Is recovery.gov not helpful enough? Try Stimulus Watch!
Should I worry that even these two websites are an example of a private effort (four people) doing a better job than a vague and unhelpful government attempt?
UPDATE: More here about how Congress cannot track the simulus money well.
UPDATE: In early May we learn that the Federal government will not have its data until October, that even then the data only examines state and city (not contracting company), and that recovery.gov will not be complete until Spring 2010.
UPDATE: Also in early May someone prepares a chart showing that the economy is still behaving as if there were no stimulus plan.
UPDATE: In late May, news of no news from New Hampshire.
UPDATE: At the end of June, the way to count "jobs created or saved" is unveiled, and is an Orwellian delight of misdirection and blame-passing
UPDATE: Also at the end of June, a look at jobs, gender, and stimulus spending.
Wednesday, February 25, 2009
Crisis Enablement
I wrote earlier about the financial crisis blame. Certain people allowed a natural credit bubble to grow to unnaturally monstrous proportions.
A related but very different issue is what enabled the problem to grow--what blinded everyone to what was happening? My wife just sent me a great article that explains how the liquidity crisis came about.
The culprit was a math formula.
More specifically, too many people used the Gaussian copula function in ways for which it was never intended.
Remember, formula's don't kill economies, people do.
UPDATE: More on how CDOs enabled a mortgage crisis to expand into a liquidity crisis. And an article about just how much deregulation was to blame.
A related but very different issue is what enabled the problem to grow--what blinded everyone to what was happening? My wife just sent me a great article that explains how the liquidity crisis came about.
The culprit was a math formula.
More specifically, too many people used the Gaussian copula function in ways for which it was never intended.
Remember, formula's don't kill economies, people do.
UPDATE: More on how CDOs enabled a mortgage crisis to expand into a liquidity crisis. And an article about just how much deregulation was to blame.
Discipline and Mentoring, Part One: Discipline
Smiley is now old enough to enjoy being trained. I should write an essay that shares what I know about training and correcting young children.
This topic has no "correct" or "best" answers. Other parents will surely disagree with some of my philosophy. My main hope in sharing is to put forth a careful set of ideas and vocabulary. This blog is, after all, primarily to help me process my own thoughts.
What did I mean when I said that Smiley is "old enough to enjoy being trained"?
I managed to catch the key behavior on video this morning. During the first few moments of this video he reaches for my computer cord shakes his head. (I only caught two repetitions on video, but he had been doing this more times.)
I recently switched from keeping my computer and its cord (oh, the cord!) out of his reach to training him not to touch it. When he reaches out to it, I shake my head "no" as part of the training.
Now Smiley knows that he is not allowed to touch these. He enjoys knowing this rule. So he rides his scooter up to these forbidden objects, reaches partway out to the cord, and stops himself with his own head shake. When he tires of this game he moves on to something else, happy and conversational.
At ten months he probably does not want many rules. But now he is old enough to learn about the stove, the camera, and the indoor plants. Training is appropriate when stubbornness and danger (danger to Smiley or to something very breakable) might mix.
What is training?
Training is not correction. I'll discuss correction later.
Training begins by putting Smiley into a constructed situation. I set him by my keys. Previously they have always been out of reach. Smiley does not know he is not allowed to touch them. I expect he will reach out for them. This is an unfair test; I expect him to fail.
Training is arranged. The area is free of distractions. I wait until Smiley is at his best: not tired or fussy.
Training includes a gesture, a word or phrase, and small discomfort. When he reaches for the keys I shake my head "no", say "hold", and either block his hand or very lightly swat it. Smiley is stubborn and tries again. After all, perhaps the prohibition is only momentary?
Training starts calm. If I block his hand I do so with the minimal needed effort. If I swat his hand I do so with a very soft touch, less than a tap. Either is meaningful only in its significance, not in force; I initially move slowly, almost lazily. Neither reaction would be immediately effective.
Training remains serene. When Smiley reaches out a second time he is confused, and my reaction repeats as before. By the third time he realizes the keys are prohibited and has become stubborn. Now my reaction must match his mood. If he becomes frustrated I must not block his hand (which would keep his focus on his frustration rather than the rule) and switch to a swat. If he is not frustrated I block his hand since I don't like to swat him. My gesture and voice retain their initial calm, but if he moves more forcefully I do too; more significantly my reaction time quickens. After a few repeats I am reacting almost instantly and with force he notices. His stubbornness gives up. This is not a game, it is too uncomfortable.
Training is patient. He has learned the rule. But was reaching with his left hand. Perhaps he will be allowed to reach take the keys with his right hand instead? Or lean forward to lick them? With each new try we start over from the beginning. Eventually he runs out of alternatives and goes to do something fun.
Training is anti-social. Smiley and I were merely two roles in an artificial situation moving towards an inevitable destiny. The training techniques are the same methods I once used to use to train mice or horses; in some small way Smiley feels that I was not treating him as himself, not as a person. So after the training I give him lots of loving attention. He is not in need of comfort or soothing since none of his discomfort or frustration during training was at all lasting. But he needs me to be the daddy and him to be the baby, socially in those roles.
In training have not crushed his will. He makes every choice, even when to move along to some other activity. All he learns is a new rule, with a refresher that I am more patient and stubborn than he. He remembers the rule but the training experience is soon forgotten.
At an early age I trained Smiley to do two things. He stays on his back when on his pink towel on the bathroom counter. He stays on his back when on his changing table. (Well, only most of the time for the latter.)
That very early training was done for the sake of his safety. He did not notice my gesture. He barely noticed my phrase ("don't roll, stay on your back, please"). He only knew that when he tried to roll I would hold him in place by his hips a little bit longer than necessary to prevent the roll. That "little bit longer" was the emotional discomfort portion. He did not like it, and soon was trained.
Training is only appropriate with your own children. Currently laws prohibit adults from causing almost any kind of physical discomfort to someone else's child, no matter what agreement the adults believe they have made. Although it is possible to train using only emotional discomfort this is so much less efficient it can become cruel to the child.
Must training be limited to negative reinforcement? Hopefully it is limited in this way because the young child has no favorite thing withheld from his or her normal routines. If we were training an animal we would use as positive reinforcement some favorite food or treat. But, to me, it seems wrong to withhold from a child a favorite toy, food, or type of parental attention and reserve it for use as positive reinforcement during a training session. The necessary negative reinforcement is so minor and temporary that overall the child will have a more enjoyable day with otherwise unrestricted access to his or her favorite things.
For most children, only train one rule at a time. Until that rule has been well learned, for everything else continue keeping items out of reach and using redirection.
Training, as I have defined it, is completely different from teaching. It is in many ways the opposite. Here is an example to highlight the distinctions.
When I taught preschool on the first day the students were taught how to form a nice, straight line by the classroom door. This took a long time. Many of them had never before heard of the concept and had no idea what I was asking of them.
The other adult and I modeled standing still, facing the door, behind someone else, etc. Other students were gradually invited in to the model line. When we finally had all the students in a straight line I took a photograph.
Then, one by one, we invited each student to show one way to not be in a nice, straight line and hold that pose. Then I took another photograph.
Both photographs were quickly printed and passed around during circle time. We reviewed how to form a nice, straight line. All the students got to laugh at their antics in the second photograph. Both photographs were then taped to the inside door frame.
