I'm a big fan of social democracy myself, but "life-time" employment is a result of really restrictive labor laws (It takes legal review to fire permanent employees in France), and these generate high structural unemployment. Even during the boom times when the US had an unemployment rate of 4%, France had one of 9%, and an unemployment rate among young people hovering around 50%.
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Basically, because it's impossible to fire people, companies almost never hire full-time employees, and this creates a two-track system where the well-connected enjoy cushy jobs for life, while the poor are shunted to shitty temp jobs. This is not a good thing.
Fundamentally, we need a labor force that adjusts as the economy changes, and so we need workers to switch companies and move around frequently. But I believe it's the responsibility of government to citizens cope with the instability this causes. The way around this is with a generous social safety net and universal health care, so that workers do not suddenly lose everything when they get laid off. In the Netherlands, this is combined with a serious job's retraining program and free university for all, and the end result is a higher median wage then the United States, some of the lowest unemployment in the world, and robust growth. Even without life-time employment, this sounds pretty good, no?
Birth-rates decrease as living standards go up, which is why Japan and most of Europe are below replacement level. Latest estimate is that the world stabilizes at 9-10 billion.
I just can't see the motivation for living underwater, outside of a couple of tiny niches like deep-sea mining or off-shore oil drilling. The latest estimates are that world population will level off fairly soon, and there really is no shortage of land. Even for eccentrics who want to live in isolation near the water, it would probably be cheaper and logistically easier to build a cottage somewhere on the coast line far away from the city.
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Some people have brought up sea-steading or escaping tyrannical governments, but wouldn't a cruise ships fill that role more effectively at a fraction of the cost? (That's assuming the thinking of the movement is sound. The French are not exactly tyrants, but they had no problem bombing that green-peace vessel in the 80's. If you're rich enough to live in an underwater city, you're probably better off buying your way into to a nice Western Country...)
Maybe I'm missing something. Feel free to fill me in.
If you want to be pedantic about it, you missed the part where French is, roughly speaking, the end result of a bunch of Germans trying to speak Latin. And how the Normans ruled england for a while. And how, for a huge period of time, the ruling classes all over Europe spoke Latin or French exclusively. It's just absurd to bring up Proto-Indo-European to make it sound like French is as close to English as Hindi.
But, if you want to be technical about it, the correct thing to say is that English is closest related, chronologically, to Frisian, which is kind of like dutch/german.
Just looking on a word basis, we have more words with Germanic roots then French/Latin ones. But grammatically, it's a bit of a wash. We lack German's complex case system, it's weird definite article system(30 definite articles!), and the whole agglutinative word thing. With French, the only real difference with English is the masculine/feminine and vous/tu distinction, both of which also exist in German. But that's just a hunch, I don't know how I could quantify that sort of thing(I'd love to hear your input).
This is true. Also, a scary number of English idioms exist verbatum in French too. ("The grass is always greener on the other side --> "l'herbe est toujours plus verte ailleurs."). This is because a) Our language is descended from theirs, and b) We tirelessly work to steal phrases from each other.
Did you read the god-damn article? The results are insanely non-uniform. With a sample-size of 10,000 , IE ends up in 5th place 50% of the time. I mean, it's not evil, it doesn't benefit them. But it makes them look insanely dumb.
Yeah, it'd be interesting to see if people can distinguish stock data from something from a full stop CAPM-like model with all the modern bells and whistles put in.
"What always struck me as odd about the "random walk" conjecture is that it seems that if stock prices were random walking they should in the short term follow some sort of normal distribution. "
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In the short term, stocks *do* move around following some sort of normal distribution (Not really normal, but fatten the tails a bit and you're good). Take a look the daily returns histogram at http://www.wolframalpha.com/input/?i=IBM .
" Some traders like to use bollinger bands, which place standard deviation lines above and below a moving average. That always seemed silly to me, since it is well known that stock prices are not even close to following a gaussian distribution."
Even if the distribution isn't normal, standard deviations are still useful. http://en.wikipedia.org/wiki/Chebyshev's_inequality is the simplest theorem, but there are more complicated ones like the Petunin inequality that give better bounds. The basic rule is as long as your distribution isn't too weird, the 2-3 75-99 rule works pretty well...
