Why I hate Esperanto

I have friends who, in recent years, have expressed an interest in Esperanto, including one friend who is able to speak it. Without fail, they all profess this to be the language of the future. Even after having been shown that it has existed since the 1880’s, they persist by explaining that, thanks to the Internet, this language can become universal and soon our children or grandchildren will all be speaking Esperanto, and so everyone in the world will understand each other and we will have peace on earth and live happily ever after.

I find this a load of hogwash.

Universal languages have been around since the beginning of time. Ever since people started realizing that languages are different and change, they have been trying to overcome this. At first it was by trying to recreate the Adamic language form (or ancient Hebrew). To a great extent, Kabbalah scholars are still trying to do this. Once Latin fell into disuse among the masses in Europe, around the 4^th or 5^th century AD, philosophers have been trying to unite all languages into one. Dante’s Divine Comedy, in the common vulgate, is one example. He did not write in Italian, or in a Tuscan dialect, but gathered different expressions and forms from all the Italic dialects he encountered, trying to find the most communicative form in doing so.

On the other hand, Dante, unlike many scholars before and after him, understood that languages cannot remain the same. When in Paradise, Adam tells him that the language spoken at the time of the Tower of Babel is very different from that which he spoke, because it is the nature of man to change, and therefore his language will change throughout time.

There are some variations to this theory which I should mention. They came about when Europeans discovered the Chinese language and, more specifically, Chinese characters. When the first traders and missionaries came back from the Far East, Europeans were enthralled at the idea that, even though there were many different languages in China, everyone could be understood by writing down universally recognized characters. They could also communicate with the Koreans and Japanese in the same manner, although these also spoke completely different languages. Kircher spent his life trying to prove that Chinese characters derived from Egyptians Hieroglyphics, which had been a sublime form of writing for him. Leibniz, on the other hand, saw Chinese characters as a form of Binary code, or mathematical language (although he did so through a flawed translation of the I-Ching).

The more modern versions of these international auxiliary languages are Volapuk, Solresol and Esperanto. Out of these, Esperanto by far has had the most support. A country between the Netherlands and Prussia was supposed to be founded in 1908 with Esperanto as its official language, but this never came to fruition. Likewise China, after the Xinhai revolution, thought to establish Esperanto as its official language in order to break from the past. This also did not occur.

Therefore, despite all these studies, an international language has not emerged. There is one glaring exception to this: numbers. The Hindu-Arabic numeral system, as we know it today, is used by a vast majority of the world and is understood at sight by virtually every literate person. In other words, if I were to show the symbol “5” to someone, this person would know right away what it meant. Whether this person called it a different name, or spelled it in a different manner, would not matter. The concept would remain the same. Well then, why can we not expect the same out of a language in the future? In order to understand this, we should understand the past, or how the Hindu-Arabic numeral system came to be universally adopted.

The symbols themselves (from 1 to 9) came from India and were adopted by the populace and picked up by traders. From there they traveled through Arabia and Northern Africa, where Fibonacci picked them up. We can credit him with spreading their use in Europe, where people soon discovered they were easier to use than the current Roman numerals (imagine writing an algebraic equation in Roman numerals). But why was this so? It has less to do with the shape (there is nothing extraordinary in the shape of 4 or 5) than with the format. The structure of numbers fits a numerical system with a base number of 10. This is fortunate, since 10 is our base number (in earthly mathematics, at least). It is also relatively easy to writing long numbers and, most importantly, there is no ambiguity in these numbers.

Of course, our numerical system is not perfect. It would be nice to have concrete numbers for such important constants as π and e, as it would be nice if we could find the roots of a quintic equation by following the same methods as we do for a quartic, cubic, quadratic and linear equation. But so far, this is the best system we have, so we stick with it.

Another example, briefly, is chemical formulas. If one person wants to convey Sulphuric acid to someone else, he or she could do so by writing H₂SO₄ and it would be universally accepted. I mention this only briefly because chemical formulas are not commonly used among the populace of different countries. They are also not commonly found in everyday international conversation. I would be hard pressed to find an example of chemical compounds having been used over pints at a bar in order to convey a message between strangers of different nationalities. On the other hand, both patrons of this bar would understand the total numerical amount of the tab, even if they hadn’t been able to communicate one word between themselves.

Which brings us back to the initial question. Why couldn’t we expect a universal language in the future? It has worked with numbers and with chemical formulas. The next step should be languages, right? Wrong. Language is not numbers or chemical formulas. As much as we would like to find greater meaning in the words we use, linguistic patterns develop along a semi-chaotic sequence of popular abbreviations, borrowings and expressions which no one person can control.

If we say “I’ll talk to you later”, someone may abbreviate that to “Talk to you later”, and someone else to just “later”, while another person will start typing “ttyl”. Other expressions, such as “Late” and “Laters” will pop-up, and soon enough the language itself has changed to accommodate peoples’ perceptions. This is how we developed words like textbook and aqueduct, how Bucks became synonymous with Dollars (itself of Slavic origin) and how Milan took the place of Mediolanum. It is for this reason that the Dictionary needs to be updated at least as often as the Encyclopedia, while numbers and chemical formulas are updated only as new ones are discovered to add onto the list we already have.

In short, even if a universal and utopian language were invented, within a couple years there would be different forms of slang; within a generation there would be different dialects and, within 100 years or so, different languages altogether. At this point, a universal language such as Esperanto would just become the modern version of what Latin was during Dante’s time: a universal but dead and artificial language. Then someone may develop a new universal language that will grab peoples' imagination, and the cycle will continue.

The New Hermit Kingdom?

HR 1 became public law on August 3^rd, 2007, after having passed the House and Senate votes and being signed into law by the President. This bill was a recommendation by the 9/11 commission, with one alteration: the requirement that 100% of cargo shipped into the United States be inspected before entering our borders. As reported by the World Shipping Council (in a statement dated June 30), this provision was opposed by the Department of Homeland Security, Customs and Border Protection, the U.S. Chamber of Commerce, all major cargo shipping organizations, ocean carriers, the European Commission, as well as the governments of Belgium, Canada, Denmark, Finland, France, Germany, Greece, Italy, Japan, the Netherlands, Norway, Poland, Portugal, Singapore, Spain, Sweden and the United Kingdom.

The reason for this was not cost nor a lack of belief in security, but because it is an unfeasible law. Section 1701 reads:

a) Container Scanning- Section 232(b) of the SAFE Ports Act (6 U.S.C. 982(b)) is amended to read as follows:

(b) Full-Scale Implementation-

(1) IN GENERAL- A container that was loaded on a vessel in a foreign port shall not enter the United States (either directly or via a foreign port) unless the container was scanned by nonintrusive imaging equipment and radiation detection equipment at a foreign port before it was loaded on a vessel.

For those not familiar with the mechanics of international commerce, here are the main problems with this bill:

1) Who will do the scanning? This is not addressed in the bill. The United States government does not have the resources, so will it be foreign governments? The importing companies? The cargo companies? The foreign ports? Let us remember that the last congress determined Dubai Ports World to be an unacceptable security risk in operating a U.S. marine terminal, yet are we now to assume Congress would allow this same company to scan incoming cargo?

2) Who pays for, operates and maintains the technology? This relates to the point above, yet is not answered by Congress.

3) Which standards do we apply? The rest of the world has different safety standards than those of the United States. We are not able to analyze all incoming cargo according to our own criteria, yet are we asking other entities to find the means to do so?

4) What if other countries decide they’ll do the same with us? The United States does not scan any outgoing cargo. In fact, it would not be able to scan all exports to all 600 ports around the world. Could not another government, or many of them, decide to implement similar legislation as ours and require we start doing so? Do we then terminate trade with these countries?

5) What is “nonintrusive imaging equipment” and what do we do with the data collected? No recommendations are made to this effect.

6) Who will analyze the data and when? Does our government analyze it? Do the foreign ports? Do we wait until all data has been analyzed before starting to import cargo? Do we just keep a file for our records?

Rep Jerrold Nadler (D-NY), a cosponsor of the bill, attempts to refute these objections. His press release on the matter includes this statement:

DHS will set the scanning standards and will have to address some of the logistics of how the scans are to be taken and transmitted to U.S. government officials. We intentionally gave DHS flexibility to work out implementation with foreign governments, particularly because port operations are not the same in every single country and at every single port.

Congress is therefore mandating operations to be taken in overseas ports, according to heretofore-unspecified U.S. standards, which the DHS is to implement at each overseas shipping origin. No discussion has yet been had with these “partners” concerning what the U.S. Congress has decided will take place in these “partners’” own ports.

The simple fact is that this law cannot be realistically implemented, even if we had prior agreement with all foreign countries involved. This, in reality, is not a law but a political stunt. It is one out of many that have been sprouting recently and that can do nothing but harm the health of the United States’ economy, all in the name of National Security.

The effects of these stunts can already be seen; for example: a) Royal Caribbean, the second largest cruise operator in the world, has established a starting point for its cruises in Panama, in order to avoid the ever-tightening Visa controls its passengers must undergo when departing from their current starting point in Miami. b) United States resort locations have long attracted foreign retirees who, because of stringent Visa requirements and terrorist fears, are now finding it harder and harder to buy houses in our country. As a real estate agent in Florida recently put it: "These people aren't taking American jobs, and they're not living on welfare, they're bringing their dollars to feed our economy." Well, they were in the past.

With our current account deficit setting new records, and the world awash in dollars, the U.S. needs to attract more foreign investment, not drive it away. The hysteria in Washington over the proposed Dubai Ports World acquisition of the P&O US ports operation was watched with incredulity from overseas, much like the furor caused by the failed sale of Unocal to the Chinese. With their money not wanted, and finding it difficult even to visit America to examine acquisitions, is it any surprise that foreign investors are turning to other countries for investment opportunities? Couldn’t this be one of the reasons why the dollar is at such a low level?

We should learn from history. The Ming dynasty in China was one of the strongest ever known. It had a standing army of 1 million, managed great explorations, maintained a flourishing iron trade, printed books in moveable type and oversaw a population of 160 million that was, in many ways, more advanced than the European continent. Following piracy along the coasts and currency inflation, the Ming rulers decided to close their borders, build up the “Great wall” and turn inward during the 15^th century. This caused the iron industry to collapse, inflation to continue, rebellions to occur and, ultimately, allowed the Manchus to conquer China and establish the Qing dynasty.

These times require enhanced security, but they also require closer worldwide teamwork. Instead, the United States is closing in on itself, discouraging trade, tourism, and foreign investment. We need to remember that all Hermit Kingdoms throughout history have been unsuccessful. Let’s hope politicians don’t turn our country into a cautionary tale.

Fröhlich Geburtstag! Bon anniversaire! Buon Compleanno! Bun di da naschientscha!

During the 12th century, the dukes of Zähringen were lords of what is now Western Switzerland. When Berchtold V died in 1218, the Zähringer dynasty ended, and these Swiss cities became Reichsfrei (or city states within the Holy Roman Empire). It was during this time that the Kyburg were fighting the Habsburg over these territories.

During this time, also, the alpine passes in Raetia and St. Gotthard gained in importance as ways to pass through the Alps. This suited the Reichsfrei of the Forest Cantons of Uri, Unterwalden and Schwyz. Unfortunately the Kyburg dynasty became extinct in 1273, thereby eliminating all rivals to the Habsburgs for control of these territories. Once rulers, they promptly revoked the Cantons' Reichsfrei status.

At this point, the Forest Cantons decided to conspire against the Habsburgs. They drafted the Federal Charter of 1291 and this formed the Ewiger Bund der Drei Waldstätten, signed on August 1st, 1291, effectively bringing Switzerland into existence. The famous Oath on the Rütli (or Patto di Grütli, as I learned in my History class) is said to have occurred in 1307, although evidence has never been found to corroborate that it ever happened.

Through wars, alliances, luck and necessity, Switzerland was able to keep its independence and add territory, until it became the country we know today.

Some points of interest:
1) Although many claim that Switzerland joined the Nazis during WWII in order to maintain their "neutrality" this is certainly not true. The Germans did draft a plan of invasion for Switzerland but never followed through. The Swiss were also able to maintain independence thanks to economic concessions (made to both Axis and Allied powers), through a general agreement that Switzerland was to remain neutral and (most importantly in my view) due to the fact that Germany had many other issues to occupy its time. It should be noted that there was a Swiss Nazi party, but it never gained any real power, due to the divided and different cultures forming Switzerland. The Swiss newspapers also tended to be very antagonistic towards the Third Reich, with many articles infuriating the German government.

2) Between 1798 and 1803, the Swiss flag looked like this:



3) William Tell never featured in this. His legend only came about in the 15th century, with similar legends featuring in Norse, British and Danish folktales.

Confession

This morning I saw queues forming outside the Bookstores that line my road to work. Since I go to work an hour or two before these stores open, I realized they must be Harry Potter fans waiting to buy the last installment of their favorite series. Only when scouring the news, later in the day, did I read that this highly awaited book is being released at midnight tonight, at which point these devoted fans will have been in line for over 15 hours.

This leads to a confession I have to make: I have never read a word of any Harry Potter book.

Nor, for that matter, have I watched any of the movies. I realize this makes me sound like a contemporary literature snob, but I thought I should redeem myself by confessing it, as well as discussing Harry Potter in this post. Not knowing anything about the story, however, it will probably be a very short post.


I can start by surmising that Harry Potter will survive at the end. I do this by combining my faith in futures markets (which I have previously discussed here and here) with the fact that newsfutures.com lists the chances of Harry Potter’s survival at 75% (as of this writing. The chart below updates automatically so it may show a different number).


© NewsFutures


By just past midnight tonight we should know if this is correct, but I will be following the numbers very closely until then because the last minute changes tend to show the direction the ending will go in more precisely.


There, are, however, some caveats. First, there needs to be enough liquidity. The NewsFutures site lists 20,354 contracts held by players. Since one player can buy in excess of 1,000 contracts, however (once you sign up they award you 200 contracts for free), this is a very low level of liquidity.
Secondly, when I first looked at the site there was a 91% chance that he would survive. This could mean one of three things:

1. The trends have started reversing towards Harry Potter dying and therefore he will not survive.
2. There is not enough liquidity, as I mentioned before, and therefore few trades can skew the market.
3. These being the final hours of trading, there is just a great amount of volatility in the market.


Despite these caveats I'm standing by the theory and betting that Harry Potter lives.


Update (9:20 pm): Harry Potter now has a 99% chance of survival. It looks like he'll pull through.


Update (12:20 am): It looks like I was right, the theory worked, and good ol' Harry Potter made it in one piece.

Terrorism is Vulgar

As long as war is regarded as wicked, it will always have its fascination. When it is looked upon as vulgar, it will cease to be popular.
Oscar Wilde - The Critic as Artist, Pt II


The ‘War on Terror’, while embraced by some, is ridiculed by others. Those who embrace it tend to call for war against the terrorists “on their turf” (in other words, the battlefield), those who do not condone it tend to prefer dialogue with presumed representatives of terrorist factions. Both of these views are flawed.

Terror is, by definition, a state of mind. A Terrorist is someone who utilizes systematic violence and intimidation to perpetuate this terror. As real-life examples, 22 theater-goers are killed when a bomb goes off on the first night of the season, or an airport is attacked with assault rifles and grenades, with 24 people killed and 80 more injured. These, however, were not acts performed by Al-Qaeda, its sympathizers or even, for that matter, Muslims. The first was performed by anarchists in Bologna in 1893, the second by members of the Japanese Red Army faction in the Lod Airport Massacre of 1972. In fact, long before Bin-Laden ever picked up a rifle, many terrorist organizations had brought about widespread havoc.

The anarchists of the late 19th century utilized the telegraph and newspaper as a means of modernizing their terror. Focusing on targeted killings, they were able to assassinate President Carnot of France (1894), King Umberto I of Italy (1900), United States President William Mckinley (1901) and Spanish Prime Minister José Canalejas (1912), among the most well-known. This, in addition to many violent acts and threats throughout Europe and the United States, as well as the calls to violence by several anarchist publications, made the Anarchist movement, or at least its violent wing, a full-fledged terrorist organization.

The RAF (also known as the Baader-Meinhof group) of Germany, the Red Brigades and Ordine Nuovo in Italy, the Japanese Red Army (JRA) and the Communist Combatant Cells (CCC) in Belgium all contributed to the terrorist attacks some older generations may still remember. These groups would at times work in conjunction with the PLO and Carlos the Jackal, among others, and they contributed to a multitude of terrorist attacks throughout Europe, Japan and North Africa. These led to the Lod Airport Massacre (1972), the German Autumn (1977), the assassination of Aldo Moro (1978), the attempted assassination of Alexander Haig in Belgium (1979) and the Bologna Massacre (1980), among many others.

These similarities may well be interesting, but what do they have to contribute to solving current problems and with today’s terrorists? Well, for starters, these groups no longer exist. The ones that do are now either mainly peaceful, such as the anarchists, or simply irrelevant, such as with the Red Brigades. How did these groups dissipate? Was it through tough military action, or through two-way dialogue? The truth is that it was neither. They merely went out of style, so to speak.

The world forgot about anarchism with the advent of the First World War, while most pro-communist terrorists lost their raison d’être with the collapse of the Soviet Union. Does this mean that Islamist terrorists will cease to exist only when a great historical event occurs? Possibly. The fact is, these historical events also made people less enthralled with the movements (the Ordine Nuovo was a far right-wing movement and should have therefore strengthened with the collapse of communism, but it died out like the rest). Therefore, it stands to reason that Oscar Wilde may have been right. Only when people stop viewing them as fierce freedom fighters and start seeing them as vulgar street thugs will terrorist organizations such as Al-Qaeda lose their appeal, and the world will be ready to move on. Unfortunately we cannot know when that will happen nor, more importantly, what will happen in the meantime.


This article can be found on the helium website.

Bon Anniversaire!

Today is Bastille Day, France’s national holiday, and a day which always reminds me of my childhood. Growing up in Europe with an American father I knew that the United States’ Independence day came 10 days before the French national holiday, and imagined them to be more or less the same. As I grew some more, however, I learned more of the differences, as well as the similarities, between the two; and how two insurrections that had occurred for much the same reason could have such different outcomes.

On July 4^th, 1776, fifty six men signed the Declaration of Independence, which made official the American Revolution, where we all know the Americans defeated the British and with it, the yoke of monarchy. It was what happened after this that is unique. The Americans had said theirs would be a country with elected leaders, who would represent the populace and be voted out of office after their terms had finished. What seems to us to be such a natural form of government had never been accomplished before. It was like saying we would be living in Thomas More’s Utopia, or the lost civilization of Atlantis.

When George Washington finished his second term almost all citizens expected him to find a pretense to continue his presidency. In fact, even after John Adams took office, senators would continue seeking George Washington’s approval and favor (which he would respectfully decline) and rather than listening to President Adams, people would heed George Washington’s opinions (until Adams asked him to please stop making public speeches). The fact that democracy endured is, in many ways, more incredible than the military victory against the British.

On July 14^th, 1789, insurgents stormed the Bastille in Paris in order to attain the ammunition and weapons stored inside. Once again, this was done for the purpose of shaking off the “yoke of monarchy”. The insurgents were, of course, successful, monarchy was abolished and a republic was proclaimed. Here, however, is where the story differed. The revolutionaries still did not feel satisfied. The sentiments of revolution had to be appeased through blood sacrifices by the thousands to La Sainte Guillotine. Victims upon victims were found, seldom with any chance to defend themselves, until just an accusation would be enough to have one’s head chopped off. Many personal scores were settled during this time.

What followed was a reaction that we can now say, with the benefit of hindsight, was inevitable. A Counter-revolution broke out, with people wanting to return to normal lives on one side (secretly missing the days of monarchy), and the Jacobins commanding strict loyalty to the republic (by means of supporting the executions) on the other. By the time Robespierre, Deputy for Paris and de-facto leader of the republic, was himself beheaded, around 18,000 souls had been lost to the guillotine.

Then, of course, came the Napoleonic era, the restored monarchy, the Third Republic, two World Wars, a Cold war, and the France we know today. So should the poor French be forever stigmatized because Le quatorze juillet commemorates the spark of an extremely violent, calamitous and ultimately unsuccessful revolution? The fact is, officially speaking, it does not. Officially it commemorates July 14, 1790. This was the date of the Fête de la Fédération, a feast commemorating the events from a year earlier. The French senate decided that this day, as opposed to that in 1789, "cannot be blamed for having shed a drop of blood".

Vive la France!

Gripes

The common theme in all these gripes will be China, and one of them probably includes Mark. But these are still just personal gripes.



My main gripe has been ongoing for a couple years. It has been ongoing against China, but this part includes the U.S. Consulate in Shenyang, which apparently refused to take in a group of North Korean refugees.

Here is an excerpt from the article:

Upon arrival in Shenyang, I notified the authorities at the Consulate of our identities and intentions, to seek asylum and protection for these NK refugees. I took extensive measures, as always, to remain discrete, speaking over safe phone lines and using words and phrases that would signal our situation to educated Consular staff, but not to an eavesdropper. As the group waited a few hundred feet from the main gate of the US Consulate, in view of the United States flag and gates, I was told that someone would call me back.

A while later I received a call from a gentleman who identified himself as a member of the US Consulate. He referred to me by name, and said that they could not accept us, and that they suggested for us to “take the North Korean refugees and go to the UNHCR in Beijing.” It goes without mention that US posts are subject to intense electronic surveillance, and sure enough, a short while later large numbers of Chinese authorities and police began to show up in the vicinity of our location.

