Apologies for the lack of original posts. The site was down for a while overnight.
American companies could soon mine asteroids for profit Wired (Vlad)
Vandana Shiva: Agri-Corporations Attempt to Hijack COP21 EcoWatch (furzy mouse)
Amazon Selling $40 Android Tablets That Come With Pre-Installed Malware International Business Times
Depo-Provera, HIV and the WHO: Forsaking Science for Special Interests? Truthout (Doug S)
Apple Inc. Wants To Be Your Bank, And The Big Banks Should Be Worried International Business Times. I don’t buy the concern at all. Banks have been entering into co-branded arrangements for years; I did a series of projects for Amex on this business nearly 20 years ago. Apple won’t get the other skills, like risk management or credit underwriting, from this exercise.
Myanmar
Suu Kyi’s NLD wins Myanmar landslide BBC
The Military Will Still Control Myanmar After Aung San Suu Kyi’s Victory US News
Myanmar Generals Set the Stage for Their Own Exit New York Times
Watching Myanmar’s Elections with the Country’s Most-Wanted Comedians VICE
China?
Too big to fail Chinese banks face $400 billion capital call Reuters
Four points about how China’s ‘economic transition’ will shape and shake the world economy George Magnus
China warns US B52s over South China Sea Financial Times
Report: Torture is routinely used in China to obtain confessions and silence human-rights lawyers Business Insider (furzy mouse). Quelle surprise!
‘Vale and BHP were completely careless’: Brazil levies initial fines of $93 million over Samarco tragedy Sydney Morning Herald (EM)
Eurozone Economy Slows as Exports Weaken Wall Street Journal
Crickhowell: ‘Offshore’ Welsh town unites in its anger at Britain’s corporate tax avoiders Independent (Chuck L)
Labour’s share Andrew Haldane, Bank of England (Vlad)
Syraqistan
How do you smuggle 48,000 cans of Heineken into Saudi Arabia? Disguise it as Pepsi. Washington Post (furzy mouse)
Revealed: Saudi Arabia’s manifesto for change in the face of rumours of coup plots Telegraph. Margarita: “And they will do this as soon as the war against Yemen wraps up…?”
Yes, the Islamic State’s attacks on the Yazidis constitute genocide, new report says The Washington Post (furzy mouse)
Benjamin Netanyahu Defends The Israeli Occupation At Progressive Think Tank Huffington Post (furzy mouse). A close-to-MSM outlet uses the word “occupation” in the headline. Wow.
CodePink Delegation to Palestine David Pera, OpEdNews
Imperial Collapse Watch
U.S. Airstrike Targets ‘Jihadi John,’ Terrorist in ISIS Beheading Videos Wall Street Journal. This isn’t just a news story. The Journal saw fit to send this as an alert, meaning one of the half-dozen “must read now” stories of the day, and the BBC has it as its lead story now. This is a sign of how far the US has fallen. Things like major battles in progress are the stuff of headlines. Targeting one guy? And in another element of importance inflation, those “airstrikes” are with drones, and we haven’t gotten the Bad Guy yet, although the media barrage strongly suggests that he is actually already dead or so cornered that he is certain to be dead. And we are using gee-whiz super tech that still makes red mist out of a lot innocent bystanders. This is awfully reminiscent of the “we got Osama Bin Laden” media campaign. I wonder what Wag the Dog embarrassment The Power That BE want to crowd out of the headlines right now.
Big Brother is Watching You Watch
Did the FBI Pay a University to Attack Tor Users? Tor Project. William B: “Note also that Carnegie Mellon is on the NSA’s list of ‘Centers of Academic Excellence’ (a polite way of saying ‘NATSEC Minions’).
Documents Expose FBI’s Targeting of School of the Americas Watch Institute for Public Accuracy
Trade Traitors
Trump Was Right About TPP Benefiting China David Dayen, Intercept
2016
Time for GOP panic? Establishment worried Carson or Trump might win Washington Post (Jeff W). I’ve said for a while that like 2012, this election was for the Republicans to lose….and they are setting out to do it again.
Leaked Emails From Pro-Clinton Group Reveal Censorship of Staff on Israel, AIPAC Pandering, Warped Militarism Glenn Greenwald, Intercept (furzy mouse)
Anti-Obama activist challenges Sanders in NH CNN
Postal Workers’ Union Endorses Bernie Sanders for President Associated Press (furzy mouse)
Nina Turner changes her mind on Hillary Clinton, endorses Bernie Sanders for president Cleveland.com (furzy mouse). An important development.
Court upholds California death penalty BBC
Why Jeffrey Lacker Is Worried About Inflation New York Times (resilc)
Markets stumble after Fed comment hinting at interest rate increase Washington Post
Blackstone buys $3bn of property funds from Calpers Financial Times (Gary B). We don’t have the terms, but this could prove to be a very good move for CalPERS. Blackstone has a nasty history of doing big real estate deal at the top of the market, and its foray into rental housing is not looking so smart. CalPERs is not exiting for market timing reasons, but cool-headed people were telling me the commercial real estate market looks overheated six months ago and it has only gotten worse.
Voluntary disclosure of offshore tax evasion VoxEU (Vlad)
Beyond Banking: funds’ talent pool dries Financial Times
Guillotine Watch
Billionaire Spends Record $48.5 Million on Blue Moon Diamond for 7-Year-Old Daughter Newsweek
Class Warfare
What Peter Drucker Had to Say About Automation Harvard Business Review
Split emerges among US holiday shoppers Financial Times
Tech companies, labor advocates, and think tankers of all stripes call for sweeping reforms to the social safety net Washington Post. Not to help workers or stimulate demand, but to facilitate the growth of the “sharing” economy.
Antidote du jour. The famous Hachikō:
See yesterday’s Links and Antidote du Jour here.
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The Middle East is an iceberg and the US is the Titanic. And our captains keep reversing the engines, backing up, and throttling full steam ahead to hit the iceberg again and again and again.
It is amazing….
And for the most part, our choices are:
A. Back way the hell up because we are just not ramming it hard enough
B. Back up not so far and just keep ramming, but not quite at full throttle…
It just NEVER even occurs to most to not hit the iceberg. (they say “its just hard water!!!”)
From a posting at put later in this thread:
“Again, Trump gets it. He has increasingly favored nonintervention. He argues that we should not have intervened in Iraq and Libya and should not do much in Syria. He wants the Europeans to take the lead on confronting Russia over Ukraine. When asked by NBC’s Chuck Todd whether Ukraine should be a member of NATO, his answer was extraordinary and revealing: “Whether it goes in or doesn’t go in, I wouldn’t care.” I would wager that most Republicans would agree.”
=======================================
Paul didn’t go full isolationist, and I think it has cost him dearly. People may believe Trump is ALL immigration, but there are a few other points where he is exploiting the fact that the establishment republicans are quite at odds of a significant number of their base…
. Looking back at the Goldwater era not much has changed in the Republican Party as the Northern elites continue to be pushed toward the Democrats or Independents as the Republican base outside of a few Northern states is solid Christian White and Southern.The Republican business establishment has moved over to the Democrats or at least split money with both parties while Koch and others are trying to move the Party to Libertarianism. The Republican Party might be interesting at some point in time but with White Christians as its party base its has for now only a strong regional voter appeal.
Some here must have missed the Trump call for bombing the sh*t out of Isis…essentially he has gone full war-mongering:
During a campaign speech at the Decker Auditorium of Fort Dodge, Iowa, Republican frontrunner Donald Trump elaborated on his plan for dealing with the so-called Islamic State: “Bomb the shit outta them.” The remark came as the business mogul lamented how, upon first entering the presidential race, media outlets repeatedly pressed him to reveal his self-described “secret plan” for dealing with ISIS. “I’d just bomb those suckers,” he continued. “I’d blow up the pipes, I’d blow up the refineries, I’d blow up every single inch, there would be nothing left.” (http://www.thedailybeast.com/cheats/2015/11/12/trump-i-d-bomb-the-s-t-out-of-isis.html)
That doesn’t sound like anti-interventionist, it is how to destroy and entire country…and simultaneously complain about immigration. Surely you can connect those dots?
I think ‘blow up every single inch’ was tried in Vietnam and even surrounding countries, and it didn’t work so well at achieving the stated goals.
Also, bombing every single inch sounds like a succinct description of a plan for genocide.
From the Huffpo article on Netanyahu:
Back in Jim Crow days, full participation in U.S. democracy was claimed to be infeasible for ‘African savages.’ Under Israeli Jim Crow, the preferred formula is ‘Muslim medievalists.’
The logic of apartheid requires defining the second-class citizens as incapable of enfranchisement in a more advanced culture. So it’s not hate. It’s only logical!
Re: “Apple inc. wants to be your bank”
Spot-on. No, Apple doesn’t. And Apple Pay actually embeds the power of the incumbents such as Visa, MasterCard and the conventional card issuers (and therefore helps cement their rent extraction ability). Which is why they are falling over themselves to cooperate with Apple Pay. Apple gets to insert itself in the value-chain (which is to say it gets to pick your pocket in the form of obtaining and monetising your data).
False. Every in-depth analysis of Apple Pay has yet to find any evidence of this. You might be thinking of Google Pay. Apple is making money off Apple Pay by getting a few cents of each transaction of the merchant fee (in return for shouldering the fraud liability from any Apple Pay transactions) and by making it a feature they hope will drive further phone and watch sales.
I disagree — the current fee structure (0.15% vs. 3 to 5% or so for the card network and merchant services providers) for Apple Pay does not cover their costs. Aside from the development costs and marketing, Apple is having to throw money at merchants, the merchant services providers, the card networks as well as the card issuers. They are having to pay off everyone in town.
At some point in the future perhaps they may hope to make themselves indispensable and so be able to jack up their fee.
But this would be at the expense of the card networks and the merchant services providers and annoying Apple Pay users will be preferable to them to allowing this cuckold to grab anything other than a few crumbs.
No, Apple are doing this for the data they can obtain.
FBI to investigate ‘needless’ fatal police shooting of white Idaho rancher
That was fast. And apparently James Comey isn’t worried about a
FergusonCouncil, Idaho, Effect™.“American companies could soon mine asteroids for profit.”
Pretty funny. What does “soon” mean? In the next 25 years? And how soon after they start mining do the profits come? Another decade?
Whenever copper hits $1000/oz.
Could be financed by global lottery game of chance predicting where they land! Oppsie! Was that trajectory calc done w/ meters or feet?
“Right……Let me show you something….This little rock pays for the whole show…now go out there and get me some results!”
I’m sure it won’t have to go a dime over $950. After all, we have an inexhaustible supply of cheap energy to deal with the orbital mechanics. Inexhaustible, I tell you.
This whole thing reminds me of the innumerate yahoo once encountered in some other venue who claimed in all seriousness that the helium supply wasn’t a problem because we would soon capture it from the solar wind.
The charging cable for your iPhone Infinity will cost $400.
Lots of sci-fi stories wrapped around what happens when “corporations start mining the asteroids.” Some postulate that miners will want their own political economy, freed from the neoliberal predations of the Homework. And think about what kind of clout a bunch of tough space miners will have, via embargo, and more pointedly by being able to alter the orbits of a bunch of asteroids of various sizes and compositions to impact on the home planet that we inventive Naked Apes are already so compondiously demolishing the livability of.
I happened to see a piece on the NASA cable channel yesterday, bragging up the whole space mining thing and with interviews with program managers and high production value videos of the current “government funded programs” and all the Really Cool Stuff thats been developed so far, and including newer propulsion systems that are “solar-powered–” ion engines etc., not needing reaction mass from Terra. So if “we” don’t burn or blast our idiot species out of existence any time soon, this looks like a public-private partnership that has legs… All you remoras out there need to start researching the best investment opportunities for yourselves, in this Brave New World — Megshark is always on the move, has to move, to keep the waters of “trade” flowing past the gills, or it suffocates…
Robert Heinlein used to say you could spot the Belters and Rock Rats by their awkward loping walk, after all that time spent in artificial gravity.
do they still make Tang?
do they still make Tang?
The “extended” stay version will be recycled urine.
http://www.bibliotecapleyades.net/salud/esp_salud06b.htm
An acquired taste
Toufer. The asteroids will be aimed at our remaining ghettos slated for gentrification. Robots will convert the raw materials directly on site (cleared right down to bed rock by the impact) for new construction materials. Actually, a threefer; 60 minutes gets a story on how next time those freeloaders will have learned a lesson about living off the public teat.
“not needing reaction mass from Terra”
I imagine they still need a constant flow of plutonium for the Belt ore smelting stations – unless they get Zero Point Energy to work halfway to Jupiter.
And the potential for the ultimate kinetic energy weapon is huge, so DARPA will kick in a few bucks. After dropping asteroids on Russia, you can mine Russia for natural resources!
Makes you wonder why the Moon doesn’t look like Swiss cheese by now. What a minute. It does!!!!!
I just realized Trump could do a “Apprentice” mini-series on this!!!!!!!
If it’s anything like the rest of our economy, we’ll be waiting 35-40 years for the profits to “trickle down”.
And then we’ll still be waiting.
Maybe we can start mining the asteroids as soon as “The Expanse” premieres on the SyFy Channel (I hate that spelling) in December, 2015.
They spell it that way because they couldn’t trademark Scifi.
But yeah, sort of silly.
Is that the same asteroid we’ve been waiting for for years?
It’s been like waiting for the rapture. You just keep looking up watching and somebody screams “Asteroid! Asteroid!” and points at the sky. (It might be Wolf Richter, but it could be a lot of people).
Then you say to yourself, “That looks like a bird to me. At any rate, with enough money printing even if it is an asteroid they can turn it into a bird whenever they want.” After a while you ask yourself “Why am I doing this? Is it some kind of personality defect or some fatal compulsion that drives me to financial self-immolation?” If psychiatrists weren’t so expensive, it might be worth going to one, just in case they have an answer the makes sense. But that would mean losing even more money and that’s the problem, isn’t it? Why double down?
it makes it hard. Now, if you can make money on the asteroid by mining it rather than shorting it, that may be something worth doing! At least for somebody else, somebody who doesn’t mind rolling up their sleeves and breaking a sweat. And travelling in a space ship through interplanetary space. Maybe Tesla can make a space ship that takes workers to the asteroid for mining operations. Or maybe Apple. Or Amazon! This in fact sounds like a job for Amazon. That could make it a ten bagger, even from here! Then finally when the asteroid does hit, after you’ve given up completely on gravity itself as a force of nature, at least you’ll have gotten rich first. It won’t solve all your problems, but at least you can have nice thoughts there in the final moments, thinking about how nice it was to have finally made some money off an asteroid. Better late than never.
American companies could soon mine asteroids for profit Wired (Vlad)
————————–
This is certainly bad news for Australia, Peru, Africa and China.
Another promised showing of the miracles possible in the religion of science.
“I give you the miracle of the internal combustion engine.”
“I give you the miracle of the atomic bomb, sorry, atomic power.”
“I give you the miracle of the toxic, check that, the green revolution.”
Stay positive. Nothing bad will happen with this new miracle. At least we don’t talk about it now.
Forigive me is this is inappropriate but I would like to return to Yves’ post yesterday regarding Miami Beach. In the face of impending disaster from sea-level rise, the Miami Beach mayor defends the colossal building boom by an appeal to an unforseen techno-miracle. That might make sense to the mayor somehow but the market is supposed to be rational. Why isn’t it? Why does the market not account for global warming? Why do people keep pouring money into these boondoggles? Why aren’t the prices of coastal real estate steeply discoubted to reflect the fact that there is no longer “ownership” when it comes to coastal real estate, there is at best long-term renting. I suspect that one of the big drivers of global warming denial is that accounting for global warming will roil the economy. But that is human thinking, wishful thinking, denial. The market is claimed to be efficient and ruthless. Why isn’t it in this instance?
The idea of a rational market is a fairytale. The market is comprised of people and people do NOT always make rational decisions.
That being said, I suspect that because property is often insured that the people buying property on the coast figure they will get their money back one way or another.
My understanding is that while individual people may be irrational the function of the market is to aggreagate and dilute that irrationality so that the market itself remains rational. Perhaps I misunderstand. As for the individual irrationality being explained by “they will get their money back one way or another,” how will that happen? A tremendous amount of wealth will be destroyed and someone must take the losses. Who? And the misallocation of investment resources into these foolish projects is atill baffling. I assume that whoever is financing this Miami Beach construction will get out before the losses are incurred: build and flip. But that is certainly not market efficiency. And if this is the best the market can be at allocating resources that is a damning statement on the foundation of capitalism.
Yeah, you definitely misunderstood. “Market” is a comfortàble myth, a word that blandly creates an “engram” in our little manifold and collective windows of consciousness that lets the predators and parasites and deadly tumors excuse the destruction they create, and pacifies the mopes with the idiotic notion that all will eventually stabilize and even out and level.
Maybe the comment was snark? Sorry for the condescending pedantry, if so. Maybe we are back to more gallows humor today, as a defense mechanism against the perceptions of futility in all this?
Unfortunately, my comment was not snark. The failure of Mr. Market to account for global warming seems to me to be the Mother of All market inefficiencies. Perhaps you (and waltz) are correct: there is no genuine “market” that operates to weed out inefficiency and deliver the optimal resource allocation. If that is so, then it represents a condemnation of the capitalist system altogether. I wonder how the capitalism defenders defend this.
The idea that millions of irrational actors pursuing their own unimpeded goals will produce a rational, optimal equilibrium outcome as some sort of emergent property has long struck me as an idea for which evidence was, shall we say, somewhat lacking. I guess it works if you define “optimal” tautologically as the Ayn Rand types are wont to do.
Marx has a certain amount of fun with this:
“The economists express it thus: everyone pursues his private interest and only his private interest, and thereby unintentionally and unwittingly serves the private interests of all, the general interest. The point is not that, in pursuing his private interest, everyone serves the totality of private interests and thus the general interest is attained. This abstract statement could rather lead to the conclusion that everyone mutually hinders the assertion of the interests of everyone else, and instead of a general affirmation, a general negation results from this bellum omnium contra omnes.”
“The point is rather that private interest is itself already a socially determined interest and can be attained only within the conditions laid down by society and with the means provided by society, and is therefore tied to the reproduction of these conditions and means. It is the interest of private persons; but its content, as well as the form and means of its realisation, are given by social conditions that are independent of them all.”
Seems like the various players who hide behind the “capitalist” façade “defend it” (the “market” ideology fraud) by buying, becoming the “legal owners” so called, of everything. All the trends, the “vectors,” point to and reinforce that “Libertarian Unitarian” endpoint…
We mopes who create the real wealth need our sense if order, recently faux-labeled “ruleoflaw,” and structure and “someone in charge.” And we prove time and again our collective clueless easily deluded wimpiness when it comes to ensuring a “modest competence” for us and our families and wider circles, and of course our great ability to take a blow or kick or Hellfire warhead to the forehead, pick ourselves up to re-make the substrate of the political economy (see, eg., Beirut, Gaza, the World Wars, Kandahar, and Obama’s “recovery”) and occasionally ask Fagin for ” some more…”
From observation, what exactly is or are the “organizing principle(s)” of humanity, again? Ants, roaches and slime molds seem to know some that are a lot healthier than ours.
I’m not sure the “market” is convinced that sea level rise is going to be more than six feet and occur earlier than 20 years from now. Plenty of time to sell to the next sucker.
(Don’t get me wrong: sea level could easily rise 20′ in the next 20 years!)
Yeah, the capitalists always think that they can get out before the bubble pops, but then 1929 or 2007 comes and hits them in the face because they kept telling themselves “We still have at least one more year before the bubble pops…”
Of course, in 2007 they probably realized that the gubermint would give them their money back if things got too bad anyway.
ZIRP at work, again. Free money = wasted resources. And, of course, there’s “one born every minute.”
I think it’s true that this sort of thing is driving global heating denial.
wbgonne–
For Mr. Market, global warming is simply not a problem. How could it be? By the time Miami Beach finally sinks beneath the waves, the smart money will be long gone!
/snark
Markets are fundamentally irrational. At their foundations. The reason they are fundamentally irrational is that they assume that the living, physical world responds happily, slavishly, and favorably to our whims. (It doesn’t.) This is the dirty little secret they don’t teach along with the supply/demand curves in Econ 101.
–Gaianne
As far as insurance goes, I’ve read private property insurance is generally not available for RR* and FEMA has been the insurer of last resort. Tho when Katrina hit, I read that FEMA was re-thinking whether insuring RR was a good idea or not. (FEMA has been insuring rich people’s mansions in hurricane zones) haven’t heard what they decided on.
Losing multi-millionaire homes to mudslides in Malibu, CA has been going on forever. Prices keep going up on the ones still there.
RR = Ridiculous Risk
Cui bono? And more important, Cui pays? http://www.newsday.com/classifieds/real-estate/funds-will-pay-for-fire-sprinklers-in-homes-elevated-after-sandy-1.6889647 and a whole lot of hits when one looks a little under who pays to rebuild mansion destroyed by storms and wildfires? And inlove the bulls-ttery of euphemisms, who pays to “renourish” beaches? Gee, I wonder…
Well, at least if the beaches are nourished, we get an intimation of the invisible hand at work. I didn’t even know they were hungry.
The beaches on the East Coast are “hungry” to the tune of billion$ of dollars. More “free stuff” for the well-to-do.
Flood insurance is extremely expensive. We should have it and don’t.
Yes, that is the cutting edge. There was a bill — the Biggert-Waters Flood Insurance Reform Act of 2012 — that essentially phased out federal subsidies for flood insurance over 5 years:
https://www.fema.gov/media-library/assets/documents/31873
But Biggert-Waters has been whittled down significantly under pressure from … well, just about everybody:
http://www.fema.gov/media-library/resources-documents/collections/414#
So it appears that the American taxpayer remains on the hook, subsidizing foolish insurance on risky coastal real estate.
In this market who determines rationality anyway? It isn’t like everyone places the same value on items. I might think paying $5 for a cup of coffee is not a rational choice when I can buy coffee and make it at home at a much lower price. However, millions of people buy Starbucks every day. Does that mean that they are irrational or does it mean they value the convenience and perhaps the taste of Starbucks coffee?
Personally I think the form of capitalism we have does a crappy job of allocating resources. I don’t think it’s particularly efficient either. I suspect the inefficiency is a feature though because it makes the system less opaque and allows the rentiers to rob you more easily and with less question.
Who here thinks having 50 different regulatory standards for health care is more efficient than having one? Who here thinks that having multiple price points for different insurers or multiple price points for the same surgery at different hospitals is efficient? Certainly not me. It does, however, make it easier for the health care industry to rob you blind.
These are all good posts.
I suspect that a completely centrally planned, Soviet Union style system would do one of three things with Miami Beach:
1. Build a second Miami Beach on another sandbar.
2. Start the process of evacuating people and businesses further inland.
3. Absolutely nothing.
However, the actual system the US has -which isn’t really a free market system now, its more similar to 1920s Italian corporatism- is building more in Miami Beach, which is the worst possible choice. And there seems to be no authority even theoretically capable of deciding and executing otherwise.
New Orleans is another example. There is alot of justified sentimentality about New Orleans, but really there should be a plan to relocate the port, and with it most of the jobs and population, farther upriver, and then figure out how to preserve the French Quarter somehow. But this isn’t being discussed.
Actually building on those beaches is as free market capitalism as you can possibly get. It doesn’t matter if it makes absolutely no sense to build somewhere that will be below sea level in a few years, all that matters is can you find a moron willing to purchase so you can make a profit.
It’s financial musical chairs. Eventually someone ends up with the short end of the stick but that really doesn’t matter until the music stops playing and many intend to be long gone with the cashola before that music stops playing.
