20 October 2017

Biggest Corruption

If you were a risk-averse member of the Billionaire's Boys Club, what would be your ultimate wet dream? Well??? By my lights, I'd say I would want Treasury instruments to be sold at interest rate value rather than auctioned at coupon value.

Translation: the way it currently works by 31 U.S.C. Subtitle III, Subchapters I & II, Treasury sets a return value, aka coupon, per some unit of instrument, say $100 per unit. Treasury then auctions those units. The resulting interest rate is the $100/X where X is the final auction price of the unit. If X is $1,000, then the interest rate is 10%. If X is $10,000, then it's 1%. For the last few years, X has been nudging much closer to 1% than 10%. That's driving the idle rich batshit.

Near as I can tell, nowhere in the statute is coupon/auction mandated as the method for selling instruments. Donald J. Quisling can/could direct Treasury to henceforth sell instruments with a fixed coupon (current practice) and fixed price (not auctioned to highest bidder), thus yielding the idle rich's 10% government debt. The fall out from this is clear. The secondary market for Treasuries would still be awash in moolah, and so would bid up the price of such instruments, thus giving the original buyers a massive capital gain windfall (which implies a change in tax law to remove holding periods for capital gains protection, naturally). The other, much worse side-effect is that US government debt just got lots more expensive. Yet another transfer of wealth from the many to the few.

Have a nice day.

19 October 2017

For So Long?

While watching the baseball games yesterday, I noted (for the first time, I suppose) that the home plate umpire wore glasses!!! The country has gone to hell in a handbasket. The only reason I could see this abomination was because the ump caught a foul off the mask, which he took off for a bit, on camera.

So, off to the innterTubes to find out how long this degradation of America's Game has been going on. I expected a few years, at most. Well, not so much.
On April 25, 1956, newspapers across trumpeted the news that Frank Umont had on the previous day become the first big league umpire to wear eyeglasses in a regularly scheduled game.

Damn! And to top it off, that's my sister's birthday, although not year. Instant karma.

Why the iPhone X?

The first decade of my life was spent in a 1,000 sq.ft. house-on-slab, built on an abandon wood lot. Thanks to that, the termites swarmed in the spring. Bad as it was, the parents managed to get foreclosed, so it was off to veteran's housing. This was 1960, and then at least one parent had to be a real veteran; during our years there the projects devolved into open welfare apartments.

The parents were a bit above average smarts, but below average ambition. Oh well. The point of the experience was this: by the time I was eleven or twelve I noticed that there were a lot of late model Buicks and Cadillacs in the parking area. Why, thought young Robert? Weren't there more useful and important things to own?

The answer from the point of view of those Caddy Daddies, as I eventually figured out, was: of course not. A fancy, even if old-ish, car was the most conspicuous object poor folk could still buy. Even if it meant lousy living space and lousy food and lousy clothes and lousy everything else. But that Caddy was parked outside the apartment.

The iPhone X is quite the same: a conspicuous object that doesn't do much more than far cheaper alternatives, but worth it as a measure of self esteem. Behavioral economists' fodder, for sure.

18 October 2017

New Gold, Part the Fourth

Yet another installment in the continuing saga of what it means for the US Buck to be New Gold. Today's contestant is Eduardo Porter, a many time returner. His jumping off point is the current account trade deficit. What he doesn't do is connect the dots from domestic bucks to international trade dependent on sufficient US Bucks in the system to support non-deflationary growth. That last bit is an oxymoron, naturally.

Here's where Porter finally gets closer to the point
But slashing the trade deficit for good will be very tough. That would require weakening the American dollar, the reserve currency of the world. That would be no easy task.

The dollar is the main currency used in global trade, as well as international capital market transactions. People and governments the world over store their wealth in American stocks and bonds. What's more, the dollar is the go-to currency in the time of financial crises, even if the crises at hand are centered in the United States. Against these forces it is hard to keep the dollar down.

From AnandTech we get the louder drumbeat of the Brave New World; run by Corps rather than the Damn Gummint, of course.
From the beginning, the NNP and its Nervana Engine predecessor have aimed at displacing GPUs in the machine learning and AI space, where applications can range from weather prediction and autonomous vehicles to targeted advertising on social media.
[my emphasis]

I wonder. Will they take payment in rubles?

17 October 2017

The Gull Flies True

Once again, the editors of the NYT have shown their sense of humor. Two articles which illustrate an issue, just not on the same page this time.

The easy one is this Kimmel piece. Kimmel, after all, is an obvious totem these days. And he knows it.
Of course, you want as many people to watch your show as possible. But some things are more important than bringing in a big audience. I hope that we, as a nation, get back to a time where I can have a normal, well-rounded show, that's more focused on Beyoncé and Jay-Z than Donald and Ivanka. But for the time being, this is what's at the forefront of people's minds.

Paired with this piece on the Trumpcare situation.
So for residents of the nearly all-white county, who overwhelmingly voted for President Trump, the fight over the Affordable Care Act is about both lives and livelihoods, access to care and to jobs. And the cloud that remains over the law's future is unsettling.

May be, just may be, these shitkickers will figure out that the Billionaire Boys Club founder cares not a whit about them. He gulled them right good.

12 October 2017

Where Quant Matters

There's only one field where quant really, really matters and it's not tech and it's not finance (666). It's biopharma. And the reason, naturally, is that, past the discovery process, it's all about the numbers. Do the numbers from the trials demonstrate that CompoundX is really better than some placebo or Standard of Care?? Bayesians, may you rot in hell if you get your hands on clinical trials.

If you follow biopharma more than casually, you know of Derek Lowe. Today's musing is mandatory.
How many of the bullish investors in that company [Axovant] realized (or really understood) that the same exact compound had failed a well-run Phase II trial in Alzheimer's, and that since then two other drugs with the exact same mechanism of action had done the same?

I've used the epithet more than once: "as any math stat will tell you, give me a large enough sample size and I'll get you stat sig for a ham sandwich curing cancer". Well, here's a snip from a comment to Lowe's piece
I went back to look at the REVEAL results, and no wonder they are not filing it. The CV event rates were 10.8% for anacetrapib and 11.8% for placebo. That is a microscopic effect size. True, the p-value was 0.004, but that is probably due to the "black hole" effect common to many outcome trials - small difference trend toward significance when the sample size becomes large. No payer would reimburse for this level of efficacy, p-value or not.
-- Emjeff

Read through the comments. As of when I type this, they're at least as acerbic as Lowe. Well, a whole lot more. Good on 'em.

Balance the Scale

Here's some of a comment on a Seeking Alpha piece on Apple's new iPhones
Perhaps you aren't familiar with a manufacturing concept called economies of scale. Apple produces hundreds of millions of iPhones a year, while most analysts believe Google built no more than 1 million units of the Pixel and Pixel XL in the past 12 months. Something tells me Apple spends a whole lot less on each iPhone than Google does on each Pixel phone.
-- Bradmeister

A rookie mistake, naturally. Non-quants generally view EoS as, at least, infinitely linear to 0 average cost. That's stupid, naturally. EoS is determined by sector/company specific factors. And there's no evidence that EoS follows a linear trend, rather that it reaches minimum at some asymptotic value. (oooooh!! that notion again!!)

To put it another way, there are four generalist parts of production: capital equipment, input materials/assemblies, power, and labor. EoS is a result of technological advances, not just higher production, it's not some magical side effect of simply making more widgets. Imagine a semi-conductor production cell. It takes in sand at one end and spits out finished chips at the other; that's fanciful, to some extent, but close enough. Now how are there EoS for such a closed world production method? There aren't, naturally. With such a fixed capital stock, there's no average cost advantage to make more chips than 24/7/365 use of such a cell. You have to buy/build another cell. If you can't run it 24/7/365, i.e. sell its full output, your average cost/chip overall goes up, not down. Since this cell demands little to no labor, there's nothing much to be gained through labor saving. Supply of input materials/assemblies may or may not in total decline based upon outside factors.

So, in sum, it's unlikely that Apple or Samsung has much production cost advantage, especially given that the vast majority of iPhone is built by others than Apple. To the extent that EoS exists, Apple benefits just as much as Samsung et al since they all buy from the same underlying vendors who build to satisfy all comers. A falling tide lowers all boats. The notion that Apple will in-house production is foolish; they'll slide down the EoS to higher cost. There's a reason Apple has never made much of what it sells.

11 October 2017

Ashes to Ashes

Ever since, at least, the "totally destroy" North Korea nonsense from Donald J. Quisling, I've had a bothersome homo economicus nag. We know that NK has thousands of artillery along the DMZ (remember, the Korean War is not over, only an armistice) aimed at Seoul and environs. SK manufacturing is scattered over the country, but the administrative centers of these companies are in Seoul. Cut off the head, kill the dragon.

So, kill a million or two South Koreans, and put an end to the American consumer economy. Such a deal. Lose, lose. America first; all those jobs will come back to the USofA. Dontcha think??

