Thursday, November 29, 2012

A Message for Monetary and Fiscal Policy-Makers

Main Street USA remains mired in economic depression as evidenced by: a) the long-term decline in real working wages; b) the long-term decline in real home values; and c) the long-term decline in the employment to population ratio. These indicators need to become the urgent focus of both monetary and fiscal policy in the US, or Federalism will risk decay or decline in detail. I urge everyone who knows someone who works in monetary or fiscal policy formation to forward this message to them in an effort to avert the end of Federalism as we know her. The US is running out of time...

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Wednesday, November 28, 2012

Conjuring Money

The notion of money (fiat currency) is the most insidious conceptualization ever conjured by humans.

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Well Said...

"Everybody is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing that it is stupid."

~ Albert Einstein

Dr Albert Einstein (1879-1955)

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Tuesday, November 27, 2012

Well Said...

"If you're not [represented] at the table, you're on the menu."

~ Unknown

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Well Said...

"Destiny is no matter of chance. It is a matter of choice: It is not a thing to be waited for, it is a thing to be achieved."

~ William Jennings Bryan

Hon William Jennings Bryan (1860-1925)

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Sunday, November 25, 2012

US Defense Spending Devours America

According to the CATO Institute (2012), US real defense spending has roughly doubled since 2000.

Note that the US defense spending graphed in the chart above is in constant 2011 (inflation adjusted) dollars. No wonder the US is broke...

Source: Boaz, D (2012, January 11), Misleading Images on Defense Spending, CATO@Liberty.

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Fabric of the Cosmos: Quantum Leap

Follow the link below for more episodes from the series, Fabric of the Cosmos.

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Fabric of the Cosmos: Illusion of Time

Follow the link below for more episodes from the series, Fabric of the Cosmos.

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Fabric of the Cosmos: What is Space?

Follow the link below for more episodes from the series, Fabric of the Cosmos.

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Well Said...

"One lucky shot deserves another."

~ Shaquille O'Neal

Dr Shaquille Rashaun O'Neal (1972- )

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Saturday, November 24, 2012

Lifeline for Main Street USA

Main Street USA continues to endure the effects of economic austerity caused by a scarcity of money (as evidenced by declining real wages, declining real home values, and a declining employment to population ratio). However, both fiscal and monetary policy makers are finally taking notice as the Fed pursues QE3 in an effort to reverse Main Street's real estate catastrophe, and the GOP seeks to retrench as a result of their disconcerting election losses.

Allen Street in State College, PA

Although late, the battle to win back Main Street political support is now in full swing as both big government Democrats and military-industrial Republicans create new strategies to address the Main Street depression still raging across the US. I expect the US will go over the fiscal cliff with tacit support from both Democrats and Republicans. The fiscal cliff losers will be the military-industrial complex, medical establishment, and government workers, who will now be required to make sacrifices for the first time since the economic crisis began in 2008.

Wise investors will seek to get involved in real estate development in order to exploit new capital being introduced by the Fed via purchases of mortgage-backed securities. I expect originations of new mortgage-backed securities to accelerate over the coming year, and to continue for at least the next 2-3 years. Main Street USA is finally being thrown a lifeline...

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Well Said...

"The loneliest people are the kindest. The saddest people smile the brightest. The most damaged people are the wisest. All because they do not wish to see anyone else suffer the way they do."

~ Anonymous

The Sad, Wise Eye by Alessandro Cristallo at DeviantArt

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Friday, November 23, 2012

The Code: Prediction

Follow the link below for more videos included in the BBC series, The Code.

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The Code: Shapes

Follow the link below for more videos included in the BBC series, The Code.

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The Code: Numbers

Follow the link below for more videos included in the BBC series, The Code.

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Well Said...

"You can discover more about a person in an hour of play than in a year of conversation."

~ Plato

Birth of Venus by Sandro Botticelli (1445-1510)

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Thursday, November 22, 2012

Happy Thanksgiving 2012

Best regards to everyone I care about this Thanksgiving Day...

Fall foliage from my home in the Allegheny Mountains of Pennsylvania

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Wednesday, November 21, 2012

Lladró Scientia

The Lladró Scientia, a demure monument that inters esotericism while pondering the light...

The Lladró Scientia (collection of Dr William J McKibbin)

My path...

