Leveraging toward the exit

Moral: Wherein we report that leveraging is on the increase and that the WSJ says that Ben is mapping out his long overdue exit.

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• Leveraging? Yes, it's like looking for perpetual motion, from a finance sense. "Something from nothing" is another way to characterize this. Actually, there is a better way. If you gambled with your lunch money, and lost, what would you eat? Of course, you could double your money. But, if you lost, would you go steal from some other person, would you beg for someone to share their lunch, or do any of the number of things that are not very much flattering to your person? What does this have to do with leveraging? Well, one lesson, supposedly, from the big crash of the 1920/30s, was to not let people borrow money in order to buy stock. Somehow we lost that. Why (about hedge funds, below)? Margin operations are of the same ilk (the nose knows) even if the big boys do this on a regular basis (did we not have to bail out the idiots?).
• Exiting? Yes, taking off the training wheels, finally or at last (when?, we don't know -- see about the tease, below). But, we have asked Ben to do this (unwind) many times; he does not know about savers (see Slaps in the face), evidently.

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The chart has been published before. This recent one (Note: I had to scan in the paper version) was in the WSJ, recently. Note that peaks in the margin curve seem to go along with market peaks.

WSJ 05/10/2013

Aside: Before someone raises the idiocy of causal connections, please consider that, as in any modern analysis, we are looking for things that relate. Trying to go toward "cause-effect" is error-ful, many times. You will not find such searches here.

So, what we see, based upon these three drops that ought to be vivid in everyone's minds, is that the market peaks get (post note on 5/14/2013 -- notice, if you would, that I didn't use "cause") ordinary people to do stupid things. You see, the graph does not show what the big guys are doing (as in, those whose pockets fill no matter which way things go -- and, as we've seen, those to whom the government loves to push out big bucks).

Again, these peaks show the euphoric glow that goes along with what the media has been saying (and say every time there's a peak) as they go gaga about the 15K DOW (Chimera, remember?). Yes, DOW 25K is imminent? Now the behavior that we're talking here does occur with the big guys, but they do it all the time (the lesson, hedge funds are for the rich; ponzis are for the poor).

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WSJ on-line 05/11/2013

This image is from the on-line version of the WSJ (wsj.com) and requires a subscription to be read. Now, only seeing a few words can be like a tease. But, Ben's little group even thinking of this means something. However, they have been discussing this for a long time (just not so that we can see, okay?).

Why can't they see that they're stifling adulthood with their continued emphasis that we need training wheels? At the same time, why do they keep trashing the lives of people like the retirees?

Ben's focus on the risky types of financials is troublesome. I can show him lots of alternatives.

Aside: Too, I'll show him that we ought to have a sandbox for those boys (and girls) who want to play risky. Have fun, people, in your little playground. Leave the world to the adults (by the way, whom are these?).

I wonder what side of Ben's mouth comes this; he has stressed many times that the training wheels will stay on until he says to take them off (until hell freezes over, it seems to the savers). He got his 15K DOW. What else does he need?

Remarks:

06/22/2013 -- So, how many traded their paper gain (chimera) to solid debt with the downturn? Okay, forget the size of the loser set, how much went from illusory gain (backed by a promise to pay later) to real debt that has to be paid with blood and guts? Wait! Some of those doing the margin calls, and ilk, have some way to weasel (not disparaging the grand animal) out, not doubt.

06/11/2013 -- CDOs and tranching, once again.

05/22/2013 -- Need to look at the cosmology of business (Remarks this day).

05/14/2013 -- All of the talking heads as saying to get into the market (as in, equity). Oh yes. It's that a sign, to boot, of approaching peaks. My response? Please, let Ben give savers, and those who would prefer a small, steady gain, a better interest rate. What he is doing is wrong on so many counts, as the future will tell us. Meanwhile, though, we doddering, older folks will have to bear up with those idiots.

05/11/2013 -- One type of leverage was the idiocy called the tranche. There are many others. Like said before, leveraging, in and of itself, is not bad. Think of it this way: many times, a leverage (multiplied even) is smart work (all sorts of examples). In finance, leveraging has no real basis, hence it de-evolves to froth (Minsky's work). In terms of JERKS (as in, higher-order derivatives but applicable to those who run after pretty balloons), there are all sorts of conditions required to support the higher-order. Finance is bonkers from the get-go. Why? It descends real quick to dealing with the more base aspects of people (and, I'm not talking greed, necessarily). Ah, the computer has us screwed when the idiots think that they look like geniuses just because they can form nicely hone graphics based upon an interminable set of numbers (not necessarily sufficient to support the higher-order). One guy wrote out names, and means, from an advanced statistical book and said: knowing this makes me smart enough to not make mistakes (ah, remember the risk handlers? -- think back to 2007 and before - if you don't remember, don't worry, as we can survey/analyze that realm in depth ex post facto).

Modified: 06/22/2013

Profits are what? Or, Gravy train II

Moral: Wherein we diverge, a minute, from the slow trek toward a position that is reasonable, and well-founded (knowledge, imperatives) with regard to that which everyone would hope is fair and just, and that honors Adam Smith and other thinkers; we pause just to ponder a few things.

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Such as profits and other illusions associated with the cap-ital-sino and its gravy trains.

Why ask about profits? A recent Vanity Fair article discussed how the Irish are paying more through the nose than are the Americans (though, it is debatable when you think of the largess of Big Ben to business (hey, guy, some of the supposed little folk are as capable and mindful than are those who are milking the land of honey -- one difference, 'tude!) and of the mountains of debt being pushed out to the future generations), for the dumb (outright stupid, okay?) actions of those who were handling the monies (and who have no sense of 'on the behalf of"). Yet, the Irish are not complaining about their huge burden or about their stalled economy. Well, in the article, some old banker is asking a hot-shot about expected returns which were in the double digits (of course, before the fall and bail out). The old guy said, how is that? Meaning, of course, that long-term, sustained returns for a good bank would be not far above 5%.

Anything above is suspicious, non-sustainable, and downright anti-human. Yes.

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Gosh, any saver can tell you what it is like to be sacked, thanks to Big Ben.

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What are reasonable profits? Mind you, before you answer, many occurrences of large returns may be accompanied by luck (hence, not repeatable), malfeasance (Made-off is only one example, cooking the books has many connotations), and other deleterious characteristics. Show me an honest firm, working within the constraints of near-zero, who has sustainable success beyond a mere generation or two?

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But, other things go into obtaining profits, such as outhousing and the like. Too, we have pushing the boundaries of cutting (see Toyota, as an example) so as to reap returns. Many times, such reduction methods can push toward a serious reduction in quality.

Why is this of interest? Well, a recent experience, involving a Sealy sham, brings this to the fore. Does diminishing of repute mean anything? At some point, one would think that good will would get chewed down to the bone.

It seems that jumping from a defensive mode to that of attacking the consumer is the preferred approach. In a sense, turn a blind eye to problems. At the same time, institute insurmountable obstacles for rectifying failed items.

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But, as we know, generally, out-sized returns happen daily. From where I sit, many of these are being pulled in by those who run things. Is that not crappy or what? Gravy train? Or, those involved have some special situation (as in, the global elite) that allows the money to flow like a huge river.

Perhaps, some type of balance is obtained if those with the dough turn around and offer a benefactor's hand to the less fortunate. I wonder if Buffett could take time to discuss, and look at, a sustainable economy (I don't mean more for your pocket, Warren)?

