Wednesday, August 31, 2016

Hey, Ricky, how will you keep American rapists and killers out of your country?

BI: Mexican President Enrique Peña Nieto said on Wednesday thatMexico would not be paying for Donald Trump's proposed wall along the southern border of the US after his meeting with the GOP presidential nominee.

Brian Kelly, California transportation official is a liar

LA Times: Transportation officials have selected 14 public transit projects across California for a slice of proceeds from the state's auction of greenhouse gas pollution credits, almost $391 million in spending between now and the summer of 2018.
"Every dollar we invest has to have a greenhouse gas benefit," said Brian Kelly, secretary of the California Transportation Agency.

I highlighted the lie.  The energy efficiency of current California mass transit systems is way below the typical automobile efficiency, end to end.  Brian knows he is lying, he is reradibng off the environmental checklist which says, 'Always pretend mass transit is energy efficient'  Brian's problem is that he is an idiot, he does not yet know he is required to lie; he thinks he is just repeating the standard line.

The EPA wants to inspect your goodies

The Blaze: The Environmental Protection Agency will begin collecting employee data on sexual orientation and gender identity to help LGBT employees “feel included,” according to an internal agency email sent by EPA chief of staff Matt Fritz last week.
“A professional, productive and inclusive workplace is essential to our mission of protecting human health and the environment,” Fritz told employees in the email, according to the Washington Free Beacon.

Kevin Drum, always trying to justify racist policy and pandering

HBR cites a book on racial stereotypes:She (author) studied hiring committees at professional services firms that believed they were ensuring rigor and counteracting bias through group discussions of job candidates from the school-recruitment pipeline. But those conversations actually dampened diversity by giving negative racial, ethnic, and gender stereotypes greater sway over decisions—particularly “in ambiguous situations, where the quality of a candidate [was] not clear.” In those cases, Rivera points out, “stereotypes served as an unconscious navigational system, guiding interviewers’ attention to where they should focus and look for clues in order to figure out if the candidate did or did not have the right stuff.” This gave evaluators “a common lens and shared language” when they didn’t immediately agree on someone’s value to the organization.

So her statistical anaklysis and control were effective when she observed some hiring committees?  No way, I did not tread the book, and do not intend to.  But the likelihood that this author was able to detect subtle stereotypes from observations of hiring committees is ludicrous.

Then Kevin Drum picks up the theme.  His logic is that if merit is not accounted for correct then hiring committees must be racist!  Kevin Drum is always looking for new ways to pander to the races.  My suggestion to the Dem party, find the platform in your party that specifies pandering by race, remove it.

Obamacare, unsustainable

Iowa Insurance Commissioner Nick Gerhart appeared on CNBC yesterday to explain his decision to approve rate hikes as high as 42% in his state. Echoing comments made last week by Tennessee’s Insurance Commissioner, Gerhart said the Obamacare market was “troubling” as the result of “adverse selection.”
“This really is a math problem,” Gerhart said. “The carriers have had sustainable and large losses so our position is we have to look at the rates for adequacy for the carrier and affordability for the consumer as well,” he said. “It was a really tough decision and I hate to increase rates by 42.6 percent but it really had to happen for our market to be sustainable,” he added.
One of the CNBC hosts suggested the Obamacare marketplace was “broken.” Gerhart replied, “The risk mitigation tools, the three R’s, really didn’t work very well to be honest and the carriers just really need more predictability in the pricing to be honest, so it needs a lot of work.”
Asked what could be done to fix the program, Gerhart said, “Well, it’s a challenge. You need to have more people in. You need to have healthier folks in, you know, the young people are not buying product as it’s too expensive to be honest with you.” He added, “It’s adverse selection. Those people that are buying are a little more sick than the carriers priced in and it’s a real troubling market right now.”

Donny and Ricky have a meeting

What should Donald say? 
PoliZette: GOP presidential nominee Donald Trump will travel to Mexico on Wednesday to meet with Mexican President Enrique Peña Nieto, LifeZette has confirmed.
Sources including Mexican officials involved in the planning of the visit, who spoke on the condition of anonymity, stated the meeting would cover a broad variety of topics ranging from trade to security to immigration and the contentious issue of border enforcement.
Don should say that any North American country which mass murders teachers and students is at war with the USA. 

Chicago is a goner

PJ Media: We turn our attention once again to the city of Chicago, where, as of this writing, 2,858 people have been shot and 487 have been killed so far this year (both numbers will surely be higher by the time you read this). The tabulates these and other figures related to crime in Chicago, and it reports that on average someone is shot every two hours and murdered every twelve. But these averages are for the year overall; we are now in the prime shooting season of summer, and the averages for August approximate to someone being shot every ninety minutes and murdered every eight hours. August, says theChicago Tribune, has been the most violent month in Chicago in 20 years.
Despite these grim numbers, there persists among many the notion that it is the city’s police officers who bear the greatest share of blame for all that ails Chicago. Propagating this myth most recently is this same Chicago Tribune, which on Friday published a story about the 435 police shootings that occurred in Chicago between 2010 and 2015.
What is happening in Chicago is a Kanosian war crime. 

