Senate panel approves website shut-down bill ITWorld
Insurers Test Data Profiles to Identify Risky Clients Wall Street Journal. Consider:
A life insurer might want to scrutinize an applicant who reports no family history of cancer, but indicates online an affinity with a cancer-research group, says Mike Fitzgerald, a Celent senior analyst.
This looks like guilt by association. Join a cancer support group on behalf of a significant other and you get tarred too.
The Story Behind Obama’s Remarks on FDR Tom Ferguson, New Deal 2.0
A Hedge Fund Republic? Nicholas Kristof, New York Times (hat tip reader May S)
Grand Delusions: The Regressive Results of Progressive Markets Chris Floyd
Banks accused of deceiving Nama Irish Times (hat tip reader Swedish Lex)
Caixin Online: China’s inflation data inaccurate MarketWatch. Quelle surprise!
Prime U.S. Mortgage Foreclosures Increase to Record Bloomberg
Bernanke Translated David Wessel, Wall Street Journal
The Most Cost-Effective, Shadow Bailout of Wall Street: $30M Mike Konczal (hat tip Richard Smith)
What happens if Chinese growth slows? Michael Pettis. Persuasive.
Antidote du jour:
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Re the Internet assault bill:
“IP” is one of the most malevolent Trojan horses of the neoliberal assault, one of the most insidious ways the feudalists will try to enforce their calcified oligopolies and bury us alive.
Here’s one example:
http://blog.p2pfoundation.net/3d-printing-intellectual-property-and-the-fight-over-the-next-great-disruptive-technology/2010/11/17
IP, like everything else, is not meant to promote innovation but to strangle it. Just look at the results. There’s no sector where IP law is opening doors rather than shutting them.
Just like with the “Patriot” Act and the “war on terror”, none of which was ever about terrorists but rather about power, so this bill has nothing to do with fostering innovation and protecting real intellectual property (anybody wanna bet on whether it’ll be invoked against the website of a big corporation accused of stealing from a small innovator?), but with imposing censorship on the Internet. It’ll be a bludgeon wielded by a government thug at the direction of his corporate masters.
If we’re going to fight for our freedom and economic self-determination, one prerequisite is that we reject the existing “IP” regime in toto, in principle. There’s no way in which it operates to the benefit of individual and small group creators. It operates completely to the benefit of corporate and government power, against those would-be creators.
(But I suppose here’s yet another issue where there’s lots of identifying-against-one’s-interest nonsense.)
Nick Kristoff actually making _sense_? Who knew that that was even possible?? Maybe he had some lolly in with Madoff that won’t be coming home again. Just a thought . . . .
Furry wide boy: “I was t-h-i-s close to putting it all in with Madoff, when I told myself, no, this just isn’t right. 13.5 a year’s too low, I’m going with Goldman’s hustle. And look at all those stupes over there drinkin’ their own piss now who took the steady money *hah-hah-hah-hah* Trust your gut, is what I say.”
“Senate panel approves website shut-down bill” ITWorld
This website shutdown bill is very disturbing. I can imagine they will be able to shutdown and control just about any website. Looks like the US is taking a page out of Chinas book….
Yep. And the violation don’t ven need to be proven..Only “believed” to be infringing.
Wow..there’s an open door…And another unanamous vote (19-0)..And Mr. Obama decries partisan politics??
Concerning the article on sitting down websites … It’s
concern is toward ‘copyright’ material…which these days are movies, music, and books.
What this means is that everyone should proceed to download their desired Free music, movies, and pornography right now…. Before the Internet police shut it down.
I’m sorry, but that sounds like a politcal talking point form fox or something.
The reality is the government will abuse this law to shut down internet forums that expose all the lies by Monsanto, the centers for disease control, drug companies, and Elites that have been able to keep everybody in the dark until the invention of the internet.
Yeah, I think you’re right. Give this government an inch and it will take a mile. The FBI has already proven it with the patriot act, using their new superpowers to bust people on drug offenses instead.