10 October 2017

Ace of Trumps

So, we have this report today, wherein Donald J. Quisling throws down the gauntlet. I expect you can find the same on your news source of choice, modulo InfoWars and kin.
Speaking to Forbes magazine, Mr. Trump was reacting to the report that Tillerson had previously called the president a "moron."

I think it's fake news, but if he did that, I guess we'll have to compare IQ tests. And I can tell you who is going to win.

Of course, yesterday I did some innterTubes surfing to attempt to confirm what Donald J. Quisling has said in the past, that he's a smart guy. Oddly, he's never provided verification of his grades anywhere. Can you believe that? One should see that in the graduation book.

09 October 2017

Robin Hood, Well May Be Not

The notion that giving mo moolah to the rich will, instantly, yield more jobs has been rejected by most analysts at least since Laffer/Reagan when the gambit was tried. It was tried again by W. Neither giveaway led to more jobs or growth. Nor would it, considering that The Rich have no interest in growth or jobs. Again, do the arithmetic: Treasuries keep getting bid up (interest down) just because the 1% are chicken hearts when it comes to investment. They've no gonads for that sort of thing.

But, one might assert, the argument is just academic jealously of The Rich. Well, may be. But today's reporting from a Job Creator supports this fundamental truth.
As an entrepreneur myself and a friend to many others, I know that lower tax rates will not motivate more people to start companies. People start companies for many reasons: a compelling idea, ambition for fame and fortune, a desire to be one's own boss, frustration with one's employer. I have never heard someone say, "I would have started a company, but tax rates were too high" or "I wouldn't have started this company, but then George W. Bush cut tax rates, so I did."

Finally, some good sense (you've read the same here a number of times)
I am an entrepreneur and a businessman, but I am also a citizen. I believe tax cuts that deepen our already severe inequality in income and wealth are not in the long-term interests of any citizens, not even the very wealthy. Extreme inequality is corroding our civil society, poisoning our politics, and undermining our effectiveness as a nation. This is an extremely hard problem to solve, but when you're in a deep ditch, the first thing to do is stop digging.

Thought for the day - 9 October 2017

Echoing Comey,
Lordy, I hope there are tapes.
Wouldn't it be a treat if Corker has recordings of his dealings with Donald J. Quisling? Proving, of course, that Donald J. Quisling really did ask him to run in 2018 and offering support.

07 October 2017

On Getting Old

simple-talk's Database Weekly (you should subscribe) has a link to this comment-less piece on the persistence of C. Which word structure always reminds me of Dali.

[the Wiki]

I only have a couple of points to add. C dates from 1969, so is 50 years old in decadal terms; although it was sequestered to Bell Labs, more or less, for some years. COBOL is an even older language, and going strong for the same reason: billions of lines of code which would be way too expensive to re-write in PHP. And the author offers this
C is often referred to as cross platform assembly.
The way I learned it, the epithet was a tad stronger: C is the universal assembler. And not at all, really. Years before Excel there was something called Lotus 1-2-3. The first few version ran in DOS assembler, with so-called character graphics. The machines of the day were 8088 cpu, typically < 512MB, no floating point co-processor (-87), and perhaps a 5MB hard drive. Mitch decided on MS macro assembler as the language to use, since he had only enough man-years for one effort. He decided on the IBM PC as the platform, and then he had to decide on the OS and language. Gates won. And it was a blinding success. It made the IBM PC the device to have in any serious business. But, for reasons I've never bothered to track down (but fairly easy to guess), around the 4th release it was re-written in C. This was DOS 3.0. Wherever I was working, we "upgraded" from the assembler version to the C version (I doubt the powers that be had any idea), but without upgrading the machines.

Boy howdy!! What had been instant screen updates turned into the cursor slow dancing across the screen. Assembler, indeed!! Which is why any serious compute work is still done in a real assembler.

04 October 2017

Why? I'll Tell You

During one of last night's MSNBC chat shows, one of the pundits (failing memory says Chris Matthews) said something like:
When they wrote the Second Amendment, they were talking about muskets!!

Which is true. Here's the text
A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.

In historical context, of course, a Militia in 1791 was the same as the National Guard today: a state entity, not insurgents in Montana or other shitkicker empty states. That's the main reason opponents of unfettered access to guns say the 2nd has no basis for civilian access to military grade weapons.


Look back at 1791, and you see that (esp. non-urban) American civilians and standing army soldiers used the same weapon: a musket. Yes, the army had cannon and ships and such, but the soldier and the civilian had the same weapon. While I don't follow the NRA at all, I expect that someplace they've made just that argument: the civilian deserves access to the same weapon as the soldier, or the army will subjugate the populace.

Spider's Web

The Supremes are reviewing the anti-gerrymandering case, and the thought crossed my mind that someone, particularly of the Democratic vein, should have done some research. Recall the thesis presented here, and subsequently repeated by some of the mainstream pundits (without crediting your humble servant, of course), that there aren't Red states and Blue states. There are Blue cities and Red shitkicker empty counties.

Given gerrymandering, Rightwing success in minority rule, and the actual distribution of Reds and Blues, one would expect that Red legislatures (which predominate in having re-districting power) would attack cities by pie-wedging their area so that it often/always ends up that districts have some Blue city folks outnumbered by Red shitkickers. Kind of like a spider's web. One might expect this would be easy to demonstrate with the funds, folks and time that major think tanks have. Dontcha think?

I did, and here's what I found.

Here's a Washington Post article, which references the latest Brennan Center report. Neither, that I could find explicitly calls out urban cracking.

And, here's something explicit
For example, a Republican-held district near Philadelphia that had been trending toward Democrats was stretched westward to take in more conservative voters. And Democratic-leaning voters in Scranton and Wilkes-Barre were shifted out of a Republican-held seat into a Democratic-led district to help protect the GOP incumbent.

Law Street, at least, makes the case that such a process exists, but doesn't show such a district map. Oh well:
An example of cracking is when poor, urban voters are spread across districts where a large majority of the voters are rural. This prevents the urban voters from carrying much weight during elections. This is the most common type of gerrymandering.

OK, so ThinkProgress has some of the Wisconsin map. Very pretty.
[W]here Democrats lived near large blocs of Republicans, Democratic communities were "cracked" up and placed in multiple districts that were overwhelmingly likely to elect a Republican.

AKA, cities chopped up and bundled into shitkicker empty spaces.


03 October 2017

Whites Only

One segment of the population, and vaguely multi-culti, has figured out that the Donald J. Quisling cabal is purely white racist. Over the last few weeks I've seen Ta-Nehisi Coates on various chat shows, due to the imminent release of his book, "We Were Eight Years in Power". For those who've not seen him, or don't read "The Atlantic" any longer (your humble servant included), the book is a chronological collection of (all of?) his essays over the Obama presidency.

Rather than just collect and reprint the texts, he includes an introductory commentary to each one. Anyway, today's NYT has a review by Jennifer Senior, which you just have to read. You may skip the book because you don't want to be that up close and personal with a black guy, but read the review. And, as you can see, she's very white.

Pardon me for piling on, but here's that word you so often see in these missives, although applied to a different problem:
With Obama's election, Coates briefly allowed himself to entertain the same belief. He was quickly disenchanted. It's clear he now believes this arc, at best, reaches an asymptote — that dastardly dotted line it can never quite touch. And even that's probably too optimistic a reading.

Near the end of the piece is the gut punch, and well deserved,
In the election of Trump, Coates sees an affirmation of his bleak worldview. "To Trump whiteness is neither notional nor symbolic but is the very core of his power," he writes in the final essay here, recently published to much attention in The Atlantic. "Every Trump voter is most certainly not a white supremacist," Coates writes. "But every Trump voter felt it acceptable to hand the fate of the country over to one."
[my emphasis]

02 October 2017

The Blind Leading the Blind

Just caught this from Feuerstein's twitter feed. Here's the money quote:
VP of research at State Street sent me an amazing chart. This yr 67% of companies in the $XBI are underperforming the $XBI itself by > 10%.

So, the Masters of the World of Finance are amazed that income and wealth, even among the Corporates is heavily skew right?? I betcha these guys all have MBAs from Harvard.

01 October 2017

Great Job, Brownie - part the second

Donald J. Quisling continues to bray about how wonderful the response has been to Puerto Rico. One of the news shows had a display:
Haiti earthquake - 50,000 troops and equipment one week in
Puerto Rico - 10,000 troops and little equipment one week in

Donald J. Quisling brays that Puerto Ricans haven't done enough to distribute materiel, which would be funny if it were reasonable. He brays that Puerto Rico is surrounded by water thus,
This is an island surrounded by water. Big water. Ocean water.

Spoken like any petulant six year old who's finally looked at a globe. But here's the salient fact
1,380 mi (1,200 nmi; 2,220 km) with ESSS stub wings and external tanks.

