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This Economy Does Not Compute

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glen ep ropella

This Economy Does Not Compute

http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin

--
glen e. p. ropella, 971-219-3846, http://tempusdictum.com

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Matthew Francisco-2

Re: This Economy Does Not Compute

from Rob Axtell:
http://krasnow.blogspot.com/2008/09/goldilocks-on-wall-street.html#links

On Wed, Oct 1, 2008 at 8:29 AM, glen e. p. ropella
<[hidden email]> wrote:

>
> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin
>
> --
> glen e. p. ropella, 971-219-3846, http://tempusdictum.com
>
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org
>

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Douglas Roberts-2

Re: This Economy Does Not Compute

In reply to this post by glen ep ropella

On another mailing list that I frequent, there is a small core of Republicans who *insist* that is was the DemoCRAPS[sic] who caused our current economic crisis.

I sent the following message to them yesterday, after finding the nice, short informative article in Time (link below). I find that it is sometime necessary to use small words when dealing with political zealots.

Astonishingly, it was not the DemoCRAPS[sic] who were the cause of our current financial fuck-up. Read this short article to discover who is really to blame.

Can you say, "Risky derivatives trading"? Can you say, "Irresponsible hedge fund management"?

I knew you could.

http://www.time.com/time/business/article/0,8599,1845209,00.html?cnn=yes

Me, I'm an independent.

--Doug

--
Doug Roberts, RTI International
[hidden email]
[hidden email]
505-455-7333 - Office
505-670-8195 - Cell

On Wed, Oct 1, 2008 at 9:29 AM, glen e. p. ropella <[hidden email]> wrote:

http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin

--
glen e. p. ropella, 971-219-3846, http://tempusdictum.com

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Kenneth Lloyd

Re: This Economy Does Not Compute

In reply to this post by Matthew Francisco-2

Excellent article!

As complexity wonks, most of us understand that static models are woefully
incomplete, and that dynamical systems modeling is one of the precursors to
understanding complexity. This implies the study of systems at some
distance from equilibrium.

Hopefully, we can encourage people to join us in the 21st century and adopt
these methodologies.

Just got a FRIAM post: "This economy does not compute." Perhaps a move from
the deterministic to the stochastic is in order. Our economy computes, but
in non-analytical ways. It's complex ... Doh!

Ken

> -----Original Message-----
> From: [hidden email]
> [mailto:[hidden email]] On Behalf Of Matthew Francisco
> Sent: Wednesday, October 01, 2008 9:43 AM
> To: The Friday Morning Applied Complexity Coffee Group
> Subject: Re: [FRIAM] This Economy Does Not Compute
>
> from Rob Axtell:
> http://krasnow.blogspot.com/2008/09/goldilocks-on-wall-street.
> html#links
>
> On Wed, Oct 1, 2008 at 8:29 AM, glen e. p. ropella
> <[hidden email]> wrote:
> >
> >
> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opi
> > nion&oref=slogin&oref=slogin&oref=slogin
> >
> > --
> > glen e. p. ropella, 971-219-3846, http://tempusdictum.com
> >
> >
> > ============================================================
> > FRIAM Applied Complexity Group listserv Meets Fridays
> 9a-11:30 at cafe
> > at St. John's College lectures, archives, unsubscribe, maps at
> > http://www.friam.org
> >
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org

Matthew Francisco-2

Re: This Economy Does Not Compute

In reply to this post by Douglas Roberts-2

Doug,
I think it's a poor move to use a model--did the Officers use a model
for their article in Time?--to fix blame with such confidence
especially when the thing to blame is a vague collective identity.
Granted, sometimes it seems that such fixing is needed because we need
to reaffirm our own group identifications especially if they are under
attack or ignored and more so if we are in political season. The
point of Buchanan's article, I think, is that models are good at
generating alternative narratives about causation in systems where no
single person or group of people can ever know 'the system' and the
experts and stakeholders all see the system in different ways, with
different stories about how the system works. I think a more
ambitious goal for modeling these systems is bringing together or
overlaying (integrating?) these local stories into a sort of
meta-narrative.
Matt

