Showing posts with label speculating. Show all posts
Showing posts with label speculating. Show all posts
Thursday, April 19, 2012
Publilius Syrus was right
On Tuesday, the President of the United States said something that implies one of two things: he doesn't know what a speculator is or he thinks we don't know what a speculator is. Frankly, I don't care which it is, because neither is a good quality in a president. Remember when Bush couldn't say nuclear? How much comfort did that instill?
"We can't afford a situation where speculators artificially manipulate markets by buying up oil, creating the perception of a shortage and driving prices higher, only to flip the oil for a quick profit." -President Barack Obama
Speculators are people who think that something is priced too low. If you find a $10 lamp at a yard sale that you turn around and sell for $25 at an antique store, you're a speculator. If you bought into a hot stock tip, you're a speculator. If you bought a lottery ticket, you're actually a gambler, and a poor one at that.
All of those things, though, are voluntary, and require two parties. The guy who sold you that $10 leg lamp would have preferred to sell it for $25, I'm sure, but either getting rid of it quickly was worth something to him or he didn't know its actual value. But, after this transaction, both the seller of the lamp and the buyer of the lamp are happier than they were before, otherwise the lamp would not have been sold. So, in every case of speculation (even on oil), in order for a speculation "bet" to be made, somebody else must take that bet. Somebody on the other end of the speculation thinks that the price they are being offered is, at the very least, fair, if not good. Unless you make all your own stuff, everything you've ever bought you because you thought it was worth the money on the price tag (or somebody else did).
Speculators have been demonized as predatory or parasitic, because they don't make things. However, price correcting does have value and is not without risk. Other people selling lamps are happy to know what they are worth (have you ever looked at what similar items are selling for when you post on Craigs List?). Sometimes the price is not predictable and goes down instead of up or vice-versa, making those various bets go bad. Like Beanie Babies.
The price of oil might be undervalued, too. People are complaining about the price at the pump, but the concept of price is really just a means to distribute resources. Money is valuable because it serves as a store of value and is easy to carry. Food is valuable to me, as are books and candy. How valuable? We measure that in its monetary value. If you remember your supply and demand curves from economics, as the price of transportation goes up, people will still pay (inelastic good), but some will find other alternatives (Biking, carpooling, public transportation, moving closer to work, getting a smaller car, etc.) or suppliers will increase production to take advantage of the higher prices. If that's the case, then it stinks, but your lifestyle will have to change. During the Carter Administration, gas was rationed and price was not the means that the resources were distributed, and instead it was (among other things) wait time. Would waiting in line be less aggravating?
It may not seem fair to the poorer if this happens, but it's not any less fair that the poor don't have Gulfstreams, that the busy may not have time to wait in line for gas, or that interesting people get attractive spouses, either. That's how resources work, really. In fact, there are a lot of people who think extra taxes on gasoline would be a good thing in the long run, implying that there is definitely room in the market for speculation.
There is also the awkwardness of the word "artificially." What does he mean by that? Is he saying that some participants in the market are illegitimate? How is that determined? If I buy a used car for $1500 with the intent on keeping it, but later see on Craigslist someone willing to pay $2000 for it, would that be an artificial transaction? How long would I have to keep it before it's not speculation anymore? Or what if I hire a travel agent? Or buy stock from a stock broker instead of an IPO? Or buy tickets to a Clemson game on Stub Hub? Or just a guy selling tickets outside the stadium? Are they equally artificial? What is a natural price increase? What about the extra costs incurred by taxes? The president could push to lower gas prices by introducing a bill to Congress to suspend gasoline taxes, since they are price effects that are not even made by market participants; at least the speculators have skin in the game.
Now, does that mean Obama doesn't understand high school economics? Possible, but personally, I think it's more that he doesn't like the answer. Like people who complain about their lottery tickets not winning.
Wednesday, December 21, 2011
That's an important o
I read an interesting article on the New York Times blog the other day. It's a philosophy professor at Amherst, Louise Antony, trying to defend her point of view of moralistic atheism. The basic premise is that she considers there to be a natural right and wrong in nature independent from God, whether He exists or not. She breaks down two concepts of morality that she calls the Divine Command Theory (DCT) -- where things are good because God wills them -- or the Divine Independence Theory (DIT) -- where God wills only things that are good.
She talks about how the second is a more enlightened way to think because, well, it allows people not to need God and people like her to feel better about the fact that they are living in a similar fantasy that she thinks people like me do. She has a long explanation about how different the two theories are, centering around the arbitrariness of DCT versus the steadiness of DIT. If "goodness" were a natural property, like mass or electrical charge, then for us to make any use of it, there must be a way to measure (or at least detect) this property. She posits that we can, and cites some examples involving home invasion, slavery and torture. And I think we can all agree that those are in fact, wrong. However, they weren't always.
