Quote of the Week (Outsourcing edition)

My efforts to slowly work down my backlog of drafts in the queue continues with your Quote of the Week. Yes, this article is a few weeks old, but that doesn't make it any more awesome. Kudos to this guy, slow claps all around.

This week's QUOTE OF THE WEEK

"A security audit of a US critical infrastructure company last year revealed that its star developer had outsourced his own job to a Chinese subcontractor and was spending all his work time playing around on the internet. The firm's telecommunications supplier Verizon was called in after the company set up a basic VPN system with two-factor authentication so staff could work at home. The VPN traffic logs showed a regular series of logins to the company's main server from Shenyang, China, using the credentials of the firm's top programmer, 'Bob'... 

After getting permission to study Bob's computer habits, Verizon investigators found that he had hired a software consultancy in Shenyang to do his programming work for him, and had FedExed them his two-factor authentication token so they could log into his account. He was paying them a fifth of his six-figure salary to do the work and spent the rest of his time on other activities."
                                                          - Iain Thompson, The Register

That is awesome. I can't exactly blame the company for letting Bob go, especially since he exposed the fact that he was apparently being overpaid by a factor of five. But if a company can outsource a job to China, why can't the employee do it himself? That's the kind of creativity this country needs! Bravo, Bob.

 [The Register]

Quote of the Week (Czech edition)

A few weeks back, I wrote a post about how I was still proud to be an American, because the beer is cheap and plentiful. That is still a glorious fact. Nevertheless, I am at least considering the alternative of moving to Prague, where the median income may be lower, but the beer prices are too. Diving right in...

This week's QUOTE OF THE WEEK

"At a typical local pub, a pint—500 milliliters, actually, in this metric-measuring country—costs about $1. A similar portion of water, juice or soda generally costs twice as much. Offering free tap water as at U.S. eateries is extremely rare. At U Zelenku, a neighborhood institution for more than a century, for instance, a pint of the cheapest beer goes for 99 cents. The same size of soda water is $1.30. At the fancier Kolkovna restaurant in touristy Old Town, a pint is $2.50, while mineral water is $2.29, for a bottle less than half the size."
                                      - Sean Carney; Wall Street Journal

This dynamic isn't exactly new to me, as I experienced a similar economic curiosity in my trip to Italy a couple of years ago—the house wine carafes (vino della casa) sold for prices around €3.50 (about $5) for a half-liter. That's not quite cheaper than water, but it was certainly in the same ballpark as the soft drinks at many restaurants. Wine for lunch, it is, then...

Of course, there's always a risk to looking only at the price of one product and trying to determine anything meaningful about the overall state of the economy. Beer prices alone are meaningless, for example, without also knowing what typical food prices might be—it could be that in Prague, general business practice is to slash the prices of booze, and to attempt to make the money on the food instead (as I've previously argued, the opposite seems to be the case in many U.S. restaurants). Or there may be dozens of other factors at play, all of which help drive down the cost of beer in restaurants.

Either way, who wants to go on a Czech pub crawl with me? First pilsner is on me.

[Wall Street Journal]
(h/t Tyler Cowen)

Quote of the Week (Japan Edition)

I wanted to pull this week's Quote of the Week from Arnold Schwarzenegger's Q&A on Reddit last week, I really, really did. The concept of 1,000 duck-sized Predators is just too great to not mention, and I couldn't get that mental image out of my head all week. Brilliant stuff.

But I decided instead to give the honor to Japan's new Finance Minister (their 11th since 2007!) Taro Aso, whose brutal bout of honesty this week added a neat little twist onto Japan's growing fiscal problems (and demographic nightmare). In a statement that is almost certainly intended directly for the ears of Jiroemon Kimura, the oldest man in recorded history, Aso uttered a phrase (well, a few of them, really) that you might end up hearing a lot of around the world over the coming decades...

This week's QUOTE OF THE WEEK

"Taro Aso said on Monday that the elderly should be allowed to 'hurry up and die' to relieve pressure on the state to pay for their medical care.