On Wed, Oct 1, 2008 at 8:44 AM, Douglas Roberts <[hidden email]> wrote:

> On another mailing list that I frequent, there is a small core of
> Republicans who *insist* that is was the DemoCRAPS[sic] who caused our
> current economic crisis.
>
> I sent the following message to them yesterday, after finding the nice,
> short informative article in Time (link below). I find that it is sometime
> necessary to use small words when dealing with political zealots.
>
> Astonishingly, it was not the DemoCRAPS[sic] who were the cause of our
> current financial fuck-up. Read this short article to discover who is
> really to blame.
>
> Can you say, "Risky derivatives trading"? Can you say, "Irresponsible
> hedge fund management"?
>
> I knew you could.
>
> http://www.time.com/time/business/article/0,8599,1845209,00.html?cnn=yes
>
>
> Me, I'm an independent.
>
> --Doug
>
> --
> Doug Roberts, RTI International
> [hidden email]
> [hidden email]
> 505-455-7333 - Office
> 505-670-8195 - Cell
>
> On Wed, Oct 1, 2008 at 9:29 AM, glen e. p. ropella <[hidden email]>
> wrote:
>>
>>
>> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin
>>
>> --
>> glen e. p. ropella, 971-219-3846, http://tempusdictum.com
>>
>>
>> ============================================================
>> FRIAM Applied Complexity Group listserv
>> Meets Fridays 9a-11:30 at cafe at St. John's College
>> lectures, archives, unsubscribe, maps at http://www.friam.org
>
>
>
>
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org
>

Douglas Roberts-2

Re: This Economy Does Not Compute

Mathew:

The Time article I referred to had nothing to do with modeling; it described the reality of how the money was lost.

Follow the money. Average Joes and Janes are not the holders of the other side of complicated, over-the-counter derivatives contracts. Rather, hedge funds are the main holders. The bailout will involve a transfer of wealth — from the American people to financial institutions engaging in reckless speculation — that will be the greatest in history.

In essence, the large, institutional mortgage financial institutions used their mortgage assets as a stake against which they leveraged (bought on margin) to play in the volitile financial derivatives market.

Everybody knows how cool it is to buy on margin when the market is going up.

Now everybody also understands how uncool it is to be caught with your pants down after having bet the ranch, leveraged to the hilt, only see the market suddenly tank.

Stupid, stupid, stupid! And now our political leaders want to bail out those reckless, foolish fund managers and their bosses.

--Doug

--
Doug Roberts, RTI International
[hidden email]
[hidden email]
505-455-7333 - Office
505-670-8195 - Cell

On Wed, Oct 1, 2008 at 10:27 AM, Matthew Francisco <[hidden email]> wrote:

Doug,
I think it's a poor move to use a model--did the Officers use a model
for their article in Time?--to fix blame with such confidence
especially when the thing to blame is a vague collective identity.
Granted, sometimes it seems that such fixing is needed because we need
to reaffirm our own group identifications especially if they are under
attack or ignored and more so if we are in political season. The
point of Buchanan's article, I think, is that models are good at
generating alternative narratives about causation in systems where no
single person or group of people can ever know 'the system' and the
experts and stakeholders all see the system in different ways, with
different stories about how the system works. I think a more
ambitious goal for modeling these systems is bringing together or
overlaying (integrating?) these local stories into a sort of
meta-narrative.
Matt

