EclectEcon

Economic Outlook

My sister wrote yesterday that their financial advisor is pessimistic about economic and market outlooks for the next several months. She asked what I think. Here is what I sent her, somewhat edited:

I'm REALLY bad at this sort of thing, but here goes:

 

I think all the financial markets are over-heated. The reason is that interest rates are SO low that some/many people would rather buy stocks or corporate bonds instead of gubmnt bonds with such low yields available on the gubmnt bonds. 

 

I really cannot believe interest rates will stay this low much longer. And once interest rates on gubmnt bonds go up, people will show more interest in gubmnt bonds and shift some funds away from stocks and corporate bonds back to gubmnt bonds. So just this effect alone will cause stock prices and indices to drop.

 

At the same time, higher interest rates will tend to choke off some of the growth in spending on houses and other consumer durables. Couple that effect with the demographic effect as baby boomers try to downsize a bit (as we did) as well as spend less in general as they slow down, and look for housing prices to stop rising much and even to fall in some of the more bubbly housing markets. And as interest rates rise, look for consumer borrowing for spending on durables to drop from what seem to be pretty high levels these days.

 

Finally on the demand side, wait for the unfunded pension and other liabilities of many places like Illinois, California, Greece, Italy, Spain, Ontario and others that we don't know about to hit. As that happens, either those pensions will have to be shaved or gubmnt revenues will have to go up somehow... and yet they are finding it increasingly difficult to raise taxes. 

 

Furthermore, as taxes are raised, too many jurisdictions are at a point where higher tax rates will induce less work and increased flight from the jurisdictions. These supply-side effects will lead to further declines in output and incomes.

 

Meanwhile, gubmnt regulations just keep growing and growing. These also create negative supply effects as it becomes increasingly costly to carry on any kind of business.

[as a for instance, see this by Scott Sumner, especially his point #4]

 

On the plus side, there are more and more free(r) trade deals being negotiated. Locals will object, but overall freer trade means more world production, more world wealth, and (even in the rich countries) higher living standards for all, on average.

 

However, the slowdown in China has been coming for quite some time. That will also have some (likely slight) negative impact on other economies.

 

With all this having been said, you may not want to trust me on it. I have been pessimistic about market conditions and economic growth for the world economies for several years and have clearly been either wrong or (more likely) premature. 

 

My own decisions have been as follows: 

• Until 2005, we had all my pension funds in equities (common stocks). We cut that back to 30% then. That meant the crash in 2007-8 didn't hurt us much but we also missed the massive upswing in the markets after that. But since I know I will never be able to time market swings, that doesn't bother me a whole heckuva lot. I do know that I would be VERY uncomfortable if we lost half the market value of my pension fund, so I am not willing to try to ride out any huge dips in the stock market with too much invested in stocks.
• Right now we have scaled back our investments in stocks to only 25% of our portfolio, and I'm seriously considering cutting it back to only about 20%. [side note: Because of the US tax laws, I must invest in individual stocks and cannot buy mutual funds ARRGGHHH]. 
• We have about 35% of our investments in high-quality corporate bonds. We'll take a hit on these because as interest rates go up, bond prices go down. We can live with this.
• The rest is in short-term money market stuff: short-term gubmnt bonds and treasury bills.

My instructions to the outfit that handles our investments (I won't do it on my own) is to try to stay fairly liquid (i.e. short term and in high-dividend-paying stocks). See this piece that I wrote a month and a half ago.

 

​But keep in mind that I've been thinking this for over five years and it hasn't happened yet. ​

 

So, in conclusion, I think your financial advisor is probably right, but I have no idea what the timing or seriousness of the problem will be. 

The Minimum Wage and Unemployment among Minority Teens

Thomas Sowell is one of the top economics-policy writers. I've been reading his pieces for nearly 35 years. His recent column on how minimum wage laws cause disproportionate unemployment among teens and especially among minority teens is compelling [via Marilyn]. His concluding few paragraphs:

In European welfare states where minimum wages, and mandated job benefits to be paid for by employers, are more generous than in the United States, unemployment rates for younger workers are often 20 percent or higher, even when there is no recession.

Unemployed young people lose not only the pay they could have earned but, at least equally important, the work experience that would enable them to earn higher rates of pay later on.

Minorities, like young people, can also be priced out of jobs. In the United States, the last year in which the black unemployment rate was lower than the white unemployment rate -- 1930 -- was also the last year when there was no federal minimum wage law. Inflation in the 1940s raised the pay of even unskilled workers above the minimum wage set in 1938. Economically, it was the same as if there were no minimum wage law by the late 1940s.

In 1948 the unemployment rate of black 16-year-old and 17-year-old males was 9.4 percent. This was a fraction of what it would become in even the most prosperous years from 1958 on, as the minimum wage was raised repeatedly to keep up with inflation.

He concludes:

Some "compassion" for "the poor"!

 

 

Two Good Pieces on the Minimum Wage

Please, if you think the minimum wage should be raised, read these two items about "unintended consequences", both via Wonkbook at The Washington Post.

