Monthly Archives: May 2012

Ring Of Fire

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a href=”http://prometheus.med.utah.edu/~bwjones/2012/05/ring-of-fire/”>

Brian Jones:

The annular eclipse of 2012 just rolled through the Western United States and I, along with millions of my fellow human beings, made the journey across parts of the planet Earth in the American West to view a transitory astronomical sight. An annular eclipse is when the Sun and the Moon are precisely in line but because the Moon’s apparent diameter does not completely occlude the Sun. When this happens, a rim of the Sun shines around the shadow of the Moon creating an apparent ring of fire.

Most eclipses including annular eclipses occur over the ocean or over sparsely populated areas of the planet, so this was a relatively unique opportunity to photograph an annular eclipse from a relatively close place to home. This photo was made from South Central Utah about 20 miles West of Cedar City where I managed to find a place overlooking a valley with a nice view of the sunset in amongst the juniper trees.

An absence of optimism plays a large role in keeping people trapped in poverty

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The Economist:

THE idea that an infusion of hope can make a big difference to the lives of wretchedly poor people sounds like something dreamed up by a well-meaning activist or a tub-thumping politician. Yet this was the central thrust of a lecture at Harvard University on May 3rd by Esther Duflo, an economist at the Massachusetts Institute of Technology known for her data-driven analysis of poverty. Ms Duflo argued that the effects of some anti-poverty programmes go beyond the direct impact of the resources they provide. These programmes also make it possible for the very poor to hope for more than mere survival.

Faith is vital.

Europe’s depressing prospects

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Michael Pettis:

Humpty Dumpty economics



The first way is for Germany to reverse its surplus and begin running large deficits. This is by far the best way, but I think it is very unlikely. Berlin has made no indication that it is prepared to do what would be necessary for it to run large deficits and, on the contrary, it is even talking about the need for more austerity.



In part this is because Germany has a potentially huge debt problem on its balance sheet. As a consequence of its consumption-repressing policies during the decade before the crisis, Germany’s domestic savings rate was forced up to much higher than it otherwise would have been and Germany has had to export the excess capital. Not surprisingly, given European monetary dynamics, this capital has been exported largely to the rest of Europe in order to fund the current account deficits of peripheral Europe that corresponded to the surpluses Germany so badly needed to grow.



It did this not by accumulating euro reserves, which it could not do anyway, but rather by accumulating loans to peripheral Europe through the banking system. As a result of all of these loans, Germany is rightly terrified that a wave of defaults in Europe will cause its own banking system to require a state bailout if it is not to collapse, and so it does not want to cut taxes and reduce savings because it believes (wrongly) that austerity will make it easier to protect its creditworthiness.



But German’s anti-consumption policies are leading it towards a debt problem in the same way that similar US policies in the late 1920s created an American debt crisis during the next decade. In that light I thought this very illuminating quote from then-presidential candidate Franklin Delano Roosevelt might be apposite:

On Manufactured Influence

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Dan Howe:

Why do people fake their online influence? Dan Howe, who once experimented with follower gaming, explains.
Faking influence in order to alter public behaviour is a very old marketing tactic. As far back as the 1930s, it was routine for promoters to hire good looking young people to wait outside concert halls for lead operatic sopranos, both encouraging actual theatre goers to join the mob for autographs and to stage a good shot for the press.


Similar activity persists today, with shops like Abercrombie & Fitch purposefully maintaining a queue out front in order to keep up the appearance of popularity and companies like HP turning the popular kids on US campuses in to paid brand ambassadors.


While it is generally accepted practice, openly discussed and debated in the media and among marketers, when it comes to applying the same principles online, you tend to get awkward silence from industry professionals.


Last year, PR Week broke a story about Covert PR, a firm apparently offering the services of “posters” to submit online comments to mainstream media websites to “help sway and nudge the debate” in favour of its clients.

Going to the doctor and worrying about cybersecurity

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Jeremy Epstein:

For most people, going to the doctor means thinking about co-pays and when they’ll feel better. For me though, it means thinking about those plus the cyber security of the computer systems being used by the medical professionals.


I’ve spent more time than usual visiting doctors recently. I broke my hand – sure I’ll tell you how. It was a hit-and-run accident with a woodchuck.