On Wed, Oct 1, 2008 at 8:44 AM, Douglas Roberts <[hidden email]> wrote:
> On another mailing list that I frequent, there is a small core of
> Republicans who *insist* that is was the DemoCRAPS[sic] who caused our
> current economic crisis.
>
> I sent the following message to them yesterday, after finding the nice,
> short informative article in Time (link below). I find that it is sometime
> necessary to use small words when dealing with political zealots.
>
> Astonishingly, it was not the DemoCRAPS[sic] who were the cause of our
> current financial fuck-up. Read this short article to discover who is
> really to blame.
>
> Can you say, "Risky derivatives trading"? Can you say, "Irresponsible
> hedge fund management"?
>
> I knew you could.
>
> http://www.time.com/time/business/article/0,8599,1845209,00.html?cnn=yes
>
>
> Me, I'm an independent.
>
> --Doug
>
> --
> Doug Roberts, RTI International
> [hidden email]
> [hidden email]
> 505-455-7333 - Office
> 505-670-8195 - Cell
>
> On Wed, Oct 1, 2008 at 9:29 AM, glen e. p. ropella <[hidden email]>
> wrote:
>>
>>
>> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin
>>
>> --
>> glen e. p. ropella, 971-219-3846, http://tempusdictum.com
>>
>>
>> ============================================================
>> FRIAM Applied Complexity Group listserv
>> Meets Fridays 9a-11:30 at cafe at St. John's College
>> lectures, archives, unsubscribe, maps at http://www.friam.org
>
>
>
>
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org
>

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Pamela McCorduck

Re: This Economy Does Not Compute

I see it as Doug sees it. This week's Economist has the most incoherent
leader I have ever seen in twenty years of reading that journal. I'm
not an economist, but I do know my way around my mother tongue, and in
essence they're saying, "Don't cap executive salaries because this is
our best talent...that, yes, got us into this mess." Huh? "They might
move offshore." Well, hey, don't let the door hit you in the backside.

Last night at the theater by chance I sat next to somebody who, it
turned out, was an old Morgan Stanley guy from way back. He told us
he'd pulled everything out of the market 16 months ago. "Anybody could
see this coming." Not if you're twelve years old at heart and can't
believe bad things can ever happen to wonderful, Master-of-the-Universe
you.

On Oct 1, 2008, at 12:41 PM, Douglas Roberts wrote:

