JP Morgan debacle - it's all Krugman's fault

Felix Salmon pins the JP Morgan debacle on the CEO - Jamie Dimon.

Dimon supported Ina Drew's transformation of corporate "checking accounts" into big bets against Europe and the Euro. They turned a risk management fund into a trading operation. It's 2009 all over again.

Dimon's luck with his timing though. The GOP Congress will ensure there are no consequences this election year, and he can put his billions towards a Romney win.

Even better, Dimon can pin the whole thing on the guy traders hate - Paul Krugman. After all, it was Krugman who predicted that Greece would have to drop out of the Euro unless Germany accepted major reforms. 

As it happened Europe made partial reforms, pushing the date of Euro collapse into 2012 and ruining Dimon's week.

Of course Krugman has not really been disproved, but doesn't he make a great scapegoat for Dimon?

In the end, Krugman humbled JP Morgan after all. Just not the way we thought he would.

Facebook and financing a new Vikings stadium: it's a messy world

My Facebook stream has been telling me what my friends read and the movies they watch. 

So far, nothing too surprising.  I'm tempted to click on some of them.

Some of them are click-safe. Others are wee traps. By clicking on them I'm authorizing the apps to share some of the things I read or watch. Robert Wright at The Atlantic has the details.

Take a friend's whale video for example. His post doesn't look like an "app post". There's no "hide this app" option for it. Alas, those cues are so 2011. Apps are more covert now. When I click on the link I get this this dialog from "Chill.com"

Note the blue button doesn't say "run this app". It says "Okay, Watch Video". 

If I did click it however ...

• Everything I watch from Chill going forward would be Public on my timeline. (I periodically run the FB app that sets all my posts to friends-only; that's what I want. FB has ways to work around that.)
• Chill would get my private email address and my profile info
• Chill will post all videos I watch, all that I react to, "and more" -- on all my friends feeds. From their privacy policy "When you use our Service, all of the information that you submit, which may include name, email address, photographs and comments, will be publicly available to third parties and we may not have control over what they do with it. By using our Service, you consent to such disclosure. "

Chill isn't breaking any rules. It's "How Apps Work Now" - frictionless "Social Running".

Facebook, like Google+, is incorrigible. There will be a bit of an upset about this, but not as much as with their last 50 violations.

So why do I stick with Facebook when most of my geek friends have left it?

Because it's still where the non-geeks are. The kids on my son's baseball team don't all have email (or don't use it). They don't all have mobile phones with text plans (and besides, mass texting is a pain). They do all, however, use Facebook. So to communicate them I put up a Facebook Page for the team. Same thing with our inline skating club and our special hockey team.

I put Facebook in the same bucket as the state gambling operations we're using to fund a new football stadium for the Minnesota Vikings (just in time for the twilight of American football). State lotteries and the like are a tax on people who are bad at math -- or who just need a bit of hope. We'd never get stadium funding by taxing income or real estate, but voters are willing to tax the poor. Facebook is just another annoying part of the imperfect world we make the best of.

The Wart Blog

This is my 7420th published post since July 16, 2003.

Of all 7,420, the comments and hits on one whimsical post about duct tape treatment for warts far exceed all other comments put together.

That post is my legacy.

Oldest web news portal - refreshed

For about 340 web years (@ 17 human) Emily and I have used the same web news portal. It's a basic HTML 2.x table based layout link page. The links change very slowly - the BBC World link may be original. It may be older than the Yahoo news page.

I did the first version in a text editor, perhaps BBEdit. Then FrontPage 95, 98, 2000, 2002 ... and back to FrontPage 98. FrontPage 98 lives in an old XP VM on my iMac; I start it up every few months to update the page (my old web site is archived). There's still nothing like FrontPage that will run on a Mac, so perhaps I'll go back to BBEdit next.

I've updated the page again - Yahoo and Salon broke some links and I finally replaced my defunct iframe embedded Google Reader Shared Posts. Instead of the GR Shares there's a somewhat awkward embedded Pinboard Mobile page (my microblog/GR Share replacement).

Feel free to bookmark it if you're looking for a simple news links page -- the URL hasn't changed in over 250 web years. It will probably last as long as me.

Understanding the Middle East: Iran's 16th century Safavid Dynasty (IOT)

Around the time Spain and Portugal were swarming over the Americas and the European Renaissance was firing up, a semi-divine Sufi Ruler [2] created modern Shiism and reshaped Iran and its neighbors.

