Top Financial Stories 2011

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 "Digital Revolution" or "EU unraveling." 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, and in the list below (an innovation this year) I'll spell out and italicize the theme. Yet the theme itself isn't the story.

Further, I don't rank them, as in a top ten list. I assign one top story to each of the twelve months.

All that said, here is this year's list.

January: Isolating Iran. After the Central Bank of India, under pressure, withdraws from the Asian Clearing Union (which had been a crucial conduit for payments to Iran for petroleum), Indian companies that import oil from Iran scramble to find another way to send their payments and keep the flow going. Their substitute arrangement involved payments through the Hamburg, Germany based EIH Bank. The isolation of Iran would become a bigger theme for many industrialized nations later in the year, but we may as well use this as the kick-off.  

February:  food versus fuel. The US Department of Agriculture announces deregulation of one strain of genetically modified corn -- a strain designed for use as ethanol, the gasoline substitute. This announcement feeds into several ongoing stories -- one of them is the widening perception of the failure of ethanol (at least the traditional "first generation" sort) as an instrument of policy.

March: Banking for the poor. The central bank in Bengaldesh dials up the conflict over microfinance, ordering that the Grameen Bank cut its ties with its founder, Yunus. Arguments in that country's high court Monday, March 7.

April: Nuclear power. Continuing crisis at Japan's Fukushima I nuclear power plant forces advocates of nuclear power generation world-wide onto the defensive. On April 11, Japan's Nuclear and Industrial Safety Agency rated the disaster as a "major accident" or a level 7 event on an internationally recognized scale.

May:  Exchange consolidation. Nymex OMX Group and the Intercontinental Exchange (ICE)  withdraw their hostile bid for NYSE Euronext, apparently leaving a clear path for NYSE's friendly merger with Deutsche Boerse. 

June:  Political scandal. Oops. Time reporter Michael Grunwald writes this month, "reports of Solyndra's death have been greatly exaggerated." But they weren't. The company, an Obama administrration  favorite, would file for bankruptcy two months later.

July:  Digital revolution.   Bankruptcy of famed bookstore chain Borders turns into a liquidation proceeding as re-org plans fall apart.  Bricks-and-mortars retailing takes another in a series of hits.

August.  Fiscal policy. US Congress and President seek to resolve long-running debt-ceiling soap opera.  S&P downgrade of US Treasury debt. End up just perpetuating the soap opera.

September:  Banking. UBS Rogue trader Kweku Adoboli arrested, September 15, 3:30 AM London time.

October: Allegations of naked-shorting conspiracy and pushback.  Ali Nazerali brings a libel suit in Canada against Deep Capture and affiliated entities.

November.  Retailing turmoil. Releases by Amazon and Barnes & Noble unleash the dogs of war, against each other and Apple, in the retail market for tablet computers.

December. Fiscal policy.  France and Germany develop an ambitious joint plan to turn the eurozone -- or perhaps the whole of the EU -- into a fiscal union. Cameron, for the Brits, keeps his distance.

Yes, there is a hometown bias to this compilation. Seven of the twelve top stories are North American in character, six of those are US based. The five that one might attribute to the rest of the world are divided among western Asia (two), eastern Asia (one), and Europe (two).

I have no proposals as to what you might make of that.

Happy new year, everyone.

Cycles of American Politics

The presidential election circus upon which we are well launched strikes me -- solipsistically -- as a contest not among individuals, not between parties, but between two theories I've long carried about in my head about how US politics works.

I've written of these theories before.  Here is one example. What I think of as the "short cycle" theory postulates cycles that are roughly 30 years long -- so either 32 or 28 years, since 30 itself is not divisible by 4. Obama's election in 2008 can be compared to the election of other relatively obscure figures who carried on the impetus of a reform movement past its prime. A haberdasher in 1948 elected as a last hurrah for the New Deal. Four years later he bowed out, letting Adlai Stevenson take the fall for Eisenhower's victory. Twenty-eight years after 1948 brings us to 1976, when a peanut farner was elected as a final upsurge of New Frontier/Great Society sentiment. Four years later he was mugged by a Kennedy on the way to a re-nomination that proved worthless.

But there is also a "long cycle" theory. According to this, there have been three great periods of constitutional equilibria in US history, separated by chaotic periods of tumult. (There were also two distinct imperial periods in American colonial history, separated by a period of tumult in the 1680s.)

It certainly appears as if the Third Republic ran aground in 2007-08 in much the same way that the Second Republic ran aground in 1929. If that is so, then we are in the midst of a period of turmoil or chaos, and when the dust settles we shall find ourselves with a new equilibrium, a Fourth Republic. If this cyclical theory is right, then Obama is a Washington, a Lincoln, or a Roosevelt, and 2012 is not 1952 or 1980 all over again.  It is 1936.

I enjoy the contemplation of both theories, and I have carried them both around in my head. Now I find that they are in stark conflict, and that one of them seems about to receive its falsification.  My only regret is that I have but two theories to give for my country.

The Mereological Fallacy

Philosopher Anderson Brown contends that much of our confusion about the mind-body problem is a "mereological fallacy," a confusion about parts and wholes.

The stomach doesn't "have lunch." The stomach digests, which is part of the process, but we don't accordingly say that the stomach has lunch, and we don't think of the activity of having lunch as internal. It is a fact about our behavior.

Likewise, the brain doesn't think. Brown doesn't give a name to exactly what the brain does -- what is the equivalent of digestion here? "impulse processing"? -- but it isn't "thinking," anyway. A person thinks and, as with lunch, there is nothing internal about it.

I'll reproduce here in italics the comment I made on his site, except that I'll clean it up a bit for this blog.  I was a more-than-usually sloppy typist in the comment section of his.

I'm reminded of one aspect of Julian Jaynes' theories, in his book on the breakdown of the bicameral mind.

I don't have the book with me so I'll work from memory, and more than usually subject to correction. But Jaynes said that the "bicameral mind" was not "conscious" in the way in which we are, NOT just for reasons of neurology, but because certain metaphors hadn't come into use yet. The idea of a sort of theatre "inside" the human body -- chest or head, depending on who is writing -- started as a highly literary metaphor, and gradually became an essential part of how people saw themselves. THAT was the "breakdown" of Jaynes' title, when the metaphor became generally accepted as a literal fact. Thus, "consciousness" pulled itself into existence by imagining itself, if you will.

This seems akin to your point, except for chronology.

Yet implicit in Jaynes' account is the point that we don't really have a choice. Going back to the bicameral mind is not an option. Or, in your terminology, thinking of thought as a fact about behavior, like lunch, isn't really an option either. The notion of an inner space where we deliberate is something more than a useful fiction, it is a constitutive fiction.

Perhaps rather like the fiction that the elite group of white men that gathered in Philadelphia in 1787 had any business speaking for "We, the people" of the United States.

From JM's Nativity Ode

This blog has its seasonal traditions.  Enjoy!

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.

John Milton, Nativity Ode (1629)
[lines 135-148].

Read the whole here.

And Merry Christmas.

The Rabbit books

Reading one of Updike's Rabbit books.  So that it will be listed once in this blog, here is the publishing chronology:

Rabbit, Run (1960)
Rabbit Redux (1971)
Rabbit is Rich (1981)
Rabbit at Rest (1990)
And a short story, portraying the lives of some of the series' characters after Harry Angstrom's death,  Rabbit Remembered (2001)

I've often said (in this blog and elsewhere) that the Rabbit series does not contain Updike's best work. The Updike I admire writes novels of ideas, where vivid characters debate theology or other weighty matters in terms often academically informed but never dry.

Roger's Version fits that description, as does Memories of the Ford Administration, the Bech series, and In the Beauty of the Lilies.

The Rabbit series, though, is the story of an uninteresting ex-jock growing up and growing old, having what we are to take as paradigmatic crises -- paradigmatic for working-class white American men of the second half of the 20th century. Not my cup of tea, though not without some of the characteristic Updike flair.

And today is a lazy Christmas eve day, so I won't try to think of something clever to write about instead. .

SPOILER ALERT: I'm not shy about giving away plot twists in what follows.

Angstrom got the nickname "Rabbit," a reference to his small nose, and to his leaping agility,  during his basketball-star days in high school, in the late 1940s. When we first meet him in Rabbit Run, those days are already a memory -- it is the mid 1950s and Rabbit is selling kitchen gadgets. He is married, has a two year old son, and his wife (Janice) is heavily pregnant with their second. In the course of that novel, the baby is born, and later dies, drowned in the bathtub in a way that implicates both Harry and Janice, though they escape from legal consequences.

