Wrapping Galactica

It's an uneven ending to a great show, but then again as any writer will tell you, Endings Are Hard. On the bad side: Forty thousand engineers, pilots and assorted technicaly sophisticated people suddenly decide to ditch all technology and go wandering off into the lion infested veldt with the clothes on their backs. They condemn themselves and their children to starvation, disease and a 30-year life expectancy so that one of their skeletons can be found 150,000 years later. It's a shame that the writers decided that the only way to say goodbye was for everyone to become stupid.

Other than that, I really enjoyed the end of a great, groundbreaking show. Everyone got their moment in the spotlight, even if it didn't always make sense.

As usual, Television Without Pity has the best review of this mishegas.

The Excellent: The Kara/Lee flashback continued to be tonally perfect, both subtle and fraught with meaning, and the story brought both characters to elegant and moving conclusions. Anything involving Caprica and Gaius (or their analogues) was superb in its writing and execution, and I find I'm still finding more and more reasons to love them after the fact -- which, if you think about it, might be the show's highest triumph. The depth and scope of Ellen Tigh's story offscreen, those two kids did right in front of us over the past six years, coming to a place of compassion and empathy no one could have predicted. And of course the Twins, the Drunks and the Roslin/Adama Administration are six more stories I'd be proud to tell, if my skills were equal to the task. Thank God the show was, and is.

The Good: Great actors can make anything work, so you're treated to the usual lapidary performances (between the hour-long onslaught of shit blowing up followed by the hour-long onslaught of weird Prime Directive patronizing weirdness in the veldts of Tanzania). The truth of the Opera House was beautiful in its way, and the mysteries of Kara and the angels were left appropriately mysterious. (Which is not to say vague, but just to say the whole point of stuff we don't have words for is that we don't have words for it: try to put words to it and you end up with Pah Wraiths, so that's at least one lesson learned.) Taken as a whole, despite the draggy finale's execution, the narrative journeys of Laura and Bill and Saul are benchmarks of characterization, and that's as present here as it's been every other week.

Also Good: Boomer's arc feels complete, in that she accepts both the up and down sides of free will, which are pretty much her whole deal, and dies willingly to exercise both at once. Tory never had an arc beyond being the whipping girl for the entire cast and writing staff, so her end was at least appropriate (although it would have been just as easy -- and thematically superior -- to shift her down to the sickbay with Laura working triage and have her die there, which is basically the same chance Felix got with Gaius). And Chief's arc ended with Hotdog's sperm just as much as Athena and Helo this season became automatons randomly shouting HERA every fifteen seconds on the dot, so their fizzled endings seem just as clean. I can almost see it as a shifting focus throughout the show: S1 was pretty much about Boomer, Athena and Helo proportionally, so they've had their parts of the story already. I can handle that, I guess.

Elsewhere on teh Interwebs:

Ronald Moore post-Daybreak Q&A in which All is Explained

NJ.com Daybreak Review

Galactica at the UN

Update: I feel like I was a little too harsh in my review. I think that overall, this Galactica was one of the great science fiction series of all time, due to its emphasis on the political/moral dimension, and the genuinely extraordinary level of writing and acting. As Grant Morrison used to say, you think that it's the action that you're interested in, and that's fun, but you're really invested in the soap opera of the characters' lives. This is what made the series so great, and the final episode so satisfying in many ways: you got to see the characters' arcs come to a satisfactory conclusion.

Update 2: Kevin Kelly discusses life without technology and the advent of language 50,000 years ago.

New Plan Same as the Old Plan

Geithner's "revised" plan is getting bad reviews, because it's essentially nonresponsive to the actual problem: a bunch of banks made bad bets, and now hold damaged assets. As Krugman puts it, the plan would have worked if all we had was a market jammed up by panicked selling, but it wastes a trillion dollars if the assets are really correctly valued.

VoxEU lays out the way it should be done.

Meanwhile, Corzine gets on board with the Swedish method.

41 Shades of Google Blue

The tension between Curation and Data Analysis as played out at Google.

Grant Morrison's Sexy Apocalypse

Grant Morrison talks with Wired about the thirty (!) ongoing projects he's starting, working on, or just finished, the indestructability of the Superman story itself, and the importance of weird physics theories to art.

Morrison: Final Crisis was much heavier, much harder to write than The Filth, which at least came with massive doses of surreal black humor to sweeten the bitter pill of the subject matter. On Final Crisis, I spent months immersing myself in the thought processes of an evil, dying God who longed for nothing less than the degradation, destruction and enslavement of all of DC's superheroes, along with every other living thing in the universe and beyond!

To get into his head, I had to consider people like him in the real world and there were no shortage of candidates. The emissaries of Darkseid seemed to be everywhere, intent on crushing hope, or shattering human self-esteem. I began to hear his voice in every magazine headline accusing some poor young girl of being too fat or too thin. Darkseid was there in the newscasters screaming financial disaster and planet-doom. It was that sick old bastard's voice terrifying children with his hopeless message of a canceled future, demanding old ladies turn off their electric blankets to help "save the planet," while turning a blind eye to corporate ecocide.

Up against that, all we had to offer were the wise words of Pico Della Mirandola and Superman singing a song to break your heart. I had to grind America's superheroes down so hard there was nothing left but diamond in the dark. Everything was falling into a black hole, even the story structure ... and fans on message boards were going to war over the thing, screaming "genius" and "gibberish" at one another. It was quite unpleasant to be at the heart of all that but also strangely exhilarating.

I like Final Crisis a lot now that it's all over. I think it's the closest I've come to creating the type of DC superhero comic I most want to read.

Wired.com: Like continuity, is crisis itself becoming obsolete? Disaster scenarios seem to just get heavier and more mind-blowing, but they also are becoming more ubiquitous. Are we too inured to apocalypse and crisis these days to be scared of it anymore?

Morrison: I don't know if we're so much inured to apocalypse as almost sexually obsessed by it. We could only love apocalypse more if it had 4 liters of silicone in each tit. Think of all those videogames where the Earth's overrun by insect-aliens or there's been an atomic war and we're stumbling in the ruins with a gun we stole from a zombie. We should be grateful that we live in a culture so insulated from true horror it can afford to play with fear as entertainment.

Infinite in All Directions

Over the past few months, I've kept returning to Stuart Kauffman's answer to John Brockman's question for 2009: "What will change everything?" It's possibly the most interesting essay I've read all year*.

