Tuesday, December 30, 2008

Getting The Analogies Correct

Uncommon Descent:

ID and the Trajectory of Observational Resolution

If I may be so bold, I would like to excise a commenter’s comment from Denyse’s thread, The canals that just had to exist on Mars, and redirect to what I consider to be the greatest weakness of Darwinian orthodoxy, and that is the trajectory of the evidence, which is almost never addressed by anti-ID advocates.

Regarding the notion that “canals” were early indicators of design on Mars, commenter leenibus submitted:

E.M. Antoniadi, with the aid of improved technology, realized that the appearance of design was false - the “canals” were fuzzy shapes and thus natural features. Unfortunately, while it may be a good example of mindset biasing views, it is hardly a ringing endorsement for those wishing to see Intelligent Design in nature!

The problem is that the exact opposite is the case concerning biological systems. With the aid of improved technology, the formerly fuzzy “canals” of biology (Darwin’s blobs of gelatinous combinations of carbon) are not becoming fuzzier and more easily explained by non-ID theses — they are now known to be high-tech information processing systems, with superbly functionally integrated machinery, error-correction-and-repair systems, and much more that surpasses the most sophisticated efforts of the best human mathematicians, mechanical, electrical, chemical, and software engineers.

To put commenter leenibus’s comment in proper perspective regarding the trajectory of observational evidence concerning the canals on Mars, I would like to submit the following:

The proper analogy would be that with increasing telescope power and other sophisticated analytical capabilities, we could observe that the canals on Mars were supported by suspension bridges, that the water was redirected to hydroelectric plants equipped with generators, that there was a power grid that distributed the power all over the planet, and that there were sophisticated software programs that controlled the distribution of the electrical power and synchronized it all.

This is what we observe in living systems, only raised to the Nth power — and N is very large.

Luck Or Skill?

Clever experiment detailed here.

Monday, December 29, 2008


“If you don’t read the newspaper, you are uninformed. If you do read the newspaper, you are misinformed.”

--Mark Twain

H/T The Anchoress, who uses the quote to begin a post about yet another blatant media double-standard.

There Are Some Blatantly Obvious Truths That Materialist Science, Cannot, Even In Principle, Give Us

Interesting thought experiment highlighted here:

Philosopher Frank Jackson posed a thought question in 1982 that clarifies the problem that qualia poses for the strict materialist approach to the mind-brain question. It is framed as an epistemological problem. Materialism claims that the physical facts about mental states are all the facts there are. We may not understand all the material facts now (we certainly don’t ), but there are no facts about mental states that are not, in the final analysis, reducible to material facts, such as neurotransmitters, neurons, axonal electrochemical gradients, etc. Can materialism really provide all that can be known about color?

Jackson called his thought question "Mary’s Room" (1), and it has since come to be known more generally as the ‘Knowledge Argument’:

Mary is a brilliant scientist who is, for whatever reason, forced to investigate the world from a black and white room via a black and white television monitor. She specializes in the neurophysiology of vision and acquires, let us suppose, all the physical information there is to obtain about what goes on when we see ripe tomatoes, or the sky, and use terms like ‘red’, ‘blue’, and so on. She discovers, for example, just which wavelength combinations from the sky stimulate the retina, and exactly how this produces via the central nervous system the contraction of the vocal cords and expulsion of air from the lungs that results in the uttering of the sentence ‘The sky is blue’. (…) What will happen when Mary is released from her black and white room or is given a color television monitor? Will she learn anything or not?

Jackson believed that Mary did learn something new: she learned what it was like to experience color.

It seems just obvious that she will learn something about the world and our visual experience of it. But then is it inescapable that her previous knowledge was incomplete. But she had all the physical information. Ergo there is more to have than that, and Physicalism [materialism] is false.[my brackets]

Many philosophers have ventured materialistic hypotheses to explain qualia in an effort to salvage the materialist paradigm, and Jackson himself later in life came to accommodate materialism (grist for future posts). But in the view of most philosophers of the mind, the Knowledge Argument represents a profound problem for any strict materialist solution to the mind-body problem. When we experience qualia, we know something that is not material knowledge. Therefore, the mind cannot be explained completely by materialism. The fact that we experience qualia is difficult to elide, and there is nothing in materialistic explanations, and nothing in neuroscience, that invokes subjective experience.

Yup. If somehow we didn't already know we were conscious, none of the facts of neuroscience would give us the hint that we were, since these facts would be the same regardless of the existence of consciousness (which they must be on the materialist assumption that consciousness cannot act as a cause separate and independent from the merely physical). All of the facts of materialist neuroscience are just as consistent with the non-existence of consciousness, and hence cannot imply or explain consciousness. So we have a brute and obvious fact of reality that materialist science is wholly incapable of explaining.

To the foolish, this is a cause for complaint.

Experts Predict This Post Will Be Instalanched

Trust the experts.

Friday, December 26, 2008

Tuesday, December 23, 2008

Come On Down To Honest Ben's!

When will the madness ever end? Mish details how the Fed is setting itself up to become the number one auto dealership. And really, isn't that what the American Republic is supposed to be all about?

Monday, December 22, 2008

Feliz Navitoss!


Get Out The Stradivarius Violins. And Set Them On Fire.

Very interesting article in Vanity Fair about the collapse of the new Gilded Age.