You can click on the link above for the full article. I just want to know what kind of sick person is running this consulate (his name is Stephen Wickman, as per the article) and somebody in that consulate needs to be fired immediately.



Secondly, this morning on the way to work NPR had a segment on forced abortions in Guangxi, China (Click on Listen for the full report). Yes, apparently they were over their birth quota so they decided to literally drag pregnant women (some already nine months pregnant) into abortion clinics without explanation. I don't really know what to comment on this. Listen to it for yourself.



Thirdly, most people will have heard of Robert Mugabe, president of Zimbabwe. If not, here is a paragraph from Wikipedia:

The Mugabe administration has been criticized around the world for corruption, suppression of political opposition, mishandling of land reforms, economic mismanagement, and the deteriorating human rights situation in Zimbabwe. According to most analysts his administration's policies have led to economic collapse and massive starvation over the course of the last ten years. Currently, Zimbabwe has the highest inflation rate in the world, and according to the United Nations Economic Commission for Africa, Africa's worst economic performer.

He is also famous for Operation Murambatsvina in 2005, during which some 700,000 Zimbabweans lost their homes. He is also known to despise Nelson Mandela and has a curious Hitler-style mustache. The Economist has a pretty good article on him.

Either way, the generous Chinese government decided to give Mugabe $25M in aid.



I understand it's naive of me to think that, simply because China is becoming a global powerhouse, it should be more accountable than it has been in the past. On the other hand, these days, in order to function in this global economy, countries should adhere to a minimum level of internationally accepted decency. China will not lose its permanent seat on the Security Council, but only because the council is outdated. It will also keep receiving inward investment because of the market that it now is.

It's also true that many other developed countries can act indecently. The main difference is there is open debate about it in these countries, which very often leads to change. Pressure from within or without is the primary catalyst for progressive change. Of the three articles I mentioned one was simply ignored in China, one was leaked using clandestine methods and one was justified with implausible excuses by the Chinese government. This government can feel secure about a lack of repercussions, simply because all forms have been stymied. Not for nothing this blog cannot be read in China.

I also know there are many countries much worse than China. But, as the latest example of a developing country turned superpower, for the next 50 to 100 years China will be looked up to and emulated by possibly hundreds of nations trying to develop. I hope, for millions of peoples' sake, pressure forms and forces it to change before then.



Added May 9th:
And now China is ordering the resettlement of 250,000 Tibetans to "socialist villages" at their own expense. While I think Tibet has used the victim card in the past, I also believe Tibetans deserve a place to live and not be harassed. Not to be confused the the Falun Gong, who I think are now plain opportunists.

Man

In prehistoric times men did the hunting, supplied the food, fought off invaders, weathered the elements and generally provided for their families. Women were revered for their fertility. This had been the natural progression; there was no conscious aversion to placing either gender in a different role, it just happened that way. The way it worked was not very different from Homo Sapiens’s ancestors: natural selection.
This continued throughout the ages. Men defended their houses, villages and communities. Wars were fought, nations were defended and ice ages were overcome thanks to efforts put forth by men. Slowly but surely, advances were made: new weapons, new armor and new equipment. In hindsight the pattern could have been discerned from this point on.
Armies followed strategies, crossbows and catapults were invented, wheels and boats were used, fortifications were built. Strength, however, was still the chief attribute of the survival of any society. The longbow was ingenious, but it needed a strong arm, shoulder and footing. Through time, however, this tended to occur less and less.
Muskets and pistols did not need strong muscles. Cars and tanks neither, not to mention planes. After a number of centuries computers were used more and more to operate machinery for warfare and defense. It was clear by this point that brains were much more important than brawn. Activities from farming to conquest were progressively automatic.
Around the same time men started acting differently. Having brute strength was no longer an advantage. It did not accomplish much in life and it did not attract the opposite sex. Men started exercising their brain and started realizing that women were capable of everything they were, for the first time in human history.
Well, that’s not exactly true; it had been happening throughout history, mostly in spurts of realizations. Plato talked about how women differed from men in physical attributes, but had the same intellectual abilities as the best of men, and should therefore be assigned the same vital functions in society. Thomas More’s Utopia, though not as progressive, had women involved in government, labor and battle. Voltaire was attracted to Émilie du Châtelet because of her intellectual genius (most probably far greater than his). Despite all this, however, women received the vote in most countries only when all counter arguments had been exhausted, and even then with great reluctance.
Women could run a country, conduct a war, explore new frontiers, till the land, provide food, defend a society, weather the elements and perform any other activity needed for human survival. Men started acting less like men had acted traditionally, and more like women. Men did not concentrate on their physical prowess; they eschewed violence and prided themselves in their domesticity and care for their environment.
It was shortly after this that the change happened. At the time it was called the Misconception, among many other names: parthenogenesis was the proper term. What was clear, however, was that this was one of the most drastic evolutionary jumps, if not the most drastic, in the history of humans and all mammals. Some women were worshipped as new Madonna’s, while others were reviled as whores. Some had followings, while others were executed. Their children were treated in the same manner. Nevertheless, the trend became evident and undeniable: women were conceiving by themselves.
What started out as tragedy and fear slowly became increasingly controlled. From the great Misconception women soon learned how to have more and more power over their pregnancies, while medicines perfected this mechanism. This was going hand in hand with another concurrent phenomenon: almost all the newborns were females.
At this point it did not take much intellect to decipher what was occurring. Rape, Sexual assaults, molestations, Syphilis, AIDS, prostitution, spousal abuse would all be things of the past. No more bikinis, no more Burkas. And an entire gender would be erased from existence.
To recount the number of scientific studies and experiments which occurred in an attempt to reverse this trend would be useless. Heads of state talked of promoting the male gender. Couples were encouraged and enticed to produce male children. The change, however, was inevitable.
And now here I lie. The last male specimen. I have spent my life in seclusion because of the danger I am to myself for being what I am. The women I had contact with would stare at me intently, stroke my cheek to measure its coarseness, listen to my voice with curiosity. They would ask me about my sports skills and my male organs.
After my death, which is rapidly approaching, males will be consigned to history books, at which point we will be akin to fictional characters, such as fairies and ogres, or a sub-species: Cro-Magnons or Australopithecus.
I do not know if there is a God. I do not know what life means. I have stopped hoping that the male gender will recreate itself. Parthenogenesis has occurred in insect and plant species in the past, although a gender in itself has never become extinct by itself.

Nothing endures but change.
Heraclitus

Dumb Agent Theory

This is the theory that my thesis is based on. It is a theory that has been observed time and time again, although never proven per se. I am applying this theory to a future’s market, which I believe can be used as an indicator; in my case, for Foreign Direct Investment.
Right away I will say that this theory, being unproven, could be seen as rather tenuous to base my whole thesis on. It would be as if I had constructed an instrument capable of saving the Roman Empire based on the theory of Time travel. On the other hand, many occurrences, especially in physics, have been based on theory. The most prominent example is gravity, which comes about basically through process of elimination. Although this is all we have in theory, we have seen it in practice many times, and many other theories are based on it, such as observing the gravitational pull of stars in order to determine the position, size, mass and movements of planets that cannot be seen. That is why I treated this theory as such. Since it has been observed time and time again in many markets, and has never been shown to be incorrect, I assumed that it was correct.
Lately, however, I’ve been wondering if this is wise, so I decided to delve into the theory behind what happens to see if I can make sense of it.