Kauffman says that the most important thing to know is that we have no way of knowing what is going to happen. The universe is open.

the evolution of the biosphere, the economy, our human culture and perhaps aspects of the abiotic world, stand partially free of physical law and are not entailed by fundamental physics. The universe is open.

Many physicists now doubt the adequacy of reductionism, including Philip Anderson, and Robert Laughlin. Laughlin argues for laws of organization that need not derive from the fundamental laws of physics. I give one example. Consider a sufficiently diverse collection of molecular species, such as peptides, RNA, or small molecules, that can undergo reactions and are also candidates to catalyze those very reactions. It can be shown analytically that at a sufficient diversity of molecular species and reactions, so many of these reactions are expected to be catalyzed by members of the system that a giant catalyzed reaction network arises that is collectively autocatalytic. It reproduces itself.

The central point about the autocatalytic set theory is that it is a mathematical theory, not reducible to the laws of physics, even if any specific instantiation of it requires actual physical "stuff". It is a law of organization that may play a role in the origin of life.

Consider next the number of proteins with 200 amino acids: 20 to the 200th power. Were the 10 to the 80th particles in the known universe doing nothing but making proteins length 200 on the Planck time scale, and the universe is some 10 to the 17th seconds old, it would require 10 to the 39th lifetimes of the universe to make all possible proteins length 200 just once. But this means that, above the level of atoms, the universe is on a unique trajectory. It is vastly non-ergodic. Then we will never make all complex molecules, organs, organisms, or social systems.

In this second sense, the universe is indefinitely open "upward" in complexity.

Consider the human heart, which evolved in the non-ergodic universe. I claim the physicist can neither deduce nor simulate the evolutionary becoming of the heart. Simulation, given all the quantum throws of the dice, for example cosmic rays from somewhere mutating genes, seems out of the question. And were such infinitely or vastly many simulations carried out there would be no way to confirm which one captured the evolution of this biosphere.

Suppose we asked Darwin the function of the heart. "Pumping blood" is his brief reply. But there is more. Darwin noted that features of an organism of no selective use in the current environment might be selected in a different environment. These are called Darwinian "preadaptations" or "exaptations". Here is an example: Some fish have swim bladders, partially filled with air and partially with water, that adjust neutral bouyancy in the water column. They arose from lung fish. Water got into the lungs of some fish, and now there was a sac partially filled with air, partially filled with water, poised to become a swim bladder. Three questions arise: Did a new function arise in the biosphere? Yes, neutral bouyancy in the water column. Did it have cascading consequences for the evolution of the biosphere? Yes, new species, proteins and so forth.

Now comes the essential third question: Do you think you could say ahead of time all the possible Darwinian preadaptations of all organisms alive now, or just for humans? We all seem to agree that the answer is a clear "No". Pause. We cannot say ahead of time what the possible preadaptations are. As in the first paragraph, we really do not know what will happen. Part of the problem seems to be that we cannot prespecify all possible selective environments. How would we know we had succeeded? Nor can we prespecify the feature(s) of one or several organisms that might become preadaptations.

Then we can make no probability statement about such preadaptations: We do not know the space of possibilities, the sample space, so can construct no probability measure.

Can we have a natural law that describes the evolution of the swim bladder? If a natural law is a compact description available beforehand, the answer seems a clear No. But then it is not true that the unfolding of the universe is entirely describable by natural law. This contradicts our views since Descartes, Galileo and Newton. The unfolding of the universe seems to be partially lawless. In its place is a radically creative becoming.

Let me point to the Adjacent Possible of the biosphere. Once there were lung fish, swim bladders were in the Adjacent Possible of the biosphere. Before there were multicelled organisms, the swim bladder was not in the Adjacent Possible of the biosphere. Something wonderful is happening right in front of us: When the swim bladder arose it was of selective advantage in its context. It changed what was Actual in the biosphere, which in turn created a new Adjacent Possible of the biosphere. The biosphere self consistently co-constructs itself into its every changing, unstatable Adjacent Possible.

If the becoming of the swim bladder is partially lawless, it certainly is not entailed by the fundamental laws of physics, so cannot be deduced from physics. Then its existence in the non-ergodic universe requires an explanation that cannot be had by that missing entailment. The universe is open.

Part of the explanation rests in the fact that life seems to be evolving ever more positive sum games. As organismic diversity increases, and the "features" per organism increase, there are more ways for selection to select for mutualisms that become the conditions of joint existence in the universe. The humming bird, sticking her beak in the flower for nectar, rubs pollen off the flower, flies to a next flower for nectar, and pollen rubs off on the stamen of the next flower, pollinating the flower. But these mutualistic features are the very conditions of one another's existence in the open universe. The biosphere is rife with mutualisms. In biologist Scott Gilbert's fine phrase, these are codependent origination—an ancient Buddhist phrase. In this open universe, beyond entailment by fundamental physics, we have partial lawlessness, ceaseless creativity, and forever co-dependent origination that changes the Actual and the ever new Adjacent Possible we ceaselessly self-consistently co-construct. More, the way this unfolds is neither fully lawful, nor is it random. We need to re-envision ourselves and the universe.

*and so I will overquote practically the whole thing in the interest of having it in the archive.

Some Truths about Gitmo

...that you probably already knew. Lawrence Wilkerson describes the political fight over the detainees at Guantanamo Bay in the Washington Note, and some other truths about Dick Cheney on the Rachel Maddow Show:

Visit msnbc.com for Breaking News, World News, and News about the Economy

Now can we have war crimes trials?

Rachel Maddow interviews Chad Lindsey

Subway rescuer Chad Lindsey describes his moment of coolness under pressure.

Risk Fundamentalism

Mark Thoma says that the Fed needs to more actively manage the price of risk, and that those who oppose this are (I think) relying on market fundamentalisms. He quotes Christopher Carroll's post on this extensively:

Christopher Carroll with an evidence based rebuttal to the "risk-is-holy view" advocating a free market, hands off approach to the financial crisis, and a call for the Fed to do what it always does in a crisis, manage the price of risk (which means going beyond measures such as the purchase of long-term government securities and taking risky assets onto the Fed's balance sheet):

Punter of last resort, Christopher D. Carroll, Vox EU: The financial meltdown that shifted into high gear last September has flushed into public view many surprising facts. One of the strangest is the existence, in the economics profession, of a bizarre religious cult. This cult adheres to the dogma that the “price of risk” is the Holy of Holies that can properly be set only by the immaculate invisible hand of the financial marketplace; and cult members seem to believe, to paraphrase President Lincoln from a rather different context, that “If the Market wills that the economic crisis continue until every dollar of economic activity created by the taking of risk shall be repaid by another dollar destroyed by a newfound fear of risk, so it still must be said that the judgments of the Market are true and righteous altogether.”