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It is obvious that some type of insight goes along with the luck. Can that be taught? Well, plenty seem to think so (there are many buying the training, many offering the training). Too, the reward may go to the risk, yet there is risk and risk. What we have seen, more than necessary, is risk spilling over to others, of late. In fact, what risks can be associated with our mortgaging the financial lives of those to come?

Remarks:

07/22/2015 -- Some of these are, now, poster boys.

05/17/2011 -- Golden sacks (leftmost mug of the rogue table), by Rolling Stone and Daily Ticker.

04/20/2011 -- Simple living (see Remarks 04/15/2011 - game theory), as opposed to greediness.

03/23/2011 -- The hopes spring, again, forgetting, of course, near-zero, all because of M&M. See the real story. But, Big Ben ought to know better.

03/16/2011 -- On the rise of the professional politician (will there ever be the citizen polico? that is, those who do not salivate when a buck is passed beneath the nose) toward robber barony. The M & Ms are apropos. As well, need to bring in Schervish's viewpoint.

02/24/2011 -- People matter.

02/16/2011 -- Ah, yes. The morning's paper has a couple of stories that we'll have to expand upon. We did miss the 'nationalization' chance two years ago. Too bad.

• NYSE's moves -- as the thing says, computers run (rule) the realm. Which means, essentially, the fat cats, and their techie wizards, collect their fees (huge sucking machine).
• Golden sacks -- speaking of fees, and windfalls (Gravy train?).
• Middle class -- disappearing act

Both of these are only a small sampling of many things that ought to be looked at.

Modified: 07/22/2015

Muddled mess

Moral: Wherein we finally see the world's platter filling or not; same thing as when we started back in 2009. A new set of nuances to ponder is all.

Two days ago, the Fed lowered the discount rate (interest). By a quarter point, as they say. Which isn't much, but we have been creeping along with that type of raise now for a little bit. After all, we're not at zero any more, but we're also not near the 5.25% (whatever) that was there when Ben started his cuts back in the aughts. He left, and Janet eventually started the upswing.

She never got the tape tantrum. I guess energy runs down after a while. But, we're seeing addicts act up, again. Some say that the Fed has been administering to the patient (IV wise) and finally was getting to toward release. One might say that the training wheels were being taken off the economy. Gosh, late teenagers needing training wheels? What a sight.

Funny thing? Well, the Fed met on Weds, and things (say, the DOW) wobbled up til then and went down right after. It was said (don't you love this little daily - hourly? - rationalizations?) that the 'investors' (gamblers?) we trying to get right with the news. Whatever it is, there is always some type of assessment.

Too, they talk to the 401Kers. Ah, your pot went up or down, blah blah.

Well, there are other factors which we'll not mention now. But, the Fed guy said, essentially, don't get used to this little bit of continuing largess. It's not a series. A mini-tantrum ensued? Wouldn't you think? But, the DOW started up on Thursday then went down. And is down today.

One can expect all weekend, oh, people's poor retirement, it was clobbered this week. As if. The real value was extracted long ago. Funny numbers do not capital make, but we have a long row to hoe there. Continuation of the message from the start in 2009.

Remarks: Modified: 08/02/2019

08/02/2019 --

Quants

Moral: Wherein we consider that Quants are several things. For instance, there are they who bring training in science and engineering into finance thereby raising the level of fairy dusting and elevating financial engineering (see IAFE).

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Well, we are told, better handling of finance is possible through these means; however, consider that the non-profit approach might be of more importance than has been allowed.

IEEE Spectrum had an overview (The rise and fall of the quants) in the August, 2009 edition which describes the experiences of a few. It's interesting that some of them fell into the best-and-brightest role, namely a youngster who helps fat cats fill their pockets thereby earning outrageous amounts themselves.

Not that there is anything against making a living, or getting filthy rich (if done fairly and legally), yet the techniques related to the quants can (ought to) be heavily research flavored (The Physics of Money, What they need to learn, In his own words). And, guess what? Some win. Others lose. That's the way life is.

Yet, the influence on either side goes beyond those playing the game. Yes, these shenanigans leave ramifications. What? Yes, it's true.

Old Ben is too busy keeping things afloat to look at this. However, he cannot expect to have a stable economy without these influences being under control.

Merton suggests that perhaps only 2 out of 100 bright ideas pan out. Think of all those side-effects that come from applying tests, uncontrolled except for measurements oriented toward how big the pockets get, on the fly (see Wired's view).

Outrageous! Where the hell is the outrage or is everyone running after those dollars being thrown out by Ben, the pied-piper?

Why is this allowed? Some type of cultural blindness that relates to the economy and money? Somehow, the Lords prevail even though they monkey the works (Mother Jones' view).

Ah, yes, the pay consultant says that the high CEO pay (or any) is due to the small cardinality of the set of those who have the right qualities. Crap!

On a final note, mathematics' role will be covered here. Remember, though, that our success hinges upon economics becoming less 'dismal' as a science; yes, too, notions related to people not being understandable are suspect as they're an excuse for covering up pocket picking.

Remarks:

11/15/2015 -- Quora coming into the scene.

03/15/2015 -- Finally, getting around to the pending business.

03/03/2014 -- Acknowledgements, including math pedigree, will be expanded.

10/24/2012 -- Goldman skimming via Quants and their creative finance.

03/15/2012 -- Okay, might have used incomputability (see post on Alan M. Turing) but stand by the context, the issues, and the need for resolutions. Wake up, quants (you, too, Ben).

10/07/2010 -- Several principles need to be explored, such as the ergodic one.

12/10/2009 -- More roles include the consumer and the economy.

09/01/2009 -- Oh, one might ask, why do I pick on Quants? A good question that we'll expand upon over time. They're like explorers in a new territory who mainly pillage and exploit when we, the human race, need more those who can map and help us learn. Learn as in real knowledge not just moving monies to certain pockets. Yes, indeed, a map-territory issue here among many others.

08/27/2009 -- Let's start talking computational issues and how they contribute to systemic risk.

08/24/2009 -- Further message to the Quants. Have you looked at the Vienna School's discussion of undecidable which applies, big time, to your milieu (even with the numeric overlay)?

08/21/2009 -- Need to start a list of technical things to discuss: ergodic hypothesis, sojourn time, ...

08/20/2009 -- Note 1: 'Derivative(s)' has been used a few times in the posts. The context may imply the usage, hopefully. But, in general, we're talking two types: 1) from finance, where 'derived from' is the proper interpretation (or as one may surmise from posts here and elsewhere, something from nothing), 2) the usual mathematical variety.

08/20/2009 -- So, Quants have their following, as evidenced by this 'hero' worshipping text from Wikipedia (hey, I'm a contributor and believe in what it foretells) that we find int the Slang Section: Rocket scientist, a financial consultant at the zenith of mathematical and computer programming skill. They are able to invent derivatives of frightening complexity and construct sophisticated pricing models. They generally handle the most advanced computing techniques adopted by the financial markets since the early 1980s. Typically, they are physicists and engineers by training; rocket scientists do not necessarily build rockets for a living.
Of course, that could have been written by a self-absorbed Quant. But, 'frightening' is the right word; yes, they may have been adapted, yet at what grief? At least, a real 'rocket' can be tested in a natural setting. These models? One purpose for our discussions here.

