July 2010


In the face of a fragile recovery and a huge deficit, my country (Britain) along with the rest of Europe seems to have decided to cope by imposing huge cuts to public services that will screw over not just the public sector but the private sector too (who will lose contracts and custom as budgets and jobs are cut and individuals tighten their belts). The coalition’s reasoning is that the “markets” are going to demand “austerity”. The same markets which caused the crisis in the first place. Now I’ve had a radical idea; instead of that, why not tackle the problem at the source?

The cause of booms and busts is speculation. Traders on the financial markets start paying more for a commodity (i.e. real estate in Florida’s 1920s land boom or house mortgages in the recent crisis) than they are really worth. What follows is a  feedback spiral of increasing prices (people buy the booming commodity because they expect its price to rise, therefore it does). Then, there is a collapse and a crash in the price, which may trigger a wider depression in the economy, as in 1929, and now. The interesting thing is that the bust is due to illusion as much as the boom is – prices in the busted commodity have fallen to less than their real value. It’s as if a large herd of people were able to falsify the currency by accident.

Now my modest proposal is this; why not ban speculation?  What would modern economies look like without it? And do you think it would be possible?

—Mornche Geddick

You’re rightly skeptical about calls for austerity— a strange and useless thing in the middle of a recession.  Thanks to the zero bound, we’re in the rare position where stimulus spending is virtuous.

At the same time, remember not to reify the idea of the “real value” of any commodity.  There’s no such thing; the price of something is what someone will pay for it.  The idea that there’s some real or natural or underlying price for an item is common but only gets you into trouble later on.

As for banning speculation… well, I’m no economist, but my understanding is a) you can’t really isolate it from benign investment, and b) you really don’t want to.  It’s one of those irregular verbs: I invest, you speculate, he throws his money away.  Or to put it another way, investors are optimistic people willing to use their or other people’s money to take risks.  Firms and governments benefit from their willingness to give away money, admittedly a thought hard to keep in mind when we’re suffering from crashes they engineered.

What you can do is try to isolate some of the worst excesses and regulate them.  For instance, the magic of leverage usually looks pretty dubious after a crash, and regulations can be tightened.  We can try to separate regular banking from investment banking, or require income checks on mortgages, or (as the recent bill passed here does) put risky instruments like derivatives in a new exchange that can be explicitly watched.  At best it’s a dance: we try to prevent the last crisis but someone invents a new way of getting in trouble.  (At worst there’s no reform, and a succession of crises, because the speculators are too politically powerful to oppose.)

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I finished Batman: Arkham Asylum tonight.  The word on the street was that it was good, and lo, so it was.  It turns out I really dig this sort of game– a mixture of combat and stealth, seen also in Beyond Good & Evil and The Chronicles of Riddick.  I was strongly reminded of the latter, because of the badass hero.  And though Riddick is plenty badass, come on, this is Batman here. 

Look at that spine. Ouch.

You want dark atmosphere from Batman, and the game delivers: Arkham Asylum is a creepy place even before it’s populated with escaped convicts, various supervillains, and later on mutant plants.  I may play it again just to enjoy it at a more leisurely pace.

It’s really a blast taking out henchmen one by one… you can swoop around in the rafters or the vents, sneak up behind them, drop with a powerful kick, blow them up, and more.  Combat is not bad, though I have trouble with the play style.  I’m sorry, I tend to mash keys– if R reloads than hitting it several times reloads faster, right?  I’m only slowly learning to face each baddie (close aiming doesn’t seem to be necessary) and hit attack just once. 

As my friend Chris points out, it’s a little weird that Batman only gradually learns how to fight thugs and acquires extra health and weapons along the way.  How many years has he been doing this?  But it’s no wierder than Batman ending up dead whenever you fail a fight. 

One cute bit: when you die, the villain of the moment taunts you briefly. 

One of the few games I can’t really find anything to complain about.  A couple boss fights were something of a chore, but it can’t all be easy thug takedowns. 

It’s also one of the few games where the enemies notice what you’re doing and react accordingly.  They start out overconfident, then start discovering the bodies of their comrades and make increasingly panicked comments.  Much better than the “Today you die!” lines of many video games.  It’s also nice to lose the annoying gabheaded evil overlords– I’m looking at you, Harbinger.  Joker talks a lot but at least he’s amusing.

Michael Kinsley defined a gaffe as a politician accidentally speaking the truth.  The Republicans have had some gaffe problems lately.

One example is Rep. Joe Barton’s apology to BP, echoing the views of 115 representatives in the “Republican Study Committee” as well as the Heritage Foundation.  Barton’s kowtow was to the ultimate loyalty of the party: to big business and its ability to do whatever the hell it wants.  Making BP pay for spilling millions of barrels of oil into the Gulf would be a bad precedent; what if other corporations had to pay for their mistakes?

Then there’s the kerfuffle over the NAACP calling out Tea Party racists, and Andrew Breitbart’s disgusting smear of Shirley Sherrod.  This isn’t Breitbart’s first foray into selective editing to fan racial fears; he was also behind sending fake pimps to ACORN.  Put this together with racist smears at Obama and Arizona’s demonization of immigrants (the governor thinks they’re all drug mules); sadly, racism and race-baiting have not disappeared just because the rest of us elected a black president.

But in the latter controversies, not everyone played along.  One Tea Party faction disowned another for the racism of its leader, and many conservatives criticized Breitbart.  It’s not really a schism, but it’s interesting to see a little pushback against the extremists, who usually terrorize the rest of the party.   Still, losing a news cycle means very little; the GOP won’t really change till it loses elections.  