> Mathew:
>
> The Time article I referred to had nothing to do with modeling; it
> described the reality of how the money was lost.
>
> Follow the money. Average Joes and Janes are not the holders of the
> other side of complicated, over-the-counter derivatives contracts.
> Rather, hedge funds are the main holders. The bailout will involve a
> transfer of wealth — from the American people to financial
> institutions engaging in reckless speculation — that will be the
> greatest in history.
>
> In essence, the large, institutional mortgage financial institutions
> used their mortgage assets as a stake against which they leveraged
> (bought on margin) to play in the volitile financial derivatives
> market.
>
> Everybody knows how cool it is to buy on margin when the market is
> going up.
>
> Now everybody also understands how uncool it is to be caught with your
> pants down after having bet the ranch, leveraged to the hilt, only see
> the market suddenly tank.
>
> Stupid, stupid, stupid! And now our political leaders want to bail
> out those reckless, foolish fund managers and their bosses.
>
> --Doug
>
> --
> Doug Roberts, RTI International
> [hidden email]
> [hidden email]
> 505-455-7333 - Office
> 505-670-8195 - Cell
>
> On Wed, Oct 1, 2008 at 10:27 AM, Matthew Francisco
> <[hidden email]> wrote:
>> Doug,
>> I think it's a poor move to use a model--did the Officers use a model
>> for their article in Time?--to fix blame with such confidence
>> especially when the thing to blame is a vague collective identity.
>> Granted, sometimes it seems that such fixing is needed because we
>> need
>> to reaffirm our own group identifications especially if they are
>> under
>> attack or ignored and more so if we are in political season. The
>> point of Buchanan's article, I think, is that models are good at
>> generating alternative narratives about causation in systems where no
>> single person or group of people can ever know 'the system' and the
>> experts and stakeholders all see the system in different ways, with
>> different stories about how the system works. I think a more
>> ambitious goal for modeling these systems is bringing together or
>> overlaying (integrating?) these local stories into a sort of
>> meta-narrative.
>> Matt
>>
>> On Wed, Oct 1, 2008 at 8:44 AM, Douglas Roberts
>> <[hidden email]> wrote:
>> > On another mailing list that I frequent, there is a small core of
>> > Republicans who *insist* that is was the DemoCRAPS[sic] who caused
>> our
>> > current economic crisis.
>> >
>> > I sent the following message to them yesterday, after finding the
>> nice,
>> > short informative article in Time (link below). I find that it is
>> sometime
>> > necessary to use small words when dealing with political zealots.
>> >
>> > Astonishingly, it was not the DemoCRAPS[sic] who were the cause of
>> our
>> > current financial fuck-up. Read this short article to discover
>> who is
>> > really to blame.
>> >
>> > Can you say, "Risky derivatives trading"? Can you say,
>> "Irresponsible
>> > hedge fund management"?
>> >
>> > I knew you could.
>> >
>> >
>> http://www.time.com/time/business/article/0,8599,1845209,00.html?
>> cnn=yes
>> >
>> >
>> > Me, I'm an independent.
>> >
>> > --Doug
>> >
>> > --
>> > Doug Roberts, RTI International
>> > [hidden email]
>> > [hidden email]
>> > 505-455-7333 - Office
>> > 505-670-8195 - Cell
>> >
>> > On Wed, Oct 1, 2008 at 9:29 AM, glen e. p. ropella
>> <[hidden email]>
>> > wrote:
>> >>
>> >>
>> >>
>> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?
>> _r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin
>> >>
>> >> --
>> >> glen e. p. ropella, 971-219-3846, http://tempusdictum.com
>> >>
>> >>
>> >> ============================================================
>> >> FRIAM Applied Complexity Group listserv
>> >> Meets Fridays 9a-11:30 at cafe at St. John's College
>> >> lectures, archives, unsubscribe, maps at http://www.friam.org
>> >
>> >
>> >
>> >
>> >
>> > ============================================================
>> > FRIAM Applied Complexity Group listserv
>> > Meets Fridays 9a-11:30 at cafe at St. John's College
>> > lectures, archives, unsubscribe, maps at http://www.friam.org
>> >
>>
>> ============================================================
>> FRIAM Applied Complexity Group listserv
>> Meets Fridays 9a-11:30 at cafe at St. John's College
>> lectures, archives, unsubscribe, maps at http://www.friam.org
>
>
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org

"Summer afternoon--summer afternoon; to me, those have always been the
two most beautiful words in the English language."

Henry James

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Peter-2-2

Re: This Economy Does Not Compute

In reply to this post by Kenneth Lloyd

Right on Ken

Thats the major issue --- we inside of the industry understand that the non dynamic non world related models are SIMULATIONS but to most people these are wizard visions of actuality and bluntly our marketing to them fudges this whenever a contract or money comes up.

For example: At a recent seminar for the city of santa fe economic vision each department ( Some 8 in all ) had created there own silo viewpoint on a pdf and associated power point with very little consideration of interaction.and absolutely no multi dimensional viewable interaction, forget about the real world it was not invited.. In my usual smooth understated way I pointed that the last three visions were now gathering dust on someones shelf as a result of the word pdf workflow used and unless they could bring this alive connect it to the real world in a constant way that adapted dynamically to reality it was DOA. Now what looks like to be occurring is a non dynamic political correct sim city YUCK but what they need is dynamic SysBIM on steroids but god love them I guess fiction is more comfortable and no one on our side of the table is telling them the REAL truth

As a similar metaphor its worth noticing that the success of the abacus had nothing to do with technology or ease of use it was so that anyone could watch EXACTLY what the bean counters did, as no one trusted them.