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Monday, November 19, 2012

Friday, November 16, 2012

America's Fiscal and Monetary Policy Options

Let's consider America's fiscal and monetary policy options at this point:
  • Austerity in the form of government spending cuts [ruled out by most Democrats]
  • Austerity in the form of tax increases [ruled out by most Republicans]
  • Default in the form of debt renunciation [ruled out as unconstitutional]
  • Default in the form of monetary expansion leading to inflation
Looks like the US is running out of policy options...

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Well Said...

"America's present need is not heroics, but healing; not nostrums, but normalcy; not revolution, but restoration; not agitation, but adjustment; not surgery, but serenity; not the dramatic, but the dispassionate; not experiment, but equipoise; not submergence in internationality, but sustainment in triumphant nationality...."

~ Warren G Harding

Hon Warren Gamaliel Harding (1865-1923)

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Thursday, November 15, 2012

Well Said...

"Effort only fully releases its reward after a person refuses to quit."

~ Napoleon Hill

Dr Napoleon Hill (1883-1970)

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Wednesday, November 14, 2012

What is an Autodidact?

A self-taught person.

Leonardo di ser Piero da Vinci (1452-1519)

Source: The Free Dictionary

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Well Said...

"Time is the father of truth, its mother is our mind."

~ Giordano Bruno

Dr Giordano Bruno (1548-1600)

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Tuesday, November 13, 2012

Well Said...

"I am not bound to win but I am bound to be true. I am not bound to succeed but I am bound to live up to what light I have."

~ Abraham Lincoln

The "Young" Abraham Lincoln (1809-1865) by Charles Keck (1875-1951)

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Monday, November 12, 2012

Sunday, November 11, 2012

The Great California Exodus: A Closer Look

According to the Manhattan Institute for Policy Research (2012, September), population growth in California may soon lag that of the US as a whole.
California was once a powerful draw for Americans on the move—a golden land, “west of the west,” in Theodore Roosevelt’s famous phrase, where everything could be better. But that California is no more. Around 1990, after decades of spectacular postwar growth, California began sending more people to other states than it got in return. Since that shift, its population has continued to grow (at a rate near the national average) only because of foreign immigration and a relatively high birthrate. Immigration from other nations, though, is declining, and it is likely that the state’s growth rate may soon fall behind that of the US as a whole. As a magnet of opportunity, the state now pushes out where it once pulled in.
Read More

Follow the link below to learn more about the motivations behind those who are leaving California.

Source: Gray, T & Scardamalia, R (2012, September), The Great California Exodus: A Closer Look, Manhattan Institute for Policy Analysis.

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Well Said...

"The attitude that nature is chaotic and that the artist puts order into it is a very absurd point of view, I think. All that we can hope for is to put some order into ourselves."

~ Willem de Kooning

William de Kooning (1904-1997)

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“I read Nate Silver. I’m a fan of Nate Silver. State senator, you’re no Nate Silver.”

by Sherman Dorn © 2012

The takeaway from the Nate Silver-punditry smackdown this fall is not that any quantification and set of algorithms beat the pants off your nearest broadcast yodeler, but that quantification done well will beat the pants off your nearest broadcast yodeler, and that your nearest broadcast yodeler presents the equivalent of the Washington Generals in battles with professionally competent quantification.

For the best argument about this, go no further than Nate Silver’s new book, The Signal and the Noise, which is largely about modesty in quantification and the difficulty of constructing accurate prediction systems. If you want a panegyric to algorithms, you instead need Christopher Steiner’s Automate This. Steiner is entertaining and should be the publicist for Sal Kahn, the School of One, and so on, but Silver is more realistic.

In particular, Silver addresses uncertainty in an explicit and transparent manner, in both his analysis of polling and in his discussion of predictions more broadly. The largest gap between Silver’s approach and the public discussion of quantification in education is the almost complete failure of both reporters and policymakers to address uncertainties in an open manner.[1] If any advocate, policymaker, or pundit uses Nate Silver (as an object lesson) to argue in favor of current practices in test-based accountability or the use of point estimates in any proposed policy, they are demonstrating that they haven’t read his book. To wit, the title of this entry.

