Friday, April 10, 2015

Constructive look at economics III

Moral: Wherein we can the bile (Const I, Const II) and start over, albeit slowly.

No excuse, Sir (but, must have been recoiling from Ben's somber tone).

We all know of bullies. You know. some of the bullied turn out to be nerds. Some of the bullied turn out to be CEOs. But, are more CEOs of the bullying type than not?

Silly question? Depends upon your viewpoint, but, consider that it comes from decades of observation (and involvement - actually, at one point, I thought they were all idiots - immature - look closely at yourselves, CEOs and similar ilk, ever notice that babies exhibit the same behavior? - but, who is perfect?). One prominent guy is called a wizard (some seem to see that as sage-like).

For any, I like to bring in "near zero" (have since the beginning) which enlarges the scope (yes, the types that talk "big picture" have many limits to their view - how to bring this forward to their attention?).

Well, we have a major brain now saying that mankind needs (must have) compassion (in order to cope with the future - have one, in fact). Actually, I was happy to hear that (meaning, I do not know the specifics but have pondered some of the inconsistencies that lurk). What CEO has a compassionate bone that is not tied to money or fame or other types of self-interest?

Oh gosh, Did it, again? Well, that was the last of it. Let's be serious.

You see, at the core, we have issues that are age-old, extremely gnarly, and seemingly more troublesome in this day of technology (and STEM). So, what are we to do? Sit and ponder (well, some do take that route)?

Go out and grab (well, that is the jungle way, is it not?)?

Then, overlaying that swamp (all due respects to Mr. Wonderful and the shark mind) with technology brings things to a type of boil (yes, many connotations here) that is difficult to control. But, at the same time, technology is ridden with faults (oh, yes - is it hubris that keeps that from coming to general awareness?). Yet, given that a large set (still a small minority) reaps benefit. The larger set just endures and suffers.

But, compassion would make that apparent. Why does it not? Technology (STEM) also assigns a value of very little to those who do not fit into the mold (to be discussed). I know, how does one talk to a moron if one is of the ilk that conquers things like the SAT? Condescendingly, of course? Now, we can project, extrapolate and all sorts of other operations around that little bit.

In fact, part of the success of technology is that type of ability which maps well to the type of processing that computers can do. Talk about much "ado about nothing." We will have to lay out a careful explanation about this. Quasi issues are important. But, too, we have core and boundary specifics that come into play. I don't want to use "being" due to the bad associations that we saw from the mid-1900s in that regard.

We'll get back to that. But, for now, leave it that markets are exploitative, by nature. All of the machinations that Ben talks about (several variety, many dimensions) cannot do the trick. Even Janet talking the lack of ethics is not going to do it.

That is, what to do? Well, we can talk "near zero" for awhile. Any large accumulation (yes, Warren) comes from insufficient regard for true costs (what?). Ah, don't give me grief here, folks. There are so many examples of fat cat greed (and things like declining infrastructure) that the description could be fairly simple. Let's see if we can do that.

Remarks:  Modified: 04/10/2015

04/10/2015 --  With the tea ceremony, some felt that a spiritual basis could be established. That is, for the country (lot to discuss). What is the spiritual basis for the U.S.? For business? We have already seen animal spirits invoked (ala bulls, etc.). Given this early theme, mindfulness will come forth as something of importance, in this sense: running after money is not mindful (arguable point, indeed).





Wednesday, April 8, 2015

Constructive look at economics II

Moral: Wherein we continue a constructive approach, albeit slowly.

And, while we do so, the world runs on. But, we are not dabbling, real-time, in experimenting with people's lives and well-being, either. Ben cannot say that he was not a cowboy with his creative financing/monetary schemes. Too, Janet cannot say that she has not perpetuated the errors.

So, what is the basic problem here, folks? Well, academics are running the show when it comes to the FED. That would not be so bad if it were science, but we are talking a larger set of issues. Now, business management? Well, that domain has its set of problematics, too. How did this focus on the pseudo-quantitative come to fore?