The basis of any market, is the value of the underlying object or entity, or, more precisely, its utility. The difference between these is that an object could have an underlying value that is never utilized/observed/understood etc. I won’t get into whether something can be of value if it serves no purpose since that would bring me down a philosophical road I won’t know the first thing about. I will say that the value of any object or entity is its utility.

So, let’s take Object Alpha. Alpha has a utility, and therefore a value, of X. Can we guess what X is? If I were to guess I would probably say a number that is too high or too low. If any other person guesses, he or she will have the same results. How can we correct this? Well let’s take the other extreme: If everyone in the world guesses, values will be all across the board. But there will be a mid-point (or equilibrium point, or an amassed perceived value). This point must, by definition, equal Alpha’s value. If everyone estimates its value based on their perception of its utility, the amassed perceived utility must equal its real utility.

This follows along the lines that if I were the only person who could ever possibly achieved any utility (be it positive or negative) from Alpha, my perceived utility would indeed be its value. Therefore, everyone in the world together would be able to discover Alpha’s real value. So one person could achieve any value for Alpha, while everyone in the world would achieve its true value. In fact, everyone that gets any form of utility from Alpha would, collectively, be able to find its true value. Following this theory we can see why more liquidity means more preciseness in determining Alpha’s value, which basically proves the theory.

But what still bothers me is, if this theory can be shown to be true, why isn’t it used more often? I know companies have started using it, especially hi-tech companies, in order to determine what trends will last or pass away. How could one know ahead of time how big the I-pod would be, or how wireless keyboards would not pick up at all? It is also being used in order to predict outbreaks of influenza (I use this as a case study in my thesis) and has been shown to work well even with a very small number of traders. Maybe, like any idea, it just needs to have its time. When a market was proposed where people could trade on likelihood of a terrorist attack the Policy Analysis Market, the idea was immediately crushed in the house and the pentagon had to get rid of it. I still don’t understand why.

Anyway, if anyone has any thoughts, comments or constructive criticisms please let me know as I’d like to know this stuff backwards, forwards and sideways.

Surely my masters will come to get me. Surely they didn't love me all that time for this.

-Laika, the Space dog

Conspiracies

I walked into Borders yesterday, and noticed a book called “The Last Templar”. Thinking this might be a new book about Jacques de Molay, since he was the last templar, I picked it up. The front flap proceeded to talk about how men dressed as knights galloped on horses down Fifth Avenue to steal something, at which point I closed the book and placed it back. It might as well have been discussing the lost continent of Mu or Atlantis. I then see that the front stand still has copies of the Davinci Code (along with all the books that explain it). Readers, it seems, cannot get enough of conspiracy theories. Umberto Eco said it 20 years ago: “If someone brings up the Templars, he’s almost always a lunatic.”

And why not? Monk warriors who conquered the Holy land, lost it, came back to Europe richer than the kings or the pope, developed letters of credit before the Florentine bankers, inspired fear in everyone, and then were all captured on the same day (Friday the 13th) on charges of heresy and burnt at the stake are just asking to be glorified. Add to this the fact that they built their headquarters on the supposed Temple of Solomon (Hence their name), that their insignia shows two knights on one horse (Hence the charges of homosexuality) and their strange knowledge and rituals (They interacted with the Muslims in Palestine who, during the middle ages, were much more advanced than the backward Christians), and you can create hundreds of plots for your books.

But there have been so many more throughout the ages, from John Dee to Madame Blavatsky. The Illuminati were behind the French Revolution. Marco Polo made secret trips to Canada. The Egyptians colonized Mexico (And the Greeks colonized the Yucatan). The Venetians sabotaged the Tower of Pisa. The plague was part of an Indian plan of World domination. Everyone worships serpents. The continent of Lemuria. The whore of Babylon. And aliens aliens aliens.

One that occasionally still makes the rounds is the Pyramid question. How come you can find Pyramids on both sides of the Atlantic, from Egypt to Mexico? And why are they more or less (give or take as much as you like) at the same parallel? People seem to love this, and take it as proof of a conspiracy. By someone. Somewhere. For some reason. The fact is, pyramids are easier to construct than spheres. If you want to make a huge building, and the wheel hasn’t even been invented yet, what shape will you make it in? The fact of parallel has more to do with climate. As humans were able to deal with cooler climates they were able to migrate further North (witness the progression of civilizations: From Egypt to Greece to Rome throughout Europe). Then again, there’s a theory that the pyramids were just constructed to confuse further generations. But doesn’t that sound like an Age of Enlightenment conspiracy?

Obviously I’m just as guilty as the next person of being a sucker for conspiracies. But how can I resist? Take numerology for example. The best numerologist (i.e. most entertaining) about the pyramids was Charles Piazzi Smyth. He said the Great Pyramid was constructed by God; after all, its height is exactly one billionth the distance between the earth and the sun. And the pyramid inch is exactly 100 millionth the speed of the earth. This is a good source for these numbers and many more like them, some of which get pretty complicated.

On the other hand, I have my own doubts about the pyramids. They were constructed out of limestone. Wouldn’t the Egyptians have known that you can melt limestone at 600 degrees, thereby making it easier to carry? But then again I know nothing about the subject. Back to conspiracies:

A big one recently may or may not be a conspiracy, a myth, or truth. I’m referring to the map that proves the Chinese discovered the Americas in 1418, 74 years before Columbus. The map is from the 18th century, but is supposed to be a “genuine copy” of an older 1418 map. I’m agnostic about this, but I am still very hesitant in jumping onto the whole ‘Chinese discoverers’ bandwagon yet for a couple reasons. Well, I have not read Menzies’ book, and I don’t speak a word of Chinese, let alone ancient Chinese; I am also not a cartographer and my only source of Ming Dynasty China is books about Matteo Ricci, so I am the last person who should be commenting on this, but I will anyway. First of all, the map is divided in hemispheres. While the Chinese may have known that the world is round, the Europeans were the only ones who divided maps into hemispheres. And secondly, it seems ridiculous that someone as well known as Zheng He could have had this map made, and then no one spoke of it ever again until last month. A map of the world would most likely have been an item of interest for someone. Either way, I might be proven wrong, but I cannot judge only based on a map that has not been refuted. History is not really based on logic, it’s based on what happened. With one map by itself it’s hard to tell. As we learned in Geometry, using just one data point you can draw a line in any direction.

While I believe it’s a good thing to stop having such a Eurocentric view on the goings on of history (witness that all the conspiracy theories mentioned have to do with European history). A publication with as little proof as this pours more scorn on other more serious theories and just relegates the lot to the fringes.

As a side note, I have found one conspiracy theory dealing with Korean history, having to do with writings at the onset of the Chosun dynasty, which said that it would last 600 years (it lasted 613), would be followed by 100 years of turmoil, after which there would be 1,000 years of a Korean rebirth (I don’t recall the exact words unfortunately). This would technically mean that the rebirth started last year.

And what else? Well, the obvious. There are 9 characters in ‘September’ making the ratio 9-11 with the number. The Kights Templar were formed in 1118 (1+8=9 and 11). The atom is a Jewish conspiracy. The lost tribe of Israel traveled to the Americas. Davinci and Tintoretto painted proof of Jesus’ wife and child. The Masons. The Priory of Sion. Whoever else.

