Yuan for the money?

My latest read of the Economist had a particularly disturbing but compelling argument that it is only a matter of time before the Yuan will be the Worlds reserve currency. The article describes it as an overdue change, although I get the impression that it is not desirable, but inevitable and the alternatives eventually being virtually disastrous. I don't like it, but I realize now that it will probably happen, maybe before 2020. My preference is of course the Aussie dollar, but the chances are quite remote.

Ok. I admit it . the Economist is privatisation biased

Having read the Economist Intelligence Unit's brief accessible summary on broadband plans compared among dozens of countries, it has become obvious to me. Australia's broadband plans have been scored low because of the high comparative cost and mediocre quoted speed.

The issue I have (as I had with their take on university privatisation) is how the length of term of investment is never even considered as an issue. Wireless (Next G as oposed to Wi-Fi) has excellent returns on investment in the short term, but is in no way future-proof.

The real crux of the issue - Who should pay for and/or own infrastructure as opposed to running costs and retail sale of bandwidth etc, is never mentioned. It wouldn't be an issue to me, if the alternative suggestion was the government owning and spending money on a much reduced infrastructure - That would be a reasonable alternative, but in the long run, it wouldn't actually be cheaper. To me it is like Mr Windsor said - "You do it once, and you do it with fibre".

The biggest returns will happen once Moore's law catches up with the capacity of the network. Memory capacity still doubles every 18 months, but data generation and traffic on the internet is doubling quicker than that, about every 12 months. Therefore, given that if you build it, the traffic will eventually fill it - it makes sense to optimise the cost of the end-point infrastructure, rather than requiring a shorter timeframe to gain a payoff with something that will need to be upgraded again, duplicating a lot of the initial work.

Democracy - a counterexample

Back a few entries where I was discussing democracy, the general assumption is that many people who are able to independently check policy before voting on it will more likely get the right decision than a particular individual or expert could.

The corollary is that the more democracy and the more direct the democracy, the better general decisions will be made.

A counter-example to this corollary is immigration and trade policy. Democracies have a notorious habit of restricting immigration and trade when the economy deteriorates. Even though the concept is that as citizens, we have the right to make bad choices, and pay for them, democracies continue to make the wrong call due to the primacy of perception over facts in the political game. The causal relationship between restricting trade/immigration and a worsening economy is ignored over a very strong human instict to blame externalities over any systemic internal cause.

Thus people continue to promote fallacies such as "reducing immigration helps our unemployment rate" and "restricting imports helps our unemployment rate".

Maybe I am wrong. Maybe democratic countries will leave tariffs and immigration quotas untouched, while autocratic countries will clamp down on trade/immigration during the current downturn. I would be surprised.

Good date choice

I'm now glad I used September 26th as a future-prediction date as this Buttonwood Economist article has used the exact same date (for 2021) as a criticism of governments' willingness to ban short-selling to staunch losses due to share-markets falling.

Economist.comments.marcoparigi

Still doing more Comments on Economist.com than my usual blog sphere of reading.

Subjects of interest include:

China
Iraq
green taxes
superannuation
oil
carbon footprint
Australian immigration/guest workers

Does this link work

Does this link to Economist articles with comments! work? It feels like sending a letter to the editor and always being published!

In defence of usury

This economist article finds that a "consequentialist" analysis of the results of lending money at extortionate interest rates to the poor is better for the would be borrower than being refused the loan. An "Absolutist" would not believe such a one-off study to be relevant and defer to the scriptures, which probably state one way or another that usury is evil in general and should not be allowed. I for one, have come to the conclusion that usury IS evil, but possibly a necessary one for modern civilisation to keep prospering.

Top end of the "Marriage Gap"

Reading this Economist Article:marriage in America, I feel vindicated, because almost all of the pressure and "education" that I received from others was directed to me about the risks. That divorce is bad, and that the divorce rate is high is self-evident. Clearly, the trick is not to avoid marriage, but to get it right when you do marry or otherwise commit to a life partner. I think the most important thing to instil in ones peers and children is to look at precedent. Ie. does the person come from a broken home? What history do they have with committment? etc. I have been trying (with variable success) with my daughter that these are important questions right from the first time you decide to date someone. Unfortunately, she is getting mixed messages from tv shows and peers.

Education - Nationalise or privatise?

My simple rule of thumb is: that for the longer the term of the investment (before being profitable), the further it should be towards nationalisation on the continuum. Pre-school children are basically a very long term investment before what they have learnt makes an impact on society. University students, however, in a few short years, can go from being smart to being an asset to an employer, society or whatever. Therefore, the efficiency of competitive private finance is critical for universities, but almost meaningless for kindergarten. This is why I think "The Economist" is correct when it states that governments should deregulate and privatise higher education.