08/19/2009 -- I said earlier that, after some jawboning, I would get serious. Well, it's time. Why now (after all, I wrote that in October of 2008)? Well, hasn't the past year just been full of 'say what?' moments as things unthought of appeared without much clamor. Also, it's good to see the enthusiasm of those who have gone through MFE courses (yes, we do have to divert from the MBA mentality), plus the fact that blogsphere (like, Hail the Quants!) has allowed these students to share their thoughts is inspiring.

But, first, a couple of messages.

• To the non-Quants: not everyone has to run after the martingales, folks, in fact, the world needs those who can counter the quantitive bias. That is, we'll have computers. But, we'll also need to truth engineer these beasties, and those who are their keepers, using means that are analog and intutitive.
• To the Quants: if you take exception to this post, accept my apologies, but the intent is to riddle any who runs after money using insights provided by our mathematical talents. What we need is a collective approach to found the basis for the dismal science in a more positive approach (notice the absence of the 'istic'). Guess what? The framework will be computational with humans in the loop. So, there will be plenty work available for Quants.

Modified: 11/15/2015

Market is rigged?

Moral: Market is rigged? Oh, confession time? It's been a problem from the beginning.

Money looks at the matter, talking to Michael Lewis. He was in insider, it is said.

Well, I am an outsider and ask why we need this insanity (I know, people like Cramer make a mint of money playing the system). Not only is it rigged, it is a chimera. Meaning what? Only a fraction will get the promises. The whole design is to milk the little guy.

60 Minutes talked to Michael and another guy who brags on beating the high-frequency people at
their own game. Big deal. Well, I should say, big money.

But, the issue of the Bens and the Janets feeding this crap shoot remains to be discussed rationally. Too, the whole framework is suspect from the get-go, except for those who are benefiting from playing the game.

The 60 Minutes guy mentions front running. Well, there was an agreement that we now have something like that. Yes, change the name and  computerize the thing, then, it's okay? Remember Made-off (Bernie)'s little gimmick?

Juxtaposition

House of cards. Does it need to be that way? No.

Remarks:  Modified: 03/15/2015

03/31/2014 -- Huff Post and Money weigh in. My comments on the Money article.

-- Most will not get their's. That is the whole scam which has been played time and again (and the poor souls coming in now will take a bath soon). The thing is to keep the people happy during their work years so that they keep ponying up. Then, when it comes time to draw out, what they get is not what was expected for the most. Why is this not understood? The analog is what we're seeing with the un-kept pension promises. Oh yes, some get and get big. That is the dog and pony part (ignoring that the elephants who run the system rake it in all along the pike) of this thing. Put forth enough examples to keep people's interest up. Oh yes, my 401K is up; I'll be a rich man someday the little guy thinks (ah yes, let's see what you really get). Some get big. Most get less (much less). Many get naught. The worry of the boomers all trying to draw out, at the same time, are very much real even if the thing wasn't rigged, and the leeches were not sucking out feed, and those who run the system weren't pulling off the cream. How can so many smart people buy into this crap? Ah yes, get it while the getting is good. Why did Ben (and now Janet) put so much effort in keeping this beast alive?

-- The middle class always gets screwed. The early sellers take the pie; the rest eat the crumbs. Time and again. Somehow, this whole house of cards has been given credence by appealing to Adam Smith and others. Now, with the computer, it is even more of a problem. All the while, we have a whole set of underpaid people putting themselves and their lives on the line for this type of chimera, thinking that down the pike, they, too, can get their just share (and then find cuts due to budget concerns and such). Was anything learned from the last go-around?

03/31/2014 -- So, Yellen is supposed to keep slapping the savers silly while the monsters play in the so-called market, essentially screwing the public royally. 

04/01/2014 -- Yellen's defense of the Fed is hot-air, but then the markets are inflated from such. Yellen says that many see a recession still in place. Yes, only the market manipulators are rolling in the dough. Yellen goes and talks to the small folks. But, has she ever met a saver? Perhaps, she would rather have people spend even if it's from debt (an ever-growing onus than entraps people and their families). Ah, Yellen is worse than Bernanke? She must know that the training wheels have to come off for the markets to grow up and to become less addictive to Fed largess.

04/02/2014 --

03/15/2015 -- Finally, getting around to the pending business. 

Social business

Moral: Wherein we continue the pause (last week, WSJ) and consider a USA Today interview.

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Ben has been for the big guys, we all know. Too big to fail is how some of these guys are characterized. This, as if we need to bail them out time and again no matter their infatuation with moral hazards.

Too, is Ben's time short? He's not gracing the Tetons with his presence this year? Will they recover from the slight?

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It was refreshing to read this interview with Muhammad Yunus. He got a Nobel Peace Prize for his work in showing another way to do business. The fact that he was dealing with supremely poor people and that he pioneered "micro-loans" is of interest. 

Yunus suggests that business can have some social focus versus that of pure profit motive. Where the latter came from (greed, profit, ...) and why it takes so much of our attention, we'll have to look at. But, the sacrificing of the common good to the benefit of the few (all sorts of ways to discuss this) cannot a sustainable economy make.

Yunus has brought his concepts to locations here, too, in the land of the free and the brave. Why was he needed for this type of thing to happen?

It's almost as if we have to import our conscience, given that the country's business leaders have descended to having no interest except for the pursuit of money. And, the finance industry's drive in this manner, raking in their supposed profits, is well-known.

We can very well drive the whole thing with a flavor of community service and utility.

Remarks:

05/09/2013 -- Ben needs to take off the training wheels and let the markets go where they may (falling mode, most likely) and let the seniors have a little stability (Slapped silly, again, yesterday).

05/06/2013 -- Yunus as saint, comparatively?

Modified: 05/09/2013

2010 to 2013

Moral: Wherein we weigh in, rationally.

Federal Reserve Bulletin, September 2014 (Vol 100, No 4 - pdf) has some juicy tales to tell. We'll just look at one and give our explanation. This Fed report looks at results from the triennial Survey of Consumer Finances (SCF) and provides us with their interpretation.

Nice. In fact, one section mentions "saving" (which is not a foreign concept - have we, perhaps too much, stressed the maltreatment of those who save? Not!). See Box 4 which looks at "Saving Behavior" and shows what we would expect. The more one makes, the more one can save. The less one makes, the less the savings.

Moral-oid: The less one makes, the more important savings are; too, playing the ca-pital-sino with one's hard won savings is not rational at many levels of these levels of income.

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There will be plenty to talk about in this report. First, though, let's remember that the 2010 SCF showed declines from 2007 for most. We will have to go back to look at that. And, we will relate what we see, to boot, to our start (August, 2009).

I pulled Table 2 out (see image) from the report. Now, some things strike me immediately (if it is not apparent, my interpretation will differ from that of the Fed Res -- and, my viewpoint is well-founded in both theory and practice and experience).

Please, look at the second grouping ("Age of head (years)"). Then, consider the age groupings. For one, "75 or more" represents the class of those who have been "flayed" by the policies of late. These are those who cannot use the ca-pital-sino, except in a limited sense, in a reasonable fashion (look, the majority of those in financial services/consulting - advisors? - need a lesson in "near zero" as part of their training). Many of this group who did try the ca-pital-sino lost and could not recover.

So, "75 or more" had losses from 2010 to 2013. Guess what? That is on top of what they had already lost from 2007 to 2010. If you look at the Fed's actions in supporting the fat cats, you ought to see that they need to understand the need for "stable" means to manage one's "wealth" (lots to talk about there, too). And, "stable" would cover much more than those age-sensitive strategies that we see touted so much.