The New Math

Most 60-year-old ex–Lehman Brothers bankers likely squirreled away enough to at least scrape by on a couple of million a year. As for the 25-year-olds, they never earned enough to have much to lose. But the mid-30s or mid-40s Lehman banker who lived up to his high compensation—or beyond it—is reeling, hurting, and possibly bankrupt.

One Sunday evening in October, a former Lehmanite in his mid-30s settles into a velvet banquette at the Gramercy Park Hotel’s elegant Rose Bar. At first he’s circumspect. But after a couple of Johnnie Walker Blacks on the rocks, he opens up.

“Let’s take a guy who makes $5 million a year,” the banker suggests. “He’s paid two and a half million dollars of that in equity compensation”—Lehman Brothers stock. Plus he gets to buy that stock at a 30 percent discount, so he’s really getting $3.25 million in stock. “Plus appreciation? Over five years? That’s $25 to $30 million!

“Then let’s say a guy in that position borrowed $5 million against the $30 million in stock. It would seem a very conservative loan, right? Until the $30 million goes down to zero, which is what happened. So now he’s negative $5 million.”

True, that same Lehman banker got the other half of his compensation in cash. The banker nods. “For five years, he made two and a half million dollars a year in cash. So that’s twelve and a half million dollars. But of course he’s had to pay more or less 50 percent in taxes, so divide that and he’s got six and a quarter million. He’s probably spent that money over those five years—$1 million a year, it’s not so hard to do, right? So he has nothing—and he has to repay that $5 million loan.”

A month before the bankruptcy, the banker muses, his peers were complaining about the $10,000 or $20,000 they had to pay for lifetime dibs on the best season tickets in the New York Giants’ new stadium. But they were paying. They were complaining about private-school tuitions. “But it was actually a way of saying, ‘I’m rich—rich enough to afford it.’

“The day Lehman went bankrupt, people realized they were going to get no bonuses, no severance, and no equity. Oh—and no health care. And no salary.”

So far, many seem more stunned than angry, or even timidly hopeful now that Barclays, the English bank, has bought much of the firm and offered shell-shocked Lehmanites their jobs—for now. Peter J. Solomon, 70, a former vice-chairman of Lehman Brothers who runs his own investment-banking firm, says, “What I see in the Lehman people is not enough bitterness. They’re still there, they have three months, Barclays is offering them jobs for a while. But that won’t last for most of them. You’re going to see the biggest impact in the first quarter of next year.”

At least the thirtysomething banker in the Rose Bar isn’t married with kids.

Alexandra Lebenthal, a New York–based wealth manager for investors with between $2 million and $20 million in assets—the modest to mid-level rich—offers a keenly authoritative portrait of a thirtysomething Lehman banker, married with kids, in a guest column called “What It Costs” on the Web site NewYorkSocialDiary. Blake and Grigsby Somerset are fictional, their finances all too plausible.

Before Lehman’s stock began to plummet, Lebenthal suggests, Blake’s annual compensation was $9.5 million—much of that in company stock. He was carrying a $2 million loan used for a house in the Hamptons, but felt perfectly able to afford his annual expenses: the Park Avenue apartment maintenance ($120,000); the Hamptons house mortgage ($75,000); the nanny and driver ($100,000); his wife’s clothing ($100,000); the personal trainer three times a week ($18,000); food, including restaurants ($30,000); charitable benefits and other nonprofit causes ($200,000); private school for three children ($78,000); Christmas in Palm Beach ($15,000); spring in Aspen ($15,000); and a wedding-anniversary diamond necklace for Grigsby ($50,000).

At least Blake has been hired on by Barclays. But his Lehman stock portfolio is now worthless. He and Grigsby have to cut their annual living expenses from about $1 million to a fraction of that, and do it in ways that don’t show, for the worst—the worst—would be the public disgrace of falling out of their social class.

First to go: vacations, the trainer, the driver, and entertaining. No restaurants, no shopping excursions, no new ball clothes for Grigsby (last year’s will have to do). But, for now—for appearances—the Somersets will scrimp to keep the kids in their schools, and the nanny, and the Hamptons house. For now.

Just In Case You'd Like A Poster To Illustrate Things

This does a pretty decent job of spelling it out, although the indicated endpoint is just the beginning of something worse.

"Money And The Crisis Of Civilization"

Some quite good rational analysis and insight that gets a bit too "New Agey" at the end.

It begins:

Suppose you give me a million dollars with the instructions, "Invest this profitably, and I'll pay you well." I'm a sharp dresser -- why not? So I go out onto the street and hand out stacks of bills to random passers-by. Ten thousand dollars each. In return, each scribbles out an IOU for $20,000, payable in five years. I come back to you and say, "Look at these IOUs! I have generated a 20% annual return on your investment." You are very pleased, and pay me an enormous commission.

Now I've got a big stack of IOUs, so I use these "assets" as collateral to borrow even more money, which I lend out to even more people, or sell them to others like myself who do the same. I also buy insurance to cover me in case the borrowers default -- and I pay for it with those self-same IOUs! Round and round it goes, each new loan becoming somebody's asset on which to borrow yet more money. We all rake in huge commissions and bonuses, as the total face value of all the assets we've created from that initial million dollars is now fifty times that.