Commercial real estate had a nice run

A 8-10% yield since the crash,

And from Zero Hedge we see foreign investors find that attractive:

And most of the investors are from Asia, namely China.

California politicians rule the Obama administration

City Journal: Last week, the Obama administration’s Department of Labor released new rules allowing states to sponsor pension systems for private-sector workers whose employers don’t offer retirement plans. The decision could ultimately drive trillions of dollars of employee money into the hands of the same state officials who have mismanaged public pensions for years. What could possibly go wrong?
And California:
LA Times: Ca lifornia has taken a step closer to becoming the first state to make retirement savings accounts a near-universal benefit for workers with a plan that lawmakers hope will help ease an expected massive shortfall in retirement savings.
A state board Monday sent a set of recommendations to the Legislature calling for the creation of the California Secure Choice Retirement Plan — essentially a 401(k) plan operated by the state and open to private-sector workers whose employers don't offer a retirement savings plan.
Employees of any company with at least five workers would be eligible to participate. That would cover an estimated 6.8 million workers, about a third of California's labor force.

Rethink Ricardo

Do individual agents in the economy anticipate higher taxes upon fiscal stimulus?  Economists can do better.

In our case, individual agents are expecting the usual 25 year entitlement update.

Agents are expecting a transaction between the overlapping generations in Congress, update the entitlements to the demographics; a mark to market.  Until that happens, the current natural rate is unknown and interest rate risk is rising.

Failure to do a demographic update to entitlements effects pensions in general since future liabilities are yet to be determined.


1) The economist model is assumed to work, therefore it is spectrally consistent.
2) We know the spectrum, it's the yield curve where we find five ranges of motion, the two year, five year, ten year and thirty year.
3) Since this spectrum is very sparse we expect large volatile transactions on cycle boundaries.

From then on is a matter of matching motion to sectors; namely housing and entitlements have the 30 year motion.  It is time for government(s) to mark to market.  Once we have an update, then they will take gains and losses, as incurred in the past.  These would namely be mis-calculations on the price of retirement, mis-calculations mainly due to the sparse spectra, price discovery becomes rapidly more uncertain as the update is delayed..

Tuesday, August 30, 2016

Here is a recession indicator

Personal income taxes (Blue), they have peaked for the current presidential recession cycle. Note the deficit jumps (red line going down), shortly after taxes weaken.  Looks to me the recession is imminent. and it's a whopper.  But, that is one indicator with two hits and one false positive.

This economy, especially the politicians, plan recessions.

Not allowed to pay the same tax twice

Yahoo: European authorities have clamped down on a special deal between Apple (AAPL) andIrish tax authorities, saying the arrangement uniquely favors Apple and is unavailable to other companies. Nixing the deal—which lowered taxes on much of Apple’s foreign income to virtually nothing—will force Apple to pay taxes in Ireland at the higher rate other companies pay. The bill: about $14.5 billion.
But Apple may get reimbursed for all of that by an unlikely benefactor: the US taxpayer. “It’s extremely possible the US taxpayer will have to pay this bill,” says Stuart Gibson, a former government tax official who’s now editor of Tax Notes International. “For every dollar in tax Apple has to repay in Ireland, they may get to reduce their US tax bill by $1.”
The foreign tax creditThat provision is known as the foreign tax credit, which unlike much of the tax code is fairly simple, in concept. Under the US code, American companies doing business in foreign countries pay tax in the US as well as where they earn the revenue being taxed. In order to prevent companies from being taxed twice, companies earn a 1-for-1 credit on their US tax bill for taxes paid overseas.

There is no infrastructure spending in California

Business Times: It was the boldest California housing policy proposal in years: Allow any residential project that complies with local zoning and sets aside as few as five percent of its units as affordable to be built "as of right," removing review from local municipalities. The idea was to fast-track approvals and reduce the cost of building as the state struggles with a crushing housing crisis.
But after three months of debate and widespread opposition, the proposal by Gov. Jerry Brown, meant to boost the state's housing production in the face of record-high housing prices, appears to be dead. State Assembly speaker Anthony Rendon said last week that discussions on the proposal were over, as first reported by the Sacramento Bee. The state's Department of Housing and Community Development, which has been advocating for the proposal on behalf of Brown, declined to comment on negotiations.

Jerry Brown killed the bill because unions objected:

Construction unions sought a major modification in the proposal: requiring projects that benefitted to ensure minimal construction salary thresholds equivalent to union wages through prevailing wage agreements. Ben Metcalf, director of the state's Housing and Community Development, told the Los Angeles Times that requiring prevailing wage would discourage some developers from using the program. Requiring higher wages would remove the financial advantages of using the program in some cases, he said.
 The union block is directly supported by Kanosian idiots who claim infrastructure spending has good multipliers.  But the Kanosians themselves have to go along, they have university jobs because the unions hire them using public money.  California is bankrupt because of Jerry Brown and the union overlords.

The predictable backlash in favor of cops

Daily Caller: As Justice Department civil rights lawyers held a meeting to talk about overhauling the Baltimore police department, another group of Baltimore residents gathered to beg the police to fix the crime in their neighborhoods.
The meetings show a disconnect between those who are concerned about crime and those worried about police reform, reports the Washington Post. Neither group was aware the other one was meeting.
About 40 people, most of them older black women, gathered in a West Baltimore church basement to ask police to return order to their community.
A gas station owner whose parking lot had been taken over by loiterers begged for help; a 17-year old was also fatally shot there. Another man asked about the foot patrol officers that were promised to the community.

Neighborhoods like the police because hey chase criminals.  Sort of obvious.   Colin's idea is a non-starter, he wants better trained cops as do a lot of folks/.   But the taxpayer cannot afford higher salaries. 

Monday, August 29, 2016

My hometown, in the news

We are number 15 in the list of hot housing markets currently.

A bit of chemical warfare in Cincinnati

An overdose crisis in Cincinnati for the past six days has left police and emergency responders drained, and for now, without clues. It has also underscored that the region does not have the resources to treat all of the addicted.
Police are asking for the public's help in identifying the source of purported heroin sold to people in Cincinnati, mostly on the West Side, that caused scores of overdoses, including at least three deaths.
"We're working very closely to find the source dealer," said Newtown Police Chief Tom Synan, who heads the law enforcement task force for the Hamilton County Heroin Coalition. He said local, state and federal authorities are combining their forces to investigate the source or sources. "We don't have anything solid to go off of."
With an estimated 78 overdoses Tuesday and Wednesday alone, and an estimated 174 overdose cases in emergency rooms in less than a week, officials are scrambling to attack a heroin crisis of a magnitude they've never had before.
My hometown of Fresno has meth hotspots, houses where someone has access to high quality meth.  When a hot spot shows up, the crime rate jumps in town.

I start Herky the Hawk defense committee

A professor at the University of Iowa is concerned that the school’s hawk mascot, Herky, looks angry — and its appearance could be contributing to a culture of violence, depression, and even “suicide.” “I believe incoming students should be met with welcoming, nurturing, calm, accepting and happy messages,” clinical professor of pediatrics Resmiye Oral, wrote in an e-mail to the school’s athletic department, according to an article in Iowa City Press Citizen.

Resmiye, dear.  Your name scares the shit out of me, who gave it to you?


Tiny bots are proliferating

The age of tiny bot is upon us. 

Bots abut the size of a tab of butter. They have GPS and can control movement mechanisms.

Some wander about the house taking video from an insect perspective, some fly paper airplanes, attach them to your tennis racket and record movement, attach them to your child, have them crawl up your tree. They will make child toys creepy and programmable, a deviant delight.

You a farmer? Put these cheap bots on top of sticks and set them around your field, get and instant close up view, control your irrigation. These bots can do precision weeding, like a gardener, when attached to the back of an intelligent plow.

Put the bots in water proof bubbles and toss them into the sea for continuous temperature and current measurements. Tiny bots drive the fracking business in oil.

Jobs? Get into bot software, not just program but assemble components of bot software for specific applications. Produce generic bot hardware, a huge business of add ons. lidar models for spatial recognition, like radar. Components and parts for that add on business is huge, and growing fast. Add on the micro step motors used for actuators. Everywhere, a globe with a dusting of silicon intelligence just about everywhere.

Prohibiting bank runs

The new rules for money market funds restrict withdrawals under certain conditions.
Yahoo: A large portion of the financial markets, and one that played a pivotal role during the financial crisis, is about to undergo substantial changes.
At the core of the rules is an effort to stabilize the $2.7 trillion industry, which provides a generally safe climate where both retail and institutional investors can park funds and earn modest returns with the bonus that they will never lose money.
For a brief moment in time, that compact was broken.
In 2008, as the financial world crumbled under the weight of the financial crisis that took down Wall Street and threatened to crush the global economy, one fund did the unthinkable: It "broke the buck." That means its share price fell below $1 due to heavy losses it experienced from the collapse of Lehman Brothers. The move by the Reserve Primary Fund set off a wave of panic over possible redemptions and the implosion of a sector that at the time boasted nearly $3.5 trillion in assets.
The new rules seek to prevent a similar occurrence in the future. They allow all funds to block investors — using what are known as "gates" — from withdrawing cash during times of market volatility, a move that coincides with a mandate that retail and government funds maintain a $1 share price. The rules allow prime institutional funds to move to a floating value, meaning they have the possibility both for greater return and greater risk.
Depositors bear the risk and may be forced to leave money in the account much longer.  That means the money market curve is shifting right, it is no longer a demand deposit to park money short term.  So the players are moving to the government debt markets. 

7 out of 10 killers in Chicago are African-American

4 out of every 5 people shot by Chicago police were African-American males

Obamacare, unsustainable

Administration announces new Obamacare rules as media admits the program is in trouble

The Kanosian strategy of 'wish fulfillment' failed. 

Facebook is a lousy media company

Their news articles are dull and boring, the site tires me.

Obama's Muhammudite friends

A video supposedly from a muslim school in the UK.  The teacher is explaining why it is necessary to kill gays and Islam rejecters.

No more Huma on the Weiner

Huma Abedin and Anthony Weiner are splitting up

You say inflation, I say deflation

The price changes that have passed.  If you want stable inflation expectations, then the positive changes have to swap places with the negative changes.  

Where is the inflation? Mostly government sponsored monopolies.  So much to fiscal multipliers.

President Trump

Says the LA Times tracking poll.

Swamp spending going bzonkers

Rank-and-file GOP fear lame-duck vote on pricey funding bill
We have the usual, it is presidential election time, Congress has lost any common sense on the budget, eight years of credit spending needs to be 'portfolioed' off somewhere, and taxes are not growing, so the deficit is now increasing.

Congress is incapacitated, any budget shocks will be handled by short term credit, and rate, recently, have begun a mild climb upward.  Hence, Congress, whatever is action, will deal with a tremendous feedback in the budget due to interest costs and rising short term rates.  These are ripe conditions for a recession, a recession caused by the Swamp, using short term debt, and that is not a good fiscal multiplier folks.

Let's look at the Fed portfolio and ask, has it starting buying short term notes?

Yes, the green line rising are 3 month to 12 month treasuries  held by the Fed.  The Fed is actively trying to lower the one year treasury rate.

 The one year is at .62%, and a sudden short term spending demand by Congress pushes that up to 1%, easily.  The curve will invert or Congress will suffer a ten year rate moving toward 2.5%, and that projects a near term crunch in interest costs, as the rollovers come in.

Writing new contract law

WA Post reviews the California Rule on public pensions.  The California Supreme Court expanded public labor contracts to include an implicit guarantee for future pension vesting.  This is new contracts law, a pure fiction imposed on specific forms of employment contracts, Sotomayor style.  As a result, public sector employment contracting has been a severely inefficient process.  There is no viable rule; at any time the Supreme Court can make up impositions on existing contracts, Sotomayor style.  This bungles up the economy something fierce.

The California rule was created in 1955, when the California Supreme Court considered a challenge to a 1951 city charter amendment in Allen v. City of Long Beach (Cal. 1955). The amendment raised the amount of employees’ retirement contributions from 2% to 10%. It changed the pension from a fluctuating amount (based on the salary attached to the retiree’s previous position at the moment pension payments are made) to a fixed amount (based on the retiree’s salary around the time of his retirement). And it required extra contributions from employees who had returned from military service.
The Court held that the amendment unconstitutionally impaired the contract rights of the employees who were adversely affected. In doing so, it stated a test that would be often repeated in public employee pension cases:
An employee’s vested contractual pension rights may be modified prior to retirement for the purpose of keeping a pension system flexible to permit adjustments in accord with changing conditions and at the same time maintain the integrity of the system. Such modifications must be reasonable . . . . To be sustained as reasonable, alterations of employees’ pension rights must bear some material relation to the theory of a pension system and its successful operation, and changes in a pension plan which result in disadvantage to employees should be accompanied by comparable new advantages.

What was going on in  the 50s that caused such ignorance on the part of the state court? 

Middle Easterners still have not figured out the large crowd problem

SANAA, Yemen -- A suicide attacker set off a massive car bomb in Yemen’s southern city of Aden on Monday, killing at least 45 pro-government troops who had been preparing to travel to Saudi Arabia to fight Houthi rebels in Yemen’s north, officials said.
The men were at a staging area near two schools and a mosque where they were registering to join the expedition. The Saudis hope to train up to 5,000 fighters and deploy them to the Saudi cities of Najran and Jizan, near the border, Yemeni security officials said. Over 60 wounded were being taken to three area hospitals, they added.
I count some ten times that middle eastern authorities required young men to crowd up in the street as part of police employment. The crowd generally gets blown up, but recruits do it again and again. 

Sunday, August 28, 2016

My socialist plot to solve the baby boomer health bulge

Make them go to the gym and eat healthy food.

Here is how it works.  Their primary physician prescribes a weekly treadmill or cycle regime in the gym.  It comes as a walk in the woods via virtual reality, so the boomers exercise painlessly, they are in dreamland.  After their treadmill walk in the woods, they earn points which they can spend in the gym cafeteria.   

This program delays, and spreads out their heart disease, we keep them herded in the gym where they cannot do bad habits and eat healthy.  The boomers will love it because it is cheap and keeps them alive.  The net cost reduction is that we have far fewer cardio patients.  They can die of natural causes, like tennis, or just live in the matrix.

California's partner nation

Business Insider: Violence in Mexico has been on the rise in recent months, as fragmented criminal organizations clash around the country, competing with Mexican authorities and each other for control of illegal enterprises.
Data released by the Mexican government reveal that homicides, perhaps the most visible aspect of the country's violence, reached an ugly milestone in July.
The 2,073 killings recorded that month were the most of any month since the current president, Enrique Peña Nieto, entered office in December 2012, and it was the first time the country exceeded 2,000 homicides in a month since August 2011.
This kind of crime certainly scares the Yanks up north. 

That rate of crime looks like a complete breakdown, armageddon, warrior stuff. 

California court ruling on public sector pensions

California Policy Center: On August 17, 2016 the First Appellate District Court ruled on the lawsuit brought by the Marin Association of Public Employees against the Marin County Employees’ Retirement Association (MCERA) and State of California. The case was brought after MCERA eliminated pay items considered pensionable following the States enactment of the California Public Employees’ Pension Reform Act of 2013.
The Act mostly just enacted lower benefit formulas for employees hired after 2013. For existing employees, the Act did little of substance other than attempting to eliminate pension spiking, which is the practice of increasing an employee’s retirement allowance by increasing final compensation and including various non-salary items such as unused vacation pay, pay for uniform allowances, pay for equipment or vehicle use, and adding service credit for unused sick time, vacation time or leave time.
The Marin County Employees Association sued claiming they were entitled to those benefits because they were a “vested right” based on the legal theory that once a pension benefit is enhanced it can never be taken away, something commonly referred to as the “California Rule”.

When you hire on in the public sector you are promised a retirement vesting schedule.   If the vesting schedule is changed, then the employee must be compensated, proportionally according to time worked under the prior schedule.  The employee then has the choice to quit, the contract is honored; also the agency has the chance to fire the employee.

Why is this a court case?  The ruling is obvious to any bonehead hiring agency, why wasn't it stated in the employment contract in the beginning?

Saturday, August 27, 2016

You call it inflation, I call it deflation

Congress doing bad in the medical industry

Anti-Media reports on the EpiPen scandal.  This is a case of Congressional protection of an artificial monopoly via lobbying power alone.  In other words, Congress raises the cost of medical devices.

The FDA, Washington, and Crony Capitalism Are All to Blame
Though the EpiPen is not covered by patent protection, Bresch’s close relationship with Washington may have helped her company ensure competition wasn’t an issue.
In an article for the Mises Institute, Jonathan Newman writes that “Mylan has been repeatedly protected from competition, and it has repeatedly (and predictably) increased the price of EpiPens in response.”
According to Bloomberg, Mylan has been aggressive in its approach to regulators.
For the past seven years, Bresch has been “[turning] to Washington for help. Along with patient groups, Mylan pushed for federal legislation encouraging states to stock epinephrine devices in schools.”
In 2010, when the FDA launched new federal guidelines related to epinephrine prescriptions, Mylan stoppedselling single pens, switching to twin-packs. Bloomberg reports that, at the time, “35 percent of prescriptions were for single EpiPens,” but as the new rules were implemented, Mylan “changed label rules to allow the devices to be marketed to anyone at risk.” While the guidelines targeted persons who had severe allergic reactions only, Bresch saw the rule changes as “big events that we’ve started to capitalize on,” she said in October of 2011.
After a seven-year-old died due to an allergic reaction to peanuts at a Virginia school, Congress passed a law pressuring states to ensure its schools had epinephrine devices on hand at all times. The year this bill passed, Mylan spent over $1 million in lobbying alone. Now, Bloomberg reports, “47 states require or encourage schools to stock the devices.”
As part of the EpiPen popularization plan, Mylan started handing out “free EpiPens to more than 59,000 schools” in 2012. In 2014, the company allegedly spent $35 million on TV ads, and in 2015, Mylan signed a deal with Walt Disney, stocking theme parks and cruise ships with the devices. Between 2012 and 2015, the company alsospent over $6 million in lobbying.
Over the past seven years, Bresch’s persistence and power-driven attitude helped the company spread the EpiPen far and wide, causing its use to grow 67 percent in the United States. EpiPen prescriptions are now so common that pediatric allergist Robert Wood from Johns Hopkins University School of Medicine says EpiPen is the new “Kleenex.”

Increasing currency costs for foreign treasury buyers

Bloomberg: Asian currencies look set for a bumpy ride over the next three months after Federal Reserve Chair Janet Yellen said Friday that the case for an interest-rate rise has strengthened, amid growing speculation the hike could come as early as next month. Yellen’s statement will create some volatility over the next three months, Raymond Yeung, chief economist at ANZ Banking Group in Hong Kong, said by phone. “The cost of the U.S. funding will increase, and Asian currencies will be under downward pressure.”

Using economic terms, by what channel will this increase ten year safe rates?  The currency risk channel for foreign holders of US  treasury bonds.  They have to redeem and spend in their home economies where they locate, they suffer the risk of currency exchange.   That raises the minimum acceptable yield foreign investors will accept.  That number was 1.5%, on the ten year, now it is above 1.6, closer to 1.75, likely.  We have a bottom on the ten year yield.  And we have a top, around 2.5; after that, interest payments will bear down on government finances.  That is a narrow corridor.

The US Congressional budget is becoming less liquid, more constrained by legal entitlement obligations.  Hence, when we could suffer 22% of the budget toward interest, we can now suffer only about 15%.  The government corridor for price discretion is closing, especially the state and local governments struggling with pensions.

Rate and Term delusion

If we examine what the Fed does in an overheated economy, we find events are changing rapidly.  Most of the new information for the Fed comes from the last two quarterly results.  Conversely, during long periods of low growth and low volatility, the Fed needs to look back two years, two sets of annual numbers to find anything innovative.

Accountants always use annual rates in comparing yields, for a very good reason; annually every economy completes one seasonal cycles, seasonal effects are cancelled.  But in the two cases above, the first, the target rate is the six month rate, and in the second it is the two year rate.  This follows directly from applying Shannon to information efficiency.  The two previous significant events have the best predictive power, it is best to 'mark to market' all the  significant events prior to the last two.  I think this is going to be fundamental in spectrum constrained, self adapting statistics. In number theory this is about 'conserving divisibility'; divisibility ans spectrum play similar roles.

Consider the recent puzzle regarding seasonal adjustments, why did we have this Q1 slump start showing up?  Well, it had to happen two years in a row before we were convinced.  

Its like a combinatorial problem, we have a defined sequence of partitioned groups we can make, in which we maximally use prime numbers and make the best quotient ring.  When we do this, pricing is most efficient,meaning we can multiply and divide prices for longer estimations with respect to some artificial variable like the year. Once we set the first partition, the prime twos separation, then we set the spectral conditions for the remaining aggregates, we know where the knee of the yield curve will lie, with respect to artificial time.

Are we in a dollar bubble?

It looks like a long term declining volatility in the dollar, and it looks uncorrelated with recessions.  I would say the dollar has peaked.

Friday, August 26, 2016

Some typical statistics on voter ID

It has been in the new lately.  I pulled some stats, nothing accurate, but I saw 15% of Blacks and 6% of whites without personal ID.  We have to drop half of these as folks who are hiding out anyway, and of the remainder,about half cannot read the ballot and are a coin toss.  So, skip the race issue, the marginal numbers lost or gained are not worth the effort.

The bigger issue is the huge class of potential voters who already have photo IDs, the NAFTA citizens, the folks who carry a personal ID from the state in which they reside, and a photo ID of their native NAFTA country; and they vote at home by mail.  These folks act as if they have a legal NAFTA visa, although the regulation is horrible.  They are not likely to jeopardize their visa status by voting illegally.  These folks, most of them, just want the NAFTA visa regulations defined.

It is this sudden discovery by Nancy that these folks will all suddenly decide to break the law every eight years?

This is Magic Walrus failure

The Hill: State insurance officials say they are feeling pressure to approve large ObamaCare premium increases to prevent more insurers losing money from dropping out of the market altogether.
Tennessee’s insurance commissioner, Julie Mix McPeak, this week announced the approval of premium hikes of 62 percent, 46 percent and 44 percent, respectively, for the three insurers on the state’s marketplace. 

There is not, after all, an infinity of infinitely divisible insurance companies.  So, on the frontier of Obamacare we have discrete jumps in pricing as side effects become uncovered.  The middle class ain't that liquid and cannot cover the yearly Q1 jolt to the pocket book..

Thursday, August 25, 2016

There's your deflation

If there was any confusion about how the lower half of the US consumer class is doing these days, it was quickly lifted following today's distressing earnings calls of dollar store titans, Dollar General and Dollar Tree.
Discount retailer Dollar General said it was cutting prices on its most popular items such as bread, eggs and milk, intensifying a price war among already commoditized products with retail giant Wal-Mart Stores to win back falling market share. It shares fell the most on record, plunging by 18% after the company missed on revenue, blaming aggressive competition, lower food prices and reduction in SNAP, or food stamp, coverage in 20 key states.
 Too much supply, too little demand.

The real immigration problem

Well, one of the main issues, anyway.  Where should a North American citizen vote?  They should vote in the election for the nation marked on their national ID.  That covers most immigrants, they are North American citizens.

What  right do North American migrants have in other North American nations.  Their national ID crd gives them lightly regulated NAFTA visa privileges,.  Figure out what those are later.

Problem? No, except Nancy Pelosi suddenly wants to make them all vote in America every eight years, she causes this whole mess.

Consumer deflation in Japan

Spending less and saving for retirement.

Can we sue the guy for racketeering?

The Duran: While Soros has managed to thoroughly destabilise the European Union by promoting mass immigration and open borders, divided the United States by actively funding Black Lives Matters and corrupting the very corruptible US political class, and destroyed Ukraine by pushing for an illegal coup of a democratically elected government using neo-nazi strong men…one country that Soros has not bee able to crack has been The Russian Federation.
Also, there is a bit of treason involved. 

Brad going for monetary regime change

Delong: If we do not now start planning for how to implement helicopter money when the next adverse shock comes, what will our plan be? 
I have an idea.  Instead of flying the copter every 55 years, let's fly it every three years. 

I had a 'one foot tall' stack

Eric Trump says his father’s tax returns are ‘five feet tall’ and should not be released

Mine was a work of fiction, I damn near wrote a novel.


Hillary Clinton: 'A fringe element has effectively taken over the Republican Party'

We're gonna need a new name. It has to be a secessionist party, no other will do.  Our motto is: 

Homelands for the Fringe Elements.

She never talked back

WA Examiner: Half of Americans who have left their church no longer believe in God, leading a surge of nearly one quarter of the nation who have no affiliation with any religion, according to a new survey.
Pew Research Center said Wednesday that 49 percent of what they term "nones" left their church and religion because they "don't believe." Another 20 percent said they don't like organized religion. Other reasons included "common sense" and a lack of belief in miracles.
Relationships with invisible people seldom work. 

Wednesday, August 24, 2016

The spectral theory of Social Security stability

The CBO puts out the central tendency of social security trust funds, telling us where the funding stands assuming all other things equal.  We all know it is only a short term projection, it is a line, after all, and the line goes squiggly in the past.

The assumption 'all thing being equal' is the Magic Walrus assumption. It means that all components of the economy have enough liquidity to survive shocks to  the constrained flow.  That liquidity is called spectra in stochastic yheory.

What spectra rules in social security?  The update rate, how often do the overlapping generations meet to make small changes in the in and outs?  In our case, we have an expansion in the 60s, and a correction in the eighties, about 20 years apart.  Nyquist theory tells us that information about the central tendency is best known for yhe 40 year period, one half the sample rate.

Do we collective agents act like Nyquist is true?  Well, yes in many instances.  And the more we act like its true, the more accurate are the CBO projections.

Zero Hedge has a knack for charts

How about vocabulary:

Full Definition of knack

  1. 1a :  a clever trick or stratagemb :  a clever way of doing something
  2. 2:  a special ready capacity that is hard to analyze or teach
  3. 3archaic :  an ingenious device

For example: Government aggregated finance has a knack for cyclic recessions.

Tim Cook?

Investors Business Daily: Scandal: Leaked documents released a few days ago provide juicy insider details of how a fabulously rich businessman has been using his money to influence elections in Europe, underwrite an extremist group, target U.S. citizens who disagreed with him, dictate foreign policy, and try to sway a Supreme Court ruling, among other things. Pretty compelling stuff, right?

No, not yet:

Not if it involves leftist billionaire George Soros. In this case, the mainstream press couldn't care less.
On Saturday, a group called DC Leaks posted more than 2,500 documents going back to 2008 that it pilfered from Soros' Open Society Foundations' servers. Since then, the mainstream media have shown zero interest in this gold mine of information.
We couldn't find a single story on the New York Times, CNN, Washington Post, CBS News or other major news sites that even noted the existence of these leaked documents, let alone reported on what's in them.

That would Hillary 'No Whites Allowed' Clinton's best buddy. 

Using today's technology to produce tomorrow's goods

We’re Working Harder Than Ever, So Why Is Productivity Plummeting?

The article is from time magazine.  It misses an important point, when central banks try to pull future consumption backward to today, then they ate producing tomorrow's goods with yesterday's technology.  It is a coordination failure, technology was not prepared but the central bank forced production anyway; result is lower productivity..

San Francisco voters screw Tennessee

Business Insider: Tennessee's Obamacare market is in serious trouble, according to the person who runs the state's exchanges. Julie Mix McPeak, the Commissioner for Tennessee's Department of Commerce and Insurance, told Nashville's The Tennessean on Tuesday that increases in premium prices and the dwindling number of insurers in the state are causing serious stress in the state's Affordable Care Act exchanges.
 "I would characterize the exchange market in Tennessee as very near collapse... and that all of our efforts are really focused on making sure we have as many writers in the areas as possible, knowing that might be one," said McPeak in an interview with The Tennessean's Holly Fletcher.

San Francisco voters are a fairly ignorant.  Now they have completely fouled up what was left of the medical industry.  California has already committed, the medical industry unions now have democratic control over the legislature, and  they will use Jerry Brown and Obamacare to drain the economy while Texas thrives.  Jerry Brown you are a complete idiot and you knew this was the outcome.  Obamacare is Jerry Brown's second 'Dills Act' moment, a disaster.

Kevin Drum spouts the usual racist horse manure

Mother Jones and fellow racists: I mean, it's obvious what's going on. Trump couldn't care less about black votes. His speeches are aimed like a laser at his white base, using language carefully calculated to assuage their fear of being called racist if they support him. Nobody in their right mind would give the speeches he gave if they were truly trying to address African-Americans. But even though this is obvios....

I highlight the racist comment. Notice that Kevin considers Blacks to be a peculiar breed, a breed that needs special attention. OK, African-Americans, here is your chance. What is the special race characteristic that Kevin Drum is so familiar with?  Is there some deficiency in the Black race that needs tender care from the editors of Mother Jones?

A fact for the day

Bloomberg: China’s total debt is now about two and a half times the size of its economy. It takes almost a third of gross domestic product just to service it. Corporations are by far the biggest debtors, especially state-owned enterprises.