But, notice, too, that the age groups of "45-54" and "55-64" also lost. An in-between group gained. Methinks that these are those who could delay their retirement (the inflated 401k types - virtual money, except many of these (early takers) will be able to get their little bit of gain - most will not).

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Enough for now. The report is worth a read or two (see above link). I am thankful that the Fed does this type of analysis on a regular basis.

Remarks:  Modified: 10/06/2014

10/06/2014 -- Banks proved themselves untrustworthy in this last downturn. Of course, they were bailed out; but, many who felt the ramifications of their misdeeds (said to be stupidity therefore not illegal - but, immoral?) were never compensated. Consider please. With the troubles of the cloud, and bankers, like Chase, being hacked, are we not in a worse situation than 2007 (thereabouts)? There is still much to discuss about computability (and beliefs thereof).

Ben and the taper

Moral: Wherein we digress further from our business of cosmology while we consider a new concept that has been pointed to as being behind a drop.

Taper? Yes, it's the same as unwind, remove the training wheels, and a number of other ways to look at the reversal of Ben's largess.

No doubt, Ben will talk goo-goo (baby talk) again, and the equity markets will soar (partly on the backs of the savers). How far can it go with Ben's assist?

Also, one source said that Ben doesn't like the use of taper. Okay? Why?

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Actually, we ought to ask, how far ought it to go? We're in new territory, several ways. So, that gets us back to the post-Ben (new era) analysis that will come about. Too bad, this look back won't help Ben (as he told the Princeton crowd, recently -- actually, Economics does not even have 20-20 hindsight - but, then, who does? singularities (search "singularity") prevent this) extricate himself from a bad situation. Bad? Yes, junkies who are dependent upon his handouts. Talk about a sense of entitlement.

It goes like this: I, as an investor (playing in the ca-pital-sino), must (deserve to) have the Fed wrap itself around the axle (forgive the vernacular'ly oriented usage) in order to make things well for my kind at the expense of all other economic kinds.

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Taper? or
Go cold turkey?

Now, back to the subject: taper. This implies some type of graduated approach. Ben might see this as being long with a slight, incremental change. You know, Ben, some see "cold turkey" as more advantageous. Consequences? No more than a tailored withdrawal. Besides, the memory of enduring the withdrawal might cause a little more reflection in the future before settling into another addiction. Wait! That type of thing may not be in Ben's worldview. I'll have to look more closely at his speech. There is one problem; he was trying to be humorous. The truth can be funny; but, many times, funny is very much untrue. Yes, one of those dilemmas that we find ourselves in.

The real crux? Ben knows what audience that he is playing to. But, patting fat cats on the back now may not add much of value to his long-term reputation.

Remarks:

02/11/2015 -- Wikipedia: Zero interest rate policy.

12/19/2013 -- Ben did his parting shot (whimper that it was); they're going to taper slowly, less than a 1/8th on the bond buy, starting next month. And, he's going to torture savers for another year or so. We'll have to see how the pieces fall. The markets got heavily seeded today in hopes of luring in the idiots and moms/pops (who cannot afford the pending losses). So, it's pop, fizz, ..., again. Too, we'll see more goo-goo talk to the immature markets and the addicted investors thereof. One of many technical issues that we'll have to get into: Nanex's view.

10/31/2013 -- Finally, a voice of reason. Just the headline tells the tale: Tapering without tears - how to end QE3 - by Ronald McKinnon, WSJ, 10/28/2013. Essentially, going to zero was an error. Thanks, Ben. There are too many negative effects. Besides, trying to control unemployment with that little knob (which Ben dialed to the maximum, early on -- see "out of bullets" discussions from 2008/9 -- which, by the way, was untrue as Ben creatively ventured into new areas, taking us down the perdition path). Actually, what he is trying to do is push string (try that for ringing a bell -- push needs to be changed to pull).

08/21/2013 -- I was wrong. I thought that Ben would go goo-goo, again, as his doves want him to do. But, there is talk of a taper, albeit slowly. Sheesh. No one does "cold turkey" anymore? That's how I quit smoking. Why is it that the FED feeds addiction (that's a monetary policy?)? Now, when does the slapping the face silly quit?

08/15/2013 -- FED site, FEDofNY: Pre-FOMC Announcement "drift"

08/07/2013 -- Investors? After the last taper talk (more than a month ago), things jiggled a bit. Some lost money. Some gnashed their teeth (but, for someone, like my ilk, who has been slapped silly for several years now, what comfort ought we give to those who don't know how to wean themselves from their addiction? --- in the meantime, Ben, we, the savers (saviors?), continue to be good citizens despite the Fed's attempt to trample us under the dirt). At that time, Ben had his Doves talk goo-goo. So, the mania began again. Yesterday, there was a slight downturn supposedly as some Hawk (or two) said, perhaps, next month there might be some fiddling with the taper (the talk wasn't that the investor would get reamed - forgive me, I was in the U.S.Army at 17 and learned some good lessons -- also, I was a medic so I know of orifices, to boot). Ben's problem is that he's in a fog (who isn't?). Yet, he runs around with the elite like an oracle (he ought to consider some of the Prophets about which he knows, perhaps), strokes the addicts, bends in to the money'd, and more. And, he looks for signs (omen analyzer -- ah, age-old behavior). And, he misses the obvious. For instance, what they're calling jobs (related to his triggers) are really just glorified indentured servancy roles. In fact, these things are to drive a consumer-oriented economy? ...

08/05/2013 -- Let's see. Financial Engineering needs some attention. Perhaps, with the likes of MIT involved, this discipline can learn to lead the way out of the morass. Expect more on this topic. If things continue as they are, markets will be pure chimera (as in, ca-pital-sinos). Investors? We'll go on about that, too. It's guaranteed that most in the equity markets will lose. Why is that not talked about by those heads we see daily yakking on TV and newer media? No, they would rather go gaga (apologies to the Lady). So, we'll have to address this issue: the point (price) at which loss outweighs any gains to date. All cannot sell to make a profit. Now, there is a way that all could sell high (government as the buyer of last resort - Ben has been doing this, albeit with bonds - yet, it frees up money that can go to equities -- government? of course, taxpayers). We'll have to look at the misuse of mathematics; plus, doers need to be brought back to a respectful position.

07/31/2013 -- Ben cannot unwind or taper down; he has too many Doves.

06/25/2013 -- Ben doesn't have to talk goo-goo. No, his hawks can do that. Today, the MN guy saying that they need to continue accommodation due to financial crises. Sheesh. Crises? When do they ever end? And, what about accommodating savers? Those who sold were the ones in early making "gains" almost beyond bound. It would be nice to have quiescence once to do an accounting (about as much a pipe dream - several reasons - as it is for someone on the Fed to argue for the little savers).

06/22/2013 -- So, how many traded their paper gain (chimera) to solid debt with the downturn? Okay, forget the size of the loser set, how much went from illusory gain (backed by a promise to pay later) to real debt that has to be paid with blood and guts? Wait! Some of those doing the margin calls, and ilk, have some way to weasel (not disparaging the grand animal) out, not doubt.