Privatisation/Nationalisation Axioms

* - Continuous Spectrum. For any "Stuff" there is a continuum of policy of ownership from Government-owned monopoly all the way to unregulated competitive private ownership. Some markers being Highly regulated private monopoly, Government owned but some private subcontracting, majority owned near-monopoly competing with private enterprises, Government services competing in a fairly level field with private. Conveniently economists can come to a consensensus on where on the spectrum a policy puts itself.

* - Independent nation-states able to individually pursue and experiment with policies without being able to impose such policy on other countries or be imposed on from the UN or other supranational entity.

* - The judgement on policy is essentially which country does well in a typical competitive environment in the ideal where the policy concerned is the only point of difference.

* - There is little or no interdependence between different "stuff" being privatised. ie. if A is privatised, and B is privatised, the net effect will be approximately the sum of the effects of each.

* - Price controls on "Stuff" which is nominally privatised has the effect of removing a large chunk of control from private interests and should be considered in the nationalisation end of the spectrum.

Dissecting articles from Realclimate.org

WSJ Editorial Board: Head Still Buried in the Sand
Filed under: Climate Science RC Forum— group @ 8:38 am
While the rest of the world has basically accepted the conclusion of the latest IPCC report, one small village still holds out against the tide - the Wall Street Journal editorial board. This contrasts sharply with the news section of the paper which is actually pretty good. They had a front-page piece on business responses to global warming issues which not only pointed out that business was taking an interest in carbon reduction, but the article more or less took as a given that the problem was real. However, as we have pointed out before, the editorial pages operate in a universe all their own.

I will start with their latest headline piece - It is very typical anyhow. As far as the title goes, using a metaphor is a form of "proof by ridicule". What exactly they are trying to prove is not obvious to start with, but the means they are using is attacking an opinion piece. To falsify a scientific statement you must use science, to falsify an opinion you must use ridicule. Fairly obvious, but they are not really showing their hand.

The first sentence uses the terms "village" and "Tide". I am not sure if this is subliminally pushing the "sea is rising" fear triggers, but is the tide public opinion? Public opinion of what? The tide is of pro-environmentalism and the village is of dissenting opinions published in news & magazines. Almost all magazines (including "the Economist") have stopped publishing dissenting views (whether they be scientists or whatever). I am not really sure why that is, but for instance, the Economist has not recently written anything at all from Bjorn Lomborg, while a couple of years ago, they backed him up in almost everything he said.

The third sentence mentions business responses and interest, and the taking as a given that the PROBLEM is REAL (by the front page article). The science demonstrates beyond reasonable doubt that there is global warming and that humans are the predominant factor. That it is a "problem" is a much less scientifically tested assertion. Proving that there is global warming and that it is caused by humans does not prove that there is a problem in itself. Also, there is the assertion that it is the most significant environmental problem. This assumes a prioritised list, but prioritised lists have been rejected as presumptious.

The fourth sentence is again criticising the opinion piece, and again ridiculing it. I have found this type of tactic in operation with groups of evangelical christians. It was exceedingly effective when used in groups of majority christians and a minority of uncommitted youths. They would ridicule (say) evolution, and attack the inconsistencies of darwinism and any proven errors any Darwinist has ever made. It is difficult for an uncommitted person to resist this kind of peer pressure. I think this is what is happening in Realclimate. There are a majority of readers which are "converted" and a minority of uncommitted and recalcitrant, which is a perfect environment for winning over the uncommitted.

The sentient beings of Proxima Centauri are laughing at us

In their Hydrogen powered 'lighter than air' aircraft while we here start to worry about
Aircraft Emmissions of the CO2 sort. We are constantly thinking of ways to use Hydrogen on the ground, but still have the taboo against Hydrogen power+levitation of the air. This is singularly attributable to the Hindenberg. Similarly, Hydro power is also taboo at least for green groups that spent decades fighting against them. What green group would suddenly turn araound and say, gee.. if we consider the carbon credits, maybe Gordon-Franklin wasn't such a bad idea! If the first hydrogen powered bus crashed and burst into flames, would we never consider hydrogen power for road vehicles again?

"Darwinism" as a staircase

The front cover of the economist christmas edition shows the classical subliminal message that human evolution is about progress up the ladder (staircase in this case). Although the actual article does rail against the popular concept of "survival of the fittest" because it completely mis-states the reality; it does mention such things as "progress", "great leap forward" as scientific concepts of what was happening at various stages. Genetic palaentology has been able to put accurate dates on common ancestry, which is really illuminating. Great science is happening, but darwinism as a popular ideology doesn't require it. To remain popular, Darwinism must still place humans on a pedestal above other living things. This is to replace the "specialness" that is given to humans in various religions. Because, in general, Darwinists profess to be non-religious, why should they care what happens to the human race if we are not special or superior to animals?