"Furthermore, the whole idea seems to lose sight of the fact that these aren't numbers coming out of the ether, they are being produced by a large number of people, each behaving in different, but somewhat predictable ways. That makes for a very complex system sure, but not a random one."
Eh, pseudo-random number generators are produced by a large number of circuits, behaving in different but almost perfectly predictable ways. That complex systems sometimes act indistinguishably from random ones is a neat result of ergodic theory...
You're mangling things a bit. Here is a cleaned up version of what you were trying to say:
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Initially, it was believed that asset prices followed a log-normal random walk. That is to say, if Y(t) is equal to price on day t, that Log(Y(t))=Log(Y(t-1))+e(t), where e(t) is a normally distributed error term.
Very quickly, people realized that this wasn't true, and that rare events happened more much often then the previous model predicted. Instead, many academics and investors found that using a model where the error term followed a distribution with heavier tails was more accurate. Usually, something like an Alpha-Stable distribution. (I'm ignoring stuff like stochastic volatility and drift...)
Unfortunately, the math on the initial model is much easier to deal with, because normal distributions have a lot of great properties, and so many people on wall-street used the initial model instead of the more complicated but accurate one. This caused problems.
But model is no more or less "random" then the other.
But chaotic systems are generally predictable short term... while markets aren't (otherwise everyone would make a ton of money trading within seconds of observations).
In general, there are a ton of people who make a ton of money trading within seconds of observations. You hear hedge fund managers say things like "There's not anywhere near enough capital in the world to soak up all the arbitrage out there". There are all sorts of short-run patterns like momentum that are still out there, despite plenty of studies pointing them out. I actually worked in this sort of thing specifically in an internship last year, but I signed an NDA, so that's probably all I can say about that.
Less controversially, if you want to predict stock prices 3 minutes from now, current prices would do a pretty good job. There are even well developed public models that will give you a good idea of the error bound!
But in terms of this whole debate, I'd say stock prices are random. Not uniform, but models that look at asset prices as log-normal random walks do pretty well. The ones that use heavier tails and stochastic variance and all do even better. One can model chaotic systems with probabilistic tools pretty well too though, so I think the distinction is a bit pointless.
It's not about "saving the eath maaaaan", climate change has a significant chance of killing millions and shunting hundreds of millions more into dire poverty. In Bangledesh alone, over 40 million people are set to be displaced from their homes in the coming decades because of rising sea levels.
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It's one thing if you're willing to dispute those findings after careful consideration and research. But if you unwilling to devote more thought to the issue then anti-consumerist bullshit, because you don't care...I have no kind words...
Uncertainty works in favor of climate action. Even if there's a 1% chance of the world warming by more then 6 degrees, then from an expected value point of view, the cost of reducing CO2 emissions would be far lower then the cost of dealing with it later.
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Due to rather basic physics, we know that global warming is almost certainly not going to make the earth's temperature decrease, so if you argue that there is uncertainty, that just raises the probability of catostrophic global warming, strengthening the case for drastic action. It's really rather basic probability theory (95% confidence intervals grow wider with increases in variance...).
The "denier" point of view only makes sense if one is very very sure that temperatures are not going to rise. Oddly, deniers don't make these arguments much...
That's actually the controversy. Greenhouse effect from CO2 raises temperature which causes water to evaporate. The water vapor forms clouds which affect albedo. Clouds are white, so more sunlight is reflected back to space, lowering temperature. The whole water vapor thing is the main negative feedback.
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The extent to which the second effect counteracts the first one depends on things like ocean currents, and that's where the need for complicated climate models begin to come in. But other then vapor, pretty much every other feedback effect is positive (Heat causes permafrost to melt, causing for CO2 to be released into the atmosphere. That sort of thing).
That's a little elitist, no? Youtube has millions of videos: Opera, lectures in higher math, talks by nobel-winning lauriates, speeches by politicians...Hell, there are songs about graduate mathematics! If you can't find anything of intellectual interest on Youtube...it's because you're boring and closed minded, not because you're smart.
