31 December 2009

Top Financial Stories 2009

I generally ask myself at this time of year what were the biggest stories of the past twelve months, in business/financial news.

By "stories," I don't mean themes, such as "Doubts about efficacy of SEC regulation" or "US/EU relations." I mean stories, such as one might have seen in a particular newspaper on some specific day. Of course, I choose the ones I do largely because they illustrate an important theme. But the theme itself isn't the story.

Further, I don't rank them, as in a top ten list. For the first couple of years that I did this I simply gave one "top" story from each of the twelve months of the year now ending. Last year was so wild, especially in its second half that I couldn't stick to the one-a-month presentation. I ended up with a list of 18 big stories, two per month starting with July.

This year, for the sake of balance I suppose, I have produced another list of 18 stories, twice a month this time for the first six months, then just one a month from July.

All that understood: Here we go! The list is dominated this year by a meta-theme. We might call it: the triumph of experience over hope.

January. (a) The inauguration of a new President of the United States, and Barack Obama's choice of Timothy Geithner to head Treasury. Geithner's presence in the new administration is not a sign of change, but one of continuity. During most of the Bush years, Geithner was the very visible President of the Federal Reserve Bank of New York.

(b) Financial crisis in Iceland brings street protests, shake-up in government there. Iceland, on the one hand, has long been a free market economy, with taxes lower than those of most other OECD countries. On the other hand, it has maintained a Nordic welfare system, including universal health care and post-secondary education. Whatever may be true of Las Vegas: what happens in Iceland, is widely watched elsewhere.

February. (a) Obama signs the stimulus act, a/k/a the American Recovery and Reinvestment Act (ARRA). The full title seems better to convey the almost cartoonish Keynesianism involved: "An act making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization, for the fiscal year ending September 30, 2009, and for other purposes."

(b) Zimbabwe asks African states for $2 billion in aid -- Mugabe vows to continue brilliant policies. I'll simply offer a link here.

March. (a) Bernie Madoff pleads guilty without a plea deal, claims to have acted alone. Of course, he did not act alone, but by taking the fall and keeping mum on confederates, he appears to have earned some necessary prison cred.

(b) UK Financial Services Authority adopts new rules on derivatives. In London as in Washington, complicated and insufficiently regulated derivatives are widely blamed for the crisis of 2008. That diagnosis is jejune, but is to be expected. The particular derivatives that draw fire in the UK are known as "contracts for difference."

April. (a) Dow Chemical finally closes on its Rohm & Haas deal. The idea of this merger was to craete a "leading specialty chemicals and advanced materials company." Its logic would have been more powerful, and the deal would have gone through smoothly, had the timing been a bit better.

(b) Chrysler files for bankruptcy This is the first of three headline events on our list of 18 that may stand in for a single momentous theme -- the frog-marched restructuring of the US automotive industry in general. And we won't bother listing separately that GM too passed through a bankruptcy court proceeding.

May. (a) China-Brazil oil/loan deal The Brazilian oil company Petrobras finalized a deal with the People's Republic of China. Petrobras got a (US)$10 billion loan and PRC got a long-term supply of 'black gold.' This is a straw in a lot of different winds -- the rise of China to global prominence on the back of its huge dollar reserves is one of them.

(b) Obama announces new CAFE/ emissions standards. This is our second auto industry headline of the year. The program is projected to reduce oil consumption over the period from the 2012 to the 2016 model years by approximately 1.8 billion barrels. (As you probably would expect, dear reader, I think such projections warrant skepticism.)

June. (a)US Supreme Court decides Traveler's Indemnity v. Bailey. Asbestos is one of the big "mass tort" issues that have rocked our civil legal system in recent decades. Travelers thought it had a deal that limited its exposure via a settlement trust established by order of the federal district court in Manhattan back in 1986. Unfortunately for them, state law claims and "collateral attacks" made that trickier than they had expected.

(b) Elections to Euro parliament strengthen the center-right parties. For purposes of the italicized statement, anyway, we may understand the term "right" to mean the group of parties or factions that are suspicious about the role of the Parliament they are joining, either on behalf of separate sovereign nationalisms or on behalf of EU-regulated global commercial concerns or both. The "left," which lost this round, consists of those that see a need for a more activist EU.

From here on we are presenting just one headline per month.

July. Cash-for-clunkers program in the US. This is our final US-auto-industry headline. There was always an ambiguity to the plan. Was it designed chiefly to stimulate the auto industry, or to improve fuel efficiency? The goals aren't obviously in harmony. Still, any critique of its efficacy in one respect could be deflected by pointing to the other.

August. Settlement of US/Swiss Dispute over UBS Confidential Client Information. The relationship between Switzerland and the US seems to have grown closer in a number of respects over the last year.

September. Target Corp. declassifies its board Reform has come to the field of corporate governance, though what over-all impact such reforms may end up having it is hard to say.

October. Ireland votes in favor of Lisbon Treaty, effectively secures the new continent-wide government It is difficult to tell where Europe is headed. The Lisbon Treaty would certainly seem to be a step toward closer political integration. But the European Parliamentary elections, as noted above, were won by parties skeptical thereof, and there are a lot of centrifugal forces at work.

November. What is patentable? SCOTUS hears arguments. My own expectation is as follows: (a) the Justices will uphold the court below in its finding that Bilski's 'process' is really an abstract idea and thus not patentable; and (b) they will work harder than the court did below in order to define what is or isn't an abstract idea.

December. Two crucial bills advance through the Houses of the US Congress -- the health care reforms and the financial-regulatory system overhaul.
It seems very likely that something will be enacted into law in both of these areas sometime early next year. But I could be wrong even about that.

27 December 2009

My three calenders

For my week-by-week desk calender through 2010, I will be relying on a beauty with a Stephen King theme. Among its attractions, there is a #3D cover image of a lengthy passage between two lines of hedges. Wholesome enough: unless you tilt the calender a bit, at which point you can see a bloody croquet mallet on the ground at the front of the path. Inside, you can find such tidbits as this: Feb. 9, 1985, was the day the Bangor (Maine) Daily News printed a story revealing that King was the real author behind the pseudonym "Richard Bachman."

My month-by-month wall calender for the coming year, from "Silver Lining," has a World War II history theme. You have to love Silver Lining, if only for their boast that they have "the best selection of calenders in the known universe". On the page for January, we learn for example that it was on January 2, 1940, that Red Army forces launched a major offensive against Finnish positions on the Karelian Isthmus.

Finally, for the day-by-day calender on top of my dresser, I will this coming year be relying on: "Latin: 365 Phrases with Phonetics and English Translations" to get me through MMX.

I thought you'd want to know. You're welcome.

26 December 2009

Links about health care reform

The subject of the day. I don't have a lot to say about it, so I'll simply offer links.

1. What I said 2 and a half years ago still reads well to my own biased eyes.

2. Here is something along analogous lines, that Ronald Bailey wrote back in 2003.

3. But let's be more up-to-date for a moment. Here is something from the folks at Cato, who are watching all this with some more particularity than I am.

4. Julian Sanchez reminds us that insurance is about managing risks. If health insurers aren't allowed to manage risks (by for example protecting themselves against liability for pre-existing conditions) then whatever exactly it is that they are doing, it is no longer insurance as that term has always been understood.

5. It does seem to be an odd but empirically observable fact that in some fields low-risk people purchase more insurance than do high-risk people.

6. Virginia Postrel tells us about her life, her breast cancer diagnosis of 2007, and what she makes of it in terms of health insurance as an industry.

7. On the intra-party split the Democrats now face? This may be important. The bill is hardly home-free given the huge differences betwen the two sausages that have come out of the two chambers of our sausage making apparatus. Here is a columnist in The New York Times on the intra-party split.

8. And here is ABC News.

9. Forty-five years ago, Kenneth Arrow wrote a "seminal paper" about the economics of health care. Krugman cites it as gospel, others aren't so worshipful.

25 December 2009

From John Milton's Nativity Ode

Time will run back, and fetch the age of gold,
And spekl'd vanity
Will sicken soon and die,
And leprous sin will melt from earthly mould,
And Hell itself will pass away,
And leave her dolorous mansions to the peering day.

Yea Truth, and Justice then
Will down return to men,
Th'enamelled Arras of the Rainbow wearing,
And Mercy set between,
Thron'd in celestial sheen,
With radiant feet the tissued clouds down steering,
And Heav'n as at some festival,
Will open wide the Gates of her high Palace Hall.

[lines 135-148].

I love these lines, and post them here each year due to the vividness with which they display hope, the most forward-looking of the virtues.

Merry Christmas

24 December 2009

Longfellow, on the Bells of Christmas Day

I heard the bells on Christmas day
Their old familiar carols play,
And wild and sweet the words repeat
Of peace on earth, good will to men.

And thought how, as the day had come,
The belfries of all Christendom
Had rolled along the unbroken song
Of peace on earth, good will to men.

Till ringing, singing on its way
The world revolved from night to day,
A voice, a chime, a chant sublime
Of peace on earth, good will to men.

And in despair I bowed my head
“There is no peace on earth,” I said,
“For hate is strong and mocks the song
Of peace on earth, good will to men.”

Then pealed the bells more loud and deep:
“God is not dead, nor doth He sleep;
The wrong shall fail, the right prevail
With peace on earth, good will to men.”

