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 --

Monday, November 30, 2015

Consequences

Moral: Wherein we look at Quora, briefly.

A question came up: Why does it matter that the Fed hasn't raise interest rates yet?

My answer: Why-does-it-matter-that-the-Fed-hasnt-raised-interest-rates-yet/answer/John-M-Switlik

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So much to discuss. The big boys and girls run with their fantasies intact. As in, they shuffle numbers up to their little platform in the cloud (no, not talking the modern theme - it's more like Mick - please get off of my cloud). In doing so, they step on the myriads.

That is my view. Looking up at the idiots. Yes, you people, mathematics does not save you. Not so does computing, either.

Janet is looking at her numbers. Why cannot we get a systems person there rather then one who has been lulled (by the fat cats and their money) into keeping the chimera going?

Remarks:  Modified: 11/30/2015

11/30/2015 --



Thursday, November 19, 2015

FED warp

Moral: Wherein we see one view of unwinding.

Unwinding? Our note, 08/24/2009: Ben offers no mea culpa; oh, he blinked and then panicked (not what one would expect of a General). Ben unwind now. The Vienna School's view that these things are undecidable (which is a computational issue) is right on.

At the time, we were all expecting some type of normal withdrawal from the addictive ways. But, the addicts won out, and savers became more flayed than sacked.

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Recently, a WSJ opinion brought this back to fore for me. How the Fed Has Warped the 401(k). The image is an excerpt.


Be sure to read the comments. A lot of these are people talking about their strategies for beating the system, in the sense of not losing their money and obtaining some type of gain. Remember, we have quoted Niels as saying that the only way to not lose is fiddling (insider info, etc.). 

What we need for savers is the savings bond, rather than the market chimera, that pays interest over time. There is much to discuss in this regard. 

Remarks:  Modified: 11/20/2015

11/20/2015 -- Taking winnings (?) off the table. 

Friday, October 23, 2015

Sustainable and near zero

Moral: Wherein we acknowledge Fallows' look at Gore's view.

Yes, we're still here, though a little quiet. So, Janet and company are stiffing the savers. I could (would) say theft, actually. We are being pilfered so that the markets can run their crooked games.

Al Gore does not like all greed. Only the short-viewed type. No, he likes long-term greed. That is nice, Mr Gore. I like your emphasis on sustainability, but with your being so close to the players you may not be able to be aware of things that are amiss.

Listen to the little guys. Not those who can belly up with the $3M that you want for your investors.

So, this is about Fallow's article: The Planet-Saving, Capitalism-Subverting, Surprisingly Lucrative Investment Secrets of Al Gore (there are plenty notes, to boot).

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What Al and friends do is broaden the scope. We all know that the quarter-reporting view is just too limited. Or, rather, it reinforces the gaming. And, little people, like the savers, lose out (we can go on about this but won't, now).

So, they add in environmental and social issues to the equations. Nice guys/gals. You do not take it far enough. And, that is where near-zero comes in. I want to see a proper/in-depth accounting (yes, I know, tilting like the Don). And, I know that I have a long way to go to make this more clear.

In the meantime, congratulations, Mr. Gore, on your success (huge accumulations). Your work, at least, was a little light added to the darkness of the greedy times. Did you really have to use that concept?

Did Al Gore 'invent ' Sustainable Capitalism?
What ;we see from this newsflash is that Blood and Gore have their critics. Look at the notes associated with The Atlantic's article.

Remarks:  Modified: 10/28/2015

10/23/2015 --