The deep origins of the cult, as always, are obscure; presumably they lie properly in the field of psychoanalysis. But to the extent that overt origins can be traced, the wellspring is the literature that attempts to explain the Mehra and Prescott (1985) ‘equity premium puzzle.’ The ‘puzzle,’ in a nutshell, is that asset prices have not, historically, exhibited a relationship between risk and return that is easy to reconcile with the rational behavior of a representative agent facing perfect markets. Many of the responses to this challenge start with the assumption that asset prices must be always and everywhere rational, and then proceed to work out the kind of preferences or environment that can rationalize observed prices. This game brings to mind Joan Robinson’s comment that “utility maximization is a metaphysical concept of impregnable circularity,” and Larry Summers’s remark (quoted by Robert Waldmann) that the day when economists first started to think that asset prices should be explained by the characteristics of a representative agent’s utility function was not a particularly good day for economic science. Oddly, even the failure of this literature to produce a widely agreed solution to the ‘puzzle’ does not seem to have weakened participants’ belief in the soundness of the intellectual framework within which asset prices are a puzzle.

Nor does the assumption that asset prices are always and everywhere perfect reflect the actual past practice of economic policymaking during crises. As DeLong (2008) has recently reminded those of us who are susceptible to the lessons of history (see also Kindleberger (2005)), the “lender of last resort” role of the central bank has always been, during a panic, to short-circuit the catastrophic economic effects of a collapse of financial confidence (in today’s terminology, ‘an increase in the price of risk’).1

Some economists, of course, view narrative history in the DeLong and Kindleberger mode as irrelevant to the practice of their science; they prefer hard numbers to mere narrative. For the numerically inclined, however, Figures 1a and 1b should be persuasive; they show that controlling a market price of risk is something the Federal Reserve has done since it first opened up shop. The top figure depicts a measure of what we are now pleased to call the ‘risk-free’ rate of interest in the United States – essentially, the shortest-term interbank lending rate for which data are available (on a consistent basis) from before and after the founding of the Fed.2 Figure 1b shows the month-to-month changes in this interest rate. The only reason this rate is now viewed as ‘risk-free’ is that the Fed takes away the risk.3

...Let’s put it this way: Simple calculations show that the current price of risk as measured by corporate bond spreads amounts to a forecast that about 40 percent of corporate America will be in bond default in the near future.5 The only circumstance under which this is remotely plausible is if government officials turn these dire forecasts into a self-fulfilling prophecy by failing to intervene forcefully in a way that quells the existential terror currently afflicting the markets. While I realize that some economists (and some politicians) might be willing even to undergo another Great Depression as the steep price of clinging to their faith, those of us who do not share that faith should not have to suffer such appalling consequences.

Of particular interest are the interest rate charts showing monthly interest rates before the advent of central banking. These make a pretty good argument in favor of quantitative easing strategies as part of a recovery policy.

Karim Rashid at Home

Karim Rashid lives in a loft with his wife, a collection of 5,000 design objects, 2,000 CDs and a pink suit. 90% of the rest of the apartment consists of things he's designed (by weight, if not by number). The floors are made of Lonseal rubber, the windows face south to get the sun all day, and he lives in hotels 230 days out of the year.

Dave McKean Interview

7 impossible things interviews Dave McKean. Lots of excellent samples of his work, and some interesting insights into his work.

(via Neil)

US Tortures, Says Red Cross

Now can we have war crimes prosecutions?

Hidden Room

Grimace finds a hidden room in his country house.

A few years ago I was living in this really old place in the countryside, after I had moved in I noticed one day some light shining through a tiny hole at the back of my wardrobe. I was curious, and found that one of the panels at the back of the wardrobe could be unscrewed. So I unscrewed it and found a hidden room, complete with little beds, drawers and wardobes.

I would say it was for little children - perhaps illegitimate children... it looked like it hadn't been disturbed for a very long time. There was some newspapers from the 50s.

(via Warren)

Don't "Keep Calm and Carry On"

A slogan for the economic wars from Matt Jones.

(via Warren)

River Walk

Another example of nicely decayed local public spaces, along the Scioto River.

Quote of the Day

“ The task of an American writer is not to describe the misgivings of a woman taken in adultery as she looks out of a window at the rain, but to describe four hundred people under the lights reaching for a foul ball. This is ceremony. "

-John Cheever

(via 1001 Rules for My Unborn Son)

Tales from the Meltdown: AIG as Shadow Banking Reinsurance

Gillian Tett, Brad Setser and Mark Thoma note the following in a nested set of articles: “Concretations of risk, plagued with deadly correlations”

One of the selling points of financial innovation was that it would distribute risk widely thereby insulating the the financial sector from large shocks. Everyone would take a small loss, but no loss would be large enough to cause any real difficulties. That turned out to be a false promise in the face of a large, systemic shock. As problems began developing in these markets, it became evident that risk was far more concentrated than the promoters of new financial products had claimed.

Hypercosmic God

Bernard d'Espagnat won this year's Templeton Prize for his discussion of the non-local reality underlying quantum mechanical observations:

Unlike classical physics, d'Espagnat explained, quantum mechanics cannot describe the world as it really is, it can merely make predictions for the outcomes of our observations. If we want to believe, as Einstein did, that there is a reality independent of our observations, then this reality can either be knowable, unknowable or veiled. D'Espagnat subscribes to the third view. Through science, he says, we can glimpse some basic structures of the reality beneath the veil, but much of it remains an infinite, eternal mystery...

"There must exist, beyond mere appearances … a 'veiled reality' that science does not describe but only glimpses uncertainly. In turn, contrary to those who claim that matter is the only reality, the possibility that other means, including spirituality, may also provide a window on ultimate reality cannot be ruled out, even by cogent scientific arguments."

Simple questions aren't.

13 Sentences for Startups

Paul Graham started with advice from Paul Buchheit: "it's better to make a few people really happy than a lot of people semi-happy," and ended with "understand your users," as the most important advice. In between, he developed a set of 11 other things that are crucial for running a startup. My favorite is "get ramen profitable".

"Ramen profitable" means a startup makes just enough to pay the founders' living expenses. It's not rapid prototyping for business models (though it can be), but more a way of hacking the investment process. Once you cross over into ramen profitable, it completely changes your relationship with investors. It's also great for morale.

