"It is easy to confuse what is with what ought to be, especially when what is has worked out in your favor."
- Tyrion Lannister

"Lannister. Baratheon. Stark. Tyrell. They're all just spokes on a wheel. This one's on top, then that's ones on top and on and on it spins, crushing those on the ground. I'm not going to stop the wheel. I'm going to break the wheel."

- Daenerys Targaryen

"The Lord of Light wants his enemies burned. The Drowned God wants them drowned. Why are all the gods such vicious cunts? Where's the God of Tits and Wine?"

- Tyrion Lannister

"The common people pray for rain, healthy children, and a summer that never ends. It is no matter to them if the high lords play their game of thrones, so long as they are left in peace. They never are."

- Jorah Mormont

"These bad people are what I'm good at. Out talking them. Out thinking them."

- Tyrion Lannister

"What happened? I think fundamentals were trumped by mechanics and, to a lesser extent, by demographics."

- Michael Barone

"If you want to know what God thinks of money, just look at the people he gave it to."
- Dorothy Parker

Saturday, January 12, 2013

Fed Watch: On The Disruptiveness of the Platinum Coin by Tim Duy

Jon Stewart Flunks Econ by Jonathan Chait

National Income Accounting for the Washington Post and Robert Samuelson by Dean Baker

Aaron Swartz, Precocious Programmer and Internet Activist, Dies at 26
In 2007, Mr. Swartz wrote about his struggle with depression, distinguishing it from the emotion of sadness. “Go outside and get some fresh air or cuddle with a loved one and you don’t feel any better, only more upset at being unable to feel the joy that everyone else seems to feel. Everything gets colored by the sadness.” When the condition gets worse, he wrote, “you feel as if streaks of pain are running through your head, you thrash your body, you search for some escape but find none. And this is one of the more moderate forms.” Earlier that year, he gave a talk in which he described having had suicidal thoughts during a low period in his career.... 
Lawrence Lessig, who heads the Safra Center at Harvard and had worked for a time on behalf of Mr. Swartz’s legal defense, noted in an interview that Mr. Swartz had been arrested by the M.I.T. campus police two years to the day before his suicide. That arrest led to the eventual federal indictment and financial ruin for Mr. Swartz, who had made money on the sale of Reddit to Condé Nast but had never tried to turn his intellect to making money. “I can just imagine him thinking it was going to be a million-dollar defense,” Mr. Lessig said. “He didn’t have a million dollars.”

Tributes to a Digital Pioneer Follow Reports of His Death
Another friend, the legal scholar and copyright activist Lawrence Lessig, wrote an angry post, describing the federal government’s decision to indict Mr. Swartz in 2011 — when he was charged with downloading 4.8 million articles and other documents from JSTOR, a nonprofit online service for distributing scholarly articles, and plotting to make them available online for free — as a kind of “bullying.”
Here is where we need a better sense of justice, and shame. For the outrageousness in this story is not just Aaron. It is also the absurdity of the prosecutor’s behavior. From the beginning, the government worked as hard as it could to characterize what Aaron did in the most extreme and absurd way. The “property” Aaron had “stolen,” we were told, was worth “millions of dollars” — with the hint, and then the suggestion, that his aim must have been to profit from his crime. But anyone who says that there is money to be made in a stash of ACADEMIC ARTICLES is either an idiot or a liar. It was clear what this was not, yet our government continued to push as if it had caught the 9/11 terrorists red-handed.
Aaron had literally done nothing in his life “to make money.” He was fortunate Reddit turned out as it did, but from his work building the RSS standard, to his work architecting Creative Commons, to his work liberating public records, to his work building a free public library, to his work supporting Change Congress/FixCongressFirst/Rootstrikers, and then Demand Progress, Aaron was always and only working for (at least his conception of) the public good. He was brilliant, and funny. A kid genius. A soul, a conscience, the source of a question I have asked myself a million times: What would Aaron think? That person is gone today, driven to the edge by what a decent society would only call bullying.
Tributes also appeared on Twitter, where Mr. Swartz had recently posted a note [his last] drawing attention to the campaign for the Treasury to mint a $1 trillion platinum coin to avoid a showdown over the debt ceiling.
"Philip Diehl, the most respected U.S. Mint director America's ever had, joins the campaign to buff.ly/Zp58iM" 8 Jan. 13
Mint the coin. For Aaron. Regarding the bullying of prosecutors, I always thought the anti-bullying campaign targeting school kids was worthwhile but kind of weird. American culture is all about the bullying. It's how you get ahead. Where do these bully kids learn it but from their older siblings and parents?