Then one day, the first batch of IOUs comes due. But guess what? The person who scribbled his name on the IOU can't pay me back right now. In fact, lots of the borrowers can't. I try to hush this embarrassing fact up as long as possible, but pretty soon you get suspicious. You want your million dollars back -- in cash. I try to sell the IOUs and their derivatives that I hold, but everyone else is suspicious too, and no one buys them. The insurance company tries to cover my losses, but it can only do so by selling the IOUs I gave it!

So finally, the government steps in and buys the IOUs, bails out the insurance company and everyone else holding the IOUs and the derivatives stacked on them. Their total value is way more than a million dollars now. I and my fellow entrepreneurs retire with our lucre. Everyone else pays for it.

This is the first level of what has happened in the financial industry over the past decade. It is a huge transfer of wealth to the financial elite, to be funded by US taxpayers, foreign corporations and governments, and ultimately the foreign workers who subsidize US debt indirectly via the lower purchasing power of their wages. However, to see the current crisis as merely the result of a big con is to miss its true significance.

I think we all sense that we are nearing the end of an era. On the most superficial level, it is the era of unregulated casino-style financial manipulation that is ending. But the current efforts of the political elites to fix the crisis at this level will only reveal its deeper dimensions. In fact, the crisis goes "all the way to the bottom." It arises from the very nature of money and property in the world today, and it will persist and continue to intensify until money itself is transformed. A process centuries in the making is in its final stages of unfoldment.

Money as we know it today has crisis and collapse built into its basic design. That is because money seeks interest, bears interest, and indeed is born of interest. To see how this works, let's go back to some finance basics. Money is created when somebody takes out a loan from a bank (or more recently, a disguised loan from some other kind of institution). A debt is a promise to pay money in the future in order to buy something today; in other words, borrowing money is a form of delayed trading. I receive something now (bought with the money I borrowed) and agree to give something in the future (a good or service which I will sell for the money to pay back the debt). A bank or any other lender will ordinarily only agree to lend you money if there is a reasonable expectation you will pay it back; in other words, if there is a reasonable expectation you will produce goods or services of equivalent value. This "reasonable expectation" can be guaranteed in the form of collateral, or it can be encoded in one's credit rating.

Any time you use money, you are essentially guaranteeing "I have performed a service or provided a good of equivalent value to the one I am buying." If the money is borrowed money, you are saying that you will provide an equivalent good/service in the future.

Now enter interest. What motivates a bank to lend anyone money in the first place? It is interest. Interest drives the creation of money today. Any time money is created through debt, a need to create even more money in the future is also created. The amount of money must grow over time, which means that the volume of goods and services must grow over time as well.

If the volume of money grows faster than the volume of goods and services, the result is inflation. If it grows more slowly -- for example through a slowdown in lending -- the result is bankruptcies, recession, or deflation. The government can increase or decrease the supply of money in several ways. First, it can create money by borrowing it from the central bank, or in America, from the Federal Reserve. This money ends up as bank deposits, which in turn give banks more margin reserves on which to extend loans. You see, a bank's capacity to create money is limited by margin reserve requirements. Typically, a bank must hold cash (or central bank deposits) equal to about 10% of its total customer deposits. The other 90%, it can loan out, thus creating new money. This money ends up back in a bank as deposits, allowing another 81% of it (90% of 90%) to be lent out again. In this way, each dollar of initial deposits ends up as $9 of new money. Government spending of money borrowed from the central bank acts a seed for new money creation. (Of course, this depends on banks' willingness to lend! In a credit freeze such as happened this week, banks hoard excess reserves and the repeated injections of government money have little effect.)

Another way to increase the money supply is to lower margin reserve requirements. In practice this is rarely done, at least directly. However, in the last decade, various kinds of non-bank lending have skirted the margin reserve requirement, through the alphabet soup of financial instruments you've been hearing about in the news. The result is that each dollar of original equity has been leveraged not to nine times it original value, as in traditional banking, but to 70 times or even more. This has allowed returns on investment far beyond the 5% or so available from traditional banking, along with "compensation" packages beyond the dreams of avarice.

Each new dollar that is created comes with a new dollar of debt -- more than a dollar of debt, because of interest. The debt is eventually redeemed either with goods and services, or with more borrowed money, which in turn can be redeemed with yet more borrowed money... but eventually it will be used to buy goods and services. The interest has to come from somewhere. Borrowing more money to make the interest payments on an existing loan merely postpones the day of reckoning by deferring the need to create new goods and services.

The whole system of interest-bearing money works fine as long as the volume of goods and services exchanged for money keeps growing. The crisis we are seeing today is in part because new money has been created much faster than goods and services have, and much faster than has been historically sustainable. There are only two ways out of such a situation: inflation and bankruptcies. Each involve the destruction of money. The current convulsions of the financial and political elites basically come down to a futile attempt to prevent both. Their first concern is to prevent the evaporation of money through massive bankruptcies, because it is, after all, their money.

There is a much deeper crisis at work as well, a crisis in the creation of goods and services that underlies money to begin with, and it is this crisis that gave birth to the real estate bubble everyone blames for the current situation...

We're All Madoff

A must-read post.


See, evil requires secrecy.