06/20/2013 -- Ben talked, the markets took a downturn (hey, go to 12K or less for the DOW, please). You see, he didn't say goo-goo and talk additional little goodies for the idiots. No, all he did was not throw in help (addicts will steal their own mother's assets) that is not needed; too, there was the slightest hint that, at some point, the idiots will have to stand on their own as adults (meaning, removing the gaming thrill and moving toward something more mature and sustainable). ... Of course, there have been these before. People call them corrections. Then, things get hot,again, as some want to explore new levels. All the while (this is from the beginning of equities, folks), the real measurements are far from getting attention. Look. Rigged markets? It's worse than that, as we've alluded to here since the beginning. ... However, to where ought we to go? That is not an easy question to answer. You see, the idiots have driven things this way a long time. Ben knows that as his academic work looked at the '30s (as in, 1930s). Why idiots? Well, it has to do with several things, not necessarily moral in context. We won't dance away from that, though. Perhaps, we could paraphrase Oscar Wilde's look at war as vulgar versus wicked. Same here. The types of things that seem so smart in finance are vulgar at their core. Why? They hurt people as much as bombs. The latter kills or maims you. Financial flimflam maims but in a more insidious way. No, these ways are not wicked, they're vulgar. We'll have to characterize that as we continue our look at cosmology.

06/19/2013 -- With computer-based trading taking such a big role, what does all of this gaming mean, day to day? Ben's word watched so closely? Is that not a funny thing? I wonder if he worries about the legacy that he will leave with his upcoming departure? There are two key factors to all of this: savers have been slapped silly (it's a wonder that there is any skin left on their face), these triple-digits upswings suck from a very large number of pockets (that is, near zero is the situation - with those running the game growing their pockets).

06/11/2013 -- So, volatility is back from its languid ways. Some see this measure as a risk indicator. ... It's interesting to watch the twice daily rationale given for ups and downs (example, today). Then, there is running commentary, daily. Some of it right on the nose. ... Ben ought to think about those who he's been sacking, namely, a large, important element (savers). The current means may lessen the load of debt for those who want to build their proverbial ball-and-chain, but it also encourages the run-amoks (especially, those who run after risk like junkies after the pusher (ought volatility be enough for them?).

06/06/2013 -- Ben hasn't spoken yet, on his tapering ideas. But, the DOW was losing, then it turned around. His group, the Fed, did say that American's net worth has regained ground (to around the 2007 level - before inflation). Nice (but, Ben's balance sheet is now tripled (or more) the size -- from which position he'll need to move, at some point). It was admitted, too, that it's the top 20 percent who are raising the level. So, do all boats, then, rise (or does wealth trickle down?)? BTW, please try to keep procto comments to the minimum.

Modified: 02/11/2015

Gigantic sucking sounds

Moral: Wherein we consider the benefits of social business (not Zuck's realm), the chimera's loud calling, and more.
---

The subject? Back in the days when inter-border (USA and its southern neighbor) economic relations were being discussed in terms of allowing more flow (yes, are the benefits as good as we were told that they were going to be? -- massive influx of undocumented?, ...), some argued about things being sucked south (say, jobs).

Well, what we have now is this Wall Street thing (the Wall being used to represent, basically, market-oriented activities that are, many times, not necessary) which is growing quickly while sucking value from the pockets of the hapless, such as savers (and many others).

Why Yunus and the chimera in the introduction?

---

Well, it's not that Yunus is a saint, yet he knows more about what business is (ought to be) all about than do many from western cultures. Yet, it's those latter that we have to deal with in our western world. Alas.

Chimera? The large sucking machines are getting a lot of attention, more than their problematic basis (to wit, ca-pital-sino) suggests is reasonable. It's an arguable point, of course. But, how can Ben continue to trash the lives of so many folks?

---

Who are these folks that Ben has thrown off the train? Consider these two types, please:

• Profligate - works, but spends more than is made; the difference is handled by debt which increases with each stroke of the clock. At what point is the debt paid? As we've seen, many have had their debt forgiven and paid by banks (reimbursed the pockets of taxpayers). But, many more have not had their debt paid, and it is still there when they croak. Again, at that point, there may be creditors losing out, yet the person's estate suffers, too (nothing for the dependents and so forth). 
• The non-profligate - works, spends, but less than income; the difference goes into savings (either for a rainy day, for a major purchase, or for the later years -- all sorts of ways to characterize this). Yet, to what (where) does that extra money go? The mattress? Gold (even with this, where is it stored?)? Ben (thanks, guy) has fed (pun intended) the mechanisms that do the gigantic sucking. For what reason, I'm still puzzling. His publishing the talks from last year does not explain much (see my notes, please, Ben). 

Ca-pital-sino

Of these types, which is more important to an economy? Notice, please, they both spend. The former does so way out of proportion to what can be paid back. Is that something that we would want all to do? Who would pick up the tab, ultimately? 

The major problem is that Ben has closed off any access to means for the latter (the non-profligate, Ben - those whom you do not seem to know even exist) to put their savings that has any semblance of "gain" (as Ben, evidently, wants, mainly, the ill-begotten type). The thing that Ben wants is for all of us to play the casino (yes, why not add russian roulette, Ben?) that gets such attention every business day (media up the wazoo, all day). 

---

In terms of magnitude, Ben is into the pockets of savers for billions. How do we get a proper accounting of this (note the take on Jamie way before he got in a hot seat)? And, he says that he'll continue (or even up the ante) for years more.

Remarks:

03/15/2015 -- Finally, getting around to the pending business.

05/22/2013 -- Need to look at the cosmology of business (Remarks this day).

05/09/2013 -- Ben needs to take off the training wheels and let the markets go where they may (falling mode, most likely) and let the seniors have a little stability (Slapped silly, again, yesterday).

05/07/2013 -- So, those two categories (profligacy focus, motivated by the Biblical story) are a broad-brush look. Of course, there are all sorts of nuances which (by the way, I can handle; if anyone has any doubt, deal with me directly) need a look. [Aside: you see, the push to differential (stochastic) systems comes from the inherent complexity (which has been overdone, okay?).] Debt, in itself, is not bad, especially if it's tied with collateral (and I don't mean those fantasies behind some higher-order finance - sheesh - abstract'd synthetics). One can even think of leveraging (a natural state of affairs as we learned way back with the Greek mind) in a rational sense in the context of liquidity. Yet, there are two other concepts that are apropos: source and sink. Debt? It's more of the latter. Except, the way we saw the idiots use houses as ATMs (and all sorts of parallels exist here, folks - Hawker comes to mind - recent bankruptcy, etc. [I had an upclose look, closer than many, okay?]), debt does put money into the pockets of some. Government deficits do this, too. They extract from sources. What Adam was suggesting was that spirits are natural sources (actually, this whole area is where I can weigh in with a newer theory - in time). But, we don't have perpetual motion (look finance smarties, be a little more thermodynamic, please) anywhere (again, big M and T come into play here). The truth? We cannot have sustainability where we have more sinks than sources. Jamie? Your ilk are sinks, okay. You don't have to be, but this is how you have been allowed to evolve. Let's get theme memes back in order, folks. ... Later.

Modified: 03/15/2015

Hawks and Doves

Moral: Wherein we claim that we are not knocking Ben (and his ilk) and that we are interested in the future of economics.

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Or, we're interested in the economics of the future. More on that below. We'll add a new twist and look at Ben's ilk (well a subset defined by participation in the FED's bumbling ways). Why? He may be leaving; too, he has not been a lone player all along, though it's his face that we see when the FED has to talk to us, Congress, and the press.

You know, it's more of the last. But, what could the FED say to someone that it's torturing daily?

