EclectEcon

Welcome to the PLO, Donald. We don't mind if you like your steak well-done with ketchup

Just don't try to force all of the rest of us to eat it that way.

The Philistine Liberation Organization, of which I appear to be the de facto chair, celebrates differences in tastes and preferences. From our original mandate:

The Philistine Manifesto

I have been subjected to the biases and special pleadings of the artsy culture vultures long enough. They sneer at anything which isn't in their own mold (mould?) of avant-gardishness. They perpetuate stupid jokes by laughing at people who quite seriously say, "I may not know much about..______... but I know what I like."

It is time for the rest of us to revolt against this claptrap of self-indulgent behaviour which passes itself off as "the actualization of one's self potential," and which somehow has, unfortunately, [in Canuckland, at least] bedeviled enough politicians that fully 65.7% of our tax dollars go to supporting these alleged artistes through direct grants and purchases of junk [Voice of Fire - - need I say more?] that any sensible person would pay someone else to haul off to the municipal landfill site. It is time for a new organization to be formed to aid this revolution. To that end, I hereby announce the formation of

The P.L.O.

 The Philistine Liberation Organization welcomes as new members those who support this cause. The basic tenets of the PLO are divided into two general categories: things we like and things we don't like. An overall score of 80% qualifies you for membership. ....

 

The purpose of our organization, it must be made clear, is to promote tolerance and open-mindedness -- to lampoon arrogance and self-indulgent pomposity. We don't really care if you like Shostakovich, escargot, and Birkenstocks.

We also don't really care if you like Neil Diamond, pizza, and Kodiak Grebs. We do, however, become disturbed if you try to tell us what we should like; and we have apoplexy if you try to get us to pay for what you think we should like.

Want to join the P.L.O.? ok, you're probably already a member then. Want to add to the tenets? Mail your suggestions to me, and I'll keep a list. My e-mail address is

[email protected]
Don't miss the reviews written by Ian Klymchuk.
And you will definitely want to look into attending our next annual conference!!

 

Bright Sox

I've been wearing bright, patterned sox almost exclusively for several years. I guess my doing so means something:

Despite our conforming attitudes, a study published in the Journal of Consumer Research^[1] investigated the theory that people who are nonconformists can potentially be viewed as being more high status and more competent than those who conform to social norms.

So what does this say about your choice of wearing bright neon, rainbow-striped, or leopard-print socks? Well, it found people who have shown to deliberately choose to wear whacky socks, are seen as having increased status and competency in the eyes of others. In other words, people have the potential to see you as more brilliant, creative and successful.

Some key words in that quote: "potentially" and "potential". Some of us don't live up to our potential. But maybe wearing bright sox signals some potential; or maybe doing so is just a false signal used by some of us to signal something we're lacking and the bright sox are just wistful signs from wannabes.

Previous posts with photos of my socks:

Are Socks the New Neckties?

More Socks

More on Socks

I have lots more bright sox now than I did two years ago. In fact I actually wore out some of the sox in those photos, I wore them so much.

 

Surf's Up

Yesterday morning I woke early and looked out the window. Yea!! Lots of new snow on the lawn in front of our building. So I dressed quickly and went outside to do some snow stomp art. I knew the temperatures would rise this coming weekend, and that made me think of surfing. The street lamps were still on, and the sun hadn't risen yet.

As I said, I expected the image wouldn't last very long because the forecast says we will have temperatures up over 10C (50F)* this weekend. But I hadn't counted on the wind blowing so much of the snow away.

It did, though, so I went out about 10 am to fix it up a bit.

The wind continued, though. I figured the whole thing would be gone by evening, but here's a photo I took of the work at about 11pm last night:

The writing was gone, but the surfer dude in the pipeline survived in great shape!

And he is still there this morning!

But he is fading fast.

True story: I taught at the University of Hawaii in the autumn of 1986. I regularly went to the beach between classes and learned to surf. Students in my afternoon law & economics course would laugh and point at the sand on my feet "We know where you were!"

I never was very good at surfing, but it was fun and it was great upper body exercise. We also spent a LOT of time at Bellows beach using body boards and catching waves. So much fun!

*Reminder: C = Canadian, F = foreign when talking about temperatures.

My previous snow stomp art:

Surf's Up (this post)

 

Diagonally Warped in a Parallel Universe, Part 2

      Diagonally Warped in a Parallel Universe

      Pikachu

      Happy New Year, 2017

      O Tannenbaum

      Nativity Scene

Special Weather Statement

Think Tropics

Qubix

Valentine, 2016

Paisley'd Circles

Happy New Year, 2016

The House of the Rising Sun

Easter Eggs

A weak pattern in the blowing snow.