(via lonegunman)

Super-Autobiographical Memory

Bob Petrella is the 4th person identified with "super-autobiographical memory", which enables almost perfect, date-stamped recall of episodic memory. It is curious that this form of exceptional memory is distinct from photographic or eidetic memory recall, in that it does not include perfect procedural or factual recall. There also appears to be some degree of interference from the recalled memories, which take up some attentional space, if not storage capacity.

Doctors are just beginning to observe, let alone understand, this phenomenon.

"First, three of our four top subjects are left-handed, and our fourth has strong tendencies to be left-handed [but] uses a right hand in writing," said McGaugh. "They all have slightly obsessive tendencies. They save a lot of things. They keep a lot of things. Salvation Army will never get rich off these people because they keep it, and so they covet collections the way they covet their memories. We find that interesting."

Also, it turns out certain parts of the super-autobiographical memory subjects' brains are larger than they are in people who don't have super-autobiographical memory. Also, their potential to store information appears infinite.

"There's no capacity limitation on what we can learn," said McGaugh, "no limit to our capacity to learn."

The CEO Test

Adam Bryant interviews Greg Brenneman of CCMP Capital. Brenneman has several very good points on leadership and management. Boiled down, they are:

1. Pick the 2 or 3 most important levers that will give you the maximum impact without overload
2. Good business plan: divide a page in quadrants (Market, Financial, Product, People)
3. Be brief:

   There’s a great saying: “I didn’t have time to write a short letter, so I wrote a long one instead.” I find that in business a lot people take the time to write the really long letter, but they don’t take time to write the short one, and it even applies to doing investments.
   
   When one of our guys is presenting an investment, you always kind of know they have it if they can explain it very quickly. And if it takes a really long time and you’re into the square root of the price of oil in Uzbekistan, you probably know that it’s gotten too complicated, and that’s when I start asking questions — when people start having trouble simply saying, “Here’s the idea.”



4. Be on time.


5. Start on time, end on time. Move meetings along.


6. Respond promptly: “It takes you just as long to respond quickly as it does slowly. It’s not a time management thing for you.”

Quote of the Day

"News is what somebody somewhere wants to suppress; all the rest is advertising. "

-Lord Northcliffe

(from Siege)

Debunking Shlaes

I'll admit: historians have it hard. If they want to hit the big time, they've got to come up with a new angle on old material ("He's the Founding Father you've never heard of!"). This has led to a lot of questionable scholarship in search of a dissertation or New York Times bestseller, but Amity Shlaes has taken it to a whole new level: she just makes stuff up. Like: FDR caused the Great Depression, years before he took office. This stuff shows up on Fox News, and the next thing you know, I have to deliver a half hour lecture on basic macroeconomics, political science and mid-20th century history to people who send me emails pasted from a Drudge column. The hits just keep rolling, too.

Here's Devilstower on the Daily Kos, taking apart her latest effort:

Shlaes' book on the economy during the 1930s has been roundly debunked on every point by multiple economists, including Paul Krugman. However, Shlaes refuses to admit error. Instead, whenever she is caught weaving conservative fantasies, she takes a page from the "Intelligent Design" movement and challenges the latest person to tear through her disinformation to "a debate over the New Deal." Shlaes is smart enough to know that her book can't stand up to detailed review, but that a publicized show down would only boost her sales. In other words, she knows she's lying, but she's profiting from the lies, so why stop?

After all, her alternate history novel for conservatives has gotten her writing gigs from the Wall Street Journal, the Washington Post, and praise from such luminaries as Glenn Beck. No doubt Amity Shlaes is surrounding us. And just this past week, the public radio program Marketplace invited Ms. Shlaes to give the commentary. In it, she raised the stakes on the wing nut rebellion to a whole new level.

Taxation without representation, that's what our nation's founders rebelled against. ... The course of US history can be seen as progress by those who are taxed to get representation.... Along the way we began to pay out money to people who paid no income tax at all. There's Medicare of course for senior citizens, even if they never worked, welfare for the poor and struggling, at least through the 90s, and more recently there's the earned income tax credit -- a break for low income workers. The credit was designed to make people want to work, and to offset their heavy pension payments for Social Security. The result of expanding it, however, is that many people who work don't pay income tax, instead they get money back. Do we want to help weaker citizens, especially in a downturn? Totally. ... But a tipping point does come, when too many are paying out, and too few are paying in. Maybe that tipping point is now. Today households in the bottom half of earners pays less than 4% of income taxes. One tiny group, the top one percent, pays close to 40%. This can slow the economic recovery we're waiting for. Top earners won't want to keep producing if their burden gets much heavier. ... The mood of the skeptics today is just the reverse of the mood at the Boston Tea Party. Then we said no taxation without representation. Try reversing that line. No representation without taxation.

In this little commentary, Shlaes naturally applies the standard conservative idiocy test. Yes, the top one percent pay thirty-some percent of the income tax. That's because the top one percent have thirty-some percent of the wealth. (It's worth noting that the top 1% is provided enough tax loopholes and kickbacks that the amount they pay is almost exactly what they would be paying if we had a flat tax evenly applied at all levels.) It's also not difficult to understand how the bottom half of the population on an income basis pays a small percentage of the total income tax -- the bottom 80% of the income distribution controls only 16% of the wealth. In short, Shlaes' numbers here are no better than her numbers anywhere else.

Then there's the "Going Galt" threat, the part where she says "Top earners won't want to keep producing if their burden gets much heavier." You mean I only get to keep $9.7m when I would have taken home $10m? Why, it's hardly worth getting up in the morning. Point one: the Laffer Curve is less believable than unicorns. Point two: the horrible burden now looming for the top earners is exactly the same tax rate that they faced back in the fast-growing economy of the 1990s.

Then there's the outrage that some elderly people get Medicaid even if they didn't work! Horrors. And the oh so heavy burden of Social Security. But that, all of that, is only standard right wing manure. Even Twinkies can't be eaten when they're that stale.

Bad News from the Business Cycle

Calculated Risk and Econbrowser plot the course of the crisis. It doesn't look good.

Stewart vs. Cramer

How is it that a commedian is virtually the only person on TV who delivers real investigative journalism? Here's proof that a person of reasonable education and intelligence can actually help provide insight on important matters for the American public.

In these clips, Jon Stewart takes CNBC's Jim Cramer to task for the infotainment that allowed investors to remain ill-informed about the nonsense going on at the big banks, markets and funds.

