24 April 2008


Dysfunction of the corporate bankruptcy system in the US is, I feel certain, a good part of what ails us inboth micro and macro terms.

In a recent reveiw of Alan Greenspan's memoir, which I contributed to The Federal Lawyer, I said that debtor/creditor relations are a central theme in US history. That was the issue behind the fights over the first and second national banks. Regional disputes over debt and credit helped ignite a civil war, and the subsequent west-versus-east character of American populism. This was the issue behind the Bretton Woods negotiations of 1944, the subsequent unravelling of the system created there, and Greenspan's own present notoriety.

I didn't reference bankruptcy law in that review, but it is a branch on the same conceptual tree.

The kerfuffle over Bear Stearns last month renewed my interest in the whole subject. I suspect that the reason Bear melted down as quickly and unexpectedly as it did has a lot to do with contemporary bankruptcy laws, and the fact that Bear's counter-parties had to act in anticipation of the very possibility, even the mere rumor, that Bear might make such a filing.

I discussed related points in a blog entry here last August, and for today I'll just link you to that.

On a personal note: I'm going to be doing some travelling. You probably won't see another entry here for a week. I hope to see lots of comments when I return.

20 April 2008

Marie and Pierre Curie

Today, April 20, is the anniversary of the day, in 1902, when the Curies successfully isolated radium salts from pitchblend. Contemporary subatomic physics may as appropriately be dated from that accomplishment as from any other.

Pitchblend,which as the name suggests is a black pitchy substance, had already been an item of scientific inquiry for some time before the Curies started work on it.

The German chemist Martin Klaproth isolated uranium from pitchblend in 1789. Why (in an era before the development of the whole idea of radioactivity) was uranium interesting? Because it was an element, and identifying the elements was the crucial task of the "Lavoisierian school" at the time -- it was that task that made what they were doing real chemistry rather than old disreputable alchemy.

The search for elements intensified after the 1860s, when the Russian chemist Mendeleev published the first version of the "periodic table." The table had holes in it, and it stood to reason that there should be undiscovered elements out there, which would enable its completion.

That is the task the Curies set themselves in the 1890s. Isolate elements. They went about it through the re-investigation of pitchblend, to see what Klaproth might have missed. The first element they discovered in this way, in 1898, is now known as Polonium, in honor of Marie nee Sklodowska's native country.

So on April 20, 1902, radium salts came out of the same blend. And the Nobel Prize in Physics, 1903 (as well as the Nobel Prize in Chemistry in 1911) in turn came out of that. The Physics award for the investigation of the new element's radioactive properties, the chemistry award (which was given to Marie alone, since these awards are never given posthumously) for the isolation of the element as such.

Pierre died in 1906, after being hit by a horse-drawn carriage while walking the streets of Paris in a snowstorm.

Marie labored on after his death, and became if you will the matriarch for the emerging field of science, until her death (almost certainly of radiation poisoning) in the 1930s.

She remains the only Nobel Prize recipient even to be honored in two distinct fields.

19 April 2008

Iraq in 1958

Someone sent me a link, not long ago, to an article that first appeared in The Atlantic in 1958 about turmoil in Iraq.

Here is the link.

Apparently the article is circulating through the blogosphere these days in a spirit of "the more things change, the more they stay the same."

But that wasn't the lesson I drew from it. The lesson I drew was that I'm rather humbled by the extent of my ignorance of recent Iraqi history. And, yes, I call 1958 "recent" because, after all, history in Iraq goes back to Hammurabi.

Anyway, in 1958, William Polk wrote: "The keystone of the Iraqi arch of power was Nuri as-Said. Observers had long realized that if he should be removed, the whole structure would crumble. Nuri ranked as one of the more able politicians in the Middle East, and perhaps his last great compliment came from the rebel leaders when they announced to their followers that the revolt would fail if Nuri were allowed to escape. But a man who is bitterly hated by a large proportion of his people is always in danger of assassination. Nuri was more than seventy years of age, in bad health, and would probably have been forced to retire soon. In case of his retirement, which Washington should have foreseen, upon whom or what were we planning to rely?"

Until I received this link, I don't believe I had ever encountered the name Nuri as-Said.