From then on, when it was time to line up, usually all I had to do was point at the second photograph. Most students would straighten up. Distracted neighbors would get reminded. Soon the line was nice and straight. Then I would point to the first photograph, smile, and either clap, do an ASL clap, or give a thumbs up.
Teaching is social. All involved maintain their personalities. It involves many words, not a single gesture and phrase. It uses positive reinforcement, not negative. The teacher answers the learner's questions or difficulties, not the learner's stubbornness and frustration. It often happens spontaneously with a "teachable moment", not in a previously arranged setting.
The end result of teaching should be a new skill and a happy memory, not a new rule and a forgotten experience.
Smiley is still too young for successful teaching. I try anyway because we both enjoy it.
This week he is starting to learn to use a spoon. For months he has had his own spoon to hold when we fed him. Now I often hold a bowl of food within his reach and guide his spoon-wielding hand to scoop some food. On rare occasions he will put the spoon in his mouth (upside down). Slightly more often he will grab the food off the spoon with his other hand. Usually he ignores the food on his spoon and wants to either scoop more or grab the bowl with his free hand.
It will probably be weeks before he can use a spoon by himself, and weeks after that before I do not need to hold the bowl. Meanwhile, the teaching is still fun even without success.
How about correction? This is also, in many ways, the opposite of training.
I use the word "correction" to refer to what happens between stopping misbehavior and redirecting the young child. Often nothing is in the between area, especially if the environment is well prepared.
(Imagine Smiley reaches for something at a store. I say, "Smiley, that's not for you, see those lights?" Imagine he stops reaching and focuses on something else--maybe even the lights I was pointing out. According to my vocabulary, that sentence was enough to both stop and redirect, so there was no need for correction.)
Correction usually happens when the child is tired or cranky or otherwise not at his or her best. Happy and rested young children are typically easy to stop and redirect.
Correction begins at an unprepared time and setting. If possible, quickly move the child to another quiet place. The change of location is itself a bit of a wake up call. Also, having the object or person previously focused on out of sight helps the child shift focus to you.
Correction usually begins with a question. This question prompts the child to focus on himself or herself, rather than the other person or object. "Why are you upset?" "Why do you want that?" "Did you know you are acting like a baby?"
Too often adults begin with a counterproductive question or statement. It wastes time to keep the child focused on the other person or object. ("Why did you hit her?" "It's not your turn to play with that.")
It is also counterproductive to give warnings. What adults call "warnings" children think of as "freebies". A few situations really can be resolved with a repeated request, as when a normally obedient child is momentarily distracted. But almost always it is better in the long run to do an unnecessary session of correction than to risk a child getting used to freebies.
One last benefit of having moved the child is that he or she is then more like to answer the question. The likelihood of sullen defiance is much lower in the hallway then at the scene of contention.
The child's answer to the initial question is usually irrelevant because children are not mature enough for sufficient self-reflection. The child claims to be upset because someone else was mean, but actually the child has been edgy and fragile all day because of lack of sleep or a pet's recent death. The child claims she wants a certain book because of the story, but what she really wants is to interrupt a friend to demonstrate a higher pecking order rank. And so on.
But whatever the answer, now the child is focusing on himself or herself, and ready to listen. Shift the focus to previously established standards. Walking feet indoors. Hands are for helping. Hitting means a time-out. Keep a dialogue going, focused on the child and the standards, until the child recognizes his or her wrongdoing.
Next, process the guilt. An apology is ideal. With children younger than second grade a vicarious apology also works. ("Are you ready to tell her you are sorry? No? Then I will. [Go back to the room.] Kandice, I'm sorry Steven hit you. I'm saying sorry for him. Now you two are friends again.") It's almost magic. Immediately the children switch from being too upset to talk to each other to playing happily.
If an apology is not appropriate something else should happen to process the guilt. "You used running feet indoors, so we need to leave this store for a while." It may be useful to ask the child what he or she thinks should be done to make things right.
Once the child has seen the guilt arrive and depart he or she is almost always ready for redirection. The correction session is complete. But it should be reviewed in a positive way at the end of the day. "Remember when you hit Kandice, and there was an apology, and you played happily after? That was well done. I'm glad you can be a friend after a problem."
Sometimes a correction session dead-ends. Most often this happens when a child is too weighted down by something to recognize or care about the guilt coming and going. The weight could be any hurt: a headache, a lost favorite toy, overhearing parents argue, a grandparent has died. Then the child needs one-on-one time with an adult. Postpone the correction session.
Smiley is clearly not yet verbal enough for correction as I have defined it. He just gets redirection. For example, he is allowed in the kitchen when on his scooter but not when crawling (when crawling he tries to play with our kitchen mats, which may be hiding a piece of dropped food that could be a choking hazard). When he does try to crawl into the kitchen he is told this "rule" as we pick him up and either move him to another room or put him on his scooter, but he does not understand, so we make no attempt to put anything between the stopping him and the redirecting him.
UPDATE: This post is now part one of a three-part series. Part two is here. Part three is here.
This topic has no "correct" or "best" answers. Other parents will surely disagree with some of my philosophy. My main hope in sharing is to put forth a careful set of ideas and vocabulary. This blog is, after all, primarily to help me process my own thoughts.
What did I mean when I said that Smiley is "old enough to enjoy being trained"?
I managed to catch the key behavior on video this morning. During the first few moments of this video he reaches for my computer cord shakes his head. (I only caught two repetitions on video, but he had been doing this more times.)
I recently switched from keeping my computer and its cord (oh, the cord!) out of his reach to training him not to touch it. When he reaches out to it, I shake my head "no" as part of the training.
Now Smiley knows that he is not allowed to touch these. He enjoys knowing this rule. So he rides his scooter up to these forbidden objects, reaches partway out to the cord, and stops himself with his own head shake. When he tires of this game he moves on to something else, happy and conversational.
At ten months he probably does not want many rules. But now he is old enough to learn about the stove, the camera, and the indoor plants. Training is appropriate when stubbornness and danger (danger to Smiley or to something very breakable) might mix.
What is training?
Training is not correction. I'll discuss correction later.
Training begins by putting Smiley into a constructed situation. I set him by my keys. Previously they have always been out of reach. Smiley does not know he is not allowed to touch them. I expect he will reach out for them. This is an unfair test; I expect him to fail.
Training is arranged. The area is free of distractions. I wait until Smiley is at his best: not tired or fussy.
Training includes a gesture, a word or phrase, and small discomfort. When he reaches for the keys I shake my head "no", say "hold", and either block his hand or very lightly swat it. Smiley is stubborn and tries again. After all, perhaps the prohibition is only momentary?
Training starts calm. If I block his hand I do so with the minimal needed effort. If I swat his hand I do so with a very soft touch, less than a tap. Either is meaningful only in its significance, not in force; I initially move slowly, almost lazily. Neither reaction would be immediately effective.
Training remains serene. When Smiley reaches out a second time he is confused, and my reaction repeats as before. By the third time he realizes the keys are prohibited and has become stubborn. Now my reaction must match his mood. If he becomes frustrated I must not block his hand (which would keep his focus on his frustration rather than the rule) and switch to a swat. If he is not frustrated I block his hand since I don't like to swat him. My gesture and voice retain their initial calm, but if he moves more forcefully I do too; more significantly my reaction time quickens. After a few repeats I am reacting almost instantly and with force he notices. His stubbornness gives up. This is not a game, it is too uncomfortable.