BARRO: New York's new fast-food minimum wage makes no sense. "The raise would apply only to fast-food workers, and only if they work for a chain with at least 30 locations. A wage increase applying to such a narrow segment of the economy is bound to have unintended consequences. ... A business owner who previously ran chain fast-food franchises might choose instead to open independent stores so he could avoid the wage requirement. If he already has 29 stores, he might choose not to expand. If subject to the requirement, he could install iPads at the counters to take orders instead of live, wage-earning humans. He could buy food that is already prepared by an outside vendor (who wouldn’t have to pay the higher wage) and employ fewer workers in the kitchen. Economists call these changes 'distortions,' and they cause two kinds of problems. One, fewer workers get a raise as a result of the minimum wage. Two, it encourages businesses to do things that customers may not prefer." The New York Times.

McARDLE: Upstate New York can't afford the new minimum. "The median hourly wage for New York state is only $19.65, meaning that fast-food workers will now be paid 75 percent of the median for doing work that involves so little skill that it is frequently performed by teenagers who aren't old enough to drive. And in the poorer regions, that disparity is likely to be even more stark. ... The rural north is so economically depressed that prisons are fondly regarded as sources of employment, and the deindustrializing western portion of the state has many of the same problems, plus large brownfield areas from long-departed factories that no one can afford to clean up, and a structural overhang of buildings, government programs and people left over from flusher times. The more young people depart in search of work elsewhere, the worse the problems become." Bloomberg View.

See This Play! "The Big Lad"

Last night I went out to Fanshawe Pioneer Village on the NE edge of London, Ontario, to see Jason Rip's original script about the impact of WWI on a small southern Ontario town. The play is "The Big Lad". It was amazing. There is one final performance tonight. Go see it!

The story is about life in a small farming community from 1914-1917. Young men wanted to go to war, but some were turned down for various reasons while others did go. Meanwhile xenophobia reigned as Canadians feared and resented the Germans in their communities [digression: indeed, the people of Berlin, Ontario, renamed it Kitchener]. Rip, the playwright, and the actors captured so many facets of all these emotions, and more, in a play that lasted only about an hour.... It doesn't matter that it was only an hour --- it was brilliant.

All of the acting was good. I knew two of the actors (Demis Odanga and John Turner) and fully expected the high quality performances from them that I saw; I wasn't disappointed. And I had seen Taylor Bogaert recently and was pleased to see him more than live up to the standards of Alvego Root Theatre (the company that produced the play). But most impressive for me was Shayne Coffin who played the title role, The Big Lad. He was truly brilliant in the role.

Adam Corrigan Holowitz directed and produced the show. His direction and staging were beyond brilliant. The venue is an old barn set up in a mini-proscenium style. It is not the set that amazes, though, because it doesn't: it is simple. It's what Adam and the actors do with the set, the 8' x 8' angled proscenium, the entrances, the exits, and the actions. Just wonderful.

[by the way, I saw this play on the evening of the hottest day we'd had so far in Ontario, and the venue wasn't at all uncomfortable.]

I have seen other plays about WWI and southern Ontario, and I have thought they were really very good. The Big Lad was better.

There is one more performance of this play, tonight. It's only about $17 (with taxes) and well worth it. There are plenty of seats available, so you can buy tickets at the door.

Go see this play. You won't regret it.

Canada's Reputation #1 Despite HDF

From Terence Corcoran:

Maybe you missed the news last week, which is that Canada under Stephen Harper’s Conservative government has just regained its title as the most reputable nation in the world. According to the Reputation Institute’s annual report, Canada remains at the top of a 55-nation list for perceived trust, admiration and respect, based on a survey of 48,000 people around the world.

Easy to miss, that story, since few media picked it up. Instead, the Canadian media complex is in the grip of Harper Derangement Frenzy (HDF), which is an upgrade to hurricane status from Harper Derangement Syndrome, identified several years ago by Lorne Gunter as “an ideological hatred of Prime Minister Stephen Harper that is so acute its sufferers’ ability to reason logically is impaired.”

A table in the column shows:

Uber and Insurance

Every person I know who has used Uber has been extremely pleased with it. The cars are clean, the drivers are polite and generally quite knowledgeable, and the smartphone app lets both driver and customer know what's what.

So why is there a problem with allowing Uber to compete with taxis and with limousine services? As most of you know, I am strongly in favour of limiting restrictions on competition in the taxicab industry, having played a role the local changes that allow limousines to compete more directly with licensed taxicabs.

The only problem I see with Uber is insurance. In Ontario, we have no-fault auto insurance. Furthermore, Uber charges for (and is believed to provide) liability insurance for their drivers, even if they aren't carrying a passenger, so long as the driver is logged onto Uber as "available". So customers are probably covered, as are third parties (but see below).

The problem comes with the drivers themselves. If they carry paying passengers, they need to carry "commercial", not "personal" auto insurance. To drive for Uber and to have only personal auto insurance is taking a personal gamble, as well as possibly imposing a risk on potential third parties; and it is quite possibly defrauding the insurance companies. 