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 2

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 2

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 3

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Kutiman

YouTube mashup grooves
Mother of all Funk Chords


I'm New

Calvin & Hobbes Grow Up

Gerry Canavan collects some of the best-of-the-Internet renditions of post-comic strip Calvin & Hobbes. The effects range from the uplifting to the poignant. The image above, by Sora on Deviantart is particularly cool.

Before there was Buffy, Calvin & Hobbes was pop culture for the cognoscenti.

Eric Lewis "Going Under"

Slamming performance

The Antwerp Diamond Heist

Leonardo Notobartolo orchestrated the largest diamond heist in history. The story reads like a movie script:

When he had stolen goods to sell, he dealt with only a few trusted buyers. Now, as he finished his espresso, one of them—a Jewish dealer—came in and sat down to chat.

"Actually, I want to talk to you about something a little unusual," the dealer said casually. "Maybe we could walk a little?"

They headed out, and once they were clear of the district, the dealer picked up the conversation. His tone had changed however. The casualness was gone.

"I'd like to hire you for a robbery," he said. "A big robbery."

Dick Cheney's Assassination Squads

Before the Inauguration, Seymour Hersh said that the phone would start ringing on January 21st of this year. I guess it did:

At a “Great Conversations” event at the University of Minnesota last night, legendary investigative reporter Seymour Hersh may have made a little more news than he intended by talking about new alleged instances of domestic spying by the CIA, and about an ongoing covert military operation that he called an “executive assassination ring.”

At the end of one answer by Hersh about how these things tend to happen, Jacobs asked: “And do they continue to happen to this day?”

Replied Hersh:

“Yuh. After 9/11, I haven’t written about this yet, but the Central Intelligence Agency was very deeply involved in domestic activities against people they thought to be enemies of the state. Without any legal authority for it. They haven’t been called on it yet. That does happen.

"Right now, today, there was a story in the New York Times that if you read it carefully mentioned something known as the Joint Special Operations Command -- JSOC it’s called. It is a special wing of our special operations community that is set up independently. They do not report to anybody, except in the Bush-Cheney days, they reported directly to the Cheney office. They did not report to the chairman of the joint chiefs of staff or to Mr. [Robert] Gates, the secretary of defense. They reported directly to him. ...

"Congress has no oversight of it. It’s an executive assassination ring essentially, and it’s been going on and on and on. Just today in the Times there was a story that its leaders, a three star admiral named [William H.] McRaven, ordered a stop to it because there were so many collateral deaths.

"Under President Bush’s authority, they’ve been going into countries, not talking to the ambassador or the CIA station chief, and finding people on a list and executing them and leaving. That’s been going on, in the name of all of us.

"It’s complicated because the guys doing it are not murderers, and yet they are committing what we would normally call murder. It’s a very complicated issue. Because they are young men that went into the Special Forces. The Delta Forces you’ve heard about. Navy Seal teams. Highly specialized.

"In many cases, they were the best and the brightest. Really, no exaggerations. Really fine guys that went in to do the kind of necessary jobs that they think you need to do to protect America. And then they find themselves torturing people.

"I’ve had people say to me -- five years ago, I had one say: ‘What do you call it when you interrogate somebody and you leave them bleeding and they don’t get any medical committee and two days later he dies. Is that murder? What happens if I get before a committee?’

"But they’re not gonna get before a committee.”

This book is going to be an eye-popper.

Theory of Mind

From a Wired article where participants are MRI'd while responding to questions about God:

Taken together, the neurological states evoked by the questions are known to cognitive scientists as the Theory of Mind: They underlie our understanding that other people have minds, thoughts and feelings.

The advantages of a Theory of Mind are clear. People who lack one are considered developmentally challenged, even disabled. Anthropologist Scott Atran, a proponent of the byproduct hypothesis, has suggested that it let our ancestors quickly distinguish between friends and enemies. And once humans were able to imagine someone who wasn't physically present, supernatural beliefs soon followed.

But just as a Theory of Mind provided benefits, so might its supernatural byproducts and the religions that grew from them.

Unlike other animals, humans can imagine the future, including their own death. The hope given by religious beliefs to people confronting their own mortality might provide motivation to care for their offspring.

Supernatural beliefs may also have produced group-level advantages that then conferred benefits to individuals.

"You get some selective advantages, such as inter-group cooperation and self-policing morality," said Barrett. "And maybe the entire network of belief practices, and whatever is behind them, gets reinforced."

According to Barrett, religion may even have created a feedback loop, refining the Theory of Mind that produced it.

"It could be that when you're in a religious community, it improves what psychologists call perspective-taking," he said. "Exercising your Theory of Mind could be good for developing it, making your reasoning more robust."

The human capability to develop Theory of Mind is one of the more interesting abilities, along with the mental Time Machine, which allows us to imagine sequences of events that have not happened, or which might happen in the past. Supposedly, it's impossible or very difficult to estimate how we will feel about something at a future time (e.g., what would you like for breakfast on this day next year); we end up thinking of how we feel at the present time (what you actually like for breakfast now), rather doing the timeshift first and comparing the difference.

Aaron Koblin's Airspace Modeling

Tracery of all aircraft in US airspace for a 24 hour period on August 12, 2008.

Quote of the Day

"The audacity of Bolano's fiction, its disregard for convention and even probability, puts me in mind of a remark a friend once made after a jazz concert. I said I thought the keyboard player had really been taking chances, and he said, "No, he wasn't taking chances, he was doing whatever the fuck he wanted." In every sentence he wrote, every image he conceived, every compositional choice he made, Bolano did whatever the fuck he wanted."

-William Deresiewicz on Roberto Bolano's novel 2666

(via 3quarks)

Smart Grids

Lynne Kiesling is gearing up for a mega-lecture on next generation smart utility grids. This technology is going to be one of the medium term drivers of the new green economy, because it is able to adapt to the diffuse manufacture and delivery of energy required by the green energy revolution.

What is the definition of smart grid, and what are its most important and relevant features? I encourage you to think of smart grid from two different directions simultaneously — its technologies and its functionalities. Technologically, a smart grid is a digital communication overlay and integration into the electric power network. This communication technology includes

* Digital switching networks
* Remote sensing and monitoring in wires and in transformers
* Fault detection
* Devices for automated fault repair
* Intelligent end-use devices in homes, stores, office buildings, garages, and factories.

