Monday, February 29, 2016

My favorite disco song ever:

RIP Arthur. You were one of the greats. I listen to your music at least once a week.

Thursday, February 25, 2016

Why I am on Facebook

Sure the cat vs. cucumber videos are awesome, but check out my Facebook feed this morning.

Epic and wonderful. Thanks Dan and Jason (and WW too!).

Tuesday, February 23, 2016

That's a lovely biscuit, gov'ner

OMG. The biscuit people are running out of bloody biscuits.

If you don't believe me, check out this apocalyptic headline from Leister:

Britain facing disastrous biscuit shortage

(Pro-tip: In England, biscuits are basically shitty cookies).

The article claims the shortage is coming from a flood last year that closed down United Biscuit!

Which is awesome, but doesn't really explain anything.

Was there a biscuit monopoly in the UK?

Has Big Biscuit blocked the importation of foreign biscuits (let them eat Oreos!!)?

Has Big Biscuit's biscuit advertising been so powerful that the English are brainwashed into only eating United Biscuit biscuits?

Has the British biscuit regulator stepped in and imposed biscuit price controls so the biscuit market is no longer clearing?

I guess the only thing we know for sure is that it's sticky wickets for lovely biscuits in Albion!

Friday, February 19, 2016

Pots, Kettles, & Unicorns

People this is awesome. 4 former CEA chairs have written a letter lambasting Bernie Sanders (and all Republicans ever) for their pie in the sky policy projections.

The letter includes the phrase: "the Democratic party has rightfully earned a reputation for responsibly estimating the effects of economic policies."

Gee, guys. Hope you didn't hurt your shoulders patting yourselves on the back so heartily.

So I know what you are thinking, wow, good thing Christina Romer wasn't one of the people who signed the letter.


Oh no she didn't!

Oh yes she did!

Here is an example of Prof. C. Romer's responsible estimation of the effects of economic policies.

Meanwhile, Paul Krugman is attacking Bernie and promoting Hillary based on the notion that Hillary's unicorns are less unrealistic than Bernie's unicorns.  For Realz!

It's Mungo's world now. We are just living in it and giving thanks.

Thursday, February 18, 2016

Can This Be True?

A quiz:  Is the following letter real, or is it a fictional mock-up based on Ayn Rand's ATLAS SHRUGGED?

Dear [pobrecito chingado]

I am writing to request that your company voluntarily divest from any investments it may have in thermal coal. 

Specifically, I am asking that you refrain from making any new investments, refrain from renewing any existing investments, and to sell or withdraw from existing investments, in any company that generates thirty-percent or more of its revenue from the mining or use of thermal coal. 

 My decision to ask you to divest from thermal coal arises from my statutory responsibility to make sure that insurance companies address potential financial risks in the reserves they hold to pay future claims. As utilities decrease their use of coal and other carbon fuel sources, as states like California limit the ability of the private sector to use burn coal and other carbon fuels for power generation and require their pension funds to divest from coal, as states like California and the United States impose more stringent air quality requirements which limit the ability to burn coal and other carbon fuels, and as nations across the world begin to implement the commitments they made to reduce their use of carbon at the recent United Nations COP21 Climate Summit in Paris, investments in coal and the carbon economy run the risk of becoming a "stranded asset" of diminishing value. 

The movement away from coal and the rest of the carbon economy poses a potential financial risk to insurance companies investing in coal and the carbon economy. The potential risk of continuing such investments is that they lose value over time or that they lose value quickly. In either case, such investments pose a potential financial risk to those who invest in them. At some point nations and states may dramatically restrict the burning of carbon. At that point, investments in coal mines, in oil and gas wells, in companies that extract coal, oil or natural gas, in companies that transport coal, oil and gas, in utilities that rely on coal, oil or gas, among others, could drop dramatically in value. 

Before that happens it is important for insurance companies and insurance regulators to understand the scope of these investments by insurance companies and to take steps to mitigate potential financial risks. Divestment from thermal coal in particular will help protect insurance companies from holding an investment currently dropping in value, and which is likely to suffer substantial additional decline in value during a transition to a reduced carbon economy, and run the risk of becoming a "stranded asset." California is decarbonizing its economy and transitioning to clean, pollution free energy resources. Utilities have been required by law to dramatically reduce their reliance on carbon. California's cap and trade program also results in raising the cost of carbon and reducing its use. Two of the world's largest pension funds - CalSTRS and CalPERS - have been required by the state legislature to divest their thermal coal investments by July 2017. 

A number of insurance companies have already recognized the risks of continued investment in thermal coal. Allianz announced that it would decrease investments in companies using coal and boost funding in those focused on wind power. Similarly, Axa announced last year that it will remove from its portfolio, and refrain from future investment in, companies that derive more than half of their income from coal mining, including electrical utilities that derive more than half of their energy from thermal coal plants. I appreciate your consideration of my request that you, and all insurance companies licensed to write insurance in California, divest from thermal coal investments. 

Your response to this request would be appreciated by February, 24, 2016. Please respond by email or letter to me, sent to Shannon Heinzer at to indicate whether you will be complying with my request. The Department of Insurance will make public the names of those companies who commit to voluntarily divest from thermal coal and those which do not. I recognize that it may be challenging to immediately eliminate all of your existing thermal coal investments, but I strongly encourage you to make a commitment to move in this direction. If you have any questions about this request, please contact my Deputy Commissioner & Special Counsel, Geoffrey Margolis, at 300 Capitol Mall, 17th Floor, Sacramento, CA 95814, (916) 492-3574. 

Sincerely, DAVE JONES Insurance Commissioner 

Nope, wrong.  It's a real letter.  Wow.  A requirement that they "voluntarily" divest.  Orwell is smiling grimly, somewhere.

