Sunday, January 15, 2017

OANN — China should stop intervening in FX market and let yuan float: researcher

China should stop intervening in the foreign exchange market, devalue the yuan and let it float freely to restore stability, a senior researcher at a government-backed think tank said.
Xiao Lisheng, a finance expert with the Chinese Academy of Social Sciences, made the remarks in an article on Monday in the official China Securities Journal amid a growing debate among the country’s economists on whether authorities should let the closely-managed currency trade more freely.
The yuan lost 6.6 percent against the dollar last year, the biggest annual loss since 1994.
“The more the government delays the release of depreciation pressure, the greater the impact and destructive power of the release of depreciation pressure will be,” Xiao wrote.
The authorities should “let the yuan exchange rate have a one-off adjustment to realize a free float” of the currency, he said.…
Cut it loose.
Reporting by Winni Zhou and John Ruwitch; Editing by Kim Coghill

"I'm a Defeated Man. I Wanted to Illuminate the Whole Earth!" - Tesla's Last Interview Before His Death — John Smith interviews Nikola Tesla

Tesla was subtle conscious. He describes his experience in this interview. He recounts that this was by birth for him.

Organic & Healthy
"I'm a Defeated Man. I Wanted to Illuminate the Whole Earth!" - Tesla's Last Interview Before His Death
John Smith interviews Nikola Tesla
Crossposted at Counter Current News

Reuters — Trump vows 'insurance for everybody' in replacing Obamacare

Another good start. Think big.

Trump vows 'insurance for everybody' in replacing Obamacare

Matthew Harrington — Survey: People’s Trust Has Declined in Business, Media, Government, and NGOs

Despite broad distrust of business, there are high expectations for business to do more — a potential opening to turn the tide of public opinion. Three-quarters of people agreed that “a company can take specific actions that both increase profits and improve the economic and social conditions in the community where it operates.” According to our respondents, the best ways business can build trust in a better future are to pay fair wages, offer better benefits, and create more jobs. The fastest ways businesses can erode trust are to bribe government officials, pay outsize compensation to senior management, and avoid taxes.…
The recent collapse of trust in government and media should serve as a powerful lesson to business of what can happen when institutions become disconnected from the interests and opinions of the people they serve. Executives have been warned — their customers and the population at large will be watching closely....
Harvard Business Review
Survey: People’s Trust Has Declined in Business, Media, Government, and NGOs
Matthew Harrington | global chief operating officer of Edelman, a global communications marketing firm

Reuters — Trump says wants nuclear arsenals cut 'very substantially'

Starting out on the right foot. This alone would be a major achievement.

Trump says wants nuclear arsenals cut 'very substantially'

Doina Chiacu — CIA director warns Trump to watch what he says, be careful on Russia

Talk about stepping out of line. Or did President Obama give him the go ahead to take a parting shot at the incoming president?

Waiting for the tweet(s).

The US intelligence services are in need of a purge of politicized officials and agents.

Scott Ritter — Exposing The Man Behind The Curtain

Fact-free intelligence. Inference without evidence.

The Huffington Post
Exposing The Man Behind The Curtain
Scott Ritter, intelligence officer in the U.S. Marines from 1984-1995, specializing in arms control and disarmament in both the former Soviet Union and Iraq

The Art of Pricing

Some discussion about obtaining price discounting thru placing large orders rather than 'onesey-twosey' retail type orders.

Wholesaling is when a boutique or another reseller approaches you to purchase your items in bulk, usually expecting a discount for the large order. 
The expected discounts are between 30% and 60%, most often settling around 50%. These discounts are large,

Can this type of discounting result be expected in government purchases of healthcare?   Perhaps this is what Trump has in mind.

If he can achieve what is often 50% reduction in price paid through a similar process, then he may be able to operate within the targets in the current budgetary resolutions passed by the "out of money!" morons and still expand government individual subsidies.

Etsy Sellers Handbook
The Art of Pricing: Preparing for Wholesaling

Zero Hedge — Questions Emerge Why Trump Security Advisor Spoke Repeatedly With Russian Ambassador

The Washington Post reports that two people familiar with the issue, who spoke on condition of anonymity, claim that President-elect Trump's choice for national security adviser, Michael Flynn, held multiple phone conversations with Russia's ambassador to Washington on the day the US announced retaliation for Moscow's interference in the election.