20 December 2009

Dead-Tree Books

I had hoped to write something about animal language again here, and about how a certain philosophical way of thinking about animal language can help us negotiate our way, in the contemplation of our own verbal behavior, between the upper dogmatism of a Chomskyan rationalism and the lower dogmatism of a Skinnerian positivism. But anything worthwhile along those lines would take more time and effort than I'm prepared to put into it right now, so I'll beg off with a simple observation about the (not entirely unrelated) question of the publication of books.

How long will the dead-tree book publishing industry last, in the face of Amazon's Kindle and other forms of digital competition?

For a sober discussion of the issue go here. But for a more amusing take, I prefer blogger Jeff Matthews.

His point? Try to think of it as if it were a new idea and consider how insane it would sound. If everyone was using digital screens to read, and accustomed to it, then the idea of creating tree farms (or deforesting continents so we need to rely on tree farms) so that we can produce pulp with expensive machinery so that we can spray ink onto tiny slices of pulp known as "paper" so that we can then market ideas and stories years after they were first conceived, hoping that they have remained topical in the interim ... all this would seem insane.

Yet it doesn't seem insane, because human beings are creatures of habit. We love our dead-tree books like some of us love our old vinyl records, and the transition to the newer ways of reading will take some time.

Ah, and that new book smell. Like the new-car smell, it has its addicts. And the flying buttresses of Gothic architecture offer a ready example of how an arrangement at first adopted for reasons of utility can come to seem valuable in itself, to be beautiful, even when there are other ways of keeping the walls up.

19 December 2009

2010: A Year of Living Dangerously

The Federal Open Market Committee, a body of the Federal Reserve, voted this week to keep the federal funds rate in the range betwen 0% and 0.25%.

Frankly, I believe this to be irresponsible. It is part of the bad old tradition of using the money supply to stimulate an economy by cheapening the currency. They also retained the "extended period" language. You can see the whole statement by clicking that link.

The first two sentences of the 3d graph are crucial: "The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve is in the process of purchasing $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt."

This means full speed ahead for a policy of "quantitative easing," or the cheapening of the US dollar, and this in turn means increasing prices across the board are inevitable.

In the very short term, this is good news for some people. It is good news for businesses that have gone too far into debt, but whose debt is measured in nominal (non-inflation-adjusted) terms, because they'll be paying back that debt now in cheapened dollars, so in effect their debt is being reduced. It is good news, too, for some of hte unemployed. Some of those businesses, relieved of that debt, will be in a position to hire new employees. In simple terms, then, this policy will have and is having a stimulative effect, but it is like getting one's energy from a drug. The drug has effects on the body that go far deeper than the immediate rush, and even the rush won't be as great as some hope, because a body builds up tolerance over time, requiring ever-greater doses for the same effect.

Neal Lipschutz, managing editor of Dow Jones Newswires, expressed his disappointment immediately. "I continued to hope for the merest hint that zero rates can't go on forever. That would have been achieved by altering or eliminating the 'extended period' modifier for how long current policy would hold. But it stood unmolested."
Though Lipschutz didn't put it this bluntly, it does now appear that we are headed for 1970s-style stagflation.

The price of crude oil (which is globally set in terms of the US dollar) has been declining for the last month, from $80 to $70. Yet it began a climb immediately when markets learned that the FOMC was sticking with the near-zero rates and with the "extended period" description of their tenure.

18 December 2009

Scheduling

This entry was pre-packaged. Tomorrow's will be as well. By Sunday I might be writing my blogs in something like real time again, although I have a pre-packaged one lined up, just in case.

On Saturday, I'll be on Broadway, watching a performance of Finian's Rainbow.

I understand that there will be a cast album available in February.

The fascinating thing about this play, for me, is that the lyrics to its songs were written by none other than Yip Harburg, who is best-known as the lyricist for all the songs in The Wizard of Oz (1939). Any man who could write lines like "I'd unravel any riddle for any individle" has a streak of genius in him.

Finian's Rainbow was first on Broadway in 1947, smack in the middle of what we see in hindsight as its golden age, and its songs include "How Are Things in Glocca Morra?," "Old Devil Moon" and "Fiddle Faddle."

17 December 2009

Grover Washington

Grover Washington Jr., a renowned jazz saxophonist, died on this day, twenty years ago.

If you want to know more about GW, you can listen to him on this podcast on the WGBH website, with interviewer Eric Jackson in 1994.

Why is this worth mentioning? Because I've been using a "today in music history" calender all year, and sporadically mining tidbits therefrom for blog entries. I won't have such a calender for 2010, so this will be my last entry with that source of inspiration.

13 December 2009

Stemmer Weighs in on Grammar

The story so far. Skinner advanced a theory (or a research program, or something) about how human language is simply "verbal behavior," a structure of stimulation and response subject to operant conditioning, like the movements of a rodent through a maze.

Chomsky objected, on grounds of method, vocabulary, and grammar.

In 1970, Kenneth MacCorquodale replied on Skinner's behalf, and seems to have done a better job on the issues of method and vocabulary than on the issue of grammar, which many had seen from the start as the heart of Chomsky's critique (and is certainly the heart of his own professional work as a linguist). Grammars consist of very complex structures, and in his view our ability as humans to acquire this structure can not be explained as the result of a process of generalization. For example: Children who already know the sentence "The man who is tall is in the room" easily learn that the way to turn that into a question is this: "Is the man who is tall in the room?"

If behavioralism is right, Chomsky thinks, children would at least sometimes make the mistake of asking, "Is the man who tall is in the room?" It is often the case that when turning a statement into a question, we transfer the occurrence of the word "is" to the start of the corresponding question. "The tall man is here" becomes "Is the tall man here" and so forth. Following that practice mechanically, simply generalizing it, could produce mistakes like the italicized sentence above. "Children make many mistakes in language learning," Chomsky says, but never that one.

So our story comes to 1990, when Nathan Stemmer wrote his own reply to Chomsky.

Stemmer replies that behavioralists don't have to expect children to treat the word "is" in isolation and generalize its moves in such a way. Children, rather, likely learn the active sentence pattern first "X is Y," and latter generalize it over time to learn substructures, so that "X" might include the word "is" internally.

Consider, then, "The man who is tall is in the room." The phrase "The man who is tall" is X in the old "X is Y" pattern. The second appearance of the word "is" then becomes the copula -- the one that connects X with the Y of "in the room." Generalization, then, Stemmer says, "does not simply transform certain word sequences into other word sequences but rather certain structures into other structures," and does so without importing a Chomskian machine-shop into the brain. Is [the man who is tall] in the room. Voila.

So (you might ask after all of this) what is my view? As a curious amateur, on-looker, and stand-up philosopher I have to say I think both sides are wrong. I do think that the Skinnerians are right to distrust the presumption of human uniqueness that runs through Chomsky's work. And I side with them (and the whole empirical tradition) against innate ideas, even grammatical ones. Stemmer's contention that we don't need innate ideas to understand how statements can be transformed into questions within a natural language seems to me sound. On the other hand, the Skinnerians' materialistic, reductive philosophy is repugnant on its own account.

William James used to refer to himself as squeezed between the "upper and the lower dogmatisms," between the positivists and the Hegelians of his day. It is always thus. Closer to our time, Skinner has revived the role of W.K. Clifford and Chomsky is writing like one of those "priggish Hegelians" on the top side of the two dogmatisms.

Next weekend I hope to return to these issues from another angle.

12 December 2009

Dayton Flies Past the Red Foxes.

In college football news, the Dayton Flyers defeated the Marist Red Foxes 27 to 16 on November 21, in what was the season's final game for both teams. This gave the Flyers a share of the championship of the Pioneer Football League, or PFL.

I presume that the Dayton Flyers get their name from the Wright Brothers, who lived and worked in Dayton when they weren't at their testing ground in North Carolina.

Despite the outcome of the game, though, I have to say as a Marist alum that the year has been a good one for the Red Foxes, our boys on the Hudson. They were 7-4 overall, tying a record (this is only the second time in Varsity team history they got 7 wins in a season). They finished at 5-3 within the PFL. After a sloppy start they put together a six game winning streak in midseason.

Their offensive star, wide receiver James LaMacchia, became the first player in Marist history to exceed 1,000 yards receiving in a season. He broke through the 1,000 mark in the course of that final game against the Flyers, receiving a pass for a 77 yard TD play in the third quarter.

On to bigger and better things in years to come.

11 December 2009

Sam Cooke

One of the pioneers of soul, Sam Cooke, died forty-five years ago today, on December 11, 1964.

Cooke checked in to the Hacienda Motel that evening. According to the manager of the hotel, Bertha Franklin, he checked in with a woman, who evidently left him at some point thereafter. Cooke, enraged, broke into the manager's office (with a jacket and shoes, but pantsless) and demanded to know where his companion was. Ms Franklin said the woman was not in the office. Cooke didn't believe her and allegedly attacked her. Franklin then shot him in self-defense.

His death has given rise to conspiracy theory. Etta James, in her autobiography, claimed that she observed wounds on Cooke's body, in the funeral home, that went far beyond what Franklin's account would explain. She said Cooke was beaten so badly his head was nearly separated from his shoulders, his hands were brushed and his nose was broken.