Rabbit Redux  begins in 1969: indeed, it begins on the day that Apollo 11 takes off for the moon.  The town where these novels are set, Brewer, PA., is an old-line industrial sort of place, and one of its businesses made one of the electronic components crucial to the success of Neil Armstrong et al. The local paper runs a story beginning:

"When Brewerites this Sunday gaze up at the moon, it may look a little bit different to them.
"Why?
"Because there's going to be a little bit of Brewer on it."

Angstrom is the one to set those words in type, because he is employed at a print shop, while Janice works at an auto dealership her father owns.

Janice and Harry go their separate ways in the course of this novel. Janice saves her lover while he is suffering a heart attack and Harry lives for a time with a young woman named Jill, who is closer in age to his and Janice's son (Nelson) than to Harry. The plot eventually kills off Jill in a house fire -- Harry and Janice reconcile.

By the time we reach Rabbit is Rich, the year is 1979. Janice's father is deceased, and the Angstroms have inherited the above mentioned dealership (selling Toyotas). As the title of the novel indicates, that vastly improves their material circumstances, though they still live in Brewer,which by this point represents the decline of US industrial might -- no more bits of Brewer are heading to the moon, because America has closed down the Apollo program.

In Rabbit at Rest, Harry is in retirement in Florida the late 1980s, and the news is full of the destruction of Pan Am 103 over Lockerbie, Scotland. Nelson Angstrom now runs the Toyota dealership -- and is running it either incompetently or crookedly. During a sunfishing expedition, Rabbit rescues his visiting granddaughter, Rebecca, (Nelson's girl) from drowning. This gives him a sense of redemption from his guilt over the death of his daughter all those decades before, yet the exertion weakens his heart contributing to his own demise.

The Melodrama of the Rupee

In Oscar Wilde's "The Importance of Being Earnest," Miss Prism tells Cecily, "you will read your Political Economy in my absence. The chapter on the fall of the Rupee you may omit. It is somewhat too sensational. Even these metallic problems have their melodramatic side."

Wilde's humorous intentions notwithstanding, the rupee is now providing the world with some melodrama. As Shubha Ganesh of The Economic Times wrote last weekend,  rupee depreciation has become a pressing concern of the government there "as a weak currency is expected to impact the domestic treasury as India meets 80 percent of its energy needs with imports."

Private companies in India, notably Reliance Communications (RCOM) a huge telecomm concern, have a lot of bonds reaching maturity in 2012, many of them foreign currency convertible. As another story this week in The Economic Times noted, "the timing could hardly look any worse."

A company that has issued, say, $1 billion in FCCBs is committed to pay the rupee equivalent of $1 billion US dollars when the bonds reach maturity. That is surely a key reason why the bondholders bought that sort of bond, why they've proven so easily marketable, after all: FCCBs let the buyers hedge themselves against any melodramatic fall of the rupee at the expense of the issuer.

If a major Indian company could find itself incapable of meeting those obligations -- well, we are all familiar with the ways of corporate metaphorical dominoes these days.

Yes, Cecily, this could get a bit too sensational.

RIP Christopher Hitchens

Hitchens died a week ago. Here's an obit, as it appeared in the Philadelphia Inquirer.
A quick search shows that this blog has made reference to Hitchens' work three times.

The first time was after my Bloomsday trip to Dublin in June 2007, and I reported that I had met him in an elevator in that city:

http://cfaille.blogspot.com/2007/06/christopher-hitchens.html

A year later, I made a rather snide remark about Hitchens and his "village atheist" pose at the end of a post about Scholem:

http://cfaille.blogspot.com/2008/05/mysticism-and-scholarship.html 

Again this spring I invoked Hitchens as a token of that type:

http://cfaille.blogspot.com/2011/04/from-yahooanswers.html 

Aside from his proselytizing for atheism, though, the other fact about Hitchens worth noting is that  his political journeying replicated that of the neoconserativces of an earlier time. I use the word "neocon" in what I take to be the faily narrow and correct sense, not as a loose term of abuse as it is often used these days.

A neocon in the relevant sense is generally a secular intellectual who adopts conservative views on what he takes to be practical grounds, often after a leftwing youth. Historically, many neocons happen to come from a Jewish ethnic background: Norman Podhoretz, Irving Kristol, Bill Kristol, etc.

The original neocons (the first two of those three among them) adopted conservatism after a disillusionment about communism, and they became identified with the view that the stronger the US in the world, the weaker international communism, the better for humanity.

On October 21, 2002, the Washington Post ran an opinion piece by Hitchens entitled "So Long, Fellow Travelers." It was precisely the sort of piece that could have been written by one of the original neocons in the 1970s. But with an update for the era. The new threat to all Hitchens held dear was Islamofascism (his coinage, I believe), and his disagreement with his former colleagues on the left was that they are soft on it, and he would no longer be.

His journeying is now over, his friends will remember him fondly, and the readers he infuriated might benefit as they recollect that passion in tranquility.

Caring only about your work

The philosopher Nel Noddings once (in 1984) wrote: "Most of us commonly take as pejorative, 'He cares only about money'; but we have mixed feelings when we hear, 'He cares only about mathematics' or 'She cares only about music.' In part, we react this way because we feel that a person who cares only about money is likely to hurt others in pursuit of it, while one who cares only about mathematics is a harmless and, perhaps, admirable person who is denying himself the pleasures of life in his devotion to an esoteric object."

I do think this is a fair general statement of the usual connotations of such sentences. In the spirit of expanding Noddings' comment, we might observe: Someone who cares only about mathematics may be a harmless drudge, or may end up discovering a mathematical anomaly in radio waves that in turn improves worldwide communications for the good of us all. Someone who cares only about money may obtain it by violence or fraud, doing active harm to others.

More generally, we often extend respect, even if it is a grudging respect, to anyone who is "married to" his occupation, especially if it is an occupation which may derive some of its appeal from the intellectually challenging nature of the work.  "He cares only about his work" said of a lawyer or an engineer, is no bad thing.

Still, I think Noddings goes a bit too far when she writes about how such a person is "denying himself" pleasures of life outside the job: suggesting that this is a praise-worthy sacrifice. If our mathematician prefers the blackboard and the computer lab to the pleasures of, say, sexual relations, child-rearing, neighborly comaraderie, adopting the former over all of the latter is no sacrifice.

OTOH, if a mathematician believes that he has a duty to stay at the blackboard hour after hour, because the human race needs better exploitation of radio frequencies, then I can imagine that his doing so would be a praise-worthy sacrifice. But in such a case, we would not in any case express the situation by saying that he "cares only for" the mathematics.  

William James Quote of the Day

"[A]lmost all the retinal shapes that objects throw are perspective 'distortions.' Square table-tops constantly present two acute and two obtuse angles; circles drawn on our wallpapers, our carpets, or on sheets of paper, usually show like ellipses; parallels approach as they recede; human bodies are foreshortened; and the transitions from one to another of these altering forms are infinite and continual.  Out of the flux, however, one phase always stands prominent.,  It is the form the object has when we see it easiest and best: and that is when our eyes and the object both are in what may be called the normal position. "

Principles of Psychology, Chapter 20, "The Perception of Space."

This Day in Cosmological History

December 16, 1915 was the publication date for Albert Einstein's GENERAL THEORY OF RELATIVITY.

He had published the "special theory" of relativity (SR) ten years before. It is SR that incorporates the principle that the speed of light is the same for all observers, and this led in turn to the intriuguing idea of time dilation. This is sometimes explained in terms of a thought experiment.  Imagine you are travelling at the speed of light -- riding on a photon, so to speak. You are getting farther and farther away from a clock which, in your 'inertial framework,' is stationary. You won't see any movement of the hands of that clock because no new information from that clock can reach you -- you're going as fast as the fastest speed at which information can travel, by hypothesis. So the clock is frozen.

If there are any particles that can travel faster than protons, as scientists at CERN now seem to be saying, then Einstein's view on time dilation needs revision. For if so, then (to revert to our thought experiment) you might be able to receive information about subsequent movements of the clock's hands while riding on a photon -- if the new information is conveyed by a stream of neutrinos rather than by other photons.

Anyway: ten years later, on this date, Einstein published a follow up work, on general relativity, which explained gravity as a consequence of the curvature of space-time. This GR centers on the following equation:

 R_uv - (1/2) g_uv R = (8 Pi G/c⁴) T_uv .

I won't pretend to 'get it,' but I'm told that if R_uv    is taken as equaling 0 you have flat space-time, roughly the sort of thing you learned about in high school geometry. The  T_uv represents the distribution of matter and energy, so the equation as a whole shows the relationship between matter-energy on the one hand and space-time on the other. A theory can't get much more "general" than that!

Frivolous Walk-Out: Classy Response

Early this month, Harvard students staged a walk-out in a class taught by professor Greg Mankiw. You can read their explanation here.

