Saturday, July 31, 2010

Cultural Signpost of the Day

My friend Ignota has three separate doctors here in Palookaville--a neurologist, a rheumatologist and an endocrinologist.   They're all named Dr.Singh.

Afterthought: Time to recycle the old joke?
--Hello, Shapiro, Shapiro, Shapiro and Shapiro, how may I direct your call?
--Ah, yes, is Shapiro there?
--No, he's on vacation this week.
--Well, is Shapiro there?
--No, he called in sick.
--Right.  How about Shapiro?
--This is his golf day.
--Well then,let  me talk to Shapiro.
 Another Afterthought: Back in the Pleistocene, the Louisville Yellow Pages (!), under "Attorneys" included three entries for "Leibson"--rather, one for Leibson, Leibson and Leibson; one for Leibson and Leibson; and one for Leibson.

Appreciation: Bell on Total War

David A. Bell's The First Total War is a pretty good book on the relationship of war and imagination--or rather, two, maybe three, books, although it is not clear that the author himself has quite sorted them out.

The subject is the French Revolution and the rise of Napoleon.  Perhaps the best and certainly the portion most central to the author's apparent thesis is his account of the delusional arrogance of the first generation of revolutionary leaders, who blundered into a kind of war the world hadn't seen before, to the cost of many including, in large measure, themselves.   Bell frames his presentation with an informed account of pre-revolutionary warfare: a game not so much for professionals but for aristocratic dabblers.  Plenty of people were killed or maimed in pre-revolutionary warfare, plenty of lives broken.  But warfare was still a desultory affair, for almost everyone a kind of part-time job. How different, then from the levée en masse of the early revolutionary era, where the logic of warfare became the logic of all against all.  Bell is particularly good on how the revolutionary leadership besotted itself with the example of the ancients, particularly the Roman Republic a world which (like warfare itself) they seem scarcely to have understood.

Allen moves on to an instructive if not particularly original, account of the career of Napoleon (but then, how could one hope to be original in telling the story of a figure as much studied, almost, as Lincoln or Jesus Christ?).   Although Bell isn't writing specifically military history, he does suggest the ways in which Napoleon assimilated the lessons of the new age.  But the perhaps the more relevant story is the account of Napoleon's unparalleled skill as a novelist of his own life--evidently he considered becoming a writer, back when it looked like his military career was going nowhere.  Again, Bell is not the first to notice (Andy Martin's instructive Napoleon the Novelist is in Bell's bibliography).  But he does a superb job of showing how Napoleon's self-imaging worked so well to carry him through the first phase of his career.  Indeed, informed by this background, we may say that Napoleon's problem after 1800 was that he couldn't figure out how to carry the story forward.  He couldn't justify his continued presence except in the event of continued warfare which became ever more costly and hazardous.  And by corollary, he was never able to sell himself to his "brother emperors" as a dues-paying member of the club--hence his humiliating exile--an imprisonment, really--to St.Helena after Waterloo.

But there is perhaps a third book tucked away early on, before Napoleon and before the revolutionary excess of the first warlike phase.  That is the account of the revolutionary debates in the immediate aftermath of 1789 as they try to figure out who they are, who the King is, what kind of "nation" they have become.  If it is not the role of the king to declare war, then what is a king for?  But if it is his role, why are we here?  The revolutionaries were still puzzling over that one when the King bolted and sought to escape the country, simplifying the choice for everybody.  I don't suppose it would much comfort him to know that he helped to write a critical chapter in the modern history of sovereignty.

Friday, July 30, 2010

For Your Surplus Men File: 1827

We then spoke of the Two Foscari, and I remarked that Byron drew excellent women.

"His women," said Goethe, "are good.  Indeed, this is the only vase into which we moderns can pour our identity; nothing can be done with the men.  Homer has got all beforehand in Achilles and Ulysses, the bravest and most prudent."
Johann Wolfgang von Goethe, Conversations with Eckermann 171 (North Point Press ed. 1984)

Vincent, to Theo

...the truth is, we can only make our pictures speak.  But still, my dear brother, there is this that I have always told you, and I repeat it once more with all the earnestness that can be imparted by an effort of a mind diligently fixed on trying to do as well as one can--I tell you again that I shall always consider that you are something other than a simple dealer in Corot, that through my mediation you have your part in the actual production of some canvases, which even in the cataclysm retain their quietude.

For this is what we have got to, and this is all or at least the chief thing that I can tell you at a moment of comparative crisis.  At a moment when things are very strained between dealers in pictures by dead artists, and living artists.

Well, my own work, I am risking my life for it and my reason has half-foundered owing to it--that's all right--but you are not among the dealers in men so far as I know, and you can choose your side, I think, acting with true humanity, but what's the use?
That's Vincent Van Gogh, to his brother Theo (who was also his dealer).  Vincent was buried this day in 1890 in a small cemetery in Auvers in the south of France.*  Vincent had died the day before, a suicide.  The quotation above is the text of a letter found in his pocket after he shot himself.
*Looks like my knowledge of Van Gogh is pretty superficial.  Auvers is "a commune in the northwestern suburbs of Paris."

Modified Rapture

From the bottom of the inbox.  Whoopie pies:
  • are more cake-like than cookie, and nothing like a pie;
  • differ from gobs in that gobs are filled with butter cream, while whoopie pies are filled with marshmallow;
  •  differ from moon pies in that moon pies are covered with chocolate.
See generally link; and cf. link, passim.  I couldn't find any whoopie pie songs, but there's this:

Thursday, July 29, 2010

Oh Dear, I Thought I Had Enough to Worry About...

Everyone agrees that portion sizes in depictions of the Last Supper have grown. Not everyone agrees why.

Come to the Rock, the Rock Will Not Hide You...

If there is any catalog of recipes for public-relations disaster, I should think ripping off gold star mothers would occupy a prominent place.

Thanks, Ivan.  Oh, and the obscure headline: it's a Prudential joke.  Cf link.

Opera Note: Second Thoughts on the Met's Carmen

Mr. and Mrs. Buce  took a second look at the Met's HD Carmen last night (cf. link) and independently reached the same conclusion: the trouble is that it is too perfect. That is: everybody knows what they're supposed to do and they do almost everything right. It's great fun to listen to and to watch--you just want to nibble Elina Garanca from top to toe. But Carmen is not about perfection. It's about fate & danger & sex & anarchy and all those things that make us all suspect that the folks down south eat and drink better than we do and get laid more often. The best performances come charging a you with all their energy, plus the not-quite remote possibility that you might get your guts ripped open by a pointed horn. But for all her attention to detail, there is just nothing about Garanca to suggest that she is the bearer of a doomed passion. So also Teddy Tahu Rhodes: he certainly knows how to swivel his hips in those bullfighter trousers but there is just enough self-mockery in his performance to remind you that he is really a much nicer man than that. Also the choruses: there is some wonderful chorus material in Carmen but it needs to be done on the edge of recklessness; the children's chorus in particular should scare the daylights out of you.  Here they were polished, disciplined and, well, flat--not musically, but dramatically flat, and it hurt.

I'll make a couple of exceptions. One, as Micaëla, Barbara Frittoli brings off a tough job: she makes memorable a character whose very point is her non-memorability--the country girl with so few options that even her nitwit of a soldier looks like a promising possibility.

The nitwit in question would be Roberto Alagna as Don Jose, and here we disagreed a bit. Mrs. B. thought he lacked passion. He did, but I'm not sure Don Jose has a lot of passion. He's a not-very-bright, not-very-high-principled country boy who thinks with his equipment and doesn't really recognize trouble until it comes trampling on his neck.

On This Day

Born this day in 1878: Don Marquis, creator of Archie and Mehitabel:
do you think that i would change
my present freedom to range
for a castle or moated grange
wotthehell wotthehell
cage me and i d go frantic
my life is so romantic
capricious and corybantic
and i m toujours gai toujours gai
So Mehitabel the alley cat, descendant of Cleopatra. On which her amanuensis Archie the Cockroach observes:
boss sometimes i think
that our friend mehitabel
is a trifle too gay

It was Marquis who, while on the wagon, walked into a bar and said "I've conquered this goddam willpower of mine. Gimme a double Scotch."

[I tried to find video of the great Rosalie Sorrels doing her rendition of the courtship of Mehitabel by Percy ("these kittens dissolve the marriage!").   But it doesn't seem to be out there.]