The word authority suggests that there should be some regulatory agency which is the opposite of what a free market wants. Generally speaking town planning falls under the premise of government too. Unfortunately, to run those effectively you have to collect taxes and everyone knows what Mr Market feels about those(those should be everyone else’s responsibility to pay, or in the category of not my problem. The goal is to pay as little as possible because every time you allocate a resource it cuts into the goal of maximum profitability.)
The market is more concerned with here and now then it is worried about 50 years down the line. It figures it will worry about 50 years from now, 50 years from now. In a capitalist system what matters is profitability and that you not be the guy left without a chair when the music stops playing.
What’s not logical, never mind ruthlessly efficient about, “Heads they win, tails we loose?”
Like this? http://www.theguardian.com/business/2015/nov/12/walmart-workers-protest-wages-fast-for-15-stolen-lunches
I know you weren’t replying to me but I’d like to respond anyway. I agree with you about the musical chairs analogy: that’s precisely what this is. However, I dispute the notion that this is free market capitalism operating as it should. As I understand things (perhaps incorrectly), one of if not the primary theoretical justification for capitalism is that the free market most efficiently allocates capital. That is clearly not happening here. The fact is that failing to account for global warming means there will be enormous, catastrophic losses, compounded even now by good money following bad money right down the toilet. The fact that the losses will be absorbed by one group rather than another doesn’t change the point that there will be zero-sum losses. Wealth will be destroyed. Under capitalist theory that shouldn’t happen, not at least on a systemic level like this.
If Mr. Market is such a fuck-up why defer to him at all? Further, why allow Mr. Market to exist if his primary justification is a fiction?
These are excellent points, but they remain equally valid for just about anything that is happening in this best of times, never mind the insane exploitation of ocean front in a highly unstable geological and highly corrupt political social and economic climate.
Your question, “why allow Mr. Market to exist…”, does seem (just a tad – to use well intended but by no means disrespectful snark) rhetorical, no?
Yes, it is rhetorical but so is everything else I post!
If capitalism is failing in its primary purpose of efficiently allocating resources that is noteworthy. It is noteworthy because widespread recognition of such failure is how a prevailing philosophy unravels.
Global warming exposes free market capitalism as a fraud. Spread the word!
BTW: I’d love to hear someone defend capitalism against this critique.
Well, you’ve moved it up a notch, maybe several notches from beach front to global warming. So there’s that. If you were to up it a few more notches, say, for instance, “Capitalism is a fraud because man exploits man”, then I could paraphrase J.K. Galbraith and reply, “Yes, whereas in Communism, it’s the other way round.” :-)
Well, much lurks within that catchword “efficiently.” Because you can’t just be efficient. Efficiency, to be a meaningful criteria, has to be efficiency with reference to accomplishing a particular thing.
To take a trivial example, if you just asked a team of engineers to come up with an efficient system of processing and distributing codfish, what they came up with would almost certainly not involve catching them in the North Atlantic, icing them down, shipping the whole lot across the world to China, processing it there, then shipping the finished product back to Iceland, Norway or Britain, thence to be further shipped to various retailers hither and yonder. But once the guy who signed the checks stipulated that labor arbitrage trumped all other factors, they would then perhaps find this their most efficient option.
No argument just i.
Scratch “Geological” -> Unstable climate (though changes in the ocean likely due to changes in the climate may actually be having an effect on geology and may account for some volcanic activity as well as some plate shifts ).
As long as the owners can get insurance through the government (NFIP), the losses will be absorbed by the taxpayers. It’s like the financial crisis – privatize the profits and socialize the losses. Mr. Market is at work when private companies won’t insure those risky properties.
A free market is an unfettered market so actually it inches closer and closer to what we have as we get rid of or make our regulatory arms small enough to drown in a bathtub(because heaven forbid we fund them that would be rational.) Having an EPA doesn’t really matter if you don’t fund it or bother to hire enough people to efficiently
What most of us want isn’t a free market but an efficient capitalist market. We want a market that protects us from irrational behavior such as greed and gluttony. We want a market that recognizes the value of not just those at the top but each person that contributes to the bottom line.
Most people participate in this particular market because the rich have managed to effectively lock us into it. They’ve bought both parties and both parties control the regulatory arm that could potentially change market behavior. It also doesn’t help that we have a media which legally disseminates propaganda. That’s why you hear blather such as we can’t raise wages or we won’t be able to compete(which used to be raising wages would result in massive layoffs or $50 cheeseburgers.)
The market exists because trade exists. It is a simply a reflection of society’s priorities. Sadly, in a capitalist based model what it values most is capital(Hence the term capitalism.) In my ideal model there would be room for valuing things like beauty, kindness, or generosity.
Right. And as experienced in the US, the market has been co-opted, from one that worked more or less well for many after generations of struggle for regulatory additions, to one that works exactly as intended exclusively by and for an elite.
The issue is that this is news to no one, not even those hopelessly entangled in conflicting ideologies and propaganda. The issue is that, “Have you no shame?” , doesn’t work anymore. No, they have no shame, none; they are not even aware of the irony.
No one will bother trying to prove that Capitalism is a success in spite of global warming; they will instead say Global Warming is a hoax, and they will say it with a straight face, even those of them that know it is a bold faced lie (and most of them don’t). They have spent the money and resources needed to condition a whole society into accepting such statements by confusion, by fear, by avarice, by what ever. Not necessarily believing, but accepting as the price to be paid for getting to pay again tomorrow.
All that said, I’m awfully suspicious I’m missing something embarrassingly obvious given that it’s wbgonne raising the issue.
Not at all. It’s probably me missing the boat, not you. As I’ve said, I’m not an economist.
One point I will make, however. Obviously, some people deny global warming and they will say what you predict. But the concept of the efficient market suggests that those science deniers must be mixed with the science believers to arrive at the market consensus. Let’s put it this way: even the most ardent global warming deniers must allow the possibility that the scientists are right, and market valuations and resource allocations should reflect that. But, as the Miami Beach building frenzy demostrates, the market has effectively discounted global warming to zero. That suggests that the market is not processing inputs correctly and, in fact, is failing entirely to serve its theoretical function. I suppose I’m just stating obvious but this sure seems to put the lie to the neoliberal fantasy of free-market problem-solving.