In a worst case scenario, the nerds will go deeper underground, and will exploit flaws in the system in order to once again get around the law. Look no further than China, which has a army dedicated to censoring the internet currently. All those resources and man power don’t stop everything from getting through, and I really think this government will find magnificent ways of fucking this up if it does prevail. Don’t bet against incompetence.
Re Michael Pettis’s essay — China just announced another hike in reserve requirements. They are trying to engineer that elusive, proverbial dream of central planners — the rarely-observed ‘soft landing.’
I doubt it’s going to work. To the extent that asset prices (such as property) have reached bubble valuations, a hard landing is baked in the cake, regardless of monetary policy.
Sentiment toward emerging markets is super-bullish. It’s like 1997 all over again.
‘Ward, I’m worried about the Beaver. He’s day-trading Chinese internet stocks on his computer. Shouldn’t he be helping Wally with his homework?’
“It’s like 1997 all over again.”
That’s what scares the hell out of me. And what will the US reaction be? In 1997 we had the IMF and others preaching their standard false gospel of austerity, and Rubin pushing the “strong dollar”. Good for finance, but the beginning of the end for manufacturing in this country (that’s when our trade deficit started to soar – what would you expect with all those Asian currencies going into the toilet). The only decent reaction I know of came from Malaysia which, following Krugman’s advice (they hired him as an adviser) instituted capital controls, and hence had a much less worse time than the others.
A more recent example of the bull getting gored is the demise of the Celtic Tiger, but don’t worry, this time it’s different.
‘Ward, I’m worried about the Beaver. He’s day-trading Chinese internet stocks on his computer. Shouldn’t he be helping Wally with his homework?’
“Don’t worry June, the Beav is smart enough to only short them on the basis of inside information. He says if it works he’ll start paying _us_ an allowance.”
Too funny. The beaver. HA hA. It’s the Eddie haskell approach to contemporary finance thAt has taken over the planet like a black plague.
Not 1979.
It’s more like 1949 in a picture taken by Cartier-Bresson in Shanghai during the last days of Kuomingtang, showing people storming a bank for gold – these Chinese capitalists didn’t believe they would be crucified on a cross of gold.
http://www.artknowledgenews.com/2010-04-10-20-46-21-moma-opens-henri-cartier-bresson-the-modern-century-a-retrospective.html
Re: Predictive modeling in underwriting:
Never claim that insurance regulators don’t have a sense of humor. From the NJ commissioner:
“An insurer could contend that a subscription to ‘Hang Gliding Monthly’ is predictive of highly dangerous behavior, but I’m not buying that theory: The consumer may be getting the magazine for the pictures,”
I’m not an economist, so maybe I’m missing something, but what about the Pettis piece is persuasive? It’s one of the weaker arguments of his I’ve read- the entire thing boils down to “well, Japan was ok, so China probably will be, too”. A direct comparison between a developed nation of 300 million people experiencing a slowdown in the boom times of the 90s and a developing nation of 1 billion+ people experiencing a slowdown during the slackest economic times in recent memory seems.. well, fraught? It’s particularly bizarre to me that Pettis would suggest that the Chinese and Japanese reactions to decreasing economic growth would be identical, given how different the social compact in the two countries is, and how different the circumstances are between the two times- I don’t think there was ever a suggestion in the 90s that large swathes of the Japanese population were likely to be subject to food scarcity due to commodity prices, for instance.
Pettis is too close to the scene.
Like a good Chinese landscape painter, you have to see things from a distant perspective.
Yeah, what can one even say to a comment like this? It’s like we’re reading two different articles. What color is the sky in the world you live?
Pettis is not saying that China will be “fine” just because Japan was “fine.” I don’t even know how one could ever get to that idea from the words that Pettis wrote. It seems people have such strong views coming into new thoughts that our limited reading comprehension skills simply cannot overcome them.
