RE: Science and Ideals.

[Curtis Burisch]

On Sun, Sep 21, 2008 at 1:26 PM, Charlie Bell
<[EMAIL PROTECTED]>wrote:

> You've hit on something that's both profound and irrelevant.

The universe is stranger than we can imagine :)

C

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RE: For the sake of discussion...

[Curtis Burisch]

On Sun, 21 Sep 2008, Julia Thompson wrote:

>> i'm not ashamed to admit that i make lots of mistakes.  does that make 
>> me an idiot?  that's how i learn...

>Well, if that's how you *learn*, you're still open to learning, and if
>someone is open to learning, they are, IMO, *not* an idiot.

Insanity: Doing the same thing over and over again, and expecting
different results.
 -- Albert Einstein

c

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RE: For the sake of discussion...

[Julia Thompson]

On Mon, 22 Sep 2008, Curtis Burisch wrote:

> On Sun, 21 Sep 2008, Julia Thompson wrote:
>
>>> i'm not ashamed to admit that i make lots of mistakes.  does that make
>>> me an idiot?  that's how i learn...
>
>> Well, if that's how you *learn*, you're still open to learning, and if
>> someone is open to learning, they are, IMO, *not* an idiot.
>
> Insanity: Doing the same thing over and over again, and expecting
> different results.
> -- Albert Einstein

If you make a different mistake each time, that doesn't fit the 
definition.  :)  And if you're actually *learning* from your mistakes, 
you're not likely to make the same one too many times.

Julia

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RE: For the sake of discussion...

[Curtis Burisch]

 On Mon, 22 Sep 2008, Julia Thompson wrote:

 i'm not ashamed to admit that i make lots of mistakes.  does that 
 make me an idiot?  that's how i learn...

>>> Well, if that's how you *learn*, you're still open to learning, and 
>>> if someone is open to learning, they are, IMO, *not* an idiot.

>> Insanity: Doing the same thing over and over again, and expecting 
>> different results.
>> -- Albert Einstein

>If you make a different mistake each time, that doesn't fit the
>definition.  :)  And if you're actually *learning* from your mistakes,
>you're not likely to make the same one too many times.

Precisely his point :)

C

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RE: For the sake of discussion...

[Ronn! Blankenship]

At 05:33 AM Monday 9/22/2008, Curtis Burisch wrote:

>Insanity: Doing the same thing over and over again, and expecting
>different results.
>  -- Albert Einstein


Someone (perhaps on this list) once said that was a pretty good 
description of what they did every day in their job as a computer 
troubleshooter.


. . . ronn!  :)



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Are you sure he's not just a SF fan . . . ?

[Ronn! Blankenship]

. . . or maybe a college professor?




. . . ronn!  :)



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Re: Are you sure he's not just a SF fan . . . ?

[Julia Thompson]

On Mon, 22 Sep 2008, Ronn! Blankenship wrote:

> . . . or maybe a college professor?
>
> 

I got about halfway through and pegged him as "Burner".

Sent the link along to other Burners to get their opinion.

(About the best I do is, if I go into someone's *house* with a take-out 
meal of some sort, I take all the trash from it with me and put it in my 
*own* garbage, instead of burdening theirs.)

I want a worm composter.  I can't think of a nicer thing to do with banana 
peels, for one thing

Julia

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Re: Science and Ideals.

[Nick Arnett]

On Sun, Sep 21, 2008 at 5:49 PM, John Williams
<[EMAIL PROTECTED]>wrote:
>
>
> Some examples would be raising taxes for a national health care plan,
> barring
> a new store from being built on private property, banning short-sales of
> stock,
> raising the minimum wage, import/export tariffs, banning internet gambling,
> restricting offshoring, supporting a bailout of the financial industry
> using taxpayer
> money, windfall profit taxes, price ceilings on gasoline, repealing NAFTA,
> farm
> subsidies, banning smoking, trans-fats, etcI could go on, but that will
> do for
> now. By the way, I do not mean to imply that you support these practices. I
> am
> only giving examples.
>
> >  Is  it an opposition to broad notions of economic and social justice?
>
> Huh?


I'm struggling to see those as examples of people imposing their will on
others.  They seem to be examples of people imposing their will on
themselves -- decisions made via the processes of law and justice, whose
ideal is quite the opposite of imposing one's will on others -- they are
intended to allow a nation to choose the rules it imposes on itself.  That's
democracy in action, except when it has been subverted by those who use
their wealth and power to corrupt the system.

Did you mean that those are all examples of such corruption?  That they are
unlawful imposition of ideals by a minority against the majority?  Or
perhaps you don't believe in self-rule?  I'm not getting the big picture
here, as I hope I have made clear.

As for my second question... For example, what ideal is being imposed when
raising taxes for a national health care plan, if not social justice?

Nick
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Re: Science and Ideals.

[John Williams]

Nick Arnett <[EMAIL PROTECTED]>


> I'm struggling to see those as examples of people imposing their will on
> others.