Well, even since Nash (we'll get back to this) and the advent of computing (ubiquitously so), all hell has broken loose. Not that it was better before, since before then we had mostly the politicos and their warped views. Democracy? Have you noticed that things seemed to have descended to a state of having re-election as the focus for these elected ones?

So, who's watching the baby in the bathwater? Not the academics, folks. They're after papers and fame.

Is it hopeless? No. We can start by trying to understand what is going on.

---

On the one hand, we have people, who are intelligent. All of them (even those of supposedly lower talents can, and do, know - we  need to get the academics/uppers to wake up to the fact that the universe did not give them brains (or whatever else is their talent) in order to make then the chief kahuna). And, these people (according to the US Declaration of Independence - if you say, it does not apply to you, then, just think of it generally) are endowed with rights, etc.

So, intelligence, and how we think of its use, needs some attention (later). Too, though, rights can conflict. That brings up an issue (the Wall Streeters have a right to get everyone else in hock - oh?).

Well, discussions about humans mostly devolve to idiocy (has always). When will we learn?

Some were happy to see STEM (and all things associated with it) advance in power (ah, politically oriented nerds - is that an oxymoron of some sort?). Yet, that which is behind STEM has problems. These are subtle, hence the conflicts that we see.

Yet, quasi-empirical notions are simple. We will start there. As, Ben has missed that boat. Janet seems to be wanting to impress the boys. Well, Janet, this boy sees those high-falutin' notions as suspect from a deep, foundation'al viewpoint. Of course, the FED deals with daily issues. Yet, it ought not do things like push us to a numeric purgatory (hell?) just because it wants to look modern and smart.

Same goes for the boys/girls playing with finances via computers. There are all sorts of issues that we need to recognize.

To wit: the idiocy of letting loose the wild-west of the web that led to commercial exploitation (all sorts of bad games - yeah, Nash) and insecure practices/states that entrap hapless people. And, a lot more.

That idiocy is not well understood but will be, at some point. That is, how can people who rate so well on standardized tests, and on other means of supposedly being the best, keep getting us, more and more, into more perdition-laden states?

Wait, there is an answer. But, later for that.

Remarks:  Modified: 04/09/2015

04/09/2015 --

Monday, April 6, 2015

Constructive look at economics I

Moral: Wherein we turn our sight away from the worries (and the game) of who's on first (actually, did we see a headline like this? Blog war, Ben and Larry) or who's on second, for that matter. The whole crust (uppers) looking at these issues is way off base (have been for some time)

---

Now, "constructive" has lots of meanings, such as starting over and building. Too, though, we will be defining how a sustainable economic framework ought to look if done properly. Now, fortunately, I can do this without academic support. Unfortunately, for many, this work is late as the gaming runs along five days every week down a perdition laden path (or paths) where the insidious effects just keep on getting thicker and thicker.

Aside: if you search on some of these terms in this blog (and in the related blogs: truth engineering and 7oops7) you will see that they have been used from the beginning.

This look starts from the initial state. In short, we have people (lots to look at here). Over the millennia (many, many), what can be thought of as "class differences" has been evident (since the 1630s, those heading toward Cambridge, MA versus going elsewhere, okay?). Early on, the hierarchy was based upon power (physical). The guy with the biggest stick was king (any different now? - oh yes, we elect these supposedly better classes of people who then take a crown upon their heads - ah, poor mankind).

But, even way back, the levels came about from types of ability particular to humans, namely intelligence. So, the smart guys got some dumb arses to do their dirty work of various sorts: knocking heads, providing meat, growing food stuff, ... You see, the recent off shoring was successful (actually not, near zero, folks) due to large pockets (existence usage, here) of people who can be exploited (for several reasons: they are, they do not have any power or means, they live under the cloud of the smart/capable idiots who seem to have the say and who leave the earth worse off when they croak - again, poor mankind).

Marx and others bifurcated this (type of) separability into capitalists (the smarties who pull strings) and labor (the puppets), but this little splitting (partitioning) is too simple (shallow). When one looks at the long history, lord/serf is a good characterization (age old). What is capital, by the way (actually, where is greedy accumulation seen as leading to peaceful coexistence?)?