I asked my insurance agent for RSA, with whom we have our auto insurance, about this and here is what she replied:

At this time, a Personal Policy with RSA will NOT provide any coverage for UBER driving.

As you would now be “carrying passengers for hire”, you would need to get a commercial policy if that was something you were interested in.

Although UBER may provide some liability in a lawsuit situation, there are other factors (Accident benefits / damage to your vehicle etc) which would also have to be dealt with.

Part of the application does specifically ask about carrying passengers so we are required to disclose it to the insurance company.

... [W]ith this being new to London, the companies are just reacting to [it] now. This may be something that changes in the future; however at the moment it is not something they are willing to cover – and all coverage would be denied in the event of a claim. [emphasis added]

To be clear: no, I am not intending to drive for Uber (though I would consider it if personal auto insurance were sufficient).

What this means, then, as someone pointed out somewhere on Facebook, is that if you ride with Uber (in London, Ontario, as of now), you are likely signaling that you are willing to give business to someone who is likely lying to their insurance company.

And with that in mind, I probably will not be using Uber in the near future.

Marry in Your Late 20s

If you want to reduce the probability of divorce, marry in your late 20s.

But the important thing, for Wolfinger, is that "we do know beyond a shadow of a doubt that people who marry in their thirties are now at greater risk of divorce than are people who wed in their late twenties. This is a new development." And it will take some further research to suss out what this means for the demographics of marriage going forward.

Here are the data, including confidence intervals!!!

My Recent Walk

On Saturday, I visited with friends at the Masonville Starbucks and then walked home along the Thames Valley Trail.* Along the way, I used my iPhone to take a few photos.

I have never seen double-layered thistles before, and I fell in love with them.

And of course I am enamoured of the Fibonacci sequences and formations in these flowers.

 

 

 

 

 

I also saw some beautiful finches/warblers but couldn't zoom in on them or crop the photos sufficiently well. I gotta take a real camera with me next time.

 

 

 

 

 

 

 

 

 

In Gibbons Park there are some willow trees with really interesting knobby growths on them.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Near Harris Park, there were some Black-eyed Susans (which always remind me of "the Highwayman") and these wonderful purple flowers providing nectar for the bees.

Once again, though, I had the feeling that I love the patterns and colours of the inner flower. I really do need to take a better camera with me on these walks.

 

*Over two months ago I injured my knee during a performance of Neville's Island. I thought it had been something minor, but as time went on, it got worse. Fortunately though with rest and appropriate exercise, I am now nearly recovered [whew!!]. Last Monday I did a two-mile walk, and this one was about 4.5 miles. Aside from needing to rebuild my strength and stamina, all seems well.

 

Computers Calling Balls and Strikes -- about time!

Back in the days of rec.sport.baseball, Gary Huckabay advocated the use of cameras and computers to call balls and strikes for baseball games. He knew the technology could do it, but also knew it would take some time to be accepted.

Now it will be tried in an independent baseball league for a couple of games on an experimental basis. Yea!

According to John Shea of the San Francisco Chronicle, the Pacifics will use an automated computer system to call balls and strikes later this month in the first human umpire-less games in professional baseball history. The team plans to use the technology on July 28 and 29 against the Vallejo Admirals.

The system is called PitchFX, and utilizes a multitude of camera angles to calculate pitch speed and trajectory. All 30 MLB stadiums are already equipped with PitchFX, and it is used to evaluate umpires as well as for analytics purposes.

I must say that after watching the pitch tracker for the past several years and seeing how many incorrect calls are made, I welcome this development. May it please happen in my lifetime!

Eventually, I expect the sport will use computerized voices to call balls and strikes and not rely on someone to relay the computer results. I can also imagine that a similar scheme can be put in place to assess whether a batter holds up on checked swings. However,

As my umpire friend Jim Cressman says, though, who will sweep off home plate?

What is the most common ingredient in Canadian Cuisine?

When this question first occurred to me, I assumed (following a mid-70s National Lampoon article about Canada) that the answer would be "tapioca". 8-)

And let's face it: the question assumes there IS such a distinctive thing as "Canadian cuisine" [what, poutine? what else?]

But after looking at the list of the most common ingredient in many cuisines, [via King],

Ms Eclectic and I agree that likely the answer is "butter".

But actually I think it's probably "water".

 

If You Are Stopped by the Police

The death of Sandra Bland has left me wondering, "Well what SHOULD I do if the police stop me?"

Fortunately, Time has an answer:

... [H]ere are some things for all of us to consider:

1.You have the right to remain silent. That is true whether you’ve just been temporarily detained or formally arrested. ...

2. You do not have to consent to a search of yourself or your car. ... Keep in mind, however, that if the police have probable cause to search your car, or if you’ve been placed under arrest, they can search you, and sometimes your vehicle, whether you give your consent or not.

3.If you are arrested, you have the right to ask for an attorney and should do so immediately. If you have only been stopped temporarily, you’re not entitled to an attorney at that point. But if you’re being held for an extended period of time, either they’re going to have to let you go or place you under arrest.

4.If you’ve been stopped (but not arrested), you have the right to ask the police whether you’re free to go. If they say yes, you should calmly walk—not run—away from the scene.

