Monday, May 30, 2005

Viva l'Evolución

Via QuickRob's Weblog:
"The wall between the reporter and the consumer is eroding. And, most fundamentally, the readers and the consumers are climbing that very wall and they are taking control of the flow of information. The filter is being removed from the system, and now the flow will be pure. What we do with it is up to us, but the new system…the blogging system, by it’s very nature should be able to sustain the purity of the information simply by the theory of evolution. What is false, and what is adulterated, will be discounted. A million minds at once will edit."
Kind of gives you a warm, fuzzy feeling inside, doesn't it?

Amnesty International has Lost All Respectability

During the Apartheid days, I had respect for Amnesty International. Well, not anymore.
"...Amnesty International urged foreign governments Wednesday to investigate and prosecute President George W. Bush..."
They have proven beyond a shadow of a doubt what moral retards they are.

Update: Captain's Quarters puts it succinctly,
"We elect our leaders, and we hold them accountable. Moreover, when we send our leaders abroad to interact with leaders of other countries, we expect those countries to extend normal diplomatic status, or to warn in advance when that status will not be extended. Violating that status by imprisoning our leaders and diplomats is an act of war against the United States. Those joining in Amnesty International's call for other nations to commit an act of war against us should be held politically accountable for their position."


It seems to me that controlling our borders would be a priority in winning the WOT, therefore, I'm with these guys: Minuteman Project, and these guys, too: Veterans for Secure Borders.

Here you will find an English translation of the al Qaeda training manual, wherein they are instructed to claim "abuse" upon release.

Here is a breakdown of the countries who armed Saddam's regime.

It wasn't very long ago that many prominent demonrats were making alarming claims about Saddam's WMD.

Let's not forget how the NY Times ran the story of the century, "Abu Ghraib," on their front page (almost all above the fold) for 32 consecutive days, yet they couldn't care less about the beheadings and other atrocities done by those on the other side.

Here is the text of the Geneva Conventions, which explicitly do NOT protect terrorists. To understand why the Geneva Conventions do not protect illegal combatants, please read this.

Here is the best 9-11 website ever created.

And finally, Fake but Accurate readers, your required reading for today: Orson Scott Card. Enjoy.

Saturday, May 28, 2005

Thinking of Homeschooling?

I am. I'd been trying to talk my wife into working with me to develop something like this for a long time now. I guess now we won't have to.

Newsweak is hiring!

Do you think I should apply?

In Observance of Memorial Day

Q & A about the Tomb of the Unknown Soldier.

Friday, May 27, 2005

Hey! Where's my Sitemeter?

I mean, there must have been like at least nine readers by now. No?

Good Essay

See? Not all liberals are bad.

Good Point

Why is it ok when an Arab Muslim desecrates the Koran and brags about it to the world, but not ok when the big bad infidel so much as touches a Koran? Would it be considered torture if the terrorists at Gitmo didn't have access to the Koran at all?

Thursday, May 26, 2005

Happy Birthday Larry

Ease up on those poor kiddies though, will ya?

Go to Hell Zarqawi

Too bad it couldn't have been death by Bubba.

Wednesday, May 25, 2005

Pearls of Wisdom from the German Ambassador, and a Response

Wolfgang Ischinger, German Ambassador to the United States, says:
"As older societies, we tend to think of ourselves as more experienced in the way societies evolve, and we tend to be skeptical of Americans who seem to think that if you believe hard enough, and you muster enough resources, you can change the world...In the last year or so, as we've engaged in discussions about the transformation of the Middle East and democracy, I have told my American friends that the region in this world that has seen the most transformation and change is Central and Eastern Europe--without shedding a drop of blood. So don't preach to us. And don't think transformative change will work according to mechanistic rules. This is very complicated. Changing the way people think often has to do with religious and cultural issues--we tend to think of them as long-term, and Americans think, Let's solve the problem in the next four years!"
I would like to respond:

You, Mr. Ischinger, must be the most hypocritical man on the planet. “Four years?” “Without shedding a drop of blood?” What the hell are you talking about? Was it not Germany that invaded Poland and launched the world into war, requiring the Americans to destroy the vile and cancerous national socialist (i.e., Nazi) movement in Europe? Come to think of it, wasn’t it Germany that started both World Wars? If Germany hadn’t, in its great experience and wisdom, invaded every country in its vicinity, those poor eastern and central European countries wouldn’t have had to exist in a Soviet slave state for the ensuing 50 years, but because of Germany, they did, and more than a few drops of blood were shed. Millions of human beings in these central and eastern European states were butchered (and not just Jews) and the “experienced” Germans are the ones who put them under Stalin's knife in the first place. And do you actually imagine that it was the Germans that caused the U.S.S.R. to splinter, allowing the eastern bloc states to regain their identities and become free nations again? Hilarious! It was the Americans who provided economic assistance both to Russia and the eastern bloc countries in their transition towards democracy. The Cold War may not have had many spectacular battles (though the Korean and Vietnam Wars do ring a bell), but it was expensive and the United States bore its financial burden almost exclusively. The Europeans as a whole couldn’t even handle that bloody little spat in their backyard, in Bosnia and Kosovo. You had to call on the Americans to fix things. Why should we Americans shed our blood in Bosnia and Kosovo, we asked? Because Europe is a tinderbox and the conflict in this tiny part of Europe could spread. At great cost, both financially and in blood, Americans spent their treasure and continue to do so to protect European interests. Now, not after four years but after 60 years, the US has plans to finally pull its military out of Germany itself and guess who is kicking and screaming about it… the Germans! Talk about changing people’s minds! Guess what, ass-wipe, we Americans (our military in particular) have been changing the world through great sacrifice, through blood, sweat and tears for a very long time now, not that you would give a damn. Don’t lecture us, Mr. Ischinger.

Al Qaeda - Saddam Connections

In the run-up to the November '04 elections, this was a hot topic and the MSM in their bid to oust Bush had pretty much 'concluded' that there was no connection, common sense and facts be damned. Such discussion seems to have faded more recently. This blogger, at least, is still on top of it.

Tuesday, May 24, 2005

Our media is selling hopelessness.

I am currently posting from the beautiful Pacific Ocean, but one week ago I was in Potter County, Pennsylvania for a funeral – no cell phone connectivity, no internet (Wi-Fi or otherwise), almost no TV. After an incredibly long day (two days with almost no sleep thanks to greeting and grieving with nearly every single resident of small-town, USA, and thanks also to the incredible wideness of this country of ours), I finally relaxed in my motel room (one of the two motels in Potter County, PA) and turned on the idiot box, and flipped through the channels (all 5 of them) and the only thing even mildly interesting on the boob tube is this See-BS evening “News” story on, I kid you not, “BS” (I was pretty tired at the time, but I think they used the actual word “bull-shit” and bleeped out the profanity about a thousand times). I’m not really surprised that no one in the blogosphere picked up on this event since the only people who still watch CBS News are those who have no other alternative, like the residents of Potter County. At any rate, this was Sunday evening, 5/15/05. Was this a self-parody, I wondered? Apparently not. This story seemed the absolute pinnacle of hypocrisy, but maybe I should not be so quick to judge. The upshot of the story seemed to be that we are, all of us, swimming in a sea of BS and those in power tend to be the best BSers (using as examples Clinton & Bush – Bush being the worse of the two because, get this, he actually is stupid enough to believe his own bull-shit). The implication was that there is nothing but bullshit in our modern world at least as portrayed by politicians and the media, nothing of substance, no truth, no reality, no hope of any kind, so we should just sit back, relax, and enjoy the bull-shit. All any of us are capable of is eating and shitting; actually believing in anything is just plain stupid.


Personally, if I want BS I’ll watch Comedy Central, but hey, maybe CBS producers have a plan. Perhaps See-BS is attempting to cement its position as America’s ultimate King of bull-shit, and defending itself from stiff competition from the likes of Newsweek magazine. Maybe there is still time for the New York Times or CNN to catch up. Who will win this race for the bottom of the port-a-potty? Has CBS become the official church of bullshit? Is it any wonder that nobody is watching anymore?

Oh, and JUST IN CASE there was ANY MISUNDERSTANDING or DOUBT WHATSOEVER about Newsweek's DUPLICITY, check out THIS JAPANESE EDITION of NewsWEAK. On its front cover, the American FLAG is proudly displayed in a TRASH can and the headline, roughly translated from Japanese, states that AMERICA is DEAD. Great, now I GET IT. Koran in the toilet - BAD, American flag in the garbage - GOOD. Nice of them to clear up any lingering confusion for us. No? And finally, Newsweak went on Al-Jizeera to explain their supposed retraction of their published story about US military Koran flushing, but what did the Newsweak spokesman say about the story? That's right! He said the story was FAKE BUT ACCURATE! Gotta love it. (Sorry about the caps.)