This was the time of the Safavid Dynasty (and empire).

I had no idea - until I listened to this excellent In Our Time podcast [1]:

BBC - BBC Radio 4 Programmes - In Our Time, The Safavid Dynasty 

... In 1501 Shah Ismail, a boy of fifteen, declared himself ruler of Azerbaijan. Within a year he had expanded his territory to include most of Persia, and founded a ruling dynasty which was to last for more than two hundred years. At the peak of their success the Safavids ruled over a vast territory which included all of modern-day Iran. They converted their subjects to Shi'a Islam, and so created the religious identity of modern Iran - although they were also often ruthless in their suppression of Sunni practices. They thrived on international trade, and their capital Isfahan, rebuilt by the visionary Shah Abbas, became one of the most magnificent cities in the world. Under Safavid rule Persia became a cultural centre, producing many great artists and thinkers...

The role of Armenian Christians in the dynasty puts the infamous Turkish genocide in a historical perspective. The Ottamans and Safavids were great rivals, and the Christian Armenians seem forever caught in the crossfire.

This history, and the myths that arose from it, explain a lot about modern Iran and the great Shia-Sunni struggles of the 21st century.

[1] This link is to the almost impossible to find archived podcast. Despite the BBC's stated podcast policy these are no longer discoverable from the primary In Our Time episode archives. You can find them on on the hidden BBC IOT Podcast archive. You may be able to also extract them from the iTunes archive or the BCC IOT Podcast feed. I blame it on Cameron.
[2] The last of the Iranian Shahs, prior to the latest revolution, was accused of favoring Zoroastrian ideas, including divine rule. The God-King is a worldwide tradition. (Aside, I met one on his sons when I was at Williams College in @ 1979/80.)

Sympathy for the federal reserve: Bubble 2.0

In the 90s we excoriated Greenspan for presiding over the dot-com bubble. Why didn't he include bubble management in price stabilization?

We never did recover from the crash of '99; but our real estate bubble made us feel better for a while. Then, of course, came the Lesser Depression.

Now, in the 10s, Krugman beats up on Bernanke for allowing systemic depression to persist and for failing to apply the counter-intuitive hydraulics of Keynes. My other economists stake out varying positions on the structural vs. systemic unemployment spectrum -- with most seeing a mixture of both with systemic causes persisting and structural causes, including technological, growing [1]. My team, generally speaking, favors both fiscal and monetary stimulus until we return to around 6% unemployment and "normal" economic growth. At that point Keynes says it's time to dial the inflow down (alas, that doesn't seem to happen very much. See dot-com bubble, above.)

The GOP, and especially GOP voters, mean that fiscal stimulus such as infrastructure development or government employment isn't a viable option. That leaves macroeconomic policy. Since low interest rates have run up against the famous zero bound, that leaves options like inflation targets.

But what should Bernstein do when, in the midst of the lowest labor force participation since 1984 (amongst white males the lowest since 1939) we see Bubble 2.0?

Mr. Bernstein has my sympathy.

[1] Sadly for my ego, nobody seems interested in whitewater/discontinuity disequilibria theories.

Where did Apple's Aperture 1.0 come from?

I've editing a summary post on my challenging iPhoto to Aperture migration. That's made me wonder, again, where Aperture 1.0 came from.

Aperture still doesn't use the native OS X tools for file browsing. It is the most un-Mac like product I've ever used.

The image framework was originally based on OS X Core Image, which was, I assume, a descendant of the NeXT imaging engine. So did Aperture start out as a NeXT photo management tool?

Unfortunately I can't find anything on the net about NeXT photo management software -- perhaps because NeXT died when the web was young, and also because "NeXT" is a useless search term (modern search engines are not case-sensitive).

Perhaps Aperture 1.0 was an acquisition, but I don't see any likely suspects on Wikipedia's Apple mergers and acquisitions list. Perhaps it was designed to be sold on Windows as well as Mac OS; but then why not emulate iTunes?

It's a puzzle. If I had to bet, I suspect it has roots in NeXT. I don't think it's de novo OS X development.

How to buy happiness

If you're a reasonably healthy middle-class American adult you too can buy happiness. Here's how ...

Coding Horror: Buying Happiness 

1. Buy experiences instead of things
2. Help others instead of yourself
3. Buy many small pleasures instead of few big ones
4. Buy less insurance
5. Pay now and consume later
6. Think about what you're not thinking about
7. Beware of comparison shopping
8. Follow the herd instead of your head 

Number two was probably the hardest one for me -- pre-kids. Now 'helping others' is most of what I do. Obviously, there are other ways to do that.

The list and explanations fit my own experience. It's the best guide I've seen.

My personal salon - the feeds I read completely

RSS is history. We know that. It's been replaced by ... by .... 

Right. Whatever is going to replace Feeds (RSS/Atom) hasn't quite arrived. So, while we wait, we read. In my case, I read using Reeder.app on my iPhone, Reeder for Mac on my main machine, and Google Reader elsewhere.

Recently, I did a reorg and cleanup of my subscriptions. I deleted perhaps 30 -- some hadn't been updated since 2006. A few were quite good, but ended abruptly a few years ago. Perhaps the author will return, maybe something happened to them. Google abandoned many blogs when they went G+, I deleted most of them. They're not very interesting any more anyway.

I was left with 363. I've long organized them by source and topic, such as "NYT" or "Science". This works pretty well, but there's a subset of blogs that are special. These blogs may not publish very often, but I read almost every article. They deserved more attention.

I've put these into a folder I call "Core", and I've shared them in a Google Reader Bundle called "Core" [1]. You can subscribe to them through the "bundle" (assuming it still works) and delete the ones you don't want. Or you can google the names on this list (I left out Gordon's Notes and Gordon's Tech because I'm just that kind of guy): 

All That's Interesting - pictures mostly
Blood & Treasure - China from a UK view
Charlie Stross - thinker and writer
Coates - intellectual.  Aka TNC, Ta-Nehisi Coates.
Coding Horror - geek and thinker
Cosmic Variance - physics
Daring Fireball - often annoying, almost always interesting. Mac
DeLong - an old favorite, though we read too much of the same stuff.
Ezra Klein - politics
Fallows - aviation, the world
Follow Me Here... - psychiatrist. A lot like me.
Gail Collins - NYT
Gwynne Dyer (NZH) - rabble rouser. Almost always right.
Hawks on Anthropology - like it says
I, Cringely - sometimes a bit eccentric. I worry about him. Almost always very interesting
Joel on Software
Leonard - economics
MN Bike Navig - local fave
Oatmeal - web comic
Paul Krugman - you know
Pphysics arXiv - best short science
Roger Ebert - intellectual, scholar, humanist
Salmon - business, news, journalist, economics
Shtetl-Optimized - computational physics
Talking Points - cutting edge politics
The Economist: Obituary - almost the only good part of a long dead journal
The Economist: SciTech - the other good part of a long dead journal
The Wirecutter - tech products, only the best
Top 25 - NYT Top 25
Whatever - Scalzi - science fiction
xkcd.com - unbelievably good

They mostly don't know me, but they are my salon. I'm a quiet sort of host. One or two are MN centric. I have Emily's Calendar feed in 'Core' too so I know when she adds events, but obviously there's no need to share that.

Many of my Pinboard/Twitter/Archive shares come from this set.

[1] Yes, Bundles still exist. Surprisingly. The view resermbles the old Reader Share view. There is some bugginess though; the widget for viewing the feed list is broken. I wonder if Google has forgotten this exists.

IPO lessons from MySpace

My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!
Shelley

Cleaning spam out of my Yahoo email (it's spam-only), I saw mention of MySpace.

It jogged an old memory. I'd set up an account there in 2006 - mostly to secure a username in case it went anywhere. I still had the old password in my Filemaker web database (it goes back to 1995 or so).

Here's the first entry in my MySpace messages ...

Welcome to MySpace, the best place to connect with friends on the Net! 

I'm Tom, and I'm here to help you with MySpace. If you have any questions, comments, or just want to say Hi, feel free to send me a message! You can also check the FAQ for the most frequently asked questions. 

How do you get started? 

On MySpace you share your profile, photos, blogs, and messages with a fast-growing network of people connected to you by your friends. 

The first thing to do is to invite your friends -- then when they invite their friends you'll all be connected!

There are several hundred subsequent emails, all spam and terms of service announcements as best I can tell. Most of the site UI is advertisements.

Facebook is supposed to go public soon -- in the midst of Bubble 2.0. Investors should remember MySpace.

Progress

Progress is a drunken walk.

Why did productivity gains go to the elite after 1973?

After 1973, and especially after the early 1980s, productivity gains went towards the 1%. Media male compensation in particular went flatline... (emphases mine)

Where The Productivity Went - Krugman

Larry Mishel has a systematic breakdown of the reasons for worker income stagnation since 1973. He starts with the familiar divergence: productivity up 80 percent, the compensation (including benefits) of the median worker up only 11 percent. Where did the productivity go?

The answer is, it’s two-thirds the inequality, stupid. One third of the difference is due to a technical issue involving price indexes. The rest, however, reflects a shift of income from labor to capital and, within that, a shift of labor income to the top and away from the middle.

... Income stagnation does not reflect overall economic stagnation; the incomes of typical workers would be 30 or 40 percent higher than they are if inequality hadn’t soared.

Happily, Krugman doesn't say whether this is "fair" or "just". Those are meaningless words. Obviously one man's fair is another's unfair. No laws need be broken, though many may be bent. Purchasing politicians may speed the inequality process, but even that is probably not essential.

The interesting questions are

1. Why did this happen in the late 1970s? What changed? How much of this is a result of computerization, automation, and globalization?
2. Is this good?
3. Is this wise?
4. Should we do anything about it? If so, what should we do?

My answers are

1. It is technology and globalization, and large corporations changing the ecology of accounting and regulation to perpetuate themselves.
2. It is not good.
3. It is not wise. This is a recipe for social collapse.
4. We should do something. We should tax carbon. We should tax financial transactions. We should institute industrial policies that provide employment to the bottom 60%. We should expect to subsidize employment for the mass disabled of the information age. We should prepare for the AI age.

Your answers may vary.

See also:

• Slavery, technology, and the future of the weak 2/2012
• Life in the post-AI world. What's next? 9/2011
• The AI Age: Siri and Me 11/2011 (Shortly after I wrote this Siri stopped being useful. Coincidence :-)?)
• Mass disability goes mainstream: disequilibria and RCIIT 11/2011
• Attacking Inequality: Redistributing wealth 9/2006
• Opposition to redistribution - two causes 9/2011 - why income subsidies must be invisible
• Occupy Wall Street (OWS): the mass mind masticates 10/2011
• Where has the money gone? To the very American oligarchy. 2/2006
• The Quiet Coup - Atlantic Mobile 5/2009 - Simon Johnson. How America's de facto oligarchs came to emulate Russia's. I missed this one three years ago; it's a classic that deserves a post of its own.
• My Favorite Paul Krugman Essay: Brad DeLong (DeLong on Krugman 1998)

Why are Google and Facebook ads so crappy?

In our world billions of dollars are spent trying to get us to read and click ads.

Billions.

So why are the ads so crappy? Google, which knows more about me than my mother, offered me these two next to my Gmail:

Master of Science Nursing
Earn a CCNE Accredited Masters in Nursing Online - Norwich University...

Overstock iPads 2: $43.20
Today Only: Get 32GB iPads for $43. 1 Per Customer. Limited Quantities...

A probably fake diploma program (or it's Norwich in the UK?!) and a con. Either Google thinks I'm an easy mark (demented already?), or it doesn't really know me after all.

Facebook is no better.

Really, spammers do better. After all, I'm marginally more likely to pay for genital enhancement than to send money to a con man. (I can imagine, for example, developing a brain tumor that might radically change my personality.)

It's not that I'm opposed to viewing ads. I pay $20 a year so that, in part, I can read the ads in Silent Sports.

Let me repeat that one. I actually turn over cold cash to read ads. I'm not the only one. Once upon I would, on occasion, buy a giant monthly phonebook sized slab of newsprint called "Computer Shopper" so I could read the friggin' ads.

I don't read or click Google or Facebook ads. Not because of an ideological objection -- but because they're worthless.

So where are all those billions going? Why doesn't Google or Facebook ask me what ads I'd like to see?

Why am I the only person who seems to notice this? Is it really just me?

There's something very strange going on here.

Microblogging 2012 - Pinboard?

Once every few days to weeks I write a short essay, from a few paragraphs to a few "pages" (remember the page?).  Every few minutes to hours I share a link and a comment from a few words to a pair of paragraphs.

Both forms of writing almost always involve links; they point to a linkable entity.

I have to call the first blogging and the second microblogging because I can't escape the b-word (is there a language in which the name is less painful?).

Whatever the format, I do the writing for same reasons. It's primarily a way for me to learn, think, and remember. I do it publicly because I have the hive-mind communicator gene-set. I want to share the ideas and things that I like.

I want to share -- but sharing has a very important side-effect. Sharing enables indexing.