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Right now, we have to report that the WSJ did an analysis which showed that the Doves were better at prediction (at least within this time frame) than the Hawks. The WSJ also talked to a few experts who made various observations. Let us add one: does self-fulfilling prophecy come to mind?

Aside: the image shows the table with results from the WSJ study.

Dove? Yes, those who coo-coo, while Ben goes goo-goo, after which the market'rs (more than addicts, ..., bordering on criminality) go gaga (again, apologies to the Lady). That is, those who don't want to taper (heck, they ought to unwind).

Hawk? Supposedly, someone who says to take off the training wheels (sheesh). These don't seem to have much say.

---

Now, about the future. Of course, predictions need to be done. Call them forecasts so as to bring in something a little more sane, weather prediction. By definition, these are look-aheads. Who has 20/20 foresight? Heck, we do not have 20/20 hindsight (all sorts of issues, such as our underdetermined basis). So, look-aheads would be based upon good methods, but they need to be updated, to boot.

You know what? The push to book cooking comes from a serious idiocy that has been allowed to manifest itself as smarts in the business world related to look aheads and meeting them (monthly dance of the CEO/Kings, the new royalty). And, we claim science and engineering as examples of our progress? Wait! I did use busyness, did I not? STEM has some applicability there; yet, busyness will need a whole lot more.

Aside: Remember about six years ago, thereabouts, when all we heard was that risk was solved and that would not be another downturn of a serious nature. Well, if you do not remember, we'll have to pull that idiocy to the fore in our argument for the necessity to be aware of singularities (to be defined further). The mess now is even worse than before things fell apart from thinking problems that are very much analogous (even related) to the risk fantasy (fair dusting, indeed).

Too, we need to re-look at money. Right now, it's some cosmic (comic) bit of crap that is managed by a set of wizards (recent books and articles discuss this whole issue). Yet, there are those who have reaped the rewards (raped the economy, at the same time). So, we can see what money can do. We cannot see all of the downsides (evidently, otherwise we would wake up and do right, yes?) for which the near-zero concept will be important.

---

Ah, so much to look at. Thanks, WSJ, for the study.

Remarks:

07/25/2015 -- We're about six weeks after the June look back at 800 years ago (Magna Carta). Too, though, poster boys have popped out of the woodwork, including Zweig.

02/11/2015 -- Wikipedia: Zero interest rate policy.

09/17/2014 -- The coo-coo, goo-goo goes on. The landscape is strewn with the lifeless bodies of the savers. Thanks, Janet.

12/19/2013 -- Ben did his parting shot (whimper that it was); they're going to taper slowly, less than a 1/8th on the bond buy, starting next month. And, he's going to torture savers for another year or so. We'll have to see how the pieces fall. The markets got heavily seeded today in hopes of luring in the idiots and moms/pops (who cannot afford the pending losses). So, it's pop, fizz, ..., again. Too, we'll see more goo-goo talk to the immature markets and the addicted investors thereof. One of many technical issues that we'll have to get into: Nanex's view.

10/03/2013 -- Oh, yes, two posts (Fed-aerated and 7oops7), but no mention of savers being slapped silly. Notice in the savers post that an image says no bullets left. Ah, yes, Ben panicked and used up his ammo. But, has he not shown all of us (and the world) that there was a whole lot of other maneuvering possible? But, too, does he know that he's cowboy'ed us into a corner?

09/18/2013 -- Pop, fizz, ... Ben had to show largess because of idiots who ran the economy to the ground (rogues all around). Ben is going. What do we have to look forward to? Businessweek has a review issue (of the past five years). Several articles are especially interesting. Too, phrasing shines: spin dross into gold (in relation to mortgage bonds). Perhaps, we'll get back to some of the more pertinent ones, at some point. If we do, it would be to bring forward what has been said here, from the beginning. To wit? Tranche and trash (WSJ has a good take on that). Securitization? This article brings on weeping (one example of the misuse of mathematics and computing that has been harped about). Adoption, and improved understanding, of lazy evaluation let loose the powers that resulted in the wild web and its little children, namely social media and more. To grasp the problem, we have to go back to computing that is in some type of responsible area. Avionics comes to mind. If what is couched as software in looser domains (financial engineering? -- looser?, yes bailouts are the norm despite all of the protestations of the ruling elite; or the whole cadre of the poorer folk can just suck it up when there are problems in order to relieve the fat cats' loss) were to used in flight controls, would we not have planes falling out of the sky? We'll get back to the simple issues that seem to not be seen by the elites chasing after the bucks that Ben has been throwing out of his helicopter.

08/21/2013 -- I was wrong. I thought that Ben would go goo-goo, again, as his doves want him to do. But, there is talk of a taper, albeit slowly. Sheesh. No one does "cold turkey" anymore? That's how I quit smoking. Why is it that the FED feeds addiction (that's a monetary policy?)? Now, when does the slapping the face silly quit?

08/15/2013 -- FED site, FEDofNY: Pre-FOMC Announcement "drift"

08/07/2013 -- Investors? After the last taper talk (more than a month ago), things jiggled a bit. Some lost money. Some gnashed their teeth (but, for someone, like my ilk, who has been slapped silly for several years now, what comfort ought we give to those who don't know how to wean themselves from their addiction? --- in the meantime, Ben, we, the savers (saviors?), continue to be good citizens despite the Fed's attempt to trample us under the dirt). At that time, Ben had his Doves talk goo-goo. So, the mania began again. Yesterday, there was a slight downturn supposedly as some Hawk (or two) said, perhaps, next month there might be some fiddling with the taper (the talk wasn't that the investor would get reamed - forgive me, I was in the U.S.Army at 17 and learned some good lessons -- also, I was a medic so I know of orifices, to boot). Ben's problem is that he's in a fog (who isn't?). Yet, he runs around with the elite like an oracle (he ought to consider some of the Prophets about which he knows, perhaps), strokes the addicts, bends in to the money'd, and more. And, he looks for signs (omen analyzer -- ah, age-old behavior). And, he misses the obvious. For instance, what they're calling jobs (related to his triggers) are really just glorified indentured servancy roles. In fact, these things are to drive a consumer-oriented economy? ...

08/05/2013 -- Let's see. Financial Engineering needs some attention. Perhaps, with the likes of MIT involved, this discipline can learn to lead the way out of the morass. Expect more on this topic. If things continue as they are, markets will be pure chimera (as in, ca-pital-sinos). Investors? We'll go on about that, too. It's guaranteed that most in the equity markets will lose. Why is that not talked about by those heads we see daily yakking on TV and newer media? No, they would rather go gaga (apologies to the Lady). So, we'll have to address this issue: the point (price) at which loss outweighs any gains to date. All cannot sell to make a profit. Now, there is a way that all could sell high (government as the buyer of last resort - Ben has been doing this, albeit with bonds - yet, it frees up money that can go to equities -- government? of course, taxpayers). We'll have to look at the misuse of mathematics; plus, doers need to be brought back to a respectful position.

07/31/2013 -- We'll have to address the take that Ben has applied to savers so that he could put it elsewhere (mainly, into the chimera of the ca-pital-sino). That is, make its magnitude known (very large). How can Ben sleep at night with the growling tummies of all of the savers whose dinner he gave away to the fat cats?

Modified: 07/25/2015

To computational hell and back

Moral: Wherein we pause our look at foundations and consider a collateral subject: the mess that we are in.

What mess? The DOW hit a record recently. Isn't that special?