Some MIT guy, recently, made a refutation of the french guy's little offering (twas last year - french dude wrote, in a sense, that things of finance always float above the real concerns - like, where the next meal comes from - ..., that statement is a good as any of the other arguments that I have seen). The french guy was a little off the mark, but his attempt was of an ilk that we need to see more of. I will get back to this theme since the retort has to do with land. Does not the economic view have dealings with the lowly earth's resources on its plate?

In the initial phase, we want to look at the actors in the scene, namely the people and the various mixtures that one can observe. For one thing, that statement about everything one needs is learned in early schooling (yes, interpersonal and social aspects) comes to mind. But, it is more than that. Some, like the smarties of Silicon Valley, want to get their kind duplicated artificially so as to rule. Yes, as if the knowledge of the more in-touch mind is worthless (ah, recall the above reference to leaving things worse off). Actually, even smarties (or talent holders) of the artsy type are seen as less than those who run after money and after automation for its own sake (but, again, lots to look at here).

That is, STEM is it (or IT)? Please note that "constructive" has usages there, to boot. In short, we will get back to looking at effectiveness and at how that arises (perhaps, we can do all of this without hubris coming in from around the edges). Sensitivity to "quasi" issues would, we would hope, dampen the cowboys (yes, Ben) who run amok with their experiments (yes, Zuck) on people because they can (are allowed to) and their, seemingly, heedless rush toward glory (and big pockets, different usage than above, if you must ask).

So, again, people, markets, etc. will be the theme for a bit, though there may be uncontrollable branching offs into the more complicated realms.

Remarks:  Modified: 04/16/2015

04/06/2015 -- Two books on labor economics reviewed by The Atlantic.

04/08/2015 -- The IMF weighs in on the side of Larry (essentially, a pissing contest). We really do need to get back to the basics (and, henceforth, I'll adapt a more serious, mature tone -- but, with all the screwing up going on, how can one keep the tongue from wagging? -- as in, the little people have always been trampled over the millenia; what has not been learned is how to have a peaceful, sustainable - and other words, supposedly from the flower power generation -- economy).

04/09/2015 -- We are slowly converging toward something or other.


Thursday, April 2, 2015

Good old days?

Moral: Wherein Ben's blog motivates a look back.

Ah, those days when CDs made something. Banks didn't slap you silly.  


A little bit on bonds was in order, too. Since 2008, they have softened quite a bit. That post had this:
    Let's start with a simple example. A set of savings bonds that was bought in the year of 1980 and cashed out in 2010 would have returned 422% based upon the purchase price of the bond. You see, those terms were the norm back in those days when bonds were still being sold under a patriotic guise. As in, every payday, whether you were already doing a payroll deduction for bonds, you would hear a spiel about the need for people working in the United States to buy and uphold the country.
Yes, that is right. Bought in 1980. Cashed out after 30 years with a return over 400%. Not big enough, you say? Oh, bought when the FED was trying to drive down high inflation (which is coming, folks) so not a good example? Ah, so many things to discuss here. 

Remarks:  Modified: 04/02/2015

04/02/2015 --

Tuesday, March 31, 2015

Ben's blog

Moral: Wherein we welcome Ben to blog sphere and ponder what that might mean.

Well, he has a book coming soon; and, the web/cloud has been a great avenue to get attention. But, it looks like he is offering his viewpoint, as well.

Plus, he is not (supposedly, as) constrained as before, to wit his lectures of 2012: Ben I, Ben II, Ben III, Ben IV, and, my Ah Ben. Gosh, it seems like yesterday that he took the time to tell us his view.

---

We, the savers, have survived being slapped silly, though. And, we will continue to tell the story from a position that is very much unknown to Ben and his ilk (albeit, they are more wont to smear over us with abstractions than to deal with the reality of our existences). Nevertheless, the view from the common man needs to be lifted to awareness (and, such a view is as educated, and can be as deliberate, as is that (those) of the ones who look down from their heights on the rest of humanity).