'Heaven forbid if you are forced to live on when you want to die. I would wake up feeling increasingly bad knowing that [treatment] was all being paid for by the government,' he said during a meeting of the national council on social security reforms. 'The problem won't be solved unless you let them hurry up and die.'

Aso's comments are likely to cause offence in Japan, where almost a quarter of the 128 million population is aged over 60. The proportion is forecast to rise to 40% over the next 50 years.

To compound the insult, he referred to elderly patients who are no longer able to feed themselves as 'tube people'. The health and welfare ministry, he added, was 'well aware that it costs several tens of millions of yen' a month to treat a single patient in the final stages of life."
                                                     - Justin McCurry; Guardian

So, first of all, it needs to be said that this dude is completely off his rocker. If you read Mish Shedlock's whole piece, you'll see that Aso has previously made bizarre off-color remarks about Jews, Taiwanese, and blue-eyed U.S. diplomats, so clearly he has a habit of saying outlandish things to provoke a reaction (sort of like another economist we all know and love).

That said, this little moment of honesty might hit just a little close to home for all of us here in America. Our Medicare costs are already projected to go through the roof over the coming decades, in large part because we continue to refuse to have difficult conversations about end-of-life care (specifically, how much is it worth to keep somebody alive for an extra year at age 65, versus at age 75, versus at age 85? Is there an infinite value? A declining value? Do we even begin to know?).

We can choose to spend an infinite amount of money to keep a person (any person) alive for another day, and hospitals and doctors will surely be glad to dispense those services as long as somebody (i.e. the taxpayer) is willing to pay. But sooner or later, we simply can't afford to do so for everybody, and we have to have that difficult little conversation with each other. Japan is having it now; it's coming our way sooner than you might think.

[Mish Shedlock]

Quote of the Week

We had two solid contenders for this week's Quote of the Week crown, one of whom is a familiar face around these parts. In an epic rant about the ludicrous trillion-dollar platinum coin proposal that inexplicably gained traction last week before quickly being shot down (but not before turning our political and economic discourse into a Simpsons-esque farce), Stephen Colbert delivered a classic line about the recently re-elected President Obama, saying, "we should have known a coin was Obama's solution to everything—it was right there in his slogan... CHANGE!"

The whole clip is worth a watch, if only because Colbert does an excellent job of breaking down the whole it's-legal-because-it's-not-technically-illegal basis upon which the entire proposal relied, which is interestingly pretty much the same basis upon which Obamacare was upheld by the Supreme Court this summer. Nevertheless, this week's Quote of the Week is going to come from a totally different source, although also technically a familiar "face" around here.

A couple of years ago, an IBM supercomputer named Watson made waves when he (it?) beat two great Jeopardy! champions in an exhibition match, in the process demonstrating the potential for computing in the next generation. The IBM team has continued to fiddle with Watson, hoping to refine the computer's ability to comprehend human language (and to minimize some of the memorable gaffes that he made on the show). Part of that tinkering process involved incorporating slang into Watson's vocabulary, which... well, let's just let Fortune's Michael Lev-Ram tell the rest of the story.

This week's QUOTE OF THE WEEK

"[IBM research scientist Eric] Brown attempted to teach Watson the Urban Dictionary. The popular website contains definitions for terms ranging from Internet abbreviations like OMG, short for "Oh, my God," to slang such as "hot mess." But Watson couldn't distinguish between polite language and profanity—which the Urban Dictionary is full of. Watson picked up some bad habits from reading Wikipedia as well. In tests it even used the word "bullshit" in an answer to a researcher's query. Ultimately, Brown's 35-person team developed a filter to keep Watson from swearing and scraped the Urban Dictionary from its memory. But the trial proves just how thorny it will be to get artificial intelligence to communicate naturally."
                                                - Michael Lev-Ram, Fortune

Too funny. I can't get the concept of a foul-mouthed robot spewing insults at everyone out of my head. In fact, it makes me want to build a Watson for myself and program him only with things he picked up from Urban Dictionary. But I digress.