All pieces of evidence contradict one another but they never refute each other (The Luciferine Church and the Order of Satan will disagree, but never denounce each other). On the other hand, authors writing about these subjects can sound knowledgeable by referring to works of literature by other authors who write about these subjects who, in turn, refer back to these same authors until it is all one big Escherite referral game. This is how narwhal horns came to prove the existence of unicorns. Conspiracy theories are wonderful in that one can collect any evidence that promotes the conspiracy, while all evidence refuting it is obviously part of the cover-up. I need to choose whom to believe, but in order to do so, I need to choose the criteria with which to choose whom to believe. But how do I choose that?

Why not start with St. Augustine, since he shares my same birthday? Write my own book of confessions? Plan a city of God? Then again, he would shun the amphitheaters for their barbarous and useless act of wickedness, but he couldn’t stop himself from watching when a dog chased a hare and ate it. He recognized this as morbid curiosity about something bad and of no use, as I have with my useless readings. So we’re on the same page in that sense. On the other hand, who hasn’t rubbernecked?

So in conclusion my logic has found that I am human. Let’s hope tomorrow’s a better day.

Remember the North Korean Cheerleaders?

I remember when I was living in Seoul the Asian Games were held in Busan, and then the Universidad games in Taegu. I remember that for both these games, the biggest hits were the North Korean cheerleaders. They were extremely good looking girls that came cheering for their team, with DPRK and Korean unification flags. In fact, much more airtime and newstime was spent on them than the rest of the games. And not without reason: they were sweet cheery nice girls from North Korea. When they weren't performing their cheers ("Skill! Technique! Focus!") they were staying at a hotel off-limits to anyone else (many young guys would drive up there to meet them and get turned away).




And then there was the incident with the Kim Jong-il poster, which was a bit strange, but interesting. They were in the bus going back to their dormitories after a game and noticed a banner of Kim Jong-il and Kim Dae-jung that was in the rain, and close to the ground. They started shouting for the bus driver to stop, and in fact one girl slammed on the breaks herself. Then they rushed over to the poster and took it back with them, so that the picture of their Dear Leader wouldn't get ruined.

I also remember how South Korean girls would throw written notes at them from their stands during the games. The notes were always innocent, as in "I hope we all get to be together soon", and they would all scream and cheer together with the south koreans after each of the notes.

Either way, for those who lived in Korea during this time, these cheerleaders were a big event. Guys would ogle over them, and girls would cheer them on. They always had smiles on their faces and watching them made reunification seem so much closer at hand. For once it was nice to see South Koreans genuinely happy, and North Koreans looking excited to be there, both groups sitting right next to each other on the stands, without politics getting in the way. I bring this up because apparently they're in a gulag now.

Blogs of more value than mine

I usually skip over most of the forwards or back-and-forth bickering that occurs on our school listserv. I just happened to read one yesterday because it was before my morning coffee and I clicked on it without thinking. Either way, I thought it was pretty interesting, and a good sign. I'll just copy the main body of the e-mail here since I have nothing of value to add to it, except that this could be an interesting tie-in to last week's Economist article about home-grown revolutions:



===
Iranian blogs debate nuclear row
Blogs are relatively unregulated compared to other media in Iran.
Iranian bloggers are commenting extensively on the nuclear row between
Iran and the West.
A significant number of bloggers seem to blame President Mahmoud
Ahmadinejad in particular for the crisis and suggest that he has taken
Iran to the brink of war.
The sports lovers are worried that the Iranian team may be expelled
from the World Cup because of the nuclear issue and Mr Ahmadinejad's
comments on Israel and the Holocaust.
There are expressions of confidence about support for Iran in the
Islamic world and suggestions that Iranian politicians are playing a
sophisticated game.

...
'Deflecting public opinion' - Daftar-e bi Mokhatab (Notebook without a
Reader), 17 January
"Mr Ahmadinejad didn't mention in any of his campaign slogans that, if
he became president, he intended to remove Israel from the map...
"I also don't recall him promising that he'd take the nuclear file to
the point of having international sanctions imposed on the country,
having the file referred to the Security Council, sacrificing the
country's economic interests and war...
"What has brought the government to this point today is that it's
realised that it's not capable of fulfilling even 55% of its campaign
slogans... so it wants to deflect domestic public opinion by creating
constant international crises in order to pretend that it's foreigners
who are preventing the government from fulfilling its promises."
(http://hanif.ir/)

...
'Count yourself lucky' - Khatt-e Qermez (Red Line), 24 January
"Today, my American professor told me: You Iranians should count
yourselves lucky that we attacked Iraq, because if we hadn't attacked
them, we'd have attacked you by now!"
(http://vahid.blogspot.com/)

...
'Congratulations Mr President!' - After Rain, 16 January
"Greetings Mr President [Ahmadinejad]! I wanted to congratulate you.
God willing, you're on a roll, taking our dear country towards ruin...
I won't allow the flames of war, ruin, famine and wretchedness to be
lit in my country. I don't want to be shamed any further before the
world. I don't want war! I don't want nuclear energy. This oil is more
than enough for me."
(http://after-rain.persianblog.com/)

===

Tonight's thesis

So I've been forbidden from writing anymore about Behavioral econ, which suits me just fine. Even though I was going to write about how there's a theory that the ultimatum game and the dictator game, two tenets of Behavioral economics that are used as prime examples of it, might actually turn out to be extremely rational. Well whatever, I was pretty much going to plagiarize from a bunch of Economist articles anyway.

Otherwise I've got nothing much to write about. Except about how I have no imagination, which I of course blame on my society. I think we're going through a period now that, although everyone keeps touting as revolutionary and unprecedented, will be remembered as extremely uninventive. The easiest example is looking at contemporary movies. Some recent box office hits have been King Kong, Chronicles of Narnia, Pride and Prejudice. These are obviously remakes of older books and/or movies. This seems to be a trend currently, with very few exceptions, especially compared to other times, such as the end of the 19th century, with works of art such as those by Hans Christian Andersen, Robert Louis Stevenson, Lewis Carroll, the Brothers Grimm, that guy who wrote Treasure Island, Tolkien, etc. Great. That took me nowhere.

Actually, as most of you know, my subsitute for Morandi's here is reading history books, a majority of which are of the middle ages. So here's my thesis for tonight: in my opinion we're going through another form of Middle Ages. That period of history also known as the Dark Ages, where everything seemed to be at a standstill. The first piece of evidence for this is our subconscious obsession with the middle ages: the infatuation with LOTR, Harry Potter, Narnia and other Medieval-style stories. Star Wars movies needs scenes of grand armies approaching and fighting each other on huge scales over vast terrains; just as tear-jerkers use the concept of love as a feeling that can destroy as much as it rebuilds, which first came about in the middle ages.

Right away I guess people will say that nowadays we are advancing at an extremely rapid pace and are having new inventions so quickly that it is hard to keep up. This is true, but tell this to someone who grew up expectantly in the 60's, and has not yet been able to see the promised colonies on the moon, or the flying cars. Instead we have Ipods and telephony. It's true that we are advancing rapidly as, they did for that matter, during the middle ages, but I think it will take a new Renaissance for us to find real revolutionary uses for these advances.