Pick one that you are struggling with and I will be glad to explain if you 
really
cannot see it.


  

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RE: Science and Ideals.

[Dan M]

Well, I'm finally back with power.

> Dan, why do you say Richard's  history lesson is an aside to the main
> thrust of your argument? Because most ancient regimes did not place value
> on individual human rights, and are often replaced with different despots?
> Of course some despots are worse than others, what else is new?  Wouldn't
> you agree that the human race has been making progress since the
> enlightenment?  What do you think are the reasons for that?

I think the human race is better of now than before the enlightenment.  I
attribute this to these reasons.

1) The increase in per capita wealth allowed for a structure in which people
could have wealth without pushing folks to the margins.  Historically,
humans have had marginal existences.  For example, in "The Birth of
Christianity" by John Dominic Crossan, Crossan argues that if perfect
Christian charity and sharing were practiced in the Roman empire, it would
push back starvation no more than one generation. To have enough wealth to
allow one's sons to study full time and become scholars required having
access to the products of many people. 

This slowly changed with the advent of new technology, such as the horse
collar and new techniques, such as three crop rotation in Europe.  But, the
industrial revolution allowed for great leaps in productivity...which
allowed for a different type of model.

2) The Enlightenment brought forth new ideas about the rights of individual
human beings.  They weren't, of course, developed in a background, but were
well grounded in earlier arguments made within Christianity.  In a real
sense, they were the direct descendents of Erasmus, who took a middle, and
reason based position during the reformation.

3) Two Republics formed out of the Enlightenment: the French and the US.
The US was extremely fortunate in the people it had to found its Republic.
Not only were they great thinkers and orators, they developed a novel answer
to the age old question of who guards the guardians.  The answer was to use
separation of powers to have the self interest of one guardian motivate him
to watch the others guardians like a hawk.

4) The US was lucky enough to have the North win the Civil War.  If the
South had won, most (including Lincoln) believed that the West would follow
suit and secede.  We were very fortunate to have Lincoln, especially since
there is a great risk in a very non-experienced leader run the country.
But, even given his skills, and his ability to break the law and then pull
back within the law, we had to have external events go for us.  If Egypt
didn't have record cotton harvests that coincided with the war, and the
mills of England needed Southern cotton to keep going, things would probably
have turned out differently.

5) Key leaders in the US relinquished power.  The most important of these is
Washington (a general who stood in sharp contrast to Napoleon), who set a
strong example in stepping down after 8 years.  

6) We were lucky during the Cold War to find ways from having nuclear war,
from the Berlin airlift, to the Cuban missile crisis, to the Yom Kipper War
(when the US threatened to stop any resupply of their allies by the USSR),
to the time when Yelsen (sp) reversed the coup against Gorbachov (sp).

7) The US was not interested in empire.  It didn't keep Germany and Japan as
conquered subjects (the reverse certainly would have been true if we lost).
You can call the US cultural and economic dominance as empire, but it really
is quite different from the USSR, from Japan's sphere of influence, from the
European empires of the 17th-20th centuries.

So, that's a start.

Dan M.



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Dogmatists on Brinlist!~)

[Jon Louis Mann]

> > I'm struggling to see those as examples of people
> imposing their will on others.

> Pick one that you are struggling with and I will be glad to
> explain if you really cannot see it.

john williams42!~)
me?~)
jon


  
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Mistakes

[Jon Louis Mann]

> >If you make a different mistake each time, that
> doesn't fit the
> >definition.  :)  And if you're actually *learning*
> from your mistakes,
> >you're not likely to make the same one too many
> times.

i wish i could learn from making a mistake just once, but sometimes i forget 
what i learned and repeat myself...
jon


  
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Ideals.

[Jon Louis Mann]

> Some examples would be raising taxes 
> for a national health care plan,

forcing people to have free health care?  really?  

> property, banning short-sales of stock.   

but, isn't that part of the blame for the crash?
 
> raising the minimum wage,

should we bann unions, too, and return to child labor?~)

> banning internet gambling

regulate it instead.  government control instead of mob so the revenues help 
reduce taxes, which can be used for things like alternative energy.
 
> restricting offshoring,

save the pla net!~)

> supporting a bailout of the financial industry

here we agree, i say let them go under and bail out people who are losing their 
homes!~)

> using taxpayer money,

for wars?~)

> windfall profit taxes

what's wrong with that?  better to tax the rich, don't you thinK. they can 
afford it.

>price ceilings on gasoline, 

here i agree, tax gasoline more, and use the revenues for alt energy!~)

>repealing NAFTA,

how about a FAIR trade policy?~)

> farm subsidies, 

i say subsidize small family farms, NOT agribusiness.

> banning smoking,

no, but i believe the government should take over the tobacco industry for 
fraud and use the revenues to discourage, detox and treat smokers.

> trans-fats,

definitly, and regulate the entire food industry so health priorities out weigh 
profit motives

> Huh?

are you in opposition to broad notions of regulation, economic and social 
justice?
jon




  
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Dan's Power

[Jo Anne]

Glad to see your empowered again, Dan.  How bad was it?