Eh, I live on spreadsheets because I do an enormous amount of data analysis. (Obviously, I use real stat packages like R for real work, but spreadsheet software is pretty good for exploration). And having spent a lot of time with the OpenOffice suite when I was stuck on a linux box last semester...I can say that while it's workable, it's definitely inferior to excel. OpenOffice seems to have a much harder time computing complicated recursive formulas, and is just unbearably slow and unworkable when it comes to making even simple graphs.
It seems fine for word-processing, though I used AbiWord and Gmail when I used linux, so my experience for that is a couple years old. I remember my main gripe being that spell and grammar check was sub-par compared to Word. Has that been fixed?
" Do we (society) really benefit from government run schools?"
Yes. Or at the very least, we benefit from government funding of education. There are a couple countries in Europe that use something like school vouchers that do ok, so I'm not too wedded to the idea of actual government-run schools. But I think it's patently obvious that widescale public investment in education has been a good thing. And if you disagree, the burden is on you to explain why every developed country in the last 60 years has acted against it's best interests...
"I would much rather the money be channelled based on the hopes and dreams of the individual taxpayers via the open market than some policy based on the political equation of the group in power at the time."
Eh, the research is pretty unequivocal that elections are driven almost entirely by economic fundamentals(See stuff like the douglas-hibbs model), so really, a system where politicians act to maximise votes works out pretty well. Not perfectly, you still get stuff like farm subsidies, but pretty well. The track-record for perfectly free market stuff is...Somalia
They were able to pay back their loans because their borrowing costs were so low, because the US had implicitly guaranteed their debt(The market knew that the government would bail Goldman out if they failed). Goldman might have paid back all their money, but Goldman paid it back with profits they made because they were able to borrow money at treasury rates either directly from investors because of the guarantee, or from a variety of Fed-vehicles. Basically, Goldman and the others have taken riskier bets then ever before after the crisis, knowing that if they don't pay off, the government will bail them out, and this has led them to make record profits.
This isn't to say that it's a bad thing that we bail out To-Big-To-Fail banks, I think everyone with basic market knowledge wishes we spent a couple billion on bailing out Lehman instead of the 700 billion we needed to draw from the TARP and the countless more from the stimulus and Fed programs. As for people saying that we shouldn't have even done that - Remember: 1 point of unemployment costs the federal government 200 billion in revenue. So there is a strong case for stuff like bailing out banks and stimulus packages even on narrow fiscal terms.
Still, if we're going to have banks that are too-big-to-fail, they should pay for the privilege. The Obama administration just proposed imposing a borrowing cost on large banks to counter-act the unfair advantage they get from their implicit government guarantee. Unfortunately, the tax is only about a fifth as large as independent experts estimate it would need to be to counter-act the moral hazard, but that's what you get when you have a financial industry that owns a quarter of the democrats and a republican party that votes No on absolutely everything.
"A better discussion is that protectionism harms the economy. Try it some tyme. Look up the Smoot-Hawley Tariff Act of 1930 [wikipedia.org] and what it did. Because the US passed a protectionist law other nations did the same in retaliation. Some economists, though not all, blame protectionism on causing the Great Depression [state.gov]."
Right, because setting tarrifs to 1000% is a bad idea, the optimal tarrif rate must be 0...
While there are easy to calculate economic distortions caused by tarrifs that are taught in Econ 101, the story is a little more complicated. The buisness cycle poses much larger economic costs, and sometimes tarrifs can be used to help manage the buisness cycle. The quip is that it takes a lot of Harberger triangles to fill an Okun gap. See a good write-up of that at http://krugman.blogs.nytimes.com/2009/02/01/protectionism-and-stimulus-wonkish/?pagemode=print .
More specifically, tarrifs are out of style, but taking actions to keep a currency undervalued is equivalent, and that is very popular precisely because it is effective. It's been the preferred development strategy of China, Brazil, India, and others...
The financial system was non-functional when the loan was signed. Nobody was able to get a loan for anything, since investors were throwing all their money into treasury bonds(Whose yields actually became negative at some point, that is to say, the investors were paying the government to take their money). That is, by itself, a pretty good reason why this wasn't done with private dollars.