The phone calls were first reported by Washington Post columnist David Ignatius.
As Reuters reports, the conversations appear to raise further questions about contacts between Trump's advisers and Russian officials….
The deeper question raised is who obtained and leaked this information to frontman David Ignatius, apparently illegally, and published in the Washington Post. 

Anyone see a pattern unfolding at the Post? That was snark. How could anyone miss it?

Zero Hedge
Tyler Durden

Zero Hedge — Confirmed: "Unknown" Republican, Democrat Paid For Anti-Trump Report

Having learned previously both the identity of the former British intelligence officer who compiled the "Trump dossier", revealed by the WSJ earlier this week as former MI-6 staffer Christopher Steele, currently director of London-based Orbis Business Intelligence, and that John McCain was the person who delivered the report to the FBI, one question remained: who commissioned the original report meant to uncover a material,i.e., campaign-ending, weakness in Donald Trump's past.

We now have an answer, or least a partial one....
Zero Hedge
Confirmed: "Unknown" Republican, Democrat Paid For Anti-Trump Report
Tyler Durden

Xinhua — Xi's world vision: a community of common destiny, a shared home for humanity

The chief value for Western liberalism is personal freedom. The chief value for traditional Chinese culture is harmony. 

President Xi is positioning China to reassert its traditional role as the Middle Kingdom, which can also be rendered as Central Realm or even Center of the World based on harmony among all peoples.

Economically, this pits the market state, in which distribution is based on competition among wants, against the welfare state, in which distribution is based on a constellation of needs.

This is often or usually characterized in the West as the distinction between a free market economy and a command economy, but it is actually different approaches to a managed economy, since government necessarily plays key roles in each. There are many such approaches possible and some of them have already been tried.

The looks like it may be the beginning of a new stage in the historical dialectic as China and other non-Western countries become developed countries capable of competing with the West not only economically and militarily but also in the conflict of ideas that drives the historical dialectic from the Hegelian point of view.

In in the view, different ideas clash in the conflict of ideas and some have their moment as dominant before being replaced by a fresh idea in the succeeding moment. However, the idea that is replaced is also subsumed and continues to influence historically. 

A previously subsumed idea may also reemerge subsequently in a fresh form to do battle in the conflict of ideas that drives history. Chinese traditionalism is reemerging in a fresh form to confront the dominant liberalism of West on the world stage. 

They will both be subsumed in another moment in the series of moments that constitutes the temporal unfolding of the historical dialectic. What that might look like then we can only guess at now.
Xi's world vision: a community of common destiny, a shared home for humanity

Trump counters Lewis attack via material terms

You can see how the focus of Trump is on material systems in his counter; this in response to Lewis attack on non-material terms:

A lot of what we are going to see going forward is going to be your typical misunderstandings between the material people coming in vs. the non-material people going out.

In general, if you want good material system outcomes you should get material oriented people to run them... to the extent you don't do this then you get shitty material systems outcomes.

Saturday, January 14, 2017

Paul Robinson — The Russian soul and the toxic West

Fyodor Dostoevsky and Vladimir Putin.

It's ironic how the West criticized Communist Russia as being atheistic, and now that Russians have returned to religion and are criticizing the liberal secular West as godless, the West is criticizing Russia for being nationalistic.

The Russian soul and the toxic West
Paul Robinson | Professor, Graduate School of Public and International Affairs at the University of Ottawa

The Economist —To be relevant, economists need to take politics into account

Like I have been saying.

Some people are now waking up to this. The Economist article is typically lame though — a day late and a dollar short. At least they are acknowledging the relevance of politics to economics.

The Economist
To be relevant, economists need to take politics into account
ht/ Lambert Strether at Naked Capitalism

Lars P. Syll — Statistical inference — a self-imposed limitation

The critique of assuming linearly, homeogeneity, additivity and shift invariance holds not only for statistical inference but also reasoning that is deterministic. Physical processes are not necessarily linear — homogenous, additive and shift invariant.

Assuming linearity concerning agents and their relationships, e.g,  through institutional arrangements, requires justification. This point was made by Keynes and later by Robert Lucas in the Lucas critique about effects of changes in policy. Lucas can be viewed as formalizing an aspect of Keynes' criticism of Tinbergen, in this case assuming shift invariance accompanying change in institutional arrangements.
This essay has been devoted to an exposition and elaboration of a single syllogism: given that the structure of all econometric model consists of optimal decision rules of economic agents, and that optimal decision rules vary systematically with changes in the structure of series relevant to the decision maker, it follows that any change in policy will systematically alter the structure of econometric models. — Robert E. Lucas, Jr., Econometric Policy Evaluation: A Critique 
I would not say that econometric models "fail" as much as they are misapplied, misunderstood, or misrepresented. A theory is a causal explanation. A model is an algorithm that expresses this formally. A formal model is not necessarily mathematical. It can also be expresses using formal logic. 