Training is patient. He has learned the rule. But was reaching with his left hand. Perhaps he will be allowed to reach take the keys with his right hand instead? Or lean forward to lick them? With each new try we start over from the beginning. Eventually he runs out of alternatives and goes to do something fun.
Training is anti-social. Smiley and I were merely two roles in an artificial situation moving towards an inevitable destiny. The training techniques are the same methods I once used to use to train mice or horses; in some small way Smiley feels that I was not treating him as himself, not as a person. So after the training I give him lots of loving attention. He is not in need of comfort or soothing since none of his discomfort or frustration during training was at all lasting. But he needs me to be the daddy and him to be the baby, socially in those roles.
In training have not crushed his will. He makes every choice, even when to move along to some other activity. All he learns is a new rule, with a refresher that I am more patient and stubborn than he. He remembers the rule but the training experience is soon forgotten.
At an early age I trained Smiley to do two things. He stays on his back when on his pink towel on the bathroom counter. He stays on his back when on his changing table. (Well, only most of the time for the latter.)
That very early training was done for the sake of his safety. He did not notice my gesture. He barely noticed my phrase ("don't roll, stay on your back, please"). He only knew that when he tried to roll I would hold him in place by his hips a little bit longer than necessary to prevent the roll. That "little bit longer" was the emotional discomfort portion. He did not like it, and soon was trained.
Training is only appropriate with your own children. Currently laws prohibit adults from causing almost any kind of physical discomfort to someone else's child, no matter what agreement the adults believe they have made. Although it is possible to train using only emotional discomfort this is so much less efficient it can become cruel to the child.
Must training be limited to negative reinforcement? Hopefully it is limited in this way because the young child has no favorite thing withheld from his or her normal routines. If we were training an animal we would use as positive reinforcement some favorite food or treat. But, to me, it seems wrong to withhold from a child a favorite toy, food, or type of parental attention and reserve it for use as positive reinforcement during a training session. The necessary negative reinforcement is so minor and temporary that overall the child will have a more enjoyable day with otherwise unrestricted access to his or her favorite things.
For most children, only train one rule at a time. Until that rule has been well learned, for everything else continue keeping items out of reach and using redirection.
Training, as I have defined it, is completely different from teaching. It is in many ways the opposite. Here is an example to highlight the distinctions.
When I taught preschool on the first day the students were taught how to form a nice, straight line by the classroom door. This took a long time. Many of them had never before heard of the concept and had no idea what I was asking of them.
The other adult and I modeled standing still, facing the door, behind someone else, etc. Other students were gradually invited in to the model line. When we finally had all the students in a straight line I took a photograph.
Then, one by one, we invited each student to show one way to not be in a nice, straight line and hold that pose. Then I took another photograph.
Both photographs were quickly printed and passed around during circle time. We reviewed how to form a nice, straight line. All the students got to laugh at their antics in the second photograph. Both photographs were then taped to the inside door frame.
From then on, when it was time to line up, usually all I had to do was point at the second photograph. Most students would straighten up. Distracted neighbors would get reminded. Soon the line was nice and straight. Then I would point to the first photograph, smile, and either clap, do an ASL clap, or give a thumbs up.
Teaching is social. All involved maintain their personalities. It involves many words, not a single gesture and phrase. It uses positive reinforcement, not negative. The teacher answers the learner's questions or difficulties, not the learner's stubbornness and frustration. It often happens spontaneously with a "teachable moment", not in a previously arranged setting.
The end result of teaching should be a new skill and a happy memory, not a new rule and a forgotten experience.
Smiley is still too young for successful teaching. I try anyway because we both enjoy it.
This week he is starting to learn to use a spoon. For months he has had his own spoon to hold when we fed him. Now I often hold a bowl of food within his reach and guide his spoon-wielding hand to scoop some food. On rare occasions he will put the spoon in his mouth (upside down). Slightly more often he will grab the food off the spoon with his other hand. Usually he ignores the food on his spoon and wants to either scoop more or grab the bowl with his free hand.
It will probably be weeks before he can use a spoon by himself, and weeks after that before I do not need to hold the bowl. Meanwhile, the teaching is still fun even without success.
How about correction? This is also, in many ways, the opposite of training.
I use the word "correction" to refer to what happens between stopping misbehavior and redirecting the young child. Often nothing is in the between area, especially if the environment is well prepared.
(Imagine Smiley reaches for something at a store. I say, "Smiley, that's not for you, see those lights?" Imagine he stops reaching and focuses on something else--maybe even the lights I was pointing out. According to my vocabulary, that sentence was enough to both stop and redirect, so there was no need for correction.)
Correction usually happens when the child is tired or cranky or otherwise not at his or her best. Happy and rested young children are typically easy to stop and redirect.
Correction begins at an unprepared time and setting. If possible, quickly move the child to another quiet place. The change of location is itself a bit of a wake up call. Also, having the object or person previously focused on out of sight helps the child shift focus to you.
Correction usually begins with a question. This question prompts the child to focus on himself or herself, rather than the other person or object. "Why are you upset?" "Why do you want that?" "Did you know you are acting like a baby?"
Too often adults begin with a counterproductive question or statement. It wastes time to keep the child focused on the other person or object. ("Why did you hit her?" "It's not your turn to play with that.")
It is also counterproductive to give warnings. What adults call "warnings" children think of as "freebies". A few situations really can be resolved with a repeated request, as when a normally obedient child is momentarily distracted. But almost always it is better in the long run to do an unnecessary session of correction than to risk a child getting used to freebies.
One last benefit of having moved the child is that he or she is then more like to answer the question. The likelihood of sullen defiance is much lower in the hallway then at the scene of contention.
The child's answer to the initial question is usually irrelevant because children are not mature enough for sufficient self-reflection. The child claims to be upset because someone else was mean, but actually the child has been edgy and fragile all day because of lack of sleep or a pet's recent death. The child claims she wants a certain book because of the story, but what she really wants is to interrupt a friend to demonstrate a higher pecking order rank. And so on.
But whatever the answer, now the child is focusing on himself or herself, and ready to listen. Shift the focus to previously established standards. Walking feet indoors. Hands are for helping. Hitting means a time-out. Keep a dialogue going, focused on the child and the standards, until the child recognizes his or her wrongdoing.
Next, process the guilt. An apology is ideal. With children younger than second grade a vicarious apology also works. ("Are you ready to tell her you are sorry? No? Then I will. [Go back to the room.] Kandice, I'm sorry Steven hit you. I'm saying sorry for him. Now you two are friends again.") It's almost magic. Immediately the children switch from being too upset to talk to each other to playing happily.
If an apology is not appropriate something else should happen to process the guilt. "You used running feet indoors, so we need to leave this store for a while." It may be useful to ask the child what he or she thinks should be done to make things right.
Once the child has seen the guilt arrive and depart he or she is almost always ready for redirection. The correction session is complete. But it should be reviewed in a positive way at the end of the day. "Remember when you hit Kandice, and there was an apology, and you played happily after? That was well done. I'm glad you can be a friend after a problem."
Sometimes a correction session dead-ends. Most often this happens when a child is too weighted down by something to recognize or care about the guilt coming and going. The weight could be any hurt: a headache, a lost favorite toy, overhearing parents argue, a grandparent has died. Then the child needs one-on-one time with an adult. Postpone the correction session.