5. As difficult as it can be, try to remain calm and be as polite as you can. Even if your rights have been violated, you’re not going to argue your way out of the problem. It’s also always a good idea to make sure the police can see your hands, and that you don’t make sudden movements, interfere with what the police are trying to do, or give false statements. In other words, don’t give the police an excuse to mistreat you or pile on additional charges.

Generally, the best advice is to pay close attention to the situation whenever you are interacting with a police officer. If you’ve had a negative experience, or believe that your constitutional rights have been compromised, you should take note of all of the circumstances surrounding the encounter, including the police officer’s name and badge number, and pursue a complaint afterwards.

I doubt if I'd have the wits to think about this, but I would also hope I would remember to set my iPhone voice recorder going.

Is This a Liberal Put-Down of the Conservative Attack Ads on Justin Trudeau?

It's funny, no matter what your political persuasion.

Surliness and the Lack of Competition

When there is little or no good competition, people providing a service tend to have less incentive to do a good, pleasant job. Or, as Scott Sumner says,

... government offices don't have to compete for customers as private companies do, so they don't care very much about customer relations. Of course some private monopolies suffer from the same problem.

Of course his statement is provocatively strong, but in general he is right. Petty bureaucrats can get all officious when dealing with us if their bosses don't much care, and their bosses will tend to care less if we customers have few, if any, good options.

Yes, some gubmnt employees provide great service. In fact we had a very pleasant experience last week at the passport office, renewing our passports.*

And with increasing competition from private couriers, we have noticed that the postal service is slowly improving the quality of its service, at least in areas where the competition matters.

Harold Demsetz frequently argued, the major source of lasting monopoly power is gubmnt. Whether the monopoly is gubmnt activity or gubmnt-created or gubmnt-protected monopoly, it is in these types of monopolies where people tend to have less incentive to provide good customer service.

And, after all, people respond to incentives.

Note: I said "tend". I know there are dedicated people who work hard to provide good service in gubmnt or other monopolies.

*Digression: We took a gamble and renewed our passports for ten years. When I laughed about that, the passport official said someone who is 100 years old had recently renewed their passport for ten years! Heck, I'm still <90.

Curse Words, Frequency of Use by County

Regular readers of EclectEcon know that I try to avoid swearing here and on Facebook. At home, around friends, and in the classroom my Edward Hyde side emerges, in a sense. In this list, I use all but "Gosh" and "Darn" with varying and sometimes great frequency.

Almost a billion tweets, from October of 2013 to November of 2014, were collected by Diansheng Guo at University of South Carolina, totaling nearly 9 billion words. Here’s how Grieve explained what happened once the data was collected:

For any word ... we measure its relative frequency in each county by diving the total number of occurrences of that word in that county by the total number of words in that county.

We take that raw map and smooth it using a hot spot analysis (a Getis-Ord Gi local spatial autocorrelation analysis). 

Here is the map for "Gosh". There are seven different maps for seven curse words along with more details and explanations at the link.

A 40mph Segway Knock-off!?

I am really, really tempted to get one of these.

 

If it is available at a sizable price reduction for Amazon Prime Day, I'll be tempted even more.

 

I loved using a real Segway 5 years ago, and those rental units were limited to only about 12 mph.

 

 

 

But the more I think about it, 40mph sounds a little dicey on one of these.

 

Furthermore, the subject line on Amazon says 35-40kmh, not mph :-(

 

That makes more sense.

 

 

 

Maybe I should settle for the less expensive and slower model. It will do 20mph (or is it 15-20kmh? It is difficult to determine based on what the Amazon listing asserts).

 

Amazon Prime Day!!!!

So it's a trumped up shopping holiday. So what if there are good sales and good prices? And even if you aren't a member of Amazon Prime, this might be a good time to try out their 30-day free trial.

 

 

"My AGW Trumps Your Maunder Minimum" [or vice versa!]

The concern about anthropogenic global warming (AGW) has been challenged by a Northumbrian mathematician. From the Washington Post [via Jack]:

This week, warnings of an impending “mini ice age,” set to hit in the 2030s, have been circulating in the media. ...

The ice age idea got rolling last week when researcher Valentina Zharkova, a professor of mathematics at Northumbria University in England, presented some of her recent research into solar variations at the Royal Astronomical Society’s National Astronomy Meeting in Wales. The presentation was based on a study ... which presented a technique for understanding variations in solar radiation and made some predictions about how this radiation will change in the near future. Most notably, the research predicts that between 2030 and 2040, solar activity should drop significantly, leading to a condition known as a “solar minimum.” ...

According to the research, solar activity at this time should resemble conditions last seen in the mid-1700s during a period known of low solar radiation known as the “Maunder Minimum.” The interesting thing about this period was that it coincided with a “little ice age” in Europe and North America — a time marked by unusually cold temperatures and bitter winters. Now that Zharkova and her colleagues are predicting another solar minimum coming up, media coverage has jumped on the idea that a modern “mini ice age” is in store.