Public choice = Marxism by John Quiggin

Can an exploitation movie be a great movie? with Tasha Robinson and Scott Tobias
JSTOR (pronounced jay-stor;[3] short for Journal Storage) is a digital library founded in 1995. Originally containing digitized back issues of academic journals, it now also includes books and primary sources, and current issues of journals.[4] It provides full-text searches of more than a thousand journals, dating back to 1665 in the case of the Philosophical Transactions of the Royal Society. More than 7,000 institutions in more than 150 countries have access to JSTOR. Most access is by subscription, but some old public domain content is freely available to anyone, and in 2012 JSTOR launched a program of free access to some further articles for individual scholars and researchers who register.
On July 19, 2011, internet activist Aaron Swartz was charged with data theft in relation to bulk-downloading academic journal articles from JSTOR.[9] According to the indictment against him, Swartz surreptitiously attached a laptop to MIT's computer network, which allowed him to "rapidly download an extraordinary volume of articles from JSTOR".[10] Prosecutors in the case say Swartz acted with the intention of making the papers available on P2P file-sharing sites.[11] Swartz surrendered to authorities, pleaded not guilty to all counts and was released on $100,000 bail. Prosecution of the case is ongoing.[12] Two days later, on July 21, Greg Maxwell published a torrent file of a 32-GB archive of 18,592 academic papers from JSTOR's Royal Society collection, via The Pirate Bay, in protest against Swartz' prosecution.[13][14] 
From September 6, 2011, JSTOR has made some public domain content freely available to anyone.[15] JSTOR stated that they had been working on making it free for some time, and the Swartz controversy made them "press ahead" with the initiative.[16]
Swartz committed suicide yesterday at the age of 26.
Swartz's father worked in the computer industry, and from a young age Aaron was interested in computing, frequently studying computers, the Internet and Internet culture.[3] At the age of 14 Swartz co-authored RSS 1.0 Specification. He later attended Stanford University, however he left after one year of studying, stating 'I didn't find it a very intellectual atmosphere, since most of the other kids seemed profoundly unconcerned with their studies'.[3]. Instead he founded the software company Infogami, a startup that was funded by Y Combinator's first Summer Founders Program.[4] 
Through the Y Combinator program, Swartz found himself working on the Reddit website. Initially finding it difficult to make money from the project, the site later gained in popularity, with millions of users visiting it each month. In late 2006, after months of negotiations, Reddit was sold to CondéNet, owners of Wired magazine.[3] Swartz moved with his company to San Francisco to work on Wired, but grew unhappy with the set-up[3] and in January, 2007, he was asked to resign from his position.[5] Swartz described himself as being ill and suffering from a constant depressed mood throughout 2007.[6] In September, 2007, Swartz joined with Simon Carstensen and launched Jottit. In 2010-2011 he was a fellow at Harvard University's Edmond J. Safra Center for Ethics.[7] 
Swartz was also the creator of the web.py web application framework,[8] and co-founded Demand Progress,[7] a progressive advocacy group that organizes people via email and other media for "contacting Congress and other leaders, funding pressure tactics, and spreading the word" about targeted issues.

Friday, January 11, 2013

Platinomics by Greg Ip

I disagree with Ip more often than with most economic writers I read in that he seems to take it easy on Bernanke and the Fed, often writing with skepticism about what the Fed can accomplish. That's exactly what Romer and Romer warn about.

Fed Watch: More on Central Bank Independence by Tim Duy

Wednesday, January 09, 2013

Django is a BAMF*

I recently saw Tarntino's "Django Unchained," the first part of PBS's "The Abolitionsists," and the season opener of "Justified."