---

So, Ben blogs, early, on interest: Why so low?  Nice to see the comments that he got. We will have to see if he responds to any, specifically. The Brookings site says that the comment activity is high.

We will do our interchange via our own method, in this mode.


Right now, let's just introduce the new means to hear from Ben who has been away from our sight for a little bit. Definitely, his new way lightens up the landscape.

---

Note: the 1% and less (as in, that very small group) are more of concern to the Fed than the 99%. We will get to that. What happened to moral hazard (and how it might influence low interest)?

---

King Alan? You too old to blog (I'm over 73 myself)? We, the people, want to hear from you.

Remarks:  Modified: 04/16/2015

03/31/2015 -- Ben has a chart showing a decline in interest. Well, guy, that correlates, very well - inversely, with advances in computational mathematics and finance. You see. The computer allows easier gaming of the system, for some. Others bear the consequences. Like yesterday. It was a seeding day. Today, things turned around as those who can take their profits from the late-coming idiots. I can explain this in detail (and will, over time). Yes, the FED has to take normative stances. But, it, too, needs to wake up to the insidious cancer that comes from technology when it is let to run amok.

03/31/2015 -- Today, Ben gets to ruffle Larry's feathers. Four hours after his post, there were no comments. Technical glitch on the blog? Readers stopping to think (say what?)? The issue is secular stagnation. Janet is worried, says CNBC. Comments at the CNBC post bring in good points (that ought to be itemized). ... However, I'm stepping back so as to change the context. Notice that Ben has three objectives of economic (read, monetary) policy: full employment, low inflation, financial stability. Given his monetary leanings, how can he consider that the wizardry required (as now being attempted by Janet and her crew) is not unlike a planned economy (gosh, at the core, not unlike that attempted by the communistic/socialistic crowd)? ... For those who might wonder, think input-output model which is laughed at by the capitalistic (invisible hand - whose?) bunch. ... So, is there another view? Yes, that which embraces near zero as a crucial entity for sustainability.

04/01/2015 -- Larry's feathers are referenced in the 2nd post (see prior comment). Then, today, Larry responds. Plus, Ben goes on about the savings glut. ... Three major posts in three days. Well, that confirms that Ben is not the usual blogger, as in, sitting at the keyboard hacking out words. However, if Ben can show a better way to use the blog medium, I'm for that. How much help does he have?

04/02/2015 -- Ah, mercy. I was wondering if Ben would snow us with an avalanche that has been building for some time. Any bets on the next post and topic?

04/04/2015 -- Yesterday, Ben talked Germany's problem. My take before reading his post: how is it that such an industrious people have the rest of the community on their backs (some proverbial bit there?)? My take after a browse: infrastructural investment? How about suggesting that for this great nation's failing backbone? Ben needs to drive around, himself behind the wheel, and to take a close look at the erosion. ... There is a glimmer of hope; Ben talking socially-oriented steps (raise wages, fund infrastructure)? After all, my reaction comes from him having been installed by a Republican administration which does have implications about his view on the world or how his views were perceived (will we ever hear from Bush on Ben?).

04/08/2015 -- Now, the IMF weighs in (on Larry's side). Pissing contest? So, my take is to start from scratch and build something, constructively. I'll watch this from far enough away to not get splattered. Ah, males.

04/09/2015 -- Stability was Ben's topic on the 7th. I want to ask the guy how he sees such in the financial realm (irregardless of the FED's put) when the underpinnings are an amoral exploitation of mathematics and computation just because it can be done under various types of cloaks (proprietary, sleight of hand, etc.)?

04/15/2015 -- The last two posts were: Low interest #4 and Hiking wages in Germany.

04/16/2015 -- Monetary policy, what? This is last update here. We'll comment elsewhere, such as this bit in truth engineering.


Tuesday, March 17, 2015

Beyond your wildest dreams

Moral: Wherein we look at the simple example which shows motivations for machinations and do a few permutations which lead to insights about things which need to be more commonly known.