Wednesday, July 28, 2010

School Funding

I just read another one of those screeds (to which I will not bother link) on what a vain hope it is that drives us to put money into poor schools with the purpose of making them better.  There is just enough truth in this one to keep it alive, but I never get over wondering: if money is such an awful thing, why do rich people want so much of it, and in particular, for their children?    Wouldn't it be an act of lovingkindness just to cut 'em off at the age of eight and let them sell newspapers or shine shoes like their Horatio Alger ancestors?  Oh, right--no newspapers, but you get my point.

Were We Both Wrong?

Alan Blinder and Mark Zandi seem to think they have come up with demonstrable evidence that the government's campaign against the recession did some good.  Does this mean that both Greg Mankiw and I were talking through our hats when we treated the matter as essentially undecidable? and Sale by Ambush

I think I've just been scammed by a website called  I noticed a couple of $19.95 charges from them on my credit card statement.  I went to look for a website and somewhat to my surprise, I found one.  I certainly didn't remember ordering any of their "services," if they have any so (at suicidal risk?) I sent them an email telling them to cancel me and refund my money. A couple of days later, to my stunned astonishment, I got an email saying that I had been canceled. No mention of a refund, of course.

I circulated a query among a few of my friends; I turned up one who said he thinks he'd been stuck by the same device. Meanwhile, a couple of others said they'd found similar unexpected/unknown charges on their AT&T accounts.

My guess is what I've got here is a "sale by ambush" scam. If I went to the effort of battering down all the cyberwalls here I would find out that why yes, once I did flic my finger on a key that authorized this kind of charge--even though none but the most paranoid and attentive would have noticed. They charge you until you tell them to stop and then they stop. The same strategy underlies the "get your credit card number" game--get the card number and charge small stuff to it until somebody notices.

I suppose there is a remote chance may be defaming a blameless enterprise with an unimpeachable record of consumer satisfaction and a medal for perfect attendance at Sunday School. On the other hand, I just googled / scam/ and came up with 11,600 hits (see supra).  A couple of them seem to be, telling us what a wonderful outfit they are.  I didn't read all  of the other 11,598.

Update:  Well, how 'bout that.  I now find a message saying they'll credit a refund.

Update II:  A desultory bit of blogging makes it clear I am way behind on this one. turns out to be part of an outfit called "Adaptive Marketing," a whole Gothic novel itself with chapters involving Frelix Salmon, Ben Stein and a blogger named Flaeur de Fraude.


Link.  Well, I wasn't  there.

Snort-coffee-through-the-nose Moment of the Morning

“You know, our system, the system of the Interior Ministry, is very transparent,” he said.
Link.   That would be Deputy Chief Vladimir Grebenyuk of the police force in Novorossiysk, Russia, commenting on an inquiry into assertions by an officer in the department that there is endemic corruption among Russian police.   to inquiries “Not a single fact presented by [the officer] was confirmed,” Deputy Chief Grebenyuk said. “Everything he said was false and invented.”

Grebenyuk made no effort to explain how the Novorossiysk police chief can afford to live in a "spacious beachfront home" while he earns $25,000 a year.

Tuesday, July 27, 2010

The Professionalization of Friendship

There are 77,000 clinical psychologists in the US today. In the late 40s, there were 2,500. Now there are 50,000 "marriage and family therapists;" then, 500. Now, 192,000 "clinical social workers;" then, 30,000. Other categories like "mental health counselor" (105,000) "nurse psychotherapist" (17,000), and everybody's favorite, "life coach" (30,000) did not even exist.

I glean these figures via the Hoover Institution's Policy Review, from "The Rise of the Caring Industry," by Ronald W. Dworkin.* It's an interesting, suggestive piece, with the requisite references to honorable ancestors like Phillip Reiff and Christopher Lasch (although I note the absence of my own favorite antipsychiatrist, the gnarly old Thomas Szasz). Dworkin tries hard to individuate his own views. He stresses, for example, a conviction that we are not all a bunch of self-indulgent narcissists; that we are mostly ordinary people with ordinary kinds of loneliness, doing what we can to find a way out of the labyrinth.

Beyond that it seems to me Dworkin cannot sort out in his own mind the different roles of (a) the decline of the family; and (b) the rise of the (ahem) helping professions. I feel for him there although I think this nostalgia for an older, simpler way can be overdone. I grew up in an almost picture-postcard small town with a stable and attentive family and lots of non-axe-murderer neighbors. Yet I doubt that ever again have been quite so bored and lonely as I was before I got shed of that joint. I'd certainly agree that we need context and contacts but I suspect that one is as likely to find it on the fly--workmates, bartenders, superannuated racetrack greyhounds--as in any received and predetermined structure. Note "as likely," not "more likely;" human contact is, was and remains a tricky business and the idea that it might not always (or even "often") work is not just an artifact of the age of Craigslist.

What has fascinated me more over the years is the growth of what I referred to in the tagline as "the professionalization of friendship." I'm fascinated in two senses: one from the standpoint of the "patient," "client," customer or whatever you choose to call the "recipient" of care. And two, from the standpoint of the "professional." I'm surprised at the number of people who will pay good money for a commodity--advice--that almost anybody in the universe will give them in plenitude for free. And I'm even more impressed by the number of people who look like they aren't capable of getting their garage door open in the morning, yet who are willing to take money from others for telling the others how to run their lives.

This is no pose of Byronic indifference to the world. I cherish my friends, with some of whom I even seem to share some DNA. I cherish all unterrified listeners who will give me the gift (!) of their attention, their sympathetic detachment, sometimes even their flashes of insight. This sort of thing is invaluable but it is not easy come by. And that's the point: it is never easy come by, in the family, on the job, or down at Moe's Tavern; almost never (and then, by sheerest chance) do you get it dropped in your lap. You may get it from a licensed professional but my guess is that if so, it's more good luck than good planning; enjoy it while you can but don't be surprised if it doesn't work any better here than down at Moe's.
*Not that Ronald Dworkin, this Ronald Dworkin.

Why Not, Exactly?

Those people, she says, aren't "accustomed to hearing word 'orgasm' on the air, and three o'clock in the afternoon is not the best time to air this."
That's Barbara Lewis of Mississippi Public Broadcasting, explaining why (responding to complaints) she kicked "Fresh Air" over to 4 o'clock. Or is she merely obeying the ancient principle that 3 o'clock--am or pm--is not a good time to start anything?

Calamity Numbers Again

John showcases another of those collections of stats designed to remind us of how bad off we are (link). I've no doubt that these are mostly on the right track, but still it is always easy to flyspeck this kind of summary. For example, we are told that 61 percent "'always or usually' live from paycheck to paycheck."(link). This is said to be "up from 43 percent in 2007." I'll take these numbers at face value, but I wonder how much of my life my father and mother spent living paycheck to paycheck: I suspect the answer is--every hour of their adult life. And I'm sure they counted as "middle class," if marginally so.

But more puzzling: "36 percent of Americans say that they don't contribute anything to retirement savings." (link). Very well, but does this mean that 64 percent do contribute something to retirement? Sounds like a lot. And there's an arithmetic overlap with those living paycheck to paycheck. Are we counting retirement contributions as part of that "paycheck" scenario?

Or is the point that "A staggering 43 percent of Americans have less than $10,000 saved up for retirement." (link). Does that mean that almost half of those who are contributing to retirement savings are paying just pennies a week? Or (more likely, I suspect) that we've got some self-delusion at work here--that lots of people think they are contributing to retirement when in fact they are not?

By the way, that 36 percent who contribute nothing--I assume we are not talking about people who are already retired? Are we talking about people for whom retirement contributions have been made by others? People (all right, this is a stretch) who figure they have contributed enough?

In a different vein, I got a laugh out of: "For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together. "link. "Housing net worth," measured how, exactly? I wouldn't be surprised if the bank is carrying all this stuff at no less than the amount of the outstanding loan, which means the bankers are lying to themselves at least as much as they habitually lie to us. In any event, for "own," I would substitute "are stuck with." I'm sire the bank is no happier to have all this distress real estate than we would be.

Monday, July 26, 2010

Is it Me? Or Him?

I'm finding Nouriel Roubini's meltdown book (with Stephen Mihm) surprisingly slow going for someone whose work I admire so much. I acknowledge I've read a lot of this genre over the last year or so--probably a good deal more than I needed. So is he just repeating himself? Or am I just OD'ing? Or am I missing something?

