Map and territory

Moral: Wherein we consider these two concepts, further.

Why? Alan Greenspan's (King Alan's) new book (soon to be released) uses them in the title. Nice. See pre-Review at WSJ.

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Alan (the awakening?)
from WSJ review

We first broached the subject in 2007, under the auspices of 7oops7: Territory and map. Essentially, the problem causes lots of oops. You know what? It's not a simple little thing, rather the subject deals with the basis of our knowledge and effectiveness (has from the get-go, actually the topic allows to address broad-ranging issues that are of great depth - you see, the modern ilk with its computational frameworks (and money searching) tries to normalize, reduce to nothing the related complicated set of issues).

That centrality is why the next usage was under the umbrella of Truth Engineering: Territory, map, truth. Our effectiveness principally encourages hubris, it would seem. But, folks (especially the rich ones), there is more to the reality (if you don't know of near-zero, it's time to discuss and learn). Notice, too, slogans (Joel Orr is the source for one of these) can apply.

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Now, in the context of FEDaerated, we have brought up the subject a time or two. The intent is to keep the discussion going, due to its importance (the whole issue is further troubled by computation, which is a bane of the worse sort).

Here are the posts, in reverse order.

• To computational hell and back (May 2013) -- Depicting a type of hell that results from several things, but two of the largest contributors are: over-reliance on systems to the extent that the map becomes the territory, inordinate chasing after the buck causing shortcuts to become the norm for systems.  
• Money and value (Jan 2010) -- Fiat money is an issue. Human nature is problematic. Where is the glimmer of sanity with regard to money (which could be a simple matter with the proper viewpoints allowed to surface)?  
• Year-end recap (Dec 2009) -- One has to ask: is it the best-and-brightest set, and those with numeracy abilities, that is more prone to the idiocy of map-territory mashing? Yes, Harvard, come talk to me about that. 
• Why not? (Sep 2009) -- Dealing with fundamental issues that some might see as a closed case. Ah, is that not hubris talking? A little while ago, risk managers were making claims about their prowess. Not long after, the mess started from which Main Street has not recovered, as of yet. Were lessons learned?     

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Now, at the level at which Alan reigned, we see politics as being more important than reality (Oh, polls are supposed to be as strong as sensor input? By the way, markets have the same fallibility, though their usefulness has been demonstrated (without proper delineation of the limits that are necessary) somewhat.). We'll have to look at that in depth.

So, I'm looking forward to reading more about Alan's side of things. Of course, it can be fun to run after money, and big bucks. But, that is not the smart thing (yes, the Warrens, et al, notwithstanding) by necessity.

As I've said before, the whole financial thing ought to be run by people who are money-driven (just like the military is not run by the power-driven) and for whom morals are more important than big pockets. And, we can do this, despite the fact that those who lean to fat-catted'ness have run things (amok'ly) from the beginning.

Remarks: Modified: 10/27/2013

10/22/2013 -- Three articles of note: Interview with Druckenmiller (hearing the 0.001% talk about ill-begotten gains, not his, of course), HFT Algorithms (on bragging about short holding times), Barbarians at the Gateways (contrite?, but without mea culpas).

10/27/2013 --Ben has sacked the savers for years now, slapping them silly. Why? A WSJ article looked at high-class pawnshops a couple of days ago. These fill the need for people who need money but cannot get it from the banks (stupidity there, too). So, they use collateral for a loan and pay high interest. How high? Some pay over 200%, per year. What is Ben paying or having banks pay their savers (customers)? Way less than 1%. That is the best example of being out of whack with economic realities that one could ask for. Yet, does the Fed see? Why is the interest low? To push savers toward higher risk? To appease the gaming crowd (most likely this, as these are big-pocketed folks)? To help people afford housing (on someone else's back?)? ... Janet's take on this is unknown, but she has to know that they're looking like idiots. You know what? Most of those loans are paid, even with the high interest. And, still, Ben slaps the savers (King Alan mentioned saving, of late). We ought to ask the Fed, what happened to prudence or does it like to reward profligacy?