I submit we have a similar problem and need an equivalent example hence the thought on do no evil etc and for that we need to come out of our specialist academic ( It ain't my problem OH is that what you wanted ) silos

( : ( : pete

Peter Baston

IDEAS

www.ideapete.com

Kenneth Lloyd wrote:

Excellent article!

As complexity wonks, most of us understand that static models are woefully
incomplete, and that dynamical systems modeling is one of the precursors to
understanding complexity.  This implies the study of systems at some
distance from equilibrium. 

Hopefully, we can encourage people to join us in the 21st century and adopt
these methodologies.

Just got a FRIAM post: "This economy does not compute."  Perhaps a move from
the deterministic to the stochastic is in order.  Our economy computes, but
in non-analytical ways.  It's complex ... Doh!

Ken

-----Original Message-----
From: [hidden email] 
[[hidden email]] On Behalf Of Matthew Francisco
Sent: Wednesday, October 01, 2008 9:43 AM
To: The Friday Morning Applied Complexity Coffee Group
Subject: Re: [FRIAM] This Economy Does Not Compute

from Rob Axtell:
http://krasnow.blogspot.com/2008/09/goldilocks-on-wall-street.
html#links

On Wed, Oct 1, 2008 at 8:29 AM, glen e. p. ropella 
[hidden email] wrote:

      

http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opi

nion&oref=slogin&oref=slogin&oref=slogin

--
glen e. p. ropella, 971-219-3846, http://tempusdictum.com


============================================================
FRIAM Applied Complexity Group listserv Meets Fridays

9a-11:30 at cafe

at St. John's College lectures, archives, unsubscribe, maps at 
http://www.friam.org

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College 
lectures, archives, unsubscribe, maps at http://www.friam.org

Phil Henshaw-2

Re: This Economy Does Not Compute - and the fix

In reply to this post by glen ep ropella

Another way to say why there is a phase transition to instability there is
that it is inherent in pushing learning tasks to exceed their response
times. Becoming incoherent in response is a kind of system failure that
leads to systems to collapse for any critical part. That is part of that
learning theorem I presented graphically 30 years ago.
http://www.synapse9.com/pub/theInfiniteSoc.pdf

It's now more simply stated as just that the limit of learning is unexpected
complications, an environmental signal you can not include in your plan,
model or theory. It's particularly useful as the corollary that growth
processes will lead to collapse unless the way they are changed by running
into limits is by developing stability instead.

The fix? Learn when to expect complications and how to see them coming.

Phil

> -----Original Message-----
> From: [hidden email] [mailto:[hidden email]] On
> Behalf Of glen e. p. ropella
> Sent: Wednesday, October 01, 2008 11:29 AM
> To: 'The Friday Morning Applied Complexity Coffee Group'
> Subject: [FRIAM] This Economy Does Not Compute
>
>
> http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opin
> ion&oref=slogin&oref=slogin&oref=slogin
>
> --
> glen e. p. ropella, 971-219-3846, http://tempusdictum.com
>
>
> ============================================================
> FRIAM Applied Complexity Group listserv
> Meets Fridays 9a-11:30 at cafe at St. John's College
> lectures, archives, unsubscribe, maps at http://www.friam.org

Phil Henshaw-2

Re: This Economy Does Not Compute - and the fix

In reply to this post by glen ep ropella

Oh yes... how the fix for the need for a "Goldilocks" magic in setting the
price for unmarketable assets. It's very simple. Just use your best
realistic guess. You don't worry about putting the tax payer on the hook
by including the provision that the costs of stabilizing a system brought
down by a tragedy of a commons caused by people excessively profiting from
it, will be born by the people who profited, once it can be decide how to
measure that sometime later...