These various smart grid technologies enable a variety of functionalities in the electric power network, such as

* Transactive coordination of the system (many of the following functionalities contribute to this coordination)
* Distributed resource interconnection, including renewable generation
* The ability of a resource/agent to be either a producer or consumer of electricity, or both
* Demand response to dynamic pricing
* The ability of an agent to program end-use devices to respond autonomously to price signals
* Distribution system automation by the wires company, leading to better service reliability

The integration of these technologies into the electric power network will embed distributed intelligence in the systems that the network comprises.

(via mr)

Sweet, William

A newly-identified portrait of William Shakespeare, believed to be the only one painted while he was alive. Originally owned by the Earl of Southampton, Shakespeare's patron, it has been owned by the Cobbe family for the past 300 years.

Tales from the Meltdown: Geithner - Gone by June

Here, in two minutes, Chris Whalen of Institutional Risk Analytics lays out the plan that the Administration has been unable to articulate in six weeks.

Quote of the Day

“ Sex makes people free, therefore, we need to make people ashamed of sex so that even in freedom they’re slaves."

-Siege

Library Porn

Photo: Curious Expeditions
The Philosophical Reading Room of the Szabo Ervin Library, Budapest.


Photo: Marginal Revolution
Reading Room of the Stockholm Public Library, Stockholm.

50 Reasons to Reject Evolution

50 Reasons to Reject Evolution:

11.) Because I think the word “theory” actually means: “random stabs in the dark” when it really means: "an explanation of certain phenomena that is well-supported by a large body of facts and often unifies other similarly well-supported hypotheses" i.e. atomic theory, gravitational theory, germ theory, cell theory, some-people-are-dumb-motherfuckers-theory, etc.

12.) Because the fact that science is self-correcting annoys me. Most of my other beliefs are rigidly fixed and uncorrectable.

25.) Because I don’t realize that saying “microevolution is possible but macroevolution isn’t” is as stupid as saying “I can pick my nose for one second but I cannot pick it for 10 seconds.”

(via Pharyngula)

Brian Eno's School Days

From a Lester Bangs interview:

"I'll tell you the projects we had the first semester. You must realize that this is a real naïve bunch of students, all fifteen or sixteen, that come in with paint boxes thinking that they were gonna do Renoirs or something like that. I was involved by pure accident: it was the nearest art school. In fact, if I could have done, I would have gone to another one that I couldn't get a grant for. This was just a crummy little place in a little country town, and this bunch of students all from the country, and all with ideas about the nice paintings they'd be doing.

"On our second day there, our first drawing exercise was to make a visual comparison between a venetian blind and a hot water tap. It was meant to be in terms of how they functioned, not in terms of how they looked. And this boggled everyone.

"And then the first main project was that the students were put in pairs, and each pair of students had to invent a game, the function of which was to make some kind of psychological behavioral evaluation of people who played it. So they weren't necessarily competitive games, they were games that involved making a decision rather than a number of others, and then extrapolating things about people's personalities on the basis of those decisions. I think there were thirty students altogether, so there were fifteen games made. They varied through all sorts of things: mine was a kind of board game, others were whole rooms that you went through and did various things in. Anyway, all the students went through this, and consequently each student ended up with fifteen so-called character profiles. From those character profiles you had to make what was called a Mind Map, which was a kind of diagrammatic scheme of how you tended to behave in lots of different situations, and then the next part of the project was that you had to then assume a character who was as far as possible opposite to that one, and that was who you were to be for the rest of the semester, which was like eight more weeks. This was very, very interesting.

"And then we were put into groups of five on the basis of these new assumed characters. The meekest person would be like the group policymaker, and the one who tended to talk most would be who got to do all the dirty work, like buying things from the shops. He would be the dogsbody; that was my job, actually. And so you had people working with characters who were quite alien to them.

"And each group of five had another project that was a very complicated one that I can't explain, but we had to make the projects using those characters.

"There were some funny things (that) happened. There was one girl who was very timid, so part of her Mind Map stipulated that she had to walk this tightrope in front of the whole group every morning. This was her own stipulation, you know, these things weren't imposed; having designed your own Mind Map you then worked out a number of behavior patterns that you carried out.

"Another interesting thing was that the whole accent of the course was on working with other people; you could act alone if you wanted, but the accent was on group dynamics and how people worked together. In fact, we went into that in quite considerable depth, about how you got things done in groups and what sort of behavior tended to be counterproductive and so on. It was all very useful. I'm happiest working with other people anyway.

"It was really like early training in Oblique Strategizing, collaborating, all the techniques I use now, and it was certainly the most important thing that could have happened to me at the time. That lasted only two years and then everyone got sacked again, and I went to another art school: one of the staff whom I got on with particularly well got a job in another school and said would I come along and be a student there."

(via Bruce)

Heroic Chocolate

Amanda Palmer is in Australia, where she met Lance:

i owe you a treatise on chocolate, and love, and good, and bad.

here it
is:

good things happen and bad things happen. and also, bad things
happen and good things happen.
it is always like this.

when i got to
sydney, i stayed with lance.
lance is 31, and just came out to his parents
three weeks ago. after living a completely gay life forever that they were
totally oblivious to.
his boyfriend of a while is finally moving in with him
in new york. it’s significant.

his parents aren’t talking to him.
they say he’s going to get AIDS.
they say he’s going to go to hell.

it’s hard.

lance also found out something.
his mother told
him that he was allergic to chocolate when he was a little boy.

he’s
not, and he just found out. she was lying.
i kind of hate her.

there’s more poetry in this than can possibly be expressed.

so
lance has been eating chocolate every day since he came out, trying every type,
every incarnation and savoring like a madman.
in his hotel room there were
bars and bars, we had every kind of chocolate bar floating around, it was like a
drug den, and i helped the cause by eating chocolate first thing every morning.

we went to the fancy fancy chocolate shop on the circular quay in sydney
and we just bought shitloads of praline (the kind shaped like seahorses….i got
to bust his praline cherry, that was exciting)
and truffles and whatevers
and we sat there and we ate them all, one by one, in solemn gratitude.
chocolate had become a full-on symbolic oral celebration.

lance is
lucky, he will always eat chocolate like a kind of a hero, i think.

James Kennedy

"What an eccentric performance."

The Bush Dictatorship 2001-2009

Scott Horton of Harper's Magazine describes the extra-Constitutional activities in the Bush Administration: "We may not have realized it at the time, but in the period from late 2001-January 19, 2009, this country was a dictatorship."