Smiley is clearly not yet verbal enough for correction as I have defined it. He just gets redirection. For example, he is allowed in the kitchen when on his scooter but not when crawling (when crawling he tries to play with our kitchen mats, which may be hiding a piece of dropped food that could be a choking hazard). When he does try to crawl into the kitchen he is told this "rule" as we pick him up and either move him to another room or put him on his scooter, but he does not understand, so we make no attempt to put anything between the stopping him and the redirecting him.
UPDATE: This post is now part one of a three-part series. Part two is here. Part three is here.
Tuesday, February 24, 2009
Contrary Opinion
An Ecomony with a Bad Flavor
I just mentioned that I have worries about the economy, despite my attempts to report the good news many people (such as my math students) are not hearing.
My worries stem from an increase of inept government regulation.
Regulations were the primary cause of this recession. Yet the same members of Congress that did so much harm are now leading efforts at recovery. Bank holding companies gave lots of money to these men and wanted help in return, so Congress helped these holding companies instead of the banks. and might do much more harm. In a few key Democratic states a few people need help with mortgages and Congress again acts causing trouble.
Beyond this cronyism, the government is using the recession to interfere in health care, welfare reform, and job dependence. The government and media are also lying about economic history.
This is not what people want or voted for.
Although I personal favor small-government I am not worried by all big-government trends. This country has survived and prospered within those.
But inept big-government trends caused this recession, and fixing the Entitlement Crisis will require skilled politicians. I have worries because there seems to be a lot more cronyism and meddling and foolishness than skillful fixing.
Too much is at stake and bad politics is too divisive.
(Many links from Glenn Reynolds and Greg Mankiw. Thanks!)
UPDATE: The president's address to Congress today was dishonest in placing blame for this recession in all the wrong places. Dependence on foreign oil? The cost of health care? Inadequate public schools and higher education? National debt? Sure, these are problems, but none of them caused this recession. Furthermore, his sentences
My worries stem from an increase of inept government regulation.
Regulations were the primary cause of this recession. Yet the same members of Congress that did so much harm are now leading efforts at recovery. Bank holding companies gave lots of money to these men and wanted help in return, so Congress helped these holding companies instead of the banks. and might do much more harm. In a few key Democratic states a few people need help with mortgages and Congress again acts causing trouble.
Beyond this cronyism, the government is using the recession to interfere in health care, welfare reform, and job dependence. The government and media are also lying about economic history.
This is not what people want or voted for.
Although I personal favor small-government I am not worried by all big-government trends. This country has survived and prospered within those.
But inept big-government trends caused this recession, and fixing the Entitlement Crisis will require skilled politicians. I have worries because there seems to be a lot more cronyism and meddling and foolishness than skillful fixing.
Too much is at stake and bad politics is too divisive.
(Many links from Glenn Reynolds and Greg Mankiw. Thanks!)
UPDATE: The president's address to Congress today was dishonest in placing blame for this recession in all the wrong places. Dependence on foreign oil? The cost of health care? Inadequate public schools and higher education? National debt? Sure, these are problems, but none of them caused this recession. Furthermore, his sentences
In fact, a failure to act would have worsened our long-term deficit by assuring weak economic growth for years.and
But while the cost of action will be great, I can assure you that the cost of inaction will be far greater, for it could result in an economy that sputters along for not months or years, but perhaps a decade.flatly contradict the CBO analysis. He continues the save or create hand-waving. His explanation about banks not lending ignores the above-linked information about bank holding companies and banks. He wants to make hybrid car batteries here? As I concluded before, I don't mind a "more strings attached" attitude if it is honest and skillful, but what I am seeing instead is our president following dishonest and misguided congressional leaders.
Debt and GDP
Strange. In a previous post I mentioned the current national debt as a percentage of GDP was about 74%.
Here is from the Telegraph:
The current U.S. GDP is 14.4 trillion. The national debt is now 10.6 trillion, or 74% of the GDPI thought my math was correct and that I used reliable sources. But two articles say something very different.
Here is from the Telegraph:
Assuming deficit projections by the Congressional Budget Office (CBO) for the 2009 and 2010 fiscal years are right, and adding in the costs of the stimulus package, the bank rescue plan and borrowing costs, US public debt would rise from 41pc of GDP in September 2008 to about 70pc of GDP in September 2011 - roughly in line with Hungary's December 2008 ratio.Here is from the Wall Street Journal, in an article about how current spending is much more worrisome than current debt. (I point I have made.)
The current federal debt-to-GDP ratio is around 40%, well below the above-100% level at the end of World War II.How is my 74% figure incorrect?
More Economic Good News
I do have some worries, which will appear in a later blog post.
But sharing some economic good news is still nice. Overall the economy is healthier and "contracting at a slower pace" than a month or two ago.
But sharing some economic good news is still nice. Overall the economy is healthier and "contracting at a slower pace" than a month or two ago.
Saturday, February 21, 2009
Tango and Downtown
The Tango Center is in trouble.
This is currently the location where the swing dance group that my wife and I enjoy participating in meets. Finding a new location would not be too disappointing: the Tango Center is not really that great a facility.
But it would be a shame for downtown Eugene to lose this significant part of local culture.
This is currently the location where the swing dance group that my wife and I enjoy participating in meets. Finding a new location would not be too disappointing: the Tango Center is not really that great a facility.
But it would be a shame for downtown Eugene to lose this significant part of local culture.
An MP3 Player for Baby
Soon after Smiley was born I bought him an iPod Shuffle for the nursery. We already owned an old set of computer speakers that worked okay without being plugged in. The combination sat on top of his changing table so he could have soothing music before being put to bed.
We chose the iPod because it was reliable, not too expensive, and also could do an audiobook. (I would listen to an audiobook with headphones when I was feeding or soothing him. Audiobooks are skipped in "shuffle" mode. I sorted files by genre so it came up first in "play in order" mode.)
Now Smiley is old enough to enjoy music more and wants to play with whatever makes music. The most recommend MP3 player for babies is the SweetPea, but it currently costs $60.
My wife found a less expensive alternative. We bought a little speaker-system for the iPod ($17) and a waterproof camera bag ($12). The result is not as cute but works great and is half the cost.
Once he is old enough to not chew on everything we can stop using the bag. The little iPod and speaker-system should be useful for many years.
We chose the iPod because it was reliable, not too expensive, and also could do an audiobook. (I would listen to an audiobook with headphones when I was feeding or soothing him. Audiobooks are skipped in "shuffle" mode. I sorted files by genre so it came up first in "play in order" mode.)
Now Smiley is old enough to enjoy music more and wants to play with whatever makes music. The most recommend MP3 player for babies is the SweetPea, but it currently costs $60.
My wife found a less expensive alternative. We bought a little speaker-system for the iPod ($17) and a waterproof camera bag ($12). The result is not as cute but works great and is half the cost.
Once he is old enough to not chew on everything we can stop using the bag. The little iPod and speaker-system should be useful for many years.
Thursday, February 19, 2009
Local Wood
Last Friday ago I shared a video of Smiley on his new scooter. That was also a day when we had another cord of firewood delivered.
For anyone interested, here is the contact information...
Wood 'N Things (Wooden Toys)
Norm Webb
Springfield, OR
(541) 744-0299
Norm makes many children's toys besides the scooter. Smiley also has one of Norm's small dump trucks, a toy which satisfies both a desire to push and a desire to put things in and out of a container. Norm sells his toys at local crafters' markets and out of his home.