---
Another way to say why there is a phase transition to instability there is
that it is inherent in pushing learning tasks to exceed their response
times. Becoming incoherent in response is a kind of system failure that
leads to systems to collapse for any critical part. That is part of that
learning theorem I presented graphically 30 years ago.
http://www.synapse9.com/pub/theInfiniteSoc.pdf

It's now more simply stated as just that the limit of learning is unexpected
complications, an environmental signal you can not include in your plan,
model or theory. It's particularly useful as the corollary that growth
processes will lead to collapse unless the way they are changed by running
into limits is by developing stability instead.

The fix? Learn when to expect complications and how to see them coming.

Phil

glen ep ropella

Re: This Economy Does Not Compute

In reply to this post by Peter-2-2

Thus spake peter circa 10/01/2008 10:15 AM:
> but god love them I guess fiction is more comfortable and no one on our
> side of the table is telling them the REAL truth

Careful, there. You're on the cusp of committing a perfect solution
fallacy.

The beauty of reality is that we cannot ever know the REAL truth, much
less tell such truth to someone. At best, we can gather all our
fictions and compare them in an attempt to parallax toward the truth.

--
glen e. p. ropella, 971-219-3846, http://tempusdictum.com

============================================================
FRIAM Applied Complexity Group listserv
Meets Fridays 9a-11:30 at cafe at St. John's College
lectures, archives, unsubscribe, maps at http://www.friam.org

Phil Henshaw-2

Re: This Economy Does Not Compute & Rosen

In reply to this post by Peter-2-2

Peter Baston

Peter,

But wasn’t Ken’s plea for complex stochastic models?? The problem is that the physical system has emergent processes and is not either a linear, non-linear or stochastic projection of the past, either simple or complex. It’s not a projection of the past at all. It’s a divergence from and construction upon the past, by emergent systems never seen before. You can’t directly model that. You can only study that as something that diverges from your models. It seems to me, *that’s* what Rosen is talking about when naming divergent sequences as what prevents science from studying life.

Phil

From: [hidden email] [mailto:[hidden email]] On Behalf Of peter
Sent: Wednesday, October 01, 2008 1:16 PM
To: The Friday Morning Applied Complexity Coffee Group
Cc: [hidden email]
Subject: Re: [FRIAM] This Economy Does Not Compute

Peter Baston

IDEAS

www.ideapete.com

Kenneth Lloyd wrote:

Excellent article!

As complexity wonks, most of us understand that static models are woefully

incomplete, and that dynamical systems modeling is one of the precursors to

understanding complexity.  This implies the study of systems at some

distance from equilibrium.

Hopefully, we can encourage people to join us in the 21st century and adopt

these methodologies.

Just got a FRIAM post: "This economy does not compute."  Perhaps a move from

the deterministic to the stochastic is in order.  Our economy computes, but

in non-analytical ways.  It's complex ... Doh!

Ken

-----Original Message-----

From: [hidden email]

[[hidden email]] On Behalf Of Matthew Francisco

Sent: Wednesday, October 01, 2008 9:43 AM

To: The Friday Morning Applied Complexity Coffee Group

Subject: Re: [FRIAM] This Economy Does Not Compute

from Rob Axtell:

http://krasnow.blogspot.com/2008/09/goldilocks-on-wall-street.

html#links

On Wed, Oct 1, 2008 at 8:29 AM, glen e. p. ropella

[hidden email] wrote:

 
      

http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opi

nion&oref=slogin&oref=slogin&oref=slogin

--

glen e. p. ropella, 971-219-3846, http://tempusdictum.com

============================================================

FRIAM Applied Complexity Group listserv Meets Fridays

9a-11:30 at cafe

at St. John's College lectures, archives, unsubscribe, maps at

http://www.friam.org

============================================================

FRIAM Applied Complexity Group listserv

Meets Fridays 9a-11:30 at cafe at St. John's College

lectures, archives, unsubscribe, maps at http://www.friam.org

Peter-2-2

Re: This Economy Does Not Compute ( Re Democrap is wusnt us )

In reply to this post by Matthew Francisco-2

Actually there is a version of truth in the democrap diatribe but not where the article points

The Glass Siegel act forbade most of the business activities that are the root of many of todays financial issues outside of the modeling muckup.