I know others have posted about their experiences -- the Engineer's brother
lives a little off Trinity Bay & they were in the eye for about 45 min or an
hour.  Their house is at 18 feet elevation, and the water was up to their
crawl space.  Lost some trees, but were OK otherwise, other than being sleep
deprived from the freight train that was outside.  They still don't have
power unless it's just come on today.

Amities,

Jo Anne
[EMAIL PROTECTED]


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Re: ZPG

[Claes Wallin]

Bruce Bostwick wrote:
> On Sep 17, 2008, at 8:26 PM, Ronn! Blankenship wrote:
>> At 07:57 PM Wednesday 9/17/2008, Dave Land wrote:
>>> On Sep 17, 2008, at 3:56 PM, Andrew Crystall wrote:
 On 17 Sep 2008 at 13:46, Dave Land wrote:

> Perhaps the reproduction tax incentive can be on a curve, with zero
> or
> less population growth being rewarded, over-reproduction being
> penalized:
>
> 0 children -- 3 deductions
> 1 child-- 2 deduction
> 2 children -- 1 deductions
> 3 children -- 1 penalty
> 4 children -- 2 penalties
 Congratulations, you just lowered the birth rate again among the  
 very
 people who are not even currently producing a replacement  
 population,
 and the groups who want lots of children anyway are now bitterly
 opposed to the government and are very unlike to listen to anything
 else they say on the matter.
>>> That's OK, I'll just go back to the last save point and try again.
>> I imagine most politicians wish it were that easy in RL . . .
>>
>> Do Over Maru
>>
>> . . . ronn!  :)
> 
> There's a lot to be said for the concept of test simulations, alpha  
> and beta testing, and staged rollouts for social policy.  Those are  
> foreign concepts to most politicians, who seem to prefer the  
> equivalent of making a full-scale production run of duplicates of the  
> first-generation prototype and releasing them to the public with no  
> testing at all, and when people unsurprisingly call tech support to  
> ask "WTF?!", screaming at them for being a "bunch of whiners".
> 
> I for one would particularly like there to be a simulation environment  
> that could be used to catch unintended consequences like these, as  
> well as alpha and beta test environments with some degree of user  
> acceptance testing and feedback, before social-policy bills are signed  
> out of Congress.  Never happen, and I'm probably too much of an  
> engineering-type geek for even thinking about it, but it's an  
> appealing thought nonetheless.

Actually, this happens in Real Life, at least staged rollouts. In 
Namibia, for example, they are now test-driving a Basic Income Grant 
scheme in a limited part of the country for two years, before deciding 
if this is a good policy to run nation-wide.

http://bignam.org

/c

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RE: Dan's Power

[Dan M]

> -Original Message-
> From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On
> Behalf Of Jo Anne
> Sent: Monday, September 22, 2008 4:23 PM
> To: brin-l@mccmedia.com
> Subject: Dan's Power
> 
> Glad to see your empowered again, Dan.  How bad was it?
> 

Well, I was out of town, as was my wife, on long planned family visits.  We
got by OK, the house was fine, just one big down tree and no power when we
got home Thursday.  The hardest part was not knowing what happened to our
house, which we are selling.

Dan

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Re: Science and Ideals.

[Wayne Eddy]

- Original Message - 
From: "John Williams" <[EMAIL PROTECTED]>

> Some examples would be raising taxes for a national health care plan, 
> barring
> a new store from being built on private property, banning short-sales of 
> stock,
> raising the minimum wage, import/export tariffs, banning internet 
> gambling,
> restricting offshoring, supporting a bailout of the financial industry 
> using taxpayer
> money, windfall profit taxes, price ceilings on gasoline, repealing NAFTA, 
> farm
> subsidies, banning smoking, trans-fats, etcI could go on, but that 
> will do for
> now. By the way, I do not mean to imply that you support these practices. 
> I am
> only giving examples.

I would argue that the above are part of the detail of a consensual deal 
between and individual and a state, and therefore part of a meta free 
market.

I am a citizen of Australia, and I have been issued a passport, and am free 
to move to and live in any other country I wish, providing of course I can 
come to a mutually agreeable arrangement with that country.  That agreement 
would include abiding the laws of that country.   If I moved to the US 
(which I wouldn't) part of the deal I would strike with the government would 
be to accept say bans on short selling of stick if the government decided 
that was a good idea, so in the end everything above is part of a free 
market.

Regards,

Wayne. 

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RE: Free Market

[Dan M]

> I have no doubt that insuring banks benefits long term growth. So the FDIC
is 
> helpful. It would be interesting if a Berkshire Hathaway were to start
insuring 
> some  bank deposits, say, amounts over $100K, to see whether we could get 
> at least limited competition in the bank insurance market. 

I presume you know some of the fundamentals of both the banking and the
insurance industry.  In banking, the reserves need only be 10% of M1 

see 
http://www.theshortrun.com/data/Financial/aggregates/msexplain.html

for good descriptions of M1, M2 & M3). 
 