Hardwood Firewood
Gilbert Yearous
(541) 942-5873
Gilbert sells mixed hardwood for less than $200 per cord or fir for less than $150 per cord. His "cord" is larger than a true cord. The hardwood is exceptionally well-seasoned and burns well when our stove is set to the lowest air flow -- with his wood I only light the fire about once per week and just keep it simmering with a trickle of wood, and this produces enough heat. This is the wood we normally burn.
Fir Firewood
James Van Wormer
(541) 914-1072
James has an interesting setup. He buys kiln-dried, clean fir logs intended for companies that build log cabins. Another middle-man trucks these logs to him. He cuts them into firewood and sells them. The result is expensive fir ($200 per cord, for a true cord) but it burns like most hardwood. If I turn up the stove after dinner I can go to bed after switching to the lowest air flow confident that there will be hot coals in the morning. To heat the house requries medium air flow during the day, so I use up this wood faster. The wood is also completely clean: no bark, no bits, nothing on the carpets. If Gilbert is out of hardwood, I'll call James.
UPDATE: Norm and James have not responded to phone calls since 2010. I hope they are simply retired, and still happy and healthy. Gilbert still sells firewood but has slowed down his operation so much that he usually has a waiting list. My new source of firewood is Steve Wright, who sells madrone as blogged here.
For anyone interested, here is the contact information...
Wood 'N Things (Wooden Toys)
Norm Webb
Springfield, OR
(541) 744-0299
Norm makes many children's toys besides the scooter. Smiley also has one of Norm's small dump trucks, a toy which satisfies both a desire to push and a desire to put things in and out of a container. Norm sells his toys at local crafters' markets and out of his home.
Hardwood Firewood
Gilbert Yearous
(541) 942-5873
Gilbert sells mixed hardwood for less than $200 per cord or fir for less than $150 per cord. His "cord" is larger than a true cord. The hardwood is exceptionally well-seasoned and burns well when our stove is set to the lowest air flow -- with his wood I only light the fire about once per week and just keep it simmering with a trickle of wood, and this produces enough heat. This is the wood we normally burn.
Fir Firewood
James Van Wormer
(541) 914-1072
James has an interesting setup. He buys kiln-dried, clean fir logs intended for companies that build log cabins. Another middle-man trucks these logs to him. He cuts them into firewood and sells them. The result is expensive fir ($200 per cord, for a true cord) but it burns like most hardwood. If I turn up the stove after dinner I can go to bed after switching to the lowest air flow confident that there will be hot coals in the morning. To heat the house requries medium air flow during the day, so I use up this wood faster. The wood is also completely clean: no bark, no bits, nothing on the carpets. If Gilbert is out of hardwood, I'll call James.
UPDATE: Norm and James have not responded to phone calls since 2010. I hope they are simply retired, and still happy and healthy. Gilbert still sells firewood but has slowed down his operation so much that he usually has a waiting list. My new source of firewood is Steve Wright, who sells madrone as blogged here.
Heh.
I'm purposefully filing this under "Enjoyments", not "Politics". I don't care what he would write, or if I agree: it's just very funny to now see Karl Rove writing a political criticism instead of always receiving them. Good for him; it must feel therapeutic.
UPDATE: Here's a more polite essay similarly explaining that Obama has failed to win over investors.
UPDATE: Another Karl Rove essay, this time about the President's numerous "straw men".
UPDATE: Here's a more polite essay similarly explaining that Obama has failed to win over investors.
UPDATE: Another Karl Rove essay, this time about the President's numerous "straw men".
Dog, Cat, and Rat
A coworker sent me this link, about this crew.
I used to live in Santa Barbara, so seeing those streets again is an additional plus.
The best quotation is from the article.
I used to live in Santa Barbara, so seeing those streets again is an additional plus.
The best quotation is from the article.
“Peace can happen anywhere. If they can do it why can't people?
You know, they’re just 'dumb' animals. But now, who're really the stupid ones?”
Wednesday, February 18, 2009
Hair from the Back
About a week ago I saw on the Long Hair Community website two photographs, linked on this post, that made me curious about how my hair looks from the back.
The photographs have the same woman with her hair down or in a ponytail. To me, she appears much more feminine in the second photograph because gathering her hair into a ponytail reveals the cut of her shirt sleeves and the size and shape of her shoulders.
Every now and then, because of my long hair, a stranger who only sees me from the back calls me "ma'am". I wondered if the ponytail I normally wear also makes my gender more distinct.
Here are two photographs for comparison:
It might just be my perception, but I think the same thing happens with my ponytail: the shape of my shoulders and shirt is emphasized and thus my appearance from the back is more recognizably masculine.
And, no, I'm not going to put my hair up in a bun for a third comparison photograph.
The photographs have the same woman with her hair down or in a ponytail. To me, she appears much more feminine in the second photograph because gathering her hair into a ponytail reveals the cut of her shirt sleeves and the size and shape of her shoulders.
Every now and then, because of my long hair, a stranger who only sees me from the back calls me "ma'am". I wondered if the ponytail I normally wear also makes my gender more distinct.
Here are two photographs for comparison:
It might just be my perception, but I think the same thing happens with my ponytail: the shape of my shoulders and shirt is emphasized and thus my appearance from the back is more recognizably masculine.
And, no, I'm not going to put my hair up in a bun for a third comparison photograph.
Created Wicked
I do not think I have ever heard a sermon on Proverbs 16:4.
Adonai has made everything for its own purpose,But it seems true that at least a few people are simply built evil.
even the wicked for the day of evil.
Ode to a Superhero
Back when I was in high school I listened to Weird Al a lot. Since my college days I have fallen out of touch with his music.
Today I stumbled upon one of his more recent songs, changing Billy Joel's Piano Man to be about the first Spiderman movie. Besides the entertainment in the musical parody, it was striking to see that when Weird Al did not make a music video for this song then one of his fans did--and very well, too!
Today I stumbled upon one of his more recent songs, changing Billy Joel's Piano Man to be about the first Spiderman movie. Besides the entertainment in the musical parody, it was striking to see that when Weird Al did not make a music video for this song then one of his fans did--and very well, too!
Campaign Promises Update
Last month I mentioned the Obameter. It is interesting to see how President Obama is doing with his campaign promises.
Some people are claiming he is much more dishonest. But most such articles I have read claim as campaign promises positions that I do not think President Obama ever claimed.
For example, he never claimed he would accurately present our country's great help to Muslim people in recent years. Just because someone objects to the choices he made during a diplomatic effort does not create a broken campaign promise.
Some people are claiming he is much more dishonest. But most such articles I have read claim as campaign promises positions that I do not think President Obama ever claimed.
For example, he never claimed he would accurately present our country's great help to Muslim people in recent years. Just because someone objects to the choices he made during a diplomatic effort does not create a broken campaign promise.
An Upcoming Bankruptcy Issue?
Todd Zywicki writes about how trying to help bad mortgages may cause even worse problems.
Home prices continue to drop, even in Eugene.
Home prices continue to drop, even in Eugene.
Oregon Lawmaking
Huzzah for Peter DeFazio for standing against the stimulus bill. I do not agree that his cited criticisms of the bill are its worst aspects, but I admire that he read enough of it to feel certain how he should vote. I've told him so.
Meanwhile, other Oregon law-makers want to ban aftermarket car parts and put a huge tax increase on beer brewing. For those I'm at a loss for words.
Meanwhile, other Oregon law-makers want to ban aftermarket car parts and put a huge tax increase on beer brewing. For those I'm at a loss for words.