Visit msnbc.com for Breaking News, World News, and News about the Economy

A couple of additional links:

2009 Harper's index

Brian Tamanaha posits that Yoo, Bybee, et al. acted in bad faith in writing the memoranda that effectively placed the President above the law.

The Daily Show Takes Apart CNBC

The Daily Show With Jon StewartM - Th 11p / 10c

CNBC Gives Financial Advice

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Joke of the Day

Nanotube Garden

Composite scanning electron microscope image of carbon nanotube structures constructed by John Hart's team at the University of Michigan. It reminds me of a plate from Ernst Haeckel's Kunstformen der Nature.

(via a chain of several people, ending with boingboing gadgets)

Zap

Dark Roasted Blend features a photo essay on creepy power plants. I'm pretty sure at least one of the sites has actually been used for a horror move (Blair Witch II). Power plants are high on both the risk and reward side for urban exploration: neat sights, possible toxic waste and dropoffs.

The Best of the Lone Gunman

The Lone Gunman presents his best links of the year. Some wonderful entrepreneurial stuff in there. I particularly recommend Study Hacks' advice: decide what kind of lifestyle you want, and reverse engineer your career to fit it.

Example Lifestyles

• The Power Broker: You live in a big city in a nice apartment. You climbed the ladder fast in a difficult business. You wield power. You’re good at what you do. You’re well respected. Your job is intense but you are super-organized so it doesn’t drive you crazy. You’re surrounded by good, loyal friends, and when you have fun, you have fun hard.


• The Serial Entrepreneur: You live in a nice San Francisco townhouse. You’ve started several businesses. Some more successful than others. You tend to alternate between an intense year or two growing a business followed by some extended time off for intense relaxation. You’ve got a network of good friends across the country and a bar down the street that you visit every Friday night to catch-up with your closest buddies. You use your off time to develop extreme hobbies and indulge in grand, hopelessly ambitious and wildly fun projects.


• The Virtual Voyager: You live in your dream house in a cozy community-oriented town, surrounded by natural beauty. You work virtually for several technology companies; setting your own hours. Three or four light days a week is enough to take care of your expenses. You and your family spend a lot of time outdoors, barbecuing with the neighbors, and, in general, enjoying small town life. You travel a lot for the sheer adventure of it.

Also, apropos of the "should I go to grad school" posts this month, here's the advice of the Science Creative Quarterly, which suggests that you think twice about it, due to the fact that there's a linear replacement rate for science faculty, but a geometric proliferation of grad students. The Malthusian pressure thus suggests that most science grad students should exit the research universities to do something else (teaching, government, industry). While we're busy redesigning grad school, we need to upgrade these alternative options in the eyes of the people laboring there.

Ways to be Cool

from Shyboyswin
(via a lot of people, until it ended up on boingboing)

Monetary Economics Taken to Woodshed

Mark Thoma on Williem Buiter's commentary on the current state of state-of-the-art monetary economics. Shorter Buiter: it's great at describing stable states, but awful at describing interesting ones.

Tales from the Downturn: the New Urban Landscape

Richard Florida, of The Rise of the Creative Class fame, has an extensive article on the sociological impact of the current crisis in the new Atlantic. He discusses the increasing disparity between hot urban cores and lagging "shallow roots" regions, as proxied by IP production and educational attainment:

Thirty years ago, educational attainment was spread relatively uniformly throughout the country, but that’s no longer the case. Cities like Seattle, San Francisco, Austin, Raleigh, and Boston now have two or three times the concentration of college graduates of Akron or Buffalo. Among people with postgraduate degrees, the disparities are wider still. The geographic sorting of people by ability and educational attainment, on this scale, is unprecedented.

The University of Chicago economist and Nobel laureate Robert Lucas declared that the spillovers in knowledge that result from talent-clustering are the main cause of economic growth. Well-educated professionals and creative workers who live together in dense ecosystems, interacting directly, generate ideas and turn them into products and services faster than talented people in other places can. There is no evidence that globalization or the Internet has changed that. Indeed, as globalization has increased the financial return on innovation by widening the consumer market, the pull of innovative places, already dense with highly talented workers, has only grown stronger, creating a snowball effect. Talent-rich ecosystems are not easy to replicate, and to realize their full economic value, talented and ambitious people increasingly need to live within them.

Big, talent-attracting places benefit from accelerated rates of “urban metabolism,” according to a pioneering theory of urban evolution developed by a multidisciplinary team of researchers affiliated with the SantaFe Institute. The rate at which living things convert food into energy—their metabolic rate—tends to slow as organisms increase in size. But when the Santa Fe team examined trends in innovation, patent activity, wages, and GDP, they found that successful cities, unlike biological organisms, actually get faster as they grow. In order to grow bigger and overcome diseconomies of scale like congestion and rising housing and business costs, cities must become more efficient, innovative, and productive. The researchers dubbed the extraordinarily rapid metabolic rate that successful cities are able to achieve “super-linear” scaling. “By almost any measure,” they wrote, “the larger a city’s population, the greater the innovation and wealth creation per person.” Places like New York with finance and media, Los Angeles with film and music, and Silicon Valley with hightech are all examples of high-metabolism places.

Fight Club Innovation

Tyler Durden's 8 Rules of Innovation

3. “I say never be complete, I say stop being perfect, I say let’s evolve, let the chips fall where they may.”

8. This is your life, and it's ending one minute at a time.

More on Grad School

Penelope Trunk demolishes the "grad school as response to a recession" strategy. In a more succinct version of a previous post here, she says, the "military is the terrible escape hatch for poor kids, and grad school is the terrible escape hatch for rich kids." She walks through the specifics of the various flavors of grad school, with specifics on each. It's an accurate and useful description. Grad school has three major flaws in general:

1. It has high costs, partially in money, but also in time. It requires a vast time commitment, with low payout for bailouts partway through, and high switching costs. PhD's in particular require uncapped time frames (as high as 7-9 years).
2. Most grad school options have highly limited exit options. A PhD outside of academia is a weird thing in the US, and makes it harder, not easier to get a real job. The academic hierarchy is jammed full of Boomers who got their positions in the 70's during the last boom era.
3. Quality of life is low. I don't even want to talk about it.

The best advice I have for grad school is: if you do it, get it over with quickly. There is not a degree on earth, outside of medicine, that should require you to be there for more than three years.

Two years for an MBA. Four for an MD, as at present, but the third and fourth year (ducklings/pre-interns) ought to be cash flow neutral. Law degrees should be compressed down to two in the future; the third year is filler. An MFA should be do-able in one high intensity year. PhD's should be good to go after three, as in some European models. Anything longer, and you're just shining your advisor's shoes.

