Someone who actually knows what they’re talking about says:
Sorry Richard, but while I don’t agree with Tim Worstall on much stuff – particularly his hatred of the European project, and greater backing of tax evasion than I would support – I have never, ever, ever read an argument of yours that managed to refute an argument of his. As an objective reader who sits somewhere in the middle of you both, politically, that is my honest opinion.
The Richard being referred to is, of course, our favourite retired accountant, R. Murphy Esq.
Only in saying that he depends upon an Institute for Fiscal Studies report that assumed that the efficient market hypothesis was valid – a somewhat big leap of faith these days – but to which he obviously subscribes.
Sigh, once again, Ritchie manages to misundertand what the EMH actually says.
It does not say that a market is always the best or most efficient method of organising something. It does not show, nor even attempt to show, that all markets all the time markets markets in everything is efficient. Nor desirable.
It says something which is trivially and obviously true. When prices are set in a market then markets are efficient at processing the information available to them as to what prices should be in said market.
That’s pretty much it really. The weak version really is as I’ve just set it out. The strong version is that even information which is not generally available gets incorporated into prices (proprietary information being incorporated by the effects of those trading on it).
There are implications of this, for sure. Like, you can’t beat the market except through luck or such proprietary information. That price changes come as a result of new information becoming available.
But whether or not pension funds bear the burden of Stamp Duty is precisely sweet fuck all to do with the EMH.
As to the rest of Ritchie’s argument its, look, you rightist bastards, I don’t have to prove that my favourite tax will do anything bad. I’ll just insist that it will stop what I don’t like and it’s up to you to prove that what I don’t like isn’t bad.
Which is a very sad indictment of Richard’s view of the world. Of freedom, liberty and the Rights of Man.
I do not have to prove that my actions or activities are socially useful, desirable or to your taste before I am allowed to do them. You do have to prove that my activities are actively harmful to the rights or person of another (no, you don’t get to stop me if my activities are harmful only to me) before you are allowed to devise methods to stop my actions or activities.
Which means that Richard’s argument fails. For he hasn’t proved, hasn’t even tried to prove, that liquid trading in financial markets produce harm to either the rights or persons of others.
There is a deeper rightwing revisionism at play. Stalin’s crimes are being elevated to a par with the exterminations of Jews by those who want to banalise or relativise the Holocaust and reduce its historical centrality to just another example of wartime mass murders. Stalin’s famines of the 1930s or his deportations in the 1940s are held up as the right creates its own moral equivalence between Nazism and Communism. The latter was foul, evil and those who were Stalin and Trotksy’s mouthpieces in European democracies have done lasting damage to the democratic left.
But Hitlerism’s Holocaust converted an entire nation’s engineers, chemists, railway systems, diplomats as well as the military and the police into an industrially organised network absorbing massive resources as it combed Europe to transport Jews from every remote corner of the continent to be put to death in Nazi extermination camps on Polish soil.
And Stalin’s efforts converted an entire country into a death camp based upon class not race.
So what?
If you want to say that Tories are bastards for hanging out with dodgy Latvians then that’s just fine (and yes, the same point is just fine when asserted about UKIP and Lega Nord if that’s what you want to do). But we really should be taking that biblical injunction to note beams and motes seriously. If a political party having members who attend parades in memory of those fighting for one ghastly dictatorial system means that said political party is beyond the pale then so also is a political party which has members who attend parades in memory of those who fought for another ghastly dictatorial system.
This is as true of Waffen SS veterans as it is of MVD or KGB ones, as true of those who would praise Pol Pot, Cuba, North Korea and, yes, all three of Stalin, Trotsky and Lenin.
As I’ve said before, we can note the difference between people being killed on the grounds of race and and those being killed on the grounds of class. But it’s the killing of people which should be bringing the condemnation, not the grounds for the killing. For it’s the killing of people that’s wrong, d’ye see?
And thus there is a moral equivalence between Nazism and Communism.
Indeed, we might even go further….facism existed in various flavours and only in one instance did it become that pit of evil whereas almost everywhere communism has gained power the flavour of the death camps was similar.
Greece raised the stakes in the row over how to stabilise the euro today when prime minister George Papandreou set European leaders a deadline of next week for unveiling rescue plans for his battered economy and threatened to turn instead to the International Monetary Fund for help.
Clearly exasperated by the lack of clarity from the EU on what it might do to help resolve Greece’s ballooning debt and deficit crisis, Papandreou effectively told European leaders it was time to put up or shut up.