It takes a lot of scrolling down through the comments to get to what I had to say about that, so I'll save you the work, dear blog reader.

They’re students at Harvard, yet they can’t express themselves better than this? I’m dismayed. Here’s a simple stylistic point: “basic” and “fundamental,” in the sense in which those terms are both used in the final sentence of the third graph, are synonyms. To use both with a disjunctive, “more fundamental or basic,” is just bizaare or eerie. [See what I did there?]

Far more important, there IS of course a reason why Adam Smith’s work should be taken as more “fundamental or basic” than Keynes’. It is in point of historical fact more basic. Keynes, whether you agree with him or not, was building on a century and a half of prior work. Keynes and Smith are not competitors any more than Einstein and Newton are competitors. In each pairing, the work of the former would simply have been inconceivable without the prior contributions of the latter.

If you think you have mastered Newton, then you can go on to the study Einstein, and perhaps some day to have an intelligent opinion about Higgs’ boson. Otherwise, you’re likely to end up confusing a boson with a North American bison.

Indeed, this is what Mankiw himself has said about the situation. I confess I hadn't checked out his response before writing the above, but I've seen it now, and he has sensibly risen above the rancor directed his way. He has posted on his blog a video of a recent half-hour talk on 'heterodox' economics, and   he has suggested in a single well-wrought paragraph that his main disagreement with the "Occupy Harvard" group is pedagogical.

Line of Best Fit

Some thoughts about philosophy and the special sciences. I put these thoughts together recently in an email to a friend, and liked the result so much I will reproduce it here.

In the task of building an over-all view of the world (which we might call, using the word loosely, the task of philosophy) one is perhaps drawing a line of best fit through points represented by all the fields of special study, including those of the sciences.

The expression "line of best fit" comes from statistics. Think of just two variables, to make things easy to plot on a piece of paper. Say, the relationship between grams of fat and total calories in an item of fast food. You could make fat grams the X axis and total calories the Y axis. Then represent each examined sort of fast food as a point on that graph defined by the two axes. a hamburger, a cheeseburger, a box of french fries, an ice cream cone without sprinkles, an ice cream cone with sprinkles, etc. Each gets just one point, defined by specialists.

Odds are good your graph won't result in any neat line. This is a "scattershot graph." But there will likely be a general common trend, that the points move diagonally upward and ouward -- i.e. fat correlates roughly with calories. So you produce a straight line summing up the data as best you can, keeping the variance between your line and the data points as small as possible.

That is the relation between philosophy and special studies of all sorts I have in mind. Of courtse, the results of the special sciences keep changing, as you may have noticed in terms of the news from CERN for example. So we might think of subatomic physics as it exists circa 2011 as one of the data points in our scattershot graph. If my philosophy is sound, over time the dots that are furthest out from my line of best fit will move toward it, not away. I need not pretend that all known points fit perfectly along my line -- if I make that claim, I'm surely delusional.

This idea of a line of best fit, though, captures well what Jacques Barzun is doing in Darwin, Marx, Wagner, when he argues with Darwin, and with contemporary biology insofar as it continues to reflect those aspects of Darwinism that stray furthest from the line he draws.

His own special science, the field where Barzun first made his initial scholarly reputation, is the history of music in the 19th century.

In the book I've mentioned, that reputation is of course of value. Barzun starts with the observation that three important events, in three distinct fields, took place in 1859. Darwin completed the ms of The Origin if Species, Marx published Contribution to the Critique of Political Economy (something of an early sketch of the as yet unpublished On Capital) and Wagner completed work on Tristan und Isolde.

I would be loath to argue with Barzun about Wagnerian music and its historic significance. He owns that particular point on the graph. As for the other two -- he is doing the best he can to make a line that fits the points, as we all are in our own ways.

His view, in a few words, is that 1859 was a disaster. Wagner moved music away from the wonderful avenues of exploration Beethoven had opened up and that such romantics as Berlioz had further explored. Marx mis-directed social reform into a materialistic/mechanistic direction, subverting the work of Saint-Simon, Proudhon, etc.

And Charles Darwin? Barzun prefers the insights of his grandfather, Erasmus Darwin. As it happens, Erasmus even wrote about the evolutionary significance of the opposable thumb, though he chose to do it in verse:

The hand, first gift of heaven! to man belongs;

Untipt with claws the circling fingers close,

With rival points the bending thunbs oppose...."

Waters v. Maloney

Fascinating stuff.  I'll just link to it.

Maloney 

I can tell you that from the point of view of an understanding of essential financial realities, Carolyn Maloney is vastly to be preferred to Maxine Waters.

 Indeed, I'm personally delighted that some of the interest groups pressing for more regulation of the financial world (such as New York's Working Families Party) have blasted Maloney for "siding with  Wall Street lobbyists and Tea Party conservatives by co-sponsoring a bill that undermines transparency.”

Transparency sounds like a good thing, but enforced transparency, like the enforced version of anything else, has its own costs. It is well that Maloney understands that, and certain that Waters does not.

A Simile

Leon Gettler, one of my FB friends, noted on his wall recently that he is compiling a list of his favorite similes. He gave as examples these:

"I lit a cigarette that tasted like a plumber's handkerchef." -- Raymond Chandler

"Let us go then you and I, when the evening is spread out against the sky, Like a patient etherizefd upon a table." -- T.S. Eliot.

I suggest that the following belongs on any such list: "in his blue gardens men and girls came and went like moths among the whisperings."

That is F. Scott Fitzgerald writing about Gatsby's parties. He doesn't write, "like moths to a flame," as any hack might. He expects his readers to throw in the flame, and he substitutes the whisperings for it, mingling one simile intimately with one metaphor.

Nanotechnology

SUNY at Albany hosts the College of Nanoscale Science and Engineering, a center, perhaps the center, of nano tech research in the US today. It has collaborative arrangements with 250 companies at work in the field, including IBM, Toshiba, Samsung, Novellus Systems, TI, and DuPont, just for starters.

The October 2011 issue of ENTREPRENEUR MAGAZINE credits Alain Kaloyeras, whose many titles include that of Chief Executive of aforesaid College. The magazine portrays him as the academic entrepreneur who built this program, and tells us a bit about how he has done it, a story that beings in 1988, when he was a "newly minted Ph.D. in condensed matter physics," and had to decide wherther to take a jub with SUNY, at that time not an impressive physics-and-engineering place.

(Jason Daley gets the byline on the story, part of a broader feature called Gurus & Grads. )

Here is Kaloyeras' page, at www.albany.edu

Although I'm hopelessly out of my depth in matters of high science, this has never stopped me from expressing opinions,as you can see here, for example, or here, or here, where I linked nanotechnology to my own personal "cosmological heresy."

It is possible that sentient beings play a part in the big picture of the cosmos.  Consider these points:

1) the great advantage of the Big Bang theory over any effort to revive the Steady State theory is that the former seems directly consistent with the 2d law of thermodynamics.  Everything has to be running down to a heat death, and the Big Bang and consequent expansion gives us a vivid mechanism for this.

2) Maxwell, in his thought experimemt of a little demon that redirects molecules, was hypothesizing a way to beat the Second Law.

3) Nanotechnology sounds a lot like the creation of Maxwellian demons as a reality.

Roger's Version

If you have on your personal bucket list the thought that you should read one novel by John Updike before you die, what one should that be?

The Rabbit series is over-rated.

The best single Updike, in my opinion, is Roger's Version.

Amazon's "most helpful" review, by someone calling himself "Outside Looking In," captures a nice moment from the book. The protagonist, Roger Lambert, is thinking about ancient Jews and contemporary Protestants.

"How did those Israelites get their hooks into us so deeply, sticking us with their frightful black Bible and it imprecations while their modern descendants treat the matter as a family joke, filling their own lives with violin music and clear-eyed, Godless science? L'Chaim! Compared with the Jews we protestants do indeed dwell in the valley of death."

In essence, Lambert is a Barthian. His "rascally pet" as he says at one point, is the great Swiss Reformed theologian Karl Barth (1886-1968). What he most admires in Barth is the utter Otherness of Barth's God, the rejection of even an "analogic" relationship between God's Being and our own being. God is essentially a hidden God.

Updike pits this Barthianism against the seemingly more naive views of a younger man,  Dale, who believes that contemporary physics is making God visible, and who believes he can complete that uncovering of God through computer science.

Lambert helps Dale get the grant for his project, but in subtler ways undermines both that project and Dale's faith.

As to the reviewers, David Wisehart thinks the book "both fascinating and frustrating."

David Lodge, writing in The New York Times, speaks of its "richness and viruosity," and says he finished it with "renewed respect for one of the most intelligent and resourceful of contemporary novelists."