Now that I have, it is of course easy enough to look it up in wikipedia, or in some more traditional sort of reference work. What Polk there called "the revolt" was it appears more of a military coup. But the coup was made possible, in fact it was made easy, by the popular discontent with the monarchy that Nuri was serving as prime minister -- discontent that swelled as it repeatedly lashed itself to the mast of British policy in the area.

Two years before the 1958 Iraq crisis, in Egypt, Nasser (with some help from Eisenhower) had forced the Brits and French to back down and accede to the nationalization of the Suez canal. As a result, the Brits were seen as vulnerable by the "Arab street," and Nuri was in the untenable position of acting as the local representative of an imperialism in retreat.

I really should give myself a primer on such points, to try to get a broad overview of the history of Iraq from, say, 1945 to the present.

But, hey ... I'm an American, filled with the traditional presumption of my people that it is our God-given right to ignore the rest of the globe, while demanding that it attend to our whims.

18 April 2008

Wikipedian Puppets

More on wikipedia and and on yours truly.

One regular source of dispute on the wikipedia talk pages is the urgent question, "who is a sock puppet of whom?"

When editors (anyone with an internet connection and an interest in a question under discussion is an 'editor') dispute issues on the Talk pages, it frequently happens that one will try to gang up on the others by pretending to be two or more different people. When Joe says, "we should change the opening sentence of this article," but Moe replies, "No, we should leave that sentence as it is," then Joe creates Larry who says, "Joe is right, the sentence needs more work."

Ideally, that fools Moe into thinking, "gee, if Joe and this other fellow agree, maybe I'm wrong."

That's the simple version, there are endless variants. But in the case I've posited, Larry is a "sock puppet" of Joe.

The accusation "Joe uses sock puppetry" can be a devastating one, and the Joes of wikipedia resist, causing endless brouhahas.

In one endless, or just endless-seeming, debate over alleged socks, somebody wrote that two or more regular posters frequently use the otherwise uncommon phrase "putting lipstick on a pig," which sounds so idiosyncratic that they just must be the same person in reality.

Wiser heads prevailed on that proposed test, though. "Yes, the sampling problem will exist for any sort of style analysis. For example ... the expression 'lipstick on a pig' is not all that uncommon, and it would be hard (maybe impossible) to determine what percentage of editors at large use that expression."

Indeed. It was to prove this point that one of the warring editors cited the work of one Christopher Faille, specifically a book review I wrote in July 2006.

The review was of a book written by finance journalist Gary Weiss, called WALL STREET VERSUS AMERICA. My review, as it happens, was titled Lipstick Brands Change, the Pig's the Same.

As it happens, Gary Weiss himself (the biographical wiki article about him, as well as references to him in various other articles on matters discussed in that book) is the center of much wikipedia controversy. Controversies over what the articles should say quickly become controversies over who is using socks and who is falsely accusing who else of using socks. So the fact that my review was a review of that particular book seems to have made it especially valuable in spreading recognition that "pig/lipstick" is a fairly common trope among those of us who follow and write about financial matters. Putting the idea that sharing this trope makes one editor the puppet of another ... back in the sty where it belongs.

I'm glad to help. Cash will be accepted in lieu of more symbolic expressions of gratitude.

Those of you to whom this is all Greek -- you're missing nothing. Those who think I'm making it all up in the desperate need to create a bogus entry for my blog, your suspicions are easily put to rest.

17 April 2008

Old-School Philosophizing

There is an important opposition in metaphysics between "idealism" one the one hand and "realism" on the other. Also sometimes known as "monism" versus "dualism," for a reason that will soon become obvious.

The best quick way to state this is: an idealist thinks this keyboard I'm looking at right now is identical to my idea of the keyboard. The realist on the other hand, thinks the keyboard itself is a material fact outside of my skull, my idea of it is another sort of fact inside of my skull, so the two can't be the same thing.

Think of dreams to get a fix on the difference. If I'm dreaming right now, then it is fairly plausible to say that this keyboard is my idea of it -- since outside of my skull there will be a pillow and some blankets but probably no keyboard. Although idealists don't precisely believe that all of life is a dream, it is certainly more dream-like in their telling than it is in the telling of most realists.

Now, the realist/idealist dichotomy is one dispute. It's a matter of metaphysics. The rationalist/empiricist dichotomy is another thing. Its a matter of epistemology -- the philosopical study of knowledge, its components and conditions.