I still think that the potential for artificial intelligence is incredibly high, but this speaks volumes about how weird and nuanced human thought and communication can be, and therefore how difficult it can be to replicate. Given how frequently public figures put their feet in their mouths with episodes of careless and thoughtless speech, I can only imagine how bad things might be for a computer that hasn't been programmed to understand the subtleties of (and contradictions in) modern language.

[Fortune]

Quote of the Week

We had two very serious contenders for Quote of the Week this week, and both of them are going to get a little bit of love here. The first one comes from Brazil, where a cat was caught trying to wriggle through prison gates while carrying a cell phone, drills, an earphone, batteries, and a phone charger. When discussing the case, prison guards shared that it was tough to get the cat to sell out his accomplices, because he wasn't talking. Shocking. Note to self: teach cat how to commit petty crimes.

But this week's winner comes from the great state of California, where a man is seemingly determined to prove that corporations are not, in fact, people (contrary to the beliefs of a certain electoral runner-up). From NBC News, it's your Quote of the Week.

This week's QUOTE OF THE WEEK

"When Jonathan Frieman of San Rafael, Calif., was pulled over for driving alone in the carpool lane, he argued to the officer that, actually, he did have a passenger. He waved his corporation papers at the officer, saying that corporations are people under California law... Frieman doesn't actually support this notion. For more than 10 years, Frieman says he had been trying to get pulled over to get ticketed and to take his argument to court—to challenge a judge to determine that corporations and people are not the same." 
                                                    - NBC News

At the heart of the issue is the Supreme Court's controversial 2010 decision in the "Citizens United" case, which essentially brought the issue of corporate personhood into the public eye and made it a hot-button political issue. It's still unclear exactly where the concept of corporation-as-person begins and ends, and this latest incident is clearly part of the process of drawing out those lines in the sand.

Unfortunately (and somewhat unsurprisingly), it doesn't look like Mr. Frieman's case is going anywhere. A judge has already ruled against him, and although an appeal is planned, it's unlikely to gain any traction. Nevertheless, kudos to the man for coming up with a creative way to draw attention to an issue that likely won't be going away any time soon. As far as Quotes of the Week go, this one is among my favorites.

[NBC News]

Quote of the Week (Fiscal Cliff edition)

I don't have a lot to say about the recent "resolution" to the fiscal cliff, largely because it resolved nothing and is, once again, merely a prelude to the next "fiscal crisis" that is mere weeks away. However, I thought that Tyler Cowen of the Marginal Revolution blog shared the most succinct (and sobering) summary of the entire fiscal cliff experience. From New York Times columnist Ross Douthat, it's your Quote of the Week.

This week's QUOTE OF THE WEEK

"If a newly re-elected Democratic president can’t muster the political will and capital required to do something as straightforward and relatively popular as raising taxes on the tiny fraction Americans making over $250,000 when those same taxes are scheduled to go up already, then how can Democrats ever expect to push taxes upward to levels that would make our existing public progams sustainable for the long run?"
                                                     - Ross Douthat, New York Times

Indeed. Which of course just shows us that there is, ultimately, zero political will to address the problems about which I've spilled so much ink (okay, pixels) on this blog. If we can't raise revenue, then we can't fund programs, period, end of story. It's just a matter of when we choose to recognize this fact (or when the markets decide to recognize it for us, as is usually the reality when it happens elsewhere, and is almost assured given that politicians are already setting up to capitulate on the next crisis).

All of this means that charts like this one aren't likely to change any time soon, regardless of what some people might want to tell you:

Source: Bianco Research via Barry Ritholtz

But hey, at least the markets liked the deal, that must be good news, right? Uh, maybe. Or maybe this thing was just like every other piece of legislation out of Washington lately—hastily thrown together, not well-understood even by those who voted on it because they didn't bother to read it, and loaded up with all sorts of kickbacks and favors to the corporate elite that don't belong in there to begin with.

Business as usual in Washington, right? Good grief.

[New York Times]
(h/t Marginal Revolution)

Quote of the Week (Sexual Harassment Edition)

This week's Quote of the Week is presented here without comment, lest I say something that offends women, seeing as I live in a house with two of them (one big, one small). I'll just let this one speak for itself.

This week's QUOTE OF THE WEEK

"The Iowa Supreme Court says a dentist did not commit sex discrimination when he fired an attractive female assistant he viewed as a threat to his marriage. The court ruled Friday that a boss can fire an employee he considers an 'irresistible attraction,' even if the employee has done nothing wrong. The decision is the first in Iowa, but in line with rulings elsewhere. Justices rejected a discrimination lawsuit filed by Melissa Nelson, who was fired by Fort Dodge dentist James Knight in 2010."
                                                 - Quad-City Times, via Associated Press

Okay, fine, I'll comment, but just for a second. For what it's worth, as a general rule, I think that people should be able to be fired for just about any reason, just because I think it's silly that nobody really has to provide reasons why they didn't hire anybody in the first place, but then they are expected to provide well-documented reasons why they did fire somebody, just because they made the initial decision to hire them.

It's basically your typical act of omission versus act of commission scenario, and I typically think that such distinctions have a tendency to become arbitrary and stupid. If we place restrictions on firing, then all we're really doing is making it less likely that anybody would ever want to hire anybody in the first place. And that's a lesson that France seems intent on learning the hard way. Let's not be like France, mkay?

Anyway, the dentist in question in this case is definitely a moron, and he is almost certainly guilty of sexual harassment and deserving of some type of punishment—via karma if not via the court system. However, in my semi-libertarian opinion, there is no reason that we need to place restrictions on discretionary hiring and firing decisions simply because of this guy's moron-itude. Being a moron (or a scumbag) is not, in general, an act that must be punishable under the law—I'll leave that punishment to the dentist's wife, who I'm quite certain is up to the task.

As for Ms. Nelson, why exactly would somebody want to work in an environment with a creepy-ass dentist who makes off-color sexual remarks in the first place? Her dismissal is probably for the best for just about everyone involved here, in my humble opinion. But hey, maybe I should've just not commented on this one, after all...

[Quad-City Times]

Quote of the Week

Every once in a while, I like to mess around a little bit with Quote of the Week and give the honor to a cartoon, like this awesome Dilbert comic strip, or this nerdy statistics humor cartoon. This is one of those weeks, because I feel like we could all use a little levity around here, given all the talk about guns and fiscal cliffs and of course the looming apocalypse.

On that last point, here's your Quote of the Week, courtesy once again of my man Killagroove.

This week's QUOTE OF THE WEEK

Quote of the Week

I'm going to keep things quick and simple with this week's Quote of the Week, because I think it largely speaks for itself. Let's get right to it, with blogger Karl Denninger's response to the recent revelation that over 47 million Americans (about 15% of the total population) are now receiving food stamps. That's an increase of nearly 50% just since 2009, which is costing our government an additional $25 billion annually. Yuck.

This week's QUOTE OF THE WEEK

"The last month for which data is available, September, shows over 600,000 people [began collecting food stamps] in that month alone, comprised of 290,000 households. In one month! The average handout is $278.89 per household, or $134.29 per person monthly. Note that there are only 143,549,000 people in the workforce -- that is, people earning a wage... To put this in perspective for every three people working one is collecting food stamps."
                                     - Karl Denninger, The Market Ticker

That is awful. Setting political issues of the "fiscal cliff" or the "welfare state" or whatever else aside, the simple fact is that this is a completely untenable economic situation. Far too many people are currently receiving food stamps, and this alone is a huge indication that our policy responses to the financial crisis of 2008-09 (deficit spending, Fed money-printing) have been an utter failure.

The debt-based financial games that we've played for the last several decades have gutted our nation's middle class (death by several trillion paper cuts), and yet many would suggest that more of the same is what we need to solve our problems. Believe me, they're wrong.