Michael Mann, a leading proponent of concern about AGW (and whose work has been seriously criticized [see this] ), doesn't buy it, but his apparent only explanation is

As far as the solar variations go, “The effect is a drop in the bucket, a barely detectable blip, on the overall warming trajectory we can expect over the next several decades from greenhouse warming,” said Michael Mann, distinguished professor of meteorology at Pennsylvania State University, in an e-mail to The Washington Post.

The article points out that Zharkova refuses to go on the record scientifically as to whether her predicted mini-ice-age would have much of an impact on the earth's temperature. It does add, however, that

On the one hand, Zharkova maintains that her research was not intended to make assumptions about the effects of solar variation on climate — only to lay out predictions about the solar activity itself. “What will happen in the modern Maunder Minimum we do not know yet and can only speculate,” she says. On the other hand, she adds, her gut assumption is that temperatures will drop as they did 370 years ago.

The Steven Truscott Story-- Investigation Discovery

Some years ago, while we were living in Clinton, Ontario, a group from Investigation Discovery came to Vanastra (a small village just south of Clinton) to film the story of Steven Truscott., a young teen who was unjustly convicted of the murder of a classmate, likely on the basis of the trumped-up testimony of a pathologist.

A number of my friends were in the show, including my son and two of my granddaughters. I played the murderer, but since no one is sure who that was, you can't see my face as I was driving the old white Chevy or dragging the victim's body into the woods where she was found.

Well at Least I Wouldn't Struggle to Learn My Lines....

Shakespeare without words? Gimme a break. As my Shake-o-phile grand says, "His language is perfect." or words to that effect.

In Act 5 of “Love’s Labor Lost,” one character scoffs at pedants: “They have been at a great feast of languages, and stolen the scraps.” The latest Shakespeare fashion, at least in the Washington area, is to invite people to a feast of language and serve nothing but grunts, grimaces and grins—with a few gyrations thrown in for dessert.

The Synetic Theater has harvested a bushel of Helen Hayes Awards (the local version of the Tony Awards) for its Silent Shakespeare shows in the past dozen years. The company (whose name blends “synthesis” and “kinetic”) is run by a husband-and-wife team who were raised in Soviet Georgia and pride themselves on making Shakespeare “very accessible.” Paata Tsikurishvili, described in a Synetic video as a “visionary director,” explains: “Why I do Shakespeare, like this with less text, is because we have that vocabulary to express without the words—like crying and laughing; I take it to the next level.”

And the conclusion is really spot on:

Still, Silent Shakespeare is akin to mental nouveau cuisine with more flourishes than calories. The fact that many Washingtonians consider Silent Shakespeare an improvement rather than an oxymoron reflects unkindly on the capital’s cultural pretensions. But perhaps we should not be surprised that the city that pioneered obfuscation is now exalting expunging English altogether.

The photo that accompanied the article:

The Iran Deal

My take:

• Iran signed an NPT [a non-proliferation treaty] long ago (see this), albeit under the Shah.
• Iran breaches NPT
• US and the west try to negotiate something to be able to enforce the original NPT.
• US and the west agree to weakened conditions of original NPT.
• and the US and the West believe Iran will honour the new agreement.

Jack's assessment:

Compliance failure is hard wired into the agreement, according to this account:

From the Times of Israel:

A deal has been reached between the world powers and Iran over the latter’s nuclear program after a series of major American concessions, Ehud Yaari, the Middle East affairs commentator for Israel’s Channel 2 television, said Friday night. “It is done. It is done,” he said, and will be signed “early next week.”

The aim of the agreement is to put a negotiated end to a 13-year standoff with Iran over its suspect nuclear program and to block its pathway to developing a nuclear bomb in exchange for lifting biting global sanctions. Israel’s leadership has relentlessly opposed the emerging agreement, with Prime Minister Benjamin Netanyahu warning that it will pave Iran’s path to a nuclear arsenal.

What Do Joe Maddon and EclectEcon Have in Common?

Joe Maddon is currently the manager of the Chicago Cubs. Previously, he managed the Tampa Bay Rays. Besides enjoying baseball, he and I have something else in common.

From an interview with Baseball Prospectus,

DL: You majored in economics in college. What role do economics play in the baseball world of Joe Maddon?

JM: Honestly, I was not a very good student. With economics, "ubiquitous" was probably my favorite term. I guess that the number-crunching is something I liked. I've always been into that. I've always like analyzing statistical information, even before it was fashionable. When I was back in the minor leagues, as a roving hitting instructor back in the mid- to late '80s, I probably had a more simplistic perspective, but nevertheless I saw the value in it. But my economics days at Lafayette College were probably a case of having to declare a major more than anything.

Like Joe Maddon, I was an economics major and I was not a very good student (as an undergrad). I liked number-crunching at an intuitive level then, too. But I did fail a math course and get Ds in two different economics courses. I don't know about him, but I was lucky I didn't fail out.

Related articles

The Tale of Two Tutees

Steve Reich, again

Nine years ago when I was in Copenhagen, I happened to be there during the Jazz Festival. There were live concerts and performances everywhere, along with no prohibitions on enjoying a beer in public places. I wrote then about how much I enjoyed, indeed was mesmerized by, a group performing a piece by Steve Reich.