Pettis continually talks about the interlocking, interdependent nature of the global economy. In fact, in this article, one could assert that Pettis is merely saying you can’t view a slowdown in China in isolation and imagine this will have a multiplier effect on the rest of the world and lead to global recession; it will have unexpected effects on both China *and* the rest of the world that we cannot predict now. In fact, he explicitly says that a slowdown in China could lead to global self-correcting measures such as increased growth elsewhere.
Pettis knows he doesn’t have all the answers. He’s cautioning everyone to be skeptical that you *know* what the future impact of a slowdown in China will be.
Let me give you a clue. You don’t have all the answers either. It’s going to be ok, nevertheless.
Well, when your argument relies greatly on a particular comparison between two different situations, you must expect the readers to check if said comparison provides sufficiently valid points to strengthen the author’s position.
If the author’s conclusion is like the one you said (“You can’t really predict what’s going to happen, so let’s see before panicking,” which frankly is duh-worthy), much of the Japan-China stuff that he filled a great deal of space with seems a tad pointless, especially since I don’t recall too many people panicking when the Japanese economy started slowing down sharply back then.
Obviously Pettis hedges quite a bit, and I certainly don’t claim to have any answers either (as I say, I’m not an economist), but he’s clearly making the case that the Japanese experience is both a) relevant to the current situation in China and b) indicates that a Chinese slowdown could be less severe both in terms of effects on the global economy and on unrest within the PRC than conventional wisdom would indicate. He specifically says that he disagrees with CW on these two points on the basis of the last two decades in Japan. Yves says this article is “persuasive”- I’m asking how it’s persuasive and how we’re meant to be persuaded?
If the claim is merely “we can’t predict anything that will happen, economies are complex emergent systems and Japan shows that predicting the consequences of economic slowdowns is difficult”, that’s fine, but I still don’t see why anyone would find it “persuasive” of anything. It seems far more illuminating to me to contrast the two situations to look for ways in which they differ than merely to point to Japan and say that conventional wisdom is wrong.
By the way, your tone is patronizing in the extreme. Your glib assertion that “everything is going to be ok” is, frankly, ridiculous- things are already NOT ok for the millions of hungry in China. I don’t know if you’ve spent any time on the mainland, but if you ever care to venture much west of Xi’an you’ll discover a whole world of misery in the PRC which stands to get a hell of a lot worse depending on how things shake out over the next few years.
The Pettis article is a joke.
Literally, it’s 19 paragraphs long and 16 of them, are devoted to Japan. Of the 3 remaining, one is the intro and the other is the conclusion.
All he’s doing is chronicling Japan from the ’90s and using his interpretation as his sole support for his contention that “slowing Chinese growth may not be so bad.”
All Pettis offers is a fallacious “Proof by Example”.
And what is up with the petulant little sign off: “Let me give you a clue. You don’t have all the answers either. It’s going to be ok, nevertheless.”?
All Paper mac did was disagree with the article and point out that there are some important differences between the two countries. Hell, he even began his post with “maybe I’m missing something, but…”
And you hit him with a sniveling “Let me give you a clue. You don’t have all the answers either” blast?
Ridiculous.
“A direct comparison between a developed nation of 300 million people experiencing a slowdown in the boom times of the 90s and a developing nation of 1 billion+ people experiencing a slowdown during the slackest economic times in recent memory seems.. well, fraught?”
Japan’s population was more like 100 million, less than one-tenth of China’s.
That fact alone is too big a parameter for any argument to do without.
“Japan’s population was more like 100 million, less than one-tenth of China’s.”
Quite right, I don’t know why I was thinking 300 million. In any case, a population larger by an order of magnitude, with an entirely different distribution of wealth, few comparable social safety nets, and a much larger ecological footprint, which all seem to be relevant factors.
I don’t see how that issue is germane to Pettis’ article. His point was comparatively simple: everyone assumes if China has a hard landing, it will be a disaster for the global economy because it is large and has made a significant contribution to voverall growth. He argues from the Japan analogy that Japan’s decline in fact has far less of an effect than anyone in 1990 could possibly have envisaged.