The history of philosophy has rationalist realists (like Leibniz). It also has rationalist idealists (like Josiah Royce). It has empiricist idealists (like George Berkeley). And it also has some fillers for the one remaining square in this grid, the empiricist realists (John Locke).

What about Immanuel Kant? His notorious example requires that we expand our grid a bit, because the best quick statement we can make about him is that he was clearly on the rationalist side of the epistemological split, but that he position was ambiguous on the metaphysical split.

He was a rationalist whose rationalism led him to a view of metaphysics that was in part realist and in part idealism.

Most of what we know about life is a dream, though we can also reasonably postulate what we can not prove -- a non-dream element.

13 April 2008

Weaver not the McCain Campaign Leaker

The New York Times, in February, published a very sloppy front page story on John McCain, and his relationship with a female telecommunications-industry lobbyist, Vicki Iseman.

It seemed for a time as if the story was going to be about adultery, but then (insofar as it developed any substance at all) the story turned out to be more about campaign fund raising and the conflicts-of-interest it may create for a candidate's discharge of his public responsibilities. The apparent adulter angle was only, excuse the expression, a tease.

I said as much here soon after the story's appearance. Why am I bringing it up again? Because The New Republic addresses a loose string left hanging back then.

TNR has run its own story about the internal dynamics of the McCain campaign, by Jason Zengerle, and he appears to have done a much better job than the Times' team did. Zengerle's point is that there are bitter enmities within the McCain campaign, personal rivalries that McCain does nothing to seek to control, and that accordingly spin wildly, dysfunctionally. That someone in this climate leaked quasi-salacious tidbits about Ms Iseman to The Times becomes quite believable.

But that someone wasn't, it appears, John Weaver. Weaver had been the chief strategist of the campaign until shortly before the story appeared, when he had lost a power struggle with Rick Davis. So he became a plausible suspect.

Zengerle convincingly clears him.

So what? In the big scheme of things, so ... nothing. Yet both God and the devil are in the details, and it seems to be that whoever did start the Times down the road of its adultery-maybe-now-campaign-finance story sits at some sort of intersection of microhistorical fault lines.

12 April 2008

Whatever Happened to Solengo?

Solengo Capital, a hedge fund, was the center of a burst of business for copyright lawyers a year ago.

Now, I understand, the fund breaths no more. Its assets have been purchased by another operation, and its founder given the could-mean-anything but really-means-nothing title of "consultant."

Even the most faithful of my readers may need a refresher course, and a couple of links like this one.

The gist: Brian Hunter was the trading not-quite-master mind who put dynamite beneath the floor boards at a futures-oriented hedge fund named Amaranth in 2006. He lost $6 billion of other people's money.

So, with that good old Canadian spirit, he got right back on his horse and created Calgary based Solengo the following year.

Solengo started sending out its marketing brochure as an unsecured Adobe Acrobat document through cyberspace. I can't say how widely, but widely enough so that a couple of alert bloggers got it and posted it. That's when the copyright lawyers got involved, determined to ensure that only those Hunter selected for viewing his brochure, should be allowed to view it.

Given the nature of the internet, the effort was doomed to failure in fact, even despite some successes in court. Anybody with any curiosity in the matter has long since had the brochure on their hard drives.

Flash forward. A Bloomberg story yesterday informs us that Mr. Hunter is now a consultant for a Boston-based operation called Peak Ridge Capital.

Peak Ridge got its start in November, and it appears to have had a good first five months. Judging from the story by Saijel Kishan, the real powers-that-be at Peak Ridge want it to be known that Brian doesn't trade for them, nor does he run the risk management office. He consults. He "devises trading models and strategies," which presumably the actual traders are then free to ignore.

Peak Ridge has "bought the assets" of Solengo, we learn in paragraph five. What did that amount to, I wonder? A desk, a rolodex, and some rolaids?

Another tidbit from the story I have to mention: Kishan refers to Solengo as a "hedge fund firm that Hunter tried to start...." His sources are acknowledging, then, that Solengo never really got underway.

Maybe because they were too busy in fruitless litigation over a brochure, and wasted their trading kitty on legal fees?

So that's what happened to Solengo.

11 April 2008


In the philosophy section of Yahoo! Answers yesterday I encountered the following question: "Why shouldan't I kill myself? why?why?why?why?why?why?why?wwhy?hy?why?"