That's the ferry range of the Black Hawk helicopter. So, if you can get a squadron or ten to Miami, you can get them to Puerto Rico.
direct: Miami to San Juan - 1,031 miles
hopping: Miami to Nassau - 184 miles, Nassau to Turks - 469 miles, Turks to San Juan - 383 miles

So shut up. You could have had all the choppers in the USofA military distributing stuff all over the island in a few days. If you cared about a bunch of bankrupt dirty Spics who'd never vote for you. White grievance with maximum vengeance.

29 September 2017

Great Job, Brownie

We've been here before, and done a much better job of it. What job? Supplying a cut off population with the wherewithal for existence. Read up on the Berlin Airlift. It began in less time, post loss of access, than Donald J. Quisling has done with Puerto Rico and the USVI. It was, of course, run by the US military. Stodgy establishment.
The day after the 18 June 1948 announcement of the new Deutsche Mark, Soviet guards halted all passenger trains and traffic on the autobahn to Berlin, delayed Western and German freight shipments and required that all water transport secure special Soviet permission.

On 25 June 1948 Clay gave the order to launch Operation Vittles. The next day 32 C-47s lifted off for Berlin hauling 80 tons of cargo, including milk, flour, and medicine. The first British aircraft flew on 28 June. At that time, the airlift was expected to last three weeks.

Granted, the Berlin crisis had been on-going for some time, but Donald J. Quisling's dismissal of Puerto Rico is of a piece with W's disdain for New Orleans; now essentially white-ified.

27 September 2017

FIRE Alarm, part the second

Well, the mainstream pundit class finally has something to say about FIRE burning down the house. Were that this was the prevalent view. Sometimes, especially in the realm of human activity, data doesn't trump corruption.
Adam Smith, the father of modern capitalism, envisioned financial services (and I stress the word "service") as an industry that didn't exist as an end in itself, but rather as a helpmeet to other types of business.

Ya think? All those business school grads looking to Gekko-ize.
The financial industry, dominated by the biggest banks, provides only 4 percent of all jobs in the country, yet takes about a quarter of the corporate profit pie.

Minority rule: the many support the few. Only in Amerika. And Russia.
But it's not data or privacy or algorithms that are the fundamental issue with our financial system. It's the fact that the system itself has lost its core purpose.

Finance has become the tail that wags the dog.

Couldn't say it better me self. Well, may be.

26 September 2017

Thought for the Day - 26 September 2017

Recall the mentions, some recent, about how the Russian oligarchs got rich plundering the public resources? Well, here's more proof that Donald J. Quisling is on the same autocratic path. Drain the swamp? They're just a horde of swamp people. here.

24 September 2017

Don't Mess with Texas?

One of the more annoying bits of propaganda to emanate from the Right Wingnuts over the years was that Texas was special, and that Texans should really invoke their right to secede (there isn't one, as it happens). Texas has been, for the last century or so, just a bunch of Blue Eyed Arabs, sucking at the hind teat of petro. Geology has gotten smarter over the century, but it doesn't create that black goop. Either it's there or it isn't.

So, of course, they haven't seceded and want Uncle Sugar to send them gobs of moolah to fix Houston, which even an increasing number of Texans admit has been a cluster fuck for decades. The place floods like a wave pool without hurricanes just average rain storms, for crying out loud. I wonder if the Texans will also vote to fix Puerto Rico? Ya think?
It finally seems to be dawning on people that low taxes, less regulation and more oil are no substitute for actually governing.

Take a close look at that map. Notice something? Well, I'll tell you: greater Boston, including southern New Hampshire of course, is going great guns. As it has for a long time. Socialism works.
The tale of the Texas Miracle was a big fat lie: Plentiful oil, low regulation and even lower taxes are not a panacea. Sure, they don't hurt. But they don't help, not without consistent, well-considered state policy to attract and build businesses.

Still, there is hope. Harvey is forcing Texans to rethink our political dogma of small government at any cost. Harris County, which surrounds Democratic Houston and includes bedrock Republican suburbs, has placed everything on the table to prevent disasters in the future: from radical rezoning to land conservation and a giant Dutch-style engineering project to protect the region from another direct hit. That will take at least tens of billions of taxpayer dollars.
[my emphasis]

As Dr. McElhone (of UT/Austin) used to say, "Boy howdy!"

20 September 2017

Watch the Gap

I've lost count of the number of times that some comment on some board about this or that spiffy mobile device says that said device would be so much more better if it had a more better battery. Or, a comment that opines some new battery tech is just around the corner. My standard comment is some variation of "a better battery will appear when some genius invents an element better than Li". Consider that for a minute.

Comes the third iteration of Apple watch,
But the issues with Apple's new watch don't stop at bad reviews, inconsistent wireless, or even a short battery life. (It can only manage an hour of talk time when using LTE.)

Tim Cook, meet the asymptote of progress.


Serendipity (and some quasi-folk singers from the 1960s) happens when you least expect it. For some time I'd been intrigued by a title on Amazon,"Bayesian and Frequentist Regression Methods" by one Jon Wakefield. Never heard of him, but the table of contents promised a new approach: conpare and contrast real statistics and Bayesian foolishness (OK, that's harsh). So I've been wending my way through it in a desultory manner for a week or so. On the whole, IMHO, Wakefield demonstrates that Bayes offers little usefulness. Good on him.

He discusses a term I'd not run into, sandwich estimator (appears to be from 1960s and 1980s, though), as a palliative to heteroscedasticity. Now, for those who've not been through a baby stat or econometrics course as an undergraduate, one of the teehee moments was when the instructor starts discussing homoscedasticity and it's evil twin heteroscedasticity. Simply put, homo- means that variance is steady with increasing value, while hetero- means that variance increases with value. The problem with hetero- is that its presence mangles the maths' assumptions underlying the normal regression equations. The resulting regression results are "unreliable". Make mine with lettuce and tomato.

So, today Norman Matloff posts some slides from a talk and a new book on regression. The slides are linked to in his r-bloggers post. You should go through the slides, tons of fun. And more sandwich estimator. I will destroy you, heteroscedasticity!!!!

There are a slew of sentences that I'd turn into preamble quotes; they'd last nearly a year. My hero.
Contrary to popular opinion, statistics is not a branch of computer science.

And, my favorite
Myth #3: R 2 is only for linear models.
• R 2 (on either sample or population level) is the squared correlation between Y and Ŷ .
• Thus is defined for any regression procedure, even nonparametric ones like k-Nearest Neighbor.
• Example: Currency data.

Minority Report, part the third

Time has come for another installment in the Minority Report series (here and here for the basis). To recap, the whole point of a dictator is to extract value from the many and transfer to the few. One might argue that the 1% have been doing so for some decades, but Donald J. Quisling makes the gambit explicit. The mealy-mouthed Lefties keep bleating that Donald J. Quisling makes no effort to build a larger base. They ignore the facts staring, and hooting, them in the face.

So, now we have the Graham-Cassidy Trumpcare bill. Clearly even more Darwinist than the earlier attempts to take from the poor and give to the rich. The NYT has a write up today. In particular, a very nice graph showing the transfer. Likely done in R, of course. Note that the losers were those states that accepted Medicaid expansion, while the winners didn't. So, who's going to get the windfall moolah? The lower classes? Not likely. The key to block granting, of course, is the Alabama's of the world can use the money any way they wish. Mink coats for the governor and all his friends. Just like Joe Namath, Alabama player.

Guess Who's Buying ?

This from today's briefing.com @7:56
U.S. Treasuries have made it through another range-bound night ahead of the release of the FOMC Statement for September. The market is all but certain that today's update will not feature a call for another rate hike, but it is widely expected that additional guidance will be provided regarding the Fed's plan to begin reducing the size of its balance sheet. After recovering off this year's low, the benchmark 10-yr yield hovers near levels that have been revisited on multiple occasions since the middle of April.

Yield Check:
2-yr: UNCH at 1.39%
5-yr: -1 bp to 1.82%
10-yr: -1 bp to 2.23%
30-yr: -1 bp to 2.80%

Where, oh where, is the moolah coming from to drive up those prices? The 1% and corps? Ya think. Guess what happens if Donald J. Quisling and friends gives such 1) a huge tax break and/or 2) a tax holiday to re-patriate overseas moolah? Yet more moolah chasing Treasuries. The Donald J. Quisling solution: push through legislation to change how Treasuries are sold. No longer at auction, with a fixed coupon, but with a fixed interest rate. That way right wingnuts can explicitly transfer wealth from the many to the few without all the hand-waving that goes on these days.

The sell-off from the Fed is a hand-waving method to drive up the interest rate: increase supply of instruments will drive price down and interest rate up to where it should be for the idle money rich. Amerika, such a great country. Just don't get sick.

18 September 2017

Where Have Oli Garchs Gone?