The same pattern after some melting

New Year's Champagne

Tiptoe Through the Tulips

Happy Valentine's Day

Cabaret

A Christmas Tree (my first effort)

People Respond to Incentives (part 17zillion)

The basic premise of economics (and many other social sciences) is that "People Respond to Incentives". Here is another example (via Jack):

[W]hile Manitoba offers legal aid to refugees, the provincial government confirmed in an email that Saskatchewan is one of four provinces that does not. ...

"If someone is making a refugee claim in Saskatchewan they have to spend their own money from their own private funds to hire a lawyer and they simply do not have any money," [Winnipeg attorney] Khan said. 

The lack of aid is leading many refugees to chose Manitoba over Saskatchewan, he said. 

 

Never Reason from a Price Change

Prices change. Sometimes the price change is caused by a shift in supply, sometimes it is caused by a shift in demand, and sometimes both supply and demand change, leading to uncertain ambiguous results.

We try to drill these basics of supply and demand over and over in our introductory economics classes. But these lessons seem to escape many students once the exams are over. And the lessons seem to escape too many economists who too often reason from a price change rather than looking for what underlying factor(s) may have caused the price change.

Scott Sumner at EconLog has an excellent brief post about this issue.

The questions . . .

Would it be a good thing if interest rates rose?
Would it be a good thing if copper prices rose?
Would it be a good thing if the dollar appreciated?

. . . are all basically meaningless. In all three cases, the prices never change for no reason at all. In each case the real question is whether the thing that causes the price to change makes us better off or worse off.

In all three cases, the price/interest rate/exchange rate might rise due to strong economic growth in America. That would probably be a good thing. The exchange rate and the interest rate might rise due to tight money. That would be a bad thing if tight money were not appropriate at that time. Copper prices might rise because of civil wars in copper producing nations. That would be a bad thing.

This isn't just a minor problem; the economics profession is waste deep in reasoning from a price change...

Sumner adds some examples about interest rates.

But the problem is a serious one: when a price changes, don't ask if it is good or bad because the correct economics answer is, "It all depends". Ask why the price changed. And once that answer is clear(er), you'll have a better idea of whether it is good or bad ... and for whom.

Passive Index Funds Win Again

Here is more evidence that the best use of investment funds for the long term is low-cost (low management fees) index funds and passive management. The big endowment funds that used active management were out-performed over the past five and ten years by smaller endowment funds that relied more heavily on passive management, index funds, and low MERs [Management Expense Ratios].  The real take-away nugget appears well into the article from the NYTimes:

Vanguard said a simple mix of index funds with 70 percent in equities and 30 percent in fixed-income assets delivered an annualized return of 7.1 percent over the past five years, and 6.1 percent over the past 10. For a mix of 60 percent stocks and 40 percent bonds, the returns were 6.7 percent for five years and 6.1 percent for 10.

By comparison, the annualized returns for the billion-plus endowments were 6.1 percent for five years and 5.7 percent for 10.

Hedge funds, however, have successfully marketed themselves as offering higher risk-adjusted rates of return, in part because they supposedly minimize losses in down years. But according to Vanguard’s calculations, its simple, low-cost model portfolios have provided higher returns even after adjusting for risk in eight of the past 11 years.

I would love to be able to buy into such a set of mutual funds. But I can't without massive exposure to tax liabilities from the freakin' IRS. Grrr.

I know there are some people who beat the market consistently. They (and their investors) believe they are better/smarter than the hoi poloi of the marketplace. It's also possible they are just luckier: if 10,000 people flip a coin a hundred times each, a few just by chance will get strings of 20-30 heads in a row and 60-70 heads overall.

 

Ledaig Is Now Available from the LCBO!!!

As many of you may recall, my favourite scotch BY FAR is Ledaig, a moderately peated 10-year-old single malt from the Tobermory (Mull) distillery (see this, this, this, and this).

Recently I was in the local liquor monopoly (aka the Liquor Control Board of Ontario [LCBO]) and asked if there was any Ledaig available. They went on their computers and LO! there are about 40 bottles available in Ontario. I had them order me a case of six bottles, and I picked them up yesterday.

For those of you in Ontario, you can also order it online and have it delivered to a local LCBO outlet. Here is the link.

This is amazing scotch. It's about half the price of Lagavulin, and better (for my tastes, noticeably better). And the 46.3% alcohol provides a very nice bite that I really like.

Order a bottle or two now if you live in Ontario (elsewhere, like Houston or Miami or Alberta, you can just find it on the shelves of many liquor stores). I'll give you a fair chance -- I'll wait a week or so before ordering more.

 

The Nature of Infinity?

There is an infinite number of exact replicas of me typing on a Macbook right now.

There is also an infinite number of exact replicas of me typing on window-based machines right now.

There is, generally, an infinite number of exact replicas of me doing an infinite number of different things right now.

And that's true for every being in the universe.

All prompted by this: