Consume

In the past few days I had that feeling again, where I seem to be a consumer machine. I don’t like it, but it creeps up on me until I recognise it again. Then I change my attitude and slow down, but I know in a while I will want again.

Wine that is fine

Wine is too strong.
I do love a few glasses of red wine, but the alcohol content has gone so high in recent years that I have to drink less of it the lovely stuff.
I think the makers could easily start making low (say 4-7% alcohol by volume), medium (8-11%), and high (12-15%) alcohol content variants.
Then I could drink more of it and they could sell me more of it.
Everyone is happy.

Marginalising Men

Increasingly in UK advertising, men are depicted as feckless and infantile. This has been the case for some years, as men play the fool to the women. Recently I have come across a few adverts that extend that subjugation, placing the children ahead of their father. Only the family pet remains to supersede the men, and they are often on par with men.
Perhaps this is only permissible because men are so confident in their status. Perhaps it is an over compensation in the movement to promote the cause of those perceived to be marginalised in the past. Unfortunately, whatever the reason, men are marginalised in this trend and consequently offer negative role models to boys. If our boys continue to be immature into adulthood, are these role models partly to blame?

Segregation

I visited a National Trust property a few days ago. I have been many before so the pattern is familiar to me. This time I found myself thinking what nice trustworthy people are to be found there and how it somehow seems like a little island of pleasantness to escape to. That turned into an idle muse that it would be a great place to live and the question ‘why might I have thought that?’.
I decided that all the people at a National Trust property, except the children, are there by choice and they have a similar set of interests and ideals, that is why there is such harmony. The children highlight this beautifully, they generally hate being in these old buildings, with a few exceptions, usually anything concerning monsters, ghosts, dungeons, dangerous animals or creepy crawlies. I can still remember that feeling from my childhood that I was so bored in these places that I might die of boredom if I did not get out soon.
Anyway, one conclusion that can be drawn from my muse is that if people are happiest in like minded cliques, so our country might be a happier place if we were all taught this early in life, differentiated communities were encouraged and people were helped to find their preferred community. Naturally our choices would change as we age and mature, but the current objective to help integrate people of all dispositions starts to look flawed. A system of aided self segregation in fact seems like a better objective. We already practice choice in our leisure time, so why is it not a good idea to encourage segregation into ghettos and ghettos within them and so on. Naturally I am not implying enforced poverty and reduction of rights, rather helping people understand what makes them happy and encouraging them to meld into like minded districts.
Obviously, segregation can lead to distrust and friction, but as people from one community can avoid those from another, this should on the whole be avoided. There are enough people now that we do not have to all get along. We can simply get along in our own little groups. Social networking using the internet is popular because it allows people to escape the confines of the geographic displacement and form groups of kindred minds. Clearly people would prefer to associate with others like themselves given the choice. So, a good policy for government would be to help them and so encourage segregation.

Icarus Economy

I distinctly remember Gordon Brown not so long ago implying he should receive plaudits for a successful UK economy. I also remember thinking that he did not do all the work, we did, the best one can say for him is that he did not get in the way too much.

Now it seems the economy is going pear shaped, will he be as quick to seek the responsibility for that? Perhaps there are problems even his mighty skills could not quell. Then again, perhaps it was just a combination of good fortune and our application that allowed the UK to prosper.

If we flew too high fuelled on hubris, we would do well to remember who was the designer of our wings.

Why Celebrity?

Many celebrities are not particularly unusual, nor have they done something excellent or noteworthy, so why are people interested in them? It would seem to be just because they are widely known. If that is true, why is it so interesting to people that someone is widely known?

Why for example is Paris Hilton interesting to many people? She garners a lot of interest for nothing exceptional, other than apparently being wealthy by someone else’s industry and antics which could broadly be summarised as childish or at best immature.

Credit Crunch Conspiracy?

I very rarely attend to conspiracy theories, when I do it’s just for entertainment value, so I am surprised to find myself writing this, but something smells odd about this credit crunch and I can’t just ignore it. Anyway you judge for yourself and correct me if you see mistakes.

I have read a lot about the credit crunch to try to understand it. Apparently it was precipitated when many more US borrowers than expected were not able to repay their residential property loans. Lenders belatedly reacted by tightening their lending criteria and something like hysteria broke out among them, restricting lending more widely and so impacting the economy as a whole. This spread to the UK and around the world via global financial institutions. I know this is a gross simplification of the situation, but documenting the hyperfine nature and causes of the credit crunch is not my task here; this is a good enough understanding for this post. For a deeper exploration see my earlier post: Understand the Credit Crunch.

For years I observed a property price bubble forming in the UK and for a while was surprised at its extent. Had I been in the US I think I would have experienced something similar. Lenders employ actuaries to do mathematical analysis and must know quite accurately at which point to restrict lending to maximise profits. So the lenders must have seen problems coming; even using the crude metric of house price growth against wage growth one could see that the situation was well away from the norm. Naturally lenders are happy with larger percentages of earnings going to them, but concerned that this extra thick slice of the pie does not get eaten away by bad debt. So how did things get so out of kilter? There are several possible scenarios:
1, the outcome is approximately what the lenders intended.
2, the actuaries got it wrong.
3, the people running the companies ignored their actuaries.
4, exceptional events confounded all the experts.

Certainly the first scenario is not claimed by anyone, so we can leave that for the moment. The second scenario does not seem likely. Actuaries are bright people that do exactly this type of mathematics for a living and they have many years of examples to draw from. Even I could see anecdotally the inevitability of most of the problems (at a course grained level obviously) only the spread of lending restrictions between financials was not obvious to me. The third scenario does have something of a ring of truth about it, because we have seen high profile heads role, but nothing like the clearout one might expect. Can the heads of so many large organisations have been so bad at their jobs? It could be self interested short-term planning by executives looking for a few years of exception bonuses and a golden goodbye. Perhaps the purge is not yet complete, or perhaps the top jobs are safe regardless. The absence of large numbers of high profile sackings implies that the financial institutions don’t attribute the problems to their executives ability or probity. The fourth scenario is also receiving some backing; in particular creative sales people supposedly managed to slip many billions of unwise lending through the system without anyone noticing. This seems more than a little improbable. I am sure that this happens on a very limited scale, but not in such amounts for so long. That would imply that nobody had noticed even the broadest of indicators looking dodgy and I feel confident that people must have been monitoring them. Perhaps I am missing one or more scenarios, but if not where does this leave us?

There is doubtless a combination of factors from the scenarios, but as much as the property price bubble was obviously forming, none of these scenarios or a combination of them is obviously causal. That leaves me reconsidering the first scenario. Perhaps we are broadly where the money lenders expected us to be. Not only have they grabbed a larger slice of the economic pie for themselves, they are seeking even more from state / central banks as support and that eventually translates into taxation. This reminds me of the old saying about owing a lot of money to the bank implies the bank owns you, but owing an amount the bank can’t afford to lose implies you own the bank. Do the lenders own us all? Are they using the state / central banks as proxies to extract even more through extra taxation on their behalf. Certainly the wealth extracted so far by them either was not created yet and that is what needs correcting, or it did and is now somewhere. If it didn’t exist that implies serious strategic mismanagement on a colossal scale, which again would be easy for the actuaries to spot. If it did exist where is it now? Have we been intentionally cleaned out by the lenders? Certainly the outcome seems to be the same.

I know that some of you will say that hindsight provides perfect vision and that the financial institutions were heading into this blind. To that I would say property price bubbles are nothing new, we have seen them before, their outcome is broadly similar. How can a property price bubble have exceptional or unexpected consequences when we have seen them before? Is something different? Well if it is simply that the scale of the thing is bigger then it should have been more obvious as it formed. It was obviously a problem building to me as a casual observer. Admittedly I did not foresee the lenders restricting credit to one another, but then it was not my concern to look out for such a problem.

Perhaps I have misunderstood or not noticed something, if so I am sure someone will put me right and that is what I think is most likely, but until I have that understanding I have to say things look suspicious.

English Nationalism

The fact that English Nationalism has been weak in recent history should be a cause for celebration. Nationalism creates a division, an ‘us and them’ mentality that breeds mistrust and that tends to encourage confrontation. Nationalism is a throwback, something to be avoided, a sign that one is not mature.
Although it is difficult when you are provoked by people like Alex Salmond and French politicians, remember you are an individual first before you are English. Strive to be an individual before a member of any group and you will feel a far greater sense of pride than comes with nationalism.

On dumb = cool

I originally posted this in June 2006 as a comment on a post that bemoaned how it was not cool to be smart; worryingly, I think the situation was in school. Anyway, by chance I came across it again a few days ago while searching through my documents and thought it deserved one more mirthful outing, this time on my own blog.

It may be cool to be dumb, but only amongst the dumb. Those of you who are not dumb can pretend to be so if you wish, because the truly dumb will never guess. So we can all be cool, but the not so dumb can in their angst eventually find less dumb things to do with their smart brains than pretend to be dumb. If you don’t find better things to do, then you must in fact be dumb anyway and ergo cool, even though you never realised it. You people should stop worrying about being cool or dumb because you are both, apparently. If you are deeply dumb you were probably lost somewhere a couple of sentences ago and are very cool anyway; you lucky people. If you read this far and are not confused you are probably not dumb, or at least have plenty of time to figure out what un-cool people talk about and are now laughing with your cool mates. If the latter you may want to consider the possibility that you are borderline dumb or have non-dumb tendencies and should perhaps check what you are wearing, in case some of it is un-cool. If the former you can congratulate yourselves on not being dumb, but you mostly likely look a terrible sight. However, in a kind of inversion of the deeply dumb you won’t care and are wondering what all the fuss is about having speed read this or just skipped it because you could see where it was all going. As for the majority of you that think those dumb people and smart people are lucky not to have all this cool and dumb stuff to worry about, consider yourselves lucky. You can choose to look fairly cool or be reasonably smart and have found a distraction at your level, that is why you are the ones most likely to be reading this.
If you respond to this post what does that say about your dumb / cool credentials? Would it be smart or dumb? Everyone will know!

Advanced mathematicians required by the public sector

Wow, what a lot of people got involved in this debate.
It must be so important, or vote worthy!
I would be pleased if we could just find some people who can count.
Can it be that complex to organise counting people on and off an island?
Another bloody shambles!

Lets hide the debt problem!

The Master Liquidity Enhancement Conduit (MLEC) fund has been created by several big US banks with between $75bn and $100bn (depending upon who you believe) to buy up debt from Structured Investment Vehicles (SIV) which in simple terms are mortgage providers. The debt is largely in the form of Residential Mortgage-Backed Securities (RMBS) and Collateralised Debt Obligations (CDOs) – i.e. mortgages. SIVs, which own about $400bn of assets, are investment pools used by banks, but most enthusiastically by Citigroup who originated them in the 1980’s. It is now clear SIVs have been too keen to offer debt to financially dubious property buyers. The MLEC is an attempt by the private sector to mitigate some of the risks associated with bad debt incurred during the US property price bubble. That bubble was inflated by the poor lending strategies of the SIVs and ultimately those that initiated them. The MLEC fund will be accepting only the best risks, leaving the worst in the SIVs, so they will flounder rather than the banks. It is interesting to speculate as to why this cause was not taken up by the IMF, whose role it is to promote international financial stability. Perhaps they do not see it as a big enough problem.

So can this fund help? Well as an attempt to reintroduce confidence to the market and hence stability, to some extent that is going to happen, especially as it has the tacit approval of the US treasury. However, ultimately the problem is rooted in lending money on the basis of economic growth that was not there. Now that position has to unwind and the costs of the overestimate will have to be dissipated. This fund can only act as a buffer, trying to spread and slow the normalisation cost, it still has to happen. So in that sense it is more like an attempt to convert a painful punch into a protracted uncomfortable pressure. The problem has to be handled and it seems that somewhere someone has made the decision that the drawn out normalisation approach is the better option. So as we get used to the inevitable slowdown, the remaining market confidence will be subdued rather than demolished. In that sense it is a better strategy as stability and confidence are perhaps the most essential assets of a reliable economy. Ultimately the costs of this failing will be carried by everyone, the banks will ensure that, rather than just their shareholders.

The age of politicians

What is the ideal age for a politician? Clearly neither extreme is good, so as we converge toward the middle ground there must be a best range, perhaps even a best year. It probably varies a little from person to person, but roughly where is it? I was thinking perhaps 45 to 55 might be the golden years. What do we think? Is Menzies Campbell too old, Davis Cameron too young and Gordon Brown about right?

Leadership

Current events in Burma remind me of dire situations in many countries. I have to wonder if those countries ever will have a government of hard working, well balanced, honest, intelligent and visionary leaders. It seems that they are always lost to the lowest common denominator in their people.
Western governments too are a very long way from perfect, even though they like to crow about their high moral principles. It is relative I suppose. They very rarely torture or kill protestors and dissenters, or nakedly display the turpitude and corruption of their executive. However, a clear unadulterated vision seems to elude them, lost in the fog of petty bureaucratic hegemony they flounder. I suppose they would answer that things are not as simple as they seem to the uninitiated, but perhaps would also admit that somewhere along the route they strayed.
Is it inevitable and a symptom of human nature that people who end up with positions of power will be corrupted and misuse them? Or is it that the most corrupt and corruptible peruse power most earnestly? Are people improving over history, or not? Or, in this is a dog-eat-dog world, do people on balance tend get what they deserve, after all, their leaders are culled from among them?
I like to think that things are changing for the better, but it is hard to make a good case for the notion. My own country (the UK) recently took war to another country that was no threat to it at all. A shameful state of affairs, however it was arrived at, via incompetence or lies. Can this be the best of all possible worlds?