"Justified" was entertaining and had a number of sudden turns. A conflict is being set up between Boyd Crowder and an evangelical preacher who is successfully weening the residence of Harlan County off of Oxycotin and the other drugs Crowder is peddling by turning them on to the opiate of religion. A down on her luck prostitute could be the Crowder's downfall. And it was gratifying to hear Walton Goggins quote Asimov and Keynes to one of his pushers who had found the Lord and stolen Boyd's money.

Goggins was also in the highly entertaining "Django Unchained." Great performances by the actors: Jamie Foxx, Christoph Waltz, Leonardo DiCaprio, Samuel Jackson, and Don Johnson (and Jonah Hill,etc.) I loved the soundtrack. While Tarantino helped the Germans look bad in "Inglorious Basterds," in "Django Unchained" one of the protagonists is a anti-slavery German bounty hunter played by Waltz. Waltz's Dr. Schultz is a great humanist and shows that Germans have a great liberal, pro-enlightentment tradition - see Goethe, Schiller, Beethoven, Marx - one that was crushed by war, economic depression and fascism.** Southerners come off really bad as the Germans did in Basterds. All the actors do an outstanding job, but Jackson's Uncle Tom Steven is the one who stuck with me. What a nasty fellow. I liked DiCaprio's speech on phrenology and the supposed submissiveness of blacks (everyone tossed about the N word.) And I liked how Tarantino had that one slave who hated Django because he thought he was a black slave trader. Pretty brutal but entertaining movie. DiCaprio could get some awards. Jackson should.

"The Abolitionists" was kind of brutal too but very thought-provoking and educational. It was the first of three episodes and focused on Frederick Douglass, Garrison, William Lloyd Garrison, Angelina Grimké, John Brown and Harriet Beecher Stowe. All of the whites were hardcore evangelical Christians who believed slavery was a sin. Douglass was a slave at first. He wasn't submissive enough for his owner so he brought in someone out of Tarantino movie, a guy who would "break" slaves by beating them once a week. Douglass fought back, even though it meant death, and bested the "breaker" guy who never told or came back, because if word got out his reputation would be damaged. Douglass said up to that point he had been a boy, but from there on he was a man. Grimké's story was very interesting as she was a black sheep of one of the wealthiest Southern (slave-owning of course) families, if not one of the wealthiest in the world at the time. But she felt slavery was a sin and worried for the souls of her fellow white southerners. So she moved north. In one dramatized scene, Garrison was attacked by a pro-slavery mob in the North and was so rattled he bowed out of the movement for a while. A lot of drama about Slavery these days, see "Lincoln" also.

*Bad ass mother fucker.
**Dr Shultz at one point asks a southern musician at the plantation to stop playing Beethoven, because I assume it's offensive to him to hear such beautiful music in such a context. He notes the irony of the plantation owner admiring the black French novelist Dumas. He holds up the idealism and morality of art in contrast to corrupt institutions. On a personal, emotional level, Shultz also has bad flashbacks over the recent mauling of a runaway slave by dogs he witnessed. This reminded me of similar episodes or stories about Europeans like Nietzsche and William Wilberforce, both of whom became unhinged after witnessing the beatings of a horse by its master.

I have some German ancestry. On my father's side my great-grandmother emigrated from Germany to New York City where she married another German immigrant who died young. One of her nephews (my grandfather's cousin) was conscripted late in WWII and sent to the Eastern Front. He disappeared as the Red Army advanced westward. My grandfather fought in the Pacific.
    "Inglorious Basterds" did have some good Germans, so to speak: the starlette played by Diane Krueger and Til Shweiger's Sgt. Hugo Stiglitz. And the German soldier who had heard of Stiglitz was pretty tough and honorable in a way:

My third blog post back in March 2004 on the first day of the blog's existence.

Titled: "Fast, badass zombies versus slow, dumbass zombies" and linked to "My Stupid Dog" blog.
Dawn of the Dead and ressentiment

I probably won't see the remake of George Romero's Dawn of the Dead. I love the original, though I think Romero lost the eeriness of Night of the Living Dead when he decided to make Dawn in color. But the remake has one major problem that I could see from a mile away.