Sunday, February 15, 2009
Weight Loss
Back in August I mentioned that I needed to lose weight.
I had some progress during the Fall of 2008. But then it got too cold to exercise regularly with a baby. I don't mind a walk when the temperature is in the 30s, but little Smiley gets too cold in a stroller or Ergo.
Then visiting my wife's family in December undid my Fall 2008 progress, and January was still too cold for long walks with a baby.
But during the past three weeks the weather has been warmer and I've made good progress again.
Now I am halfway to my goal. I should be at what our electronic scale measures to be 155 pounds and 23% body fat. I'm now at 161 pounds and 25% body fat.
I had some progress during the Fall of 2008. But then it got too cold to exercise regularly with a baby. I don't mind a walk when the temperature is in the 30s, but little Smiley gets too cold in a stroller or Ergo.
Then visiting my wife's family in December undid my Fall 2008 progress, and January was still too cold for long walks with a baby.
But during the past three weeks the weather has been warmer and I've made good progress again.
Now I am halfway to my goal. I should be at what our electronic scale measures to be 155 pounds and 23% body fat. I'm now at 161 pounds and 25% body fat.
Geert Update
Last month I mentioned events surrounding Geert Wilders as an example of unfairly applying "tolerance" and "free speech" to only one party in a shouting match.
He continues to serve in that role, now for England.
I'm not worried about this happening in the U.S. We are simply too violent and weird. Our nation thinks anarchists are cool and dissent is patriotic. We even have an entire demographic named "survivalists" whose love of individual freedom is only matched by the size of their personal arsenal.
In many countries the message "don't annoy us or we'll get violent" is threatening. But I expect that in the U.S. it would not work since the obvious reply of acting even more loud and obnoxious is so natural. Before there was enough social momentum to cower or fight back there would be a new trend of people who support free speech on alternate Mondays by using random empty SUVs at shopping mall parking lots as target practice from a dozen blocks away.
Sigh. I can't find online those Dilbert cartoons where Dogbert gets his way simply by being really loud.
He continues to serve in that role, now for England.
I'm not worried about this happening in the U.S. We are simply too violent and weird. Our nation thinks anarchists are cool and dissent is patriotic. We even have an entire demographic named "survivalists" whose love of individual freedom is only matched by the size of their personal arsenal.
In many countries the message "don't annoy us or we'll get violent" is threatening. But I expect that in the U.S. it would not work since the obvious reply of acting even more loud and obnoxious is so natural. Before there was enough social momentum to cower or fight back there would be a new trend of people who support free speech on alternate Mondays by using random empty SUVs at shopping mall parking lots as target practice from a dozen blocks away.
Sigh. I can't find online those Dilbert cartoons where Dogbert gets his way simply by being really loud.
Government Shopping Shakedown
Well, so far the stimulus bill has not impressed me. I trust the CBO (for no real reason) in its analysis that the stimulus bill is only somewhat needed and is not the best fix, will do long term harm, and has hidden costs.
It's also simply too big and too much big-government.
But two articles have given me some new hope that the stimulus bill will have some hidden benefits as well. Appropriate first steps towards dealing with the Entitlement Crisis would be restructuring government agencies and bringing to the forefront of public debate a discussion about the future of welfare. I expect that if the stimulus bill does both of these it will have been sufficiently effective, no matter where its monetary assistance goes.
UPDATE: Added the two "big-government" links.
It's also simply too big and too much big-government.
But two articles have given me some new hope that the stimulus bill will have some hidden benefits as well. Appropriate first steps towards dealing with the Entitlement Crisis would be restructuring government agencies and bringing to the forefront of public debate a discussion about the future of welfare. I expect that if the stimulus bill does both of these it will have been sufficiently effective, no matter where its monetary assistance goes.
UPDATE: Added the two "big-government" links.
What Economists can Predict
A week ago I commented that economists are lousy at prediction, and linked to an article that said so less than politely.
To be fair, here is a link to an excellent blog post by Greg Mankiw about fourteen items on which most economists agree. On these points economists can predict with reasonable certainty.
It would be nice if all high school students learned this "short list" of well-tested economic principals.
To be fair, here is a link to an excellent blog post by Greg Mankiw about fourteen items on which most economists agree. On these points economists can predict with reasonable certainty.
It would be nice if all high school students learned this "short list" of well-tested economic principals.
Hopeful News, Salted with Pessimism
Recently retail sales are up and the amount of new jobless claims is down. Positive economic news!
But I doubt it means much overall. The recession is still getting worse. We have not yet seen the inflation caused by the stimulus bill.
(In other words, the market has stabilized, but the recession will endure until the market actually recovers. I found a nice chart about that here. For investors, recessions are turbulent but after the early crash are mostly flat. Fleeing the market entirely is unwise because when recovery comes it happens suddenly and sharply.)
Here is an interesting article with some healthy pessimism. It notices the upcoming inflation and worries it will cause "the next official recession". It also wonders if a continued recession, with the associated continued pleas for more government spending, is what some politicians are really trying to create. (Fortunately, not all.)
UPDATE: Another bad sign: European banks are still in increasing trouble.
But I doubt it means much overall. The recession is still getting worse. We have not yet seen the inflation caused by the stimulus bill.
(In other words, the market has stabilized, but the recession will endure until the market actually recovers. I found a nice chart about that here. For investors, recessions are turbulent but after the early crash are mostly flat. Fleeing the market entirely is unwise because when recovery comes it happens suddenly and sharply.)
Here is an interesting article with some healthy pessimism. It notices the upcoming inflation and worries it will cause "the next official recession". It also wonders if a continued recession, with the associated continued pleas for more government spending, is what some politicians are really trying to create. (Fortunately, not all.)
UPDATE: Another bad sign: European banks are still in increasing trouble.
Friday, February 13, 2009
Today's Four Videos
I'm still way behind on editing photographs and videos of Smiley to put online.
Today I took four videos. I made time to edit and post them tonight so family and friends can see how much he has grown.
Today I took four videos. I made time to edit and post them tonight so family and friends can see how much he has grown.
- In the late afternoon he was visited by Katrina and Blake's son, Liam. They had not seen each other in many months. Smiley does not often get to play with someone near his own age. He was not quite sure what to do. But he was very polite about sharing his toys.
- Just as the sun set, waiting for mommy to get home from work, he played with a flashlight.
- After dinner he wanted to go down and up the stairs. He has gotten quite skilled at this.
- Later in the evening he rode his new scooter a bit and then did one more trip on the stairs. He still does not walk unassisted (hooray!) but really likes the scooter.
A Foreboding Precedent
A few weeks ago I wrote that the most problematic part of the current recession is how recent government spending is bringing the Entitlement Crisis years nearer.
Perhaps I was wrong and the unprecedented budget deficit will be more significant in the long run. I do not think so, but now that Congress has learned it can get away with annually spending nearly 14% of the GDP it may become habit.
UPDATE: Apparently that graph is from this article.
Perhaps I was wrong and the unprecedented budget deficit will be more significant in the long run. I do not think so, but now that Congress has learned it can get away with annually spending nearly 14% of the GDP it may become habit.
UPDATE: Apparently that graph is from this article.
Stocks Buffetted
Sorry. Bad pun.
But nice (and short) article with a graph that makes me wonder why I've never considered such a comparison. Probably because I'm not an economist, huh?
But nice (and short) article with a graph that makes me wonder why I've never considered such a comparison. Probably because I'm not an economist, huh?