Mark Athitakis, writing for Critical Mass, admires the way Updike "smoothly embeds dense scientific discussion into his narrative, anticipating the controversy over Intelligent Design more than a decade before it became a mainstream issue."

Not everyone liked it, though.  In The New York Review of Books, Frederick Crews spoke of "the growth of a belligerent, almost hysterical callousness" in Updike's career generally, which he sees as epitomized here.

I don't see what Crews thinks he sees.

Jacques Barzun

A belated happy birthday to Jacques Barzun. He came into this world on November 30, 1907, so on Wednesday of this week he reached the distinguished age of 104.

I was honored to attend his centennial celebrations four years ago, and was never before or since in a room with such distinguished company.

Rafe Champion has written a fitting brief celebration of Barzun's work, here.

I enjoyed especially Champion's quoting from an interview Barzun gave to a reporter from the Austin Chronicle.  The reporter remarked that Barzun had been in close working academic relationships with a lot of Marxists during the 1930s, but had never shown any enthusiasm for Marxism himself, nor had he ever taken up arms against it, identifying himself as an anti-Marxist.  The exchange runs thus:

Barzun: I had no Marxist colouring, such as they had ... I stood aloof, although not hostile, and I take it they weren’t hostile to me. They deplored my blindness.

AC: You started writing about Romanticism when that was not very popular. It’s funny, you were aloof from Marxism, but also from the reaction to it, which was influenced so much by T.S. Eliot.

Barzun: Yes, I was always against the current. Eliot of course got it from Babbitt, who got it from the French eminences of anti-Romanticism. What I read about Romanticism didn’t agree with what was said about it. Everything in the books was contrary to fact and legitimate conclusions of fact. Including all sorts of fabrications, simply lies that had gotten into the critical stream and were reproduced over and over again without being checked.

AC: You seem temperamentally more comfortable being at the limit of the Zeitgeist than being in the center of things.

Barzun: Well, I would call that the historian’s detachment.

  My own sense of Barzun's politics is that he has a fondness for various pre-Marxist sorts of socialism (what Marxists call the "utopian" sorts) and that he blames Marxism and its materialistic emphasis for having cut short that promising line of thought. Likewise with contemporary biology. He identifies with pre-Darwinian notions of evolution and, here too, sees Darwinian notions as too mechanistic and a threat to more vital conceptions of life.

Anyway, if I'm right to think of Barzun as a sort of Proudhonist politically, it explains how he has admirers of both right and left.  When his writings touch on politics, there is the air of an emigrant's nostalgia that appeals to the right, but the Proudhonist idealism comes through and appeals more to the left.

Acknowledgements

I'm getting close to the publication of my book, Gambling with Borrowed Chips.

I recently composed an acknowledgements page.  Since that also makes for sort of a neat little bio, I'll include it here.

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Acknowledgements

I’ve dedicated this book to Hans Schroeder, because it was through my involvement with his baby, The Pragmatist, that I first became part of the discussion of the great public issues of most concern to me. That magazine, the result of collaboration between Schroeder and estimable Jorge Amador, was dedicated to the proposition that liberty works, in concrete and demonstrable ways, and that coercion fails. The way to advance the cause of liberty, then, is to explain how and why it works. That simple insight has carried me forward ever since.

I’d like to thank Lee Miringoff, of Marist College, Poughkeepsie, New York, who gave me some practical experience polling, back in the late 1970s, at the start of what has since become the Marist Institute for Public Opinion.

I thank Myrna Gans, Steve Leo, and Susan Glass. I retain my memories of their comradeship in a suite of law offices in Bridgeport, CT in the 1980s as among my few pleasant memories of what was, for me, an unhappy experiment.

I thank Robert Katz, also a friend in that place and time, for doing his best to turn me into a practical politician, hopeless though that cause proved to be.  

I thank Associate Justice Clarence Thomas for citing an article of mine in his concurring opinion in 44 Liquormart v. Rhode Island (1996). It was a signal honor and, as a result, I have since flattered myself that I played a small role expanding the scope of first amendment protections. I also thank whatever clerk drew that article to Justice Thomas’ attention.

I thank Henry Cohen, who encouraged and advised me in the course of writing that article and many others over many years.  

I’d also like to acknowledge Kristin Fox, Johann Wong, and everybody who did the heavy lifting to bring HedgeWorld into existence as the Clinton years came to an end. Because of their efforts, I had the opportunity to cover and learn about the issues that I discuss in this book in greater depth than would have been possible by any other route – and to do so while pulling down a salary and calling my discoveries work.

Thanks are due to the great figures of the econoblogosphere, the loners sitting at their keyboards in their pajamas who have created a cyberspatial haven for intense debate over how markets work. I have in mind especially the late Greg Newton, of “Naked Shorts,” who was able to scan a 280 page court filing on the demise of the Plus Funds and find the one newsy nugget.

Gary Weiss, Roddy Boyd, Tracy Coenen, have all made their marks on my understanding of these issues and on this book, as has that discreditable felon, Sam Antar.  

I thank Christopher Holt for founding AllAboutAlpha, and Kristin Fox – yes, the same one thanked above! – for carrying on as the AlphaFemale there.

I thank Rosalie Schultz for a long and stimulating correspondence. I am sorry that I let it lapse, and hope she forgives me that. 

I thank Cicily for much, but in particular for suffering with me through Oliver Stone’s second “Wall Street” movie, a crucial moment of inspiration.

Other debts will become obvious within the body of the text. Still others probably won’t. But all those to whom I owe debts know who they are, and to all: Thank you.

Oh, and if it isn’t obvious: No one mentioned above should be held responsible in any way for the opinions or the blatant mistakes of what follows. 

Bradycardia

In a recent episode of House, a patient was diagnosed with bradycardia. If you're like me, you suspect that bradycardia is that disease that was first diagnosed in either Marcia or Greg, the older sister and brother respectively of the Brady Bunch.

Apparently, though, bradycardia and the Bradys are unrelated. The medical term refers simply to a too-slow heart rate.

Okay, I just wanted to throw that dumb pun out there.  Other than that, I got nuttin'.

Google News: Blast from the past

On October 2, 1941, the Montreal Gazette ran a story with the headline, "Religion Guarantees Worthless in Soviet Constitution, Foes Say."

Hitler had only recently attacked his erstwhile eastern allies, and now the western powers, including the whole of the British Commonwealth, and thus of course including Canada, were trying to make the mental adjustment required to think of Soviet Russia as an ally.  That headline, I submit, reflects the struggles of that moment.

Here's the lead: "WASHINGTON, October 1. -- President Roosevelt's action in calling attention to the Russian Constitution's guarantee of freedom of religion brought replies today that the guarantee meant nothing."

That's why old newspapers are cool.  They strip away our own hindsight, and help put us into the world of, say, October 1941.

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"With Held" is two words now?

From my email inbox.

Dear Friend,

I know that this short memo would certainly come to you as a surprise due to the fact that we haven’t had any previous correspondence with each other. In spite of this, I will appreciate it if you will permit me to inform you of my desire to execute a business with you which will certainly be of a mutual benefit to both of us.

I am Dr Mathew Bertin, accountant by profession. I work as an external auditor with my Bank and i discovered an Account that had been dormant for the past seven years.The account belong to a single holder (NAME WITH HELD).I am seeking your assistance at your willing so that we can do this financial transaction together so that you can claim this Funds through your foreign account. You have the absolute right to claim the fund hence you are a foreigner. If you know that you can handle such transaction, get back to me with your ideas alongside with your Direct Contact Phone Number for urgent and more discussion.

Best Regards.
Mathew Bertin

--------------------------- 
Um.  No thanks Matt.  And "withheld" should be one word.

The Democratic Party's Nominating Convention: 1896

Once in awhile I give you, dear reader, the dubious benefit of a brief random quotation from my recent reading.  That will be the case today.

I take this from THE TRAGEDY OF WILLIAM JENNINGS BRYAN, by Gerard N. Magliocca.

The leading obstacle to Bryan's nomination came from 'Gold Democrats,' who backed President Cleveland's policies, but they soon realized that they were outnumbered.  The president opposed Bryan's candidacy and told his supporters that 'a cause worth fighting for is worth fighting for to the end.'  Neverthelss, by 1896, Cleveland did not have much influence with the party faithful.  A Gold Democrat describing the scene in Chicago said that for 'the first time, I can undersand the scenes of the French Revolution.'  The conservative senator David Hill of New York, in a desperate plea to the delegates, said: 'I am a Democrat, but not a revolutionist.  My mission here today is to unite, not to divide -- to build up, not to destroy.'