Well, as Ben knows, such milestones don't really put any bread or butter on the table of a whole lot of folks. Rather, the game enriches the few (comparatively --- to those who would quibble, ever look at the 60-percent level -- more or less -- and below?).

---

And, to hell? Yes, let's hope that we can get back.

---

Business offloaded customer support, with a process that started a long while ago. Any idiot (such as myself)  knows when there is more to communication than a common language. I got to the point where I don't talk to the person unless I perceive some understanding of the American way (we'll go into this later, at detail).

Now, some of the better businesses have been bringing things back. For American consumers, that would be a good thing. As, that means jobs.

Along with the off-shoring, business have been spawning off computational processes (and apps) without any feedback from the users, except ex post facto. I'm talking specifications here, folks, But, the elite might say that such thinking is out-moded. As in, let the money drive things (we'll get into this, too -- Note: 05/30/2013 - people say that we're being driven by machines (which are out of control); one way that this happens is that the big software people (you know who you are) push out changes to which we have to adapt - the notion is that it's a market-type choice - nothing could be further from the truth).

Doing systems correctly would create American jobs. We can discuss this. And, doing them as is really needed will be costly. The trouble is that the market (which is what? little players (meaning, character - they have bucks galore) who must have their training wheels in place - put there by Ben, of course) and its apparent success seems to work against the reality. Until, there is a crash. But, then, the same old crap starts again (Note: 05/30/2013 -- not only are people supposed to bend to the whims of systems, and their purveyors, we're to pick up the crap when they fail -- and building giant sucking machines upon quaky foundations leads us (always) to just that: regular clean-up of the diapers).

I'm talking from a framework that is outside the crappy part, folks. The financial industry does not want to look at matters from that perspective - it's too much fun rolling in the dough as is happening now with Ben's input (and largess).

---

That lead-in touched on one type of hell. Others are there and abound. One example is the credit handling via the Big-3 (Equifax, et al). Just recently, I ran across a case where someone is seen as dead by these Big-3 (idiots?). The reason is that one creditor reported the guy as such. What had happened is that the guy's wife died. In the process of notifying creditors of such, one of them took the person who was deceased to be the guy, not his wife. From that little thing ensued turmoil that has lasted months.

I talked to one of the Big-3 today. They can see that they're getting reports monthly from this guy's creditors about his activity. The account at the one who has him dead had been inactive for a long while; so, there was no activity to report there anyway.

In terms of process for the user, this Big-3 member ought to be able to let the guy dispute the error on-line. But, they won't do that without him proving who he is (soc sec card, et al). You know why this is stupid? The guy is a Viet Vet, was born here, lived here, paid taxes here, raised his kids here, and so forth. Too, he's  getting a Soc Sec check every month. The bank that gets that deposit knows this. Do they help the guy? No, they say that the Big-3 drive things.

Okay, Big-3, and bosses thereof. If you are going to be so central, should you not do it in a user-friendly manner that is fair, secure, and robust? (Now, all of you wags that are rolling on the floor, behave yourselves - they, the Big-3, cannot be total idiots - after all, they did get themselves a shared monopoly) Where the heck is the Consumer Financial Protection Agency (Note: 05/30/2013 - they never responded to me on FB -- usual government modus operandi?)?

---

You see, the whole thing harks back to the time when people believed what the computer said. That went on for awhile. Computers don't error, was the thought. Then, there was the realization of garbage in/garbage out. That is, junk begets junk. Don't laugh, folks. That forward step took awhile.

Now, it seems, that we're back to the belief stage. As in, the computer is the reality. It's a map/territory problem. Why this fall back? Complication, essentially. This will be a central theme to expand upon here. As things mix up, it causes so many to put their heads into the sand (do what the "man" says).

Aside: If it is not obvious, note that I've been in this industry for awhile in roles that were multiply varied, multi-disciplined, and, for the most part, of highly technical focus - with some back slapping as is the want of the likes of Jamie, and his ilk. We're in deep doo-doo, now. The kids (Zuck and the like - keep putting out things that flash - what is their basis? -- oh, I don't need to know, you say?) are perturbing things in ways that will have future implications. Singularity potentials are piling up (see Remarks 05/21/2013).

Mind you. There has been real progress (we'll go into that, too). After all, a lot of good comes from the networking methods, the cloud, and such.

---

For many, all of the flash and toys are entrancing (hence, zombies and more). Yet, you would expect, for these, some maturing event, at some point, unless they're completely washed out (possible as we have seen with drugs that alter the body's workings too far). Others have already seen, and experienced, the hell.

But, we could say that it's more like purgatory (look it up) at this point. The hell will result if matters continue to de-evolve as they are.

What do I mean? You know why the web was labeled wild west early on? What was the wild west? You know, too, that it's the largest-held romantic view of the US's history. Who doesn't seem to want to be a cowboy? Not all of us; we ask for acknowledgement the rights of the Natives who were here before. The thing was that misfits, a lot of times, from the east came out here and shot up the place. Law and order was not the norm. It took awhile for this to be established.

Forgetting the conflict with the Natives, when did law and order get set here in the West? Pinpointing around 1900 would be pushing it. We could probably point to the period after WWI and before WWII. Now, at what point is the "wild west" of the web? I don't see us further than right after the Civil War. In fact, have we not even had the Civil War (if you must, think of the free vs not conflict as an analog)?

From whence would come some type of structure and security?

---

With the Big-3, we have them pulling together stuff on us. For those of us who can, we can monitor their activity. Many cannot. Too, though, they do idiotic things like this deceased error. Actually, they ought to offer the guy a membership (30 days would do - or more until errors were properly handled) with which he could challenge their errors.

Remarks:

07/26/2015 -- This has had some recent reads. Lots going on, including poster boys coming out of the woodwork. We intend to get back to this topic: consumer as central to things economic (metaphysically sound).

10/20/2013 -- As of a couple of weeks ago, Equifax seemed to have caused another problem. Idiots. This type of thing, folks, foretells dire consequences for the ordinary populace. That is, entrapped by stupidly developed and released systems will be a common state.

07/08/2013 -- The bank responded to the CFPB query and changed their database. In June. The Big-3? For this little error, they say 90 days. Let's look at what needs to be done with computationally driven systems and processes.

06/04/2013 -- Last week, when the Big-3 problem was first looked at, I sent a note to the bank, Elizabeth Warren, and the CFPB (which is a new organization). I heard from the bank's PR people fairly quickly which is to be expected. Just today, a week later, heard from the CFPB. They sent information about their complaint process. Elizabeth? Nary a peep, yet.

06/03/2013 -- There is a log of activity the past week, on FB.  https://www.facebook.com/jmswtlk/posts/10151477999845847  It's funny about Equifax. I've been trying to raise them via FB, but they haven't made a peep. You see, they could override the death entry and allow the guy to get on-line with their system. We tried this the other day. On result? The Equifax computer system sent a notice about a credit card being renewed after we tried to sign in the guy as a new member. That is, the database sees the activity; the humans only look at the fact of the death. Why? Well, they do have their jobs on the line if they make an error. Too, the process might be too rigid; that is, where some common sense (experience?) might understand an error and suppress it, then it ought to be allowed. Of course, with suitable documentation to allow re-trace (and further correction, even a back-out). Methinks that those who do logic, and mathematics, many times have an unrealistic belief in their prowess (if only they knew --- by the way, singularities, again, are the key item in this and related cases). And, their poor users bear the cost and the pain. ... We'll get back to this (if you're so smart, why aren't you rich?).