Solomon Burke, another soul pioneer, has said: "I still think there was some kind of conspiracy ... I've always felt there was some sort of conspiracy there ... I listened to the reports and I listened to the story of what happened and I can imagine Sam going after his pants. I can imaging Sam going up to the counter and saying 'Hey, somebody just took my pants.' And he's standing there, seeing the woman with his pants. I can imagine him saying "Give me my pants." But I can't imagine him attacking her. He wasn't that type of person to attack somebody. That wasn't his bag. He was a lover, OK. He wasn't a fighter. He wasn't a boxer. You never heard of Sam Cooke beating up his women."

Franklin's word is not utterly uncorroborated though. She was apparently on the telephone at the time with the Motel owner when Cooke broke in to the office, and the owner then heard much of what transpired, up to the gun shots. Her testimony at the inquest backed up Franklin's, which is likely the reason criminal charges were never brought.

The theory, as always, depends on the theorist. Cooke was killed by the mob. Or he was killed by Whitey to take a strong black man down. Or he was killed by a pimp, and the clothes-stealing hooker was part of the set up.

As to the girl (hooker or groupie or whatever) who ran out on Sam Cooke? Lisa Boyer. She had a story to tell, too, and the conspiracy theorists have had much to say about that. But I will go no further. It is easy enough to wallow in such material if you wish.

All I wish to say on this anniversary of his death, however it came about, is that surely what is best about Sam Cooke is what lives on. Click there for an an example.

10 December 2009

The Anniversary of the Madoff Fiasco

It was one year ago today, Dec. 10, 2008, that the two sons of Bernard Lawrence Madoff informed authorities that their father had just admitted to them that his asset management operation was "one big lie." He would be arrested the following day. That makes this an anniversary worthy of some reflection.

Those two sons, Mark and Andrew, worked in the trading operation, not asset management, thus they just might have been innocent of any criminal involvement themselves, though I'm sure investigations are continuing, the books are not closed on that.

This distinction between the trading and the asset management side is crucial to the Madoff saga. Madoff's trading operation, formally known as a "market maker," launched in 1960, was legitimate. It was controversial in some respects (especially among those of us who consider the practice of payment-for-order-flow inherently dubious) but it was legal. It also may have been integral to the success of his ponzi scheme, formally known as an investment advisor (IA), although not integral in the way that was so often suspected.

Madoff was often suspected of attaining the unusually consistent results of the IA operation by "front-running," i.e. by making illegal use of information he acquired as a market maker. The SEC would periodically investigate Madoff, only to find that he wasn't front running, so he must be clean! The truth of course is that he wasn't front running because he wasn't really trading through the IA wing of his company at all. It was all a sham, and those surprisingly consistent results were simply invented. So the possibility of front-runing was serving perhaps two purposes. First, as noted it was a false scent that kept the regulators busy. But, secondly, it may have helped attract investors. "Pssst, this guy is likely front-running the info from his market maker side. We should get us a piece of that action."

Or ... maybe not. But it is an intriguing idea: that the victims were in part victimized by their own desire to get on the winning side of a con game. That con game wasn't happening. So they ended up on the losing side of another one.

06 December 2009

Chomsky versus Skinner

Let's return to the subject of language. Last week we discussed Skinner's view that "bread, please" is a paradigmatic instance of "verbal behavior," learned through behavior modification, in the same way that rats learn the route through the maze that will get them to the corn.

Chomsky's famous 1959 review of the book, Verbal Behavior, is sometimes credited with at least slowing the triumphal march of behavioralism through the social sciences. [By the way, is it "behaviorism" or "behavioralism"? So far as I know, the two labels are interchangeable.] Chomsky focused not on such phrases as "bread please" but upon proper sentences, and accordingly upon grammar. He contended that natural-language sentences have a "deep structure" due to the "internal structure of the organism," -- i.e. to neurology.

As to method, Chomsky objected that Skinner used the prestige of laboratory research for conclusions that go far beyond anything they warrant. He creates "the illusion of a rigorous scientific theory with a very broad scope, although in fact the terms used in the description of real-life and of laboratory behavior may be mere homonyms, with at most a vague similarity of meaning." The word "stimulus," is he says an example. In the case of an actual loaf of bread on the table, that bread might be the stimulus to which one refers in the use of the word "bread." But a lot of proper nouns refer to people the speaker has never met, places to which he has never been, etc. A lot of people who have never been to Moscow use the word "Moscow" in sentences all the time, and use it correctly. Why? On Chomsky's view, this can happen because they are hard wired for language. They have the nerve connections they need for it. On Skinner's view (as Chomsky understands it) the proper use of "Moscow" by someone who has never been there requires a stretching of the simplistic ideas of "stimulus," a stretching perhaps to the point where "stimulus" becomes a homonym of itself.

Skinner was personally unimpressed by this critique. He never answered it formally, and in an interview he gave for the Saturday Review of Books in 1972 he sought to explain why. He said he saw a pre-publication draft, only read the first half-dozen pages, and then decided Chomsky had missed his point. Then he commented somewhat whimsically on the field, and on the rise of Chomskyism. "Linguists have always managed to make their discoveries earthshaking. In one decade everything seems to hinge on semantics, one another decade on analysis of the phoneme. In the Sixties it was grammar and syntax, and Chomsky's review began to be widely cited and reprinted and became, in fact, much better known than my book."

As I mentioned a couple of weeks ago, other behaviorists have stepped forward to defend Verbal Behavior from Chomsky's attack. One of the best-known examples of this is Kenneth MacCorquodale, who wrote a review of the famous review for the JOURNAL OF THE EXPERIMENTAL ANALYSIS OF BEHAVIOR in 1970.

You can access that here: www.ncbi.nlm.nih.gov/pmc/articles/PMC1333660/?tool=pmcentrez

MacCorquodale quotes the "mere homonyms" passage, in particular, and expresses surprise at the implicit idea that "real-life" behavior could have different basic principles from laboratory behavior. In MacCorq's eyes, Skinner set out a hypothesis, and a research program, which of course is unproven because any research program deals of necessity with the as-yet unproven.

As to "Moscow," MacCorq tells us that the stimulus-response paradigm of behaviorism does not require that we stick to just one stimulus for every one response. Skinner's book itself "repeatedly and clearly insists that a verbal response may be controlled by different stimuli on different occasions." And one occasion for the response "Moscow" may well be the presence of the city of Moscow. What do the flight attendants say when your plane touches down there?

That is a point about scientific method, and about vocabulary. MacCorq for the most part leaves Chomsky's point about the grammar of the sentences of natural language untouched. Others of his school have addressed that, though, so we will have material for continuing this series.

05 December 2009

Thoughts on Disney's birthday

Walt Disney was born on this day, December 5, in 1901.

It has become fashionable in many quarters to burnish one's intellectual or aesthetic bona fides by sneering at Disney and all his works. But I think that as time passes and we see him in perspective, we can see him as one in a line of chroniclers of the ever-shifting nature of the old folk tales.

The term "Disneyification" is often thrown about on the presumption that Disney corrupted the pure folk intention of the sometimes gruesome older tales by making them sentimental and happily-ever-afterish.

But what is sometimes called "Disneyfication," what might more neutrally just be called sentimentalization, is actually a process that set in long before 1901, and of which Disney was only one avatar. Charles Perrault published a collection of folk tales in 1695, most of them already quite old by then, under the title: "Histories or Tales of Times Past, With Morals." But Perrault's collection had a still more intriguing subtitle, by which it is better known: "Tales of my Mother Goose."

Between the 1695 French-language collection and the German-language collection of the Brothers Grimm in 1812 there is some overlap. Both collections contain a Cinderella story. Disney's version entered the motion picture theatres in 1950. The distance between the first and second of those dates is almost as great as the distance between the second and third. We can think, I submit, of sentimentalization as a process underway changing this story consistently throughout the centuries involved, and we can think properly of each of these three dates as representing a different snapshot of that process.

Don't blame the photographer.

Here is the Perrault version of Cinderella.

www.Pitt.edu/~dash/Perrault06.html

Notice just a couple of points. In Perrault's version, in the third paragraph, the protagonist's first nickname is the harsher "Cinderwench," though we're told that the youngest of her stepsisters was nicer to her than the older one, and softened that to "Cinderella." Noblesse oblige? Also, Cindy chooses to sit among the cinders, when her household duties are done. She is not forced into that corner by her wicked step-mother. Indeed, the stepmother is more "haughty" than wicked.

Another point from near the end of the story: the Prince never sees her in rags. Perrault's story is, if you will, too class conscious for that. The Prince sends servants about the countryside to test out the glass slipper on maidens, he doesn't engage in such tedious work himself, and so doesn't put himself in the position of kneeling before a servant girl in order to try to get a shoe on her foot.

By the time of the Brothers Grimm, the story has changed. I don't say that they changed it, just that the story as they knew it more than a century later was different, and they recorded that fact for us. There is no use of "Cinderwench," for example. To the Grimms, she is "Ashputtle," which translates well into "Ash-maiden." Or Cinderella. On the other hand, there is no element of choice in her consignment to the cinder-clogged corners of the house. The "haughtiness" of the step-mother has turned to wickedness; the class conflict is sharper, and the disappearance of the harsher nickname confirms our sympathy for the oppressed. Also, the King's son himself gives her the wonderful slipper to try on, and then puts her on his horse and rides away with her.

Here is my point. Suppose the Grimms' version had been the same as Perrault's. Suppose in particular that the Grimms had had the servants of the Prince show up at the home of Cindy's step-mother and ask to try the shoe on all the young women of the house. Suppose then that Disney's version had changed this so the Prince himself comes by and rides off with the protagonist on a horse. Wouldn't that have been denounced as a "Disneyification" of the story by the people who like to denounce such things? It was in fact sentimentalization, but Disney is not guilty of it.