Private property is a very old concept and violation of it has been considered socially unacceptable behavior outside of wartime in just about every culture as long as we have written things down. Slavery was practiced by just about every major culture for a very long time, with most Western countries banning it in the 19th Century and some Middle-Eastern countries acting as late as the 1960s. The Geneva Conventions were adopted in the 20th Century, not because we became enlightened and grew out of it like witchcraft, but because the practice was rampant and the countries that did not abandon a Judeo-Christian worldview wanted to stop it.
That's not to mention cultures like the Aztecs who practiced human sacrifice, Indians who had the institution of sati until the British outlawed it, the Arab concept of honor killings, and our very own policies of institutionalized racism that were finally taken off the books in the 1960s. I think we can also agree that they are wrong as well.
So why didn't we know enough then that it was wrong? The simplest answer is that there is no universal and innate natural "goodness" outside of an agreed upon standard. The laundry list of sins that humankind is evidence that we need such a standard, and Western culture (and Middle-Eastern culture as well) has adopted the Abrahamic traditions as that standard. Prof. Antony's concept, absent some sort of evidence that this idea of natural goodness can be identified is no different than pagan pan-theism -- there are petty gods in everything (or a single universal force permeating everything) providing its intrinsic value -- not unlike George Lucas's Jedi religion.
She also makes a point about how it is better to be good absent the threats of punishment or promise of reward. Maybe. But if there are no consequences to our behavior, why is it better? We call electrical charge positive and negative, and I always preferred working with positive charges in class because it's easier to work with, and the word negative carries bad connotations. Think of another example. The NCAA has myriad arbitrary rules about what college students can or cannot do in order to play their sport. Reggie Bush used his talent to provide a house for his family beyond their means. However, that was against the rules. Did he do anything wrong? According the NCAA, yes. Is that rule right or wrong? Does it matter?
The largest point, though, is that her worldview requires faith. Just like mine does. And it is intellectually dishonest of her to argue that she is morally superior because she subscribes to DIT and thinks she can arrive at moral behavior without needing God because she's smart, without regard to the moral infrastructure that was built by a history of religious people. The two concepts ultimately are different only in the academic sense that she presents, not in the real world in which we live, because the objectivity she claims cannot be divorced from the culture that surrounds us.
She also discusses interpersonal relationships, and says that by acquiring value through God you are essentially denying the human value of everyone else. We kind of do that now, as well; society determines value by the law, and for a while in the United States, even, black people were worth less than white people, and we even defined the ratio. Fetuses are worth very little in the eyes of the law. That changes when society decides it would. We, as enlightened smart people, changed our minds.
Tribalism, where we prefer and value people who are like us or related to us more than others, kind of fits the mold as well. Most of history was driven by this or the similar idea of nationalism. In many places, history still is driven by them. We look at the Janjaweed and know that they are doing wrong, but they see themselves as looking out for their own people, because they feel that their people are worth more. The Japanese thought they were worth more than the Chinese in Nanking. I could go on.
I suppose her counter-argument would be, "Those things were wrong even then, we just disobeyed them. We were wrong, too." Maybe, but how would we have known? She cites Plato as positing this argument before the birth of Christ, so it's not like we haven't had the material to work this out until the 20th and 21st Centuries.
If there really is a natural goodness we can identify without God, humans suck at it. Christians already knew that, though. We need a standard. Christians identify that as the unchanging Bible and the life of Christ.
There are good arguments about the ability of atheists to be moral people. However, this one, this particularly condescending one, is not it. (That's why people don't like atheists: they tell you that you're wrong while claiming to be morally superior. It's not a very becoming look.) An example is quite simply to follow the Golden Rule -- but then again, that owes its origin to millenia of religious thinking.
She talks about how the second is a more enlightened way to think because, well, it allows people not to need God and people like her to feel better about the fact that they are living in a similar fantasy that she thinks people like me do. She has a long explanation about how different the two theories are, centering around the arbitrariness of DCT versus the steadiness of DIT. If "goodness" were a natural property, like mass or electrical charge, then for us to make any use of it, there must be a way to measure (or at least detect) this property. She posits that we can, and cites some examples involving home invasion, slavery and torture. And I think we can all agree that those are in fact, wrong. However, they weren't always.
Private property is a very old concept and violation of it has been considered socially unacceptable behavior outside of wartime in just about every culture as long as we have written things down. Slavery was practiced by just about every major culture for a very long time, with most Western countries banning it in the 19th Century and some Middle-Eastern countries acting as late as the 1960s. The Geneva Conventions were adopted in the 20th Century, not because we became enlightened and grew out of it like witchcraft, but because the practice was rampant and the countries that did not abandon a Judeo-Christian worldview wanted to stop it.