More generally though, gasoline powered cars generate significant externalities due to carbon emissions and because oil money directly pay for stuff like Russia's fighter jets and Al-Qaeda cells that cost our government a lot of money to counter. It's not fair that I have to pay higher taxes to cover military spending because somebody else bought a Hummer. And it's even less fair that millions of people in Bangladesh have to die so that people can enjoy cheap gasoline.
Because of this, something like a carbon tax or Cap and Trade scheme, as well as higher gasoline taxes, are necessary to internalize costs that heavy drivers are currently shifting to society. But since that isn't politically feasible due to the filibuster, selective government investments in green technologies are a second-best solution.
Governments carry much lower borrowing costs the individual investors ever could, and so if there is an investment that should be made by a society, it makes sense for a government to do it. Governments don't always have very efficient decision making structures, so there are limits to how much this should be taken advantage of, but there is nothing wrong with government investment in general. Despite what libertarians often assume, there is no evidence that Industrial Policy is bad for the economy. On the contrary, the experiance of South Korea, Japan, and China, along with the rapid growth of post-war America and Europe, suggest exactly the opposite.
As for this particular bit of spending: At the time was given, the financial system was utterly dysfunctional, and investors refused to put their money in anything but treasury bonds(Which actually turned negative at some point, that is to say, investors paid the government to take their money).
Faced with this, the government really had no other option then to step in and do lending for the financial system, using the money that the financial system gave them.
Electric cars don't idle, and get energy from regenerative breaking, so the effect you're talking about is much smaller for electric cars or hyrbids then conventional ones.
Slashdot Mirror
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Basically, because it's impossible to fire people, companies almost never hire full-time employees, and this creates a two-track system where the well-connected enjoy cushy jobs for life, while the poor are shunted to shitty temp jobs. This is not a good thing.
Fundamentally, we need a labor force that adjusts as the economy changes, and so we need workers to switch companies and move around frequently. But I believe it's the responsibility of government to citizens cope with the instability this causes. The way around this is with a generous social safety net and universal health care, so that workers do not suddenly lose everything when they get laid off. In the Netherlands, this is combined with a serious job's retraining program and free university for all, and the end result is a higher median wage then the United States, some of the lowest unemployment in the world, and robust growth. Even without life-time employment, this sounds pretty good, no?
Birth-rates decrease as living standards go up, which is why Japan and most of Europe are below replacement level. Latest estimate is that the world stabilizes at 9-10 billion.
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Some people have brought up sea-steading or escaping tyrannical governments, but wouldn't a cruise ships fill that role more effectively at a fraction of the cost? (That's assuming the thinking of the movement is sound. The French are not exactly tyrants, but they had no problem bombing that green-peace vessel in the 80's. If you're rich enough to live in an underwater city, you're probably better off buying your way into to a nice Western Country...)
Maybe I'm missing something. Feel free to fill me in.
But, if you want to be technical about it, the correct thing to say is that English is closest related, chronologically, to Frisian, which is kind of like dutch/german.
Just looking on a word basis, we have more words with Germanic roots then French/Latin ones. But grammatically, it's a bit of a wash. We lack German's complex case system, it's weird definite article system(30 definite articles!), and the whole agglutinative word thing. With French, the only real difference with English is the masculine/feminine and vous/tu distinction, both of which also exist in German. But that's just a hunch, I don't know how I could quantify that sort of thing(I'd love to hear your input).
This is true. Also, a scary number of English idioms exist verbatum in French too. ("The grass is always greener on the other side --> "l'herbe est toujours plus verte ailleurs."). This is because a) Our language is descended from theirs, and b) We tirelessly work to steal phrases from each other.
Did you read the god-damn article? The results are insanely non-uniform. With a sample-size of 10,000 , IE ends up in 5th place 50% of the time. I mean, it's not evil, it doesn't benefit them. But it makes them look insanely dumb.
Yeah, it'd be interesting to see if people can distinguish stock data from something from a full stop CAPM-like model with all the modern bells and whistles put in.