A formal model articulates the structure of an ideal world, where "ideal" means constructed of ideas. As long as the model obeys the rules of logic and mathematics, it is a "good" model. 

The problem is that anything can be stipulated as an assumption without vitiating the model. As long as the formal rules are followed scrupulously it is a "good" model in this sense.

The question is how useful models are in describing a real world world. Obviously, the model will only be as good as the fit between the ideal world articulated by the model and the real world that the model purports to describe in general terms.

There is nothing "wrong" about assuming ceteris paribus in model construction as a formal process. But if a model that assumes cet. par. is applied as an explanation of real world events, the model is vitiated because it cannot be disconfirmed — it is circular. The defender of the model can claim that all things were not held equal, so the model did not actually apply. Well, that is the point! 

An ideal world is unchanging, while the real world is ever-changing. Unchanging ideal models only apply to the real world in the limited instances where the real world is either unchanging or change is so minimal as not be to relevant to the design problem. 

Regarding human agents, this would likely be a matter of nature versus nurture, which terms out to be difficult to distinguish. For example, optimizing is an assumption that is presumed to be a matter of "human nature," as is Mises' "praxeology. " However, these are asserted as self-evident when they are actually either  empirical claims that require substantiation, or else are based on either circular reasoning or gratuitous stipulation.

There is sometime a temptation to conflate a good model in the former sense of coherent and consistent with a good model in the sense of corresponding to observed data and the pragmatic test of usefulness as an explanation. This is illogical since the meaning of "good" has shifted. This is a type of category error.

The fit of a model is determined by how well hypotheses derived from the general description  are confirmed or disconfirmed by observation and comparison with the model. This is a sine qua non of science versus speculation. 

This makes social science, including economics, somewhat tenuous as science in that this kind of testing is generally difficult, impossible, or unethical. This criterion doesn't rule out social science but limits its scope and requires great care in approach. As a result there is a murky boundary between social and political science and social and political philosophy, and speculation may be passed off as science unless care is taken.

In addition to coherence, correspondence and practicality, simplicity aka economy of explanation is also a criterion. An objective in modeling is to construct as simple a model as possible to accomplish the purpose for which the model is designed, for example, Newton's theory of planetary motion.

In Newton's theory of planetary motion, the planets and sun can be represented by points representing their center of gravity without concern with knowing the details of their chemical composition, since that is not relevant to the task of explaining the invariant principles of motion that govern change in terms of scientific "laws" that apply universally and not only to the local solar system. Because "gravity." Gravity is not observable as a data point like a planet but it is measurable as "force." Gravity is a universal law. 

The so-called economic "law of supply and demand" — actually the law of supply and the law of demand as the basis of familiar supply-demand curves that are based on price and quantity — is not a "law" in the same sense as laws of physics that apply to the real world of phenomena. The "laws" of supply and demand are heuristics used to generate graphs similar to what engineers and designers call a thumbnail. They are useful as gadgets in thinking and teaching, but they are not models articulating a scientific theory that explains real world events in that they do not apply to all markets at all times. The assumptions are too restrictive to be representational.

For example, preference is non-homogenous. There is no representative agent with fixed preferences that corresponds to the modeling assumption. The restrictive assumption used to simplify is simplistic with respect to actual agents. This oversimplification might not make a difference in special cases, but it is not universal in application and therefore does not qualify as a general law on which a general theory can be based.

Owing to the elegance of explanations in natural science, scientists in other disciplines are likely to be tempted to emulate this success. While that is a good thing in the sense of striving to observe the four criteria or coherence, correspondence, practicality and economy, it is not a good thing if scientists doing life or social science become unmindful of the limitations imposed by the subject matter of their discipline. The result will be application of inappropriate methodology and exaggerated claims.

Science is generally divided into natural, life, and social science based on subject matter. Science in general aims at causal understanding of a universe in which natural, life and social sciences are aspects of various phenomena.

Consilience is also a requirement in doing science. Scientific theories are expected to corroborate other and not contradict each other in that science aims at a general explanation of "reality."