> As for the Fed, they can be helpful in a severe liquidity crunch, such as
during 
> bank runs, but the Fed is more intrusive than it needs to be. I'd like to
see 
> the  Fed keep quiet except in the case of banking panics. I have not seen
anything 
> to convince me that it is anything more than an grand illusion that the
Fed 
> actually has significant control over the economy (outside of a liquidity 
> crisis) by varying short term interest rates. The Fed is a bit like the
rooster that 
> thinks  his crowing raises the sun each day. 


Hmm, as you also mention below, you are rather skeptical about correlations.
What do you base that on?  Let me bring up something you said earlier 


> Sounds like the rooster again, I think. The problem with this sort of
analysis 
> is that  there is a lot of randomness in economic growth figures. I expect
you can 
> probably find a lot of variables that correlate with the data you mention
(have you seen 
> the  graph of global warming versus number of pirates?). You would have to
do a huge 
> statistical study to convince me that FDR actually caused the economy to
change 
> that drastically that quickly. 

Well, I should probably give you a bit of my background here.  I've been
working in physics for the last 30 years or so (finished my Phd Dissertation
1-82 in particle physics) and am fairly familiar with statistical analysis.
I've been dealing with false and true correlations for all of that time.
There are rigorous ways to look at correlations and to ask questions
precisely that decrease the chance at false correlations.

For example, there are a lot of things that went down as global warming
increased, as well as a lot that didn't.  You have a very simple model
(up/down) for global warming and piracy and the chances of false
correlations are good.  Indeed, Monte Carlo techniques lend themselves very
well to this type of analysis.

Another example of false correlations is the correlation of cancer with high
voltage power lines.  The trick involved is to look for a 3 sigma
relationship in any type of cancer.  There are so many types of cancer, that
one of them is bound to have a 3 sigma signal.  Again, Monte Carlo
techniques are invaluable in doing rigorous, straightforward, efficient
modeling of these types of questions.

I've been involved in similar debates to this in the past on Brin-L, and
have done Monte Carlo analysis.  With today's computer speeds, it is
straightforward to run 1 million cases in a few seconds (maybe a few minutes
for complicated analysis).  Further, Monte Carlo's allow/require one to
explicitly instead of implicitly state assumptions.

And, furthering the value of Monte Carlos, the analytical models employed by
the major houses, Freddy and Fanny did not accurately predict the recent
meltdown/Black Swan, but Taleb (who tends to rely more on Monte Carlos and
less on analytical approximations) did.

But,  before I apply the toolbox of techniques I've learned such techniques
to analyzing your and my hypotheses, I'd like to know if it would mean
anything to you.  Are you convincible by numbers?

I'm cutting the rest of your response because I think that a rigorous reply
would only be meaningful if you accept what I've been taught as rigor as
valid. 

BTW, I do realize that economics is no more than a dismal science, but that
doesn't mean that techniques of science cannot be borrowed to look at some
of the historical information. -

Dan M.

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Re: Free Market

[John Williams]

Dan M <[EMAIL PROTECTED]>


> There are rigorous ways to look at correlations and to ask questions
> precisely that decrease the chance at false correlations.

Yes.

> But,  before I apply the toolbox of techniques I've learned such techniques
> to analyzing your and my hypotheses, I'd like to know if it would mean
> anything to you.  Are you convincible by numbers?

Of course, but you do not seem to have understood what I wrote. There are
dozens of important variables that could be relevant, and you have only a
few years of data points during FDR. Are you seriously suggesting that you can
prove that 1 or 2 variables are responsible for the majority of the change in
GDP over a period of a few years? If you can achieve that, you surely missed
your calling as an economist.


  

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Re: Science and Ideals.

[John Williams]

 Wayne Eddy <[EMAIL PROTECTED]>

>If I moved to the US 
> (which I wouldn't) part of the deal I would strike with the government would 
> be to accept say bans on short selling of stick if the government decided 
> that was a good idea,

What if "the government" decided all citizens who immigrated from Australia
should immediately become slaves? Would you accept that?


  

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RE: Science and Ideals.

[Dan M]

> -Original Message-
> From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On
> Behalf Of Doug Pensinger
> Sent: Sunday, September 21, 2008 12:16 AM
> To: Killer Bs (David Brin et al) Discussion
> Subject: Re: Science and Ideals.
> 
> Dan,  I hope that You and yours and your home are OK.  I heard that half
> of the Houston area is still without power, if you're home I hope you're
> among the lucky half.

Power came on, finally, yesterday afternoon.  Thanks for asking.

 
> Dan  wrote:
> 
> >
> 
> Ok, where on the web can I read about the truth apart from us?Can I
> find widespread support for the idea among scientists?

Well, there was a multiplicity of articles in Phys Rev. Letters (_the_ place
for a physicist to publish in the US; Europe has Phys Letters) on the
falsification of local realism. That is what I was talking about, when I
talked about the difficulties of realism.