On several levels, global warming seems to represent a big shiny display of abject market failure, and this is one shimmeringly clear example. Maybe we should stop what we are doing and consider this.
wbgone
I honestly think it’s because the market is generally focused in present day and less concerned with later on. A rational market would concern itself with not just the short term but the long term. However, this market seems to take the long term position that we’re all going to be dead anyway so loot while you can.
It would probably work better if our regulatory arms weren’t co opted. Energy policy written by Big Oil. Health care policy written by the health insurance cartels. Our food supply guidelines written by Big Agribusiness, etc etc.
wbgonne said : “On several levels, global warming seems to represent a big shiny display of abject market failure, and this is one shimmeringly clear example. Maybe we should stop what we are doing and consider this.”
cwaltz said: “I honestly think it’s because the market is generally focused in present day and less concerned with later on. A rational market would concern itself with not just the short term but the long term. However, this market seems to take the long term position that we’re all going to be dead anyway so loot while you can.”
Perhaps that’s the ‘rationality’ of Mr. Market, bizarre as it is. Maybe global warming isn’t really being “denied” at all, but rather — kenning the fact that “there is no future” — all prices (and decisions) are now based on today.
It makes sense in a strange I-gots-mine Looting Armageddon way.
I don’t think it is at all clear what people want from “the market” or “the economy.” I think they do have a sense of what they want from life and/or from society. And what they know is that the economy rules over life/society. I think most people would prefer an economy that serves the interest of the society (granted that the latter is a very messy aggregation of disparate interests) rather than a society that serves, and serves at the pleasure of, the economy. (Apologies for lack of agency w/ regard to “the economy” in that last sentence but I think most people have a good sense of who the agents controlling what they experience as the economy are.)
EMH [Efficient-market hypothesis] in my readings and deliberations with various stripes seems to boil down to agency e.g. libertarian beliefs about personal freedom i.e. freedom extenuated to the point that even a victim of some market fruad[s rights are diminished – if some agency interferes with the outcome.
Had this exact deliberation not long ago on another blog with some libertarian apparatchik, used Bill Black as a counter point, posted it here [NC] only to have Bill himself respond and the apparatchik hand waved it off with glibertarian homily’s.
Skippy…. seems a case of big enough a fool to inter the game means you brought that Sh$t on yourself plea.
The fundamental issue here is whether we have a market system at all. Among other things, monopoly and concentration cancel the market. So do policies like ZIRP, which is very much in effect in Miami Beach (free money desperately looking for a return.)
Then there are the various sorts of market failure – like health care, mentioned above; or human wishful thinking/blissful ignorance, much in evidence in Miami Beach.
Consider, also, that MB is only one example out of many thousands. Our children – and these things always happen faster than predicted – will have to figure out where to put about a billion people who’ve been flooded out. By comparison, MB is but a pinprick.
Obviously, we don’t have a free market system. Nor do we want one. What we need is a regulatory framework that serves the needs of the entire earth. Within that framework, I am in favour of maximum individual freedom. When there is conflict between individual freedom and harm to others or to the environment, we should err on the side of harm reduction. Concepts such as sustainability should be at the core of our society.
Regarding Miami Beach, Minsky has that figured out. It is nothing else but Ponzi finance.
Well they may also think they will get bailed. Moral hazard is real too.
Another example of market failure.
Yes this high risk property is insured—by US taxpayers. As an editorial from the NYT explains
Just another handout to the rich so they can profit by developing property that should never be built on in the first place. Who wants to bet that there won’t be a push to expand this program, especially from that anti-government program party.
They’ve been expanding it, for the past few years now, at least.
Around here, in upstate NY, there are houses which are now required to have flood insurance. It’s required by the bank if you want to mortgage the property.
None of these houses have ever flooded, or are at risk of flooding. Most owners have walked away from the properties, they can’t sell them, and they don’t want to pay the property taxes.
More blight, but more paying “customers” for the flood insurance program….in theory anyway.
Miami Beach is just a big, shiny example of a much more pervasive problem. Think how many refineries, chemical plants, factories, warehouses, railyards, ports, roads, etc. are located within a meter of sea level. Think of the cost to protect, move, or replace all of them. This kind of thinking quickly leads to the conclusion that from a rational, market based perspective radical system wide action on climate change is an urgent necessity. Since that’s manifestly not happening, I conclude that we, the pants-wearing monkeys, aren’t actually very good at dealing with these types of problems. Your mileage may vary.
Well, “big, shiny examples” are useful because they are … big and shiny. Yes, I am pissing into the wind but that’s what this pants-wearing monkey does best!
No, we’re not at all good at it. I blame Mother Nature – her game, her rules, and she doesn’t give a crap. Evolution doesn’t select for individuals that do long term planning for the good of a species as a whole.
Ernst Mayr suggested that technological intelligence might turn out to be a lethal mutation. It remains to be seen if some set of cultural memes can arise that will effectively counteract the drive to improve one’s own short term reproductive fitness. I’m not optimistic.
We are basically those deer that are on an island and end up rapidly reproducing and eating everything on the island and then almost all of us die off when the island is picked dry of food resources.
We really are not much different from animals at all. We basically follow a similar template.
There are a lot of reasons markets can fail. One is information assymetry – if the sellers know more than the buyers, they can fool the buyers into making poor purchase decisions (or vice versa). If one side or another is politically vastly more powerful, they can tilt the market to their favor by subverting regulations that require honesty, equal treatment, etc.
Even beyond various forms of corruption or dishonesty, there are all sorts of social pressures to do foolish things: many many wealth managers/fund managers have noted that it’s better for their career to lose money by making the same bad decisions as everyone else than it is to make dramatically different decisions than other fund managers. The housing boom is an example of this: people all around you are making millions right now. Right now! Do you stop and pull out for something that may happen years from now? Your funders/investors will not stay long in this environment.