I had no idea what was being performed, but I loved it. The atmosphere was relaxed and, I am reluctant to use this term, "mellow" at the outdoor venue, with people coming and going, drinking beer, eating ice cream, and enjoying themselves. People's heads were bobbing in unison to the rhythm; and then there would be a chaotic interlude to the head-bobbing as the music developed a different cadence.

For some reason I was reminded of the music of Steve Reich last February and wrote about it again then.

Over the past few days, I have been thinking about the music of Steve Reich some more. For some reason I had not come across his "Music for 18 Musicians" before, but I think that might have been the piece I enjoyed so much back in Copenhagen.

It lasts for a approximately an hour. It is a very slowly evolving piece with a pulsing, driving underlying rhythm that captivates me. Apparently it captivates others as well. Someone wrote about it:

I put it on as a signal that it was time for my guests to leave, but they insisted on staying to listen to it again.

There is a good post about this piece here. It has some excellent commentary. One snippet:

Groups of instruments expose hypnotic melodic patterns adding a new note every so often – the opposite of traditional practice of linear fragmentation and variation. Slowly evolving melodic figures are set over fixed cadences, with the resulting magical effect of varying that which is unchanging. This gradual development of each melodic pattern reconstitutes our sense of time so that we genuinely begin to value each new note; time really does seem to freeze during a performance. No wonder, then, that Reich, rather than Philip Glass, has won a reputation as “the thinking man’s minimalist” – in place of the interminable, meditative scales and arpeggios of his aesthetic colleague, he reinvigorates the emotional potential of tonality and the musical satisfaction of large-scale form within a trance-inducing and crystalline soundscape.

Here are some links to several different full-length performances of the piece on youtube. Download one and give it a listen. You, too, will likely be mesmerized.

 

Screensavers

I don't know anyone who uses CRT screens for their computers any more. I expect some do, but those of us who don't use CRT screens (i.e. those of us who use LCD or other flatscreen monitors) really have little need for screensavers.

Those old CRT monitors also used a lot of power and time to start up again after being turned off, so shutting the monitor down wasn’t the best idea, either. The solution was a simple program that kicked in after several minutes and ran some basic images across the screen to keep the phosphors from getting bored. Thus, the screensaver was born.

Yet many of us still use screensavers. I do. I love seeing a moving collage of photos taken at a huge family gathering a couple of years ago.

The only possible drawback is that screensavers use more electricity than a blank screen uses. But that is easily dealt with. On my laptop, I set the screensaver to show only briefly when I'm on battery power. Otherwise I have it going for quite some time if I'm not using the computer.

"Politics Is a Scam"

An excellent summary of political economy by Don Boudreaux at Cafe Hayek (slightly re-formatted here; re-read it to keep the names straight.).

Market entrepreneur Smith succeeds only if and insofar as he persuades investor Jones and consumer Williams each to spend his or her own money on Smith’s business plan and products.

Political entrepreneur Politician Johnson succeeds only if and insofar as she persuades voter Jackson and voter Miller to spend other people’s money – namely, money belonging to taxpayers Smith and Jones – on Johnson’s political plan and programs.  

Despite the perversity of this reality, the Smiths and Jones of the world are commonly derided as greedy and antisocial pillagers, the Jacksons and Millers of the world are lauded as deserving and noble citizens, and the Johnsons of the world are celebrated, cheered, applauded, hailed, and memorialized as generous and visionary public servants.….

Politics is a scam.

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My Colonoscopy

If all goes according to plan, I'll be on the table having my colonoscopy while this is being posted. Here is the note I hope I taped to my butt, for the physician's enjoyment.

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If You Agree with What Is Being Reported about the Climate Conference in Toronto...

There is a conference about climate change going on in Trono these days. It is filled with people who have lots of rhetoric and considerable disdain for the scientific process. Matt Ridley explains why. His article is quite lengthy, but it is worth taking some time to read it.

 [I]nch by inch, the huge green pressure groups have grown fat on a diet of constant but ever-changing alarm about the future. That these alarms—over population growth, pesticides, rain forests, acid rain, ozone holes, sperm counts, genetically modified crops—have often proved wildly exaggerated does not matter: the organisations that did the most exaggeration trousered the most money. In the case of climate, the alarm is always in the distant future, so can never be debunked.

These huge green multinationals, with budgets in the hundreds of millions of dollars, have now systematically infiltrated science, as well as industry and media, with the result that many high-profile climate scientists and the journalists who cover them have become one-sided cheerleaders for alarm, while a hit squad of increasingly vicious bloggers polices the debate to ensure that anybody who steps out of line is punished. They insist on stamping out all mention of the heresy that climate change might not be lethally dangerous.

Today’s climate science...is based on a “pre-ordained conclusion, huge bodies of evidence are ignored and analytical procedures are treated as evidence”. Funds are not available to investigate alternative theories. Those who express even the mildest doubts about dangerous climate change are ostracised, accused of being in the pay of fossil-fuel interests or starved of funds; those who take money from green pressure groups and make wildly exaggerated statements are showered with rewards and treated by the media as neutral.