Science is, well when it's done right it is, not philosophical in its
fundamental nature.  I've worked with folks with a wide variety of
ontologies and epistemologies.  

> Or will I find, as Wiki suggests, that "most physicists consider
> non-instrumental questions (in particular ontological questions) to be
> irrelevant to physics. They fall back on David Mermin's expression: "shut
> up and calculate"

BTW, Mermin may have said it, but Feynman said it much earlier.  But, you
can shut up and calculate and still accept Bell's work on the EPR paradox.
Let me quote the Wikipedia article on the EPR paradox

http://en.wikipedia.org/wiki/EPR_paradox


The EPR paradox is a paradox in the following sense: if one takes quantum
mechanics and adds some seemingly reasonable (but actually wrong, or
questionable as a whole) conditions (referred to as locality, realism,
counter factual definiteness, and completeness; see Bell inequality and Bell
test experiments), then one obtains a contradiction. However, quantum
mechanics by itself does not appear to be internally inconsistent, nor - as
it turns out - does it contradict relativity. As a result of further
theoretical and experimental developments since the original EPR paper, most
physicists today regard the EPR paradox as an illustration of how quantum
mechanics violates classical intuitions.


EPR is probably the best example of non-intuitive QM.  If we limit ourselves
to this, and we agree that when physics and commons sense differ, we take
physics, I think I can make my case without referring to other physics
(except for answering questions about say the inequality inherent in Bell by
pointing to experiments that show the same physics without "resorting" to
inequalities.

The point is that there are certain well verified and long researched
results of quantum mechanics that need to be taken into account into any
philosophical system that has observations as having some validity (i.e.
just about everything except the most extreme forms of idealism and
narcissism).  The Kantian worldview, which I tend to favor, certainly
associates some correlation between phenomena and nomena.

Wearing my scientists hat, I think I know my QM well enough to state the
well verified outcomes of the theory.  When it comes to interpreting those
outcomes, then I take of my scientist hat and put on my philosopher's hat.
So, MWI, Copenhagen, pilot waves, etc. all interpret the same physics. Thus,
I cannot use physics to falsify any of these interpretations (they are just
philosophy).  I can, however, use the QM to state what must be part of such
an interpretation for it to be a proper interpretation of QM (proper in that
it needs to be consistent with the theory it interprets).  

 
> Is there no way to define success in evolutionary terms? Wiki describes
> natural selection thus: Over many generations, adaptations occur through a
> combination of successive, small, random changes in traits, and natural
> selection of those variants best-suited for their environment"  Is  the
> use of best in that description a mere tautology?  Or if I had said best-
> suited would it have changed the meaning of my statement appreciably?

Other posters have pointed out the fact that "best suited" is dependant on
the particulars of the environment, the history of environments, etc.
Charlie may correct me, but I think I recall him stating that there is no
teleology in evolution.

In some cases, such as eyes IIRC, there have been separate evolutionary
developments of eyes, so they could be seen as nearly inevitable.  But
humans, well we're the dominant species and there is recent evidence that we
almost went extinct (50k years ago, I think)...so fittest to survive a given
sequence of events need not be the same as fittest to survive a slightly
different sequence of events.  In other words, we're lucky to be here.

 
 
> First of all, I respect Guatam's credentials, but he's been wrong on more
> than one occasion (remember the guarantee that there would be WMDs in
> Iraq) so his they aren't impeccable.  Second, you state that

RE: Free Market

[Dan M]

> -Original Message-
> From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On
> Behalf Of John Williams
> Sent: Monday, September 22, 2008 5:47 PM
> To: Killer Bs (David Brin et al) Discussion
> Subject: Re: Free Market
> 
> Dan M <[EMAIL PROTECTED]>
> 
> 
> > There are rigorous ways to look at correlations and to ask questions
> > precisely that decrease the chance at false correlations.
> 
> Yes.
> 
> > But,  before I apply the toolbox of techniques I've learned such
> techniques
> > to analyzing your and my hypotheses, I'd like to know if it would mean
> > anything to you.  Are you convincible by numbers?
> 
> Of course, but you do not seem to have understood what I wrote.

I understood.  It is true that I cannot prove my assertions beyond a shadow
of a doubt, just as one cannot prove global warming and the rise of CO2
levels are not just coincidence.  But, I will make a


> There are
> dozens of important variables that could be relevant, and you have only a
> few years of data points during FDR. Are you seriously suggesting that you
> can  prove that 1 or 2 variables are responsible for the majority of 
> the change in GDP over a period of a few years? If you can achieve 
> that, you surely missed your calling as an economist.

There is nothing new in what I'm writing.  I've seen these arguments from
well respected economists.  It's true that economists tend to overstate
their understanding.  But, I have much less ambitious goals.  It is
theoretically possible that small causes are the real source of big effects,
but it is very reasonable to look at big causes for big effects.