Theoretically, banks are supposed to hold reserves of about 8% against their deposits, and therefore are limited to roughly 12:1 leverage against their asset base. Investment banks had a similar limit explicitly codified in the law, because as non-depository institutions they had no deposits against which to measure these ratios. In fact, up until 1998, all such "demand accounts" - that is, those in which you could walk into the bank and demand your money immediately (e.g. checking accounts and similar) were subject to these reserve requirements. This put an effective cap on leverage and thus risk - and the otherwise-unbridled growth of commercial and bank credit.

But starting in 1998 this changed. This Treasury Department OTS memorandum outlines a number of bills that were put forward by Senators and Representatives that, in many cases, still sit in our Congress. Senators Shelby, Hagel and Reid are explicitly named, along with the infamous Representative Leach of Gramm-Leach-Bliley. That memorandum also effectively eviscerated the reserve requirements that formerly kept our banking and thrift system safe and sound.

Between this change in policy, The Federal Reserve's intentional refusal to act to stop what amounted to infinite leverage, Treasury Secretary Paulson's (successful) entreaty to ease leverage limits on investment banks in 2004 (when he was running Goldman Sachs) and other similar actions taken by our government, we have in fact created the largest bubble ever blown in economic history throughout our banking and credit systems.

Now that bubble has popped.

In 2000, the damage done by the 1998 and 1999 decisions (which just happened to coincide with the final "blow off" top in the Nasdaq!) put our GDP approximately 10% "out of balance" with our actual productive capacity.

That is, the debt taken on during that bubble in excess of GDP growth represented about a 10% "premium" to a sustainable GDP level. Were we to simply wave a wand and make that debt (credit) disappear, GDP would have been 10% below where it was in 2000.

2000 GDP was approximately $10 trillion, so we would have suffered a $1 trillion contraction in GDP to bring the system back into balance, along with whatever business and banking failures which would have come along with that adjustment. Those failures would have resulted in an "overshoot" of some amount - perhaps another $500 billion.

Note that a total "peak to trough" contraction of 10% is generally thought of as a Depression. Not a "Great Depression", but an "ordinary" Depression.

Therefore, the economy in 2000 faced an economic Depression. To put this in perspective, in the post-war era the worst Recession on record was the 1973-75 event which recorded a 4.9% contraction in real GDP.

George Bush, our Congress and Alan Greenspan, however, refused to accept their responsibility in 2000 and 2001 for the economic policies of this nation and its banking regulators that led to the final blow-off top in the Internet Bubble.

In fact, Gramm-Leach-Bliley along with the sweep account changes were responsible for about half of the excess leverage of the Internet Bubble, and thus about half of the economic correction made necessary by its final blow-off top.

That's right - had those changes not been made we would have faced a 1973-74 style recession, but with those changes we were guaranteed a depression as the economic "just desserts" of the Internet Bubble era.

Being that this was deemed "unacceptable" Alan Greenspan along with Congress and the other regulatory bodies in Washington DC responsible for banking (and general credit system) safety and soundness undertook an intentional course of action to "paper over" the losses.

But wait! How can you do that?

You can't - except through fraud.

That is, you cannot prevent a loss from appearing and being recognized unless you allow people to lie about the value of securities, place them off-balance-sheet in opaque containers where nobody can see what's inside (and thus how they're performing) and "lever up" to issue yet more debt (credit) to cover the cash flow that should be happening but isn't.

As the embedded (and fraudulently-concealed) debt continued to mount banks and other institutions found themselves performing a Madoff - that is, issuing new credit (debt) to be able to "show earnings" that in fact were a phantom. Unlike Madoff they did not have to go find someone new to put money in to be able to issue the checks to existing investors, since a bank that can operate with no reserve requirements imposed on it is capable of issuing as much credit as it wants, effectively "printing money."

Regulations and leverage limits are supposed to prevent this, but they were systematically and intentionally dismantled in the name of "financial innovation."

In truth they were dismantled in the name of a massive financial fraud that permeated every corner of our credit system, from credit cards to student loans to automobiles to housing.

This ponzi scheme even extended to individual consumers - that is, you.

If you HELOC'd out money and paid down your credit cards with it, then charged anew or cash-out refinanced, you were a Madoff. If you bought a house with an Option ARM, knowing full well you could not make make a fully-amortized "recast" payment, you were a Madoff. If you played the balance transfer game with your credit cards, rolling balances from one zero-interest offer to another, you were a Madoff. Tens of millions of Americans did one or more of these things - and each and every one of them - if not you then someone you knew - was running a personal version of Madoff's scheme...

Sunday, December 21, 2008

“How Much Do You Have To Hate Somebody To Believe That Everlasting Life Is Possible, And Not Tell Them That?”

Quote is from well know entertainer and atheist skeptic Penn Jillette. The Anchoress has a good post plus the video reflection by Jillette.

Gulity Until Proven Innocent (And Even Then...)

Another way in which our culture has slid.


Visitors to London sometimes complain that Londoners are unfriendly, or at best reserved. To them I have an answer: get a dog. Borrow one for the duration of your stay. Last autumn, I walked George, a two-month-old cocker spaniel, for a friend while she was away. I had help from my good friend John; in fact we took it in turns. It rained every other day, so, like the little old man and woman of the mantelpiece barometer, I walked the dog on sunny days and John did duty on rainy days. This did not go unnoticed.