Sunday, February 14, 2016

Phone Call for Senate GOP: Bad Deal May Be Better Than No Deal. Or, Not.

Agreement Attraction and Impasse Aversion: Reasons for Selecting a Poor Deal Over No Deal at All

Ece Tuncel et al.
Psychological Science, forthcoming

Abstract: In the present studies, we examined the positive value of agreement and the negative value of impasse. Participants chose to give up real value and sacrifice economic efficiency in order to attain an agreement outcome and avoid an impasse outcome. A personally disadvantageous option was selected significantly more often when it was labeled "Agreement" rather than "Option A," and a personally advantageous option was avoided significantly more often when it was labeled "Impasse" rather than "Option B." In a face-to-face negotiation, a substantial proportion of individuals reached an agreement that was inferior to their best alternative to agreement. We showed that the appeal of agreement and the aversion to impasse both contribute to this effect, yet the aversion to impasse is the stronger of the two motivations. These findings have important implications for negotiators.

Wednesday, February 10, 2016

Economists endorse Unicorn World Bank

Two of my favorite Michaels (right behind Mungo of course!), Clemens and Kremer, have a new paper arguing that even though the access to financing mission of the World Bank is no longer relevant, we still need it for poverty reduction and knowledge dissemination.

There's just two problems with that viewpoint.

1. Most of the global poverty reduction we've seen has come from the simple adoption of capitalism (China and others), not World Bank projects or initiatives. And, in my view, the Bank is more anti-capitalism now that it has ever been.

2. The World Bank's "knowledge" has been consistently off base for at least the past 50 years.  We've gone from the financing gap to education to institutions to you name it. Countries have spent real scarce resources following the advice and by and large it hasn't worked. Take the great universal primary enrollment goal (please). Whoever would have thought that governments would end up creating Potemkin schools where learning is often absent.

Phone call for Bill Easterly. Paging Lant Pritchett!

Even old, bad, discredited advice never seems to die out at the Bank as evidenced by this tweet:

Note the date. 2016!! Not 1955. Apparently the Harrod-Domar model and the financing gap still live in the executive suites of the bank.

The tweeter is Vice President for Equitable Growth, Finance and Institutions at the Bank.

Now Clemens and Kremer are both way smarter and more successful than me. I had been thinking about a post like this but only decided to write it after seeing that incredible tweet this morning.

But Clemens and Kremer are committing the Mungowitz Unicorn fallacy.

They are conjuring up an idealized World Bank that has never existed and claiming we still need that unicorn Bank, rather than evaluating the desirability of the World Bank we actual have.

If we think about the actual World Bank, it's not so obvious that the cost-benefit calculation comes out positive.


It appears I am hypothyroid, in terms of blood tests for TSH.

The doctor prescribed the (common) drug Levothyroxine.

There are many possible side effects.  But two of the more prominently mentioned are:
  • Change of consciousness
  • False or unusual sense of well-being 
I don't want to reveal anything embarrassing.  But Angus and I really could have used some of this stuff in 1981.  Because what we were using to change our consciousness and produce a false or unusual sense of well-being was more expensive and harder to get.

Hard to imagine going to the doctor and complaining, if that is the profile of side-effects to expect...

Tuesday, February 09, 2016

Florida Man

If the headline starts with "Florida Man," even after a colon, it's going to be good.

Assault With a Deadly Weapon: Florida Man Charged with Trowing Live Alligator into Wendys

Pure gold:

The driver, wearing a backwards baseball hat, arrived at the drive-through window to receive a large drink just before 1:30 a.m. on Oct. 11, according to the report’s summary of surveillance footage.

“While the attendant has her back to the window and is at her register, the male driver reaches across the inside of his vehicle in the passenger area and throws an alligator from his vehicle into the drive through window,” the report reads.  
"Wearing a backwards baseball hat."  The redneck version of "He was wearing a hoodie."

If you like "Florida Man," well, then....

Monday, February 08, 2016

Don't Stand, Don't Stand So Close to Me

Where does one stand: A biological account of preferred interpersonal distance 

 Anat Perry, Nikolay Nichiporuk & Robert Knight
Social Cognitive and Affective Neuroscience,
February 2016, Pages 317-326

Abstract: What determines how close you choose to stand to someone? Why do some people prefer farther distances than others? We hypothesized that an important factor is one’s sensory sensitivity level, i.e. how sensitive one is to nearby visual stimulation, noise, touch or smell. This study characterizes the behavioral, hormonal and electrophysiological metrics of interpersonal distance (IPD) preferences in relation to levels of sensory sensitivity. Using both an ecologically realistic task and electroencephalogram (EEG), we found that sensory sensitivity levels predicted IPD preferences, such that the more sensitive one is the farther distance they prefer. Furthermore, electrophysiological evidence revealed that individuals with higher sensory sensitivity show more alpha suppression for approaching stimuli, strengthening the notion that early sensory cortical excitability is involved in one’s social decision of how close to stand to another. The results provide evidence that a core human metric of social interaction is influenced by individual levels of sensory sensitivity.

Saturday, February 06, 2016

Kanamara Matsuri

I had not heard of the Kanamara Maturi festival in Kawasaki, Japan.

But now I have.  The Wikipedia page tells you at least as much as, and possibly more than, you wanted to know.

Some things do occur to me (having listened to Ellen's description).

1.  This is a festival that Tommy the Tenured Brit could really get behind.  Or, in front of.  As it were.
2.  If the parade lasts more than four hours, do they need to call a physician?
3.  What if it sees its shadow?
4.   But mostly, WTF?  As Wikipedia notes, the festival started out quite small, but it "keeps getting bigger and bigger."  Wikipedia, folks, for the win.