Lynching Low and High

Jeffrey Lord is scandalized that Shirley Sherrod would describe the death of her relative as a "lynching" when in fact he was merely handcuffed, dragged and beaten to death. No rope, get it? Lynching requires a rope. Lloyd is clearly writing in the grand tradition memorialized by Justice Holmes' story of the defendant who was accused of stealing a churn. The Justice of the Peace released the defendant after he checked his law dictionary and found no entry for "churn."

By this standard Lord's reasoning is unassailable but the point needs nuance. Perhaps rope is required for a low-tech lynching. A "high-tech lynching" occurs when a a left-wing zealot asks a question of a Supreme Court nominee.

The Shadow Government

I've known Elizabeth Warren (not well) for something like 30 years now. Like almost everyone who ever met her, I've enjoyed her company: she's enthusiastic, energetic, warm-hearted and mostly on the side of the angels. And she has done me the occasional favor. I haven't weighed in on the great Warren Kerfuffle because I am too far out of the action to count. But I can't resist this insight from my good friend anon:
...she'll fit right with with Fed Chair Paul Krugman, Treasury Secretary Simon Johnson, and CEA chair Brad DeLong.
He forgot "counselor to the president Joseph Stiglitz." Hoo, ha, now there is a shadow government

[Anon also reports: I just don't see it happening, but then again I just didn't see the dissolution of the Soviet Union happening and thought Geithner was likely to be fired in early 09.]

Sunday, July 25, 2010

Bremmer on State Capitalism: Two Paradoxes

Ian Bremmer's The End of a Free Market is a superb quick read, built on two paradoxes.

First paradox: this is a book likely to be be read end enjoyed most by people who believe they already know everything in it. They will be wrong, of course: at the very least, Bremmer brings together into one place a range of gritty data about the diversity of strategies by which different countries play a role int he market. But aside from the detail, there is a core of half-truth to the insight that they've heard it before. That is: what Bremmer does here is to bring into focus or articulate a notion that has been floating around in the air there, waiting to be written.

The seeds took root around the collapse of the Soviet Empire beginning in 1989. It was Francis Fukayama who blew the whistle and rang the bell. Now that we have thrown off the shackles of communism, he argued, we can all advance together into (19th Century) free-market liberalism; we can all go to the seashore.

I often wonder how Francis Fukayama dares show his face in public any more because it is hard to think of any public pronouncement in recent years that has proven more crashingly, smashingly wrong.* But that is his affair; for the rest of us, the intervening 20-odd years have been a series of rude, sometimes brutal a reminders that the death of state socialism did not bring the death of state capitalism; quite the contrary it is the very decline of state socialism that has to facilitate the advance of its evil twin.

As with so many important ideas, in retrospect it should have been obvious. I mean, consider: in the long chronicle of human endeavor, the idea of "a free market state"--a state whose only job is to facilitate a free market--is one of the oddest, most non-inevitable, most counter-intuitive. Before Adam Smith, just about nobody thought of a state that way. Hardly surprising that so many don't get it yet.

Aside from crystallizing the hitherto non-obvious, I suspect that Bremmer's greatest contribution is his catalog of the number of different ways that a state can involve itself in economic activity. Of course it can simply "run everything"--an option which, happily, few or no states currently embrace. More conventionally, it can find itself the proprietor of a huge pool of hydrocarbons which it chooses to manage itself, thank you, rather than turning it over to ExxonMobile or Chevron (fun fact: "the fourteen largest state-owned energy companies control twenty times as much oil dna gas as the eight largest multinationals.")

But these are only the beginning, and I suspect the chief virtue of Bremmer's detail is the way it helps to stimulate concern over just what we mean when we talk about "government" activity in the "free market." Norway has a formidable sovereign wealth fund (H/T, North Sea Oil). Is this "okay" because Norway operates at a high standard of accountancy and transparency? Is it good or bad that the Norwegian fund refuses to invest in Wal-Mart?

Or consider India where the government, lacking the political will to privatize dinosaur state industries, has chosen instead to force these companies, though public, to operate more and more like their private competitors? Or the United States, which still runs a post office. Do we count this as "the government" engaging in "private" activity? Or is it merely the government providing an essential state service? And if we are going to privatize the post office, what about the police? Or perhaps better, since we already have privatized so much of the police, why bother hang onto a post office?

All of this is stimulating stuff, raising 100 questions that one might not have thought of without Bremmer's presentation. All of which leads me to my second paradox: Bremmer's book is perhaps best understood as the first-draft intro to another book which remains to be written. That second book would be: just how, exactly,do we distinguish between "proper" and "improper" state economic activity--particularly in an age of sovereign states. If the post office is not an essential economic activity, then how should we feel about China National Offshore Oil Corporation (CNOOC) and its thwarted takeover of Unocal (Bremmer calls Unocal "a U.S.-owned oil company." Really? Are we certain that most shares of Unocal are held by citizens of the United States? Does it matter?). Is there really any need for a "Committee on Foreign Investment in the United States"--or is any effort to control foreign investment simply the inappropriate interference of the state in the activities of the market?

I don't mean to impute to Bremmer the more absurd of these suggestions. For all I know he doesn't accept any of them, and he may even have good reasons for rejection of them. My point is that Bremmer on state capitalism points out as starkly as ever I've seen them some of the more destabilizing inconsistencies between the idea of "the government" and that of "the market."
*Two qualifications: I suppose it is almost a requisite of recognition as a great social thinker that you be wrong on your fundamental premise. Think of Marx on communist utopia; Hayek on how Atlee would lead us to fascism; Schumpeter on how we would congeal into a cold bureaucratic soup. As to "crashingly wrong," maybe there is another candidate: Michael Jensen declaring tht “I believe there is no other proposition in economics which has more solid empirical evidence supporting it than the Efficient Market Hypothesis.” Link, with context.

Remembering Harry on Barry

I suspect that Maureen Dowd is onto something when she puts her finger on a problem for the Obama White House: not enough black people. Reminds me of Harry Golden's observation on the then-presidential candidate Barry Goldwater: ""I have always thought that if a Jew ever became President, he would turn out to be an Episcopalian."

Saturday, July 24, 2010

This is Really Not Funny

I mean really, not:

18 dead in Love Parade stampede


How Grandpa Haddad Started World War I

A new account of the German/Ottoman relationship brings me back to Frank Haddad of Louisville--that would be Frank Senior, the building inspector and jovial raconteur, not his sons, the far better housetrained criminal lawyers. It was Frank who told me how his father started World War I.

Recall that Kaiser Wilhelm II had a withered arm (You knew? You can more or less see it here). The Kaiser came to visit Istanbul. Grandpa Haddad was part of the Imperial guard. He was to stand in front of the arm.

Grandpa Haddad executed his responsibilities with crisp efficiency. And so the Turks never knew that the German leader had a withered arm. Of course, explained Frank, they would never have permitted their country to go to war under the leadership of a man with a withered arm. The rest is history.

Charlie and Dan

The Charlie Rangel imbroglio is more and more making remember the decline and fall of another Congressman of great talent and impressive achievement who stayed too long and forgot that it was not About Him--until it was. That would be Dan Rostenkowski, a master of the Old Chicago rules who did not figure out that the rules hand change. Or perhaps he never did figure it out: I suspect there is a good chance that Rosty served out his 15 months in the slammer bewildered that anything so awful could happen to one so skilled, so hard working and so devoted (as he saw it) to the interests of the folks who sent him there. You look at Rangel these days, you see the same intelligent sparkle in the eye, the same thin (if just slightly supercilious) smile, the same look of not-quite-get-it. Rangel says he looks forward to a trial so he can vindicate himself. I suspect he is sincere in this: he doesn't really see how he has taken anything more than his due. I feel for him: he's been a good man in his time: smart, warm-hearted, funny and a powerfully effective player. But I suspect that soon now he is going to find himself face to face with the rule set down by Enoch Powell.

Doublespeak of the Day

For your English/marketing dictionary:

Marketing: we must develop a much, much more effective financial relationship with the consumer.

English: we must raise our prices.

One Good Turgenev

In the sweepstakes of Russian literature where he is up against Tolstoy and Dostoevsky, I have always thought Turgenev a distinct runner-up. Well: "Bezhin Lea" is a gem of a story, but his signature Fathers and Sons has always struck me as little more than a political pamphlet. And Virgin Soil seems to me little more than a somewhat lumpish extension of the same. I therefore have tended to ally myself with those who think that Turgenev is overpraised because he is the housebroken and westernized alternative to his more unsettling contemporaries.