OK, the report itself is obviously true. Unions get taxpayers’ money fed to them through the government, unions then donate large sums to the Labour Party which happens to be the peeps in charge of government.
A gross and vile corruption of the body politic.
It’s illustrated with a picture of a man in a flat cap. Bringing (to my perhaps perverted mind of course) immediate linkages with dour northerners, ecky thump, beer and sandwiches and strikes at the whippet flange factory.
This is either absolutely appalling, in that you didn’t get it:
This was in happier times, before Hunter professed herself to be shocked by the magazine’s pictures of her lying on a bed wearing pearls and no pants, since she was sure the photographer would be interested only in face shots.
Or it’s absolutely superb in that you did and were able to get that secondary reference in to pearls.
Terry Sanderson, president of the National Secular Society, said: “It is unfortunate that the court has enabled Catholic Care to exploit what was obviously an error in the drafting of the equality legislation. The loophole this created was never intended to be used this way.”
Now that’s about adoption and whether an agency can discriminate against those it wishes to (and given that such agencies, even the State, regularly discriminate on the basis of weight, age, smoking, drinking and race, why they shouldn’t be allowed to do so on the basis of sexuality escapes me).
But the much more important point is that we are a society governed by law. It is what the law says, not what the dunderheads in Parliament meant it to say, which counts.
Which is, of course, why we have the distinction between tax avoidance and tax evasion. You owe what the law says you owe, not what an MP would like you to owe.
Tonight, Hilary Benn, the environment secretary, said the ban would have both financial and environmental benefits. It would cut greenhouse gas emissions from landfill sites and from manufacturing new products such as cans and bottles from virgin materials.
It would also save councils money on the landfill tax charged for every tonne of waste, and allow them to make money from selling recycling materials. As existing landfill sites fill up, there is also a looming problem of finding new locations.
And the lie is so transparent. They are still not including in their cost estimates the time it takes households to sort the rubbish so that it can be recycled. They are thus ignoring the major cost of such schemes.
And, yes, I know I’ve been banging on about this for years. However, I’ve now some support from two Nobel Laureates to underpin my basic contention. That time spent doing such things is a cost and a cost which has to be included in our cost benefit analysis.
Mssrs. Stiglitz and Sen did a report for M. Sarkozy on alternatives to GDP as a measurement of how well we’re doing. In it they make the clear and obvious point that household production must be included in any proper measure of wealth and/or income. They also provide us with the metric by which we should value it. The cost of undifferentiated general labour. In our case that’s almost certainly the minimum wage.
Now, true, they are saying that because we cannot measure the output of such household production we should measure the input: the time spent creating that household production. This isn’t as odd as it seems, this is what we do with most Government already. We cannot measure the value of a court system so we simply assume that it adds to GDP what it costs us to have a court system. And so on with much/most of government.
But one of the things you’re not allowed to get away with in economics (as is also the case in other sciences) is to say that we’ll treat this (in this case, household labour in household production) in one manner over here and then in another manner over there.
If household labour is to be valued at minimum wage then household labour is to be valued at minimum wage.
So if we place a geas upon households that they must labour at a certain task then we must value the labour we are forcing them to put into that task.
And absolutely none of the estimations of the costs and benefits of recycling include the value of this labour. Therefore they are all lying through their teeth to us, the arrogant, spiteful, bastards.
Michel Barnier, the European commissioner in charge of financial market regulation, said he would propose controls to curb speculative trading in credit default swaps, (CDS) a form of debt insurance that has been blamed for worsening Greece’s economic problems.
His measures will target so-called naked selling of CDS, where insurance contracts are sold to buyers who do not own the debt.
As the piece goes on to point out CDSs have not been important at all in hte Greek sage. But try to ban them they will using the Greek issue as the lever.
Where this will get interesting though is in the definition of “naked”.
Imagine two scenarios.
1) You own Greek Government debt and are worried, you buy a CDS.
2) You own Greek bank (or corporate) debt and are worried, you buy a CDS.
OK, now, in the second instance, do you buy a CDS on the debt of the specific company or bank that owes you? Sure, you can, but a much cheaper way of insuring yourself will be to purchase on the Government debt. For what you’re worried about is the general chaos of a government default….the impact upon currencies and all that which would result.