As a philosopher looking at economics as an amateur, it appears to me that many economists are careless about applying the above criteria and therefore overstate their claims and likely overestimate their knowledge. as being scientific instead of speculative, and objective rather than interested.

This is even before getting into measurement and historical issues. There really needs to be more attention paid to philosophy of science, philosophy of social science in economics and much more work is needed in philosophy (foundations) of economics, which is underdeveloped since so few people have contributed to it. Indeed, a lot of what passes for philosophy of economics now is mostly ideology. Yet, conventional economists claim that methodological questions are settled. NOT!

It would seem that the pragmatic approach in economics would be using the logic of Adriane's thread rather than matching an ideal world to the real world or, worse, attempting to shape the real world to an ideal world determined by ideology. 

This recognizes that economics is dealing with subject matter that is historical, contingent and dependent on choices under uncertainty that are socially and politically influenced in a context of history, culture, and institutional arrangements.  It is a method for exploring alternatives and evaluating options in terms of tradeoffs so as to find the cheese and not end up in blind alleys. This would involve not only looking out the window but also getting out of the ivory tower.

Lars P. Syll’s Blog
Statistical inference — a self-imposed limitation
Lars P. Syll | Professor, Malmo University

Friday, January 13, 2017

Gregory Elich — Did the Russians Really Hack the DNC?

Detailed and documented analysis of the US intelligence services' account of alleged Russian hacking ordered by President Putin. Fail.
Gregory Elich | member of the Board of Directors of the Jasenovac Research Institute and the Advisory Board of the Korea Policy Institute

Xinhua — Full Text of Chinese president's signed article in Swiss newspaper

Chinese President Xi Jinping published a signed article in the Swiss newspaper Neue Zurcher Zeitung on Friday under the title "A Shared Commitment to Practical Cooperation and Peaceful Development," ahead of his state visit to Switzerland, his attendance at the World Economic Forum Annual Meeting in Davos and a tour of Geneva-based international organizations.

Following is the full text of the article...
Full Text of Chinese president's signed article in Swiss newspaper

Moon of Alabama — "35 Pages" Attack Against Trump Fails - Foreign And Domestic Losses—UPDATED (at end of original)

A peak into the Washington and London snakepit. The vipers are after DJT.

They may have failed to knock him down and after he is inaugurated the strategy will be (political) death by a thousand cuts. This is a zero sum game for control of the most powerful country on earth and there global dominance. The stakes could not be higher. This is way beyond the ordinary political jockeying in transfers of power in the US.

Moon of Alabama
"35 Pages" Attack Against Trump Fails - Foreign And Domestic Losses—UPDATED (at end of original)

Alex Tabarrok — Ransomware Goes Big Time

ArsTechnica: According to the FBI, ransomware payouts in the United States jumped from $25 million in all of 2015 to over $209 million in just the first quarter of 2016.
Clearly, this is just the beginning.
Marginal Revolution
Ransomware Goes Big Time
Alex Tabarrok | Bartley J. Madden Chair in Economics at the Mercatus Center and Professor of Economics at George Mason University, and a research fellow with the Mercatus Center

Edward Harrison — The potential for military confrontation due to Trump’s foreign policy

Edward Harrison examines Rex Tillerson's testimony to the Senate. He is guardedly optimistic about US-Russian relations and somewhat pessimistic about US-China relations.

One problem I see developing with Trump's style as a negotiator is that it is an advantage to insert uncertainty in private dealmaking purposefully. However, uncertainty in domestic and global politics is destabilizing and that extends to economic matters, too. Trump apparently believes he can strike a balance in this regard, but things can get out of hand in unexpected was and have unforeseen consequences. 

Valentina Zarya — Here’s Why Ivanka Trump Hosted a Secret Dinner at Wendi Murdoch’s House

Exploding the Donald Trump hates women meme.
Ivanka Trump may not have an official White House role (yet), but she’s already making moves towards furthering her stated goal of empowering women.
On Thursday night, the First Daughter-to-be hosted an intimate dinner in New York City at the penthouse apartment of Wendi Murdoch, ex-wife of media mogul Rupert Murdoch. The purpose of the gathering was to pick the brains of women who, along with being powerful members of the business and politics community, have expertise in promoting women’s economic development.
One of the attendees, executive director of Fortune‘s Most Powerful Women Summits Pattie Sellers, gives Fortune the scoop on who was there and what the group talked about.
Good for Ivanka.