It is imperative that we stop lying to ourselves and pretending that these policies work. They don't. We need to clean up our fiscal house (starting with defense and Medicare), take the power away from the banks who continue to steal from the rest of society, and most importantly stop printing money. It won't be fun, and it won't be easy, but it really is the only option—things will only be worse in the future if we fail to act today. America is a country that has always strived for greatness, and 15% of the population on food stamps falls far short of "great".

[Market Ticker]

Quote of the Week (Fertility Edition)

I definitely had at least half a mind to give this week's Quote of the Week to Chiefs quarterback Brady Quinn, who did an admirable job of distilling a horrific incident down to a useful message (without preaching or being trite or condescending, like some people). It's rare that you see an athlete being so frank and dropping their guard like Quinn did (it happened around five minutes into the press conference, which started out pretty slowly), and I salute him for it.

As he mused, "when you ask someone how they're doing, do you really mean it... and when you answer someone back, are you really telling them the truth?" I think Quinn is right to decry the shallowness of many (or most) interpersonal relationships in our social media-driven era, and his words can definitely give us all some food for thought.

But I came across another excerpt yesterday that was even more academically intriguing, if somewhat less poignant and powerful. Courtesy of Marginal Revolution's Tyler Cowen, and echoing some of the comments I made in this blog post last week, I give you the New York Times' Ross Douthat, who discusses the reasons for and potential impact of America's plummeting fertility rate:

This week's QUOTE OF THE WEEK

"There’s been a broader cultural shift away from a child-centric understanding of romance and marriage. In 1990, 65 percent of Americans told Pew that children were “very important” to a successful marriage; in 2007, just before the current baby bust, only 41 percent agreed... The retreat from child rearing is, at some level, a symptom of late-modern exhaustion — a decadence that first arose in the West but now haunts rich societies around the globe. It’s a spirit that privileges the present over the future, chooses stagnation over innovation, prefers what already exists over what might be. It embraces the comforts and pleasures of modernity, while shrugging off the basic sacrifices that built our civilization in the first place."
                                            - Ross Douthat, New York Times

I think there's a lot of merit to Douthat's take on the matter. The decision to eschew having children is, in a sense, the pinnacle of short-term thinking (a dynamic which has clearly taken on a life of its own in recent generations). If we all made the decision to have no children, our society would (theoretically, anyway) disappear in a matter of decades. None of us would be here but for someone else's decision to procreate, and yet there is often no recognition of that fact when it comes time for us to make a similar decision.

The decision is, in fact, the ultimate indulgence of a rich and stagnant society, one that is made all the more possible and plausible by the emergence and standardization of birth control, the access to which the UN has bizarrely ruled a universal human right.

To be fair, for many people in my generation, the decision not to have children has been a direct by-product of the explosion of debt (student loans and other types) in recent decades, and in that respect it's a perfectly rational—yet still sub-optimal—decision. If you can't afford to have kids (or don't feel like you can), then you clearly shouldn't, lest those children be deprived or resented by their own parents.

Nevertheless, it's an interesting thought experiment to wonder what would happen if only the underprivileged people in the world (those who couldn't afford birth control, and therefore couldn't afford to decide not to have children) were procreating. What would the next generation look like? What would be the prospects for global economic growth? And what kinds of decisions would such a scenario lead governments and voters to make, if the rich and powerful had no direct connection to the next generation of humans?

I don't know the answers to all of these questions (especially since many of them are purely academic in nature), but I do know that those who have the weakest connection to the future are the least likely to make good decisions with respect to said future. And if we continue to make decisions that sacrifice the future to benefit today, then I'm pretty sure we're not going to like the future very much once we do get there.

[New York Times]
(h/t Marginal Revolution)

Quote of (This) Week

As I'm still catching up around here, it's now time for this week's Quote of the Week (as opposed to last week's Quote of the Week, which I posted yesterday). This one is from one of the coolest golfers in the world, Miguel Angel Jimenez. This guy looks like a cartoon character, he's always smoking a cigar, and now he's the oldest guy to win a tournament on the European Tour. He's the best.