Leave Disney be. And, by the way, Happy birthday, Walt.

04 December 2009

Grammy Nominations are out

The Grammies (or should I write "Grammys") give me yet another opportunity to display my own alienation from pop culture.

Beyonce was nominated for 10 awards. Taylor Swift for 6. Kanye West also for 6. Make your own joke there.

I wonder if Kanye West likes fishsticks?

Yawn.

03 December 2009

The Sense of Beauty (1896)

It comes to mind for no reason except the thought that it has been too long since I've said anything here about either George Santayana or the field of aesthetics. Let us right both wrongs today. Santayana's first book, The Sense of Beauty was also the first major work on aesthetics written in the United States.

What does it tell us? It is remembered chiefly as the source of the definition of beauty as "pleasure objectified," and (although the book says much else of interest) -- let us stay with that. What does that expression mean?

It means, firstly, that "objectified" is not the same as "objective." It is not quite the same as "subjective" either, although "objectified" is a subset of "subjective."

Pleasure, after all, is subjective, and beauty is one specific sort of pleasure. But, secondly, of what sort? Some specific pleasures are called beautiful because they are so closely associated with the external object by which they are caused that, by an act of socially acceptable delusion, we attribute them to that object. "The more remote, interwoven, and inextricable the pleasure is, the more objective it will appear" -- is how Santayana at one point puts it.

A rose scented perfume is not "beautiful," though I may find it pleasant. The perception of the rose itself may give rise to the sense of beauty, because that scent is intermingled with the proximity of flower to thorns, the juxtaposition of red with green, the stubborn particularity of the branching -- all this is interwoven, and no element can be extricated from the whole without loss. So our pleasure in the rose is of the objectified sort. It is ... the sense of beauty.

29 November 2009

"Bread, Please" as Conditioned Response

I'd like to pursue the ideas to which I alluded here a week ago.

B.F. Skinner's book, Verbal Behavior (1957), grew out of a series of lectures he gave at Harvard in 1947-48. It naturally draws my attention that these were the William James Lectures, sponsored jointly by Harvard's Departments of Psychology and Philosophy. This is a series of lectures that began in 1930 and continued until the 1980s, and that hosted some of the most illustrious thinkers of that period within the interchange of those two disciplines. Just for example, not to elevate those above the others: Arthur Lovejoy gave the WJ lectures in 1932-33; Karl Popper in 1949-50; Gabriel Marcel in 1961-62.

The fact that Skinner gave his lectures on "verbal behavior" ten years before the publication of the book of that name would seem to suggest a considerable modification between the one format and the other.

Anyway, the book may be found here.

He defines "verbal behavior" in the first instance as "behavior shaped and maintained by mediated consequences," i.e. that has its desired effect through the actions of a listener. The desired effect of "bread please" is to persuade someone else at the table to move an object around, where physical constraints or social convention prevent the speaker from obtaining the bread for himself. Skinner later refines that definition a bit, but that remains a key to his approach.

"Bread please" seems a behavior generated by operant conditioning in a rather straightforward way. For a youngter, saying "bread" will suffice to get the bread. Indeed, one's parents (the conditioners) will likely be delighted that their child can form the word, so they will happily reinforce that speech by handing over a piece of bread. Later, though, "bread" earns only frowns unless modified by "please," so the growing child is brought within the scope of social convention.
More elaborate usages of language are only very complicated instances of the operation of much the same mechanism whence comes the phrase "bread please." That, at any rate, is Skinner's view. One of its advantages in his eyes is that it gets rid of the idea that words have meaning in the sense in which "meaning" might be something inside the brain and hidden from science. Words only "mean," for Skinner, because they get listeners to do things, and the doing is "as observable as any part of physics."

That is enough for today. I will say more soon about why Chomsky objected to the study of language in these terms, how later Skinnerians reacted to Chomsky, and how the dispute feeds into the question of the differentia of the human species.

28 November 2009

A Story and a Joke

Thursday night, I mentioned the gist of the following story to one of my companions at the feast. I've fleshed it out a bit since.

Many years ago, my best beloved, a brave group of harried and godly folk became tired of the game known in the old world as "football."

William Bradford said, "This is a stupid game. Let us travel to a distant place, where we can invent a better game and call IT 'football' instead."

And Captain Standish said, "I will lead the way."

Then said John Alden. "When we get there, we can assign a new lame-sounding name to the game we have rejected -- but I fear I am not the right person to invent the adequate nomenclature."

Priscilla. "Don't be so timid John. I'm sure you can come up with a good idea. Speak for yourself!"

John, emboldened, said: "Ah, then, let us call it 'soccer'! And let us never play it again!"

And they all said "Amen" as they walked aboard the Mayflower.

---------------

And as the holiday drew to a close, I watched a DVD of one of Jerry Seinfeld's old standup routines.

In the funniest bit, he talked about how sky-divers wear helmets. This seems odd to him, since in the event the 'chute doesn't open, the helmet won't save you.

"If the chute doesn't open, you're there as a cushion for the helmet. Later, all the helmets will get together and this one will tell his buddies the story. 'Yes, it was a close call. I would have been smashed up pretty awful if I hadn't had a human strapped beneath me.'"

27 November 2009

Egypt: A random bit of history

From an article entitled "Arab Government Responses to Islamic Finance: The Cases of Egypt and Saudi Arabia," by Rodney Wilson, published in Autumn 2002 in the journal Mediterranean Politics.

Ali Sabri became Vice President of Egypt under Sadat, but he was dismissed from his post in May 1971, as Sadat alleged that he had been planning a coup. With the demise of Ali Sabri, al Najjar wasted no time in making a second attempt to start an Islamic bank in Egypt. This time the government was more receptive to his ideas, and the Nasser Social Bank was established under a special statute, Law 66 of 1971, which meant that it did not have to register with the Central Bank or be regulated by it....The first general manager of the bank was Dr Abd al-Aziz Hijazi, a former Egyptian Prime Minister who knew little about Islamic banking, but who was a trusted establishment figure.

Question: why was the government, prior to Ali Sabri's dismissal, hostile to the idea of an Islamic Bank?

My personal view is that Sadat was at first riding the post-Nasser wave of Arab nationalism. Arab nationalist ideology is a very different thing from Islamicist ideology, of course (as the generally secular orientation of leaders such as Nasser and Sadat serves to illustrate. The creation of a bank with specifically Islamic features may have seemed a dangerous concession to Sadat in his first year in office. After the abortive coup (real or imagined) of Ali Sabri, though, Sadat may have been more interested in finding domestic allies, and might have thought this a necessary concession, after all.

Notice that the creation of an institutioin for Islamic finance came with a symbolically important caveat -- a name that included Nassar's, and that gave no indication that there was anything specifically Islamic about this institution. That, and the leadership of Abd al-Aziz Hijazi, whom Sadat clearly considered safe.

I'm just guessing, though. If you know beter, feel free to correct me.

26 November 2009

Thanksgiving Day

With all due respect to the Pilgrims, to the traditional sentiments of harvest time, and to expressions of gratitude, both cosmic and local, Thanksgiving Day is among its other functions the day that traditional rivalries play out on football fields -- the fields of both high schools and colleges.

I can't speak to today's games because I'm not writing this today. I wrote this last weekend for posting today. (Ain't I clever? Ain't technology wonderful?) But I will take this opportunity to express my regret at the end of the old Fermi-Enfield rivalry. This year's game between the two public schools of the town of Enfield, Conecticut will be the last in a string that goes back to 1972. Enfield will join the Pequot Conference as a full member next season, and the rules of that conference prohibit games outside said conference.

While I'm in this mood of nostalgia and regret, allow me to note (not that you have any choice) that there were several traditional Thanksgiving Day rivalries of recent decades in northcentral Connecticut that are no more, mostly because one of the other of the high schools involved has disappeared. New Britain would play Pulaski; Penney would play East Hartford; Middletown would play Woodrow Wilson High. But one of the schools in each of those pairings is no more.

Ah, but now I need to cheer myself up. What about that UConn/Notre Dame double-overtime game this past weekend? Was that amazing? Congrats to coach Edsall. This was the best possible recruiting poster for him as he builds a program fit for the national stage, doing what Calhoun managed to do for the same school's basketball program years ago.

Yeaaaah Huskies.

22 November 2009

Animal language

If language is just "verbal behavior," as Skinner said (1957), then there is nothing special about human language to separate itself from the singing of birds or the barking of dogs. It is on exactly this point that Chomsky (1959) picked his famous fight with Skinner, and insisted that human language is something special.

Although Skinner himself never responded to Chomsky's critique, others have done so on his behalf in the intervening half century. Here is an example from
1990.

Personally, I have long been fascinated by experiments into "animal language" in a rather specialized sense of the term -- not "animal verbal behavior" in a sense that would involve barks or tweets especially. The implicit, and often the explicit, view of many who study the language of whales, or who teach sign language to primates, is that language in a specifically human sense has non-human application. Maybe language in the narrower sense of the term, though rare, is not entirely unique to our species.

Just some plankton for thought.

21 November 2009

In the House of Representatives

The House Financial Services Committee voted 43 to 26 Thursday in favor of a measure sponsored by Ron Paul (R-TX) that would expand Congressional oversight authority vis-a-vis the Federal Reserve.

