"So there are Oliphaunts. But no one at home will ever believe me."
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Sometimes you have to break a few eggs

To a certain way of thinking, it is intuitive that antisocial personality traits predict utilitarian responses to moral dilemmas. I am a little surprised at the apparent absence of self-knowledge and critical introspection among those reacting to the findings, with the researchers denying the validity of their own results and some of the commenters expressing outrage that such doubleplus ungood thoughts could be expressed (thankfully none of them proposed that these socially non-constructive researchers be forcibly re-educated, for the common good.)

(Via Instapundit.)

October 1, 2011   Comments Off

Signal to noise ratio

Some worthwhile thoughts on the European bail-out. Well done, violent protestors!

1. The fundamental cause of the financial crisis has been people and institutions thinking they are more wealthy than they are; this spread to Europe as well and now we are seeing the comeuppance.

3. The major European powers would not have come up with a nearly $1 trillion bailout, also involving de facto loss of ECB independence, unless they were scared ****less.

4. They are trying to do a version of TARP-in-advance-of-the-panic and in my view that panic would have come today.

9. This doesn't solve any of the basic fiscal problems, so ultimately it raises the stakes and creates a chance of even greater financial failure.  Simon Johnson comments.

Read the whole thing. Obviously I don’t have access to news about the finanical system other than what is publicly available, so I have to wonder how the basic market signals about debt and borrowers were misread by so many, for so long. It seems like the system is so full of noise (bad data) that assessing the true value of anything is impossible. Good luck to those who make their living placing bets.

(From “Simple thoughts on Europe“, via Marginal Revolution.)

May 11, 2010   Comments Off

Unraveling

This reminds me of a short story by Italo Calvino, in which an aged accountant awaits the utter collapse of the bank where he has worked his entire life, waiting the entire time for the error of pennies he had made as a young man to multiply and compound until its magnitude dwarfed the holdings of the bank.

A bad day in the financial markets was made worse by an apparent trading glitch, leaving traders and investors nervous and scratching their heads over how a mistake could send the Dow Jones Industrial Average into a 1,000-point tailspin.

I strongly suspect that the true state of the market is more like something out of a Borges short story.

Hard to put my pessimism into words without sounding ridiculously melodramatic.

(From “Dow Takes a Harrowing 1,010.14-Point Trip – WSJ.com“)

May 7, 2010   Comments Off