London is a different world when you have a dog, especially a puppy. Instead of scuttling or shuffling past, avoiding eye contact, Londoners young and old stop to talk to you and make a fuss of your little friend. Surly teenagers in hoods, studs in sunglasses melted at the sight of George, petting him and picking him up — and sounding distinctly uncool.

One of George’s admirers was a girl of about seven. A plain, awkward child, she played by herself in the park. On seeing the puppy, her face lit up and the plainness vanished. Every day — or rather every other day — she rushed up to me, falling over herself to hold him and cuddle him. Naturally we fell into conversation. An intelligent child, perhaps rather lonely, she was curious to know all about the dog, its owner — and my strangely silent friend John, who appeared on rainy days. “Why doesn’t your friend talk to me?” she asked, hurt. I was surprised at the question and, thinking that John was being churlish or impatient, resolved to tackle him about it that evening. “What, are you crazy?” he asked. “I can’t go talking to little girls in parks. I’ll get arrested.”

I remonstrated with him, but had to acknowledge that he had a point. George’s canine charms had failed to break down one of Britain’s great barriers: the barrier between adults and children. It is acceptable — just — for a woman to talk to someone else’s child in a public place, but a man who does the same thing must be a pervert. Has it come to this? How many perverts are there, for goodness sake?


Lots of good comments, also.

"I Can Only Say: 'Yes We Can!'"

Fred Thompson hits it out of the park. Video here.

Thursday, December 18, 2008

Morally Insane

"People need not worry about power corrupting US president-elect Barack Obama, an American research has suggested..."

And that's because the Messiah is like us in all ways except sin, right?


Enact socialism or the puppies get it.


Ripped off from here.

All In A Tizzy

Lots of histrionics as Obama chooses a Christian to give his inaugural invocation. Buggery enthusiasts don't like this one bit. GayPatriot has details.

A quote from the Right Wing News piece he links:

"Throughout the campaign, there were a few times when I was irritated with the Obama campaign, but I have never been so angry with Obama and his staff. By choosing homophobe Rick Warren, who helped pass Prop 8 in California, to do the invocation at the inauguration, Barack Obama just said to LGBT Americans that we're not part of that event. Thanks."

So let me get this straight. Rick Warren is a homophobe, i.e. suffering from a wicked psychosexual disorder, and therefore should be excluded from the proceedings, in order to send the message that it is wrong to exclude people who many believe suffer from a wicked psychosexual disorder.

All righty then.

GLBT activists are someday going to need to learn: just because others do something normal and commonsensical without considering the impact this could have on the feelings of a tiny sliver of a minority, it doesn't mean it's a direct insult to you.

And nobody's excluding you, anyway. Does the whole thing have to be all about you in order for you not to feel excluded? Should I feel insulted and excluded because Obama didn't pick a Catholic? I don't think so.

Wednesday, December 17, 2008

Wacky Pro-ID Video

Pretty close to the truth.

Weird, Wild Stuff

Some great animation:

H/T Mark Shea.

Yet Another Bubble

Would you lend money for 30 years to the US government for 2.7%?

The bond market is another massive accident waiting to happen.


This guy can be an entertaining, if emotional, financial read. If you're into contemplating worst-case scenarios, have a look.

It begins:

Yesterday we closed at a historic low, and early indications today are even worse, at 21.20 The IRX, or yield on the 13 week T-Bill, is essentially zero.

One cannot argue one simple fact - Bernanke hasn't yet started buying the long end of the curve to any material degree. But he's been threatening, and today the FOMC statement made explicit what had been whispered before.

The mouth-breathers were all over CNBC and elsewhere yesterday and today claiming that this would "stabilize" the credit markets and make credit (and the economy) better, with the most outrageous displays of stupidity being put forth by Cramer and McCulley of PIM(p)CO.

Yeah, right.

Now let's take a more cynical, but realistic, view.

Remember last year. Oil went from $60 to $150 in the space of a few months. Why? Because it was no longer profitable to buy CDOs and RMBS, as they were imploding. The money has to go somewhere, and so traders bet in front of what they believed Bernanke would do - crank down interest rates at an insanely-accelerated rate, which would spike prices in commodities, as the economic slowdown had not yet occurred - and wouldn't for several months.

They were right. Bernanke did it, oil shot the moon and Goldman (and a few others) made a whole bunch of money.

Who paid?

You did, by paying $4/gallon for gasoline.

Now let's back up a bit. 2003, to be exact. What happened? Greenspan (and Bernanke) played the same sort of game and house prices went ballistic. A handful of people made fortunes securitizing various mortgage and other "assets" into complex (and opaque!) securities, foisting them off on the world.

Who paid?

You did, by overpaying by 20%, 50%, 100% or more for a house.

Ok, so the housing bubble collapsed, then the commodity bubble collapsed.

Now we've got people who for the last month who are once again front-running Bernanke's playbook, which he was convenient enough to publish in advance as his doctoral thesis. They are buying the long end of the Treasury curve not because they think that a 2.35% yield for ten years is a reasonable rate of return over inflation, but rather because they expect The Fed and Government to drive prices higher than when they bought the securities.

That is, they're after capital gains, not yield or "coupon", and are specifically gaming the government and Fed.

Who's going to get the bill this time?

You are!