And of course the Government market is hugely more liquid than that in the debt of, say, the Athens Water Board who are the people who actually owe you money.
Now we know what people sorta mean by “naked”. That you buy a CDS without owning any of the underlying debt. But does naked include option 2? Will you only be allowed to purchase a CDS on debt that you actually own?
And how will this be defined? If you hold a 30 year bond you can only buy on a 30 year bond (yes, I know, terms are standard at 10 years but….). Or if you hold 30 year 2025, can you only buy on 30 year 2025?
In short, does “naked” mean you must own the exact debt you are hedging against or does it mean any debt which is close enough? And what is the definition of “close enough”?
No, I don’t think anyone’s thought this through either. And, strangely, my best guess is that if you must buy against exactly the debt that you own then the price of Greek Government CDSs will rise as a result. For the market will be hugely less liquid. All of those selling and buying generic 10 year cover on the government debt as a proxy for all of the other possible variations will be blocked out of the market.
And guess what will happen then? Yes, you’re right. The premium which the Greek Government has to pay to borrow will then rise.
This will therefore make the problem worse, not better. Well done chaps.
BTW, this is being brought in by a man who has never had a real job. SpAd then MP. Minister, Commissioner and MEP. Seriously, what does the recent French Minister of Agriculture know about finance?
Dick Olver, who was speaking to The Daily Telegraph at an event designed to boost children’s interest science and engineering, said: “We need more of the very good engineering graduates to go into engineering rather than the financial services.” .
A quick skip through the BAE Systems jobs page shows that you’re offering £27k to someone to sell jets, 22k for a Quality Assurance Engineer and £26k for a Senior Commissioning Engineer….those latter two both on nuclear subs.
It’s not just the City you’re competing against with those wages. You’re barely offering more than average wages.
You want more engineers my suggestion is that you offer more money to engineers.
Brussels’ logic is that by betting against the euro, hedge funds are driving its value down, so making it harder for hard-pressed states like Greece to balance their books, as the market is demanding. This then creates a vicious cycle of more government spending cuts being required in Greece, in anticipation of which the hedge funds bet against the euro again, and so on and on until eventually Greece is either forced out of the euro or goes bust. That’s not a prospect Europe enjoys.
What?
1) Some confusion here surely between the euro and Greece’s borrowing premium?
2) A decline in the euro helps Greece balance its budget….it should stimulate export led growth, no?
3) What on earth has the value of the euro got to do with Greek governmental spending? It could, sure, if Greek debts were mostly denominated in currencies other than the euro but I’m reasonably certain that that isn’t the case.
4) A decline in the euro makes Greece being forced out of it less likely, not more.
No, really, I do think we should be looking to people who actually understand financial markets for ideas on what we might do about financial markets.
Corporations can be big, they can be profitable, and they can be big and profitable. But they cannot be wealthy, for the simple reason that corporations are not people. Corporations are not wealthy; they are a form of wealth.
No it hasn’t you silly little man. Global GDP will be around $60 trillion this year as it was around that last year.
The new understanding goes hand-in-hand with discoveries in evolutionary biology, neuro-cognitive science and child development that reveal that human beings are biologically predisposed to be empathic. Our core nature is shown not to be rational, detached, acquisitive, aggressive and narcissistic, as Enlightenment philosophers claimed, but affectionate, highly social, co-operative and interdependent. Homo sapiens is giving way to homo empathicus.
Fresh ideas about human nature throw into doubt many of the core assumptions of classical economic theory. Adam Smith argued that human nature inclined individuals to pursue self-interest in the market. Echoing Smith’s contention, Garrett Hardin wrote a celebrated essay more than 40 years ago entitled “The Tragedy of the Commons”. He suggested that co-operation in shared ventures inevitably failed because of the selfish human drives that invariably surfaced.
Jeepers…..as if Smith didn’t write a whole great big long book dealing with empathy (what he called sympathy). As if his description of the way we twist and turn watching a man on a tightrope is not mirror neurons, the latest Great White Hopw of neuro-cognitive science.
And Hardin most certainly did not say that co-operation in shared ventures would inevitably fail because of selfish human drives. He said that without some set of rules (which could be social, socialised, socialist, private, privatised or capitalist) *then* such co-operative schemes would break down in the face of human selfishness.
This generation increasingly views happiness in terms of “quality of life”
This is different from what economists have been banging on about with “utility” for a century in what manner?
Seriously, why do people take this ill educated nutter seriously?