But I just stumbled on a Turgenev that seems to be worth the trouble. That would be First Love, as presented in a Librivox download which I carried with me lately for a couple of long drives. Here, at least, we have a framework that seems to fit T's talents: it is a "country-house novel" just as much as so much of Agatha Christie and PG Wodehouse. But it it is neither Christie nor Wodehouse: it is understated and compassionate, and it has the restrained dignity of a formal dance. I figured out the plot about half way--rare for me, I am abysmal on plot and often have to have them explained to me after it is all over. But this time I said ooh noo! and then stood by to watch in horrified fascination as the collision came to pass. The last novel that worked for me in quite this way was Malamud's The Fixer: in each case, you know what is going to happen, you don't want it to happen, you don't want to watch, but you find yourself locked in anyway.

Country-house novel: I suppose you could sniff that this still leaves him as a minor talent. Fine, but a really first-class second-rate is still first class, even if in its own way. Or if nothing else, at least go read "Bezhyn Lea." Here's a free version on line.

Afterthought: Is this the first time I've hyped Librivox? I think maybe. Too bad. They're a great resource and I should do whatever I can to help keep them strong.

Friday, July 23, 2010

Ivan Has a Retirement Project

Well, it beats being a greeter at the blood bank:
I got the editors of the Scrabble dictionary to agree to change the meaning of "goat." They said it was a" horned ruminant" and I told them some breeds of goat are hornless. they said they would change it next edition. it's wrong in major dictionaries also but i haven't contacted them yet.
Now, if someone can find us a goat who is not a ruminant...

I Think I Still Have Those Shoes

1974. Just shy of half a lifetime:

I think I had just got tenure, though why I wasn't happier about it, I cannot imagine.

[Source: the LS Flicker page]

Sadly, It's Me

The other day I got an "is it really you?" message from a long-lost friend on Facebook. Indeed it was really me; we enjoyed a civil exchange pleasantries and that was the end of it. But since then I have started to get bogus "is it really you?" message from the vendors of, oh, who knows, pit vipers or unlicensed Kalashnikovs. Is the timing sheer coincidence, or is the some way the pestiferous ones have learned how to harness the legit messages for their legions of crap?

Mankiw on What We Know and What We Don't Know

Yesterday I was complaining about the abysmal low level of discourse in macroeconomics. As if on cue, here's the nation's leading retailer of economic dogma to undergraduates, serving up as whole heapin' platter of what drives me so nuts.

Yes, I'm talking to you, little N. Gregory Mankiw, with your 800 students a year (and the 100,000 more on your textbook). Mankiw's topic for the moment is the Obama stimulus and you will not have perhaps already guessed that he doesn't like it (Mankiw is one of those academics who never seems to come upon a finding that surprises him--a pretty good negative index in any field of intellectual slackness, IMO).

Mankiw begins with suave plausibility: he gives the case of a doctor who treats a patient in reliance to a well-established theory of disease. The patient does not get better. The doctor can abandon the theory as discredited, or he can double down. Which shall he choose? To answer that question, he'd love to run a rigorous lab experiment. But he doesn't have that option. He has to make prudential professional calculation, also known as a guess.

In the same vein, the Obama folks decided they needed a stimulus to keep unemployment from hitting nine percent. They got the stimulus; unemployment hit 10 percent. Oh dear, they said, the economy must be much worse than we thought.

Reading the Obama story in the light of the doctor example, Mankiw responds: "There is no way to decisively prove or disprove the Obama administration's argument." So far, he is 100 percent right. An unsympathetic viewer would rank it as the worst sort of adhoccery--rank it alongside all those finance types who said that the 2008 meltdown was "a six sigma event," when in fact it may have been nothing more contentious than a proof of the bankruptcy of their theory.

Mankiw knows the culprit, and again, you can guess the name: John Maynard Keynes, propounder of what Mankiw calls "standard textbook theory." That last is pretty rich coming from somebody whose own fantastically successful "standard textbook" propounds just the opposite. But let pass. He's right enough, considering that there is a lot of Keynesianism in the air.

But run the tape slowly and watch the clever hand movement here: Mankiw hasn't said that Obama was "wrong." He hasn't even said that Keynsianism is wrong. He isn't even saying that Keynsianism is discredited. The most he has said is that on the basis of the evidence at hand, there is no basis in principle to choose between the principle and the application.

I'm actually still on Mankiw's side at this point, although I do have my hand on my wallet. I am open--eager, actually--for one of the nation's leading economics/explainers to enter into a thoughtful discussion of just how a thoughtful public person, lacking good evidence but doomed to decide, would go about choosing between these two.

Now you anticipate me. Of course we get nothing of the sort. What we get instead are two things. First, Mankiw offers a miscellany of target practice at some of the more absurd or indefensible "data" about the actual working of the stimulus. Most of these are, so far as I know, spot on, but they aren't particularly new and it seems almost beneath the dignity of an eminence to wear out his cortical tissue regurgitating stuff he's read in blogs. And in any event, they seem to have exactly nothing to do with his initial point about theory and practice.

But he's not done yet. Setting aside his Red Ryder air gun, he turns to a different tactic: he turns to rehashing some economist's studies that call into question the Obama package. Fine, except he seems airily indifferent to the fact that these are subject to exactly the same sort of analytical criticism that he offered at the beginning. So: at the beginning, he has derided the use of "multipliers" in Keynesian analysis. "Humility," he cautions; "economics is still a young science." Somehow all these cautions have gone to the wind when we get down towards the bottom of his paper and find him citing Obama's own Chrstine Romer as one who has generated "multipliers" who support his side of the case. " At odds with most traditional Keynesian analysis," he declares triumphantly. Well, fine, but if multipliers are so elusive, how can we possibly know she is right? Indeed, how can we care?

Mankiw goes on to summarize a number of other studies that deploy just the kind of techniques that he seemed earlier to deride. Perhaps the one most seemingly helpful to his cause is the Alesina/Ardagna study that undertakes a "results" comparison of different sorts of stimuli over time. Mankiw does seem to like this study and, perhaps coincidentally, it does appear to support the result he liked before. He doesn't seem troubled by the fact that it is vulnerable to the same kinds of criticisms that seemed to him so compelling earlier (is the United States truly comparable to Europe? Are the 80s comparable to the naughties?--there's a Krugman snippet with a pretty good comment thread here).

I don't want to tumble into complete nihilism here, as in "we report, you decide." I think the claims of economics are vastly overblown (or were, until the began to look so ridiculous in the late contraction). But it doesn't follow that they are worth nothing. I'm not even willing to give up on rational discourse. No, rephrase that: I love rational discourse. I just wish I heard a bit more of it from people who are so quick to see the mote in the other guy's eye without noticing the beam in their own.

St. John's Eve

"I know what you lack: it's this!" Here, grinning devilishly, he clanked the leather purse that hung from his belt. Peyro gave a start. "How it glows! heh, heh heh!" he bellowed, pouring gold coins into his hand. "How it rings! heh, heh heh! And I'll ask just one thing for a whole heap of such baubles!" "The devil!" shouted Petro. "Let's have it! I'm ready for anything." And they shook hands. "Watch out, Petro, you came just in time: tomorrow is John the Baptist!"
--Nikolai Gogol, "St. John's Eve," in
The Collected Tales of Nikolai Gogol 3-18, 9 (Pevear and Volokhonsky trans. 1999)

"St. John's Day," the Nativity of St John the Baptist, is celebrated June 24. so "St. John's Eve" would be June 23. But Gogol's Ukraine operated on the old-style calendar, so we should add some correction days (exactly how many is an issue all its own).

Afterthought: would it be fair to say that Gogol is like V.S. Naipaul, in that both began doing local-color stories about their natal places, and went on to do more subtle and complicated work after they had encountered life in the big city?

Thursday, July 22, 2010


I have almost nothing original or instructive to add to the Kosovo independence story but I will venture this much: this is one hell of a big deal. There is, obviously, absolutely no limit in principle to how thin we can slice this sausage. And so, no basis in principle on which to establish a government of more than, say, two people. Or one. I wonder how soon the north Kosovars will start complaining about the south Kosovars. Probably happening already.