During the Middle Ages everyone was very religious, and now we aren't, right? Well the ones who are most religious (as in, fanatical, such as Bible-belters and Islamists) are not the ones bringing improvements to life. But that's the wrong way to see it. Fundamental islamists are like the Circoncellians, giving one final push to promote their way of life, as the Bible-belters could be the Cathars, offering a religion that is “Born again” to people who can accept it. And on the other side we find left-wing “anti-religionists” who, like the old “populist” clergy, is quick to denounce the new Cathars for their moral absolutes, but when confronted with racism, the environment and (of course) globalization, will only accept absolute truths, displaying the puritan mentality so prominent in the United States yet so denied by these same Americans.
So the absolutes will go both ways, as contradas, towns and fiefdoms refused to accept the values of their neighbors 1000 years ago. Certain groups will say religion is the biggest difference between these two ages, while opposing groups will say it is the moral degradation, as Dominicans and Franciscans argued in the past. On the other hand, what is the difference between Joan of Arc and Che Guevara; both rallying populaces against evil occupiers and dying in the process? And pop singers and movie stars are the new saints: the non-elite who achieve power through their efforts (usually of charisma) and become our models of behavior.

We observe these models not by reading about what they think, but through visualization. Our movies and special effects are mediums that reach the population as bright, colorful paintings and stained glass did in the middle ages. Both have messages to convey and lessons to teach, and both will denounce the feudal lords. These lords own great palaces, which common people can enter and admire, but where the top and more inaccessible quarters are reserved for the lords themselves. Whether we mean the Sforzesco Castle or Trump tower makes no difference.

The middle ages were a time when people were more likely to visit Jerusalem than the villages in an adjacent valley. As more New Yorkers today will visit Paris than Poughkeepsie.

Monasteries used to be closed-off communities, surrounded by barbarous alien people, and in which monks used to spend their days shut off from the real world, with their noses in their books, trying to achieve some sort of Utopia. Academic institutions of modern times perform the same function, and the neo-marxist utopia being sought today remains just as elusive as Thomas More's. Judging by history, in that case, while some ideas of the new rebirth will take place within these walls, the vast majority will only take hold within the least expected corners of society, among people trying merely to carry on with their own lives. From these areas, therefore, we must expect the new renaissance.

A case of Behavioral Economics

My Final paper for Behavioral Economics is due tomorrow, so here's what I started writing:

Several months ago, France and Denmark held votes on whether to approve the EU constitution. Both countries decided not to accept it. One of the main reasons for this, at least in France, was an antipathy to Globalization and world trade. France, as a country, has not welcomed free trade for a number of years now, but lately the antipathy has grown. After the election, even politicians of all stripes started denouncing the Evils of trade and liberal economics. This paper will endeavor to show that France’s population is acting in an irrational manner, as well as the fact that French politicians know this, and therefore are very experienced in many tenets of behavioral economics. Were the French to embrace globalization, the country as a whole would be much better off, while were the French people to close themselves off completely (as they say they want to do), they would be much worse off.

Many of the roots of this antipathy towards globalization can be found in the inception of the Common Agricultural Policy, or CAP. This policy established subsidies for farmers, mainly French, who were trying to survive after the destruction of World War II. In these days, the idea that Europe should try to be self-sufficient in case of another world war (and because it was not able to feed itself after the war) was the main reason for establishing the CAP. Today, almost 50% of the EU budget is spent on CAP, with French farmers still the main beneficiaries. Because of this, farmers in other countries, including other countries in the European Union, are not able to access the French market, which creates ill-will towards the French government. French citizens are also paying more money to maintain these farmers. This is because the farming subsidies need to be paid for with taxes. These taxes are then paid to farmers, who produce too much, and sell the remainder of their goods very cheaply abroad. Therefore French citizens are paying for cheap foodstuffs to other nations.

If the French had no CAP in place today, and were given a choice between installing it or not, they would probably choose not to. But, given the fact that it is already in place, they choose not to do away with it. This is because they are told it maintains their way of life. In a sense, they are scared of the changes that may occur. This is an example of Loss aversion. It is curious, however, because an entire population exhibits it collectively. One could try to argue that the French are just being Risk Averse, which may still fall under economic rationality. However, any careful analysis of the situation shows that their welfare would be much higher as a whole without these agricultural subsidies. The only ones acting rationally in this case are French farmers (about 4% of the population), who receive the benefits, as well as French politicians, who benefit off the French population’s irrationality.

Dealing with globalization in general, however, the French tend to have a general antipathy. They see foreign companies as encroaching upon their territory, and taking over. President Chirac said that “France will never let Europe become a mere Free-trade area” . Using that wording is a manner of attracting sympathy. The French population, generally speaking, does not like free-trade. The negative incidents and effects of free trade tend to be highlighted, while the benefits are rarely discussed. This is an example of Confirmation Bias of the population as a whole. The suffering and bad effects of globalization are talked about much more frequently, and the politicians know it, while the more positive effects are not, so the politicians also decide not to discuss them.


Only farmers benefit. People lose out (higher prices, other countries mad)
Loss aversion: Risk averse.
(Representativeness: Evil companies, corporations)Confirmationan Bias.
Other companies M&A: more FDI, more jobs.
Allow more French M&A: Expect retaliation
New news: Confirmation Bias (African countries not doing well).

And at this point I realized I was just trying to find more reasons to say bad things about the French and that, although it's plenty fun, I probably shouldn't turn it in as my Final paper.

Not to mention the fact that the case for average citizens being Economically Irrational and politicians being more Rational, as weird as that may sound, can probably be made in every country. Most forms of subsidies, especially in developed countries, can constitute some form of Inefficiency, and I'd probably say that any time there are lobbyists involved, the final outcome will be Inefficient and therefore Irrational in terms of the average citizen. So in conclusion this would mean all countries are Irrational and therefore all economics is irrelevant.

Dead Weight Loss of Xmas

I realized over my Birthday what a loss Birthdays and these gift giving holidays are. We all follow this tradition of choosing something to give our loved ones, which they have about a 50% chance of liking, and then receiving gifts that we have a 50% chance of enjoying ourselves, and then calling the whole thing a success. I think it's interesting how rational human beings can follow the same routine year after year and realize this Dead Weight loss year after year.

Just for the record, I'm not talking about anything any reader may have given to me on my Birthday. Ok ok, I'll speak hypothetically about Christmases, and analyze what goes on. Basically, person A finds a gift for person B and vice versa. A doesn't want to give cash, because that's assumed to be tacky, and wants to give something that B doesn't expect. B is thinking the same. Assuming these 2 people know each other fairly well, A will buy a present that B has a 75% chance of enjoying. However, if B had just received the cash, it's very likely he or she would've bought a different model/color/edition/version etc. etc. I will then (optimistically) say there's a 33% chance that the present is EXACTLY what B desired. Counting in the chance that some other person (C or D etc.) gives the same or similar present, I will bring it down to 25%, which I still find rather optimistic.

So Person A is spending 100% of the price for an object that person B will get 25% of value from, and Person B does the same to A, resulting (let's count percentage as utility) in (25x2)-(100x2)= -150 utiles. For every Christmas, and times the number of people involved.

So both A and B lose out, and where does the extra utility go? The answer, obviously, is to the manufacturers. Well, assuming Person A and B aren't entirely nitwits, they'll know there is an element of risk with each present, so they will try to maximize their chance of providing as high a utility as possible. The manufacturers will help them with this by making products: A) discounted, B) look expensive and thoughtful. Therefore, the best way for the manufacturer to sell products on Christmas is entirely through signalling. Person A will care less about the inherent value of a present, as long as it signals value to Person B, and vice versa.