The man who was instrumental in getting Glass Siegle abolished was Robert Ruben http://www.ustreas.gov/education/history/secretaries/rerubin.shtml under Bill Clinton.

Rubin was Co Chair of Goldman Sachs coincidentally our current secretary Henry Paulson was also a past Chairman.

Now of course we are playing pass the hand grenade blame everyone but moi.

Goldman Sachs will come of of this gangbusters, WOW what a coincidence

Watching how the market is doing its own song and dance today has anyone noticed how the repeal of a simple equation called " Mark to Market " has changed the whole equation and there must be multiple people in the AIG boardroom saying " What the fuck " banging there heads on the wall

The economist did a wonder skit on this http://www.economist.com/finance/displaystory.cfm?story_id=12305786 with Henry becoming the first King Henry of the USA due to the fubar we have

( : ( : pete

Peter Baston

IDEAS

www.ideapete.com

Matthew Francisco wrote:

Doug,
I think it's a poor move to use a model--did the Officers use a model
for their article in Time?--to fix blame with such confidence
especially when the thing to blame is a vague collective identity.
Granted, sometimes it seems that such fixing is needed because we need
to reaffirm our own group identifications especially if they are under
attack or ignored and more so if we are in political season.  The
point of Buchanan's article, I think, is that models are good at
generating alternative narratives about causation in systems where no
single person or group of people can ever know 'the system' and the
experts and stakeholders all see the system in different ways, with
different stories about how the system works.  I think a more
ambitious goal for modeling these systems is bringing together or
overlaying (integrating?) these local stories into a sort of
meta-narrative.
Matt

On Wed, Oct 1, 2008 at 8:44 AM, Douglas Roberts [hidden email] wrote:

On another mailing list that I frequent, there is a small core of
Republicans who *insist* that is was the DemoCRAPS[sic] who caused our
current economic crisis.

I sent the following message to them yesterday, after finding the nice,
short informative article in Time (link below).  I find that it is sometime
necessary to use small words when dealing with political zealots.

Astonishingly, it was not the DemoCRAPS[sic] who were the cause of our
current financial fuck-up.  Read this short article to discover who is
really to blame.

Can you say, "Risky derivatives trading"?   Can you say, "Irresponsible
hedge fund management"?

I knew you could.

http://www.time.com/time/business/article/0,8599,1845209,00.html?cnn=yes


Me, I'm an independent.

--Doug

--
Doug Roberts, RTI International
[hidden email]
[hidden email]
505-455-7333 - Office
505-670-8195 - Cell

On Wed, Oct 1, 2008 at 9:29 AM, glen e. p. ropella [hidden email]
wrote:

http://www.nytimes.com/2008/10/01/opinion/01buchanan.html?_r=3&ref=opinion&oref=slogin&oref=slogin&oref=slogin

--
glen e. p. ropella, 971-219-3846, http://tempusdictum.com


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Owen Densmore

Re: This Economy Does Not Compute

Administrator

In reply to this post by Douglas Roberts-2

Just a quick "Thanks" to Glen, Matthew, and Doug for the great pointers.

-- Owen

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Tom Carter

Troubled (assets relief program) and "certain wooden arrows"

All -

The "Emergency Economic Stabilization Act" passed by the US Senate today, and being moved on to the House, has some interesting characteristics, and contains some (vaguely) amusing elements.

