: those scary looking dudes hanging down at the local weren't foreign...they just look foreign. And besides, they really won't hurt you"  

All this is pretty bleak compared to inane but hopeful  platitude of  "Make America Great Again".
One last attempt:
"Honestly...we'll do the very best we can and we will try very very hard not to enrich ourselves at your expense because we actually do care about policies that will help us in the future be the best we can be..".

Whatever HRCs flaws, this lack of an inspiring narrative wasn't her  fault. Progressives have been stymied continuously on so much social legislation that addresses the interests of the losers, and/or helps cushion their loss – from  education, and housing to progressive taxation. If and when we emerge from what is setting up to be the greatest self-inflicted episode of self-harm seen in the modern era, I sincerely hope that pragmatic sanity will help us try and solve our common problems with integrity and common sense and decency.In the meantime, I challenge all of you to define the positive narrative to address the challenges we face. Failure to do so could result in an even longer dark winter of discontent...

Wednesday, January 25, 2017

Nothing Cures Populism Like Populism

Though skeptical by nature, I tend towards the optimist. The infectious idealism of my mother is difficult to quash. I would like to believe that sound reasoning, so-called sensibility, could sway, teach, influence, impact, attenuate, educate ameliorate, moderate and contribute towards the evolution in the opinions of those under the influence of angry populism. But it can't.

If, like Jimmy Stewart's "It's a Wonderful Life" one could go back in time with the knowledge one has now, what would you tell the people of early 1930s Germany? of 1930's Italy? 1917 Russia? 1975 Cambodia? 1979 Iran? Would you plead with each of them NOT to make the mistake they were each about to make? Each of these shit-shows of suffering most importantly burned Populism as their fuel. Each sold a set of ill-suited solutions to what were mostly mis-diagnosed or the wrong problems altogether. Yes, each had their own issues of place and time, but in all of them, the whim of The People was usurped by the demagogue who history has judged very unkindly...for millions of irreparable irreplaceable reasons. So, of course you would plead, like a Cassandra, with your perfect knowledge of the future that you have seen with your own eyes. You would do everything in your persuasive powers... 

The thing is, in each of those situations, they, i.e. The People, would've all told you to fuck the fuck-off before they trampled your gonads, cut them off, and fed them, and the rest of you, to the dogs. The thing is: you can no more intervene to stop populism once it's left the station, any more than you can tell your kids not to do the stupid shit they will want to do, and are going to do. They can not, will not, believe you or obey you – certainly not because you know better. It is beyond their capabilities when otherwise possessed, be it by FOMO, ideology or mere wishful delusion. Of course, as a parent, (or well-reasonably well-trained, mature, observant non-dogmatic macroeconomist) with more knowledge YOU probably do know better. It's NOT the parental aspect that makes you know better since THAT confers no god-given right. It's the knowledge and experience. Yes, yes, I know that it sounds arrogant. It reflexively causes the: , "who the fuck are YOU that YOU know better, you smart-ass?" response, or the devilishly cleverly dismissive smarm of Michael Gove Fucking experts, right? One needn't spend too much time defending the role and value of so-called experts, as the idea that somehow one would embark on cancer treatment via advice from a KFC clerk, or have one's dry rot treated by your hair stylist is absurd. Moreover modernity IS complex and getting more so every day. The common (and reasonable) response to this challenge is to consult those wiser than you. Young people who ignore informed advice have the excuse of a still-developing forebrain in one's youth. Mature citizens under the sway of populist delusion have no similar excuse The abuse-to-come will be self-inflicted be it from a natural predisposition to conservatism or authoritarianism or any of a multitude of behavioural biases that prevent reason from entering their thick and stubborn skulls, or responding to new information it reveals itself and changes .

And so the young will do what they must do. They will learn the hard way. “Learn by experience” is their catchphrase, and as a parent, I can only only hope that with any luck mine will prove sufficiently less stupid than is required to teach them their lessons without mortal endangerment to themselves or others. But for the entranced masses for whom Populist rhetoric is the panacea - feeling as if it will cure all their ills (and asthma too!), I can only pessimistically suggest that “nothing cures populism like populism”. It is not coincidental that both Germany and Japan, poster-children for the Last Populism are emerging as the present beacons of liberal enlightenment, while the USA & the UK, the two countries who've not experienced the perils of demagogic populism in modernity have slid dangerously far towards the illiberal abyss – dismissive of any and all warnings that there even IS an abyss. 