Your statement about monetary policy places you in opposition to just about
everything I've read by or heard from economists.  It could be blind luck
that increasing the supply of money increases GDP, and can cause inflation
if and only if the increase in money exceeds the increase in goods and
services.  

Me, I believe that something between the understanding of fiscal economists,
and monetary economists is closest to the best model.  I agree that a great
deal of humility is needed by these folks, because things like the "rule of
7" are not valid, nor is the idea that monetary policy alone can handle
inflation.  But, there are enough data, including the timing of the changes
in the economy after changes in Fed. policy that matches expectations
repeatedly to come up with a reasonable phenomenology.

Your view, on the other hand leads to predictions that counter data.  Yes,
there could be a wealth of unseen effects, etc.  But, allowed that type of
latitude, I could claim just about anything.

Now, for the first order data: government intake, output, inflation and GDP
growth since 1929 (1930 is listed first because it reflects growth/shrinkage
from '29 to '30.

fed   fedreal GDP
recpexpen inflate growth
19304.2%3.4%-3.7%-8.6%
19313.7%4.3%-10.4% -6.4%
19322.8%6.9%-11.7% -13.0%
19333.5%8.0%-2.7%-1.4%
19344.8%10.7%   5.6% 10.8%
19355.2%9.2%1.9% 9.0%
19365.0%10.5%   1.1% 12.9%
19376.1%8.6%4.3% 5.3%
19387.6%7.7%-2.9%-3.5%
19397.1%10.3%   -1.2%8.1%
19406.8%9.8%1.4% 8.5%
19417.6%12.0%   6.8% 17.1%
194210.1%   24.3%   7.9% 18.4%
194313.3%   43.6%   5.3% 16.4%
194420.9%   43.6%   2.3% 8.2%
194520.4%   41.9%   2.7% -1.2%
194617.6%   24.8%   12.1%-11.1%
194716.5%   14.8%   10.7%-0.7%
194816.2%   11.6%   5.7% 4.3%
194914.5%   14.3%   -0.1%-0.6%
195014.4%   15.6%   1.1% 8.7%
195116.1%   14.2%   7.2% 7.6%
195219.0%   19.4%   1.6% 4.0%
195318.7%   20.4%   1.3% 4.6%
195418.5%   18.8%   1.0% -0.7%
195516.6%   17.3%   1.7% 7.1%
195617.5%   16.5%   3.4% 2.0%
195717.8%   17.0%   3.3% 2.0%
195817.3%   17.9%   2.4% -1.0%
195916.1%   18.7%   1.1% 7.2%
196017.9%   17.8%   1.4% 2.5%
196117.8%   18.4%   1.1% 2.3%
196217.6%   18.8%   1.4% 6.0%
196317.8%   18.6%   1.1% 4.3%
196417.6%   18.5%   1.5% 5.8%
196517.0%   17.2%   1.9% 6.4%
196617.4%   17.9%   2.9% 6.6%
196718.3%   19.4%   3.1% 2.5%
196817.7%   20.6%   4.3% 4.8%
196919.7%   19.4%   4.9% 3.0%
197019.0%   19.3%   5.3% 0.2%
197117.3%   19.5%   5.0% 3.3%
197217.6%   19.6%   4.2% 5.4%
197317.7%   18.8%   5.6% 5.8%
197418.3%   18.7%   9.0% -0.6%
197517.9%   21.3%   9.3% -0.4%
197617.2%   21.4%   5.7% 5.6%
197718.0%   20.7%   6.4% 4.6%
197818.0%   20.7%   7.1% 5.5%
197918.5%   20.2%   8.3% 3.2%
198019.0%   21.7%   9.2% -0.2%
198119.6%   22.2%   9.3% 2.5%
198219.1%   23.1%   6.2% -2.0%
198317.5%   23.5%   4.0% 4.3%
198417.4%   22.2%   3.7% 7.3%
198517.7%  

Re: New Zealand

[Euan Ritchie]

For the curious, and in reply to a query about some of NZs laws, here's
a snippet about the beginning for Free Trade talks with the U.S from a
local blog...

Quote:http://norightturn.blogspot.com/

Labour is patting itself on the back over the announcement that it will
begin free-trade negotiations with the USA. Meanwhile, the rest of us
might like to ask how much it will cost and what we will have to give up
in order for New Zealand farmers to make a bit more money. Fortunately,
the US Trade Representative compiles an annual report on "Foreign Trade
Barriers", which is quite informative on the issue. Here's a list of New
Zealand policies the US considers to be unacceptable barriers to trade,
culled from its New Zealand report:

* Restrictions on GM crops;
* Our current pathetically weak labelling scheme for GM products
(informing consumers is a barrier to trade!);
* Import restrictions on potentially diseased food (stopping people
from getting BSE is a barrier to trade!);
* Sane copyright law which recognises the rights of customers;
* Voluntary local content quotas for TV and radio (customer
preferences are a barrier to trade!);
* The Overseas Investment Act (requiring that investment actually be
beneficial is a barrier to trade!);
* Pharmac.