Monday, February 09, 2009
Adventuring with Tesla and Verne
Last December, while on the train to California, I talked some with a young man who was working on a computer role-playing game with a "Future Victorian Science" theme. His ideas for the setting were interesting to talk about (airships, steam cars, etc.). He had never heard of the Planetary comic, so I recommended that as a similar shtick.
It turns out that for a pencil-and-paper role-playing game his idea has already been done. Nifty.
It turns out that for a pencil-and-paper role-playing game his idea has already been done. Nifty.
Sunday, February 08, 2009
February Financial Pondering
At the end of December I wrote about four strategies to invest well in 2009.
Since January is now behind us it is time to add more detail since there is a lot of recent positive news. During the past two months the markets have been fairly stable and corporate paper is beginning to return. The prime rate and LIBOR are extremely low and overall banks are feeling better than many businesses: banks which are not bogged down in the mortgage crisis (able to value their books) are cooperatively poised for a quick and confident recovery. The CBO estimates the recession will be over within a year. The Stimulus Plan is now moving forward, which may not be good news but in any case the market will probably still decline for about a year. Finally, no large acts of terror happened in the days of uncertain consequences as one president's term ended, or as a commentary on a new president being inaugurated.
So, how to invest now? Again I present the wisdom gleaned from discussion with family members more economically literate than I.
One strategy would be to find investments that are "the diamonds in the rough". This must be done by sector. For example, sound banks are currently undervalued since all banking is in disfavor. Perhaps it is still early for any bank stock. But if you know of a small, local bank that is sound it might be worthwhile to support it.
(Here in Eugene the bank Pacific Continental is well rated and has good numbers; I might make a few phone calls to learn more.)
A second strategy is to trust the holding companies to spot the diamonds in the rough. As examples, Berkshire Hathaway (growth) and Haven Capital Trust II (dividend) are currently undervalued. Good holding companies have experience making use of others' luck.
A third strategy is to use mutual funds to avoid fees when purchasing or selling. After all, if it costs you $10 to buy a stock and then $10 to sell it, those fees total 2% of a $1,000 investment. If you are investing amounts of that size you might not be confident that any particular company will outperform its sector's minuscule-fee mutual fund by more than 2%. During a recession consumer staples normally do well. The Stimulus Plan is expected to cause materials to do well for at least a year. Internationally, India is expected to do better than average this year.
Finally, as mentioned in December, no matter how you invest be ready for inflation (and liquidity) with a mortgage and investing some in gold.
No matter which strategy you use, note two things about analysis statistics.
First, realize that Price/Earnings (P/E) ratios are subject to economic fads. For example, after Enron and Sarbanes-Oxley it was fashionable to understate earnings and P/E ratios all rose; then it became fashionable to show high earnings and P/E ratios all fell. Today P/E ratios all tend low because the market is down (low Price), but also because companies are eager to appear healthy (report higher Earnings). During a recession do not trust a low P/E ratio to be meaningful until you have compared it to other companies in that sector.
Second, Earnings Per Share (EPS) is only estimated by analysts for less than a year forward. (Any report of a long term EPS estimate is merely scaling up the short term analysis.) During a recession this is too short a time frame and the analysis is too uncertain.
(These two details explain my above-mentioned inclination to call some of the local Pacific Continental managers rather than trust that the analysis statistics--P/E, EPS, and one-year Target Estimate--are now very meaningful.)
Since January is now behind us it is time to add more detail since there is a lot of recent positive news. During the past two months the markets have been fairly stable and corporate paper is beginning to return. The prime rate and LIBOR are extremely low and overall banks are feeling better than many businesses: banks which are not bogged down in the mortgage crisis (able to value their books) are cooperatively poised for a quick and confident recovery. The CBO estimates the recession will be over within a year. The Stimulus Plan is now moving forward, which may not be good news but in any case the market will probably still decline for about a year. Finally, no large acts of terror happened in the days of uncertain consequences as one president's term ended, or as a commentary on a new president being inaugurated.
So, how to invest now? Again I present the wisdom gleaned from discussion with family members more economically literate than I.
One strategy would be to find investments that are "the diamonds in the rough". This must be done by sector. For example, sound banks are currently undervalued since all banking is in disfavor. Perhaps it is still early for any bank stock. But if you know of a small, local bank that is sound it might be worthwhile to support it.
(Here in Eugene the bank Pacific Continental is well rated and has good numbers; I might make a few phone calls to learn more.)
A second strategy is to trust the holding companies to spot the diamonds in the rough. As examples, Berkshire Hathaway (growth) and Haven Capital Trust II (dividend) are currently undervalued. Good holding companies have experience making use of others' luck.
A third strategy is to use mutual funds to avoid fees when purchasing or selling. After all, if it costs you $10 to buy a stock and then $10 to sell it, those fees total 2% of a $1,000 investment. If you are investing amounts of that size you might not be confident that any particular company will outperform its sector's minuscule-fee mutual fund by more than 2%. During a recession consumer staples normally do well. The Stimulus Plan is expected to cause materials to do well for at least a year. Internationally, India is expected to do better than average this year.
Finally, as mentioned in December, no matter how you invest be ready for inflation (and liquidity) with a mortgage and investing some in gold.
No matter which strategy you use, note two things about analysis statistics.
First, realize that Price/Earnings (P/E) ratios are subject to economic fads. For example, after Enron and Sarbanes-Oxley it was fashionable to understate earnings and P/E ratios all rose; then it became fashionable to show high earnings and P/E ratios all fell. Today P/E ratios all tend low because the market is down (low Price), but also because companies are eager to appear healthy (report higher Earnings). During a recession do not trust a low P/E ratio to be meaningful until you have compared it to other companies in that sector.
Second, Earnings Per Share (EPS) is only estimated by analysts for less than a year forward. (Any report of a long term EPS estimate is merely scaling up the short term analysis.) During a recession this is too short a time frame and the analysis is too uncertain.
(These two details explain my above-mentioned inclination to call some of the local Pacific Continental managers rather than trust that the analysis statistics--P/E, EPS, and one-year Target Estimate--are now very meaningful.)
Crisis Blame
Last month I tangentially mentioned that
In related news, an interesting article about unionism and the Big Three that attempts to set the record straight but notably lacks analysis of any solution to the typically adversarial union stance.
UPDATE: Interesting to see how this advice from last September is or is not happening.
UPDATE: A silly cartoon. More about Christopher Dodd. And examples of why liquidity can be a problem when loans go bad.
UPDATE: Two more: a blog post from the Neo-Neocon discusses this article.
UPDATE: Less polite versions here and here.
UPDATE: A quite polite and detailed version here.
UPDATE: Even more here. Also from Bob Krumm, "Proving Regan Wrong"
UPDATE: Was it Greenspan?
UPDATE: Brian Saint-Paul adds details.
UPDATE: More Dodd, regarding the "bonus" fiasco.
UPDATE: Alan Reynolds notes that the global recession did not start in America.
UPDATE: Desmond Lachman writes, at the end of March, about Goldman Sachs playing a role as significant as Congressmen hiding the lack of health in Freddie Mac and Fannie Mae.
"the mortgage-liquidity crisis is a result of insufficient government oversight. To the contrary, the crisis was primarily a result of government meddling in what should have been normal market forces, although the blame is not quite that simple."This bit of truthful history is being increasingly reported. I wonder if the trend will continue?