Ridley goes on to provide numerous examples to support these assertions. He labels himself not as a denier and not as a skeptic; rather he refers to himself as a "lukewarmer", a label that probably suits Bjorn Lomborg as well:

This is the “lukewarmer” school, and I am happy to put myself in this category. Lukewarmers do not think dangerous climate change is impossible; but they think it is unlikely.

He continues,

Barack Obama says that 97 per cent of scientists agree that climate change is “real, man-made and dangerous”. That’s just a lie (or a very ignorant remark): as I point out above, there is no consensus that it’s dangerous.

So where’s the outrage from scientists at this presidential distortion? It’s worse than that, actually. The 97 per cent figure is derived from two pieces of pseudoscience that would have embarrassed a homeopath. The first was a poll that found that 97 per cent of just seventy-nine scientists thought climate change was man-made—not that it was dangerous. A more recent poll of 1854 members of the American Meteorological Society found the true number is 52 per cent.

The second source of the 97 per cent number was a survey of scientific papers, which has now been comprehensively demolished by Professor Richard Tol of Sussex University, who is probably the world’s leading climate economist. As the Australian  blogger Joanne Nova summarised Tol’s findings, John Cook of the University of Queensland and his team used an unrepresentative sample, left out much useful data, used biased observers who disagreed with the authors of the papers they were classifying nearly two-thirds of the time, and collected and analysed the data in such a way as to allow the authors to adjust their preliminary conclusions as they went along, a scientific no-no if ever there was one. The data could not be replicated, and Cook himself threatened legal action to hide them. Yet neither the journal nor the university where Cook works has retracted the paper, and the scientific establishment refuses to stop citing it, let alone blow the whistle on it. Its conclusion is too useful.

He concludes,

None of this would matter if it was just scientific inquiry, though that rarely comes cheap in itself. The big difference is that these scientists who insist that we take their word for it, and who get cross if we don’t, are also asking us to make huge, expensive and risky changes to the world economy and to people’s livelihoods. They want us to spend a fortune getting emissions down as soon as possible. And they want us to do that even if it hurts poor people today, because, they say, their grandchildren (who, as Nigel Lawson points out, in The Facts, and their models assume, are going to be very wealthy) matter more.

Yet they are not prepared to debate the science behind their concern. That seems wrong to me.

As I said at the outset, Ridley's article is quite lengthy. The above quotes represent no more than about 5% of it. I've left out his examples, his more detailed arguments, and his references.

If you uncritically accept the pronouncements from the politicians at the Climate Conference in Trono, please, PLEASE read Ridley's piece. Even if you don't like it, even if you think he omits important information, even if you have a different set of subjective estimates of the probabilities he discusses, what he says in the article merits your attention.

The Tale of Six Barbecues

Over the past four years I have gone through six different barbecues that I can remember.

For decades, when we lived in single-family houses. We used a good-sized barbecue and had natural gas run out to it for every house we lived in.

But four years ago we moved to a high(ish)-rise condo building. My understanding is that provincial legislation bans using elevators to carry propane tanks. At the same time, refitting the natural gas line in our unit so I could run it out to our balcony would cost a small fortune. And I'm too impatient to wait for charcoal to get going. So we started with electric barbecues.

1. Our first electric barbecue barely got hot enough to warm up hot dogs. I have no idea what brand it was, but we got it from Canadian Tire, we returned it for a full refund, and they no longer carry whatever that model was.
2. Our second electric barbecue was a Dimplex. It seemed to work... sort of, but it too didn't get very hot. So we got rid of it and replaced it with ....
3. Another Dimplex. This replacement electric barbecue got reasonably good ratings on Amazon. It didn't really get as hot as I'd have liked, but it worked ok and had a nifty computer programme that helped guide me for cooking times. Of course those cooking times should have varied considerably, depending on the outside temperature and wind. We used it for several years and still have it (albeit in our storage locker as a backup). It's a good, solid barbecue, but it just doesn't get hot enough, really.
4. For some reason I decided to experiment with using a barbecue that uses wood discs. It might have been ok, but the smoke would drive our neighbours crazy if I used it much, and we tend to barbecue 3-4 times/week pretty much year-round. So we gave it away.
5. Thinking I might like more heat, I decided to try a small barbecue that uses propane canisters. I can carry these up the stairs in our building, and so I'm still ok legally, I think. The one I bought was a Master Chef, on sale for only $35 at Canadian Tire. We were quite pleased with the results. It heated quickly, it got hot, and things came out quite well. So, since that was just a trial before a major investment (aka expenditure on a consumer we-hope-durable), we gave this one away and bought...
6. A Napoleon Travel Q. So far we love it. It has cast-iron grills, which require careful seasoning and care, but the heat, the solidness (this one isn't likely to blow off the balcony in a strong wind), the evenness of the heat all make this a wonderful barbecue. I still have much to learn and relearn, but I think this one is a keeper.