As the Wall Street Journal rightly noted yesterday in a front page story, this vote was part of a general backlash of "populist anger that Wall Street was bailed out while the public was not." Actually, I think (and hope) that there was more to it than that, but I approve of the backlash, however defined, and so I'm inclined to be happy about this vote.

The problem with central banking isn't the opacity of the bank's operations vis-a-vis politicians or their constituents. The problem with central banking is ... central banking. As an institution, it is inherently misguided. Even if Paul's bill should pass, it will amount to little more than some additional work for the GAO in auditing the Fed. Still, one has to approve of the sentiment.

Greed is not always good, greed does not always work. And the way to limit the dysfunctional consequences of greed is through keeping money real.

Separately, the House this week has amended a bill under consideration designed to reduce the systemic risk that accompanies the failure of large financial institutions. Like, just for instance, Lehman Brothers. The bill at issue is the Financial Stability Improvement Act (FSIA or HR 3996). One of the themes of the bill is the creation of a sort of polluter-pays system for the unwinding of large banks. The cost of the orderly unwind is supposed to fall upon the shareholders and unsecured creditors of the bank, not the taxpayers.

The amendment adopted Wednesday, sponsored by Representatives Miller and Moore (Democrats from North Carolina and Kansas, respectively) is designed to ensure that even the secured creditors of such institutions take a hit. If you follow that link you'll find that this amendment takes up only a page and a half, so it would be easy enough to read through if it were not written in legalistic jargon. The gist of it is that secured creditors of a bank that fails and ends up in receivership will take a haircut, in that in the discretion of the Receiver up to 20% of the secureds claim could be turned into an unsecured claim "as necessary to satisfy any amounts owed to the United States or to the [polluter-pays Fund]."

An intense quarrel has broken out over this amendment in the financial blogosphere. Felix Salmon, for example, weighs in here.

20 November 2009

A Point of Etymology

I have concerned myself in earlier blog entries here with various plagiarism scandals. Here for example.

There now appears to be a plagiarism scandal underway in the southern hemisphere. Isn't the web wonderful? How else would I ever have encountered a New Zealand newspaper story? Anyway, it appears that a novel written by Witi Ihimaera, an English Professor at Auckland University, is replete with stolen goods. So much so that he is buying back copies of his book, presumably to re-write those passages and issue a theft-free edition.

The simple and obvious question is: does Ihimaera flunk out those of his students who do stuff like this? Thank God for hypocrisy. Or, at least, for the sake of the education of the affected youngsters, I HOPE he's a hypocrite.

So let us take this occasion to be explicit about the etymology of the word "plagiarism." It comes from the Latin word plagiarius, which means: kidnapper. That seems a straightforward adaptation of meaning.

Plagiarus in turn came ultimately from the root PLAK, meaning "to weave." As one would weave a net as a snare or a trap. For kidnapping.

None of this tells us anything new about the offense, but then etymology like philosophy leaves the world as they each find it.

19 November 2009

Nine subjects at random, with links

1. Today, November 19, is the 90th anniversary of the day the U.S. Senate rejected the Treaty of Versailles, due to widespread opposition to -- or in some instances just unmollified reservations about -- US membership in the League of Nations.

2. It is also the 146th anniversary of Abraham Lincoln's delivery of the Gettysburg Address.

3. And a happy birthday to Calvin Klein (b. 1942), Meg Ryan (1961), and Jodie Foster 1962.

4. Ever wonder if there is a secret to winning stock car races? Yes. Drive fast. The Onion, as always, has the scoop.

5. But seriously (sort of): if you do care about NASCAR, you can catch up on this year's resulls here.

6. If you don't think NASCAR is a real sport, well ... you may be more interested in the ongoing debate over Bil Belichek and the punt that didn't happen. That link will take you to a column criticizing the decision to go for a first down.

7. And this link will take you to a column by one of Belichek's defenders.

8. Maybe you don't like sports. If you're up for a light-hearted look at finance news (yes, such a thing is possible), you might start with Jeff Matthews here. And then of course move on to Dealbreaker.

9. You think central bankers are a bunch of fun loving guys? You think that when they and their finance-ministry regulators from around the world get together, they do it in someplace warm, with a beach? Bermuda, maybe? You think wrong. The central bankers and finance ministers of the G7 will meet this coming February (FEBRUARY!) in Nunavut, Canada.

15 November 2009

Dickens and Bohemia

I'm looking again through Barzun's book, FROM DAWN TO DECADENCE.

Today's index-driven idleness takes us to a discussion of the sexual mores of Victorian England (pp. 575 - 577.)

While certain strata of society sought to retain "respectability," -- those in business, politics, the professions -- other strata, specifically artists and literary folk, created Bohemia in the middle of the 19th century. "It afforded cheap living, enforced no moral code, allowed modes of dress as singular as desired, and required no sustained solvency." Though first established in the Latin Quarter in Paris -- as two operas tell us -- Bohemia spontaneously developed branches.

Yet when a man of letters becomes as prominent as Dickens, he is by definition not a Bohemian, and the Victorians' attitudes toward his personal life, his "indiscretions," were ambiguous.

In 1857, after all, Dickens was much smitten by the actress Ellen Ternan. Rumors of adultery began to circulate. Dickens was sufficiently concerned with respectability that he felt it necessary to deny this emphatically, and against advice he put out a press release and published a statement in his own paper doing so. Later, as Barzun phrases it, "the young woman did become his mistress -- without his advertising the news -- but both felt guilty ever after."

These matters, scandalous though they were, did nothing to reduce the admiration in which Dickens was held by his public. Barzun cites them -- and other incidents in high-profile sexual mores in what he calls a "motley of arrangements and outcomes," as evidence of the waning of Romanticism, and the approach of "the low spirits, a resigned acceptance of the second best, that belong to the mood of Realism."

14 November 2009

Moon Water Results?

Positive!

The widely publicized experiment last month produced evidence of "significant quantities of ice on the lunar surface," NASA now says, making this convenient orbital body look good as a site for colonization, a stepping stone for the human race on the way to really distant destinations.

The director of the Lunar University Network for Astrophysics Research put things into perspective. "It is a big Wow," he said.

Gotta love that techno-scientific jargon.

13 November 2009

Bear Stearns: Venue???

After all the storm-and-stress of the last two years, the criminal trial of Tannin and Cioffi may all have come down to the discomfort the jury felt over the inappropriate venue.

Venue, by standard legal definition, is "the county (or geographical division) in which an action or prosecution is brought for trial, and which is to furnish the panel of jurors."

The Bear Stearns sponsored funds managed by Cioffi and Tannin dissolved in the spring and summer of 2007, an early sign of the severity of the subprime crisis. The two men were indicted in June 2008, in the federal district court for the eastern district of New York. Here we see the venue question.

Why were they indicted and later tried in the eastern district of New York? That district consists of Long Island, Staten Island, the Queens, and Brooklyn. Didn't Tannin and Cioffi work in Manhattan? Manhattan, along with the Bronx, constitutes the SOUTHERN DISTRICT of New York. Yes, they did. And there have been times when the US Attorney for the southern district was the big cheese in such matters, the sheriff of Wall Street (that's how Rudi Giuliani first became a national figure after all, back in the 1980s).

It appears that the prosecutors in Brooklyn wanted one of the sexy insider-trading cases for themselves. Here's a story about that general subject written with reference to cases you won't recognize, but which made quite a splash at the time the summer of 2000.

But back to the Tannin/Cioffi matter. Soon after retiring to deliberate, the jury sent the judge a brief note: "Please explain venue further." This kind of trans-district poaching it seems has costs.

12 November 2009

A Bit On the History of Architecture

A random quote from Tom Wolfe's 1981 book, FROM BAUHAUS TO OUR HOUSE.

"The battle to be the least bourgeois of all became somewhat loony. For example, early in the game, in 1919, Gropius had been in favor of bringing simple craftsmen into the Bauhaus, yeomen, honest toilers, people with knit brows and broad fingernails who would make things by hand for architectural interiors, simple wooden furniture, simple pots and glassware, simple this and simple that. This seemed very working class, very nonbourgeois....Theo van Doesburg, the fiercest of the Dutch manifesto writers, took one look at Gropius' Honest Toilers ... and sneered and said: How very bourgeois. Only the rich could afford handmade objects, as the experience of the Arts and Crafts movement in England had demonstrated. To be nonbourgeois, art must be machine-made."

08 November 2009

Dickens chronology

I've been wondering. How do we fit Charles Dickens into Barzun's over-arching theory about the 19th century in European cultural history? My continued readings in and musings about Barzun's book, DARWIN, MARX, WAGNER, combined with the release of yet another Hollywood version of A CHRISTMAS CAROL, have together brought me to this curiosity.

Dickens' career straddles the great divide between the romanticism of the early part of the century and the materialistic turn of the latter part. Barzun, remember, assigns great importance to the year 1859 in connection with that turn. So where do Dickens' works stand, on either side of that line.

Here are some of the most influential of his works, and their date of publication, with italics for the one of his great works that came out within the fateful year itself.

THE PICKWICK PAPERS (1837)
THE ADVENTURES OF OLIVER TWIST (1839)
A CHRISTMAS CAROL (1843)
DAVID COPPERFIELD (1850)
BLEAK HOUSE (1853)
A TALE OF TWO CITIES (1859)
GREAT EXPECTATIONS (1861)
OUR MUTUAL FRIEND (1865).