Thanksgiving

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 for some of us constitutes chiefly the center of the football season -- its culmination for high schools, and a good time for the college games that serve as the natural lead-in to the wonders of the bowl-game season. Have you ever noticed, after all, how much a turkey looks like a football?

Last year at this time (and the year before) I was expressing my own gratitude to the fates for bringing Coach Edsall to the helm of the football program of the University of Connecticut. This year, that might not seem apt, since Edsall is no longer there. Just after the end of last year's (glorious!) season, which brought the Huskies to the Fiesta Bowl,  he left for what he called his "dream job," coaching the Maryland Terrapins.  I don't begrudge him upward mobility, but the I have to say I thought the manner of the announcement unnecessarily harsh.

Also, alas, UConn isn't haven't the kind of outstanding season to which I was reacting last year.

Still, think good thoughts!  Though the Huskies lost last weekend to the Louisville Cardinals, 34 to 20, QB Johnny McEntee threw for 253 yards and redshirt freshman Lyle McCombs (of Staten Island, New York) became only the second UConn freshman ever to pass the 1,000 yard mark rushing in a season.

So: good effort guys. And, by the way, Edsall isn't exactly going gangbusters at his new job. Wake Forest just administered a shellacking to them. Edsall's old team has a better record than his new team for the season. Good luck to Coach Paul Pasqualoni, and may he and this team prosper in years to come.

This coming Saturday, UConn plays the Rutgers Scarlett Knights. The Knights' roster includes their sophomore phenom Jawan Jamison and junior wide receiver Mohamed Sanu. Tough opposition, and it would be a worthy notch on the bedpost for UConn to pull out a W there.

The kickoff is set for noon at Rentschler Field, and the game may be covered by ESPN2. If it is, I'll be grateful.

Who Is Ellen Brown?

Ellen Brown is the author of "Web of Debt," a book about the U.S. monetary system, published in March 2010.

She has only come to my attention quite recently, though.  Apparently, she has both a following within the Tea Party movement and powerful detractors therein. This is intriguing: we need more people who break through the old predictable lines, both where they are right and where they are wrong.

Gary North, of the Specific Answers blog, is clearly among her detractors. 

If I understand the polemical situation rightly, it is this: the Tea Party rank and file is ticked off about the Federal Reserve. They largely (and rightly IMHO) see it as responsible for our screwed-up banking system and, by extension, for our screwed-up economy.

Both Brown and North agree with that.  The problem is this: Brown seems to believe that the big problem with the Federal Reserve is that it is unaccountable, i.e. anti-democratic.  A centrally controlled monetary system that was accountable to the democratic process would be a vast improvement.

North, on the other hand, contends that the problem with the Federal Reserve is simply that it is a central bank. It should not exist because central banks should not exist. The particulars of how it is run don't matter to him and, in his view, should not matter to the grass roots of any populist movement worth supporting.

Accordingly, Brown favorably cited a German researcher who said that interest now composes 40 percent odf the cost of everything one buys at a store. "If the government owned the banks, it could keep the interest and get these projects at half price."

I'll be keeping my eye on Ellen and on the disputes she seems to excite.

La Quinta

I spent two nights at La Quinta hotel in Stamford, CT last week: Thursday into Friday, and Friday into Saturday. 

I use La Quinta fairly often for my NYC jaunts -- its easier than trying to make the trip down from north of Hartford, take care of your business, and come back all in one day. This time, I stretched that much action out over three days and two nights making a mini-vacation of it.

One thing I like about La Quinta is that each room has a real honest-to-goodness wardrobe, instead of a built-in closet.  A real porthole-to-Narnia wardrobe.  Haven't found my way through the back yet, though.

One thing that annoys me is that they haven't figured out that I'm a repeat customer. I'm supposed to get some sort of discount for being a repeat customer, but there must be some period of time, after the passage of which, my earlier visit drops out of their system.  I must not be sufficiently frequent in my trips there.

Ah well.  In the middle of this life we're bound upon....

Jonestown

This is the 33th anniversary of the mass suicide at Jonestown, Guyana, of the People's Temple cult.

Give the victims of that masacre a few moments of your thoughts today.

The massacre gave the world the expression, "Don't drink the Kool-Aid."

As it happens, it wasn't really poison-laced Kool-Aid that they were drinking.  It was poison laced Flavor-Aid, described here as a knock-off product.

I'm sure this has been driving the real Kool-Aid's marketing folk to distraction for decades now.

Fracking: Some Links

I'm just going to link farm today.  Subject, fracking, the propagation of fractures in layers of rock in order to draw through the rock the buried petroleum, natural gas, or other valuable stuff.

According to Schlumberger's oilfield glossary, "engineered fluids are pumped at high pressure and rate into the reservoir interval to be treated, causing a vertical fracture to open." Who is Schlumberger?  The "leading oil field services provider," according to the company webpage.

Some residents in Oklahoma reportedly suspect that recent seismic activity there owes something to the practice, but this article in The Christian Science Monitor takes a skeptical view.

Fracking is a more likely culprit for small earthquakes near Blackpool in England recently though.

Earthquakes aside, the usual complaint against fracking involves the potential for water pollution.

The Oil and Gas Accountability Project says bluntly that "our drinking water [is] at risk" due to the practice.

The OGAP cites a white paper prepared by the U.S. Department of Energy's Argonne National Laboratory which described "produced water," i.e. the waste products.  "The many chemical constituents found in produced water, when present either individually or collectively in high concentrations, can present a threat to aquatic life when they are discharged or to crops when the water is used for irrigation."

Joseph Nocera is among those who defends the practice of fracking. He said America "needs the Marcellus Shale," which has 500 trillion cubic feet of reserves, so that we ought to "accept the inconvenience that the drilling will bring" and insist that the drilling be done in ways that address the environmental issues.

There is a spirited discussion in the comments under this post in The Volokh Conspiracy.

Novelization of the Lodz Ghetto II

This will continue and complete the observations I made on October 30,  concerning the novel EMPEROR OF LIES by Sem-Sandburg.

There's a nice touch near the end, as the novelist wants to inform us that the Russian front is getting closer to Lodz. He writes, "Rosa Smolenska could feel the detonations of distantly falling bombs, dull tremors through the walls of the house and up through her own body."

I like that because it seems to be paradoxical, and because in its paradoxical way it states the precise nature of these detonbations as felt by the ghetto inhabitants. They are still "distant" and "dull," yet not so distant nor so dull that they fail to pass as a tremor through one's whole body.

Just a bit later, we get what some might call unnecessary detail about the sort of war related manufacture still taking place in the ghetto.  "Debora worked right at the end of the cold, crowded shed, where she and some other girls stood packing the finished fuses in little square boxes made of card." "Card" sounds like an awkward translation that might better have been "cardboard," but the detail work continues in the next sentence. "Twelve plugs to a box, and then the flaps and the top and bottom of the boxes had rto be tucked into the little diagonal slots on their sides."

Ron Paul Got This Exactly Right

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Two key paragraphs:

The Fed fails to grasp that an interest rate is a price—the price of time—and that attempting to manipulate that price is as destructive as any other government price control. It fails to see that the price of housing was artificially inflated through the Fed's monetary pumping during the early 2000s, and that the only way to restore soundness to the housing sector is to allow prices to return to sustainable market levels. Instead, the Fed's actions have had one aim—to keep prices elevated at bubble levels—thus ensuring that bad debt remains on the books and failing firms remain in business, albatrosses around the market's neck.

The Fed's quantitative easing programs increased the national debt by trillions of dollars. The debt is now so large that if the central bank begins to move away from its zero interest-rate policy, the rise in interest rates will result in the U.S. government having to pay hundreds of billions of dollars in additional interest on the national debt each year. Thus there is significant political pressure being placed on the Fed to keep interest rates low. The Fed has painted itself so far into a corner now that even if it wanted to raise interest rates, as a practical matter it might not be able to do so. But it will do something, we know, because the pressure to "just do something" often outweighs all other considerations.

I should add (since I used the word "exactly" in this entry's headline), that I do have one small nit to pick with the way Paul expresses himself here. Not with the substance of his exposition, which is perfect, but with the jots and tittles.

He defines interest rates briefly as "the price of time." They aren't the price of time. They are defined and measured by time, just as apartment rents are defined and measured by weeks, months, or years. But a rent isn't the price of time, it is the price of occupancy. Likewise, an interest rate is the price of credit, or of the use of the principal, for a specified period of time.

What Paul means is clear enough, and his brief use of the phrase "the price of time" probably does no harm, except ... that in the days of Savonarola and in the glare of Scholasticism one of the most common objections to the charging of interest, one of the reasons given for considering all interest as the sin of usury, was this notion that it is selling time and that time is of God. I would rather not have free-market advocates play into those bad old superstitions, or we'll end up throwing our vanities into a bonfire.