What do we see? Look below. But, you will see why we used the title for the post. Not only is the multiplier magical, it's the work of leprechauns (definitely, pot-o-gold'√≠sh, so to speak).

We step through 4 cases, here. The following does a little describing of the change and the results.

Cheshire meanderings
  1. This is the simple example, as it goes through t=4 (formerly, t=3; we started at one this time and went one step further). There are only 20 stock with 2 being sold each time. The mcap (formerly, basis) accumulates. The "Cheshire" is the percentage increase that the lift (formerly, bulge) is over the mcap (dlt mcap - formerly, increment). Note, please, that Cheshire is in the hundreds. The lift% shows the percent that the lift is of the growing total. 
  2. Same case and prices, but with a large increase of the number of stock (to 100,000) and in the number of stock sold. Too, a little variability of #sold is introduced. Note, the "Cheshire" is still tame, comparatively. 
  3. So, let's keep decrease the number of stock to 100. And, starting with a price of 5, increase by 5, then increase by a fraction. Too, vary the number sold. Notice that the ""Cheshire" is still tame. This is still a very small example in number of stock (see below). 
  4. Now, blow up the number of stock and stock sold. Too, we'll keep the price reasonable, in the range of one actual case that we watched closely from IPO (interested observers - say, anthropologists, not investors). Notice the wild "Cheshire" ratings. Too, you get that even with the lift being a small percentage of the total. What? Ripe cherries for picking?    
Reminder: See last's post example of the dark pool motivation. By the way, we have a whole slew of permutations on that theme which make the case stronger. 

Note: The lift accumulates (along with the mcap) and is not adjusted (this is a future post). Why? To continue with the extreme case upon which we will put the proper modeling of the natural dampers, etc. We will want to compare this extreme case with various dampening techniques (for Janet's crowd -- you see, the markets and their whole bailiwick - capitalistic arguments - are from olden times (way back); the computer came and was basically exploited by the greedy ones; it is time to rectify this through all sorts of improvements --- look, that computational power now being spent on gaming the system ought to be put to use in providing better accounting (regrouping) and auditing schemes (of course, truth engineering, see below) -- do you not think?). 

We saw, recently, a reminder that Warren (you all know who he is) has one rule of thumb, namely the ratio of the market cap to GNP, that applies here (there are many more of his rules to consider - but, Warren, you waffled on derivatives - we would like to know why? -- BTW, derivatives, and their ilk, play the lift - there is a whole lot of room for maneuvering). This ratio has been tracked historically. Too, we will have to be cognizant of the ratio of outstanding and actively traded. 

We will use several examples, like BAC (customer of their's - the original one of SF (not the interloper) - since the 60s), to wit: 63m of 10b traded (that's like 4% - wait, almost like the ratio we see with the voting populace?). 

BAC on a recent day
Also, in the spirit of openness, let's say that our thrust is to argue "lift" (formerly, bulge) and related themes (with a computational basis) as a necessary means to recognize the mania'd state (under the auspices of Truth Engineering where we first awoke, as old Rip - six years ago, imagine that, and saw the havoc wrecked by the baby boomers - ah, guys and dolls). 

Note: With all of that lift'ing going on, no wonder the eyes of the guys like those at golden sacks bug out (the mere thought gets the salivation activated -- reminder - you will see that we have argued that the financial pipes would be handled by plumbers, et al, as those of the greedy ilk are not required - needed for liquidity? give us a break). 

Remarks:  Modified: 03/23/2015

03/17/2015 -- Changed terminology to reflect that used commonly: basis to mcap, bulge to lift. For each of these, we have a delta. Then, mcap accumulates each step; this change will help facilitate the analysis needed for the adjustments which will reflect the true mcap (coming). In this extreme case, the mcap is understated as lift has not been adjusted as it ought (we have two lifts: the mcap itself and that which comes along for the ride - see the simple example of the rise of two stocks "lift"ing the value of eighteen others).