For those with short memories, this is how the Russian Oligarchs got rich.
Zinke declined to say whether portions of the monuments would be opened up to oil and gas drilling, mining, logging and other industries for which Trump has advocated. It was not clear from the memo how much energy development would be allowed on the sites recommended for changes, although the memo cites increased public access as a key goal.

You wanna bet?

16 September 2017

Coin of the Realm

About two years ago, in these endeavors, was this
2) bitcoin, by design, is a pyramid scheme

And, not for the first time, the mainstream pundits didn't follow my lead. Sigh. But wait, there's more! In today's reporting, we find that a cryptocurrency vendor has second thoughts. Very, very second:
the cryptocurrency market "increasingly feels like a bunch of white libertarian bros sitting around hoping to get rich and coming up with half-baked, buzzword-filled business ideas."

Other high-profile skeptics have sounded the alarm about a potential crash in the crypto market, including Jamie Dimon, the chief executive of JPMorgan Chase, who last week called Bitcoin a "fraud," and compared the current digital money craze to the 17th-century Dutch tulip bubble. And even true cryptocurrency believers have started to worry that I.C.O. mania won't end well.

The goal, as always, is to get "in on the ground floor"
But more dollars are still pouring into cryptocurrency ventures every day, as giddy investors ignore the warning signs and look to multiply their money.

I wonder, how many stock certificates of pets.com do you gentle readers have lining your bird cages?

Alternative Fax

For those who may have missed it, the Equifax security chief was a music major. Now, it is well known that facility with music often accompanies one with math. But, come on!!!
[Susan Mauldin, who had been the top security officer], a college music major, had come under media scrutiny for her qualifications in security.

Well, no shit, Sherlock. I'll leave the sexist and elitest rants to the reader.

Here's a bit more detail.
Equifax "Chief Security Officer" Susan Mauldin has a bachelor's degree and a master of fine arts degree in music composition from the University of Georgia. Her LinkedIn professional profile lists no education related to technology or security.

And, according to further reporting, here LinkedIn pages have been scrubbed. My guess as to how she got such a position: it ain't what ya know, it's who ya know. I expect we'll find out the truth in due course.

14 September 2017

FIRE Alarm

For some time, these endeavors have discussed data analysis, and the (somewhat) artificial divide between micro and macro versions. There is the real difference, in that micro analysis (nearly) always has population data: all the products, inputs, customers, and the like. Macro analysis, on the other hand, nearly always is limited to sample data. What the alt-right call fake news, when the numbers don't fit their pre-determined result. What the non-stat literate don't or won't admit is that large sample theory kicks in with a rather small number of observations. Macro data sets easily exceed such requirements. The problem is that macro data is seldom actually used in setting policy. Policy is set by political favor-making, irrrregardless of the data. Sigh.

Along the lines of macro data, I've implored gentle reader to dig into FRED data. In particular the simple fact that FIRE has burned down the economy. Not a lot of mainstream pundits have picked up on this. Until today, of course.
In the postwar era, finance has grown enormously as a share of the global economy, often feeding debt-fueled bubbles. In 2015, the economist Alan M. Taylor and his colleagues looked at data going back 140 years for 17 leading economies. Before World War II, there were 78 recessions — including only 19 that followed a bubble in stocks or housing or both. After the war, there were 88 recessions, a vast majority of which, 62, followed a stock or housing bubble or both.

This leads, of course, to
Today, global financial assets (including just stocks and bonds) are worth over $250 trillion and amount to about 330 percent of global gross domestic product, up from $12 trillion and just 110 percent in 1980. Traditionally, economists have looked for trouble in the economy to cause trouble in the markets. But the ocean of money in financial markets is now so large, it's possible that ripples on its surface could trigger the next big downturn.

13 September 2017

The End of Civilization

The 19th and 20th centuries gave us things like the steamboat, standardized rail networks, the periodic table, vaccines, and the dishwasher. Today Apple gives us
One of the other features for the technology shown by Apple was the ability to generate a face mesh and map new textures to it, such as new SnapChat 'masks', or animated emoji in Message. The hardware will map 50 muscle tracking points, and a user can choose one of twelve animal emoji (fox, cat, dog, pig, unicorn, poop emoji) and record a ten second message where the 'ani-moji' will mimic in real-time how the user is moving and speaking in order to send to the other person. Apples plan here is to open the resources up to developers to use in their own applications.

If any of you dear readers have doubted these endeavors' insistence that we've reached the asymptote of progress, doubt no more.

Thought for the Day - 13 September 2017

In case it hasn't been obvious, Donald J. Quisling has been very, very busy not draining the swamp. In fact, he's been very busy stocking it with alligators and other predatory critters.
Tens of thousands of former students who say they were swindled by for-profit colleges are being left in limbo as the Trump administration delays action on requests for loan forgiveness, according to court documents obtained by The Associated Press.

Putting the crooks in charge isn't draining the swamp, of course.
In August, Education Secretary Betsy DeVos picked Julian Schmoke Jr., a former associate dean at DeVry University, as head of the department's enforcement unit. She also has tapped a top aide to Florida's attorney general who was involved in the decision not to pursue legal action against Trump University to serve as the agency's top lawyer. More than 2,000 requests for loan forgiveness are pending from DeVry students.

Isn't just such corruptions what you would expect from a convicted crook?

Other Trump administration agencies also have hired staffers who previously worked on behalf of the industry they now regulate. For example, Nancy Beck, deputy assistant administrator at the Environmental Protection Agency, used to work at the American Chemistry Council, the industry's leading trade group.

And, of course, the creme-de-la-creme of corporate enablers, Scott "To use time and effort to address [climate change] at this point is very, very insensitive to this people in Florida" Pruitt running EPA.

09 September 2017

I Thought So

From the first track that showed Irma making a hard 90° turn north, I wanted to know why. Not one of the dozens of forecasters mentioned why. My suspicion was that a low pressure system would set up to the north and west of Florida about the time that Irma got there. The reason, as all armchair meteorologists know, is that lows spin counter-clockwise and would thus sling-shot Irma up the peninsula.

And so it is. Now, it's true that normal highs spin clockwise and lows counter-clockwise, and they interact to push each other around. Turns out, which should have been obvious but wasn't, hurricanes are very unique in terms of their internal wind and temperature vis-a-vis other types of storms.
"With a tropical cyclone, its very symmetric. The temperature differences driving it are vertical--there's warm, wet air below, and cool, dry air up above--so there's a vertical circulation, but it doesn't move in a horizontal direction," said Neal Dorst, a research meteorologist at NOAA's Hurricane Research Division.

"There's no impetus driving a tropical cyclone--it will have a tendency to stay where it is," he said. If a hurricane appeared on a globe with no other weather systems, it would drift northerly only at a couple miles per hour, thanks to the Coriolis effect. It would not move in any other way, he told me.

So that's why Irma isn't headed back to Texas.

04 September 2017

Where In the World Is...

Being New Englander, born, bred, and mostly resident for most of my life; I have an inherent trust in pharma that live here. The Boston, Cambridge, 128 corridor companies especially. On the other hand, San Diego outfits seem to more often end up looking a tad shady. Or, at least, seem to fail more often. This is just the latest.
Otonomy (OTIC) stock crashed to a record low Wednesday after its Meniere's disease drug failed to reduce vertigo in a Phase 3 trial -- prompting the biotech to scrap its development.

Scrapping a failed drug is not completely unique; the worst offenders claim some subset responded very well, and the company will pursue the drug with further study. blah, blah, blah. Issue more shares, and the CxO class keep living well.

What's worse, sometimes (again, it seems epidemic in San Diego) a Phase III trial will proceed even when the Phase II was marginal at best. Here's what they had to say about the Phase II trial, that justified continued development of the drug:
Otonomy has completed a randomized, prospective, double-blind, placebo-controlled single-dose Phase 2b trial in a total of 154 Meniere's disease patients. Results indicate that OTO-104 narrowly missed the primary efficacy endpoint (p=0.067) but achieved statistical significance (p<0.05) for multiple prospectively defined secondary vertigo endpoints at multiple time points. Based on these results Otonomy intends to initiate two parallel Phase 3 trials, with one of the trials expected to begin by the end of 2015 and the second trial expected to begin during the first quarter of 2016. OTO-104 is also being evaluated in a multiple-dose safety study in the United Kingdom in patients with Meniere's disease, and enrollment has been completed with a total of 128 patients.

IOW, we missed, but we're going to plow ahead anyway. The Phase III came in with a p-value on the primary of... .62. That's not just a whiff. Very San Diego. I often wonder what scientists who work for such companies think about when they go to beddy bye at night? Same for the biostats who have to make a legitimate narrative from the data. When it's this bad, there's nothing to do but look for another micro-cap pharma in need of a number cruncher.

And, not for nothing, the drug was yet another old one re-purposed. That and Orphan Drug are the increasingly common paths in drugs these days.

02 September 2017

We're Gonna Need a Bigger Sponge!!