Andrew Sullivan likes to contrast the frothing Republicans with the newly triumphant Conservatives in Britain; David Cameron’s victory required moving away from Thatcherism.  It’s nice to know that a rational conservative party is possible; it’s going to take many years, though, before we have one here.

ME: Okay, fine, you’re in my office. Why? And again, who are you?
WOMAN: You know why I’m in your office, Josh. You’ve been here with me for the last three or four hours.
ME: Lady, I don’t know who you’ve been with in my office, but I haven’t been there for two weeks. I mean that’s a problem itself, my lack of motivation, but lets get back to what you’re doing there?
WOMAN: Well…I met someone claiming to be you on the internet and he paid me to come to your office and have sex with him. Only he didn’t pay me. He left. And now I’ve wasted my whole fucking night.

Read it.

I forgot one more thing I wanted to say about Mass Effect 2: Jennifer Hale deserves some massive kudos for the voice acting for Shepard.  It wouldn’t be the same without her.  It’s unapologetically butch– every line emphasizes that she’s one tough and cool customer– though she puts in just enough warmth and humor when needed. 

I like almost all of the other voice actors too.  I also appreciate the variety, especially after playing Oblivion, whose concession to the fact that not all voices are alike is to have two actors per species.

I finished Mass Effect 2 tonight.  I pretty much did it by the book and saved the whole crew.  I destroyed the base.  The crew all liked that, which is evidently a big fat setup for Mass Effect 3.   I’m really curious to know what all the ME2 choices will do, or if they’ll find a way to make them as marginal as saving the Council was.

Shepard listens in a paragonish way

I ended up 100% paragon and about 20% renegade, without any great effort.  I’d often have conversations where I’d get a little of both.  There’s a couple points where renegade is irresistible, such as a certain point involving high explosives.  

It’s a great game, ten times better than ME1.  Each of the missions feels different, and the last one is an intense ride, much better and harder than the ending of ME1.  By the end I wanted to kill Harbinger not so much because he wanted to destroy all human life, but because of his frigging annoying patter.  “This hurts you.”  “Your death is assured.”  “We will end you.”  He’s basically a huge telepathic pubbie.

Combat works well– you have to think about what weapons to use.   By the end I could integrate guns and biotics better.  I still think heavy weapons ammo is a little sparse, though it’s probably well calibrated for a replay, when you’d know what the bosses are.

Ocassionaly the pretense required by the game mechanic shows through… e.g. the quarians, who have an entire fleet, are unable to take a geth-held spaceship, but you can do it with a squad of three.  Usually it’s more convincing why a commando mission is more likely to succeed than either the local flatfoots or one of the many well-supplied armies around.

It’s really pretty linear: you can choose the order of missions, but you’re well advised to do them all, and there are only a few side quests.  This isn’t necessarily a bad thing, unless you were expecting more of a sandbox, or an easier completion path.

It’s been a while since I last had TV, and when I seem to end up anywhere near a TV set that’s playing news, it’s always set to Fox News or CNN, neither of which are worthwhile–it seems that CNN has decided to replace investigative journalism with downright speculation and social network pandering, a trend that should have died with the 2008 election; and Fox News has replaced any sort of journalistic intent with hate-mongering, interference, and some clever uses of rhetoric (I’ve noticed that one of their correspondents, a Megan with a “y”, speaks with this slightly angered trill, pure skepticism, or outright disgust–a tactic that might cause an unwary listener to get also angry, not at her or her annoying voice, but at what she’s reading.)  So, what is a good news source these days, especially for the political sphere?

On another note, Tennessee’s 2010 gubernatorial elections are coming up.  We are faced with a fairly weak Democratic candidate (Mike McWherter, son of former Gov. Ned McWherter), and the Republicans are still debating their primary.  One of the candidates for the primary, a Zach Wamp, believes that because people lost their jobs in the private sector, people who work for the state should be punished by having their salaries cut, or their jobs lost (which is his intent–to merge Department of Human Services and Department of Children Services, then cut off the bottom 12%).  According to him, state workers who have to pay the same as private sector employees for insurance, and who earn 10,000 dollars less a year than someone with the same qualifications in the private sector, should be punished because there are people without jobs–a sentiment I also overheard on Fox News.  Is this something I misheard or misinterpreted?  Or is this some old sentimentality against state employees from long-ago?

—Nikolai

Easiest bit first: conservative ranting.  It’s a bit reflex anti-government rhetoric, a bit a strange but longstanding consie preference for economic pain.  There was a lot of this during the 2008 financial crisis: just let the banks and the auto industry fail!  See also the lost four years of  Herbert Hoover.  Instead of seeing a recession as a technocratic problem that can be solved, they prefer to see it as a moral failure that must be punished.  It’s barmy and sadistic: much better for the country is, you know, for people to have jobs.  Shrinking the economy, including the state portion of it, only deepens the pain.

As for news sources, ever since I gave up Time when it dumbed itself down, I can’t say I have a great solution.  Forget TV though.  You can absorb a lot more information by reading than watching.   The best news source I know is the Economist, but I read it only rarely.  For what’s-going-on I read CNN online.  I read the New Yorker regularly, and books to understand issues in depth.  A book like Vali Nasr’s The Shia Revival or George Packer’s The Assassin’s Gate will tell you more about the Middle East than a hundred news stories.

I like Andrew Sullivan’s blog for commentary and interesting links.  He’s amazingly prolific and quotes reasonable people both liberal and conservative.  For understanding economics Paul Krugman is fantastic.  I read a few other blogs but you’ll find them if you read Sullivan anyway.

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