More on the Macro Recipe Book

I'm still puzzling over the scandal of economic theory that I was mulling over yesterday--the other discontinuity of view between competing schools of macro policy. That would be: the view(s) that (a) we've got to juice more into the system; or (b) we've got to cut, cut, cut. I tend to ally myself with those of my betters who propound the juice theory. And I'd certainly agree that the cut school is heavily populated with the terminally ignorant: people who don't seem to have the most primitive notion of how an economy works, and who are disposed to use government policy of any sort as a focus for their resentment (particularly when propounded by a suspected Kenyan).

But even a blind hog finds a few acorns and an idea has a truth value independent of the person who embraces it. Even if it is not the right remedy for the moment, still the cutter school has defenses or justifications far more sophisticated and plausible than what you are likely to hear on talk radio.

What is lacking, so far as I can tell, is anywhere near enough candid and responsible dialog between grownups who ought to know better. I'm willing to give the yahoos a bye; I'm happy to excuse politicians (at least provisionally) from the class of those who know better. That leaves a tranche--maybe two tranches--of impressively trained professionals who can fashion analytic advocacy of great sophistication, and marshal formidable batteries of data in their support. But they gaze across the void with an attitude of suppressed indignation (the cutters) or ironic indifference (the juicers). On both sides, it is unworthy of them. We the wide-eyed and gap-jawed outsiders deserve better.

Remember the Titan?

As you contemplate the prospect that the (Chinese, Indians, Brazilians, whatever) are about to eat our lunch, you might want a bit of long-view perspective:
TWO decades ago Japan accounted for 14% of the global economy. It is now worth just 8%. In 1988 eight of the top ten companies by value, and eight of the top ten banks, were Japanese; today none makes either list.
Link. The same account reports that Japan's population is forecast to fall to 100 million by 2050; it is now 127 million.

Refriending the Bank

in an update on Goldman Sachs, The Economist showcases an Underbelly favorite--the fiduciary responsibility of banks and in particular, the tectonic shift away from the world in which your banker was your loyal ally and wise counselor, to the world where your banker is just another wild beast ready to eat your guts out. "The conflicts issue," as The Economist characterizes ot "is the most challenging" regulatory issue facing GS Chairman Lloyd Blankfein. Blankfein, the magazine says
rose to the top touting careful conflict management as a competitive advantage. If Goldman could both act as adviser, financier and marketmaker for clients and invest aggressively for its own account, while keeping those roles in balance, it could steal a march on rivals that shied away from this juggling act.

But the conflicts became more tangled as finance grew more complex. And as Wall Street thrived, the bar for what constituted acceptable practice within the industry sagged. “Twenty years ago the [big firms] avoided conflicts. Over time they not only embraced them but stopped asking clients what they thought,” says Clayton Rose of Harvard Business School, speaking of Wall Street generally.

Goldman led the way in exploiting grey areas. But activities that may have got the benefit of the doubt in the bubble years now look like shameless envelope-pushing. No wonder some investors have come to see Goldman as more of a threat than an ally. As the manager of a large hedge fund put it recently, Goldman’s clients talk about it in the same way that campers chatter nervously about grizzlies.

Even though they almost exclusively serve sophisticated institutions, not retail customers, Goldmanites accept the need for change. In the current environment “we can’t say we work in a world of consenting adults, and screw anyone who doesn’t understand,” says one. Moreover, they are well aware that the clause in America’s financial-reform bill targeting “material” conflicts in securitisations is aimed primarily at Goldman.

It will be up to regulators to ensure that any changes in Goldman’s approach are not merely cosmetic, ,,,
Well, good luck to them. It seems like light years from here back to the time before Orange County, before Proctor & Gamble, before Gibson Greeting Cards, before Orange County and all those related episodes where we learned that the bank sucked out all of your proprietary information so as better top take advantage of you.

Wednesday, July 21, 2010

Sonnets by Borges

Here's a pleasant surprise: a dual-languages facing-pages edition of the sonnets of Jorge Luis Borges, lately out from Penguin under the editorship of Stephen Kessler, who says he offers a a view of the writer "quite a different from the ones we thought we knew." That would be me, your honor; but perfectly open to "a portable form" in which "Borges distills all the obsessive themes that pervade his other writings--the mirror, the labyrinth, the garden, the dream, the soldier, the hoodlum, history, oblivion, memory, ancestors, time, eternity, literary and philosophical forebears--into the gemlike form of fourteen tightly rhymed lines." I haven't begun to assimilate all this richness yet, but I do savor a couple of highly Borgesian lines form an item called "Sueña Alonso Quijano," "Alonso Quijano Dreams":
El hidalgo fue un sueño de Cervantes
y don Quijote un sueño del hidalgo.
El doble sueño los confunde ...

The country square was a dream dreamed by Cervantes
And Don Quixote a a dream of the country squire.
The double dream confuses them...
A footnote recalls that Quijano was, indeed, the country squire who dreamed a dream of the country squire. Not clear to me yet how this relates to Borges' inimitable "Pierre Menard, Author of the Quixote," about how the man who (re?)created Quixote as an independent work of art.

Meltdown Bullet Points

Always willing to punch above my weight, I unburdened myself before a bunch of bankruptcy lawyers this noon on the late uproar. Always eager to oversimplify, I came up with four matched sets of bullet points:
  • Housing Bubble or--? I think this one almost answers itself. Housing peaked in 2006; banks didn't melt down until 2008. So, a housing bubble that put a spear into a fragile and vulnerable banking system. Note that this is the first financial crisis top metastasize since 1931.
  • Liquidity or balance-sheet? Bankruptcy lawyers grasp this one: "bankruptcy insolvency" v. "equity insolvency." As phrased, the question again probably tips the hand of the answerer. We had the mother of all liquidity crises in 2008, but we've got a balance-sheet problem that looks like it will stick around for years.
  • How did we get where? "Bleeding Gums" Murphy or Banana Republic? The "Bleeding Gums" school holds that it was all the fault of the undeserving poor who wanted to become the undeserving rich and took on loans they could not possibly repay, thereby destroying the world financial infrastructure (they had help from Jimmy Carter, Chris Dodd and Barney Frank). The Banana Republic school holds that we've become a nation where a small and entrenched elite has come to regard the government as its dedicated honey pot. I suspect there is at least enough truth in either of these views to offend those who embrace the opposite.
  • What do we do next? As in: do we slash the budget or turn on the printing press? This is the pairing that I find hardest to reduce to a soundbyte. But it is the utter discontinuity on this issue--the array of respectable professorships on each side of the case--that does most to enhance the suspicion (a suspicion that I do not embrace)--the suspicion that economics has not yet advanced beyond the realm of campfire fairy tale.
I shared the platform with a working bankruptcy judge who described to us in edifying detail how much his life is dominated by the busted-up mortgage and how he doesn't see any end of it in sight. We passed on discussing the Financial Reform Act; I can't speak for my colleague but I figure it will be another year before we know how completely the lobbyists defang it in rule-making. I did hear somewhere, however, that Mary Schapiro has already said she'll need another 500 employees at the SEC. Insert your own stimulus joke here.

Tuesday, July 20, 2010

Kurosawa's Idiot

Well, here's a surprise. Following up on the Chez Buce readaloud of Dostoevsky's Idiot, Mrs. Buce turned up a film version from a surprising source: Japan, specifically in the work of the great (or formerly great) Akira Kurosawa.

Surprising to me, at least, and I suspect I am not alone. It's early Kurosawa and doesn't seem to me much like the films you associate with K--Rashamon, Ran, Seven Samurai. The difference goes right down to the root of style: K's Idiot is a straightforward, leisurely and linear piece of storytelling, a lot more like Ozu than the K we know (helped mightily along by the presence of Setsuko Hara, who worked so often with Ozu, in the lead role).

For my money, I'd say that K accomplishes something here that seems to elude so many directors: he takes a "classic," and instead of turning it into a mere visual aid, he refashions it into a film which--without in any way betraying the substance of the original--winds up more forceful and convincing than its source.

Well yes, the source, the source. No doubt about it, D's Idiot is an extraordinary work, fully worthy to be discussed in the same breath as Karamazov or Crime and Punishment. But it's a mess: it begins with some of the best writing D ever brought off, but then it descends into the mere shambolic as D tries desperately to figure out just what sort of project he has in mind. Surprisingly, it ends well (many, perhaps most, good novels end worse)--ends well enough to make you forget and forgive the uncertainties and blind alleys of the middle.