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In the short term, stocks *do* move around following some sort of normal distribution (Not really normal, but fatten the tails a bit and you're good). Take a look the daily returns histogram at http://www.wolframalpha.com/input/?i=IBM .
" Some traders like to use bollinger bands, which place standard deviation lines above and below a moving average. That always seemed silly to me, since it is well known that stock prices are not even close to following a gaussian distribution."
Even if the distribution isn't normal, standard deviations are still useful. http://en.wikipedia.org/wiki/Chebyshev's_inequality is the simplest theorem, but there are more complicated ones like the Petunin inequality that give better bounds. The basic rule is as long as your distribution isn't too weird, the 2-3 75-99 rule works pretty well...
"Furthermore, the whole idea seems to lose sight of the fact that these aren't numbers coming out of the ether, they are being produced by a large number of people, each behaving in different, but somewhat predictable ways. That makes for a very complex system sure, but not a random one."
Eh, pseudo-random number generators are produced by a large number of circuits, behaving in different but almost perfectly predictable ways. That complex systems sometimes act indistinguishably from random ones is a neat result of ergodic theory...
Initially, it was believed that asset prices followed a log-normal random walk. That is to say, if Y(t) is equal to price on day t, that Log(Y(t))=Log(Y(t-1))+e(t), where e(t) is a normally distributed error term.
Very quickly, people realized that this wasn't true, and that rare events happened more much often then the previous model predicted. Instead, many academics and investors found that using a model where the error term followed a distribution with heavier tails was more accurate. Usually, something like an Alpha-Stable distribution. (I'm ignoring stuff like stochastic volatility and drift...)
Unfortunately, the math on the initial model is much easier to deal with, because normal distributions have a lot of great properties, and so many people on wall-street used the initial model instead of the more complicated but accurate one. This caused problems.
But model is no more or less "random" then the other.
But chaotic systems are generally predictable short term... while markets aren't (otherwise everyone would make a ton of money trading within seconds of observations).
In general, there are a ton of people who make a ton of money trading within seconds of observations. You hear hedge fund managers say things like "There's not anywhere near enough capital in the world to soak up all the arbitrage out there". There are all sorts of short-run patterns like momentum that are still out there, despite plenty of studies pointing them out. I actually worked in this sort of thing specifically in an internship last year, but I signed an NDA, so that's probably all I can say about that.
Less controversially, if you want to predict stock prices 3 minutes from now, current prices would do a pretty good job. There are even well developed public models that will give you a good idea of the error bound!
But in terms of this whole debate, I'd say stock prices are random. Not uniform, but models that look at asset prices as log-normal random walks do pretty well. The ones that use heavier tails and stochastic variance and all do even better. One can model chaotic systems with probabilistic tools pretty well too though, so I think the distinction is a bit pointless.
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It's one thing if you're willing to dispute those findings after careful consideration and research. But if you unwilling to devote more thought to the issue then anti-consumerist bullshit, because you don't care...I have no kind words...
Already on the drawing board - http://yglesias.thinkprogress.org/archives/2009/08/chamber-of-commerce-wants-to-put-evolution-on-trial.php
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Due to rather basic physics, we know that global warming is almost certainly not going to make the earth's temperature decrease, so if you argue that there is uncertainty, that just raises the probability of catostrophic global warming, strengthening the case for drastic action. It's really rather basic probability theory (95% confidence intervals grow wider with increases in variance...).
The "denier" point of view only makes sense if one is very very sure that temperatures are not going to rise. Oddly, deniers don't make these arguments much...
http://www.stat.columbia.edu/~cook/movabletype/archives/2009/12/say_a_little_pr.html is a great article on this.
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The extent to which the second effect counteracts the first one depends on things like ocean currents, and that's where the need for complicated climate models begin to come in. But other then vapor, pretty much every other feedback effect is positive (Heat causes permafrost to melt, causing for CO2 to be released into the atmosphere. That sort of thing).
http://www.stat.columbia.edu/~cook/MT/mt-search.fcgi?blog_id=1&tag=global%20warming&limit=20 is a really great introduction to the details of everything.
