Sunday, April 3, 2016

Coddling

Moral: Wherein we wonder about the morale of the savers (poor dears).

Janet is coddling the jerks. That is, these guys handle billions (trillions). They play games all day with other people's money. Live high on the hog.

Yet, they tantrum'd when Ben merely mentioned taper. Janet continues that kid-gloves treatment.

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This is a real brief look.

However, going back to the beginning, say 2006, we can come forward and note some lessons learned. We saw it better than Ben. We are of the savers who have been flayed.

Just last week, I went and was slapped silly again. The banker telling me that they don't want deposits. You see, they're not really banks anymore.

Janet ought to bounce up to 2%, quickly. Forget the little baby steps that she and the Fed talked about last year. Then, they reneged this year.

And, what have we now? 18K is way to high for the DOW. Oh yes, I know. The whole thrust is to have someone like me go into that silly game. Who will bail me out when the suckers pull out all of the value?

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There could be links here on all of these topics, but I have been ranting along this line for awhile. With reason and a rationale.

The Fed and its ilk need to be thinking of some type of platform that would allow more stable value'd looks than this market thing (Adam rolls over in his grave, continually). Somehow, the money'd crowd got their way. I don't know of academics who want to see stability.

That is because no one (elites, okay?) has really been done down here where we get slapped around all the time. But, the economy is for us, too. Actually, it is more for us. We are millions. Janet, you and your crowd, are a very small minority.

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Stable value. Yes. You float a bond. Then you pay the holder some bit of interest. Not talking a lot. Enough of these would then be sufficient for some little person to have a future.

Forget the big names and brains, like Jamie and all of the rest mentioned here.

The use of computers to play financial games is one symptom of deep problems. Yes. I can talk that.

How about taking that power and applying it to tracking stock? Yes, each one an entity. Who bought, sold, etc. Oh, get rid of the magical multiplier? You bet.

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Enough, for now. I'm coming back to work here and will lay out the strategy. I'm old. Janet will probably still have no interest during my final years. But, I'll describe how it could be, if those whose input to the whole situation has been warping things for years were constrained, seriously, like to a sandbox with diapers. Then, the mess that we have to clean up would be smaller.

Yes, we changed their diapers and are still dealing with their crap.

Remarks: Modified: 04/02/2016

04/02/2016 --

Friday, March 25, 2016

Computers, their ilk

Moral: Wherein we mention, again, to Janet, that coddling the jerks is not the thing to do.

Ben had his taper tantrum. What do we call how Janet's actions are taken? She appears to have some rational basis. But, not, really. It's a mishmash that is post John Nash, unfortunately.

Yesterday, I was slapped silly, again. Yes, the banks laugh as they don't want small depositors. No, they would rather play the games that Janet is enabling.

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Now, one problem is that we all want to see what is rational with regard to computer prowess. We know there are some things that the artificial beast can do better than can we humans. However, winning at Go (see Google's joy) is not to applaud.

After all, all of those Go masters were of an old culture. They embodied the cultural memes, to the extreme. Some little bit of neural equivalents (supposedly) hosted on silicon-embedded circuitry does not even come close to what those human represents.

Will not for a very long time, So, could not have asked for a better Good Friday gift: ranting bot. There will be subsequent analysis after a little time to see the reactions.

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Too, on Quora, I saw this. Big-daddy data. Gosh, if only Janet would pull the plug on this mania by raising the rate. Janet, you are coddling moral idiots in their trashing of our economy.

Remarks: Modified: 03/25/2016

03/25/2016 --

Monday, February 29, 2016

Leap Day, 2016

Moral: Wherein we stop to look at the passing of time.

We started this blog in August 2009. So, this will be our second Leap Day. However, it might be interesting to see what was going during each of those earlier times.
    2009 A year into the 4-year cycle. We started out by looking at basics (such as, Money). We also were making use of earlier posts about Ben's panic. One of our most-read posts was titled "Computation, finance, and engineering" and dealt with important issues that are still needful of attention.

    2012 By now, everyone (of rational age) was looking for some remission of low interest. We got our surprise, as Ben unleashed QE (infinity, some said). Then, he did his lectures (which we started to watch real time; but, it is more fun to do it later, with a pause button). 
As said, lots pending more attention. Too, all of this is coherent over time. We'll persist in laying down new tracks as well as spend some effort in pulling together themes, appropriately.