This week's QUOTE OF THE WEEK

"There is maybe olive oil in my joints, and drinking the nice Rioja wine and those things keeps me fit and flexible... Well, the most important thing (is), I do what I like to do in my life, and golf has given me all of this pleasure."
                              - Golfer Miguel Angel Jimenez

What a fantastic line. Seriously, I love this guy. He's got an awesome attitude about everything, and he's also terrific at what he does. Congrats to him for continuing to play golf at the highest level.

[ESPN]

Quote of (Last) Week

It's time to do a little catch-up around here, as it seems to be a lot recently. We'll start with last week's Quote of the Week, which never got posted because I'm a delinquent. It comes from NBC Sports' Mike Florio, whose "Pro Football Talk" is a staple of NFL news reporting. It's also batshit nuts. I'll give you the full context, so that you can appreciate the (lack of) development of Florio's argument.

This week's QUOTE OF THE WEEK

"More than a few NFL players have made known this year their intention to miss a game in lieu of missing the birth of a child.

If push comes to shove, however, should they choose to be present for the pushing and not the shoving?

It’s a thorny issue.  My position was and is that the players have made a lifestyle choice that entails being available 16 days per year, no matter what.  If they choose not to plan their nine-month family expansion activities to coincide with the eight months per year when their work activities don’t entail playing games that count, why should their teams suffer the consequences?"
                                                        - Mike Florio, NBC Sports

Wow. "Family expansion activities," first of all, is an epic turn of phrase that deserves to be commemorated for all time in the Mike Florio Hall of Fame. The rest of the Florio piece basically speaks for itself, in a tone-deaf "football isn't everything, it's the only thing" sort of way.

Insinuating that a football player can and should have full control over when his wife gets pregnant is only a couple of small steps removed from declaring that pregnancy cannot result from a "legitimate rape". Remember that what Florio is really trying to suggest here is to say that players should only have sex with their wives during the season, so that they can reasonably be expected to go into labor in the offseason (when we include the playoffs and training camp, the offseason is a whole lot closer to 4 or 5 months than the 8 months that he suggests).

That's right, during the season, when the players are constantly on the road, or recuperating from injuries, or spending late nights at the stadium watching film because WINNING IS EVERYTHING. And if you can't get the job done this season, too bad, my friend, you better wait till next season to try again. Hopefully your wife's biological clock is kind enough to stop ticking for our benefit.

Now... to Florio's credit, he backed off of his initial statements and actually subsequently penned a much more reasonable and well-articulated piece on the topic. This incident, therefore, seems to have been a case of publishing-before-editing, which is increasingly common in the internet/blogging era of journalism.

Nevertheless, the mentality that Florio initially articulated persists among fans and journalists throughout the country, and it's an ugly and dangerous mentality. Whatever your job may be, nobody should ever suggest that performing it at the highest level should take precedence over family and good parenting. That's particularly true in an entertainment industry like professional sports, which many people take way too seriously at the end of the day.

Missing one or two games over the course of a career in order to attend to major family events should never be something that fans take issue with, especially when fans (and TV networks) already expect teams full of players to miss holidays like Thanksgiving and Christmas and New Years simply to add incrementally to our enjoyment of those same holidays. These players sacrifice large portions of their lives (and their personal health) for our entertainment, and some people would request that they sacrifice even more. That's a terrible attitude to have, no matter how much these guys get paid (some of them, a ton, others, not so much). I'd rather we just said "thank you," and went on our way.

[Pro Football Talk]

Quote of the Week (Election Edition)

I'll make this one quick and just throw out some interesting words to ponder, on this Presidential Election Day. I don't agree with everything written in Douglas French's epic rant, but I do think there is some serious food for thought in there.

No matter how things break tonight, there will be a lot of very happy people, a lot of very angry people, and a lot of people like me, wishing that it didn't have to be like that. When a nation is so bitterly divided that it forgets that we're all in this together, I think that's unequivocally a negative thing. But so be it.