Dickens was a world-famous author long before 1859, and his habits of mind were settled before what Barzun saw as the turn toward mechanism. I expect that if I asked him, Barzun would likely include Dickens with the High Romantic movement. I'd rather not bother a 101 year old man with a question on such a point, though.

I've looked into his magnum opus, FROM DAWN TO DECADENCE (2000) for Dickens mentions. I have found only one -- a brief discussion of a couple of the female characters, in connection with the Victorian notion of an idealized wife as "the angel in the house." Nothing there seems to shed any light on Dickens himself.

07 November 2009

New Jersey's pension situation

Orin Kramer and William G. Clark are between them responsible for managing the state pension funds in New Jersey.

Kramer is the Chair of the State Investment Council, and Clark is Director of the Division of Investment.

Daniel Strachman, in a guest opinion column published Friday by The Alternative Press, urges the state (which, due to Tuesday's election, has a new Governor) should fire them both.

So what is the pension situation in New Jersey, that would incite such a call? Here is a primer, more than a month old but serviceable.

Paragraphs 8 and 9 of that story are key:

The latest available figures from the state, released in spring, showed state pension funds were worth $77.7 billion as of June 30, 2008, about $34.4 billion short of obligations. Similarly, the state is obligated for $50.6 billion in future post-retirement medical benefits that it annually funds out of the budget.

Following last year's economic turmoil, the latest available figures from the state Division of Investments show the state's pension funds were worth $66.7 billion Aug. 31, 2009.


Corzine' administration made some changes aimed at slowing the expenditure of pension funds, such as an increase in retirement age. But the problems have been developing through at least a couple of turns of the boom/bust cycle. In July 1997, New Jersey sold $2.75 billion of pension bonds in July 1997. Then-Governor
Christine Todd Whitman said at the time that it would be crazy "not to do this." She said the bonds, which paid a fixed interest rate of 7.64%, would keep the system fully funded and save the taxpayers money.

The fund has earned 4.8% annualized return since the bond sale. So it paid 7.64% to acquire the capital with which it has been earning 4.8%? Does that sound like a bad plan to you? Me, too.

06 November 2009

More on Roman Polanski

The emerging Swiss/US relationship is intriguing.

Somebody has apparently decided, for example, that an isolated spot in the Alps might be ideal for some of the prisoners now kept at Gitmo. Thus we get news stories like this.

There's also the taxation issue. Perhaps Switzerland wants to earn back the prerogative of being a tax-evasion haven by making clear that it is not a sex-crimes haven. There surely is more to the timing of Polanski's arrest than some Javert-like perseverance on the part of Californian investigators.

Switzerland's reputation as a tax haven has taken some hits lately. Or (to put the point positively) its repute as a member of the family of nations willing to co-operate with other nations in going after tax cheats has improved.

Indeed, it was only Friday, September 25, that the OECD promoted Switzerland from the gray to the "white list" of mutually co-operative countries. See here.

Intriguingly, it was only one day later that Roman Polanski tried to enter the country of Switzerland to accept an award and found himself under arrest on sex crime charges dating back to the 1970s.

Is there a connection between the two events other than geography? Consider, whilst pondering this, that the government of the US has a good reason to want to be friends with Switzerland, quite aside from tax revenue. Those Guantanamo prisoners have to go somewhere.

In a related development, the largest Swiss bank, UBS, especially wants to get back into the good graces of the United States after a run-in with the IRS: here.

Could UBS have been part of a back channel deal for Polanski?

None of this makes Polanski any less of a criminal sleazebag than he would be anyway. But it does add another dimension to the proceedings.

05 November 2009

Roman Polanski

I'm rather late to the fair on the Roman Polanski story. Let me, though, say this: Polanski should do some time. Behind the reluctance to agree with that in some quarters is an abominable quasi Nietzschean bunch of crap about how great artists are Ubermensch so they don't have to obey the rules of the rest of society, and that needs a rebuke.

Look at it another way. Polanski could have lived out his whole life in France, dying some day of natural causes free from any US/Californian prosecution. Is France itself a prison cell??? Hardly! It has lots of room, it has Paris, plus skier friendly mountains, some of the world's most beautiful beaches, and should he get tired of all of that ... its own Disneyland even! Not much like where he is going to be living.

So why did he not stay in France? Because he doesn't really think of himself as a fugutive, so he sees no reason why he shouldn't travel freely to accept prizes. In that sense, he is being punished not only for a long-ago horrid crime but for a very recent instance of reality-denial.

The only thing sad here is that his arrest wasn't captured on video by Dateline. This would be a great episode of Chris Hanson's "To Catch a Predator."

"Can I come in, Swiss Miss?"

[Female voice from inside] ; "Oh yes, pour yourself a lemonade, I'll be out in a minute."

01 November 2009

Wagner? A Materialist?

Continuing the line of thought I was following last Sunday, let us speak some more about Richard Wagner.

Some of my readers might have been surprised at Barzun's thesis, since it involves the inclusion of Richard Wagner, whose music dramas have a mystical, otherworldly cast to them, as part of a troika whose work led to the ubiquity of mechanistic materialism. How does Wagner belong on that short list?

As I understand Barzun's position here, there are three key points. The first involves the method of composition. The so-called "unending melody" of a Wagnerian opera is mechanically created, through an array of leitmotif, each expressing a definite character, idea, or object, so that when that character or object is on stage, or the libretto makes allusion to that idea, the musical development re-introduces the demanded motif, as an aural identification tag. It all strikes Barzun as materialistic, as if aural atoms are bumping into one another and randomly forming musical molecules.

The second key point involves the role of music itself within the larger theatrical context. His music, Barzun tells us, has no inherent appeal. Nobody would listen to the music itself for pleasure, in isolation from the story for which it provides accompaniment. The music is materialistic in that it does not stand on itself, as music of earlier eras had, but is a "program visibly objectified on the stage ... and the full dramatic program embodied in the philosophical commentary, and not simply in the libretto."

And, thirdly, that philosophical commentary to which would-be appreciators of Wagner's music are eventually directed is itself materialistic. Wagner resurrects the Norse gods in order to kill them all off, all in service of the Feuerbachian point that no God or gods created man -- men, as artists and as audiences, both create gods and dispose of them.

In his understanding of Wagner, Barzun has been seconded of late by Bryan Magee, author of The Tristan Chord: Wagner and Philosophy (2000).

31 October 2009

"I do believe in spooks"

The headline of this entry is of course the affirmation of the Cowardly Lion, as Dorothy and her three allegorical companions walk through the scary forest surrounding the witch's castle. An affirmation appropriate to today's holiday, surely.

The 19th century German logician, Christoph von Sigwart (1830 - 1894), didn't believe in the Lion's affirmation. Well ... presumably he had never walked through that particular forest. Still, let us record that he wrote: "No amount of failure in the attempt to subject the world of sensible experience to a thorough-going system of conceptions, and to bring all happenings back to cases of immutably valid law, is able to shake our faith in the rightness of our principles. We hold fast to our demand that even the greatest apparent confusion must sooner or later solve itself in transparent formulas."

The "we" in the second of those sentences is the western post-Renaissance scientific spirit, inclined to put facts into tables and draw conclusions, then impute those conclusions to God or (what is the same) the nature of things.

As Dostoyevsky knew, as his "underground man" expressed with eloquence at about the time that Sigwart was writing those words, there is also that within "us" that rebels against the "transparent formulas" in which "we" have such faith. So let the thorough-going system of conceptions have the other 364 days of the year. This one is given over to defiance, to sensible experiences that aren't so sensible, and aren't interested in "solving themselves." To flights on broomsticks and knocks on the door though nobody is there.

To the unenlightened belief in spooks. Cheers!

30 October 2009

Random bit of history

This is the first anniversary of a memorable on-camera zone-out incident involving Charles Gasparino, an editor at the business-oriented cable channel CNBC.

On their regular late-afternoon program, "Closing Bell," anchor Dylan Ratigan introduced CG, obviously under the impression that CG was in possession of some new important information about Merrill Lynch.

The camera then framed Charles with the words "Management turmoil continues at Merrill Lynch" bannered beneath his face, because the producers (and anchor Dylan Ratigan) were obviously under the impression that Gasparino was in possession of some important information abotu that subject.

If he was, he never did get around to telling the world about it. Apparently, he took offense at the way he was introduced, the open-ended phrase "what do ya got?" -- what followed was an extremely odd colloquy over the Zen-like nature of that expression.

The reason this is worth noting is that Gasparino has a new book out, specifically about those frantic days of last autumn in the US capitalist system. Maybe he'll explain to us whatever it was that his zone-out kept him from saying that day on camera.

29 October 2009

The Turnpike Series?

For the last world series between these two teams you have to go back to 1950.

Casey Stengel was managing the Yankees at that time, and Eddie Sawyer was managing the Phillies.

Yankees took the series in just four games. But in a sense it wasn't quite as lopsided as that statement may make it appear - three of the four games were decided by a margin of one run.

Game 2 actually went into an extra inning. Joe DiMaggio hit a home run in the 10th inning of that game to settle the matter.

There were five future hall-of-famers playing in pinstripes for this series. In addition to DiMaggio of course, there was Yogi Berra, Whitey Ford, Johnny Mize, and Phil Rizzuto.