The question we should all be asking is how much, if any, of this we are
willing to surrender so that farmers can get richer. My answer is
"none". All of these policies serve a real purpose; they all benefit New
Zealanders by protecting us from disease, giving us information about
products, ensuring that products actually work, and allowing us to have
a public health system.

:EndQuote

Pharmac is our governments agency for purchasing and subsidising
pharmecueticals used in concert with our health system to regulate
affordable medicines.
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Meltdown

[Dan M]

The meltdown on Wall Street was real, and posed great risk.  If I read
correctly, and I multi-sourced this, there was a short period that companies
couldn't sell short term paper; in other words companies with big assets
couldn't get loans for a day or two that were a fraction of their assets.
Since banks never ever have cash reserves close to the total of the M1
deposit (the US requires only 10%), a bank run can be explosively
devastating.

But, that's only part of it.  European banks have even weaker requirements
on deposits 

http://en.wikipedia.org/wiki/Reserve_requirement

Leaman Brothers (sp) had a 40x leverage.  Deuchbank, I've heard from a good
source, is leveraged 60x.  If it falls, I think it may be impossible for
Germany to bail it out.

Dan M. 

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Re: Meltdown

[John Williams]

Dan M <[EMAIL PROTECTED]>


> The meltdown on Wall Street was real,

The tuna melt I had for lunch was real, too.

> and posed great risk.

Now you sound like a politician, trying to whip everyone into a frenzy so that
they can spend billions of taxpayer dollars to bail out a bunch of rich and 
foolish
"investment" bankers.

Would you care to define your terms? How much risk of how much to whom?

> If I read
> correctly, and I multi-sourced this, there was a short period that companies
> couldn't sell short term paper; in other words companies with big assets
> couldn't get loans for a day or two that were a fraction of their assets.

Not all companies...mainly the companies that had questionable balance sheets.
But that meant all the remaining big investment banks, which derived
a large amount of funding from the money markets.

> Since banks never ever have cash reserves close to the total of the M1
> deposit (the US requires only 10%), a bank run can be explosively
> devastating.

You do realize that the reserve requirement you reference did not apply to 
investment banks? The reserve requirements you reference apply to 
deposit-funded banks which are also FDIC insured, which the investment
banks were not.

Note that I am using the past tense, there are no more big investment banks,
since Bear and Merrill were acquired, Lehman failed, and Morgan Stanley and
Goldman Sachs just converted to bank-holding companies. That will eventually
allow them to be funded partially by deposits instead of by the money market.

> Leaman Brothers (sp) had a 40x leverage.  Deuchbank, I've heard from a good
> source, is leveraged 60x.  If it falls, I think it may be impossible for
> Germany to bail it out.

Which would be good. The equity and debt investors should take the hit,
not the taxpayers. Note, however, that European banks tend to be combinations
of investment banks and deposit banks (think, something like BoA now that it
acquired Merrill). Since the European banks have depositors, and in most cases
some sort of government deposit guarantee, it makes the situation more 
complicated than when a Lehman or Bear Stearns goes under.

I'm not really sure what your point is here. Perhaps you are
implying that we have to use taxpayer dollars to bail out these 
companies because otherwise [some unthinkably terrible thing] will occur?
That is what the politicians are saying, of course. But politicians always
want to look like they are doing something, anything, preferably to save
their constituents from an unspeakably horrible fate, and it is not the 
politicians
own money that they are spending, after all.

The reality of the situation is that almost all of the companies that hold 
various
bad assets have more than enough shareholder equity and senior debt to 
absorb all of the losses. For example, take Merrill Lynch. As of Aug 31,
total assets were $989B, and shareholder equity was $42B, for a gross
leverage of 23.5. But there was $200B of long-term bondholder debt. It would
take $242B of losses from the $989B in assets before the customers and
counter-parties would be at risk of losing a dime. But our wonderful Treasury
Secretary wants to step in with $700B or more (there is no cap, it just cannot
exceed $700B at any one moment) to overpay for these bad assets that companies
are carrying on their balance sheet because they made bad investment decisions.
I can only guess that Paulson is doing favors to his former colleagues at 
Goldman
Sachs and elsewhere, because he certainly is doing taxpayers no favors.


  

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Re: Free Market

[John Williams]

Would you care to inform me what "my theory" is that you repeatedly refer
to, claim all economists disagree with, and proceed to list some data and
some anecdotal evidence that you say disproves "my theory"?


  

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Re: Meltdown

[Julia Thompson]

On Mon, 22 Sep 2008, Dan M wrote:

> Leaman Brothers (sp) had a 40x leverage.  Deuchbank, I've heard from a 
> good source, is leveraged 60x.  If it falls, I think it may be 
> impossible for Germany to bail it out.

The general SEC requirement had been to limit it to 12X.  An exception was 
made in 2004 for 5 companies - Goldman, Merrill, Lehman, Bear Stearns, and 
Morgan Stanley.