This week's QUOTE OF THE WEEK

"There are thousands of elections every year. Political positions from constable to governor are elected constantly. So with all of these layers of democracy — this great thing that America spends so many lives and so much money exporting — is America freer? With this constant turnover of political blood, is business allowed to operate unfettered? After all, we are led to believe democracy is synonymous with freedom. No democracy, no freedom.

America was attacked on Sept. 11 because they hate us for our freedoms, we’re told. America is so free it has the highest incarceration rate in the world, with 750 prisoners per 100,000 citizens. More than 2.3 million people are locked up, and many more millions are on probation. Is this the upside of this great thing — democracy?"
                                                - Douglas French, The Daily Reckoning

Interesting stuff to think about, either way, and similar to this bit from Stephen Fry, which will be this post's parting shot.


Get out there and vote today, regardless—apathy may feel good, but it does nothing to help any of our issues.

[Daily Reckoning]

Quote of the Week

I've always been a big fan of The Onion, and this week I had to pass along what I thought was a particularly awesome bit of work from them.

Introducing The Onion Book of Known Knowledge, clearly the greatest encyclopedia in world history, and also the source of this week's Quote of the Week. I present to you the introduction to the Book's entry on "Christianity", the world's most popular religion.

This week's QUOTE OF THE WEEK

"Christianity, monotheistic religion occasionally rooted in the teachings of Jesus Christ, whom Christians regard as the son of God and a sometimes-convenient model for their own values and behavior. Christ promulgated charity, humility, nonviolence, and other virtues that Christians once in a while regard as sacrosanct and that, when sporadically adhered to, demonstrate the path to a righteous life. The world’s 2.2 billion Christians consider Jesus a messianic figure who will deliver to heaven all who conduct themselves as he did when the mood strikes them and if they have the time."
                             - The Onion Book of Known Knowledge

I think the timing of this little takedown is particularly apt, given the interesting (though rarely discussed) religious undertones which underlie our current Presidential election. With an ever-increasing population of evangelical Christians among the voting ranks, especially in many of the nation's swing states, the opinion of the so-called "Christian right" is typically heard very loudly in November.

In this election, those voters are faced with a bit of a dilemma—the sitting President is a practicing Christian whom many people believe is secretly a Muslim, whereas the Republican challenger is a high-ranking official of the Mormon church, which many Christians sneeringly deride as a cult. This has led to some strange and awkward moments for religious conservatives like Billy Graham, who recently had to remove Mormonism from his "list of cults" so as to encourage his followers to vote for Romney instead of Obama. These are strange times indeed for the Christians in our nation, many of whom are not sure exactly what to do in two weeks.

Of course, I must admit that The Onion's criticisms are hardly unique to Christianity—they could just as easily be applied to Islam, for example—but their short satirical summary certainly does give some food for thought, while possibly helping to explain people like this and places like this. No, not all Christians (or religious people of any persuasion) are bad people or hypocrites, but neither are all churchgoers good or honest people. One does not necessarily lead to the other, even though many people do profess to be good citizens and members of their community simply because they regularly attend services on Sunday. It's a pet peeve of mine, and it's a significant reason behind my personal disillusionment with the church during my adulthood.

Yes, I recognize that I'm treading on a third rail here, foolishly discussing both religion and politics at the same time—typically, it's advisable to talk about neither, under any circumstances. But with a possibly pivotal Presidential election hanging in the balance, it's simply no longer possible to ignore the elephant in the room. Whichever way voters lean in November, religion (and race) will certainly have a big role to play.

[The Onion]

Quote of the Week (French teachers' edition)

After a slow start to the week, I've got a whole bunch of posts coming your way today and tomorrow (many of them quick hitters). As for this week's Quote of the Week, this week's contest was in fact no contest at all. French President Francois Hollande won this thing going away, making him (I think) our first ever two-time Quote of the Week champion...