That's, in essence, what enterprise IT managers have been saying since the invention of the commercial computer. For the better part of 60 years, we've gone from drums of 4 by 16 inches to 3390 washing machine sized discs (for the IBM mainframe) to now with the 3.5 inch sealed drive being the predominant norm. Even mainframes use them emulating CKD geometry. What's next?

This is Godzilla.
Migrating to flash is paramount, but existing SSDs do not match the form factor, interface, and power envelope of HDDs, forcing users to buy all-new systems. With ExaDrive, data centers can immediately rip-and-replace HDDs with flash. ExaDrive supports the standard SAS interface and is optimized to fully utilize the volume of the 3.5" form factor. As a result, ExaDrive-powered SSDs offer 5x the capacity of nearline HDDs in the same size and power budget, enabling a 5:1 reduction in rack space and power per terabyte.

01 September 2017

Thought for the Day, 1 Sep 2017

Contempt for governance at the statehouse generally, and the local level specifically, is why Houston is wiped out. They did it to themselves in the name of "freedom". So, they want to be free to do as they please. The Blue states shouldn't send them a dime, because they'll just do it again.

29 August 2017

We Are The World

Yesterday's cautionary tale of dog ownership began thus:
Perhaps the defining characteristic of humans is the drive to divide. We classify just about everything we know, or just think we know, about the world into, generally, two groups. Us and them. Catholics and Protestants.

I didn't know then that Gina Kolata would take up the theme today. Hers is not the first news report I've seen dealing with the trauma of white folk finding out they're not really. And, no surprise, much more of the white supremacist South isn't lily white than elsewhere.
The chances of having African ancestry were highest in the South, and highest of all in South Carolina, where at least 13 percent of those who said they were white had African ancestors.

Boy, that has to burn some, going down. Like chugging grain alcohol. Good on you.

And, of course, there's the other side
Among those who said they were black, genetic ancestry over all was 73.2 percent African, 0.8 percent Native American and 24 percent European. Experts say the large proportion of European DNA found in African-Americans can be traced to before the Civil War, and the rape of enslaved African women.

I wonder if the Klan will admit them. After all, they're more tainted white than whites are tainted black. Kumbaya.

25 August 2017

Dueling Banjos

Once again, into the data fray. This time it's not just a trivial pissing contest. Now, this is a hard data field, not some social science feud over macro policy based on fudgy sampling data. It's all about super-priced heart drugs.
Not surprisingly, each side takes issue with the other's study design and data. They question each other's assumptions about the risk of heart attacks, strokes, and other cardiac events - a key figure that gets plugged into their computer simulations - and they use different thresholds for the proper value of a year's worth of "quality of life."

Well, yeah, there is a bit of social science thumb on the scale. Moreover,
There is another point of divergence in the Fonarow and Kazi studies. When they modeled cost savings from evolocumab, the former factored in productivity - the economic cost of a heart attack victim not going to work, for example. Kazi says his group's study sticks to just the medical costs saved - the hospital stay, the follow-on procedures - by avoiding a cardiac event.

One of my pet peeves with the social science use of data, the majorest, is the continued imputation of "loss of productivity" for all manner of factors. Pharma has been executing "outcomes based pricing" for a while. This is just a fancy way of saying, "my drug saves your life, so you owe me the rest of your life's earnings". I read one "estimate" that the eclipse "cost" $700 million in "lost productivity". As if public and private bureau rats not sitting at their desks for a few minutes has any impact at all. Few do anything productive, ever. A few minutes burning their corneas, on balance, prevented more London Whales from breaching than lost useful output. The one and only case of directly measurable productivity is piece work. Tender reader, you may never have heard of that. Here it is.

18 August 2017

Hi Ho Steverino

As, I suspect, most folks have done, I took it as an article of faith that Bannon's fortune (whatever it may be) was made at Goldman. The fact that he pronounced himself a Leninist never made much sense. Nor, as mentioned in earlier missives, how he or Donald J. Quisling or any President could compel corporations to practice economic nationalism. You have to be a dictator to force corporations to behave against their near-term (aka, the CxO class's) best interest. Do I figured Donald J. Quisling wet dreams of himself as Orange Julius Caesar? But of course. Start a war. Declare martial law. Suspend Congress. Declare himself Dear Leader (he got a bit ahead of the game at that first Cabinet meeting. yuk.).

So, I let my fingers do the walking through the innterTubes, and came across this diatribe from last spring. Sounds much like what one might expect the Oracle of Delphi to say.
In 1985, Bannon was a Navy vet in his early 30s fresh out of Harvard Business School who went to work at Goldman Sachs working in M&A. He lasted there until 1990 when he left as a VP to start his own boutique M&A firm. Now, for the kids and Millennials out there, being a VP at Goldman in 1990 was even more junior than it is now and boutique M&A was the late 80s Wall Street version of a craft cocktail bar; they seemed to pop up everywhere and you definitely knew someone who knew someone who started one.

The stake in the heart:
A born-again blue-collar class warrior like Bannon cannot look back fondly on years of running models 20 hours a day in the pre-internet era only to realized that 33-year-old analysts with no prep school connections had limited futures at Goldman Sachs.

I guess Steve has feet of clay.

17 August 2017

About That CEO Council

Bannon has been gulled into talking plainly in interviews that went live last night (here, and here. They're worth reading in total, but one point is germane here: is there really such a thing as economic nationalism?

Of course not. The CEOs quit just because they want all that globalism. They've spent decades destroying the middle classes, particularly the blue collar segment. They could have partnered with unions in the North to support the blue collar middle class, but instead went South and overseas. Nationalists, economic or otherwise?? In a pig's eye. Which brings us to the real data, finally, on their game. Here's the nut. Autos have been the vanguard of killing labor. The white collar Northern Blue states have been less impacted, in the way explained by Baumol. Whether Watson-ish machines will kill off these folks too remains to be seen. What's the end game, or the look of the world in the limit? The principle problem of rising capital in production is that unit fixed cost rises: you can't layoff a machine, you must still pay for it. So long as output remains steady or rises to the capacity of the capital, you can get away with it. But as capital's share of GDP rises, there's by definition fewer bucks to buy output; aggregate demand declines. A death spiral. Oops.

FRED data shows that GDP going to labor continues to decline. Just today, there's more reporting on the puzzlement within the Fed that inflation just won't come back.
"It would not be desirable," the minutes said, "for the current regulatory framework to be changed in ways that allowed a re-emergence of the types of risky practices that contributed to the crisis."

Good luck with that. Social Darwinism in finance is what the Right Wingnuts dream about all day and night.

The public number, U3, is increasingly viewed with suspicion, just because at under 5% we've always seen labor incomes rise in the past, but not now. There has to be a reason. And that reason is total employment as measured by U6 isn't nearly as pleasant. Wages remain stagnant. Demand remains stagnant. Growth doesn't happen. The rich get richer and the poor attack each other.

15 August 2017

Fake News

Some news really is fake. Here's the headline from my CBS News front page: "The country where Down syndrome is disappearing". A reasonable person might infer from that sentence that some country (Iceland) has somehow found a "cure" for Down. Or at least has found a way to keep it from "spreading" into further generations. Like polio or smallpox. Ya think?

Well, no. Iceland just is more resolute in aborting tainted fetuses than most countries. There is no data that the incidence or prevalence of Down is diminishing in Iceland. There is, as yet, no evidence determining a cause. Down isn't inherited, as recessive characteristics are. It's not race based. It is idiopathic.
Down syndrome is caused by a random error in cell division that results in the presence of an extra copy of chromosome 21.

13 August 2017

Touching Me, Touching You

So, let me get this straight, once again. Clinton lost because 77,900 more shit kickers in shit kicking counties in three states voted for Donald J. Quisling than for her. Explain to me how any Democrat could reach out and touch the votes of such deplorables? Not Dixiecrates, but real Democrats.

10 August 2017

Second Thought for the Day, 10 August 2017

[T]hey've got to draw in their horns and stop their aggression, or we're going to bomb them back into the Stone Age. And we would shove them back into the Stone Age with Air power or Naval power -- not with ground forces.
-- Curtis LeMay/1965

Thought for the Day, 10 August 2017 [update]

As mentioned before in these endeavors, and bears repeating today: the SOP of would be dictators is to instigate war, institute martial law, and claim all governance in the name of protecting the homeland. The shit kickers who bought Donald J. Quisling's white supremacy spiel will buy this transparent ruse. Will the rest of us?

in answer to a comment in another version of these endeavors, I offered:
Well, another few factoids to consider:

- Donald J. Quisling claims to be second only to Lincoln as President

- the White Power folks consider the Civil War to have been instigated by Lincoln

- Lincoln did institute martial law

Quisling would be doing the right thing.

07 August 2017

Oh My God!!