06/03/2013 -- On Friday, it was determined that Capital One/ HSBC has sat on paperwork for four months. That is, the error was done by HSBC in Oct, 2012 (erroneous reporting to the Big-3); the error was noticed in Jan, 2013; the error was brought to the attention of Capital One (by mail) in Jan, 2013. It was the end of May before the error was noticed by HSBC, via to a phone call.

05/31/2013 -- The focus might have to be on the Big-3. In cases like this, they ought to allow an override that is quick, as is necessary for the computational age. For some reason, they like to lumber along. Did some bureaucrat lead them to believe this? Now, quick changes can create a hellish situation. Yet, many times, an override by a human will resolve a hellish situation. Both a paradox and a dilemma. The irritating thing is that a little bit of garbage in a database in having real world effect. An override (are you listening Equitfac, etc.) would allow change of that piece of crap, with an explanation, and rationale. Okay? In my case, I'm a member of Equifax (have been since 2005). They know who the heck I am. If I say that someone is next to me and is undead, then my word ought to be taken (verified later, okay?) so as to free up the bottleneck. Sheesh.

05/31/2013 -- When one considers the cost of the necessary framework, that would allow security and sustainability, people have kicked the thing around (WSJ talked about how to control the idiot of North Korea; what about reining in the financial manipulators?). However, the minds are so entrenched in this illusion about which Marx laughed (fictitious capital, for one), it's hard to express a rational stance on the matter. You see, people are experimented with big time. It's really analogous to that concept so familiar from warring, namely cannon fodder. We have our great leaders mouthing platitudes about how they want to help the little guy; most of their efforts seem to move more toward entrapment; take droning (in other than a defensive mode) if you need something to grasp here).

View from 2008 

05/30/2013 -- A case in point about off shoring, saw yesterday that some mortgage foreclosure work was being sent to India (Tata was one contractor). It was said that this work was too tedious for Americans. Now, these foreign brains weren't going to make judgments (Tata's words, paraphrased). No. The thing was to get all the paperwork together, verified, and provided to a banker in the US who would do the dirty deed. That whole rationale was bothersome. For one, those there in India only need to look outside their office (even if it's isolated in a privileged environment) to see their 3rd world fellow citizens. Of course, doing American work lifted out a few. But, the majority? Besides, these types of roles could very well be performed by people here. ... Not anti-outhousing, rather putting this here as we'll have to address the whole phenomenon while looking at foundation'al issues.

05/29/2013 -- Singularity? Yes, this will be an important subject. You know what? I don't think that Jamie (and his ilk -- who, by the way, was vindicated according to the WSJ) would understand the concept. The fat whale (whatever) was a small incident compared to that which we need to put our attention.

Modified: 07/26/2015

Consequences vs scare tactics

Moral: Wherein we look at a situation's potential reflection on the ca-pital-sino nature of our economic playing field.

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Toyota is having a problem that may revolve around drive by wire. Aviation has been doing 'fly by wire' for some time. But, those systems are scrutinized more than we see with the automobile.

Why is driving taken so slightly? Some concept of a right to drive (we know that is not true from the training manuals)? It's so easy: just gas, steer, brake?

As a regular pedestrian would tell us, the mechanical beasts roaming our streets are becoming more and more mindless since there seems to be a zombie behind the wheel. Too, the vehicle has taken more and more claim for rights of way. Actually, it may be that the pedestrian is deemed an unwanted intrusion, not unlike a bug on the windshield, on some idyllic mindset that is behind the bliss of texting.

Perhaps Toyota will lead the way in the discussions that are needed. We put people behind the wheel, with some type of perceived constitutional right in mind, that they are the king of the road. Oh, perhaps the auto allows the normal person to experience the CEO's state of privilege.

So, what does this have to do with the ca-pital-sino? Well, the apparatus that we've developed for the market is not unlike a vehicle. What type is it? Ah, we could use several types in a description. Buffett has already used WMD (if you need to know, think Iraq) for portions.

Some may be a little putter upon which we've piled a bunch of fat cats. No wonder it's sputtering.

Whatever the type, it can roll (ought we use careen?) along at a high rate of speed without any control. Oh, yes, Big Ben has his little knobs. Are they effective, big guy?

We need to stop the thing and put governors on it along with a bunch of improved sensors and feedback systems. Oh, what we see now with all the tubes and charts and talking heads isn't doing the job?

Those seem to be mainly for glorification, like a NASCAR ad. How much is not under scrutiny? Can anyone tell us a reasonable number for 'value' at any point?

Just like we expect that an auto will use established roads, and follow rules, we need the same for any economic system. That the capitalism, of Adam, has morphed to a maniacal ideology is indicative that we've screwed up somewhere.

How to get back to a better basis is the question.

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Now, on scare tactics. The markets are down today. We find ourselves confounded, since both Big Ben and the Pres spoke.

The talking voice, quoting Timmy, on the tube today said, without the bailout, the unemployment would be 25%. Ah, is that so, governor? It's 17% now anyway.

The above use of the drive by wire as a metaphor for the problems that we face with fat cats, and the financial system, is tighter than we would probably allow ourselves to see.

Yet, consequences usually fall to the small guy, such as the cannon fodder of years of old. T'aint necessary.

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The NYTimes reviews a funny book about the financial crisis. I.O.U.

Remarks:

01/22/2013 -- USA Today story on settlements. From three years ago, lest we forget.

02/08/2011 -- There was a report today concerning a study on the SUA problem that has been going on quietly. More news will be coming later when the report is technically analyzed.

09/28/2010 -- It nice to see the IEEE weigh in. Notice: sensors galore, drive in the loop, ...

02/08/2010 -- More expert opinion.

02/05/2010 -- Nader's opinion. Also, software and cars. And, what's the quality control? Note this from an expert's look,

02/01/2010 -- Experts on these types of things.

01/29/2010 -- Defense of Toyota.

01/29/2010 -- As said before, there is no reason to knock only Toyota in these regards (look at the long recall lists over the years - Toyota hasn't been there regularly - as well, perhaps Toyota can lead the industry in continual improvement - to more than just the bottom line and the fat cats' pockets). The dbw discussion could just broaden to cover the fact that systems are more complicated and electrically boosted. Note today's Honda recall. There is no need to go through the long list of recalls except, perhaps, to categorize and count. The basis for continuing problem will be embedded logic as its prevalence can only increase due to technology. Who knows what we'll see with the hybrids and electric cares. That's the way it goes, folks, when we deal with our artificial servants.

And, using these little quirks of designed projects as an analogy for the large scope of economics is not far off base. All the gaming that we see financially has been computationally derived from mindsets that are both morally and ethically disadvantaged. Oh, these folks are brilliant and our best and brightest? Give us a break!

01/29/2010 -- Ben was confirmed today for his second term. Perhaps, now that he's not following another, doesn't have to worry about the next time (not for a few years), is independent, and continues to want to do a good job, perhaps he'll raise the rates and listen to the little people, even though the Fed Reserve was set up for the bankers (fat cats, by definition?). This is your chance to set history straight, Ben.

We'll start a new series, soon, that will look at the Fed, its place in history, bankers (can we ever get away from them?), the current situation, how we got here (thanks, Ben, for sleeping), how Ben woke up and panicked early, and much more. Thanks, Congress, we have several years to do this analysis. Looking forward to it.

Modified: 01/22/2013