To paraphrase James Carville, it's the zombies, stupid. In the remake, they're first-rate badasses. They act as if they were on a constant adrenaline high. They have extra speed and super strength. They are powerful. They're much like the beefed-up, overcaffeinated, perpetually angry "infecteds" in Danny Boyle's recent 28 Days Later. And they're all wrong.

Romero's zombies are weak, slow and stupid. You could outsmart one, outrun it, or if need be, take it down in a fair fight. The only problem is, these zombies vastly outnumber any humans still alive. The ratio is several dozen zombies to one warm body in Night; by Day of the Dead it's grown to something like several hundred thousand to one.

In Romero's Dead trilogy, zombie attacks become an objective correlative for what Nietzsche called ressentiment. They involve a mobocratic tyranny, as weak and incompetent corpses band together and achieve a dominance over the living minority that they could not otherwise attain. It's no surprise, then, that Romero's zombie attacks usually involve a surrender of the individual "live" person to a mob of walking dead. Dawn and Day both feature an attack in which dozens of zombie bodies burst from an enclosed space (in Dawn, an elevator; in Day, a locked roof) and overwhelm a human in a wave attack. Most telling, though, is that when the zombies attack, their arms are outstretched toward the victim, as if they were begging for something. Which, in a manner of speaking, they are: They all want a little piece (or maybe a big piece) of the human victim. Engulfed in this mob's sudden coercive demand, the living human falls to the ground, where seething masses literally devour him.

Seldom do these zombies succeed at a one-on-one attack, and when they do, it's usually because the victim has a misplaced sense of compassion. Of course, Nietzsche claimed that along with democracy, compassion and religion were other weapons that the weak routinely use against the strong. But in Romero's Dead trilogy, victims of one-on-one attacks seldom die quickly; instead, they malinger for days, "infected" by a deadly virus which apparently all walking dead carry. Upon their death, they become assimilated into the faceless mob. Compassion for the weak comes with a very heavy penalty.

Of course, the survivors in Romero's films don't fare too well, either: Their individualistic tendencies lead to squabbling and bickering. In the Dead trilogy this infighting becomes an all-too-predictable motif. Individuals seem more concerned with battling each other than with defeating the hordes of walking dead, and as a result they are unable to form the coalitions necessary to turn the tables on the mob.

Nietzsche's vision of individualism was no less tragic. The social apparatus, fueled by ressentiment, stacks the deck against the great-souled man (or ubermensch) to the point that his only real options are to withdraw or perish. Dawn and Day opt for withdrawal; Night, the most bracing and unnerving of the three, chooses death instead. Ayn Rand attempted to resolve this basic problem in Atlas Shrugged by uniting all productive men and women. Yet she fails to recognize that John Galt's crypto-fascist consensus of resistance is no more conducive to individual activity than the repressive societies these productive folk attempt to resist.

Whatever we can say of Romero, he is at least smarter than Rand. His zombie flicks frighten us not just because they're gory or shocking, but because they insinuate that, much as we may like the idea of individualism, it may not have much of a future in an increasingly mobocratic society. The idea of being overwhelmed by stinking masses, of being forced into a way of life (or death) we would not choose for ourselves, lies at the maggot-infested heart of the original Dead trilogy. That's why it disturbs us long after the lights come up.

The slow, dumbass zombies of "The Walkind Dead" return in February. The zombie phenomenon is now rivaling the vampire one. These are the fastest, badass zombies I've seen to date:

Coin of Freedom

The platinum coin idea is idiotic. That is the point. by Neil Irwin (Jan. 9)
This idea is positively idiotic, though it has gained a more and more respectable set of fans. (They now include Bill Gross, the nation’s biggest bond investor, a Bush administration economist named Donald Marron, and the Nobel laureate and New York Times columnist Paul Krugman). Some of the critics are misunderstanding what it would do and wouldn’t do. The fact that it is idiotic is kind of the point.