It turns out that the bill is actually an amendment to a bill intended to require equity in the provision of mental health and substance-related disorder benefits under group health plans (and to prohibit discrimination on the basis of genetic information). (The House bill, defeated Monday, was actually an amendment to H.R. 3997, entitled "Heroes Earnings Assistance and Relief Tax Act of 2007," subtitled "Benefits for Military and Volunteer Firefighters" (previously known as the "Defenders of Freedom Tax Relief Act" . . . don't we love Congress? They at least know how to name things! Old joke: we all know that "con" is the opposite of "pro" -- so what does that say about the relationship between congress and progress? :-)

Somehow I find this both charming and disorienting, not least because what started out as a Senate bill designed to facilitate medical and insurance assistance for troubled humans (mental health and substance abuse) has morphed into a bill to help out "troubled assets" instead (see below) . . . :-)

You can see the text of the Senate Bill (to be known as the "Emergency Economic Stabilization Act of 2008", and having as its primary purpose the establishment of the "Troubled Assets Relief Program" - TARP) here, if you want:

http://banking.senate.gov/public/_files/latestversionAYO08C32_xml.pdf

The Senate Bill at least goes a long way toward officially giving up the fiction that the "cause" of the financial markets "meltdown" was "subprime mortgages" (i.e., those pesky homeowners who "borrowed beyond their means"). The Senate Bill would authorize the TARP to "to make and fund commitments to purchase, troubled assets from any financial institution, on such terms and conditions as are determined by the Secretary" where "troubled assets" are "residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages" ("related to" ????), or, more generally, subject to certain minimal restrictions, "any other financial instrument . . . " (umm, right, "any other" -- in other words, stuff having nothing at all to do with "supbrime mortgages"). Subprime mortgages amount to perhaps $1.3 trillion (10^12) (and far from all of these are actually "troubled," of course), dwarfed by these "other financial instruments" that include, for example, the $62 trillion of credit default swaps (CDS) -- and even those are but a small part of the $450 trillion "financial derivatives" market, whose explosion was facilitated by wide-ranging deregulation of the financial markets in the 1990s and 2000s.

If you'd like to learn more about the "real causes" of the current financial crisis, I recommend that you read this essay, published last spring in the London Review of Books (it has the charming title "End-of-the-World Trade"):

http://www.lrb.co.uk/v30/n09/mack01_.html

I must say that my favorite part of the Senate Bill is Sec. 503: "Exemption from excise tax for certain wooden arrows designed for use by children" (see page 300 of the Bill . . .). I am absolutely not making this up!!!! But anyway, thanks to the Senate, at least now we can be assured that "the children" (as we affectionately call those who will be inheriting this mess . . .) will have at least a chance of being prepared for life after "the end of civilization as we know it." . . . Thank goodness the House defeated their Bill -- it didn't have this provision! :-)

I'm also (somewhat) thankful that the Senate has retained most of the original content of the Bill, in the form of Subtitle B— the "Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008." It would assure that if this whole thing drives me crazy, or leads me to drown my sorrows in drink or to try to escape into drugs, at least it won't be any harder for me to get my insurance to pay for mental health or substance abuse treatment than for any other medical treatment (it won't make it any easier, though, and of course it doesn't commit one penny of the $700,000,000,000 in "rescue funds" to helping Americans without medical insurance get any health coverage at all . . .).

All in all, I guess I'd have to say that it certainly restores my confidence in America to know that the Senate cares enough, to be sure to exempt "certain wooden arrows designed for use by children" from the excise tax . . . :-) :-) :-) . . . no, wait . . . :-(

tom

p.s. I read in the San Francisco Chronicle this morning that "This is not about a bailout of Wall Street. This is about doing something to ensure confidence in the American Economy." Oh. I get it. This is all a big "confidence exercise." I've done some studying of von Neumann and Morgenstern's mathematical Game Theory, and there are a variety of standard "game theory" examples: a "prisoners' dilemma game," a "hawk-dove game," a "stag-hunt game," a "dictator game," an "ultimatum game" . . . I suppose this one would have to be called an example of a "confidence game" (or, for short, a "con game" . . . :-) .

Paul Paryski

Re: Troubled (assets relief program) and "certain wooden arrows"

Ah as the Rolling Stones sang, "What's a poor boy to do?" Paul

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