K pares it all down. He tightens up the plot, jettisons much of the uncertain middle, and refashions it all into a single convincing story line. He's aided by a superb cast (Setsuko Hara not least among them). It's long; it takes patience (though apparently it is not nearly as long as K wanted--go here). And there is this caveat: I'm really not sure how well it would work with a reader who hadn't already tangled with D's original. Probably here as with so many films made out of good novels, part of what the viewer brings to it is the stuff in mind from having read the book. That's undoubtedly true here also, sauced with the consideration that D has refashioned it into a structure rather more sturdy than its original.

Monday, July 19, 2010

Something Else I Learned Today

Fargo, ND, ranks ninth in the nation for regular flossing and brushing. I suppose they were thinking of this lady:


Susan weighs in with an error message that actually makes sense:

Musical Note (What Do I Care what a Cow Herd?)

Taxmom weighs in with a bit of musical arcana:
Coming down the 5 this afternoon we were behind a boat that was named (or labeled) "Cats Meow". I got into my usual snit about absence of apostrophe, but Zack pointed out that maybe the boat owner was simply stating a fact: Cats meow. (Which led us to consider some other potential boat names...'Dogs drool' for instance.)

Them below "Cats Meow" it said "Jenny Lind, CA" - Steve and both had a vague idea that Jenny Lind was in the Sierra foothills. Not sure what they need a boat for, except that the town is on the Calaveras river. Maybe as a billboard to spread their message about cats?

Jenny Lind apparently never actually came to Jenny Lind. Per Wikipedia, one theory about the name is that the braying mules used by the gold miners led the locals to name the place in their honor.

Costco Marketing: Make 'em Beg

I'm back from one of my periodic forays to Costco. I'm basically a believer--lots of good stuff at high quality. But I never go there for anything more than a simple prescription refill but what I find myself wandering the aisles slump-shouldered and sad-eyed, looking, looking, looking for--whatever I am looking for. It's never in the same place twice. You won't find a clerk to ask and if you do, the chances are s/he'll tell you--oh, it used to be right here but we've stopped stocking that. Indeed, "we've stopped stocking that" is one of the most hopeful phrases in the Costco liturgy prasebook because it is pretty good index that they have not stopped stocking that, and that you will find it right around the corner.

Wiser heads than mine will say: suck it up, big guy! This the price you pay for low prices. Oh, I suppose so, but I think there may be a more sinister undertone. That is: I'm guessing tht somebody down at the University's market research operation told them that a secret to their success is to keep customers humble--meek, a little off stride, with a feeling that they don't really deserve to find what they're looking for. As a market strategy, it works great for prostitutes; why not at out most beloved big-box retailer?

Buce Endoreses Hitchens Endorsing Lewis

I'm late catching up with this one, but I'm impressed to find myself in such total agreement with two of the most tiresome voices in British public life:
C. S. Lewis maintained in his classic statement “Mere Christianity”: “That is the one thing we must not say. A man who was merely a man and said the sort of things Jesus said would not be a great moral teacher. He would either be a lunatic — on the level with the man who says he is a poached egg — or else he would be the Devil of hell. You must make your choice. Either this man was, and is, the Son of God; or else a madman or something worse.”
The endorser of Lewis here is Mr. Overexposure himself, Christopher Hitchens, who amplifies:
Absent a direct line to the Almighty and a conviction that the last days are upon us, how is it “moral” to teach people to abandon their families, give up on thrift and husbandry and take to the stony roads? How is it moral to claim a monopoly on access to heaven, or to threaten waverers with everlasting fire, let alone to condemn fig trees and persuade devils to infest the bodies of pigs? Such a person if not divine would be a sorcerer and a ­fanatic.
Wish I'd said it.

Palinian Refudiations

Soberer heads than mine are reaching for the Tylenol this morning as they try to cope with Sarah Palin's coinage of the word "refudiate," and her subsequent undertaking to refudiate the same. Critics are assigning it to the dustbin of history even before it has enjoyed its 15 minutes of fame.

I would not be so quick to dismiss it. I'm sure it will be around at least long enough for its own 15-minutes of self-irony. I assume there is already a tee-shirt (white on black sounds right) saying "I refudiate Sarah!" And coming soon to a garage near you: a band called "The Refudiators." It sounds like a good name for that little novelty box that you'd find on the bar at cocktail lounges--you'd pull a lever and a hand would reach out and pull the lever back.

But the history of coinages in political campaigns is equivocal at best. The most noteworthy example I can think of (and even this may not be a true coinage) is Warren G. Harding:

America's present need is not heroics, but healing; not nostrums, but normalcy;

I suppose "normalcy" remains "a word" in some sense, but I suspect it has never quite passed over the barrier into respectability, lashed ever, as it must be, to Harding's own somewhat shabby reputation. "It's not really a world," muttered my not overly respectable mother (who usually voted Republican). It languishes in the dustbin of languages somewhere close to Dan Quayle's "potatoe," and perhaps for similar reasons.

She's right on a related point, though--that another successful word-coiner was himself, William Shakespeare: thanks to him, hot-blooded Sarah is free to put up a howl of amazement at the barefaced and baseless falsehoods of the newsmongers as they argue that the Arctic ice is being discandied. And if Katy Couric ever asks her to just, maybe, name a few Shakespearean coinages, she can go here.

Update: Loving critics tell me that I've overlooked George W. Bush. I guess I can see where they're coming from, but most Bushisms take the form of waky nonlinear (or colinear?) sentences or paragraphs--as in "One of my concerns is that the health care not be as good as it can possibly be." I suppose I should make a place for "misunderestimated," though.

The Mother of all Trust Fund Babies

If you've ever dreamed of making a whole bargeload of money so your children could live on Central Park West, go here.

Sunday, July 18, 2010

The Best Recent Finance Book You Haven't Read...

...and probably haven't even heard about would be Rick Sauer's Selling America Short, with the somewhat opaque subtitle "the SEC and Market Contrarians in the Age of Absurdity." I spotted it on a half-price shelf in Barnes & Noble (less than three months after publication) and bought it largely because I knew Rick very slightly 30 years ago and was curious what had become of him.

Aside from the anodyne title, I can see why it sank like a stone. For an author and subject so central to our late nightmare it's a book almost utterly devoid of marketing hype (e.g., "How you can profit from Rick's three lessons!"). For a book with "SEC" on the cover, it is offers almost nothing on the hot-button suspects: no more than incidental references to Bernie Madoff, Chris Cox, or the guy who watched x-rated videos all day long on his government computer. There's an abstraction/summary of the most recent months of turmoil, but it's predictable stuff and it comes with almost nothing by way of proposals for reform.

What you've got here instead is a memoir of Rick' career first as an SEC lawyer/regulator; then for a short time in private practice, and finally as an active player in a "hedge fund" (actually four guys in a shingled office down by the Berkeley Marina). The writing is fluent and informed, but the style is mostly understated, ironic, wry and self-deflationary--exactly what you do not want for a blockbuster.

So, why bother? The answer is that this is about the best and most convincing account I've seen anywhere of life tweendecks in the glamorous world of high finance. By his own account at least, Rick seems to have performed with honor and competence in all his roles, but he never became anything like a mover and a shaker. And that is precisely what makes him so interesting.

Far and away the best parts are the early chapters about the SEC. So far as I can tell, Rick at the SEC was not one of those infamous time-servers who rebuffed all the allegations about Bernie Madoff. What he seems to have been was a reasonably bright, reasonably hard-working lawyer/bureaucrat who knew the difference between right and wrong but who wasn't about to risk his neck in cases of high political visibility or sensitivity--at least not on the taxpayer dime. And this focuses attention on the hellacious part: Rick provides evidence that this stuff is hard--lots of tedious, day-after-day paper-shuffling, with no real certainty that any of it will go anywhere, and a soupçon of danger from the possibility that you might, even if unintentionally, find yourself crosswise with the politicals in the agency or up on capital hill.

Rick offers particularly diverting accounts of a couple of cases that make this point in spades, with the added fillip that they are international--not at all a rarity in a globalized world, but enough to kick the difficulties and the aggro into a whole new dimension.

Rick left the practice after a mid-length career as a regulator, for a new avatar as a bigfoot defender. Oddly, this part of the book is perhaps the least interesting, and I suspect the reason is that it wasn't that-all interesting to the author itself. To hear Rick tell it, defending white collar fraud (at least of this kind) is not rocket science; you have to sit tight and make sure your client doesn't blurt out a full confession in front of the camera. Ironically, the hard part may be actually getting the clients: if the work is this easy, no wonder there are a lot of competitors.