And, since I know someone is going to yell, "Cite!", I will:

http://bigpicture.typepad.com/comments/2008/09/regulatory-exem.html

(Yes, this cites other sources.  There was a limit as to how far back I 
was going to go.)

Julia

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RE: Free Market

[Dan M]

> -Original Message-
> From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On
> Behalf Of John Williams
> Sent: Monday, September 22, 2008 10:10 PM
> To: Killer Bs (David Brin et al) Discussion
> Subject: Re: Free Market
> 
> 
> Would you care to inform me what "my theory" is that you repeatedly refer
> to, claim all economists disagree with, and proceed to list some data and
> some anecdotal evidence that you say disproves "my theory"?

That wasteful government spending is the source of inflation.  If this were
true, then the inflation curve would track the government spending curb.

That there is no data supporting monetary policy has an effect on the
economy.

That monetary policy of lowering interest rates to banks is one and the same
as the federal government running a deficit.  The money the Fed lends to
banks expands the money in the economy, but it does not count as an asset
that governments can spend.

If you make a flat statement, I tend to believe that's what you believe.

Dan M. 

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Re: Free Market

[John Williams]

Dan M <[EMAIL PROTECTED]>


> That wasteful government spending is the source of inflation.  If this were
> true, then the inflation curve would track the government spending curb.

Which it does, at least better than it tracks money supply. If you look at the
time series for inflation, money supply, and government spending since 
1970, inflation tracks spending more closely than money supply. You will
need to take an average to remove some noise (I suggest 5 year average),
but the difference is obvious if you graph it. I'm amazed you haven't done 
this already. It even holds for countries other than the US.

> That there is no data supporting monetary policy has an effect on the
> economy.

I did not make this statement. In fact, I said that during banking panics that
the Fed can play an important role (by increasing the money supply to 
meet the sudden demand for money).

> That monetary policy of lowering interest rates to banks is one and the same
> as the federal government running a deficit. 
> The money the Fed lends to
> banks expands the money in the economy, but it does not count as an asset
> that governments can spend.

As far as I can tell, your much vaunted physicist-method of statistical
proof is to eyeball some tabular data, give a few poorly understood
anecdotes, and then claim that all the economists and your brother-in-law
agree, so your statement must be correct. QED.

Evidently you are not familiar with economists such as Thomas Sargent
or John Muth. You might want to look them up (or marry one of their sisters).

As long as you are talking about magnitudes of causes, surely
you can tell us which measure of monetary base the Fed is able
to directly control? No doubt you know the size of total bank reserves,
over which the Fed controls the interest rate? How does that compare
to GDP? And I'm sure you can state a mechanism as to
how bank reserves (you know, of course, that the reserve requirements
apply only to checking deposits, not money market accounts, savings
accounts or CD's) control the amount of bank lending? Then show
us how total outstanding credit and loans have been a constant multiple 
of bank reserves? Or even that bank reserves and loans have been
going in the same direction? Have you looked at the autocorrelation of
the FF rate with T-bill yields? Which one leads the other? Do you think
the Fed is setting T-bill yields, or simply following T-bill yields as 
set by the market? No doubt you can show us how the FF rate is
more influential than corporate bonds, mortgage rates, and long-term
bond rates on the economy? (or that the FF rate controls those
other rates)

No doubt you are aware that money and government bonds are easily
interchangeable. Interchanging them, in fact, is how the Fed modulates
the money supply. Cutting interest rates means that the Fed replaces
treasury bonds with currency ("federal reserve note") and bank reserves.
The Fed controls the mix, but not the total amount of government liabilities.
It is when the total amount of government liabilities grows faster than 
productivity that inflation becomes a big problem. You like to talk about 
large causes. This is rather obvious: if fiscal policy creates more 
government liabilities (money supply + treasury bonds)  than the economy 
can handle, the price of those liabilities will fall, interest rates will rise, 
and
inflation will occur. The Fed cannot control total government liabilities, that
is the job of Congress. Luckily, foreigners have been snapping up 
US Treasuries like mad this decade, so inflation has been tame. If that
changes soon, though, look out above! (That is one reason why many
economists thought FNM and FRE had to be bailed out, since a lot of
their debt was held by foreigners, and we don't want to piss off our
creditors)


  

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Re: Meltdown

[John Williams]

 Julia Thompson <[EMAIL PROTECTED]>


> The general SEC requirement had been to limit it to 12X.  An exception was 
> made in 2004 for 5 companies - Goldman, Merrill, Lehman, Bear Stearns, and 
> Morgan Stanley.
> 
> And, since I know someone is going to yell, "Cite!", I will:
> 
> http://bigpicture.typepad.com/comments/2008/09/regulatory-exem.html

Nice link. Just to be clear, I want to point out that the reserve requirements
Dan mentioned are set by the Fed, which controls deposit-funded bank 
requirements.

The big investment banks ("broker-dealers") were not regulated by the Fed, 
but rather by the SEC, as you mention above.

Two completely different regulatory environments.


  

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