It seemed odd that somebody distressed and contemplating suicide should come to Yahoo! Answers with this. Yet it also seems hard to believe that anyone looking at the issue of suicide, and wanting to engage a discussion in a calm philosophic way (which would make sense of the choice of forum) would do so quite so earnestly and typo-idiosyncratically as that.

Acting on the possibility that this was a genuine case of distress, I gave the best answer I could come up with. And I found to my surprise that it didn't sound like a Jamesian answer. More like a Schopenhauerian answer.

Maybe James' discussion of the point was a bit too meta-philosophical, and the note I struck here was more first-order.

Anyway, I'll see later today whether the fellow responds. I already clicked through the screen name and no e-mails or i-ms via the Y!A system are allowed. So I guess we can just hope for the best.

10 April 2008

Gossip of Laundry

Last week I watched a movie titled "Chisme de Lavaderos."

The title is a Spanish phrase that literally translates as "laundry gossip."

It was a strange, low-budget movie, with a couple of formulaic endings that cancelled each other's effect.

The bulk of the movie had the structure of a Whodunnit. There was a homicide victim, and plenty of people in the neighborhood with a reason for despising him, due to his low-rent lothario ways.

We see a rather slip-shod police department investigating the matter -- and this produces the airing of dirty laundry that presumably inspired the title.

There's also a subplot about how the victim will be buried, at whose expense and with what sort of casket.

These are perfectly fine materials for a story, of course, but the twin endings bug me. Since I doubt I'm spoiling a movie that any of my readers will be likely to see for themselves anytime soon, I'll tell you about them.

The first ending indicates that the bulk of the movie was the apparent victim's nightmare. This is a classic story structure, and presumably, as with the nocturnal visions of Ebenezer Scrooge, this nightmare should lead to the reformation of a sinner.

On the other hand, the producers of this movie didn't want to leave it at that, so they tacked on to that a "here we go again" ending -- as if Scrooge, having had his visions, reformed and given the Cratchit family a huge Christmas feast, had returned to his home to find Marley there waiting for him again, still ticked off.

That doesn't make a lot of sense? My point exactly.

06 April 2008

Not like Waco

A police raid on a religious/polygamist community in Texas yesterday seems to have come off without killing anybody.

But it did send me down memory lane, to the infamous attack on the Branch Davidian compound on February 28, 1993 resulted in 76 deaths. Twenty-one of the deceased were children.

I wrote "compound" in the above sentence because the term has become customary, and I'll leave it in. But I note that I might as easily have written the "Branch Davidian property" or the "Branch Davidian community." When is such an area a "compound"? Is the term generally used to demonize those who live there, thus assisting those who wish to justify their violence directed as "compounds"?

It's my understanding that the term "compound" in the sense of several buildings clustered together originated in the Far East in colonial days, when the westerners would live in groups -- the better to enable them to put up a co-ordinated defense in the case of hosility by the locals. Since David Koresh's followers may have thought of themselves as in an analogous situation, perhaps the word is fair.

Or perhaps not. Did the Davidians ever refer to their home as a compound, or was it a term foisted upon them on others? Somebody should put Nexis to use to straighten this out.

The story to which I linked you above, by the way, refers to the property occupied by the religious sect in question as a "ranch" for the most part. I see one use of "compound" in the fifth graf.

Why do I make such semantic points? After all, didn't Juliet say that a rose by any other name would smell as sweet?

Yes, she did. But her story didn't end happily. Because names, like Capulet or Montague, can't be so easily set aside as youthful naivete may hope.

05 April 2008

Three Questions for Senator Clinton

I'm on the list for press releases from the two remaining Presidential candidates in the Democratic Party.

Why am I not on Senator McCain's list, too? Because my presence on any of these lists dates back to last October, when Congress was debating the issue of the taxation of "carried interest" on private equity funds. This is a matter of grave concern for my usual audience, so I contacted the Democratic candidates about it.

There was no "carried interest" story on the Republican side, I assure you.

Anyway: I am on the lists, and on Friday I received an e-mail statement from Hillary Clinton's press office on the new unemployment numbers.

The statement was by-the-book, but I decided: what the hack? why don't I write back. I don't really expect an answer, but I'll share with you the questions:

I'm curious about the matters below that concern: Clinton campaign economic/financial policy. I'd love to have an on-the-record quote from the candidate about these matters.