That's not to mention cultures like the Aztecs who practiced human sacrifice, Indians who had the institution of sati until the British outlawed it, the Arab concept of honor killings, and our very own policies of institutionalized racism that were finally taken off the books in the 1960s. I think we can also agree that they are wrong as well.
So why didn't we know enough then that it was wrong? The simplest answer is that there is no universal and innate natural "goodness" outside of an agreed upon standard. The laundry list of sins that humankind is evidence that we need such a standard, and Western culture (and Middle-Eastern culture as well) has adopted the Abrahamic traditions as that standard. Prof. Antony's concept, absent some sort of evidence that this idea of natural goodness can be identified is no different than pagan pan-theism -- there are petty gods in everything (or a single universal force permeating everything) providing its intrinsic value -- not unlike George Lucas's Jedi religion.
She also makes a point about how it is better to be good absent the threats of punishment or promise of reward. Maybe. But if there are no consequences to our behavior, why is it better? We call electrical charge positive and negative, and I always preferred working with positive charges in class because it's easier to work with, and the word negative carries bad connotations. Think of another example. The NCAA has myriad arbitrary rules about what college students can or cannot do in order to play their sport. Reggie Bush used his talent to provide a house for his family beyond their means. However, that was against the rules. Did he do anything wrong? According the NCAA, yes. Is that rule right or wrong? Does it matter?
The largest point, though, is that her worldview requires faith. Just like mine does. And it is intellectually dishonest of her to argue that she is morally superior because she subscribes to DIT and thinks she can arrive at moral behavior without needing God because she's smart, without regard to the moral infrastructure that was built by a history of religious people. The two concepts ultimately are different only in the academic sense that she presents, not in the real world in which we live, because the objectivity she claims cannot be divorced from the culture that surrounds us.
She also discusses interpersonal relationships, and says that by acquiring value through God you are essentially denying the human value of everyone else. We kind of do that now, as well; society determines value by the law, and for a while in the United States, even, black people were worth less than white people, and we even defined the ratio. Fetuses are worth very little in the eyes of the law. That changes when society decides it would. We, as enlightened smart people, changed our minds.
Tribalism, where we prefer and value people who are like us or related to us more than others, kind of fits the mold as well. Most of history was driven by this or the similar idea of nationalism. In many places, history still is driven by them. We look at the Janjaweed and know that they are doing wrong, but they see themselves as looking out for their own people, because they feel that their people are worth more. The Japanese thought they were worth more than the Chinese in Nanking. I could go on.
I suppose her counter-argument would be, "Those things were wrong even then, we just disobeyed them. We were wrong, too." Maybe, but how would we have known? She cites Plato as positing this argument before the birth of Christ, so it's not like we haven't had the material to work this out until the 20th and 21st Centuries.
If there really is a natural goodness we can identify without God, humans suck at it. Christians already knew that, though. We need a standard. Christians identify that as the unchanging Bible and the life of Christ.
There are good arguments about the ability of atheists to be moral people. However, this one, this particularly condescending one, is not it. (That's why people don't like atheists: they tell you that you're wrong while claiming to be morally superior. It's not a very becoming look.) An example is quite simply to follow the Golden Rule -- but then again, that owes its origin to millenia of religious thinking.
Sunday, May 25, 2008
Graphs Aplenty: Matt Drudge
I myself am not an avid reader of the Drudge Report. I'm not a reader of it at all, I guess, avid or not. Do you ever describe anything as avid other than consumption of various sorts media? (I am an avid watcher of the news. I am an avid eater of salsa. I am an avid sleeper. Do those work?) I don't have a lot of personal insight to add to this graph.
It is important, however, to note that the Y-Axis shows Personal Anger at Matt Drudge and not necessarily at the content being presented. As my avidness in going to the Drudge Report is so lacking, I cannot provide stylistic input as to the potential source of the anger from a "factual" point of view, so I'm just going to speculate that Mr. Drudge is a jackass, and that clearly shows through in his writing. But I don't know that for sure; I need to stress how I am speculating that Matt Drudge is a jackass.
It is important, however, to note that the Y-Axis shows Personal Anger at Matt Drudge and not necessarily at the content being presented. As my avidness in going to the Drudge Report is so lacking, I cannot provide stylistic input as to the potential source of the anger from a "factual" point of view, so I'm just going to speculate that Mr. Drudge is a jackass, and that clearly shows through in his writing. But I don't know that for sure; I need to stress how I am speculating that Matt Drudge is a jackass.
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