Tuesday, August 23, 2016

Illinois teachers union dictates a tax increase

Reiuters: Potential action this week by Illinois' biggest public pension fund could put a big dent in the state's already fragile finances, Governor Bruce Rauner's administration warned.
A Monday memo from a top Rauner aide said the Teachers' Retirement System (TRS) board could decide at its meeting this week to lower the assumed investment return rate, a move that would automatically boost Illinois' annual pension payment.
"If the (TRS) board were to approve a lower assumed rate of return taxpayers will be automatically and immediately on the hook for potentially hundreds of millions of dollars in higher taxes or reduced services," Michael Mahoney, Rauner's senior advisor for revenue and pensions, wrote to the governor’s chief of staff, Richard Goldberg.
When TRS lowered the investment return rate to 7.5 percent from 8 percent in 2014 the state's pension payment increased by more than $200 million, according to the memo.
Blue states have basically given up on democracy.  For example, an actual professor in our public university, Mark Thoma, is advocating that we eliminate the US Congress,  a requirement needed so the bad math of MIT Basket Weavers match.

The 'Congressional Black caucus(CBC) thinks they found racism

The Hill: The GOP nominee’s efforts at minority outreach have infuriated Democratic members of the Congressional Black Caucus (CBC), who on Tuesday convened a conference call to accuse Trump of perpetuating stereotypes and using coded language meant to get white racists to the polls. 

Cute, they have a name for their racist group. But we have too many racist caucus suckers in Congress.

My hometown in the news

College FixCalifornia State University Fresno recently held a three-day student retreat for black students that aimed to foster inclusion and help incoming African American students adjust to college life and get involved in the campus community.
The inaugural “Harambee Student Retreat,” which took place Aug.14 through Aug 17, was free to participating students, who enjoyed housing, meals, workshops and activities meant to help aid in the “successful transition of incoming African American/Black students to Fresno State,” the university’s website states.

Texans pick a Yawker

Bloomberg: For a generation, being Texan has been as much about a love for the Alamo and barbecue as for picking Republican presidents. Now, with Donald Trump as the party’s nominee, there are signs that the grip on the Lone Star State may be weakening.
Trump arrives in Austin Tuesday for a rally after a poll released last week by left-leaning Public Policy Polling shows him ahead of Democrat Hillary Clinton by 6 percentage points, one of the slimmest margins in recent Texas history. Among voters 45 and under, Clinton is beating Trump by 25 points. A June poll from the University of Texas/Texas Tribune showed Trump leading Clinton by 8 percentage points.
“He’s negatively impacting the future of the Republican Party in Texas,” said Jerry Patterson, a Republican who formerly held the position of Texas Land Commissioner.

Monday, August 22, 2016

Living in a low lying Swamp with ever present noxious gases


Slimed! Gross 'black slime' creeps over Washington DC's most famous monuments - and no one knows how to get rid of it 

It's the swamp gas, it precipitates onto old marble statues.  It also causes long term dementia to political residents of the Swamp.

Saturday, August 20, 2016

Worker segregation

Wage Segregation: In this paper we study how the sorting of workers to firms has changed over time. We do so by using detailed and direct measures of worker’s cognitive and non-cognitive skills linked to firm level data covering the entire Swedish private sector. Our main finding is that there has been a substantial increase in the sorting of workers by skill between 1986 and 2008, with larger skill differences between firms and smaller differences within firms. The main driving force behind the increase in sorting is the expansion of the ICT sector.
The theory is that high productivity workers congregate in their own firms n as they do not like subsidizing the low productivity worker.  It is cheaper to segment workers by firm  rather than within the firm. 

This is a specific effect of quantization in economics.  Fimrs using high productivity workers trade workers with each other, they all have the same employer risk therefore. 

Why is the tennis one armed backhand considered aesthetic form?

I have heard this twice, fans think the tennis backhand a thing of beauty. Roger was famous for backhand tricks, even though he had one of the great forehands,'
Why this curiosity?

There is no natural motion of any east plains ape that required a backhand shoulder motion and the back of our hands cannot hold a throwing object.  We invented he backhand motion when we grabbed a stick, it is a purely human invention.

President Trump, by a whisker

According to the LA Times tracking poll.  He is likely getting the Hispanic law and order vote.

We do not care, Mr Turkish Premier

Bloomberg: U.S. failure to extradite Fethullah Gulen, the Islamic cleric blamed by Turkish authorities for the failed military coup last month, is “destroying” Turkish-American relationships, Prime Minister Binali Yildirim said in a stern rebuke ahead of a visit by Vice President Joe Biden.
“Nothing is the same after July 15,” Yildirim told journalists on Saturday in Istanbul. “America knows this, and we know they know it.” The premier described bilateral relations as “so-so.”

The  Erdodan guy says Turkish policy is to beat women for sex, make lots of uneducated, religious psycho babies, and invade Europe for the welfare checks.  Now does anyone in their right mind think the American people give a crap about Turkish relations.

Higher inflation is code for helicopter drop

The graph is the implicit price deflator, down since the last helicopter drop.  The calls for higher inflation refer to the beginning of the chart, just after the Nixon shock.  They call for  a monetary shock, a late night drunken helicopter flight.