Still, Paul is making sound points. The Fed isn't wrong because of this chairman or that chairman. It isn't wrong in ways that new appointments or some tweaking of the mandating statutes could fix. It is wrong because it is a central bank, and what central banks do is in essence wrong. They are central planners, just as those who would run the auto industry from Washington (and who, these days, essentially do) are central planners.

The point should be not to improve the Fed but to close it down.

In this, perhaps, tea partiers and OWS types can come together.

Howrey Collapse

Howrey LLP, a once very prominent global law firm that has been around since July 1956, declared bankruptcy earlier this year after the collapse of merger talks with Winston & Strawn, and is still in the process of dissolution.

It is good to see that in the field of the law at least, even the biggest firms are still considered small enough to fail.

It isn't difficult to imagine a situation in which high government offiucials run around wringing their hands about what a disaster the failure of such a multi-national well connected form will be, and asking each other what can be done to save it.

Anyway, for those interested in a proper RIP: the firm is named after  Jack Howrey, who chaired the Federal Trade Commission in the early Eisenhower years.  His first partners were Bill Simon, Hal Baker, and Dave Murchison, and the firm's first focus was on antitrust law. Early on it became associated with the cereal industry, which has long had to fight antitrust battles. 

As it grew, though, it developed other areas of focus, especially in intellectual-property law. The leading light of the firm's Amsterdam office, Willem Hoyng, is the author of a highly regarded textbook on Dutch IP law. 

So they pass into history with a hardy "Cheers!" from me, and best wishes to all the displaced partners (who seem to have long since written lucrative tickets for themselves elsewhere) and the bankruptcy law trustee who has to sort it all out.

Cuban Perestroika?

Well ... baby steps.

Relenting on car sales

Looking Inside

Anderson Brown has a fascinating post on the "mereological fallacy" and its significance for the philosophy of mind.

I'll just link to it and allow you to find my further comment on it there.

"Points of light"

I've just been skimming, for no especially good reason, through a conspiratorialist book written in the late 1980s.

You may remember the late 1980s. The elder Bush in the White House. 

Conspiracy theorists of course typically seize on whatever is in the headlines and spin it into a freemason plot or whatever.  When those things drop out of the headlines, these writings can become dated quickly. 

Thus, the conspiracy book in qustion diud what it could with the expression "a thousand points of light" used by George H.W. Bush in his campaign in 1988.  Aha!  similar expressions were used by Masons and Illuminati and so forth.  It's all part of the "New Age New World Order"!

Yes, except, a "point of light" is a quite common expression, likely to have occurred to anyone who has ever looked at the night sky. Not evidence of any link except that we all do live under the night sky.

Phony pointless expressions of erudition don't make for understanding.  Oops, I just used the word "point" as a metaphor didn't I?  I guess the jig is up.

Nor'eastern

Now THAT was nasty!

I don't remember a power outage in leafy suburban Enfield lasting as long as did the one initiated by the freak pre-Halloween wintry storm this year.

Don't really want to see another one. 

Indeed, the situation reminds me of the famous poem about a purple cow.

Clint Eastwood on Gay Marriage

These people who are making a big deal out of gay marriage?  I don't give a fuck about who wants to get married to anybody else. We're making a big deal out of things we shouldn't be making a big deal out of.  They go on and on with all this bullshit about "sanctity." Don't give me that sanctity crap! Just give everybody the chance to have the life they want.

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Thanks Clint.  The next time somebody tries to stop gay people from marrying, ask them whether they think you've still got a bullet in your gun.

"In all this excitement, I've lost track myself...."

Novelization of the Lodz Ghetto

I've been reading THE EMPEROR OF LIES, Sem-Sandberg's novelization of the Lodz ghetto, and Rumkowski's tenure there as the Nazi-approved "Eldest of the Jews."  Here's a review of the book from The Guardian.

It is, as you might expect, a depressing read. Yet in its way compelling. 

I wonder about the following passage.  Does the character "Zawadzki the smuggler" represent anybody historic?

"When the Germans heard that the Jews had caught Zawadzki themselves, they rang for a car from the centre of Litzmannstadt.  The Jewish officers realised this was the end for Zawadzki and asked him if he had a final request. He replied that he wished to go to the toilet. Two policemen escorted Zawadzki to the latrines out in the yard.  They handcuffed Zawadzki to the latrine door and then stood guard outside, keeping a careful watch on the shoes clearly visible beneath the locked door. The policemen stood staring at Zawadzki's shoes for a good hour.  Then one of them plucked up the courage to break down the door.  The shoes were still there, and the handcuffs, but no Zawadzki."  

Hominid Hunting

This looks like a great new site, although new and still evolving.

http://blogs.smithsonianmag.com/hominids/

All the Devils: Two Points

I have written before in this blog about the McLean/Nocera book, ALL THE DEVILS ARE HERE.

It is a fine book, and I continue to re-read bits of it and discover new points.

Two quick ones today.

1) In their chapter 13, "The Wrap," the authors discuss AIG-FP, the financial products division of the vast insurance company AIG, and its contribution to the crisis. They introduce us to a fellow named Al Frost, who marketed credit default swaps (CDS) for AIG-FP.

After making this introduction, they mention that various CDS' held by AIG-FP included collateral triggers, i.e. contract clauses that allowed "counterparties to demand that AIG put up ... cold, hard cash -- if certain events took place."

Then there is this masterpiece of concision, in which Frost is allowed to hang himself.

"It is hard to know for sure if these triggers were there from the start. Frost ran his department like a little fiefdom; he tended to impart information on a need-to-know basis. (Through his attorney, Frost denies that he didn't talk freely about what was going on in his business.)"

Am I the only one who has chuckled at that?

2)  Also in chapter 13, the authors briefly mention Gary Gorton, a Yale economist hired by AIG-FP to develop their risk models.  His models obligingly told the division what everyone there wanted to hear, that the triggers weren't at all risky.

Gorton is mentioned again, much later, in chapter 16, about Treasury Secretary Hank Paulson.  "Yale economist Gary Gorton -- the game man who did risk modeling for AIG-FP -- explains the repo market this way...."

That wasn't a typo.  Or at least it wasn't my typo. They don't write that this is the "same man" mentioned earlier.  He is the "game man."   I imagine him telling his AIG-FP acquaintances: "Yes, I'll create a model that suits your desired conclusions.  I'm game!"

I suspect this isn't their typo either, that it is a deliberate play on the two words.  But hey, what do I know?  I'm just the game man who keeps reading their book.

Nazerali v. Deep Capture

A Canadian stock promotor, Altaf Nazerali, has filed a notice of claim against the website Deepcapture.com and its operators, contending that the site has falsely characterized him as a con artist.

You can access the notice of claim on Scribd: here.

The Supreme Court of British Columbia has issued a court order shutting the site down, which is why you get a blank screen if you try to go here: www.deepcapture.com

Stockwatch quotes the complaint quoting the website saying that Nazerali is affiliated with "an impressive number of securities traders who are also narco-traffickers (such as Paul Combs, until Combs was whacked by Nazerali's mobster friend Egor Chernov)" and that he has "working relationships with ... members of Al Qaeda's Golden Chain, the regime in Iran, Pakistan's ISI, the chief of Saudi intelligence, the ruler of Dubai, the royals of Abu Dhabi, La Cosa Nostra, the Russian Mafia, and others in the Milken network."

I first learned of this from Gary Weiss' blog. Weiss is especially interested in the (intimate) relationship between Deep Capture and Overstock,com, nowadays also known as O.co, and Overstock boss Patrick Byrne.

Regular readers of Pragmatism Refreshed might recall that to Byrne the phrase "the Milken network" in the above quotation has a special resonance. Ex-con Michael Milken, is one-half of the collective Sith Lord (the other half is Steven Cohen). This Sith Lord -- a term of course taken from the Star Wars movies -- is at the center of a vast worldwide web of corruption -- perhaps the web of corruption, since there hardly seems to be anything wrong with the world in recent decades that doesn't get introduced into Deep Capture's theories.

Anyway, Deep Capture has apparently assigned Nazerali a key role in this same awesome/awful network linking (as Weiss puts it) "every crime since Jack the Ripper."

Nazerali has named as defendants not only Deep Capture LLC and Byrne, but High Plains Investments LLC, GoDaddy Inc., (the site's registrar), NoZone Inc. (its host), Google Inc., Google's Canadian subsidiary, and Illinois resident Mark Mitchell.

Let's pause on Mitchell, described in the court filing as the principal author of the defamatory articles.  This is the first time I've mentioned him on Pragmatism Refreshed. He was once the assistant managing editor of CJR Daily, a web outlet of the Columbia Journalism Review.  During his tenure, the CJR was often accused of ... well ... just missing the point when it touched upon finance journalism. Missing various points.  Among those making that case was Joseph Weisenthal of The Stalwart.