Wonkish regret/adjustment: Silver also makes a wonderful argument in favor of probabilistic reasoning, specifically a Bayesian approach to statistics, though I suspect he will be less successful in that argument. Frequentists won the professional debate 100 years ago, and the standard introduction to statistics is rooted firmly in frequentism (quick: do you use the term “confidence interval” or “credibility interval”?).[2] But in addition to the dominance of frequentist approaches in professional training, it is also very difficult to think about probability in the abstract and more specifically to reason through quantification in the frame of conditional probability (the main engine of the Bayes theorem). If you want to test your ability to reason abstractly about conditional probability, see how much you resist the basic solution to the Monty Hall problem. Trust me: humans are pretty awful about this, even with quite a bit of education.

Fortunately, you don’t always have to think abstractly about conditional probability to use it. At least in relatively simple cases, there are two ways to get around our brains’ general incompetence at probabilistic reasoning: using real numbers in hypotheticals (for basic questions of conditional probability) or using a moderately-sized set of simulations to understand the dynamics of a simple system (what I used in September to look at the Chingos/Peterson research on whether the privately-funded voucher program they studied had consequences for college attendance). But we tend to have this blind spot and need to know how to get around it in some way.

Where Silver is inconsistent: Silver is less transparent in his own practice about building models and using human judgment (his exact models are proprietary), but both appear in the book. I’d pay more attention to his book than his practice here, at least in terms of using quantification in practice. Silver correctly sees landmines everywhere for those wanting to predict the performance of ballplayers to earthquakes, and he argues that the remarkable success in weather forecasting has depended on both increasingly detailed information about the atmosphere and also the human judgment that forecasters use in making predictions about tomorrow’s weather and the next three days of the tropical storm track. For that to make sense for public policy, the models should be public.


1. Researchers also tend to believe that their research findings are more accurate and trustworthy than they are, something Silver discusses in his book. Yes, research psychologists have studied the extent to which research psychologists are numerate.

2. Silver’s academic/training background is an undergraduate degree in economics from the University of Chicago, and then four years of work at KMPG.

Source: Dorn, S (2012, November 7), “I read Nate Silver. I’m a fan of Nate Silver. State senator, you’re no Nate Silver.” Sherman Dorn.

Republished with kind permission of Sherman Dorn © 2012

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Well Said...

"Not to engage in the pursuit of ideas is to live like ants instead of like men."

~ Mortimer J Adler

Dr Mortimer Jerome Adler (1902-2001)

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Saturday, November 10, 2012

Map of Truth and Deception

A map of truth and deception captured inforgraphically...

[click image to enlarge]


Meyer, P (2012, November 9), TedWeekends: Understanding Deception Idea Visualization, The Huffington Post.

Meyer, P (2012, November 9), How to Spot a Liar, The Huffington Post.

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Well Said...

"I have desired to do good, but I have not desired to make noise, because I have felt that noise did no good and that good made no noise."

~ Louis Claude de Saint-Martin

Louis Claude de Saint-Martin (1743-1803)

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Friday, November 09, 2012

What is Prejudice?

a. An adverse judgment or opinion formed beforehand or without knowledge or examination of the facts.
b. A preconceived preference or idea.
2. The act or state of holding unreasonable preconceived judgments or convictions.
3. Irrational suspicion or hatred of a particular group, race, or religion.
4. Detriment or injury caused to a person by the preconceived, unfavorable conviction of another or others.

Source: The Free Dictionary

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What is Bigotry?

Obtuse or narrow-minded intolerance, especially of other races or religions.

Source: The Free Dictionary

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Frequentists versus Bayesians

Republished with kind permission of XKCD

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Wednesday, November 07, 2012

Windows 8 Pro is Awesome

As soon as Windows 8 Pro (Microsoft) was released, I upgraded my personal computer. The upgrade experience took a bit longer than I expected (about 3 hours). However, the upgrade performed as advertised. A screen shot of my new desktop appears below.

I have been using Windows 8 Pro now for over a week, and I can report that the upgrade was well worth the minor upgrade cost ($39.95 via direct download). You will find many excellent reviews of Windows 8 Pro available on the Internet, so I will not repeat those efforts. I will only add that my upgrade experience went well and I am delighted with this newest release of Windows.

PS: I run Windows Phone 7.5 on my mobile device, which interfaces perfectly with Windows 8 Pro...