Honestly, you're better off with a nice one year MA, as commonly offered in Economics or International Relations programs. Looks good on the resume, doesn't take you out of the workforce too long, and gives you some polish.

In any case, you need to make your pick based on the quality of your classmates. The ability to talk to a group of highly ambitious, really smart people with similar interests is the only real benefit of grad school outside of certification.

As for the military option, the upside is that every ex-military person I've interviewed (mostly captains coming off an ROTC pay-off, interviewing to get into an MBA program or consulting job) has two big assets:

1. a candid, can-do attitude toward problem analysis and problem solving


2. a broad emotional perspective. When a bad day is one where someone shoots you, there are no bad days in business

The downside to military life are much like the ones in grad school (long duration post-choice, poor quality of life, difficulty of switching, exit plans) plus the risk of injury or death.

The problem with a recession is that these other alternatives start looking better in comparison, but the decision is likely to outlast the economic crisis.

99 Things

Greg Rutter's Definitive List of 99 Things You Should Have Already Experienced on the Internet Unless You're a Loser or Old or Something

Alan Moore in Wired

Discussing the new Watchmen movie, and the near-impossibility of adapting comics to film. Also discusses the forthcoming Bumper Book of Magic, a grimoire for the whole family.

We were probably complacent because we assumed that we already knew about these things and these people. But we found out an incredible amount of new information.

We found out where kabbalah came from. It's not Hebrew at all, it's Pythagorean Greek. It was Pythagoras who first suggested adding three spheres to the classical seven spheres. He said, Yeah that's great, but you need another three spheres. You need one to represent the Earth, you need one to represent the six stars of the Zodiac, and one to represent the Primum Mobile—the first stirrings, or the origins of the universe, the Big Bang. It still obviously has a Hebrew element in its construction, but what happened is that the Pythagoreans had this system outlined, 10 spheres, each with their correspondencies. But this would have been translated into various languages, including Hebrew, in Alexandria around 100 BC to 100 AD. And there were scholars from all over the world passing through Alexandria. What must have happened is that Hebrew scholars picked up this Pythagorean stuff and realized they had a base counting system of 10, which would have made it appropriate to their mathematics, and that they could draw 22 lines between the 10 spheres, representing the 22 letters in the Hebrew alphabet. And they took it, and ran with it, and developed kabbalah as it is today. But the roots were originally Pythagorean.

...
We want this thing to have a lot of really fun inserts, fun features. Something that would delight a child. We want to make this not only a perfectly lucid and accurate book about magic, but we really want to make it a book about magic that would not disappoint an 8-year-old child if they came across it. Back when I was a child and I first heard about magic, then I kind of knew instinctively what a book of magic would be. It would be unimaginably wonderful. It would have fantastic things in it. It would be much better than the children's comics annuals I got at Christmas, and they were pretty wonderful. That is very much what we've tried to achieve. We want this to be magic that will be accessible to intelligent, modern adults. And we also want it to be magic that 8-year-old children will recognize as magic, as being as beautiful and glorious and entertaining as they had always hoped that magic would turn out to would be.

Warren Buffett Lays Out Some Reason

Berkshire Hathaway's 2008 Annual Letter, featuring a lot of logical thinking.

Stressed

Institutional Risk Analyst released its bank stress index report today. Details at the link.

Chicago vs. the World

Over on Angry Bear: Robert Waldman analyzes the validity of the IS-LM/Phillips Curve model, which Chicago finance guru John Cochrane called a "fairy tale". I am more than a little unclear on what models/assumptions my Chicago guys (Cochrane, Fama, Becker & Murphy; first-rate intellects all) are using that result in such different results from "everyone" else (Krugman, DeLong, et al). It is just a rehash of Friedman vs. Keynes or is there something more to it? Reading Cochrane's paper, it really does look like he's taking the Treasury View with regard to fiscal stimulus, by saying that an injection of $1 of government spending now is immediately offset by increased savings as we prepare to pay $1+interest in the future. An odd side effect of this is that actually paying down the debt in the future should not have any anti-inflationary effect at that time.

Update: Paul Krugman suggests an answer:

In the late 1960s macroeconomists began a search for microeconomic foundations — above all, an attempt to explain why nominal shocks seem to have real effects rather than merely affecting the price level. The 1970 Phelps volume, which suggested that imperfect information could explain a lot of what we see, had a huge impact on the profession. And when Lucas married this insight to rational expectations, it seemed to shake the foundations of Keynesian ideas about monetary and fiscal policy. Business cycles, Lucas suggested, last only as long as price- and wage-setters can’t disentangle nominal from real shocks — and monetary or fiscal policy can’t stabilize the economy, at most they add noise.

But it became clear after a few years that this approach wasn’t going to work: actual business cycles last too long to rely on imperfect information. And at that point the profession divided. One group went down the “new Keynesian” route, arguing that something such as small costs of changing prices must explain the rigidity we actually seem to see. This group isn’t averse to putting a lot of rationality into its models, but it’s willing to accept aspects of the world that seem clear in the data, even if it can’t (yet?) be fully explained in terms of deep foundations.

The other group decided that since they couldn’t come up with a rigorous microfoundation for price stickiness, there must not be any price stickiness: recessions are the result of adverse technological shocks, not demand shocks.

And the latter group, the equilibrium macro side, was so convinced of the logical correctness of its position that schools dominated by that view stopped teaching demand-side economics. (Schools dominated by new Keynesians, on the other hand, did teach real business cycle theory.) I haven’t been able to dig up the quote, but somewhere along the line Ed Prescott declared that his students wondered who Keynes was, because he was never mentioned in their courses.

And those trained according to this dogma were and are utterly ignorant of what Keynes, or modern Keynesians, have to say. They know that Keynesianism is stupid nonsense, because that’s what they remember having been told. But they don’t actually know why they’re supposed to believe that; the serious debates the profession had in the 70s about the microfoundations of inflation and unemployment theory are lost in the mist.

Update II 2/4/08: Brad DeLong reminds us that it's Say's Law , not Milton Friedman, that says that fiscal stimuli will result in immediate, perfectly counteractive measures, rendering fiscal policy useless.

Conversation with a Vulture Capitalist

The good news: some blue chip non-financials have been able to raise debt, and Obama gave a pretty good speech. The bad news: everything else, pretty much. Second lien debt is going at 33 cents on the dollar. Buy shotguns and canned food.