1. Glass-Steagal. Does Senator Clinton believe, as Senator Obama suggested recently, that the repeal of the Glass-Steagal distinctions between investment and commercial banks was part of the road to our present troubles? If so, did she use her influence within the administration of President Clinton to raise warning flags at the time, or has the problem only subsequently become clear?

2. Yesterday morning, one of the Banking Committee Senators asked Mr. Bernanke: How big does an institution have to be to be 'too big to fail'? I'd appreciate the Senator's views on that. If no institution is too big to fail, then sometimes the right thing for a President to do (invoking the imagery of a certain television ad) would be to let the phone ring, wouldn't it? Why should the CEO of Bear Stearns, or someone in a similar position, expect to be able to reach anybody in the White House at 3 AM?

3. A more minor point, involving personnel issues, but one in which I think our readership will be interested: Would Robert Rubin likely play an important part in the economic/financial policy of a new Clinton administration?

I'd very much appreciate it if you could get back to me on these points. Thanks.

04 April 2008


There's a fascinating blog entry about the history of lexicography here.

I'll skip to one neat paragraph, which that blogger is quoting from a professor at Rutgers:

Johnson's Dictionary contains many of these hard words, and for word lovers they can be delightful. There you'll find nidification, meaning "the act of building nests," and gemelliparous, "bearing twins." Scrabble players will delight in words like ophiophagous ("Serpent-eating"), galericulate ("Covered as with a hat"), or decacuminated ("Having the top cut off"). But Johnson was not entirely comfortable with them: "I am not always certain," he said, "that they are read in any book but the works of lexicographers" (preface, pp. 87-88). He was right. Consider the word naulage, which appears in nearly a hundred books in the eighteenth century alone. The problem is that every one of those books is a dictionary. They all tell us that naulage means the fee paid to carry freight by sea, but there's no indication the word was ever used even by those paid to carry freight by sea.

Most of those words would simply annoy a scrabble player, since you never have enough tiles to spell galericulate anyway.

Still, they are fun. Assuming that "naulage" was never used, how did it get invented? Johnson was implying that the authors of such reference works were copying from each other. And in the case of "maulage" the word would sound plausible anyway, so would be copied without much compunction. Haulage + nautical = naulage!

Perhaps the first author to use it intended it as a trap. He might have figured if somebody copied it, he'd have proof that person had stolen from him. That trap worked wildly well, then, with nearly a hundred steals!

Anyway, as I word lover myself I'm going to be on the lookout for opportunities to use "naulage."

03 April 2008

Bill Mauldin

A toast to Bill Mauldin, the cartoonist remembered for the creation of Willie and Joe, the famously unkept and slouching GIs that Mauldin invented when he was serving as an infantry sargeant in Italy in 1943.

Mauldin died more than five years ago, and there's no particular reason I should think of him just now but, hey, it's my blog. "I don't need no stinkin' reasons."

Actually, I've just been leafing through a recent biography of Mauldin, by Todd DePastino, which tells me that Willie & Joe made their first appearances in the 45th Division News, and only by stages became world-famous.

One of the many reproductions in the book shows our protagonists trudging through the mud and cold rain of the Italian winter, when an officer (who of course, is dry in his vehicle) sticks his head out thereof to ask Joe, "Have your men tried Dubbin, Sargeant?"

[As anyone likely to have been reading the 45th Division News would have known, Dubbin was a water resistent boot wax.]

DePastino helpfully tells us that nearly 70% of all non-battle injuries in Italy involved trench foot. There are two possibilities here, either encompassed in the weariness of the faces of the two men travelling on foot. It is possible that the officer is so ignorant of his men and the life they're leading that he thinks his suggestion is helpful. Or it's possible he's just being an arrogant son-of-beatch and the question is a form of sneer.

Through Willie and Joe, and through his own talent of course, Mauldin got to speak a little truth to power. We should all be so lucky.

Knowledge is warranted belief -- it is the body of belief that we build up because, while living in this world, we've developed good reasons for believing it. What we know, then, is what works -- and it is, necessarily, what has worked for us, each of us individually, as a first approximation. For my other blog, on the struggles for control in the corporate suites, see www.proxypartisans.blogspot.com.