Furthermore, you have the classic principal-agent problem: if the executives or fund managers know they’ll only be around for a few years, they can capture current profit and leave before the comeuppance arrives. Ironically, it actually works the other way too: investors can also capture current profit and likely expect to be able to sell their share in the investment before big problems occur in the far future.
There’s much more, including the extremely short-term thinking demanded by ‘stock analysts’ and ‘investors’. I worked at a defense contractor that did a talent-acquisition of my unit (before I arrived…) and was full of people who had previously pushed the envelope in terms of cyber security research capabilities. But when people requested funding or spare time to continue pushing that envelope, the response was: how do I monetize it in 3-6 months? With that timeline, R&D rarely got funded and a massive outflow of talent continued, which was replaced with younger, less experienced people. And the company’s stock went up probably.
Lastly, on global warming: it’s really important not to think about it too carefully. Think about it superficially, and you might realize you should drive less and use paper bags instead of plastic, and turn off the water while you brush your teeth. Think a little more, and you may have to move, selling your home, and perhaps changing your job. Think a little more, and you may realize you’ll need to give up all manner of comforts you’re used to (i.e. traveling long distances, AC) and perhaps get your fingers in the soil.
Look too far, and your whole identity must change, to the extent you identify with growth, American exceptionalism and goodness, the markets and capitalism, a personal vision of working hard to get rich, etc. For people who have already numbed themselves enough to the world around them to be willing to build new hotels in Miami Beach, that’s a lot to ask.
There’s my two cents.
Thanks for the thoughtful response. Yes, clearly there is a time element at work, with markets increasingly driven by short-term if not immediate factors. But here we are talking about real estate development, apartment buildings, commercial construction, things that are expensive partly because they are supposed to last a long time. Yet it is a fiction to think that Miami Beach real estate is anything other than a rental, short or long-term to be determined by the sea. It seems unavoidable that at some point, and probably very soon, the transient nature of these supposed long-term investments will become clear. Then the market correction should be extreme.
+10.
Look far at all, and you’re quickly beyond the boundaries of what can be impacted by you personally, even if you choose to rise to positively saintly levels. A pretty huge illustration of the “tragedy of the commons.”
Why aren’t the prices of coastal real estate steeply discoubted to reflect the fact that there is no longer “ownership” when it comes to coastal real estate, there is at best long-term renting.
1.) the view, for those literally on the coast.
2.) its human nature to more accommodate the past than some perception of the future.
3.) something like 405 of the US population live on a coast.
4.) maybe the people in Miami that are establishing the price to live on “the coast” in Miami don’t expect to be around long enough to care about a gradual increase in sea level.
5. If “the market” was rational would we have boom and bust cycles? The market is an aggregation of irrational players.
Forigive me is this is inappropriate but I would like to return to Yves’ post yesterday regarding Miami Beach. In the face of impending disaster from sea-level rise, the Miami Beach mayor defends the colossal building boom by an appeal to an unforseen techno-miracle. That might make sense to the mayor somehow but the market is supposed to be rational. Why isn’t it? Why does the market not account for global warming? Why do people keep pouring money into these boondoggles? Why aren’t the prices of coastal real estate steeply discoubted to reflect the fact that there is no longer “ownership” when it comes to coastal real estate, there is at best long-term renting? I suspect that one of the big drivers of global warming denial is that accounting for global warming will roil the economy. But that is human thinking, wishful thinking, denial. The market is claimed to be efficient and ruthless. Why isn’t it in this instance?
Sorry for the double-post. Not sure what happened there.
Lambert has stopped complaining about those. I think the system itself is doing it, at random, and not often enough to be worth fixing.
Ordinarily, it won’t LET you double post, even if you try (accidentally).
https://www.washingtonpost.com/opinions/trump-exploits-a-crack-in-the-gops-foundation/2015/11/12/82cf5628-8978-11e5-9a07-453018f9a0ec_story.html?wpmm=1&wpisrc=nl_opinions
“…the modern Republican Party has built its ideology around three planks: economic conservatism, traditional social values and hard-line foreign policy. The problem for the GOP is that in all three areas, its followers no longer believe in the party’s long-standing ideology.
…Republicans have been united around the belief that government spending is out of control. The problem is that there are only two ways to significantly reduce the debt and deficits: raise taxes or cut Social Security and Medicare. Since the former is anathema to all Republicans — indeed, they want tax cuts — most conservatives propose paring down entitlement programs. That remains the centerpiece of House Speaker Paul Ryan’s (R-Wis.) appeal to conservatives. But the bulk of the Republican electorate is elderly, and they are increasingly making it clear that they disagree.
The third plank, an interventionist foreign policy, is in some ways a legacy of the Cold War and was central to Ronald Reagan’s success. In its DNA, the Republican Party was historically more nationalist than internationalist, and isolationist rather than interventionist. It is returning to those roots. More than half of Republicans said in 2013 that the United States does too much to help solve world problems and should mind its own business.
Again, Trump gets it. He has increasingly favored nonintervention. He argues that we should not have intervened in Iraq and Libya and should not do much in Syria. He wants the Europeans to take the lead on confronting Russia over Ukraine. When asked by NBC’s Chuck Todd whether Ukraine should be a member of NATO, his answer was extraordinary and revealing: “Whether it goes in or doesn’t go in, I wouldn’t care.” I would wager that most Republicans would agree.
===============================================
First, not one vote has been cast. Last time, Romney wasn’t in such good shape either. One could argue that Romney had such difficulty because he was at the very beginning of the base insurrection.
And I would add most republican base voters do not believe Bush 43 presided over nirvana.
So….is this a real paradigm shift, or just another example of hoopla due to the proliferation of “news,” blogs, and other communication outlets?
Maybe the answer as to whether the status quo is safety ensconced is what happens with the democrats???
Inertia is a powerful force. The question is: is the downward spiral enough that people are willing to try something new?
If I really had to put money down, I would still go with Jebbie versus Hillary.