The only ray of hope I see is that it numerically remains a 50/50 divide. But this is offset by the reality that the levers of Power are in the hands of The Populists. This is true in legal and administrative halls of government, in the media and mediation of information, and the direct instruments of law & order as expressed through the police, intelligence services, and home guards. This makes it feel as if Populism is more numerically ascendant, and makes expressions of opposition and dissent not only more challenging, but physically, economically and mentally more perilous. 

Of course, I think we should and must fight in all spheres, and not shy away from the inevitable battles ahead, in whatever forms of protest and dissent are available. But I am privately resigned that people possessed by Populism, will only learn from their own bitter experiences (or worse carnage of neighbours and loved ones) what are its true costs...

Wednesday, April 06, 2016

On Selling Short

Oh, roller-skating is exciting,
   and so are volcanoes too.
And a good old-fashioned blizzard
   will put you in a stew;
But of all exciting pastimes,
   or any kind of sport,
There's nothing quite so thrilling
   As the game of Selling Short.

It isn't merely selling
   something which you have got;
It's much more complicated -
   You sell what you have NOT.
And the thing that makes exciting
   (if you don't believe me - try it)
Is that after you have sold it
   You have simply GOT TO buy it.

And so, when you go to buy it,
   If you have to pay the price
Higher than what you sold it for -
   That isn't quite so nice.
And the market is most disobliging -
   Though no one seems to know why -
For it's always down when you HAVE to sell,
   And it's up when you HAVE to buy.

(From Sophronia Tibbs "Stock Market Quotations", published 1926 by John Day & Co.)

Tuesday, March 15, 2016

So Long Pershing Square

Farewell then
Bill Ackman,
"Activist investor".
Whatever
that
means.

You made
a few good trades,
and a couple of friends
along the way
(like Ezra Mirkin,
and some guy you met
in a cab).

You also made
some stinkers,
and a bushelful-o'-enemies -
on The Street,
in Congress,
at the SEC,
and the DOJ
(to name a few).

"Shootin'-The-Moon"
was your
strong-suit,
but
risk-management
was not.

Which is jolly-fine
when it works,
but rather not
when clusterfucked it doesn't.

You wanted fame,
but got Valeant infamy.
Because
it's likely
that you "lost"
more investors' money
than you ever
made. 

Wednesday, February 24, 2016

Upon seeing the miraculous photo of a headset-less Mark Zuckerberg walking through an Oculus Sea, I thought that this post, written in 2012 was just as, if not more apt today than when it was written. All comments most welcome. 

Pleasure Principles


“What will fill the vacuum formerly occupied by religion?”

The most thoughtful, as well as the most memorable wedding gift my spouse and I received in 1993, the year of my first (and only) marriage, was neither the most expensive, nor an object. Rather it was a “Brunch” - that uniquely American invention deplored by Anthony Bourdain in Kitchen Confidential as a reliable though odious route for restaurants to recycle anything and everything left over in their refrigerator and pantry. I learned other useful pointers from Boudrain, (who since parlayed that success into a TV Celebrity status that sufficiently provides for his habits), such as never eat restaurant fish on a Monday, and if you're a foodie and looking for best execution, avoid Fri and Sat evenings like the plague., etc. But I digress. This 'Brunch' was a simple but special affair in that it included the company of [the late] acclaimed author, Chaim Potok, and his lovely wife Adena.

Who is Chaim Potok, you might ask? I'd read several of his novels, independently, following on the heels of those  by Nobelists Saul Bellow and Isaac Bashevis Singer, though before I'd been introduced to works of Philip Roth. All their voices rang true. All chewed upon the clash of the traditional with the modern. All seemingly lamented the loss(es) of what was, even when (reluctantly) accepting the victory of modernity's “progress”. And they all struck some chord within me, each ruminating in their own perspectives and style upon issues still-raw-and-contentious (in my own family), growing up as I did on the generational cusp, and witnessing my parents wrestling with theirs over the same.