In related news, an interesting article about unionism and the Big Three that attempts to set the record straight but notably lacks analysis of any solution to the typically adversarial union stance.
UPDATE: Interesting to see how this advice from last September is or is not happening.
UPDATE: A silly cartoon. More about Christopher Dodd. And examples of why liquidity can be a problem when loans go bad.
UPDATE: Two more: a blog post from the Neo-Neocon discusses this article.
UPDATE: Less polite versions here and here.
UPDATE: A quite polite and detailed version here.
UPDATE: Even more here. Also from Bob Krumm, "Proving Regan Wrong"
UPDATE: Was it Greenspan?
UPDATE: Brian Saint-Paul adds details.
UPDATE: More Dodd, regarding the "bonus" fiasco.
UPDATE: Alan Reynolds notes that the global recession did not start in America.
UPDATE: Desmond Lachman writes, at the end of March, about Goldman Sachs playing a role as significant as Congressmen hiding the lack of health in Freddie Mac and Fannie Mae.
Excellent Ulysses
I while ago I mentioned having The Odyssey as an audiobook.
I never blogged again to say how great an audiobook this was. The story is so obviously designed to be read aloud. It was easy to listen to. The slow pace and repetitive use of adjectives before the names of characters ("noble Ulysses", "clear-eyed Athena", etc.) soon became pleasant rather than boring and a huge aid to listening while also doing housework or daddy-work.
The Neo-Neocon recently wondered why the story is still a top seller. As a printed book I have no idea. But as an audiobook I have enjoyed it immensely.
I never blogged again to say how great an audiobook this was. The story is so obviously designed to be read aloud. It was easy to listen to. The slow pace and repetitive use of adjectives before the names of characters ("noble Ulysses", "clear-eyed Athena", etc.) soon became pleasant rather than boring and a huge aid to listening while also doing housework or daddy-work.
The Neo-Neocon recently wondered why the story is still a top seller. As a printed book I have no idea. But as an audiobook I have enjoyed it immensely.
Stimulus
Time for a longer essay about the Stimulus Plan, focusing on the two big questions.
1. What type of government plan would best stimulate the economy?
2. How soon would a recovery happen?
Since I am a mathematician, not an economist, I cannot answer these questions with any confidence. But then, neither can the economists. All I can do is read what brilliant economists have written and apply it to today, fourteen months into the current recession. This essay will discuss the implications of two essays by Milton Friedman.
Friedman's first article is straightforward and easy to read. He discusses the options for how the government could get the money for a stimulus plan (taxes, debt, printing more money) and their effects.
Friedman concludes that the most reliable plan for stimulus would be to print money and use it to buy existing government bonds. Historically a one-time printing of money need not lead to inflation, and removing government bonds from the market would move money previously used in those investments to private consumption or investment.
Oddly, few politicians or reporters are considering the long-term effects of paying for the current Stimulus Plan. Most are doing the opposite and accepting without proof that a short term plan of debt to fund work will have a longer term affect of overall creating jobs.
Friedman's second article is a classic analysis of how recessions end. Its comparison of three historical recessions deserves a bit more commentary.
Remember my post sharing how my family's investments are down to what they were three years ago? That fits nicely with his third chart: the market is about where it was three years previously one year into all of those three historical recessions. But the three recessions diverge wildly soon after. Which will this recession most resemble?
The main claim of the second article is that a faster growth of M2 corresponds with a prompter recovery (Friedman's figure 1). During the past few years M2 has been growing rapidly. This is very promising.
Also, although GDP fell during the last half of 2008 it decreased less than 5% total, which is not alarming (figure 2). The M2 affect should dominate, so the current recession will probably be more mild than those other three. However, note that according to Friedman's analysis even "more mild" means continued market loss for another year or two (figure 3).
In conclusion, Friedman's answer to the two big questions is that the government should print money, use it to buy existing government bonds, and plan on at least another year of market loss.
The economy is in recession but not in shambles. (Rather, it is a sound habit among individuals, corporations, and states of having a cash reserve instead of debt that causes trouble--with some notable exceptions.) There is no need for so much alarm.
(As a concluding tangent I should also note that there are problems with the proposed Stimulus Plan both legal and economic in nature. It is currently a gamble (article, chart) and thus an easy plan to oppose, but may be improved in future drafts.)
UPDATE: The final sentence has been revised for clarity; it now has a link to the source CBO document and summary table of possible multipliers.
1. What type of government plan would best stimulate the economy?
2. How soon would a recovery happen?
Since I am a mathematician, not an economist, I cannot answer these questions with any confidence. But then, neither can the economists. All I can do is read what brilliant economists have written and apply it to today, fourteen months into the current recession. This essay will discuss the implications of two essays by Milton Friedman.
Friedman's first article is straightforward and easy to read. He discusses the options for how the government could get the money for a stimulus plan (taxes, debt, printing more money) and their effects.
Friedman concludes that the most reliable plan for stimulus would be to print money and use it to buy existing government bonds. Historically a one-time printing of money need not lead to inflation, and removing government bonds from the market would move money previously used in those investments to private consumption or investment.
Oddly, few politicians or reporters are considering the long-term effects of paying for the current Stimulus Plan. Most are doing the opposite and accepting without proof that a short term plan of debt to fund work will have a longer term affect of overall creating jobs.
Friedman's second article is a classic analysis of how recessions end. Its comparison of three historical recessions deserves a bit more commentary.
Remember my post sharing how my family's investments are down to what they were three years ago? That fits nicely with his third chart: the market is about where it was three years previously one year into all of those three historical recessions. But the three recessions diverge wildly soon after. Which will this recession most resemble?
The main claim of the second article is that a faster growth of M2 corresponds with a prompter recovery (Friedman's figure 1). During the past few years M2 has been growing rapidly. This is very promising.
Also, although GDP fell during the last half of 2008 it decreased less than 5% total, which is not alarming (figure 2). The M2 affect should dominate, so the current recession will probably be more mild than those other three. However, note that according to Friedman's analysis even "more mild" means continued market loss for another year or two (figure 3).
In conclusion, Friedman's answer to the two big questions is that the government should print money, use it to buy existing government bonds, and plan on at least another year of market loss.
The economy is in recession but not in shambles. (Rather, it is a sound habit among individuals, corporations, and states of having a cash reserve instead of debt that causes trouble--with some notable exceptions.) There is no need for so much alarm.
(As a concluding tangent I should also note that there are problems with the proposed Stimulus Plan both legal and economic in nature. It is currently a gamble (article, chart) and thus an easy plan to oppose, but may be improved in future drafts.)
UPDATE: The final sentence has been revised for clarity; it now has a link to the source CBO document and summary table of possible multipliers.
Monday, February 02, 2009
HIPY PAPY BTHUTHDTH THUTHDA BTHUTHDY
Over the weekend my wife introduced me to the blog Cake Wrecks.
Most of the cakes discussed therein are decorating disasters. But every now and then Jen will showcase an unusually awesome cake.
Two memorably great ones within blog's first few pages were the Darth Vader Baby Shower Cake and two Minas Tirith cakes. (LoTR fans who sew garb should note the final link in the latter post.)
Most of the cakes discussed therein are decorating disasters. But every now and then Jen will showcase an unusually awesome cake.
Two memorably great ones within blog's first few pages were the Darth Vader Baby Shower Cake and two Minas Tirith cakes. (LoTR fans who sew garb should note the final link in the latter post.)
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