Now I can see arguments contra Pettis, the biggest being that we have just been through a global financial crisis, hence any meaningful falloff by China will have a much greater impact.(But we had had a series of financial crises in the early 1990s: the US S&L crisis, plus real estate wipeouts in the Nordic countries, and a very nasty housing recession in the UK).
I’m at a loss to see how your population point fits in, particularly given that China is about to have significant demographic problems as a result of its one-child policy. It appears you disagree with Pettis’ premise, that there could be a hard landing, but the logic of his piece is clearly “if-then” (and he has discussed elsewhere at length why he regards the Chinese growth model as vulnerable).
Your question wasn’t directed to me, but the population issue bears directly on Pettis’ rationale regarding social unrest, as I see it. ~100 million people sharing the wealth of a developed economy relatively equitably are, from what I know about income inequality, far more likely to be able to weather a downturn without significant unrest than are a billion people, a small portion of whom have reaped most of the rewards of the expansion. In other words, I suppose, it’s much easier for a developed economy to cope with the few hundred thousand people who fall through the cracks at the margins during the downturn than it is for a developing economy to deal with potentially tens of millions doing the same. I suppose you could argue that they have less to lose, but I think the scale of the potential problem (in terms of those without work/poor/hungry) in a slowdown is clearly larger relative to the size of the economy in China’s case than in Japan’s.
*oof* There’s a great deal going on in Pettis’ piece, most of which conclusions I agree with if not necessarily for the reason’s advanced. That’s not a criticism of his analysis: this is what working hypotheses look like when one first sketches them out on paper (or pixels). He is making a rather complex interpretation of Japan’s post-bubble experience and comparing that to a highly fluid hypothetical for China’s current variables. There’s bound to be grounds for disagreement, but I certainly think he’s taken a credible go at all the moving parts here.
He points out that Japan’s demand was seriously underwhelming pre-pop, something widely slighted in analysis. Furthermore, his argument that demand may have actually _benefited_ in Japan over the last twenty years, at least on a relative basis, is intriguing and something worth chewing on. As Yves says (if speaking more globally of his piece perhaps), his synthesis on that point is compelling. On the other hand, he completely leaves out _debt_ in that consideration: those same Japanese consumers who are presumably benefitting from the opportunity to consume more are in many cases personally heavily endebted, something which may in effect surpress their demand even below what it was despite nominal gains in their personal economic flows. So his conclusion that Japanese consumers have a net gain post-bubble may not hold well even while his observations about the demand balancing components of this process may be entirely substantive on their own reading. Hmmm.
Salted in the midst of his remarks is an extremely valuable point in my view. Pettis: ” . . . I believe that it is largely demand that powers growth.” I concur, and moreover this point seems often underweighted in consideration of trade flows, to me. We hear endlness, nattering, nonsense in the lickspittle mass media, from many card-carrying economists mind you, regarding how ‘investment’ pushed by capital-wielding ubermenschen ‘creates growth,’ both in developed countries but especialy in developing economies. These developing economies are therefore supposed to ‘open themselves’ to ‘necessary investment.’ But it isn’t speculative exploitation, i.e. ‘investment’ that is needed, but demand, as per the Pettis Principle, and secondarily skilled domestic production for multiplier effects. Any discussion of growth which doesn’t start with demand is already pretty unbalanced in my view. I’m glad to hear Pettis stress this point, and moreover probe it’s implications in the Japanese example.
Regarding the two larger contentions of his piece, I’m uncertain if Japan’s examples is in fact readily transferable to present Chinese experience. Point taken, paper mac, that a developed economy with modest income inequality (plus much consumer debt) is not necessarily a great comparable for a developing economy with acute income distribution skews (but often comparativel slight endebtedness for those at the low end if not at the high end). Pettis certainly seems aware of this from the way he frames his piece. I’ll rephrase a point he makes to that end: all history is local. That is, particular circumstances in particular locales typically have decisive weight in how larger processes are manifestet, or are ‘materialized,’ in those locales. Even if, say, those local conditions are only ‘5%’ of the input array, they may yield a markedly different local outcome. The issue of starved consumer income in Japan pre-1989 for instance is considerably _larger_ than a 5% weight I would say, and so of marked influence in how their bubble played, both up and down.
It’s for this reason, though, the locality of eventuation in larger shared trends, that I find the notion of ‘global growth,’ well, bizarre. One simply can’t consider something like growth as an aggregate quality, and analyses on such bases strike me as bootless. —Yet such analyses are pervasive in contemporary economic practice, even as a backcloth to Pettis’ arguments in which he explicitly recognizes the weaknesess of such a notion. . . . We need a new language in economics. Or to rediscover an old one. Because the language economics speaks as of 2010 is stoooopid.
Returning to those to contentions which Pettis does a swing-by on, I find the case for ‘riots in China imminent’ to be particularly unpersuasive and unevidenced. This is wish-fulfillment by others elsewhere in my view not sourced int he cultural conditions or facts on the ground there. I can think of my objections to the meme, but I’m going to skip that this particular hour.
The other idea, that ‘slowdown in Chinese growth will . . . ,’—let’s slam on the brakes there. This is a hypothetical, and there is significant evidence that there is _no slowdown in Chinese growth_. We hear this year of hiring shortages, etc., etc. etc. A slowdown is something projected, not something evidenced. And the entire idea of an imminent slowdown is contestible. This has been mooted here on NC in different times and forms, and I’m not necessarily tossing the subject out on the floor, only raising an objection to sweeping on to discussion _how_ such a slowdown would/might play since it’s far from assured that we will see one in the near term. Much of the contention of slowdown rests on “their surplus must/will decline” kinds of arguments. (Although the demographic issues Yves raises are of separate and significant relevance at least. If of uncertain result: what if their primary result is to _force up wages_ for the smaller workforce, resulting in a demand boost? That outcome has been demonstrated historically, with an interesting comparable being the great rise in Late Medieval incomes from the population declines of the Black Death. It’s arguable that the Renaissance was a direct result of this. I’m just sayin’ . . . .)
The link between a trade surplus decline and a growth decline is presumed solid, but it’s bogus. Export trade is 15% of Chinese GDP, and not inconsiderable figure, but nothing like the 85% which is domestic. And it is domestic growth which not only has the greatest potential to expand, and further to expand _domestic demand_ (that again) but which is giving some hints of reaching the takeoff point. Although a bubble blow-down in China could certainly put a damper on that, which is why some who seem pre-sold on ‘the inevitablity of stagnagion in China’ have loudly been proclaiming bubbles in China capable of such result, something at least problematic to either discern or interpret. Then there’s the issue that the Chinese trade surplus occurs in relation to multiple _but disparate_ partners. With the US, one may presume that that surplus will decline, at least relatively, if only from demand declines in the endebted and economically incontinent US. With the EU, such an outcome is far from clear or certain. With their bilateral developing partners in Latin America, Africa, SE Asia, and Russia, Chinese trade does not seem likely to experience a marked collapse; far more likely an exponential expansion. This makes readings of ‘the decline in China’s trade surplus’ highly questionable, since the conditions of such arguments strike me as invariably overweighted toward trade with developed countries plus afflicted by assumptions that trade flows with developed countries are all alike: they are not.
The short of the long of it is that, as I said, I concurr with Pettis’ circumspection on these points but from rather a different position. But at least he’s thinking his own arguments most of the way through. That’s more than can be said for many.
Yumpin’ Yemeni… that’s some financial innovation! Kinda like anti-pirates :)
Although it appears the US gov and other’s aren’t too pleased with it…
The Privateers of Yemen http://www.foreignpolicy.com/articles/2010/11/16/the_privateers_of_yemen?page=full
Yemen’s leaders are pushing the United States to increase its military aid roughly 40-fold for their country to fight al Qaeda — but Yemen isn’t just relying on aid to generate cash from the international security threats burgeoning on its lands and seas.