Filibuwha? I trust these guys as much as I do the North Koreans.

Could someone please explain to me what the repubs get out of the judicial filibuster compromise agreement? (See Roger L. Simon for the text. The comments are interesting, too.) What we seem to have here is seven RINOs selling out their party for a little media praise. "Good doggie." Fifty-five republicans in the senate and they have to get the 45 demonrats' permission to vote on a judicial nominee? Bah! So much for democracy. When it's 60 repubs in '06 will it make a difference you think? I wonder. How badly do the demonrats want to die as a serious political party? Do they honestly believe they can continue as the Party of No? Their media support isn't working anymore (more on that later). I'll tell you one thing, I am officially joining Patterico in his pledge: The next time John McCain runs for any elective office, I pledge to support his opponent. I know how scary that sounds, but I have had enough. If it's him against Darth Rodham in '08, I'm voting libertarian. I've had it. Any other republican, fine, but not McCain or any of these other seven RINOs (John Warner, Mike DeWine, Susan Collins, Olympia Snowe, Lindsey Graham, and Lincoln Chafee) who gave the demonrats what they wanted and got nothing of substance in return. Who are they to decide that these three judicial nominees get a vote and the rest do not? And Frist, he sure demonstrated what a leader he is, didn't he? What a hero. NOT. I wish I had written this letter. At any rate, tons of info and commentary on today's bit of political suicide out there in the blogosphere. Even Steven Den Beste is talking.

Thursday, May 19, 2005

A political quiz

My result:
Anarchism 100%
Republican 83%
Green 42%
Socialist 33%
Communism 25%
Democrat 17%
Nazi 0%
Fascism 0%

Here is the quiz.

Wednesday, May 04, 2005

I got Mail.

Thought I'd post a response, so all three of you can see that I can write a cohesive thought:

On March 29, TC wrote:
"One could... argue that the higher taxation of dividends has the net effect of being a social insurance cost on dividend earning stock investments."