That was then. As for now: Go, Phillies!

25 October 2009

A Passage from Darwin, Marx, Wagner

As a birthday present this year I received a copy of Jacques Barzun's classic, Darwin, Marx, Wagner (1940).

Jacques Barzun was (and is) a great admirer of the romantic movement of the nineteenth century in all its manifestations: the era of Beethoven, Liszt, and Berlioz in music; of Carlyle, Goethe, and Hugo in letters. He believes, moreover, that something profound and distressing happened to the movement a little past the middle of the 19th century, with the rise of a mechanistic materialism associated especially with the year 1859.

In music, it was in 1859 that Richard Wagner completed Tristan, which Barzun calls his "earliest characteristic work." In the same year, Darwin came out with Origin of Species, and Marx with the first sketch of On Capital. Each in his own way treats feeling, belief, indeed morality itself as so many illusions within the world of brute fact, of matter and energy trudging onward in meaningless ways toward ... nothing. Barzun sees the strength in the work of all three and realizes of course that they were not extraneous intrusions into their age -- they were of the age -- still, their names are appropriately joined to describe the moment. Mechanical materialism split the romantic impulse in two. Some romantics would embrace the new way of seeing the world -- and they were launched toward realism and naturalism. Others would reject this way of looking at the world -- yet their rejection was often an overly emphatic turn, leading to an empty idealism, aestheticism, or irrationalism. The year 1859, then, is a baleful one on Barzun's understanding of the course of European culture.

Anyway, here is a brief passage from the introduction. "Since belief directs action, it behooves us to take stock of the teachings chracteristic of yesterday and today, for the very sake of reason, science, and art. We have thus two motives, one theoretical and one practical, for going back to the sources of our intellectual life. I am far from saying that the world events we are living through [in 1940] are the result of 'mere ideas': that would be to espouse the very idealism I condemn. Ideas by themselves cause nothing. They are as inert as facts by themselves; or to put it another way, closer to the pragmatic view of history, facts and ideas do not occur separately from each other."

Excellently put.

24 October 2009

Fooled by Foreshortening

In some of my earlier posts, I've discussed the plot of a Ben Mezrich book, UGLY AMERICANS.

I got some important chronological points wrong, and I'd like to correct that now. Indeed, I've corrected it in my plot summary thus.

I've had a lot of trouble cross-referencing the events in the book with real-world events, and to some extent I at last understand why. Bear with me.

Mezrich tells the "true story of the Ivy League Cowboys who raided the Asian Markets for Millions." The central "cowboy" is the fellow he calls John Malcolm, who went to Japan to take a job with Kidder Peabody, apparently in 1993, then lost that job when the Joseph Jett scandal hit, the following year.

Then Malcolm got a job placing orders for Nick Leeson, which ended in February 1995.

Thereafter, Malcom called his former boss at Kidder Peabody, who was now the head of a hedge fund. The main story of the book starts there. Until now, I had believed that these central plotting events, involving the Hong Kong stock exchange's tracking fund, took place in 1995, soon after Malcolm had settled into his new job. That is the impression the book conveys. But the tracking fund at issue didn't exist then! It came into existence as a result of the East Asia currency crises of 1997-98.

But on a closer reading, I see that the story can be reconciled to that fact, and Mezrich can't be said to have simply gotten it wrong, foreshortened though his account is. At least part of the blame is mine.

There is a time clue on page 196 of his book, where Mezrich writes: "The brainchild of Richard Li, at thirty-five one of China's richest and most infamous characters, Pacific Century Cyberworks has started off...."

When was Li thirty five?

The answer is that he would have turned that age in November of 2001. This means that the Christmas party described in chapter 21 of the book, when the main characters discuss Richard Li, must have taken place in December 2001. That, in turn, makes the foollowing trades consistent with the actual existence of this fund, and with a merger in which Pacific Century Cyberworks was involved at the turn of the millennium.

"Understanding comes step by step, grasshopper."

"Thank you, Master."

23 October 2009

"Radioactive Bucket of Stress"

Well, this blog is not usually a forum for celebrity gossip, but I like the expression "radioactive bucket of stress." I'm going to take to using it myself when the chance arises. Which, I hope, will not be often.

The fact that the phrase came to my attention through a bit of celebrity gossip is, then, incidental.

Salman Rushdie, the renowned novelist who has written Midnight's Children (1981), The Satanic Verses (1988), and The Enchantress of Florence (2008) along with much else, has been romantically linked of late to Pia Glenn.

Thereafter, in the big 8th grade corridor that is the modern celebrity world, Salman and Pia had a falling out, and it was Pia who first saw fit to tell the world about it.

The world being, of course, best informed through Page Six of The New York Post.

Some novelists of Salman's stature might have seen fit to refuse to dignify that with an answer, and maybe to write a nasty caricature of Pia into one's next novel. But Rushdie is apparently made of more contentious stuff.

Here's the relevant link from Gawker. [Link fixed - ed.]

Okay, there's no reason for anybody to care. But I didn't have any other great ideas for a blog entry today anyway. And, as I say, the whole exchange did produce the expression "radioactive bucket of stress." That's writing. [See Cicily's comment below to get the proper context for that phrase.]

22 October 2009

Wall Street Journal front page yesterday

Look at the WSJ front page yesterday. It struck me as the reflection of a very odd news sense. The most newsworthy piece there is the A-head (which is usually their "human interest" story). The A-head involves the anniversary of the fall of the Berlin Wall and manages to bring to light details that are new to me.

But the other three front page headlines are:

1. Business Spending Looks Up (a worthy subject, though it could well have gone into pages 2 or 3).

2. Vatican in Bold Bid to Attract Anglicans (I would certainly have put this further inside -- important as it is to wavering Anglicans thinking of undoing the effects of Henry VIII's rashness.)

3. Mattel Hopes Barbie Facelift will Show Up Younger Rivals (the WSJ has a separate Marketing section precisely for such news items as this. What's with the front page treatment here???)

There were at least six stories breakinbg that morning that would have been more fit subjects for the WSJ (in its older pre-Murdoch days) that any of those. I'll call them "Alt" front page stories. I'll paraphrase them hereafter rather than reproduce them literally as with the italicized headlines above.

Alt1. A bipartisan panel led by Volcker is saying some important things about the debt/equity bias in the corporate tax system. That's at p. A4 here.

Alt.2. The fight over Medicare cuts and how that is feeding into the broader health care debate. Page A8.

Alt.3. Important news from Afghanistan, Karzai Accepts a runoff. That is at A13. Twelve whole pages behind the Barbie news.

Alt. 4. Taiwan's worries about mainland China's military buildup. A16.

Alt. 5. Important angle on the Galleon insider-trading arrests arrest -- connection with McKinsey. This is at C1. To be fair, the front page of the "Money & Investing" section is a pretty important piece of real estate. It is the page to which hardcore readers turn first. Still, it strikes me as more worthy of Page 1 than "Business Spending Looks Up." THAT could have fittingly headlined the C section (not that I intend drastic surgery.)

Alt. 6. US Bancorp's Buying spree continues. Are we seeing the rise of new "too big to fail" institution for the next round of bail-outs. This story raises that important question from the back of the bus. Page C5.

If this kind of news sense is the secret of the WSJ's new success, I fear for us all.

18 October 2009

England's Jurassic Coast

Shelley Emling has written a book about a somewhat obscure figure in the history of science -- Mary Anning.

That obscurity is a condition Emling wants to remedy because she considers Anning important. It was Anning who in the early 19th century discovered along the coast of England, fossils of incredible creatures -- creatures no human had ever seen -- the first examples ever discovered of what have come to be known as dinosaurs.

Dinosaurs of course are astonishing creatures even today - imagine their impact as they first emerged into the hands of a woman who was scrounging for decorative seashells to sell to make some extra cash for her poor family in the 1820s! (Yes, she sold seashells by the seashore.)

Here is a link to a National Geographic article from 2001 about England's "Jurassic Coast," the stretch of southwestern coastline that Anning's work first brought to the attention of the scientific world.

And here is a link to information about Emling's book.

17 October 2009

Vampire Squid v. Old Greenmailer

A lending unit of the Goldman Sachs Group has filed a lawsuit against the High River Limited Partnership -- an investment vehicle controlled by Carl Icahn -- alleging that High River breached contract by failing to complete a transaction in bank debt.

This lawsuit is the latest bit of shrapnel from the long complicated bankruptcy proceedings over auto-parts maker Delphi Corp. During the pendency of that bankruptcy, banks holding IOUs from Delphi were in the market to make deals, to sell that paper and whatever it might get them via the reorganization for cash.

In principle of course this makes possible some middleman profits. Icahn could have bought the paper from banks desperate to get rid of it, turned around and sold it to Goldman which (on this hypothesis) was taking a longer-term view and was willing to build up its position in Delphi debt.

But Goldman alleges that isn't quite what Icahn did. Instead, he sold them bank debt he didn't own (naked shorting it, so to speak) and then, when the time came for the deal to close, pulled out. Presumably he was hoping that the value of this paper would fall between the time he made the deal and the closing date, so he could buy it for less than Goldman had promised. That didn't happen, so he was faced with the choice of pulling out of the deal, or of buying high to sell low.

That scenario, if true, would certainly seem to be a contractual liability, if not worse. It could be fraud if he led them to believe he was in possession of the instruments.

High River says it has done nothing wrong, and I haven't even seen the complaint. I'm retailing this to you second hand. I do think it may be intriguing to watch this one develop, though.

16 October 2009

Paul Kilduff again

Recent purchased my second Paul Kilduff novel. My second in the order of discovery, his first in the order of production: Square Mile (1999).

Here is his explanation of how he came to write it.

A literary academic wrote of this book especially, and of Kilduff in general: "Such attention to detail clearly suggests that these novels are read as part of a professional discourse. The frank and detailed corrections that they inspire from their readers seem to suggest nothing less than the reflection of the pedagogical tone that the novels themselves frequently employ as they provide detailed and comprehensive accounts of the world of trading: even readers who are not inside the business are encouraged to feel as if they are. Indeed, publishers' acounts of the reading habits of City workers suggests how difficult this market has become and note that 'City fiction' (rather than professional guides or 'guru' texts) have become 'the only way' publishers can make 'real money' in the City."

That literary academic is Nicky Marsh, a Lecturer in the Department of English at the University of Southampton, and the book whence I've just quoted is "Money, Speculation and Finance in Contemporary British Fiction," (2007).

I've been writing about finance day by day or week by week for nine years now, with a fair amount of attention to the London venue in which Kilduff sets his tales, but there is still much to learn, and this is a painless way to learn it. Higher pretensions than that the books can not make, nor will I make such pretension for them.

15 October 2009

When the Slow Train Came

Thirty years ago today, on October 15, 1979, Bob Dylan released SLOW TRAIN COMING, an album of music expressing his new-found convictions as a fundamentalist Christian.

In an interview he gave five years later, Dylan said: "The songs that I wrote for the Slow Train album [frightened me]...I didn't plan to write them...I didn't like writing them. I didn't want to write them."

The cover art for the album displays a man holding a cross, but appearing ready to swing it like a hammer, so that the crossbar of the cross will presumably drive a spike into a railroad line under construction.

Dylan's album, and his conversion, had the distinction at any rate of inspiring John Lennon to write "Serve Yourself," with lyrics like this:

You tell me you found Jesus. Christ!
Well that's great and he's the only one
You say you just found Buddha?
and he's sittin' on his arse in the sun?

11 October 2009

If the court can not come to Chase

Cliff Sloan and David McKean have written The Great Decision, a book about the Supreme Court's decision in Marbury v. Madison. The subtitle portentously speaks of "Jefferson, Adams, Marshall, and the Battle for the Supreme Court."

But what the book adds are matters interstitial to the main line of the narrative, a main line that is after all fairly well known already to the sort of folks who would consider reading such a book.

I like the bit about Samuel Chase and the gout. Chase suffered from that affliction so badly in February 1803 that he could not hobble the short distance from Stelle's Hotel, where he was staying, to the Capitol, where the court was meeting.

Meanwhile, Justice Cushing was ill in Massachusetts and Justice Moore was apparently also ailing and absent. So Chief Justice Marshall could not get a quorum.

What did he do? He moved the site of the meetings to the lobby of Stelle's. Chase could thus attend.

But by the morning of February 24, when the result in Marbury was announced to the world, Moore too had recovered sufficiently so that he could attend, so everyone other than Cushing was there in the lobby of the Hotel. In addition to Chase, Moore, and Marshall, there was Bushrod Washington, the nephew of the First President (and thus the cousin of his country?), and William Paterson.

A neat anecdote, though if you want some broader resonance to it you may have to look elsewhere. Gout is gout, not a symbol of constitutional crises or of their resolution.

10 October 2009

Water on the Moon: the Linkfarm edition

Yesterday, Friday, two rockets plemmeted into the moon, creating debris plumes that should now give scientists some sense of not just whether, but how much, water there is on that body.

Some relevant links. This is how NASA's PR video on the project portrays it.

The story has gone global.

And here is commentary from The Chicago Sun-Times.

But the actual event seems to have been a disappointment to some would-be observers.

Jon Stewart found in a television news report on the subject his Moment of Zen., for October 8.

I'm not the only one reminded of Robert Heinlein, thank heavens.

09 October 2009

The return of Polaroid film

Martin Waller, who writes the "City Diary" for the Times of London, informs us that there is a serious effort underway to bring back Polaroid film.

On February 8, 2008, Polaroid (by this time under the control of Thomas J Petters of Petters Group Worldwide) had announced that it would cease production and withdraw from analog instant film products completely over the course of that year. This annoyed those with either a nostalgic or an aesthetic appreciation for those products.

Although Waller's brief mention was the first I had heard of the effort to revive, with a little googling I discovered that this has been underway since January 2009 -- spearheaded by Florian Kaps (an Austrian photographer) and Andre Bosman (a former Polaroid exec.)

Personally, I have a philosophic/aesthetic reason for wishing them Godspeed.

I think that many of my own aesthetic preferences can be summed up as a desire to have the "tigers in India," as James would put it, fairly represented to me, from a distance.

I prefer live theatre to any sort of movie, digitized or filmed, in part due to the sense that what I'm seeing is unique. The actors may have spoken these words a thousand times before to each other, but will only speak them once to this precise audience.

But are the actors the "tiger," and is my preference for live theatre a preference for being in its immediate presence? Not really. If that were so, I might be more of an enthusiast for improv than I am.

The "tiger" is the script, and its author's intent. I'm necessarily at a distance from that, but I want to feel that the actors are representing that faithfully to me.

The same can be said of music. I've never been an enthusiast of jazz, because it is so thoroughly imbued with an improvisational ethos, and I want to think of the singers or instrumentalists as carrying out the intention of some (alive or perhaps long dead) composer and/or lyricist.

The same Tigers-in-India impulse carries over to the distinction between film and digital photography. Film, including the classic Polaroid products, captures a moment with a physical/chemical process that carries forward that moment to a future observer. Digital doesn't capture -- it re-creates. And the triumph of digital photography seems to me part of a general and lamentable flight from physicality.

In their own sphere, then, Kaps and Bosman are doing valuable work, and perhaps will save Antaeus from the grip of a digital Hercules who is keeping him from the refreshing influence of Gaia, of physical nature.

08 October 2009

The Last Tycoons

I was skimming, recently, through a book off one of my shelves, called The Last Tycoons (2007) by William D. Cohan. The book takes us in an unexpectedly compelling way through the history of Lazard Freres & Co., the investment banking partnership founded back in the late 1840s, just in time to benefit from the flow of gold out of California -- and that continued as a partnership until 2005, when it succumbed to the logic of the corporate form and an IPO.

Anyway, I found a tidbit in this book that rather diverted the flow of my own stream of consciousness. Lazard was deeply involved in the ITT/Dita Beard scandal of the Nixon years, a matter discussed here in some detail.

When the SEC's investigation of that was finally resolved in a settlement, in October 1976, The New York Times took note of the fact in a brief inside story (p. 78) by Judith Miller.

Judith Miller? This appears to be the same Judith Miller whose more recent career is associated with "weapons of mass destruction" and imprisonment to protect Scooter Libby.

At any rate, back in '76 she wrote a 408 page story about a twenty-six page settlement agreement. Her story said that the document sheds "new light on one of the most complex and controversial mergers in corporate history," but her story doesn't say anything about what if anything that light revealed.

What that light revealed was a series of confusing machinations that apparently allowed Lazard to pull well over $4 million in fees out of this one transaction, by structuring it as several transactions and charging separately, so that the deal became as Cohan calls it "the gift that keeps on giving."

It is all under the bridge now, but Miller's involvement, and her much recent headline-worthiness in her own right, makes it intriguing.

04 October 2009

Reasons to vote "None"

The Religion blog of the Dallas Morning News has run a symposium on the reasons why growing numbers of Americans see ourselves as non-affiliated with any religion, voting "None" in a poll on the subject.

The symposium is introduced by reporter Wayne Slater, who writes: "A new study by Trinity College suggests that more than one in five Americans will identify themselves as "Nones" in religious terms in 20 years (up from 15 percent now). Most would not consider themselves atheists. But they are increasingly skeptical of organized religion and clerics."

Well, the study isn't all that new. In March of this year I summarized its results of this study in this blog. Still, when we are talking about eternity, who sweats the months, right?

Anyway, the Dallas symposium includes an intriguing contribution from Cynthia Rigby, W.C. Brown Professor of Theology, Austin Presbyterian Theological Seminary. Rigby says there are three reasons people vote "none." There are self-conscious doubters and deniers on the one hand.

There are secondly, those who "just aren't that interested in it," -- that is, in religion and the questions with which it deals.

And there are, thirdly, some for whom "none" means not so much "no religion" as "no single religion." Pluralists who are trying to craft a collage rather than embracing a creed. I like that break-down. And I'll keep working on my collage.

03 October 2009

Split Strike

One gets the impression, from the OIG's report on the SEC's decades-long failure to nab Bernie Madoff, that the SEC staff is full of people who don't have any clue what a split strike strategy is, much less what factors rendered such a strategy a highly implausible explanation of Madoff's claimed results.

Indeed, perhaps some of the staff members thought split-strike conversion was a bowler's term.

Well, Bernie got a 7-10 split in the end, but it was because of the rush to redeem on the part of his investors, which rush in turn produced his anguished confession to his sons. It decidedly was not due to any detective work by the SEC.

Speaking of those sons....The financial-industry gossip site Dealbreaker is on their case. I'll just give you a link to that. It is a lazy link farming type of morning.

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.