Everything You Need to Know About the Crazy Plan to Save the Economy With a Trillion-Dollar Coin by Matt O'Brien
Enter the trillion-dollar coin. It sounds nuts. But there's a loophole that actually lets the Treasury create coins in whatever value it wants, even $1 trillion. It's all straightforward enough. The Treasury would create one of these coins, deposit it at the Federal Reserve, and use the new money in its account to pay our bills if the debt ceiling isn't increased. This has gone from being just another wacky idea in the world of internet comments to something that's getting taken seriously due, in large part, to the efforts of Joe Weisenthal of Business Insider and Josh Barro of Bloomberg View to promote it. (Which you can follow on Twitter at #MintTheCoin). Their logic is that as silly as the trillion-dollar coin sounds, the debt ceiling is far sillier -- and much more destructive.

As this terrifying report from the Bipartisan Policy Center shows, the consequences of going over the debt ceiling are unthinkable and unpredictable. At best, it will mean immediate 40 percent austerity; at worst, it will mean an outright default on our debt. Both are bad enough that a legal gimmick like the trillion dollar coin sounds sane in comparison, if it comes to that. At least that's what Representative Jerry Nadler, Paul Krugman, and, as of pixel time, over 6,000 other patriotic Americans think.
The Hobson's choice is either let the economy crash and burn or further the banana-republicization of America.

Jeffrey Lacker, a Man Who Never Changes His Mind No Matter How Often He's Wrong by Yglesias

A Bold Dissenter at the Fed, Hoping His Doubts Are Wrong by Binyamin Appelbaum

Okun, Unemployment, and Wages by Jared Bernstein

Tuesday, January 08, 2013

Keith Phipps leaves the A.V. Club.

Panel Moderator: J. BRADFORD DELONG (University of California-Berkeley)

CARLO COTTARELLI (International Monetary Fund)
PAUL KRUGMAN (Princeton University)
VALERIE A. RAMEY (University of California-San Diego)
HARALD UHLIG (University of Chicago)

Is he right? Will rightwingers admit they don't care about the unemployed, inequality or the output gap? You would think that rightwingers would like to close the output gap and then funnel the gains to the 1 percent and/or cut taxes.
Nate Silver on Reddit today at 1 p.m. CST.

Bobo Brooks pushes the Pete Peterson agenda and lies by omission once again by failing to mention the housing bubble.

Andrew Ross Sorkin waves away the housing bubble and financial crisis by classifying them as a once-in-a lifetime event:
While there is no question that the original rules would do a better job preventing the next 100-year flood in the banking system, their quick adoption most likely would have created their own drag on the economy because bank lending would most likely have been curtailed.
Hopefully Yellen is right and Bernanke will raise rates on reserves to slow the economy when it needs slowing in 2018 or whenever the output gap is closed.

Monday, January 07, 2013

Why Is Our Policy Agenda So Biased Toward Fiscal Policy? (As Opposed to Jobs…) by Jared Bernstein
TARP didn't buy a recovery as Geithner promised and it discredited ARRA in the public's confused mind. We spend all of this money for such a tepid recovery.
Romer & Romer on Monetary Policy Complacency by Yglesisas

Sunday, January 06, 2013

The Fire Next Time

Or Hostage-taking extortion by the banks and Republicans

Rebranding the “trillion-dollar coin” by Steve Randy Waldman

Kicking the can down the road, either by Waldman's reasonable suggestion or by a deal that doesn't include cuts to entitlement benefits but does have spending cuts, may buy time for the Republicans to be voted out of office. My preference would be for a confrontation.

Secret and Lies of the Bailout by Matt Taibbi

Yellen: Fed Likely to Vary Interest Rates for Reserves in Future (via Thoma)

I don't believe there will be bailouts next time. And there will be another bubble as the financial industry successfully blocked reforms.

So we should just shoot the hostages in both cases and let the banks and Republicans deal with the consequences.

Sen. John Cornyn's Outrageous Op-Ed on the Debt Ceiling by Yglesias

Politicians are often successful shakedown artists and the debt ceiling clown show is just a big shakedown. Republicans lost the Presidential race and Senate seats hopefully in part because of the clown show in 2011.