How? Simple. Treasury seems to think they can issue essentially limitless debt to bail out banks and others, having committed nearly $7 trillion thus far. Most of that has been issued through various short-term paper which has a near-zero (or actually zero!) interest rate - that is, up until now that debt issue has been essentially free!

What happens when this bubble bursts?

You think it won't? Like hell it won't. And when it does - that is, when Mr. Market calls the bet and forces Bernanke to actually make good by starting to unload all these "accumulated" Treasuries into his gaping maw, we will see "shock and awe" of another sort.

See, if the selling starts rates go up. To stop that Ben has to take up the supply. This causes him to print more money (expand his balance sheet) which means that the full faith and credit he relies on is further damaged. That in turn causes more people to get the idea that they better sell now which in turn causes him to buy more which.....

Remember the waterfall in September and October in stocks?

The same thing can happen in the Treasury market, and if it does it will force a political decision to be taken - risk the destruction of the dollar and our government or remove - by immediate statutory change (and force if that is resisted) The Fed's authority.

Tuesday, December 16, 2008

So, Wouldn't It Be Even Less Murderous And Exploitative To Reduce Them Down To Their Pure Elements?

If it's okay to turn an embryo into sperm and egg, it should be even better to reduce it to soot, air, and water, yes? I mean if all you're doing is just kind of turning back the developmental clock, and hey, there's nothing uncool about that.

"I’ve searched myself on that..."


The Onion: "$700 Billion Bailout Celebrated With Lavish $800 Billion Executive Party".

Monday, December 15, 2008

"I" Had To "Write" This Blog Post

Uncommon Descent:

In a previous post JT believes he has crushed the entire ID project by pointing out that: “A process determined entire[ly] by law can have EXTREMELY complex behavior and extremely difficult to predict behavior.”

No one disputes JT’s point, but it is beside the point as far as ID is concerned. JT is making a common error – he is confusing “unpredictable” with “contingent.” They are very different things.

When a bomb explodes the pieces of the bombshell are scattered willy nilly, and it is impossible to predict where any piece will land. Nevertheless, where each and every piece lands is utterly determined by law. In other words, where each piece lands is a function of nothing but the various physical forces acting upon it, which could, in principle, be modeled by a mathematical formula. This is an example of the complex unpredictable behavior resulting from law to which JT alludes.

Contrast the complex unpredictable – but nevertheless determined – behavior of the bombshell with the contingent behavior of an intelligent agent. This sentence that I am writing is an example of contingent behavior. My choice of typing out a certain combination of letters and spaces and not another cannot be accounted for on the basis of any known law. The only way to account for the sentence is as the contingent act of an intelligent agent. I had a choice, and I wrote that sentence instead of another.

Now JT might counter that I only believe I had a choice in writing that sentence, that my consciousness is an illusion, and that my actions were governed by law as surely as the flight of the pieces of bombshell. Well that’s the question isn’t it. JT – and other materialists – do not know that my consciousness (and theirs) is an illusion. They merely assert it, and until they can provide evidence (and by “evidence” I do not mean the recitation of their metaphysical tropes), that the seemingly self evident fact that I am conscious is not after all a fact, I will go on believing it. What is more (and this is very amusing) so will they. In other words, materialists struggle to prove that which they do not really believe. Every one of them knows he is a conscious agent, and why they attempt to prove that which they know for a certain fact not to be the case is a mystery.

Later JT wrote: “And for the record, I generally put ‘mind’ in quotes when referring to the ID concept of it and don’t use the term much at all, because of the potential for confusion.”

One wonders what JT meant by “I,” in that sentence, because if, as he says, the mind does not exist, the concept of “I” has no meaning, so it seems to me that it would make more sense for him to put irony quotes around “I” and not “mind.” This, of course, is just another example of how the materialist is forced to affirm the non-materialist case in the very act of attempting to refute it.

No, You Can't Has Cheezburger

Ripped off from here.

Friday, December 12, 2008

The Star

Very poetic Advent reflection by Vanderleun.

Xmas Present

Over Thanksgiving, my 7 year old nephew was playing with a slinky, some Christmas ornaments, and also a little Lego Spiderman vehicle, with a 1 inch tall Spiderman action figure. I'd brought my tripod and some macro filters and made a few shots of these items, while my nephew helped. Then I did some photoshop work, and now my nephew will be getting a couple of 8 by 12 posters of Spiderman:

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Eunuchs Generally Give The Best Advice

Colin Powell: always watching out for the GOP's best interests.



Newsweek Loves Biblical Religion. As Long As It Gets To Be Pope.

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Great news, people! The last 30 centuries were all just a silly misunderstanding. It turns out that buggery really is a sacrament!

Rebuttals here, here, here, and here.

Thursday, December 11, 2008

Econ School

Great post at Mish's Global Economic Analysis. Scary charts of the base money supply going vertical. Knee jerk thinkers anticipate hyperinflation, but the last time this happened was the Great Depression and WWII. The 70's stagflation is just a blip by comparison to those two events and today. Prognosis? Deflation.

Wednesday, December 10, 2008

Good Response

From philosopher Edward Feser to those secular conservatives who think the GOP needs to ditch religion (because, as "everyone knows", it's irrational).

Live By The Sword, Die By The Sword

Crash and burn.

Coming Down The Pike

How will business and life change during the Depression? Charles Hugh Smith has some good reflections.