But then somewhat to his own surprise he finds himself morphing out of law practice into a new role as an active participant in the world of hands-on investing; a chapter we might like to call "Life Among the Naked Shorts." Rick never explicitly summarizes just what it was that made the naked-short life so plausible and so dangerous, but I think we can extract a picture. Try this:

BigCo is selling for $100 a share. A short-seller (let's call him "Rick") undertakes to sell a share of BigCo for $100, but he doesn't own what he's selling. Instead, he borrows and sells a share, with the intention of buying another share to cover his position later. Why would anyone enter into such a lamebrained fandango? The reason is that Rick is betting that the price will fall.

But put it in a larger context. Rick bets that BigCo will fall because he believes that BigCo will fall, which is to say that he knows something sufficiently awful about the fundamentals of BigCo that it will drive the price down one the investors catch up.

So far so good. The complication is that Rick (hypothetical) also has an incentive to drive the the price down, if not by fair means, then by foul.

But look at it from the standpoint of the beleaguered company and consider this generalization: as far as the CEO of BigCo is concerned, there never was an honest short. Anyone who is shorting BigCo is a termite eating the heart out of capitalism. Short investors, as Randy Newman did not say, got no reason to live.

This is a poisonous brew. More precisely a poisonous brew in one of the more gaseous outcrops in the financial universe. In short (hem) planet short-sell is populated by some of the crabbiest, most vindictive, most impolite--okay most uncouth--species of market watcher you'd ever want to encounter.

This is the realm that (the non-hypothetical) Rick--to all appearances, a pretty decent guy-- wandered into when he left law practice. I should state for the record that I (along with Rick) entertain a disposition that is largely pro-short. No doubt there are crooks and malefactors in this business but for the most part I think shorts offer a wholesome therapy to the market, purging it of some of its worst impulses, and helping to heave close onto the shores of rationality.

The question remains, of course, why anyone, however much of a true believer, would wander into this landscape of noxious exhalations? One reason, I suppose, is "to make big bucks," but that is hardly sufficient. Some people have gotten rich from short-selling but it is hazardous work under the best of circumstances: recall the canard that "the market can stay stupid for a lot longer than you can stay solvent." There are other ways to make money that are perhapsno more onerous but not quite so laced out with nastiness and vindictiveness.

Why, specifically did Rick do it? His memoir is mostly unencumbered by anything like serious introspection. On the evidence, my own best guess is that here is a guy that just enjoys being in the midst of nasty and rancorous financial dustups where the recriminations fly back and forth like so many rotten mackerel, and where the chances of a truly happy result for all lie somewhere between "highly unlikely" and "not on your life." Did I mention that he says--boasts--that he lives right next door to the Hayward Fault?

So as his high school guidance counselor, I might have sought to explore with him a less bruising career path. As a reader, I can easily console myself with the insight that it is, after all, a very good story.

Afterthought: Every time I hype this book to somebody, the conversation somehow morphs into a discussion of Michael Lewis' The Big Short. That's a good book too, but entirely different. A closer comparison might be Robert Sloan's Don't Blame the Shorts, and catch that cute bunny thing in the upper right-hand corner.

Anniversary: Caravaggio

Four hundred years ago today, or maybe tomorrow: the death of Michelangelo Merisi da Caravaggio, perhaps in or around Porto Ercole, near Grosseto in Tuscany. He disappeared on his way back to Rome, hoping to be pardoned for a murder he had committed half a dozen years before. The circumstances are murky although he apparently was not (as one might readily have assumed) killed by an enemy (of whom he had many) or in an affair de passion (of which he also had many. Just lately investigators in Italy declared they had the problem nailed--it was the lead, from the paints--but explanation looks just a tad tendentious to me, and I think I'll wait for a more considered judgment.

Caravaggio is odd in so many ways. I think his best work is riveting, about a lot of the second-tier seems to me to be--well, just that. Considering what we see in the Northern European Baroque, he might be the most influential painter of his generation, perhaps even of all time. Yet until the 20th Century, nobody paid much attention to him. Rembrandt, for example: everything about the mature Rembrandt cries out "Caravaggio!" Yet there is no evidence that Rembrandt ever heard of him.

I read the Peter Robb biography a while back: it was informtive, but a bit showy for my taste. There's a new one that is getting a good press--though how anyone could write a dull book about so flamboyant a career is beyond my guessing. Google offers a gratifying menu of Caravaggios here. Meanwhile, if I had to name just one "greatest painting ever," I'd still go for Caravaggio's Calling of St. Matthew.

Saturday, July 17, 2010

Something Else I Learned Today

Per Wiki, singer Hank Williams was named "Hiram" after King Hiram of Tyre, by convention one of the founders of the Masons. It was misspelled "Hiriam" on his birth certificate.

Remind me Again, Why is There a Kindle?

Don't me wrong--I've been the proud possess or of a Kindle (I) since Mrs. Buce presented me with one a couple of Christmases ago. I carry it with me; I've got 100 books on it, including a complete Shakespeare; I was reading on under my little clip-on light, just last night when I couldn't sleep. It's a little beat up around the edges (I am a serial abuser of physical equipment). But we're practically joined at the hip.

And don't get me wrong again: electronic books are here to stay. Complain as we may, they're only going to get more pervasive and, on the whole, better--more readable and more generally usable.

But--why the Kindle? As many have pointed out, what we've got here is an overpriced and underpowered laptop. Is there anything--anything--that can be done by the Kindle, which cannot be done by any computer appliance with a laptop connection?

I can think of only two possible ways of saying "yes" to that question, and neither seems decisive on the larger issue. One: long battery life. The tradeoff of having such a limited machine is that it doesn't suck up much juice. You easily can bang around with it for several days without a refill, if you are discreet about your actual use. And two: instant access to the Amazon honey pot from any place in the US (sic, not yet "the world").

But is that enough? Lately we've encountered the Ipad (I don't own one) which offers--so they tell me--something very close to the same experience. And closer to home--even more telling--I've got that Kindle app on my little $329 netbook. It isn't quite the same as the Kindle itself. To read, I do have to peer over the keyboard. So far as I can tell, I don't have instant access to the Apple net. I don't have a week-long battery--but I do have a battery which runs 6-9 hours (depending on how I use it) which for almost every purpose is, thank you quite long enough. And backlit. Did I say backlit? I could do away with that little clipon light.

So on balance, the difference between the Kindle and the netbook is at best pocket change.
There's also the matter of availability on my mobile. I don't have it right now; turns out my device is too old or kludgy to install. But that's a detail; like everyone else on the planet, I will be buying a new mobile soon, and I'll make sure to get one that will take an ebook app. No, no, I don't want actually to read War and Peace on a 1.5-inch screen. But as a distractor while standing in line at the DMV--oh, I can only dream.

So: had Amazon simply introduced the app first, I can't see why anyone would have bought the app at all. They made one of the oldest of business mistakes: they failed to understand what business they were in. They weren't selling devices, they were selling books, and they could sell them as well or better without the device. Oh and perhaps needless to say--if this is true of the Kindle, I really can't see any future for the Barnes & Noble Nook. And those other guys, those poor forlorn first movers, I forget, name begins with S.

Friday, July 16, 2010

Underbelly's First-ever Friday Cat Blog

While Mrs. B was taking a turn driving yesterday, I indulged myself with a few pages of Randall Jarrell's Pictures from an Institution, often billed as the best-ever academic novel. It is not, not least because it is not a novel: it is a series of tableaux, loosely connected with the barest of plot. Or anecdotes or, better still, one-liners--sharp, witty, carefully crafted, somewhat recherché. Not surprising, therefor that it is often gratuitously mean-spirited, though other parts exhibit a cheery generosity.

Among characters whom Jarrell seems to like best are the Rosenbaums, Gottfried and Irene--he an Austrian, she Russian. He's a musician, a composer in residence on Jarrell's fictional campus, lately arrived from Europe. The unnamed narrator dismisses what must be a tumultuous past with a gauzy indifference, making it clear that they've found their niche here in his little corner of America. The narrator is in general delighted with their (as it seems to him) courtly old-world manners. Here, he arrives to pay a call:
[T]here was a score on the floor, as usual, with two teacups beside it. (The house floated on tea and Rhine wine.) ...Irene and Gottfried shook my hand; like most Europeans, they gave the impression of wanting to shake hands with the cat whenever it came into the room-to shake hands and utter a short formal sentence that would express their genuine pleasure at getting to see Frau Katze again.