03/18/2015 -- Today was a good example of lift. Take the DOW. It hovered in the upper 17k region, until Janet spoke. Then, there was a swing of 400 upward. You know, on the downside, there are stoppers which keep things from going as they ought. Earlier, I would have said that coo-coo (goo-goo, whatever) was talked to the addicts. But, now, I want to be technical, in a normative sense.

03/22/2015 -- Jealous? No way, Jose. FED gives Wall Street what it wishes.

03/23/2015 -- Pew Research's reports will be useful: Only upper-income families have made wealth gains in recent decades. In some of the responses to comments, one author expresses disbelief in the Fed's influence. Well, we can work on helping clarify that (by more than griping about the addicts). Our research deals, in part, with how many simple folk get to experience, and enjoy, the book-based wealth that their financial reports offer them. That is, that which is beyond Social Security (but, being sensitive to take-backs as we see, recently, happening with retirees being informed that their pension is being cut). From my experience, it is a small percentage (comparatively). The one fact of the upper crust? They have more protection which we can enumerate and illustrate.

Monday, March 16, 2015

Let them eat cake

Moral: Wherein we look at machination motivations which arise from the attitude behind the statement whether it was, or not, expressed by the Queen.

There are many cousins of her's still around and about (as well, as a whole multitude of wannabes); that lordship-ness role - wild dreams - appeals, without end.

---

So, last time, we described a little example using a small number of stock with a price that was large enough to show effects. Of course, the whole notion was about the magical multiplier (which is in effect today - essentially, a prime the pump day). In that post, we said that it was to be used for an example of things that border on misuse (inequitable, for one thing).

This graphic shows the original state which is the final one of the prior. 

Aside: We can thank Andrey for helping us to realize that, in many cases, we do not care about why we are where we are. No, the thing is to know your choices. But, this whole thing has been twisted, unnecessarily, as we have seen time and again. 

Examples of orientation: market or machination


So, we start where we left off. We have 20 stock. 6 of these have been sold. So, the total value has gone up as did the bulge. Now, supposing that one of the holders of stock (we picked #8) needs to sell as that is the only way to get some cash (forced sell situation which can be of many ilk). Then, there are many ways that this can be done. 

But, the two here juxtapose a market approach (all sorts of positive qualities) and a machination type of thing (of which the dark pool is by definition). 

Aside: We could have picked any of these. If we had picked one that had been bought early, then the loss related to #8 and #13 would have been the classic case of the late comers being the sacrificial sheep. 

Now, a sale, in the market sense, below the current price would result in a general loss. In the machination case, all sorts of activity could be done without anyone being the wiser. 

Aside: We will need to look at the end result of machinations, of these types, as they move value to the pockets of a few leaving the rest settled in the bulge (yes, Janet, your continuation of Ben's approach has caused "inflation" in the bulge, in more ways than one -- the number of hapless, sacrificial, lambs has exploded). 

Remarks:  Modified: 03/23/2015

03/16/2015 -- One criticism of this little example could be that who would sell stock to get 4 bucks. Do I need to tell you of a 300K house being sold for 6 bucks (by some stupid public employees who were trying to collect unpaid taxes -- idiocies of this nature are rampant)? This little example is to set the stage. Next up is increasing the number of stock and adjusting the price. From this, we can start to see the factors involved so as to notice what conditions are good for those who benefit from running the system.

03/17/2015 -- Dogs of the Dow: Market Cap table, Most active. Beyond the wildest dream. How truth engineering comes into play.

03/22/2015 -- Jealous? No way, Jose. FED gives Wall Street what it wishes.

03/23/2015 -- Pew Research's reports will be useful: Only upper-income families have made wealth gains in recent decades. In some of the responses to comments, one author expresses disbelief in the Fed's influence. Well, we can work on helping clarify that (by more than griping about the addicts). Our research deals, in part, with how many simple folk get to experience, and enjoy, the book-based wealth that their financial reports offer them. That is, that which is beyond Social Security (but, being sensitive to take-backs as we see, recently, happening with retirees being informed that their pension is being cut). From my experience, it is a small percentage (comparatively). The one fact of the upper crust? They have more protection which we can enumerate and illustrate.