But if its not…
Im putting my money on Rubio. All the billionaire bucks seem to be jumping ship from jebbie to him. They gotta know something.
You think their money will buy them happiness?
No idea what they know (seems to be very little these days), but not only did Rubio and Bush serve as Florida state officials during the same time, but Rubio was Chang. Jeb! sure has a strange way of unleashing.
Well, if they were wrong about Bush in the first place, why would you think they “gotta know” any more about Rubio than they did about the last horse they bought millions of win tickets for?
I think what they know is that they’d like the closest thing to an establishment candidate that they can get. Which only leaves Clinton and Rubio if they bail on Bush.
Lambert, thanks for the charming, vintage Hachikō photo. Along with a zillion other tourists, I’d seen the statue outside Shibuya station years ago, but never a photo. (And I gave the Richard Gere movie version a miss.)
I tune into the Guardian most mornings for my first news fix and it was all about “Jihadi John” with a half dozen photos or so… honestly, these terrorist nicknames. And don’t they realise it is just whack-a-mole in any case? I’m with Ron Paul on this one — just bring all the troops home, and save a trillion dollars or so as well. 14 years in Afghanistan and nothing to show for it except an unused $43 million gas station and a Harry Shearer “Karzai Talk” T Shirt.
(And of course the US merrily funds uber-beheading Saudis and their genocide against Yemen… why aren’t they “targeting” the Saudi leaders?)
Look! Over there! Jihadi John!
The Brits had 60,000 casualties on the first day of the Battle of the Somme. And here we are, focusing on one guy, and trying to whack him with fabulously expensive high-tech weaponry. Something doesn’t add up.
And it’s only definitely maybe quite possibly hopefully could well be Jihadi John. Why not wait until there’s a unequivocally positive identification? Ah, because that might never be forthcoming. So I guess the thinking is why not grab the good messaging while you can. If it turns out to all be a mistake, who’ll remember?
The cynicism we’re treated with by our governments makes me so cynical.
One way to increase the certainty would be to ask, 1) Was he at a wedding? 2) Were there children present? 3) Was there at least a 50% or greater chance that it was someone else entirely?
If all three answers are YES, then it looks bad for him (or whoever).
Its all about consumer impressions. News as entertainment
Love the antidote. Every time I see him I tear up a little bit.
With robot dogs, we will see more of that kind of loyalty.
Depends on the code.
Re: Yazidis
It’s only genocide between the periods Uncle Sam is paying for it.
Do pesticides lead genocides?
That would be a worthy science project.
I don’t think Apple has the chops to run a true deposit bank – unless it buys one outright – someone like Ally with no branches. That’s the only wait I can see that happening. No way can I see them starting a bank from scratch.
They want a bank like paypal. A bank in every sense of the word, just not regulated like one. They trade the privacy of the people who use it for a complete lack of regulation. PP has a long standing policy of giving anything and everything they have to any law enforcement agency that asks, sans warrant. This apparently buys them out of any sort of oversight themselves.
It sounds like a match made in heaven for a vending machine company. “We’ll give you everything, just don’t call us a bank!”
The War on Deflation has developed not necessarily to our advantage:
Dr Copper has been hinting at this turn of events for some time now. But JYel & Co. wouldn’t listen …
That’s Dr. Copperson, nowadays.
Besides, what Obama tells Janet to do will depend on whether we are at war with Eurasia or Eastasia.
Re: Peter Drucker and Automation-HBR
Couldn’t help thinking that his observations, warnings and recommendations were evolving and reconciling in real time at places like Mondragon. While no place can claim being utopic, they seem to have resolved many of the issues plaguing other places. Their way of organizing “labor” seems to have worked out better than other “models”.
FWIW, according to Mikel Lezamiz, director of Cooperative Dissemination at the Mondragon Cooperative Corporation in Spain’s Basque Country: “In most of the cooperatives, the biggest differences between the top and the low is one to 4.5 times. But the biggest, the CEO of Mondragon, is earning six times the minimum minimum salary”…compare that to the absurdities elsewhere…
http://www.democracynow.org/blog/2013/3/25/video_understanding_the_mondragon_worker_cooperative_corporation_in_spains_basque_country
I can tell you why the alleged death of “Jihadis John” is trumpeted high and low: because the Syrian Army, backed by Russian air power, has scored major successes lately against ISIS.
The US “round the clock” bombing has appeared impotent at best. At worst people suspect that, despite the rhetoric, the administration doesn’t really mind if ISIS wins, so long as Syria loses. Of course, that’s terrible optics.
The upshot is that the US has to look like it is doing something.
ISIS has a few bad apples, but if we clean up the organization, they will make a fine moderate Islamic State.
Woohoo! Move the goal post and they can be like the “moderates” that took credit for flying planes into the world trade center.
Our foreign policy would be laughable if it weren’t actually responsible for so much death and destruction.
Well, some are laughing all the way to the bank or the halls of power…
Thanks for the CAP/Israel article. One implicitly knew that anything Podesta was involved with was corrupt, but this was pretty shocking.
Hachikō waiting in the railway station:
http://direitosdosanimais.org/website/noticia/show.asp?pgpCode=38AAD53C-C79E-1D86-6673-57C449674C5E#.VkSUSdmVPDM.facebook
> Tech companies, labor advocates, and think tankers of all stripes call for sweeping reforms to the social safety net Washington Post. Not to help workers or stimulate demand, but to facilitate the growth of the “sharing” economy.
Well, if something this stupid is what it takes to finally get healthcare reform, bring on the sharing economy.
But, again, amazingly no mention of single-payer in the article, which should be a no-brainer both for companies that don’t want to offer health insurance to their employees’/contractors’ and for their workforces. It’s almost as if it is an intentional oversight.
I was wondering why we should care about Tina Turner’s endorsement; is this something about Mad Max and the Thunderdome? Then I realized it’s Nina Turner. Perhaps I’m due for a visit to the optometrist.
I find it strange that theres no articles on Catalonia? Am I missing something, because from what im reading Catalonia getting ready to secede from Spain is a big deal.
Some terrible stuff happening in Paris right now. 100+ killed.