This missive began in the pre-sleep twilight of last night, wherein the idea of server-centric applications remains ever more true, given the soon to be death of the java plug-in, aka applets. I went to CSC a lifetime ago to do, as it was told to me, "heavy weight database development". Turned out to be VSAM files ported to DB2 on z, run by the existing 40 year old COBOL with revised copybooks and a bit of front-end lipstick. Yikes!! Still COBOL doing RBAR against file data. The products actually ran shitier with the port. Enough so that a few, wise, clients stayed with the VSAM release. Since source code licensing was generally used, such clients took over the modification and extension.

The new and improved version used an applet as the browser front-end, and one of my retread COBOL java colleagues told a prospect "we prefer to do transactions in the client". Heavy weight database development, my eye. A total waste of DB2 fees.

In the olde days of COBOL/CICS/VSAM, the distinction twixt client and datastore was a bit fuzzy, since it's all COBOL and CICS controls the transaction.
The true beauty of the CICS/DB2 attachment is that it's designed to be a two-phase commit process.
(Or, one might say, it's two TPMs in a death match! You have to read that piece, which I found after I wrote my snark; it's a hoot.) But the danger of being hung out by an unsupported infrastructure is minimal. After all, no one got fired for buying IBM.

So, reports re-appeared recently that java 9 will be minus the plug-in. No more applet. When I returned to quant employment, the major aspect was Progress 4GL/database applications. As it turned out, the Progress database at that time was SQL-86 compliant; which means it was just grandfathered into The Club. So, the 4GL was a RBAR language against indexed tables/files. The thing about proprietary languages is that you're betting that the vendor will out survive your business. Progress has. The plug-in and applets haven't.

So, today we find Godzilla SSD release.
The PM5 SAS SSD sets new records by offering capacities of up to 30.72 TB in a 2.5" form factor, and sequential transfer speeds of up to 3350 MB/s (reads) thanks to support for four-port SAS MultiLink. SAS has always supported dual-port drives, with the two ports either used in a failover configuration for high availability or bonded for high throughput.

The end result of all this is that highly (if not massively) parallel processing of relational data on the server is now really quite cheap. Time to treat the browser as an xterm; just another I/O device with all the smarts in the database. The gates to the Emerald City are just ahead. Let's build our applications the way Dr. Codd told us to. OK?

02 August 2017

Farther on Down the Road

The end of the Yellow Brick Road is running R inside the RDBMS. PL/R for Postgres was the first I worked with. The commercial databases offer similar support, but at Big Bucks. Alas. Today we find a new odbc package for R which makes a half-step farther down the Road.
But the real power comes in being able to use high-level functions from the dplyr package and have the data processing run in the database, instead of in the local R session.

If nothing else, this package admits that RDBMS semantics (aka, joins and such) belong there, not in R. Come on guys!! If you can figure out a bastard language like R, SQL is a piece of cake.

31 July 2017

Thought for the Day, 31 July 2017 [update, yes so fast]

So, we have the latest spewing from the "Lord of the Flies" White House:
I'm not Steve Bannon. I'm not trying to suck my own cock.

During the election, we had this from HRC:
You know, to just be grossly generalistic, you could put half of Trump's supporters into what I call the basket of deplorables. Right? The racist, sexist, homophobic, xenophobic, Islamaphobic -- you name it. And unfortunately there are people like that. And he has lifted them up. He has given voice to their websites that used to only have 11,000 people -- now 11 million. He tweets and retweets their offensive hateful mean-spirited rhetoric. Now, some of those folks -- they are irredeemable, but thankfully they are not America."

Ya think may be she was right?

Well, he didn't last long

26 July 2017

I Still Hate Neil Irwin, part the ninth [update]

Poppy Bush called it voodoo economics. Its zealots call it supply side theory. It's all bogus wealth transfer from the many to the few. If any form of supply side were true, producers would rev up the production lines whenever demand goes slack. They don't do that, of course.

The inevitable inference is that growth is demand driven. Yet, it takes a 'radical' paper to make the point.
It's a chicken or egg problem: Does low productivity cause slow growth, or does slow growth cause low productivity?

The second possibility is the provocative argument of a new paper published Tuesday by the Roosevelt Institute, a liberal think tank. The paper argues that the United States economy is not actually closing in on its full economic potential and has plenty of room for continued growth -- so long as the Federal Reserve doesn't put on the brakes of the expansion prematurely.

The data, and logic, lead one to conclude that capitalists respond to increasing demand, not to decreasing cost. The former impels them to produce. The latter to pocket the savings.
"On Mondays and Wednesdays, economists argue that wages are low because robots are taking people's jobs. On Tuesdays and Thursdays, it's that we can't have wages rise because productivity growth is low," said Mr. Mason, an economist at John Jay College. "Both can't be true."

In other words, instead of worrying so much about robots taking away jobs, maybe we should worry more about wages being too low for the robots to even get a chance.

Foxconn, which may or may not be building plant here, has been doing the robot thing in response to labor costs (that's 2011, and there're lots more recent reports of carrying this out).
Yesterday, Foxconn announced (at an employee dance party of all places) that they're planning on buying some robots to replace their human workforce. And by some robots, they mean one million robots over the next three years.

So, in addition to the segue from actual production in the economy to overhead labor (and the loss in global productivity), we find that we can't get growth if wages don't expand to demand more of what the economy actually produces. The lower and middle classes don't consume financial services to the degree that the 1% does.

Well, that didn't take long. Hot off today's presses is more info on Foxconn.
The technology futurists Andrew McAfee and Erik Brynjolfsson of MIT recently told Yahoo Finance that the technological change of the last 20 years is nothing compared with the imminent revolution to be wrought by artificial intelligence and machine learning. "We are never again going to have a large, prosperous, stable middle class in this country doing routine industrial-era work," McAfee said. "The assembly line jobs of the 1970s, those jobs are gone. To try to go back to the 1950s, I find that un-American."

Un-American?? A bit extreme. Who's gonna have the moolah to buy the stuff? London Whales?

Neo Nazi Youth

Just when you figure Donald J. Quisling couldn't be anymore transparent a dictator, he goes and turns the Boy Scouts into Neo Nazi Youth. All because 77,900 shit kickers had just enough brain stem activity to fill in the circle.

21 July 2017

Divide and Conquer

Well, it does the olde heart a bit of good to realize that the mainstream pundits have finally caught up with Your Humble Servent and figured out that the left/right political war isn't based on Red states and Blue states, but rather on city slickers and shit kickers. The shit kickers are poor and unhappy mostly because they continue to elect right wing fascists to state and local governments. Said legislators, continue, to ill-educate their citizens. God, guns, and abortion being the only subjects. They're competent to be biblical goat herds, but not much else. Once again, go look at the voting results map from last year to see the real truth.
This map tells many particularly interesting stories on which I'll elaborate in future posts, but suffice to say that most of the precinct swing can be explained by one variable: education level, perhaps augmented somewhat by race and ethnicity.

As mentioned here more than once, the flow of money inter-state, is unambiguously Blue to Red (via DC) and has been for decades, perhaps dozens of them. The shit kickers are the moochers. Without medicaid, they'll have nearly no hospitals. And, of course, Medicaid is mostly white. Contrary to the right wing propaganda, Medicaid isn't all about negro ghetto hoes popping out runts. Which brings us to the Constitutional justification of Senate structure to "protect" the small population rural states from the rapacious urban states of the Northeast. Well, that turns out, with just a quick wiki-look to be a totally bogus argument, even at the time.

urban population, USofA/1800: 6.1%
urban population, USofA/2010: 80.7%

So, it isn't surprising that 19th century USofA was run by uneducated shit kickers. And so it will be again, if Donald J. Quisling and Sessions get their way.

20 July 2017

Inside Quisling's Brain

The NYT interview went public during the MSNBC (I know, Snowflake News) nightly shows. One of the points of wonderment amongst the groups assembled was Donald J. Quisling's assertion that he wouldn't have appointed Sessions if he told Donald J. Quisling that he'd be recusing himself in the Russian investigation. In sum, "Mueller wasn't appointed yet when Sessions was offered the job." Oddly, there is a way to connect the dots in such a way that such an assertion makes (half) sense.

Here we go.

At the time of considering the appointment, Trump and Sessions knew some facts.

1 - That there was an investigation into Russian meddling, including whether or not the Donald J. Quisling folks had aided and abetted said meddling.

2 - That Sessions was knee deep in the campaign.

3 - That Sessions, at least, knew he had lied about meeting with Russians.

4 - That DoJ protocol required anyone in DoJ and possibly a subject of a DoJ investigation must recuse.

So, Sessions, had he thought things through, could have apprised Donald J. Quisling of the situation, and it's impending implications. But they both have the same voter suppression agenda, above all others, so it just slipped his mind.

And, not mentioned by said pundits (that I heard, at least) was this smoking gun:
Asked if Mr. Mueller's investigation would cross a red line if it expanded to look at his family's finances beyond any relationship to Russia, Mr. Trump said, "I would say yes." He would not say what he would do about it. "I think that's a violation. Look, this is about Russia."