 

Napoleon barbecue

portable barbecue

This Might Be Fun: The Economics of Search, Love, and One-Night Stands

I haven't taught at UWO for over 5 years, but out of the blue I recently received a request to present a "mock lecture" for incoming students in September.

I was wondering if you would be interested in delivering a mock lecture to the incoming first year students? The idea would be to give students an idea of what a real  lecture would be like ...

I have a real kick-ass lecture I can rework on "The Economics of Search, Love, and One-Night Stands." I've offered to give it. We'll see what happens.

Prescience? EclectEcon on the Euro 10 Years Ago

I did a Google search on EclectEcon+2005+Euro and was directed to this posting, written over a decade ago. The timing was all wrong in my piece (what's new?) but the nuggets of truth and prescience were there, too:

The continued success of the Euro as a world currency depends crucially on the fiscal discipline of each of the constituent gubmnts. If only a couple of the member country gubmnts run prolonged, serious fiscal deficits, those countries will put inordinate pressure on the Euro and/or threaten to withdraw from the common currency.

The countries will naturally claim that they want the flexibility to address short-run macro weaknesses in their economies. And that is exactly what is happening now.

European finance ministers are meeting in Brussels on Sunday to discuss changes to the Growth and Stability Pact governing the euro.
The agreement limits the size of a nation's budget deficit and has been criticised for not letting governments boost economic growth by spending more.

.... If France, Germany, and Italy are successful in getting the Pact relaxed, the growing individual country debts will put increasing pressure on the Euro. It might not happen for quite a few years, but the seeds are being sown for the coalition to break down. The Euro is, after all, the result a coalition with no single entity having the power to enforce it. Such coalitions can be unstable over time. As BrianF, who sent this to me, adds,

I think this is what's known in macroeconomic theory as a time-inconsistency, precommitment problem. Which in general parlance means that a committment from a politician is not worth the paper it's written on.

If this trend continues, the Euro will not be a good candidate to replace the U.S. dollar as a world currency reserve; foreign central banks, especially in Asia, will continue to hold U.S. dollars, but only because there is no good alternative, thus staving off the decline in the U.S. dollar that we might otherwise expect.

It is interesting that a decade ago, economists were more concerned about the lack of fiscal discipline in France and especially in Italy. Greece was under the radar for most economists, apparently. And yet the fiscal "instability" [aka bankruptcy] in Greece was already beginning to develop.

As I wrote back then, profligate nations had little incentive to rein in their borrowing and spending.

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Anti-Semitism in Greece

Blame the Jews? This report is shocking, maddening, distressing, and more.

In total, 67 percent of Greek respondents agreed with the majority of a list of anti-Semitic statements included in the survey. ...

According to the ADL poll, 90 percent of Greeks agreed with the statement that “Jews have too much power in the business world” and 85 percent agreed “Jews have too much power in international finance markets.”  ...

Over one-quarter of respondents also said they believe the number of Jews reported to have died in the Holocaust has been “greatly exaggerated.” One-third said Jews are “responsible for most of the world’s wars” and 41 percent agreed that “People hate Jews because of the way Jews behave.” 

The ADL poll is a follow-up to its 2014 Global 100 survey. Since 2014, the percentage of people holding anti-Semitic views in France, Germany, and Belgium has decreased. Each of these countries has recently experienced attacks on Jews. 

France had the most significant drop. Last year, 37 percent of respondents agreed with the majority of the list of anti-Jewish statements included in the survey. In the latest 2015 poll, just 17 percent agreed with the majority of the statements.

The poll also found widespread anti-Semitism among Muslims across Europe. Fifty-five percent agreed with the majority of anti-Jewish statements included in the survey.

However, European Muslims were still less likely to hold anti-Semitic views than Muslims in the Middle East, and significantly less likely to hold anti-Semitic views than the general population of Greece. [emphasis added]

Also see this in Haaretz:

In Greece, anti-Semitic viewpoints are aired frequently, particularly the notions that Jews control the global economy and politics. In 2012, when the Golden Dawn’s Kasidiaris read in Parliament from the anti-Semitic forgery “The Protocols of the Elders of Zion,” the reading drew no condemnation from the other lawmakers present.

Nor was there public condemnation when Golden Dawn slammed the recent visit by the American Jewish Committee’s executive director, David Harris, as a trip to ensure further “Jewish influence over Greek political issues” and safeguard the interests of “international loan sharks.”

Golden Dawn hasn’t been alone in expressing such sentiments. ...

Even the mainstream political parties have long histories of using anti-Semitic tropes.

“Greeks are fond of conspiracy theories, as they are steeped in conspiracy on a personal level,” Euthymios Tsiliopoulos, a journalist and political commentator, wrote on the popular current affairs website The Times of Change in the wake of the Karypidis scandal.

“As so many things are conducted through under-the-table, backroom deals, most naturally assume that the whole world is run in this manner,” he wrote. “As such, there is willingness to believe that the hardships the country and its inhabitants have undergone throughout the centuries is due to the machinations of foreigners. After all, it’s easier to believe this than to fix the perennial ills plaguing Greek society.”

 

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