I was riding my bike, the woodchuck ran in front of me, I ran over him, and he fled into the woods, leaving me lying on the ground moaning in pain. Okay now that we got that out of the way…

So the emergency room doctor ordered a CT scan (to check for a concussion and the presence of a brain) and various x-rays. I thought about the computer controls while in the CT scanner, but what was really interesting was when the hospital emergency room digitized the results and gave them me on a CD to provide to the orthopedist.

Before going to the orthopedist, they had me fill out a bunch of forms online. As I provided the detailed medical information, I wondered how secure the web interface is, and whether someone could attack the medical record system through the patient input interface.

Which raises the question: Why are they here? If you’re here just to get reelected, you’re worthless to the country

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Ezra Klein interviews Tom Coburn:

EK: It seems your view is that just as the market needs to have faith in your demographics and in the flexibility of your labor market and the competitiveness, it has to have faith in your political system’s capacity to deal with long and short-term threats. Do you see any reason for the market to have that faith right now?

TC: No. One of my biggest worries is what happens if Romney wins and Republicans control both chambers, do they have the courage to do what it takes to fix the country? It’s kind of their last chance. If they’re given the favor of control and they don’t act on it, why should you ever trust them again? You shouldn’t. It’ll be the death knell of the Republican Party. They controlled it all for four years under Bush and grew the government. They created a new entitlement with no revenue. Went against the very tenets of what they said they believe.



One of the reasons I wrote the book was to show a whole lot of people how many stupid things we do. I don’t really blame presidents too much. You gotta get appropriations. I say the problem is not that we don’t get along. We get along too well. Government is twice the size it was 10 years ago. The president can’t spend the money if we don’t appropriate it. So it’s not a president problem. It’s a congressional problem.

Accidentally Released – and Incredibly Embarrassing – Documents Show How Goldman et al Engaged in ‘Naked Short Selling’

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Matt Taibbi:

A quick primer on what naked short selling is. First of all, short selling, which is a completely legal and even beneficial activity, is when an investor bets that the value of a stock will decline. You do this by first borrowing and then selling the stock at its current price, then returning the stock to your original lender after the price has gone down. You then earn a profit on the difference between the original price and the new, lower price.



What matters here is the technical issue of how you borrow the stock. Typically, if you’re a hedge fund and you want to short a company, you go to some big-shot investment bank like Goldman or Morgan Stanley and place the order. They then go out into the world, find the shares of the stock you want to short, borrow them for you, then physically settle the trade later.



But sometimes it’s not easy to find those shares to borrow. Sometimes the shares are controlled by investors who might have no interest in lending them out. Sometimes there’s such scarcity of borrowable shares that banks/brokers like Goldman have to pay a fee just to borrow the stock.



These hard-to-borrow stocks, stocks that cost money to borrow, are called negative rebate stocks. In some cases, these negative rebate stocks cost so much just to borrow that a short-seller would need to see a real price drop of 35 percent in the stock just to break even. So how do you short a stock when you can’t find shares to borrow? Well, one solution is, you don’t even bother to borrow them. And then, when the trade is done, you don’t bother to deliver them. You just do the trade anyway without physically locating the stock.

Darell Issa Puts Old Leaked TPP IP Text Up For Discussion

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TechDirt:

We’ve written a few times now about Rep. Darrell Issa, and the Madison platform his office has set up to allow for crowdsourcing opinion on legislation and other government documents. He originally used it for his OPEN Act, but then later posted the text of ACTA as well. His latest move is to post the leaked text of the US’s negotiating position on TPP. This is the same text that leaked out last year. It would be nice if the USTR did something like this itself with the latest text, but that’s not how USTR Ron Kirk works. To him “transparency” is only sharing the text with big industry special interests, and declaring it a matter of “national security” if anyone else wants to see it.

Life lessons for the office

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Andrew Hill:

Clayton Christensen achieves the difficult feat for a tall, broad man of being at once imposing and humble. When I visited him last autumn at Harvard Business School, he laid out with quiet authority his latest thoughts on disruptive technology, the concept that justly made him famous in the mid-1990s. But he also took time to chat about his son’s college basketball team, a poster of which hangs on one wall of an office full of family photos and memorabilia.


While he places great value on his family and faith – he is a devout Mormon – his research and teaching have dominated his public story. Until now, outside the Acknowledgements section, he has never tried to put his personal and professional lives in the same book.