BTW, it is easy for me to imagine Obama's New Deal failing pretty miserably, as his infrastructure projects will probably be make-work and symbolic, and will not help things at all since resources and labor will be wasted on them. The economy will continue to get worse and people are going to become deeply resentful of a new class of entrenched special interests: namely those (relatively few in number and also politically connected in one way or another) with the new make-work jobs.

The MSM: Always Worried About The Wrong Kind Of Flame Broiling

An asinine story about a completely innocuous (and fun) ad campaign. Oh the humanity.

Sunday, December 07, 2008

They Have Eyes But Do Not See, They Have Ears But Do Not Hear

So how do we reach them?

Excellent post at Uncommon Descent.

It's Easy. All We Need Is An Immediate Crash Project To Build A Rainbow To The Moon.

Not so simple:

Obama's plan to make it a focus of Federal stimulus/job creation spending sounds, at first blush, like a good idea. The money will be spent in areas that will improve productivity.

But will this massive rebuilding be effective as stimulus? Keynes stressed the the importance of a quick action to combat a big fall in demand. As much as Obama says he will move the program along quickly, I cannot see how large-scale hiring could take place in anything less than a year from now. Moreover, many of the newly or soon to be unemployed will not be suitable for this sort of work.

Let's look at the New York Times' recap:

President-elect Barack Obama promised Saturday to create the largest public works construction program since the inception of the interstate highway system a half century ago...Mr. Obama’s remarks showcased his ambition to expand the definition of traditional work programs for the middle class, like infrastructure projects to repair roads and bridges, to include new-era jobs in technology and so-called green jobs that reduce energy use and global warming emissions....

Mr. Obama’s plan, if enacted, would be in part a government-directed industrial policy, with lawmakers and administration officials picking winners and losers among private projects and raining large amounts of taxpayer money on them.... he said he would invest record amounts of money in the vast infrastructure program, which also includes work on schools, sewer systems, mass transit, electrical grids, dams and other public utilities. The green jobs would include various categories, including jobs dedicated to creating alternative fuels, windmills and solar panels; building energy efficient appliances, or installing fuel-efficient heating or cooling systems....

“We will create millions of jobs by making the single largest new investment in our national infrastructure since the creation of the federal highway system in the 1950s,” Mr. Obama said. He did not estimate how much he would devote to that purpose, but when he met with the nation’s governors last week, they said the states had $136 billion worth of road, bridge, water and other projects ready to go as soon as money became available. They estimated that each billion dollars spent would create up to 40,000 jobs.

What exactly does "ready to go" mean? Have they defined the project specification and requirements, and the criteria for selecting successful bidders? Have they chosen the architectural/engineering and construction firms (presumably, in the bidding process, they would have reached agreement on major project phases, deliverables, and costs)? Has the architectural/engineering firm yet developed detailed drawings?

Now that is probably not even remotely a complete list of what has to happen to bring a large civil engineering program into being, but hopefully you get the drift of the gist. You can't say, "Gee, let's upgrade our train terminal" and go out and hire a bunch of construction workers. A good deal of planning and vendor screening takes place before the labor-intensive phases move into high gear. And I have a sneaking suspicion that few of these 'ready to go" state programs have gotten as far as detailed planning and designing (I have trouble imagining a state would sign up and spend meaningful money on consultants and designers and then halt the project. And if they aren't that far along, they are a good way from hiring lots of bodies (although gearing up the planning/management apparatus does make an economic contribution).

Now go back and read the sorts of activity that Obama is calling for. Think any of those might be good next steps, say, for a middle aged bank employee? Someone who worked in a retail store?

By deploying dollars through existing companies, Obama will create a lot of construction jobs, and will greatly improve employment for engineers and skilled professionals already in the areas targeted (civil engineering, green technologies).

However, in our modern society, labor is far less fungible in the 1930s. The stigma of being unemployed was so great, and social safety nets were sufficiently weak that able bodied men would take whatever work was offered, even it if was a large step down from what they did before the bust. Today, no one would ask a former white collar worker to dig ditches. In the dot-com bust, for instance, the down and out in Silicon Valley sought work at Home Depot. And office workers now appear at risk of suffering the same fate as blue-collar workers who lost good manufacturing jobs: even if they find replacement work, it is likely to be with less pay and bennies than they had before.

So will Obama's plan be trickle-up for all those downsized corporate employees? Is the hope that enough infrastructure spending will in the end provide enough of an economic boost so as to restore some of the service jobs that have been lost? That isn't how the plan was stated, but I don't see a strong link between types of jobs lost and the ones to be created.

Oh, Come On


More info

Friday, December 05, 2008

The Google Zone

Fun amateur film making (unless it is some kind of stealth viral thing) based on a fairly obvious concept. Pretty good natural acting.

Thursday, December 04, 2008

Unclear On The Concept

Most of the commenters to the Volokh post I mentioned here simply do not really "get" the first amendment. I was finally led to comment:

I'm sure glad I've got a bunch of folks like you sticking up for the First Amendment. I'm detecting an awful lot of projection here. Just because most of you, quite evidently, are incapable of separating the way you would treat someone from your opinion regarding whether they (in this case Dixon) are morally right or wrong in their personal philosophy, doesn't mean Dixon is (but we all know Christians are inherently evil and not to be trusted, yes?). Is there anything in her actual 25 year record of *performance* that justifies firing, or is it only her thought crime? You see someone who disagrees with your moral opinion and cheerlead when she is railroaded for it. You enthusiastically participate in the very thing you wrongly accuse her of.