Here’s Why Ivanka Trump Hosted a Secret Dinner at Wendi Murdoch’s House
Valentina Zarya | executive director of Fortune‘s Most Powerful Women Summits

Thursday, January 12, 2017

Patrick Cockburn — The Dodgy Trump Dossier Reminds Me of the Row Over Saddam's WMDs

Patrick Cockburn has high credibility and he is very careful in his reporting.

The Independent (UK)
The dodgy Donald Trump dossier reminds me of the row over Saddam Hussein and his fictitious weapons of mass destruction
Patrick Cockburn

Larry Johnson — Full Monty–The Russian Red Herring Hacking

Larry Johnson is pissed and rightfully so.
We are witnessing something unprecedented in the history of the United States. The CIA, at least some in its leadership, and others in the intelligence community are helping perpetrate a fraud on the American voters and try to persuade them that a foreign power intervened in our election and, without so boldly stating, leave the implication that Trump was elected because of Putin. It is a damned lie.
No Quarter
Full Monty–The Russian Red Herring Hacking
Larry C. Johnson | CEO and co-founder of BERG Associates, LLC, an international business-consulting firm with expertise combating terrorism and investigating money laundering, formerly Deputy Director in the U.S. State Department’s Office of Counter Terrorism (1989-1993, and CIA operations (1984-1989)

U.A.E. Says $50 Oil ‘Isn’t Going to Cut It’ for Producers

Ha! Well too bad rent seeking m-fers... suck it up fellah...

Non-cartel sector doesn't agree apparently,:

WOW Airline to offer $69 US to Europe

Boy this really sucks... hey let's get the $100 of rent back into a barrel of oil so this goes away....

Vanessa Beeley — Israel Violates Syrian Airspace, Bombs Ammunition Depot in Mazzeh, Damascus

The objective was clearly not just to destroy some ammunition. This is a provocation aimed at provoking someone, likely Iran.

Interestingly, the aircraft is reported as a newly received US F-35, which is supposedly state of the art stealthy. Did it sneak through Russian air defenses, or were they not deployed in this area?

Geoff Earle — Trump conducts his own sting operation to ensnare intelligence briefers – and says he caught them leaking

Maybe this is why James Clapper backpedaled. Especially when DJT said it was an illegal leak since briefings of the president and president-elect are classified. Maybe some folks heard the jail keys jingling.

Daily Mail
Trump conducts his own sting operation to ensnare intelligence briefers – and says he caught them leaking 
Geoff Earle, Deputy U.S. Political Editor for in New York

Did Fortune Magazine just publish fake news?

There is no mention of a hack in the short article.
The network says the problem was likely a routing issue, since RT is one of the networks that C-SPAN regularly monitors.
Anyone reading the headline will come away with the idea implanted that "the Russians" hack C-SPAN.

That's sewing disinformation, especially since it is well-known that most people only read headlines.

C-SPAN Confirms It Was Briefly Hacked by a Russian News Site
Fortune Editors and The Associated Press

Max Boot — Donald Trump: A Modern Manchurian Candidate?

The Council on Foreign Relations spokesperson Max Boot wants Donald Trump to get tough on Russia, worries he is a Russian stooge.

The Council on Foreign Relations is considered to be part of the US deep state, at least the inner circle. It is the most powerful and influential non-government organ of the deep state with deep tentacles into the US government as well as major private institutions. The Council on Foreign relations publishes Foreign Affairs, the premier US foreign affairs and policy journal.

Council on Foreign Relations
Donald Trump: A Modern Manchurian Candidate?
Max Boot | Jeane J. Kirkpatrick Senior Fellow for National Security Studies at the Council on Foreign Relations.

David Stern and Kenneth P. Vogel — Ukrainian efforts to sabotage Trump backfire

This news article is significant in establishing what George Eliason has been asserting about a Ukrainian connection in the 2016 presidential election.

The article is mostly comprised of unconfirmed allegations and countercharges — he said, she said stuff.

However, it shows that there is another dimension unfolding that the neither US intelligence services nor the US media reported that appears to be relevant.

The Clinton campaign worked to sabotage Bernie and apparently Trump, too, and there seems to be a Ukrainian trace regarding the later.

However, at this point it is difficult to impossible to distinguish between assertion and fact, and allegation and evidence in the fog of politics.

Stay tuned.

Ukrainian efforts to sabotage Trump backfire
David Stern and Kenneth P. Vogel