This idea you have that a tax can be akin to an insurance premium to pay for a sort of social insurance policy is interesting. Perhaps we can think of an example that would be more clear-cut though, because the dividend tax as insurance premium analogy doesn't seem to work for the examples you listed. You cite as examples the S&L bailout and Long Term Capital Management. The problem is that neither of these is an example of a corporation being bailed out by the government. The Savings and Loan institutions were required to pay deposit insurance premia to federal regulators (the now defunct FSLIC) in exchange for deposit insurance. As is still the case today, the money deposited in a bank is insured by the federal government for up to $100,000. If you happen to have $200,000 that you would like insured by the federal
government, then you should deposit $100,000 with one bank and deposit the other $100,000 in a different bank. In any case, if the deposit insurance fund is insufficient to meet banks' insurance claims, then tax revenues are used to "bail out" the remaining bank liabilities (deposits), as they were in the 1980s; the taxpayer is tagged as the "lender of last resort" due to the structure of bank regulation. (By the way, in the 1980s all banks paid the same deposit insurance premium, perhaps encouraging some of the riskier banks to take on excessive risk as there was no penalty for doing so. Since 1990, deposit insurance premia have been tied to the riskiness of a bank's asset portfolio.) Because of deposit insurance and due to the fact that banks are the most heavily regulated businesses in the U.S., stockholders, depositors and other stakeholders have less of an incentive to monitor banks than they would ordinary corporations. Banks are sometimes bailed out for
fear of the damage that bank failure would cause to the local economy if the bank is deemed "too big to fail."
LTCM I believe was a partnership, not a corporation, and never paid a dividend. And it wasn't bailed out by the federal government. Alan Greenspan may have played a part in the negotiations between LTCM and its creditors, but there was no "bail out" from the Fed. The problem with LTCM was that it failed to take into account the high kurtosis of asset price deviations (the distributions of asset price changes have "fat tails" compared to Gaussian distributions). A lot of things had to go wrong at the same time, but then, as anyone who has played blackjack knows, the chances
of losing ten hands in a row are higher in reality than on paper. For the most part, corporations are usually allowed to fail and are very rarely bailed out. In the recent past, our federal government did not lift a finger to bail out such large companies as WorldCom and Enron. Granted, there were social costs to these bankruptcies; the employees and retirees of Enron were particularly hurt due to the fact that corporations are required to manage their employees' pension funds and health-care benefits. These pensions should have been diversified but were not. The government is footing the bill for the litigation involving Andrew Fastow (Enron CFO), Jeffrey Skilling and a number of other senior executives of troubled
companies - I'm not sure if this qualifies as the kind of "social insurance" policy you were referring to though.
I agree with you that dividend taxation is not the only relevant factor or necessarily even a dominant feature in explaining the "tech bubble," but it certainly did contribute to a lack of dividend paying stocks and hence to the excessive decline in stock prices. Those stocks that do not pay dividends had on average a much larger decrease in value than those stocks which do pay dividends. It is troubling to me that investors did seem to ignore "fundamentals" for a period of time in the 1990s as you say; investors exhibited what the Federal Reserve called "irrational exuberance."
As I recall, at that time people would use arguments like, "It's a new world with new technologies and higher growth rates. One should not expect the future to look like the past. Valuation models need to adapt." Most economic models and asset valuation models are based on an assumption that market participants are rational. Democratic governance is likewise based on a similar assumption. It troubles me a great deal when such assumptions are apparently unsubstantiated (ex post).
There seem to be plenty of social innovations that provide a mix of both beneficial and detrimental incentives. For example, car insurance is considered a good thing that any rational person would want to have. However, it could be argued that the existence of car insurance has the net effect of increasing the number of car accidents because part of the risk involved in driving is borne by the insurance company. One could for example make the argument that, if car insurance policies did not exist, then people would drive more carefully. Similarly, if our bank deposits were not insured by the FDIC, we all would pay more attention to our banks' activities. So these things frequently have both positive and negative consequences. The positives outweigh the negatives in the things that we keep, one would hope.
I found it particularly interesting that you brought up the Orange County bankruptcy because it just so happens that the Financial Markets and Institutions class that I currently teach is covering repurchase agreements right now, which is the financial contract that was "blamed" for the bankruptcy. What happened, as I understand it, is as follows: Robert Citron had been repeatedly reelected as Treasurer of Orange County
because he had produced average annual returns of 9% on a fund containing the reserve money of the municipalities (school districts, transportation authorities, etc.) located in Orange County. Mr. Citron achieved this by means of a strategy using repurchase agreements and leverage. For example, in 1994 the fund purchased Treasury notes with the yield of 4.61%. These were financed using six-month repurchase agreements (repos) at 3.31%. A repurchase agreement (repo) is a fully collateralized loan in which the collateral consists of marketable securities. As repo rates rose with the increase in the general level of interest rates, the positive spread between
financing and investment rates declined and eventually turned negative. That is, the cost of borrowing exceeded the return from investment at some point in 1994. In December 1994, when the fund declared bankruptcy, the repo rate had risen to 6.75% p.a., resulting in a negative spread of 2.14% p.a. on this transaction.
Sadly, this transaction was not alone. Citron leveraged a $7.4 billion investment fund into a $14 billion portfolio using repo transactions (by buying Treasury securities and using them as collateral to borrow money to buy more securities). As long as interest rates stayed low or fell, the strategy was profitable. It seemed like a winning investment strategy, but Mr. Citron did not recognize the interest rate risk exposure in his strategy. When interest rates moved up, the losses in market value of the securities used as collateral for these repo transactions accumulated. Upon hearing of Orange County's bankruptcy filing (triggered by a missed $200 million payment on a repo transaction), most repo counterparties quickly sold their collateral, thereby recouping their principal. An exception was Merrill Lynch, which was Orange County's adviser and largest counterparty. Merrill held onto its over $1 billion of repo collateral even as other repo counterparties liquidated their holdings. Merrill's efforts to avoid the unraveling of Orange County's portfolio
didn't help though. In January 1995, Orange County filed a $3 billion lawsuit accusing Merrill of "wantonly and callously" selling highly risky securities to the municipal fund in violation of state and federal laws.
It just makes me wonder whether our elected officials should maybe take some finance courses. There are many other examples of financial disaster caused, at least in part, by misunderstanding the risks involved (LTCM, the Malaysia meltdown, Enron, Barings Bank, etc.). Often times, long term risks are exacerbated because the focus is on minimizing short term risks. I would agree with you that the assumption of rationality may be contentious.
- dw