In this case, the sole person who has been unfairly treated for holding a moral view at variance with others is Dixon herself. But being a Grand Inquisitor is pretty fun isn't it? Especially when you know *damned well* that you can most probably get away with it if the victim is a Christian. Is there anything braver than a bunch of Constitutional lawyers?

Wednesday, December 03, 2008

Speak The God-Given Truth With Gentleness And Love, And Be Fired By The State

Interesting case at Volokh.com.

Of course, the state would never find that a Christian hating Marxist atheist could not be expected to do his job with proper sensitivity to others...

Tuesday, December 02, 2008

Some Mark Shea Humor


Did C.S. Lewis Go to Heaven?

Like this guy knows. Garrison Keillor once remarked that the Puritans came to the New World seeking the freedom to be harsher on themselves than English law allowed.

I think of that as I read these exercises in that minor Protestant sport called "Figuring out Who Made it to Heaven". It seems to invariably consist of faintly recalling that Jesus said somewhere, "Come into the kingdom which my Father has prepared for you from the foundation of the world. For I taught a theory of sola fide and you correctly articulated it. I hinted at double eternal predestination, limited atonement and irresistible grace and you cleverly figured it out. I was a dispensationalist and you agreed with me. I was a post-Trib rapture enthusiast and you correctly decoded me."

Here, Lewis apparently is suspect of being far too Romish in his opinions for the good Lord to tolerate.

Monday, December 01, 2008

Against Sophistry

From the comments here:

Ribczynski’s reply to Barry Arrington (#2 above), which was meant as a refutation of the possibility of design inference in biological cases, actually harms neo-Darwinism at least as much, if not more, than it harms intelligent design theory.

Ribczynski wrote:

“To answer question #2, you need to know how likely it is that a particular structure could have evolved via NDE or any other unintelligent natural process. As in the fine-tuning case, we just don’t have accurate estimates for these probabilities, so there is no basis for design detection.”

This pretty well gives away the store, as far as neo-Darwinism is concerned. Neo-Darwinism asserts a huge claim, i.e., that unguided processes can produce complex, integrated biological systems. Since the processes are unguided, they ultimately (even when all due weight is given to natural selection) depend upon chance. This means that, for neo-Darwinism to be plausible, probabilities that are not ludicrously low must be assigned to the chance events which are alleged to have generated complex integrated systems.

It is not enough for neo-Darwinism to say that somehow, in some way, chance events produced useful mutations, and accumulated them in the genome in just the right sequence to create complex integrated systems which had never existed before. That’s not science; that’s storytelling. If neo-Darwinism is going to claim that it is a scientific hypothesis, it has to be able to put numbers to its hypothesis. (And this is not just for the general reason that science must be quantitative. There are also very real time constraints regarding the fossil record. It is not good enough for chance to be able to turn a primitive primate into a man in a billion years. It has to be able to do so in 10 or 20 million years, because that’s all the time the fossil record allows.)

So if neo-Darwinism cannot provide even rough probability estimates, it is not science; and if it can provide rough probability estimates, then the design alternative cannot be discounted. Mr. Ribczynski is caught on the horns of a dilemma. Which alternative will he choose: to say that the design inference in biology is as scientific as the inference of unguided causes made by neo-Darwinism, or to say that neo-Darwinism, unable to adequately quantify itself, is no more scientific than design theory?


Is it possible that life was designed? If no, support your answer. If yes, then evolution based on chance & necessity alone is on the same footing as the explanatory filter. If they are both on the same footing of possibly producing false positives why should we prefer one over the other when the only demonstrated way for complex machinery to come into existence is through design? Even if design might not be true it seems that until some other mechanism is shown to be capable of the task that we should prefer the known mechanism.


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Refusing To Budge

Attractive Girls Union Refuses To Enter Into Talks With Mike Greenman

Then Something Like Scales Fell From Their Eyes

Stuck on stupid:

NPR Essayist: Mumbai Killers Might Just Be (Wait for It)... Evil

Gee, it's funny. Now that the presidency is not in enemy hands (for liberals), the enemies of the president are starting to look less misunderstood and more evil.

I get increasingly uncomfortable with the convention of journalism that requires us to say that so far, we don't know the motives of the people who carried out this week's attacks in Mumbai.

A word like "motive" seems to imply there was reason or purpose. It suggests that, however profane their actions, the terrorists had the incentive of some goal in mind.

But after covering too many killings, as a reporter or host, in Bosnia, Kosovo, Oklahoma City or Somalia, I've come to the conclusion that the perpetrators of such crimes might just be ... evil.

Evil is a word that many people of my generation shrink from using. It seems so imprecise and uneducated — biblical, rather than cerebral and informed.

But there are times and crimes that remind me how often the Bible gets it right.

Curious that he failed to mention the 9/11 killers, or terrorists in Iraq.

Good Lord. This is becoming infuriating. This guy's present stance is obviously right. Fine. Why is it he just coincidentally happened to refrain from taking this position for eight years?

On the other hand, there's Deepak Chopra...


Seen in ad here:


Always one revolution away from happiness.