Why is that a Dirty Harry moment, you might ask? All along, Donald J. Quisling has been braying that he had nothing, nothing at all, to do with Russia. But here he admits that he has financial ties to Russia. And some may be quid pro quo for the meddling. Ya think?

So, yes, Donald J. Quisling is in hock to Russians and wants to be the USofA's Putin. A match made someplace.

The half wrong part, of course, is that Donald J. Quisling isn't (yet) Putin and the DoJ isn't his personal enemies unit.

18 July 2017

That Horizontal Boogie

It seems to me, perhaps alone, that the venue for Big Data (lots of machines munging lots of data) shrinks as time goes on. 64 bit address space covers lots of cases. And the power of the RDBMS just gets wider. Here's a quote from an AnandTech review of a new crypto motherboard:
Like other boards targeted at mining, there are a plethora of PCIe x1 slots. Having several PCIe x1 slots on mining motherboards make it more cost effective to simply add more video cards into a single system, rather than expanding to additional systems.

The horizontal boogie is fun in some circumstances. Not so much in others.

He Who Is Blessed

An ongoing theme of these endeavors is that data analysis of human-defined processes is fraught with danger. Will Robinson!!! I've had a number of comments questioning the utility of quant in the realm of human processes spiked. Not gratuitous enough, I guess. Well, this post goes so far as to point out that even God's rules, while fixed, can lead to spikes up or down in the series.
In time series analysis, structural changes represent shocks impacting the evolution with time of the data generating process. That is relevant because one of the key assumptions of the Box-Jenkins methodology is that the structure of the data generating process does not change over time.

Take that, you giants of financial quant.

17 July 2017

Minority Report, part the second

Well, this has turned into a series of episodes. Here's some of today's reporting demonstrating, once again, that Donald J. Quisling is just another Third World Dictator. All he cares about is his cabal of oligarches and billionaires, not bringing the country together. He keeps the shit kickers in the Empty States in thrall by screeching God, Guns, and Abortion. The whole point of dictatorship is to shift resources from the many to the few.
On Thursday, President Trump will mark six months in office with the lowest approval rating of any president going back 70 years.

A new national poll out Sunday shows just 36 percent of Americans approve of Mr. Trump's job performance so far.

Mr. Trump's disapproval rating has jumped to 58 percent.

Again, go check out the ongoing research confirming that money flows from Blue States to Red States through DC. Donald J. Quisling will only accelerate the flow, and blame the Effete Eastern Intellectuals for the failure of his Voodoo Supply Side tax cuts.

10 July 2017

Burn, Baby, Burn [update]

Well, as the first quote says, this is clearly treason. Donald J. Quisling, Jr. meets with a Russian intelligence person, and lies about it.

Time for the NSA to burn some S&M (no, that doesn't mean what your dirty mind thinks) and give us all the audio and signals intel they have on this dirty crew. Subversion of democracy is the most important attack to punish.

[update 11 July]
The flames: the NYT now reports Donald J. Quisling, Jr. was told explicitly that info was coming from Russia. The Intelligence Community is slicing off its pound of flesh. How does one think the emails might have surfaced? Who would have access to them, outside TTO? Hmmm?

09 July 2017

The Next Version

Regular reader will likely recall earlier missives on Yellen's determination to raise Fed managed short-term rates, in particular the inevitable rate inversion and the pernicious effects of same. Well, may be not. Recent reporting states that the Fed is about to unleash the Treasuries it's been holding since the advent of QE. Increase supply, decrease price, and raise the interest rate. Since this also raises the rate on new issues, of course, then (of course) the little people who actually pay taxes gain the additional benefit of giving yet more of their moolah to the idle rich.

Next thing we'll hear is that Donald J. Quisling decrees that data collection and reporting from BLS, Commerce and the rest will be suspended, since such data is the source of so much fake news.

04 July 2017

I Still Hate Neil Irwin, part the eighth

Yes, but he's nearer The Truth today, wherein he compares consumer confidence survey results to just extrapolating recent hard data. People are confident when they're certain that they'll have at least as much free moolah to spend tomorrow as they do today. More tomorrow would be better, of course.
Confidence isn't some magic elixir for the economy: Businesses will hire and invest only when they see concrete evidence of demand for their products, and consumers intensify their spending only when their incomes justify it.

Something of a non-sequitur, but still yet another stake through the heart of the Voodoo Supply Side Economist.

In my dead-trees version, Irwin shares the bottom of the first Business Section page with Neal Boudette, who introduces us to yet another canary.
Luxury-car makers began to grab an increasing slice of the American car market as baby boomers reached their peak income years and splurged on upscale automobiles. In 2007, they had 11.8 percent of the market, up from about 9 percent in 2001.

You'd think that all those Smartest Guys in the Room would recognize a non-repeatable bump in their demand function based on once-in-a-lifetime (props to the 'Heads) demographics. Perhaps not.
They had some initial success, but many models introduced in the last several years are now floundering. In June, sales of Cadillac's ATS were just 1,185, 37 percent fewer than in the same period a year ago. BMW i3 sales this year have totaled fewer than 3,000 cars, less than half the pace of two years ago. At Mercedes-Benz, sales of the CLA declined 8 percent in June -- and are down 37 percent in the first six months of the year.

Automotive Goodwill Industries might actually exist? They're not used cars, after all. They're Previously Owned Certified Batmobiles.
But more difficulties for the luxury brands may be on the way. Their efforts to sell new cars this year are facing increased competition from used cars that were leased two or three years ago and have been turned in to dealers. Many have been driven fewer than 40,000 miles and sell for about half the price of new models.

Could it be that the ranks of the aspirational 1%-ers are thinning?? Ya think?

02 July 2017

Still Can't See the Voodoo

Trust me. If you deep dive through these missives you will see, in various syntaxs, the following:
if the Fed persists with raising short-term rates, you'll get a rate inversion that'll make your head explode

Well, now Jeff Somer gathers up some quotes from "experts" to weigh in on the possibility.
Simply put, while the Federal Reserve has been raising short-term interest rates since December, the bond market hasn't gotten the memo. The longer-term rates that are set through bond market trading have, for the most part, been declining, though there was a brief reversal in the last few days. But the disconnect over the last few months is a sign that bond investors believe economic growth and inflation are still weak and the Fed's actions are premature.

What's truly stupid: Yellen and the rest of the Fed management can see this happening in real time. Moreover, they fully well know that their control of short-term interest is far less than absolute and their control of long-term rates is non-existent. Yet, she persists. Why?
"... The economy keeps growing, the stock market keeps going up, yet inflation remains very low. Where are we heading? There are many possibilities here. This isn't the economy we used to know."

No. It isn't. And, as these missives (and others) have asserted for some years, the hegemony of FIRE over the rest of the economy has to lead to slower growth, as typically measured. Once again, Baumol's book ("Performing Arts, The Economic Dilemma: a study of problems common to theater, opera, music, and dance") on service sectors is a must read. In sum, capital can replace labor only when labor is menial. Such as accountants and para-legals.

Well, those in the know do know: it's Poppy Bush's Voodoo Economics all over again. All that capital infusion went to the 1% and corporations, who've either sat on it, or begorrah!, bought and bid up the price of Treasuries. By simple arithmetic, that drives down the interest rate. So, in the end, the 99% have no more moolah to buy stuff, so the prices of that stuff remains phlegmatic, while fiduciary assets soar. They could use all that moolah to invest in physical investment and added production, but of course they don't. These pundits really need to read their Samuelson.
For now, the rally in risky assets like stocks continues unabated, while the conflict between the Fed and the bond market continues. Fed officials indicate that they are determined to keep raising short-term rates and to begin reducing the Fed's bond holdings -- perhaps preparing the central bank for action whenever the next recession comes.

At a bare minimum, the policy choices ahead are difficult. And for investors, there is ample reason for caution.

Despite what the Rand-ians say, any degree of Government makes for winners and losers. The only issue is whether Government favors the most or the Elites.

28 June 2017

My Signature Accomplishment

When I saw that first EO display by Donald J. Quisling, I thought of a Rorschach blot. Well, others have been weighing in on that scribble since then, too. Here are some of their thoughts.

Candace Sutton
"When a script is completely devoid of curves, the writer lacks empathy and craves power, prestige and admiration.

"Besides the bigheadedness that shows in this script there is something else that is rather oversized -- the 'p' in 'Trump'. This large phallic symbol shouts, 'Me ... big hunk of man'."

Linda Rodriguez McRobbie
[Sheila Lowe, a Ventura, Calif., handwriting analyst] first came across Trump's handwriting and signature in the 1990s and has been keeping a professional eye on it since. "Handwriting changes over time in people who grow and change. . . . It's like a road map of who you were," she said. Trump's handwriting, she said, has remained largely consistent for the last 20 years. "He's the same person he was all those years ago -- an empty narcissist."