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Sunday, November 04, 2012

Romney's Guiding Principles Tough Sell

According to Prof Robert B Reich (2012, November 3):
Romneyism has an internal coherence. It is different from conservatism, because it does not intend to conserve or protect any particular institutions or values. It is also distinct from Republicanism, in that it is not rooted in traditional small-town American values, nationalism, or states’ rights.
Prof Reich goes on to detail the ten guiding principles of "Romneyism" as:
1. Corporations are the basic units of society. Corporations are people, and the overriding purpose of an economy is to maximize corporate profits. When profits are maximized, the economy grows fastest. This growth benefits everyone in the form greater output, better products and services, and higher share prices.

2. Workers are a means to the goal of maximizing corporate profits. If workers do not contribute to that goal, they should be fired. If they cannot then find other work that helps maximize profits in another company, their wages must be too high, and they must therefore accept steadily lower wages until they find a job.

3. All factors of production – capital, physical plant and equipment, workers – are fungible and should be treated the same. Any that fail to deliver high competitive returns should be replaced or discarded. This keeps an economy efficient. Fairness is and should be irrelevant.

4. Pollution, unsafe products, unsafe working conditions, financial fraud, and other negative side effects of the pursuit of profits are the price society pays for profit-driven growth. They should not be used as excuses to constrain the pursuit of profits through regulation.

5. Individual worth depends on net worth — how much money one has made, and the value of the assets that money has been invested in. Any person with enough intelligence and ambition can make a fortune. Failure to do so is sign of moral and intellectual inferiority.

6. People who fail in the economy should not be coddled. They should not receive food stamps, Medicaid, or any other form of social subsidy. Coddling leads to a weaker society and a weaker economy.

7. Taxes are inherently bad because they constrain profit-making. It is the right and responsibility of individuals and corporations to exploit every tax loophole they (and their tax attorneys) can find in order to pay the lowest taxes possible.

8. Politics is a game whose only purpose is to win. Any means used to win the game is legitimate even if it involves lying and cheating, as long as it gains more supporters than it loses.

9. Democracy is dangerous because it is forever vulnerable to the votes of a majority intent on capturing the wealth of the successful minority, on whom the economy depends. The rich must therefore do whatever is necessary to prevent the majority from exercising its will, including spending large sums of money on lobbyists and political campaigns. The most virtuous among the rich will go a step further and run for president.

10. The three most important aspects of life are family, religion, and money. Patriotism is a matter of guarding our economy from unfair traders and undocumented immigrants, rather than joining together for the common good. We owe nothing to one another as citizens of the same society.
Mr Romney's principles, regardless of coherence, are a tough sell for many Americans...

Source: Reich, Robert B (2012, November 3), Romneyism, Robert Reich.

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Well Said...

"The political economist is to the general public what the attorney is to the private individual."

~ Robert T Ely

Prof Richard Theodore Ely (1854–1943)

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Friday, November 02, 2012

US Employment to Population Ratio Improves

According to the Bureau of Labor Statistics (BLS), the US employment to population ratio* for October 2012 stood at 59.0%, up from 58.7% a year ago in 2011, 58.6% two years ago in 2010, and 58.8% the previous month of September. The US employment to population ratio has been trending downwards since 2000.

Many economists believe that reporting the number employed as a percentage of the civilian population provides a more accurate description of the current state of employment than conjecturing the number of "unemployed" in a population. The US employment to population ratio reached an historical peak of 64.4% on an annual basis in 2000.

*The BLS defines employment and population (civilian noninstitutional) as follows:
Employment consists of all persons who, during the reference week (the calendar week including the twelfth day of the month), (a) did any work at all (at least 1 hour) as paid employees, worked in their own business or profession or on their own farm, or worked 15 hours or more as unpaid workers in an enterprise operated by a member of the family, or (b) were not working but had jobs or businesses from which they were temporarily absent because of vacation, illness, bad weather, childcare problems, maternity or paternity leave, labor-management dispute, job training, or other family or personal reasons, whether or not they were paid for the time off or were seeking other jobs.... The civilian noninstitutional population consists of persons 16 years of age and older residing in the 50 States and the District of Columbia who are not inmates of institutions (for example, penal and mental facilities and homes for the aged) and who are not on active duty in the Armed Forces.
Source: Bureau of Labor Statistics

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