--Randall Jarrell, Pictures from an Institution 149
(University of Chicago Press ed. 1986)
For extra credit, address the question whether it is really true that Europeans look like they want to shake hands with the cat.

Thursday, July 15, 2010

Xie on Wine

I'm off horsing around with grandchildren in Oregon for a couple of days. Meanwhile, take a look at Andy Xie's unbeatable analysis of the Chinese wine biz. Nice to know they are paying big money for fakes.

BTW I see you've got finance reform out of the Senate and capped the well. I ought to stay away longer.

Wednesday, July 14, 2010

Wish I'd Said It: Johnson on Axelrod

Simon Johnson reports that David Axelrod did a session with Diane Rehm this morning:
He was awful. ... [T]there was no narrative – why exactly did we have a recession, why has it been so bad, and why aren’t the jobs coming back?

Without a narrative, how can anyone make sense of the past 18 months?

Axelrod can choose his narrative – and obviously doesn’t need to agree, for example, with the view that the financial system became dangerous and now needs to be reined in - but he has to say something coherent. You can’t just make isolated points like “the fiscal stimulus helped” or (even more confusing) “we’ll now address the budget deficit.”

There was really no explanation for why the economy has become such a difficult place for so many people. How did we go from apparent prosperity in 2007 to the deepest recession of the past 50 years? And how are we going to get the jobs back?

Well, strictly speaking, I didn't hear Diane Rehm so I'm not in a position to say whether Axelrod was awful or not. But it certainly fits my perception: you can't win without a story and these guys do not have a story.

Reality Descends on Edmond de Goncourt

Jules, younger of the de Goncourt brothers, died on the night of June-18-19 1870, something like halfway through the life of the literary diary that will make him famous alongside his elder brother, Edmond. Over the next couple of days, Edmond records the inevitable impulses of rage and despair. Then, for most of a month, silence. Then on 14 July:
I had put up for sale the house in which he died and to which I had not desire to return. Today I received some perfectly acceptable offers for a six-year lease. Well, unreasonable and illogical though it may seem, these offers have plunged me into a profound melancholy. I find that i am attached to this house in which I have suffered so much by bonds whose existence I never expected.
--Edmond and Jules de Goncourt, Pages from the Goncourt Journals 166
(NYRB ed. copyright 1962)

...but just ahead lay the Franco-Prussian War, the Siege of Paris and the Commune: evnets which, inter alia, appear to have reinvigorated Edmond as the inimitable observer and journalizer, the person who more than anyone else has shaped and defined out view of 19th-Century Paris. Remarkably, he makes no mention of the fact that July 14 is Bastille Day

Coincidence? I Think Not...

From the Huffpost morning feed:

Thanks, John...

Tuesday, July 13, 2010

A Celibacy Rule for Academics

I see that this morning's San Francisco Chronicle has outed the cost-to-taxpayers of the UC Berkeley athletics program. Bully for them, even if the story was just there for the taking and even conceding tht nothing--absolutely nothing--will come of it, unless you include the energy expended on a few rolled eyebrows.

It's the kind of story that has been on my mind off and on for some months now. I'm a happy duespayer at a "University" athletics club, although I expect my fairly modest mite doesn't in any way reflect the elegance and comfort of the facility in question. Meanwhile here in Palookville, the (former) proprietor of a private health club is telling anyone who will listen that he was put out of business with the University (different U) opened its facilities to paying customers.

These are just a more reminders of a story we've all known about for a long time: universities have long since lost any but the mot tenuous contact with their nominal mission statement. Rather they've become a loosely linked network of independent contractors persuing a heterogeneous range of more or less profitable enterprises ranging from wine-making to nuclear weaponry. They are, in short, more and more like medieval monasteries (plus nukes), where a small and highly privileged core live lavishly at the effort nd expense of a vast multitude of others.

The monasteries of course at last more or less choked on their own bodily fluids and I suppose the universities will as well. But I can think of one important differences between the medieval monastery and the modern university: celibacy. Or at least the appearance thereof. Celibacy is an elusive goal at the best of times, and I suppose the assembled monks, with the customary array of nuns, choirboys, goats and whatever were not much better than the rest of the human race. But keeping up the pretense can be onerous and the existence of the principle, however fraudulent, can be a handy whip for the authorities to use to keep lesser mortals in line.

There is an economy in nature. Now that celibacy (or the tattered pretense thereof) is at last abandoning the Catholic church, I wonder if it is time to impose a rule of celibacy on tenured University professors. Probably won't crimp their sails much but it might operate at least as an irritating encumbrance, like a hair shirt. Come to think of it, while we're at it, let's reinstitute the hair shirt.

Footnote: For generally fawning accounts of the career of a guy who deployed more than a billion dollars in public money to enhance his own private fortune, go here.

Jesus Wept

Rick Sauer recalls his days as a beginner in the enforcement arm of the Securities and Exchange Commission:
Like many of my new colleagues, I had never taken a course in securities law. I asked my imediate supervisor what I should read to begin mastering the field. She eyed me as if I were a very curious item indeed and said, "Don't bother. There's too much of it and anyway, you won't remember anything you haven't actually used.
--Richard Sauer, Selling America Short (2009)

Rick adds: "In retrospect, right she was."

Monday, July 12, 2010


Been chatting with my buddy John about the scary stuff in this week's excellent Economist overview of the present and future of Europe. E.g.: "At 40%, youth unemployment in Spain is not just high; it is a moral indictment of an entire system."

Well, yes. But wait--these are Spanish statistics we are talking about. Does anyone take at face value any number generated in Club Med? Put another way: are these 40 percent really staying home sitting on their thumbs and slant-drilling into daddy's pension pool? Some, sure. But a good many, I suspect, have found a way to work off the books, reducing the nominal report to--

--to what, exactly? Of course I don't know for sure. To complicate things, I'm sure the degree of misreporting varies from place to place; I would expect better data from (say) Helsinki than I would from Athens (we all remember --yes--? that wonderful New York Times aerial photo a few weeks back showing all the off-the-books swimming pools in the mother of civilization).

But it's not just Club Med. The Economist says that in Belgium, the portion of potential workers between 55 and 64 actually labor force is just 35 percent--a fact which the E finds "disastrous," reporting that "in Sweden, the proportion is twice as high." I have no idea what to make of this, not least because Belgium is a country I could never figure out. No, rather two countries, yoked unwillingly together with a world capital at center. Repeating, must we believe that the non-working 65-percent cohort of Belgian junior/seniors is simply sitting it out (over an agreeable Belgian beer, perhaps?). Is Sweden really that different? Or is the Sweden number an index of Belgian laziness as of sloppy Belgian reporting?

Sunday, July 11, 2010

433 Years Ago Yesterday...

...Dutch clobbered the Spanish at the Battle on Eems.

Thanks, Taxmom.

Bush's Third Term?

Weekend meme: Obama #1 is Bush #3.

It's a tempting thought as we watch our President morph into the Rodney King of American politics--savagely beaten around the head and shoulders, only to emerge with a plaintive "can't we all get along?" People said he'd come to hate it soon enough: the Presidency as long-term confinement.

There's certainly a degree to which he's brought it all on himself. He never quite warned us (though we might have noticed, if we'd had our eyes open) that he was a compulsive centrist at heart--we weren't really prepared for the shock. He might not have suspected himself how comfortable he would be with the experience of power once it was his hand on the lever. And he really does not seem to have mastered the knack of articulating his vision--meaning that he'll be burned in effigy at the tea-party convention, the same time he is being skinned alive by Glenn Greenwald.

In his (partial?) defense, you'd have to say also that what we are observing here also is a phenom of modern first-world politics: every modern leader takes office the prisoner of a larger agenda, and the agenda is eye-poppingly narrow. As the original proposer points out, it's not just Obama--Bill Clinton remained captive of Ronald Reagan, and Tony Blair, of Margaret Thatcher. People who do try to rewrite the script--Bush #2, Reagan--do succeed in breaking some crockery, but at the end of the day, they probably change a lot less than they wished.

So Obama's natural instincts play naturally into a larger framework which might serve to define him even if he wasn't so willing to be defined. The really successful ones (I suppose Reagan is the example again) are the ones who convince us they are bringing "change" when they're leaving no sacred cow unbloated. Still, at least once in a while you'd think he might reach for the crockery. I mean, is that too much to ask?