Lily Pickard
Tracey Trussell of the British Institute of Graphologists has taken a look to see what it can reveal about the man soon to be taking up the Oval Office.

"She explains that the large writing, upright slant and long tall letters indicate a whole host of characteristics about Mr Trump. Ms Trussell says: "His signature transmits wild ambition, dynamism, bravery and fearlessness.

"He's hungry for power and has both determination and stubbornness in spades."

Katy Waldman
After staring at this accursed cursive for hours, I've come to the conclusion that this signature is a cry for help. Donald J. Trump is trying to tell us that he's not really Donald J. Trump. His real name is AuuuUUuuuuuA.

You get the idea: a 6 year old dictator. That's a bit redundant, of course.

25 June 2017

You're Not as Smart as a Fifth Grader

A continuing thread in these endeavors is that the rose-colored glasses assertions of the billionaires and their fellow travelers, that we're going through the same sort of transition as happened during farm-to-factory, is bunk. The main point made in these missives is that the higher incomes from factory work over farming didn't demand higher skills or IQs. If anything, assembly line drones needed smaller brains than any marginally successful farmer.

So, today we get the experience of an AI expert. He agrees.
Unlike the Industrial Revolution and the computer revolution, the A.I. revolution is not taking certain jobs (artisans, personal assistants who use paper and typewriters) and replacing them with other jobs (assembly-line workers, personal assistants conversant with computers). Instead, it is poised to bring about a wide-scale decimation of jobs -- mostly lower-paying jobs, but some higher-paying ones, too.

Anyone who thinks Donald J. Quisling will stop the carnage is an idiot (nearly all of those "saved" jobs in Indiana, fewer than he claimed of course, are headed South). It's no surprise that the article addresses the key question: new jobs will be a small fraction of removed old jobs. And mostly at lower wages, if social darwinism is the sole wage setting mechanism.
Who will pay for these jobs? Here is where the enormous wealth concentrated in relatively few hands comes in. It strikes me as unavoidable that large chunks of the money created by A.I. will have to be transferred to those whose jobs have been displaced. This seems feasible only through Keynesian policies of increased government spending, presumably raised through taxation on wealthy companies.

Do you really think that Donald J. Quisling will support that? Well, do you punk?

It's also worth remembering, though not mentioned by this author, that the current procession of job creation is in FIRE. Which is to say jobs that cater to the 10% and 1%. Or, to put it another way, back during the farm-to-factory migration, output was geared to the masses, which is to say, aggregate demand kept expanding. Today, FIRE doesn't create demand for anywhere near the displaced workers, much less new ones.

Have a nice day.

22 June 2017

Cruz Missile

Heard the Tedster on cable saying that the best part of the Senate ACA replacement was the allowance for NotInsurance plans that were outlawed by the ACA. Which caused the Right Wingnuts to decry the killing "choice". As if permitting insurance companies to scam the unwitting into paying for NotInsurance is a good thing.

The results of NotInsurance are easily seen:
1) those with it will end up in emergency rooms since nothing of note will be covered, and on the dole of the rest of us
2) siphoning those from even minimal real plans also siphons off real premiums, thus rising the premiums for the rest of us

Right Wingnuts, never saying so of course, want health insurance to be treated as just another consumer spend. Which it isn't. It's insurance, and thus only works if all are in the pool. Some degree of penalty for those who actively undermine the process is reasonable. But making such folks pay full price just turns insurance into another consumer spend. Which it isn't.

21 June 2017

Right, But For the Wrong Reason

Yet another story on the vampire loans, ARM. They've come back from the dead. What's interesting about the story is that it gets the reason for using ARM (from the house buyer's perspective, of course) completely wrong.

The folks who are the best for ARM are the Yuppy. Or, for that matter, anyone with strong expectations of rising income, especially above the expected inflation rate. If you're setting out to flip the house, as was the come-on which led to the Great Recession, then we'll just have another one. Those with rising incomes can chose to either flip or stay when the interest rate ratchets; everyone else has to sell, no matter what. We do all remember that was the proximate cause of the Crash. Don't we???? That CBS News would allow such a knucklehead to write such drivel is disturbing.
According to a study by the Federal Reserve, ARMs are a play on rising interest rates. When rates are low, as they have been for many years, homebuyers prefer a fixed-rate 30-year mortgage. But the Fed is gradually raising interest rates due to an improving U.S. economy.
[my emphasis]

Of course, this is nonsense. What matters in capital purchases, specifically consumer ones, is the monthly nut. Keep the nut (monthly mortgage plus fees) to some mythic percent, say 25% of gross income. Only those with rising incomes can withstand mortgage payment resets. Non-earned equity in that bungalow happens when the market value of the bungalow rises above the remaining mortgage value. Simple arithmetic. Just what the marginal flipper is expecting; a few years in a McMansion, then sell it out. Same as 2005. Some other simple arithmetic: what happens to capital values when interest rates rise? Class???? They fall, to match the implied return, which has gone up. What happens to house values as interest rates rise? Class??? They fall so as to keep the nut stable. So, what happens when ARM mortgages, held by those on stagnant or falling wages, rise? They all have to sell or be foreclosed. We've really have seen this movie before. Gad. So, for the house buyer, ARM in a time of rising rates is the absolutely worst time to sign on the dotted line. Except for the truly upwardly mobile. Given that the middle class is in rapid decline, what's the answer? Class???

18 June 2017

I Still Hate Neil Irwin, part the seventh

Yes, I still do. He "steals" my PINO meme with his piece today. Admittedly, he gets quotes, but hey; he's a highly paid reporter for the NYT, so he should. The lede:
The thing about populism is it usually involves doing things that are popular.

This is something that European nationalists and Latin American strongmen have long known. When they come to power, they aim to deliver concrete benefits to their supporters, even at the cost of their nations' long-term fiscal health.

What he does miss is that old bugaboo, the multiple sources of inflation:
The government would pay for it all with higher deficits. Free candy for everyone! The cost -- in the form of higher interest rates and perhaps inflation -- would come later.

Of course, only if the billionaires aren't required to pull some freight. Recall an earlier missive which showed that income tax started as a rich man's tax: they paid seven times as much as the lowest tier, and that tier was much above median.

Even if Donald J. Quisling did go about doing anything, it'd be based on shovelling money to the Billionaire Boys' Club. Real fiscal policy? Not until Hell freezes over.

He offers up quotes from a tome on Latin American populism, which tome concludes that wealth equalization (the only cogent point of populism, of course) must needs lead to catastrophe through the currency. However, comparing Latin American mini-economies (and their dependent currencies) to the USofA is silly. The US Buck is New Gold, mentioned in these missives many times, and, among other things, the USofA is thus obligated to spread its Bucks around the globe to keep the world's economy running. And, of course, since the US Buck is New Gold, we still get to say how much it's worth. Latin American tin horn dictators never could make such a claim for their paper money.
the populist movements of Latin America had often generated a disastrous boom-bust cycle

Shown here, in graphic detail more than once, is the depression laden 19th century USofA economy: even with a currency in specie (actually, because of it), economic life is mostly bad for most folks. We're supposed to be smarter than lower forms of life. There's something to be said for that scene in "2001" where the hominids break bones by the monolith. Monolith, gold, monolith, gold... Supportive fiscal policy isn't, by design, disastrous. If it were, we would still be in our Post-WWII Depression.

Gifts for the BBC:
Despite the president's talk of a bold $1 trillion infrastructure plan, there is not yet an actual legislative proposal, and the approach the administration has described relies heavily on tax credits to encourage private investment. That tends to limit the scope of any projects to those that can generate revenue to pay off investors.

13 June 2017

About That Duck

So, it looks like a duck, walks like a duck, and quacks like a duck. What is it? It's a Kim Jong-Don. Some readers took exception to that extreme epithet. Today's news that he's on the verge of firing Mueller, and that Dear Leader cabinet meeting yesterday was enough proof.

Fair's Fare

Mulvaney justified cutting the social safety net, and the scientific one too, by describing this budget as "taxpayer friendly". Clearly, a swipe at Romney's 47% diatribe.

Well, here's some factoids. The current income tax is the result of the 16th amendment. The first tax levels
Later that year, Congress enacted the Revenue Act of 1913. The tax ranged from 1% on income exceeding $3,000 to 7% on incomes exceeding $500,000.

Now, that's really progressive: 7 times higher for the rich. Moreover, the median income (to the nearest available year) was
According to a U.S. News and World Reports article comparing income in 1915 and 2015, "back in 1915 . . . you were doing about average if you were making $687 a year, according to the Census. That is, if you were a man. If you were a woman, cut that number by about half."

So, income tax didn't kick in until well above the 50th percentile. Way, way above. And that assumes the original used "average" as median rather than mean. Unlikely, so the median wage was almost certainly even less.

Any way you cut it, the 47% have been with us since the beginning of income taxation.