Under his watch, too, Gal Beckerman penned an incomprehensible complaint about a perfectly routine WSJ story about nervousness among some Berkshire Hathaway stockholders, and Mitchell came riding to the defense of that complaint, without in the process making it any more comprehensible.

By the end of Mitchell's time there the CJR Daily had essentially given up on tracking finance journalism. Yet he had the name and reputation that came from his time there and he was, excuse the expression, a big capture for Deep Capture, when he started writing for them, apparently some time in 2008.

I'm just trying to keep all the players straight here.

Meanwhile, a commenter on Weiss' blog suggests that "Mr. Nazerali took umbrage with journalists in the past (NY Post and some Canadian paper). 2 reporters named Christopher Byron and Lee Webb did a story on a firm Mr. Nazerali was associated with over 10 years ago," and Deep Capture has just recycled this.

It will be fascinating watching how this plays out in the courts of the Great White North.

The Abacus and the Cross

I've recently received via a book club membership, "The Abacus and the Cross," a book about the life of Pope Sylvester II. He held that august title from 999 until his death in 1003: he was Pope, in other words, when the odometer of the Anno Domino calender first flipped over, back before anyone worried about a "Y1k" bug that would ruin the network of abacuses.

Before 999, the future Pope was known as Gerbert of Aurillac, and the author of this book, Nancy Marie Brown, makes a case for Gerbert as a note-worthy scholar and (to use an anachronistic term) a scientist. 

Brown has built her own reputation as a popularizer of science. Her best known book before this one was "Mendel in the Kitchen," a discussion of genetically modified foods, which she co-authored with geneticist Nina Fedoroff.

Here she seems to have an apologetic intent. She wants to be sure we know that the 10th century Europeans did not believe in a flat earth, were not terrified of the arrival of the year 1000, didn't argue over angels dancing on the heads of pins, and were quite interested in the advance of science. Indeed, among the achievements of Gerbert she chronicles is this: he became curious about how organ pipes behave acoustically, so he built and tested models and devised an equation to match the results. In a word, he experimented.

But sometimes her apologetic designs get in the way of her story.  She tells of us one debate between Gerbert and an ecclesiastical rival over whether physics should be taught in universities as a subdivision of mathematics, or as a separate field. She doesn't want us to think that this is a silly subject, since "Professors today hold the same debates: Twenty-first century academics are at odds over whether archeology is a type of history or should be taught as a science."

Well, yes, but it is rather silly when it happens in the 21st century too.  Those debates are mostly about turf. The history department is larger if the archeologists are included therein than if it isn't, and the head of the history department of that university will surely want to include them.  The rest of us should be uninterested in their turf wars except, perhaps, as a matter of ... well ... a specialized sort of anthropology.

As to Gerbert's debate with a fellow named Otric, it doesn't appear to have amounted to much pragmatically except amusement for some privileged observers.  You can of course treat physics under the heading of math if you want (Gerbert's experiments with organ pipes were aimed at finding the right equation, after all). You can treat them as separate though of course closely related disciplines if you want. Putting too much emphasis on which is the 'right' categorization is inane.

Not as inane as belief in a flat earth, but still inane.

Still Thinking About the Enron Anniversary

But for today I'll just offer you a link.

Kinder.

Oh, and the obvious pun: Will history be kind to Kinder?

Enron: Ten Years Ago

The drama of the Enron scandal was playing out in the day-to-day headlines of a decade ago this month.

It was on October 16, 2001, in particular, that Enron issued a dramatic series of announcements. It had a 3d quarter loss of $618 million. It took a $1.2 billion hit against shareholder equity related to the unwinding of a partnership that its Chief Financial Officer, Andrew Fastow, had been running on the side (LJM2). And it acknowledged an after-tax charge against earnings of $544 million ... again, related to LJM2.

On October 17th, the SEC sent Enron a letter.  Actually, three letters and three question marks: "WTF???"

On October 22, the existence of an SEC investigation became public knowledge and the price of shares of Enron fell 20 percent. 

On October 24, the board finally fired Fastow, replacing him with Jeffrey McMahon, who himself had been deeply involved with many of the very Fastowian transactions that were doing in the company. 

By October 29th it was obvious that Moodys was going to downgrade the company's credit status.  Ken Lay talked on the phone on that day with President Bush's Commerce Secretary, Donald Evans. Nobody in the administration lifted a finger for Enron -- and I am nobody's idea of a Bushie, but I have to say this was to their credit.

Anyway, all of that provided excitement to the October of 2001.  In this October we deal with different crises and the characters as they unfold have different names.  Yet "the more things change...."

Worst Reasoning ... Ever

The following has been circulating at Facebook.

"In the 1950s and 1960s when the top tax rate was 70 - 90%, we laid the interstate system, built the internet, put a man on the moon, defeated Communism, our education system was the envy of the world, our middle class was thriving, our economy unparalleled.

"You want that back?
"Raise taxes on the rich."

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

That might just be the most lame argument I've ever encountered.

Begin at the beginning: were the rich actually paying 70% or more during that period, or were they availing themselves of various loopholes and paying a good deal less?  My guess (subject to correction) would be that they probably weren't actually paying much more than they are now. 
This matters because the general 'point' is that good things happened at time X, and Y was true through the time X, so Y must be the cause of the good things in X. That is either valid for EVERY pertinent Y, given the EXACT Y involved, or it is not valid at all.

Thus, as to taxes, every loophole that existed for the avoidance of taxes by the wealthy during the period in question must be scrupulously preserved or restored in order for us to get back to the wonderful postulated good old days.  For the loopholes are all part of the Y, right? 

And there are other candidate Ys that had nothing to do with the tax system.  Those were the years of the Bretton Woods accords, after all, which lasted from 1944 until 1971. These accords created a gold standard with regard to international financing.  So maybe it was the gold that was behind all those good things!  (Indeed, personally I take this quite seriously, although I acknowledge that just daydreaming about good old days would not make up an argument for it.)

The 1950s and 1960s were also a period when neither the US nor the UN recognized the People's Republic of China. In both contexts, only the government in Taipai was China.  So ... withdraw recognition from Beijing!  and go back to spelling it Peking!  You want those good things "back," right?

But ... look at the list of "good things" again.  The US "defeated Communism" in the 1950s and 1960s?  Assuming that the word "Communism" in that sentence refers to the bloc of nations led by the old Soviet Union: didn't its "defeat" come after the reduction of the highest marginal taxes?  In the late '80s and early '90s?

What the US did in the 1950s and 1960s was "contain" Communism.  By, for example, making a point of committing to the defense of Quemoy and Matsu, the forward posts of the regime in Taipai that we continued to recognize as the only legitimate China.  So why should this lead us to the conclusion that we should replicate the tax system of the period without also replicating its diplomacy?  Rescind the recognition of Beijing!  (Or, recognize reality and don't do that -- but drop silly arguments.)

The US created the interstate system during the period.  Yes: but should we pay no attention now to the possibility that that is one of the causes of subsequent troubles?  After all, it made the rapid consumption of gasoline a lot more easy and a lot more tempting. That in time became a geostrategic imperative: we have to keep importing the crude oil that makes that possible in ever-increasing quantaties.  In the good old days, the best way to get to California was to take route 66.  It made for a nice TV show but unwieldy travel. You want those good old days back?  Tear up the interstates!

Does that sound silly?  Well, consider again where I got the idea for such an absurd conclusion!

Hosni Mubarak

Thirty years ago this week, Hosni Mubarak became the president of Egypt.  Specifically, he assumed the office on October 14, 1981, after the assassination of Anwar el Sadat.

Of course, Mubarak didn't quite make it this year to his 30th anniversary in office. He is on trial on charges of the murder of peaceful protestors during the "Arab spring."

Further, the new government of Egypt is looking into an accusation that Mubarak was complicit in Sadat's death. I don't know what to think about that accusation.  It might be akin to the various horrible crimes that were attributed to Richard III during the Tudor era. The worse Richard III came to look, hump-backed and all, the better were the Tudors for having delivered England from such a misfigured tyrant.

Nobel Prize in Economics

The Nobel Prize in Economics this year went to Thomas J. Sargent and Christopher A. Sims "for their empirical research on cause and effect in the macroeconomy."

A representative from "Nobel Media" spoke to each man soon after they learned of their award, and recorded the interview. I'll just quote a snippet of each here.

The rep said to Sargent, "It's quite a time to be chosen to be a Novel Laureate, with so much of the world's attention focused on the economy," and then asked, "Do you find it a daunting prospect to be the subject of so much media attention?"