Person B, on his part, will know this is occurring and expect a present to show more value than usual. In other words, he will assume that Person A spent the least amount for the highest amount of possible utility. So therefore B will assume discounts, rebates, etc. etc. Which means Person A could buy a present for 100 utiles of value, while B will assume it to have been something less (say 80), and A chose that because it was discounted or available in bulk etc. Here we're assuming Person B knows the inherent value which, if it's something Person B wanted in the first place, is safe to say he'll know.

Well, I might be missing something, but it seems to me that in conclusion you're better off giving money, so that everyone knows the value and achieves the full satisfaction, while with presents they'll know the value, assume it cost less, and only achieve 25% satisfaction from it. So from now on, everyone can just give me cash. Thanks.

Thesis blabbering

Ok, there are several things I wanted to talk about, but I'll discuss my thesis now, since it's rather pressing for me, and it's really long and boring.

In a nutshell, my thesis idea is based on the efficiency of markets and on rationality in general. Predicting future events is never an easy task, in that no one has a crystal ball. In International affairs we see this with country evaluators. Many institutions and organizations spend a great deal of money and resources in trying to predict economic risk, political risk, debt default rates, human rights indices, among many others. The problems with this are obvious. Variables may be missing, not relevant, or weighted incorrectly. Analysts can also be biased or have other aims.

My idea would be to improve on this by changing the method entirely. Basically, looking at empirical data, markets have been more precise in predicting events than any form of polls or analysts. Markets use an infinite amount of information, gather it together, and incorporate it in the security much more quickly than any single agent would be able to.

This might seem weird, in that any form of analysis of trends or fundamentals would make no difference. Well of course information can be useful, but it's also known that constant investment in a diversified porfolio (read, shooting darts at a WSJ stock list) gives you just as good returns as any.

Ok, there's also one interesting example of this. Michael Maboussin, a business prof in Columbia, asks his incoming students every year what the total number of assetts for IBM was in 1989. Obviously, their answers are all over the board (no one knows that by heart). But, every year, the mean of the glass is within 5% of the true number. Cool, eh?

Anyway, so that's all fine and dandy, and I can find 100 more examples of this, but in order to prove my point, I'd like to recreate it.

Ah, by the way, my idea would be to use this market method to predict FDI into different countries. This could serve public policy in that, if we have a more precise way of predicting this, then companies, organizations and others can use it as an indicator.

Ok great, so now I have to try to recreate this whole market in a lab setting, so I'm wondering what to do. Since I'm getting no funding my options are:

A) Send out e-mails to many people, telling them they can trade on future values of say 5 countries, and they're given an endowement of $1000, and they can trade until the day before new FDI levels (for 2005) are announced. The more precise ones are paid off. (trading would be done by e-mailing me, and i'd post what levels we're at at the end of everyday or week)

B) Perform this in a lab. One of my professors offered this, but since a futures market should be conducted over time and with new information and whatnot, I said it wasn't ideal.

C) Take experimental Econ next semester and do it as my major assigment.


Anyway, I'm going with option A for now, and seeing if it's feasible. Option B wouldn't reflect real life enough, and Option C is too late for me (there's still a chance none of this works out, in which case I'm screwed).

So that's basically it. I'm just writing it down because I have no idea what's going to happen with this. So it'll be interesting for me to look back in a couple months. Or not. Actually it won't. There's a big chance that none of this works out, in which case I'll be changing my thesis to the 6 party talks on North Korea. But I don't know when the cut off date for this should be. At some point I need to choose one or the other and stick with it, otherwise I'll be spreading myself way too thin.

If you got through this whole thing I'm impressed. But if you have any suggestions please let me know. I hate being all up in the air like this.

Connections

Ok, I learned something interesting about connections in my OB class.
Connections, or contacts, can be classified in two main groups: Close contacts and Institutional contacts. Close contacts would be close friends and whatnot. Insitutional contacts are ones you can still use for jobs or whenever needed, but they aren't as close. The question is which are better, and how many, in what sort of mix, etc. etc.

Anyway, in class we came to the conclusion that it is best to have contacts in many different groups. In other words, to have a contact in investment banking, another one in law, another in medicine, etc. That way, you can use your banking contact for any banking needs you may have, or your law contact for any legal needs, without too many redundancies. Plus, if your legal contact needs some investment banking help you can be the middleman, which gives you that power and makes sure you're not a redundant member of some group, as in they need to turn to you, like so:


PEOPLE IN INVESTMENT BANKING <-----------> ME <--------------> PEOPLE IN LAW

(Those arrows mean they are connected. Ok nevermind)

However, then we learned about a study performed at the Pentagon where contact groups were analyzed, and they found that there was precisely this sort of relationship going on. There were higher up managers, lower managers, and one person who was seen as the go between and the person people turned to (As a sidenote, no one saw him as this, but after analyzing each person's group it became obvious that he was the so-called power-broker). So we decided that he must have had a lot of power. The interesting thing is, shortly after the study, he quit. And then the whole department pretty much fell apart. So so much for that.

The fact was, he was contacted to broker between the two groups continuously, and he couldn't take anymore of it so he quit.

So is it good to be a power-broker, a middleman, a go-between, or whatever you want to call it? The fact is, it gives a sense of power, and so many people assume that's what they want to be, but it may be much better to know someone else in that position, and let them worry about all this, as in:

ME(IN INVESTMENT BANKING) <-----------> MIDDLEMAN <--------------> PERSON IN LAW


Well, in conclusion, I think it can be good to be the middleman when dealing with close friends. When you do favors for close friends there's more of a chance they'll feel indebted towards you, or that they'll find a way of repaying you either way or allow you to benefit from their advantage. With institutional investors, however, it may be better not to be in that position. Say a TASIS grad sees I'm looking for a job and to show how much influence he has he lands me a good job. Chances are I'll send him a nice letter and maybe a bottle of wine, but I probably won't remember much about him 10 or 20 years down the line, when he may be in need.

I guess the secret is to keep close friends as they are, but to take advantage of the fact that others like to show how influential they are by using them as "middlemen". The trick is to find enough of these "middlemen" to have a pretty much exhaustive network, and to play on their egos whenever you need a favor done. Your payoff is the favor, while theirs is an ego-boost, and it seems to me you get the better deal by far.

Since our debate idea worked out so well, and since I update LJ too much, I decided I'll keep the school/thesis related updates on this blog, and the usual crap for crap updates on LJ. No one else is using this, so whatevs.

Anyway, so since there's a risk that I may have to change my thesis to something North Korea related, I have started receving news updates re: North Korea and whatnot. Here are some for today:


Reuters Tue, 01 Nov 2005 8:57 AM PST
Visitors to North Korea's capital, Pyongyang, say traffic pollution is not a
major environmental concern simply because there is hardly any traffic. Fuel is
short and so are vehicles -- whether with four or two wheels.


World Peace Herald Tue, 01 Nov 2005 7:26 AM PST
SEOUL -- Three out of four North Korea defectors living in Seoul say they
witnessed public executions in their communist homeland, according to a recent
survey by South Korea's government-run human rights body.


That's it. I don't really have any comments. They were just interesting.

Mystique

For those who still aren't sure who's taking over the world:

http://www.economist.com/business/displayStory.cfm?story_id=4135286