For more than a year, Yemen’s financially pragmatic civilian and military officials have been contracting with at least one maritime-security broker to hire out commissioned Yemeni warships and active-duty and armed Yemeni coast guard and navy sailors as private escorts for merchant ships and oil tankers crossing the pirate-infested Gulf of Aden. The cost for Yemen’s escort service: up to $55,000 per ship, per trip.
Guaranteeing “the ultimate protection for your vessel and crew,” the website of Gulf of Aden Group Transits, Yemen’s London-based broker, offers shippers “a dedicated escort by a heavily armored 37.5 meter Yemen Navy Austal patrol boat” and ”six serving Yemen military or coast guard personnel to embark and protect your vessel.”
The fee apparently also guarantees shippers a degree of immunity regarding any ensuing battles at sea: “Any action taken by the teams or vessels provided … is fully authorized by the Yemeni Government,” says the website of Lotus Maritime Security, the Yemeni company that claims to serve as a liaison between the London-based broker, the Yemeni government and military, and shippers.
The broker’s website offers testimonials from satisfied sea captains.
In defense of the IMF, I can recall looking back at their 2003 World Ecomonic Outlook (in 2005) and finding its discussion of bubbles rather prescient.
http://www.imf.org/external/pubs/ft/weo/2003/01/
(Scroll down to Part II)
Grand Delusions: The Regressive Results of Progressive Markets Chris Floyd
“You cannot fruitfully address social problems with a mechanism designed to create private profit — just as you cannot build a peaceful, stable society with an organization designed to kill people and blow things up. Yet multitudes are suffering and dying all over the world from these delusions. And because they augment the wealth and dominance of the powerful, these corrosive myths will continue to be propagated with evangelical fervor by those same elites and their sycophants — to the detriment of social needs, of national security, of the common good and the daily lives of countless individuals.”
Regarding the Chinese slowdown, I’m not so sure that you can compare the Japanese situation to the Chinese one the way the article does. Politically and structurally, there is very little in common between the two. When the Japanese bubble burst, the country had already had decades of steady growth that created the broad middle class, similar to the American post-war middle class. It was already a highly advanced and egalitarian society with most of the population well-educated, on top of being homogeneous and thus tight-knit. And they had the luxury of minding their own business under the umbrella of the US military due to the treaty.
On the other hand, China is a de facto empire, many parts of which are still decidedly “third-world”. It doesn’t even remotely have the political stability that Japan had in early 90s, and the resource and power required to deal with the internal problems would be enormous. They can’t just mind their own business either.
I don’t think you can discuss it only from the macroeconomic point of view like that. Those two countries are just too different. I think the article omits too much for its argument to be much more than a casual food for thoughts.
Per wiki, in the US:
“Works created in or after 1978 are extended copyright protection for a term defined in 17 U.S.C. § 302. With the passage of the Sonny Bono Copyright Term Extension Act, these works are granted copyright protection for a term ending 70 years after the death of the author. If the work was a work for hire (e.g., those created by a corporation) then copyright persists for 120 years after creation or 95 years after publication, whichever is shorter.”
“Works published or registered before 1978 currently have a maximum copyright duration of 95 years from the date of publication, if copyright was renewed during the 28th year following publication (such renewal was made automatic by the Copyright Renewal Act of 1992; prior to this the copyright would expire after 28 years if not renewed). The date of death of the author is not a factor in the copyright term of such works”
70 years, 95 years, 120 years? This is just a scam for corporations to extract rents on material essentially forever. It is not about content creators and the companies that contract with them receiving a fair return on their investment. It is about government safeguarding their rents (and in the case of their creators far beyond their own lifetimes). And it allows corporations, private individuals, and their estates to tie up huge swathes of material for no other reason than that they can. We should go back to a system of 35 years from publication or creation, period. If corporations and individuals can’t get a reasonable return in that length of time, they don’t deserve one.
Just FYI, as a follow-up to the item on the COICA copyright bill — Sen. Ron Wyden is looking to block it, which may kill it for this year:
http://www.itworld.com/internet/128312/senator-threatens-block-online-copyright-bill