I think Potok stands out as his breadth of thought was more encompassing. He was first a Rabbi, then a writer, also a theological academic and philosopher (PhD Penn, Philosophy) as well as a graphic artist, and playwrite, though the arts were his first love and a source of conflict with his own (traditional) parents. His  timeline reflected this same struggle: from indoctrination and orthodox study sliding towards the increasingly secular graphical artist and thinker. He may not have been the superior novelist of the genre shared by the four eminent writers, but he probably was the most eclectic and adept thinker. His experiences were varied: an army Chaplain, a rabbi, a teacher, an editor, writer, an artist). Bellow's and Roth's characters and dialogue might have been more realistic, Potok stretched the boundaries of thought further than the others. Like the great Jewish minds (unlike those of current-day Likud), Potok ruminated thoroughly and saw things not categorically, but nuanced – context within context within context.

Beyond these spartan observations, there is little I can add. We drank coffee, and chatted about our experiences, and about faith. I made no effort to hide my lack thereof, though I couched it in the agnosticism of the empiricist versus certitude of the militant aetheist, which was more useful for friendly discussion than Dawkin's axe-wielding approach. More coffee and cakes, and the conversation drifted from the first to third person, and modernity's impacts upon religion. I noted that religion was useful historically as a means control. Fear of God, his wrath (for the Jews) or Hell (for Christians) were powerful tools. And whether a tool for purposes of control, or more recently as panaceas for the spirit, there is in modernity, I suggested, a gaping hole in the psyche and in one's preoccupation that was previously occupied by religion. “What”, I continued, did he “think might or will replace it???!!?”

He pulled on his whiskers for a long time, looked upwards towards the heavens, and then stared deep into the depths of his half-filled cup before meeting my eyes and saying more categorically than he had about anything to that moment ......”Hedonism”. “Hedonism will fill the void...”, and for the first time, I saw resignation on the face of this otherwise thoughtful optimist. It is the same resignation floor traders must have felt as transactions went "upstairs", or that which strikes value-oriented reversion traders horse-whipped by seemingly less-than-explicable momentum, or an allocator feels when assessing the new normal of what used to be the risk-free rate. It is a distinct feeling that the sense one previously made of the world has been palpably altered, leaving it a less-hospitable place as a result.

Conversation rebounded from the after-effects of this pronouncement, for it was clear he knew that however depressing the prognostication, there was nothing he could do. He could analyse this wave, indeed, he could explain it. But he knew it will be as it inevitably will be. Efforts to change the direction of such a tide would be futile. I understood he was not whining. Nor was he living in the past. As was the case with his literature, he sought first and foremost to understand what was going on around him, and make sense of it, rather than tell us how it should be.

In 2012, it seems ironic, that mired in debt with unemployment rife, that our Grasshopper-like spirits' gaze is, as Potok forecast nearly two decades ago, firmly fixed (and growing) upon hedonism. Not spiritualism or New Age-ism, but full, unbridled "Whatever!" I see it manifested in demagogues pandering "7-Minute Abs" solutions, to problems of marathon proportions. I see it in my eldest's seeming addiction to fatuous social networking, or under the spell of inane traditional media at the cost of reading or doing. I see it in the increasingly stylized beach or ski holidays. I see it in the untempered expectations still being conjured and polished by companies and their Madison Ave agents. I see it in the politicians' promises to restore what Americans' believe is owed to them.   

But is this not natural? Should hedonism be a pejorative?  To the extent it plays a part in fueling expectations and pursuit of a lifestyle for the individual that is unsustainable for the group, then yes. To the extent that it prevents sober or pragmatic evaluation  of what needs or might  be done to pursue even weak-form sustainability, then yes. To the extent it discounts the longer run policy pursuits, for the short-run, then indeed, yes. To the extent it encourages anti-social behaviour to finance parochial hedonism, then yes.  To the extent it fuels near-unprecendented greed at the expense charity yielding a coarser way of life for the benefit of parochial pleasure and the privilege of the yet unborn, then yes, it is a pejorative, and we should lament its expansion in filling the vacuum.

Unlike the Apocalyptors and Tin-Foil Hat Brigade, I do not believe 2012 will be the year of the Return of Barter or Oblivion For Mankind, and while it may even surprise to the upside given the hugely bearish expectations of the market and anti-European shills, I do think it will be an interesting year for observing what happens when hedonistic rubber meets the austere reality of the road ahead of us [all].