That's a little elitist, no? Youtube has millions of videos: Opera, lectures in higher math, talks by nobel-winning lauriates, speeches by politicians...Hell, there are songs about graduate mathematics! If you can't find anything of intellectual interest on Youtube...it's because you're boring and closed minded, not because you're smart.
It seems fine for word-processing, though I used AbiWord and Gmail when I used linux, so my experience for that is a couple years old. I remember my main gripe being that spell and grammar check was sub-par compared to Word. Has that been fixed?
Government subsidies took the form of massive purchases and research of cars during WW1...
Yes. Or at the very least, we benefit from government funding of education. There are a couple countries in Europe that use something like school vouchers that do ok, so I'm not too wedded to the idea of actual government-run schools. But I think it's patently obvious that widescale public investment in education has been a good thing. And if you disagree, the burden is on you to explain why every developed country in the last 60 years has acted against it's best interests...
"I would much rather the money be channelled based on the hopes and dreams of the individual taxpayers via the open market than some policy based on the political equation of the group in power at the time."
Eh, the research is pretty unequivocal that elections are driven almost entirely by economic fundamentals(See stuff like the douglas-hibbs model), so really, a system where politicians act to maximise votes works out pretty well. Not perfectly, you still get stuff like farm subsidies, but pretty well. The track-record for perfectly free market stuff is...Somalia
This isn't to say that it's a bad thing that we bail out To-Big-To-Fail banks, I think everyone with basic market knowledge wishes we spent a couple billion on bailing out Lehman instead of the 700 billion we needed to draw from the TARP and the countless more from the stimulus and Fed programs. As for people saying that we shouldn't have even done that - Remember: 1 point of unemployment costs the federal government 200 billion in revenue. So there is a strong case for stuff like bailing out banks and stimulus packages even on narrow fiscal terms.
Still, if we're going to have banks that are too-big-to-fail, they should pay for the privilege. The Obama administration just proposed imposing a borrowing cost on large banks to counter-act the unfair advantage they get from their implicit government guarantee. Unfortunately, the tax is only about a fifth as large as independent experts estimate it would need to be to counter-act the moral hazard, but that's what you get when you have a financial industry that owns a quarter of the democrats and a republican party that votes No on absolutely everything.
Eh, I don't know the specifics of the company, but I'm going to bet that venture capital dried up because the financial sector collapsed...
By building on the research and experience of 50 years of automobiles before him... We're not at the point where something like Ford is possible.
Right, because setting tarrifs to 1000% is a bad idea, the optimal tarrif rate must be 0...
While there are easy to calculate economic distortions caused by tarrifs that are taught in Econ 101, the story is a little more complicated. The buisness cycle poses much larger economic costs, and sometimes tarrifs can be used to help manage the buisness cycle. The quip is that it takes a lot of Harberger triangles to fill an Okun gap. See a good write-up of that at http://krugman.blogs.nytimes.com/2009/02/01/protectionism-and-stimulus-wonkish/?pagemode=print .
More specifically, tarrifs are out of style, but taking actions to keep a currency undervalued is equivalent, and that is very popular precisely because it is effective. It's been the preferred development strategy of China, Brazil, India, and others...
More generally though, gasoline powered cars generate significant externalities due to carbon emissions and because oil money directly pay for stuff like Russia's fighter jets and Al-Qaeda cells that cost our government a lot of money to counter. It's not fair that I have to pay higher taxes to cover military spending because somebody else bought a Hummer. And it's even less fair that millions of people in Bangladesh have to die so that people can enjoy cheap gasoline.
Because of this, something like a carbon tax or Cap and Trade scheme, as well as higher gasoline taxes, are necessary to internalize costs that heavy drivers are currently shifting to society. But since that isn't politically feasible due to the filibuster, selective government investments in green technologies are a second-best solution.
As for this particular bit of spending: At the time was given, the financial system was utterly dysfunctional, and investors refused to put their money in anything but treasury bonds(Which actually turned negative at some point, that is to say, investors paid the government to take their money).
Faced with this, the government really had no other option then to step in and do lending for the financial system, using the money that the financial system gave them.
Electric cars don't idle, and get energy from regenerative breaking, so the effect you're talking about is much smaller for electric cars or hyrbids then conventional ones.