My extended memory relies on Google Custom Search (oh Google, why has thou forsaken me? I forget too much without you.) Everything I share has an entry in a Custom Search Engine I use several times a day, though recently the embedded ads have become oppressive.

I do the blogging using Google Blogger. I wanted to move to WordPress, but I decided the quality and security issues of an independent WordPress site were too severe for me; I don't have the time. I'm now evaluating a paid account on WordPress.com.

The micro-blogging is a bigger problem. I used to use Google Reader Share - one of the lesser known but most beloved products of the days when Google was Anakin. Reader Share died when Google became you-know-what.

Twitter is too constraining and I don't trust Tumblr. After trying several options I settled on Pinboard because of its business model (I pay), sharing/export options, RSS support and, especially, Reeder.app and Instapaper integration. I use IFTTT to republish my Pinboard 's' stream to my Twitter stream, and I'm now experimenting with using IFTTT to repost them to an archival and indexable WordPress or Blogger repository.

The indexable bit is a Pinboard problem. Pinboard's developer does not love microblogging; he wants to have a bookmarking service. Pinboard posts are NOINDEX by design.

Pinboard has other microblogging limitations. I use tags to create routable streams of shared information. Almost all are part of my primary share stream, but some are special sub-streams for my colleagues or for my own reference and actions. Because of the way Reeder.app works many of these are single character tags. This isn't how Pinboard is supposed to work; tags are supposed to be global - not personal. I can't, for example, show only my own tags in the Pinboard UI.

Lastly Pinboard isn't as reliable as Reader Share was - though almost nothing is. Sometimes, when I post, Reeder.app hangs waiting for Pinboard to respond. (The hanging behavior is a Reeder.app design flaw).

I'd be delighted if Maciej Ceglowsk's Pinboard.in were more of a microblogging platform. I wish I could see only my own tags for example. Above all, I wish Pinboard included an option to use the Atom publishing protocol to create an indexable and persistent post on a blog. I'd double the amount I pay Maciej for that feature.

I don't hold out too much hope. Pinboard is known to geeks, but it's not a big revenue stream. In a crazy world where a small photo sharing site can be worth a billion dollars, Pinboard is almost an anachronism...

... I wrote Pinboard in the spring of 2009 as a personal project, partly out of frustration with a redesign of Delicious that I felt removed a lot of utility from the site, and partly because I had long wanted to have a bookmarking site that would archive my bookmarks...
... The service has stored about 45 million bookmarks as of January 2012, and has just over 20 thousand active users....

... Pinboard is written in PHP and Perl. The site uses MySQL for data storage, Sphinx for search, and Amazon S3 to store backups....

As a bookmarking service Pinboard is a labor of love. It probably wouldn't do better even if it were extended to be the front end to a standards-based microblogging service - but I hope Maciej will consider the option. There might be some money from current subscribers, and perhaps referral fees if Maciej recommends an optional WordPress service (ex: Dreamhost, WordPress.com).

Someday we'll get back to the original Google Reader Shares vision. It might take a while though. After Palm died we were lost in the desert for a decade before we returned to a handheld calendar, tasks, contacts and notes solution. I hope this trip will be a bit shorter.

Update 4/30/12: Maciej is exploring how Pinboard might be a better microblogging profile, and whether it would work to enable Pinboard indexing. In the meanwhile I've turned off IFTTT posting to Blogger and disabled indexing of that test blog. I'll go forward with archiving my Pinboard posts to WordPress - http://www.kateva.org/sh/.

Information asymmetry and my Cuisinart coffee maker - Steve Jobs in Hell

Our 15 yo coffee maker finally died. We bought Cuisinart's 2012 equivalent.

It sort of works, much as our current toaster sort of works. Like most of the consumer products we buy, it's firmly trapped in the local quality minima of the Akerlof information asymmetric quality trap. The Cuisinart name, like SONY, is just another meaningless brand, another Apple antithesis.

There are manufacturers who've escaped the quality trap; brands like BMW, Mercedes, Apple, and Shimano. It's remarkable how few succeed, however.

The Cuisinart has  a signature feature that perfectly represents the quality trap. It signals when the water chamber is empty. This isn't an essential feature, but it's not necessarily worthless. A soft pulsing light would be fine, or a gentle chime. Alas, the signal is four piercing beeps that would be awful in an alarm clock. The cheapest possible signal.

If there were a Hell, and if Steve Jobs were in it, this would be his coffee maker.