Remarks: Modified: 03/01/2016

02/29/2016 --

Thursday, February 4, 2016

Cause and effect

Moral: Wherein we start a process of analysis and reconstruction, from a new viewpoint.

In SV (south of SF - coddled lot with starry eyes), we see a growing emphasis on causation. Why? At the same time, one hears a lot of the usefulness of econometrics. That esteemed field is quite careful about using the "cause" word. What gives?

Not only do we hear of causation, as if infinite correlative associations are observed, we see a great emphasis on modeling. But, then, SV is about computers albeit one would hope that some wisdom would arise there.

For instance, what about being a little sensitive to issues related to causation? One example would be the triad of qualification, frame, and ramification that came out of advanced logic. That is, pre-conditions, event, post-conditions are still a gnarly group of things despite the seemingly magical nature related to our displays of prowess.

The Fed has its head in the STEM-sand. So, the analysis would have to pair our predilection to think that silicone reigns.

Now, to the interest rate. The Fed and its ilk need to agree on some floor for interest. It is not zero. Japan's penetration of that (following talks in Europe of the same thing) is wrong for several reasons.

One thing that we could do then, with such a floor, is study liquidity issues. I mean in the sense associated with the analysis of Keynes and others. Elsewhere(What-is-negative-interest-rate-adopted-by-bank-of-Japan), I suggested that we need to identify two groups: gamers and savers. The former are running things (into the ground). The latter are really interested in long-term issues of which a big factor is investment.

Somehow, some (Nash, et al) have caused (there I go - causation is a multi-faceted affair of which we never remove the residue - except via chimeric means) a descent toward perdition, as measured by turbulence.  

How this all works out (Janet's unwinding from Ben's positions) will be something to watch. But, the underlying models and methods are worthy of attention from a different angle. This work is imperatively important.

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Disclosure: My degrees in Economics had a focus on Econometrics and the underlying discplines of Mathematics and Statistics. However, I spent my career working real problems in the areas supported by Engineering Computing. Now, I am getting back to the dismal-ness of Economics.

Remarks: Modified: 02/04/2016

02/04/2016 --

Tuesday, January 5, 2016

Summary, 2015

Moral: Wherein we review the prior year, a little.

In 2015, there were 44 posts.

See Summary, 2014. The "All time" reads are the same as last year. All but one of the "Last 30 days" reads are of this year's posts.

Top 5 posts 
Prior years:  20092010201120122013.

Remarks: Modified: 01/04/2016

01/04/2016 --

Thursday, December 24, 2015

My Sorry Social Security Return

Moral: Wherein we look at a prevalent view.

The title of the post comes from an Op-Ed published by the WSJ, Moday, 12/21/2015. The Op-Ed was written by Jeremy Spiegel (a frequent contributor) of Wharton.


Now, in his opinion, Jeremy would rather have had the money that he and his employer put into the Social Security Fund under his control. Remember, Bush, the son, wanted this, too.

The following compares his numbers (US$) on retiring at 70 with the maximum payout (if he lives to 90) from Social Security.
    Soc Sec, 840K
    Stock index fund, 2, 270K
    U.S. Treasury bonds, 1,280K
We will ignore that the difference goes to support many others who have not been able to pay in, such as the disabled, etc.

But, there is another issue. The stock fund would have been using the magical multiplier in creating funny money. And, out of this type of bucket, not all who have ownership can extract to the full amount. Jeremy ought to know this. The current method favors the few.

Now, can this funny gaming change? Yes. Who is thinking along this line?

In regard to the U.S. Treasury approach, yes, this can work (see experience with Saving Bonds). But, bonds can change value, too, based upon the state of the current game.

Besides, how does Jeremy know that he could hold the bonds to maturity? Even if he could, how well could we expect the majority to do in this regard?

So, not picking on Jeremy, but there is a whole lot more to the issue than he allows for. But, then, considering the larger issues would detract from the message.

Since Jeremy is in finance, a professor, I would like to know what is the basis for the gaming that goes under the guise of financial engineering, albeit we already know that greed is one motivation.

Remarks:  Modified: 12/23/2015

12/23/2015 --



Thursday, December 17, 2015

Spigot opened, a little

Moral: Wherein we acknowledge the change.

Ah, so late. We looked for this back in 2010, then 2012, then ...

And, at various places, you see the rhetoric of the addicts who, unfortunately, get more attention.

Can savers breathe a sigh of relief? Not yet.

Remarks:  Modified: 12/17/2015

12/17/2015 --