Sargent replied: "Well, I ... sorry, I don't know what's involved in that. You know, we're just ... yeah, we're just bookish types that look at numbers and try to figure out what's going on. So, I don't know what to say to that!"

In the interview with Sims, the rep asked about the difference between the two new laureates and their approaches to getting at macroeconomic causality.

Sims said that Sargent's aproach "is to start with a model economy for the most part ... and then [he] tries to fit it to data and run his experients in it. I usually start with a statistical model of the data and then add economic assumptions sparingly until I can begin to get answers."

Carcium -- The Conflict Begins

The above headline is the title of a new book by Donald Calvanese, of Agawam Massachusetts.

For those of you who enjoy fantasy -- this book is, as its title hints -- designed as the first volume of a projected trilogy.

From the publisher;'s press release:

"Carcium - The Conflict Begins” begins with the story about Nina, a young naive ruler, who was one of the last to fall into the darkness. She was put to the test of worthiness by the mystical elves and had failed. Her kingdom and its people were enslaved. Now, all of the kingdoms of Phygeria are on the brink of destruction and have succumbed to evil - except for Carcium. For years, a great king ruled the Kingdom of Carcium in the land of Phygeria. Brave and just, the king protected Carcium from the evils of the outside world and within the kingdom. But when the brave king falls, the days of peace in Carcium fall with him. The king’s young son, Prince Troy, assumes the throne and the evil that has threatened Carcium for so long moves ever closer to the kingdom’s walls. Prince Troy must face the test of the elves which many rulers in the past have failed. He must also find the mystical sword - the only weapon that can destroy Duras Carcer, a demon who draws his life force from overthrown rulers and fallen kingdoms. As a force – will Troy, Brutus and Nina have the strength to save the Kingdom of Carcium? Do they have the wisdom and abilities to restore Carcium to its former glory and overcome the evil ways of Duras Carcer?

A shout-out and congrats to Mr. Calvanese.

Dorothy Sayers, Conclusion

Two weeks ago I quoted a passage from Dorothy Sayer's introduction to her translation of Dante's Divine Comedy. Click here to refresh your recollection. She listed some of the references drawn largely from British history of the late 19th and early 20th century that a British poet in the middle of the 20th century might use in creating an analog. Her point was that these references will become obscure over time, just as the various references of medival Italy now seem quite obscure to us.

The passage of time has proven her right in this.  In last week's entries, though, I found something to say about eachof the allusions -- except for those below.  Today we conclude our self-appointed task as annoator for Sayer's hypoithetical poem.

"the Officer in the Tower" -- Norman Baillie-Stewart (1909-1966), a Subaltern in the Seaforth Highlanders, who was court martialled in 1933 for selling military secrets to Germany. The two countries were not yet at war, so he was not in danger of execution for treason, but he did become the last British citizen ever imprisoned in the Tower of London, and earned the italicized nickname.

Peter the Painter --  the pseudonym of a Latvian Communist revolutionary, who was involved in street fighting in London (the "siege of Sydney Street") in 1910-11. His "real identity" is still a matter of some dispute, but it may well have been Yakov Peters (1886 - 1938).

Jenkins 'of the Ear', -- Robert Jenkins -- the birth and death dates are uncertain. He was captain of a commercial brig sailing the West Indies in 1731. His vessel was stopped and boarded by a Spanish ship, and his ear was severed.  The incident became the professed cause of a war between England and Spain.

Dick Sheppard (1880 - 1937), the Dean of Canterbury Cathedral from 1929 until illness forced him to retire two years later. Sheppard was was of the outstanding clerical pacifists of the inter-war period.

Jack Sheppard (1702-1724), a thief was was repeatedly arrested by, and who repeatedly escaped from, the authorities in 18th century London, making him a Robin-Hood type figure in the eyes of some.

'the Widow at Windsor' -- A phrase popularized by Rudyard Kipling for Queen Victoria (1819-1901). It refers of course to the period of her rule after the death of Prince Albert in 1861.

The writer of this hypothetical poem also "holds strong views on" the following issues, on each of which I'll say a very few words:

Trade Unionism -- nowadays we would probably speak of "labor unions," and "collective bargaining." The phrase "trade unions" with or without an "ism" seems antique.

the constitution of the UNO -- of course the United Nations' constitution was and continues to be a target of objection both by nationalists who believe it constrains the sovereignty of member nations and by full-blooded internationalists who complain that it doesn't.

the 'theology of crisis' -- a phrase associated especially with Karl Barth (1886-1968), emphasizing the utter Otherness of God, and thus His unknowability. Reliance on scripture doesn't remove this unknowability, for: "The Bible is God's Word so far as God lets it be His Word," Barth wrote.

Freudian psychology -- Sigmund Freud (1856 - 1939) hardly needs comment from me, except to say that his influence was at something of a peak in the post-war British context of Sayers' hypothetical poet.

Einsteinian astronomy -- refers of course to Albert Einstein (1879 - 1955) and the profound changes he introduced into how we think about Space, Time, Matter, and Energy.

and the art of Mr. Jacob Epstein (1880 - 1959), an influential sculptor, whose art includes for example "St. Michael's Victory Over the Devil," a work affixed to the wall of Coventry Cathedral.

A Guide to Dorothy Sayers IV

I've been conducting a review of the allusions that Dorothy Sayer introduced in her plan for a hypothetical poem. These are references drawn largely, though not entirely, from British history of the late 19th and early 20th century.  I'm not going to finish this up this week, but let's see how far we can get.

the Tolpuddle Martyrs, a group of farm workers who were convicted in 1834 for swearing an oath of solidarity to one another. The prosecution was part of the broader anti-union backlash of the day, and the convicts were transported to Australia.

Brown and Kennedy, Both of these names are of course quite common, and it isn't obvious who Sayers meant. My first suspicion was an American one -- she was linking the two men who separately defeated Richard Nixon's political aspirations in the early 1960s!  But Says seems to have completed this introduction by 1949. My present suspicion, since this item comes right after the Tolpuddle Martyrs, is that the reference is to James Brown (1862-1939), the head of the National Union of Scottish Mineworkers from 1917 to1936. Perhaps Sayers is coupling Brown with an American counterpart,  Thomas Kennedy (1887- 1963), an important figure in the United Mine Workers (in the US) from at least 1925 until his death. If anybody has a better idea for what this pairing means in this context, please let me know.

the Dean of St Patrick's, this is an allusion to Anglo-Irish novelist Jonathan Swift (1667-1745).  The St Patrick's in question is the Cathedral in Dublin.

the Dean of St Paul's, John Donne (1572 - 1631), the paradigmatic figure of what is nowadays called "metaphysical poetry." The author of the famous Meditation XVII, "And therefore never send to know for whom the bell tolls; It tolls for thee."

Dean Farrar, Frederic William Farrar (1831-1903), an advocate of "Christian universalism," the idea that all human souls will in the fullness of time be reconciled with God -- i.e. that there is no everlasting damnation of the sort Dante vividly imagined.

Fred Archer,  Frederic Archer (1838-1901) An organist and composer whose career began in England but continued after 1880 in the United States, where he became conductor of the Orotorio Society in Boston, Mass.

Mrs Dyer, Louise Berta Mosson Hanson-Dyer (1884 - 1962) -- Sayers helpfully groups two of her musical referents together here.  Mrs Dyer was an Australian born woman, who founded a music publishing operation, Éditions de l'Oiseau-Lyre, in 1932.

Lord George Sanger (1825-1911), an English analog to P.T. Barnum.  Sanger ran a variety of shows and circuses and founded an association to lobby for the intrerests of such businesses, the Van Dwellers Protection Association.

Lord George Gordon, (1751-1793), a Scottish nobleman who converted to Judaism in 1787, at 36 years of age. Charles Dickens makes a favorable allusion to George Gordon in the novel Barnaby Rudge.

General Gordon,  Major-General Charles George Gordon (1833-1885), best known for his determined defense of the Imperial position at Khartoum, in the face of the Mahdi rebellion, (Islamism, one might say) and his death in that defense in January 1885.

Ouida, The pen name of the novelist Maria Louise Ramé (1839-1908). Her works, considered racy at the time, were quite successful, but she did not manager her money wisely and died in poverty. Jack London cited her as an important influence on his own writing.

William Joyce, (1906-1946), known as Lord Haw-Haw, he was born in New York, but his family returned to his parents' home country, Ireland, while he was a child. They were Unionists in the Irish context, and they moved to England soon after Ireland received its independence. Joyce would found the British Union of Fascists and would broadcast radio propaganda for Hitler during the war. Hence his execution for treason in January 1946.

James Joyce, (1882-1941), one of the defining figures of literary modernism, perhaps best known fo Ulysses (1922).