This week's QUOTE OF THE WEEK

"French President François Hollande has said he will end homework as part of a series of reforms to overhaul the country’s education system. And the reason he wants to ban homework? He doesn’t think it is fair that some kids get help from their parents at home while children who come from disadvantaged families don’t."
                                       - Valerie Strauss, Washington Post

Ban homework!! That's a brilliant idea... what we really need in order to reform education is for our kids to be studying less, not more. That's the ticket!

Ironically, countries that are rapidly going broke—which France most certainly is—should probably be encouraging homework, rather than discouraging it. The more learning that can be outsourced to the home, the fewer government-subsidized teacher hours need to be purchased in order to educate the populace. But, of course, that just isn't fair.

Furthermore, this is just an instance of mind-numbing ignorance on the part of Hollande. To assume that simply eliminating homework means that affluent children will learn nothing from their parents when they are home is idiotic. The parents will still have the opportunity to hire private tutors, pay for music lessons for their children, buy their children books that the poorer children cannot afford, and generally provide a well-rounded life full of education and learning, regardless of what's happening (or being assigned) at their schools.

If you want to ban homework, you really shouldn't stop there. The real key is to ban non-affluent parents, because their kids shouldn't have to bear the costs of their inevitable poor parenting. Therefore, from here on out, all French children will be removed from their birth parents and raised only in affluent households by considerate parents. Great success!

[Washington Post]

Quote of the Week

As usual, I've got some catching up to do here on the blog. We'll start things off today with your belated Quote of the Week, then your Clip of the Week will be right behind it. I may throw in an extra post just for kicks, but I'll probably hold off on it until tomorrow—you all know how much I love writing on Fridays.

The leader in the clubhouse for this week's Quote was this post over on the Marginal Revolution blog, which shared some seriously bizarre tidbits about people's intense love for K-Pop (what's K-Pop? This is K-Pop; so is this). Fanaticism knows few bounds, apparently.

But then I came across this post at The Motley Fool, which was frankly so terrifying that I couldn't help but write about it on the blog. So here's your Quote of the Week... go America.

This week's QUOTE OF THE WEEK

"As part of the Dodd-Frank Act, lawmakers directed the [Securities & Exchange Commission] to figure out how much average investors knew about the stocks and mutual funds that they held. Here's what they found: You are an idiot... Statistically, the SEC found that American investors—regardless of age, race, or gender—'lack basic financial literacy,' and that they generally do not understand even 'the most elementary financial concepts such as compound interest and inflation.' The surveys suggest that certain sub-groups, including the elderly... 'have an even greater lack of investment knowledge' of concepts like the difference between stocks and bonds, and are unaware of investment costs and their impact on investment returns.
                                                  - Bill Mann, Motley Fool Funds

What's perhaps most concerning about this post is what Mann later points out—this study didn't consider ALL Americans, it ONLY CONSIDERED THOSE WHO ARE ALREADY DEEMED TO BE ACTIVE INVESTORS. If active investors can't adequately answer a question like "what's a stock", then I admit that I have seriously overestimated the intelligence level of my nation. Unfortunately, it appears that's the case.

Now, granted, my inner tin-foil-hat man does look at this survey data with a fair bit of skepticism, recognizing that the SEC has a vested interest in reporting that investors are gullible fools who need to be saved from themselves (by the SEC, of course). That said, I have a very hard time contradicting the study's results—frankly, it all sounds just about right.

If you watch the Presidential (and Vice Presidential) debates this fall, and you start to notice that the candidates are speaking about the economy and the markets in a way that seems designed to confuse, please know that it's absolutely on purpose—they assume that you don't understand this stuff, so it's in their interest to speak in circles so as to confuse you.

You won't know the difference either way, and you'll therefore be forced to choose the guy who "looked the best" doing it. That is, unless you choose to educate yourself. And if you read this blog, I'd like to think that you're already doing so. Otherwise, I've probably been confusing the hell out of you for a long time now. My bad, guys.

[Motley Fool]

Quote of the Week

A few months ago, I wrote a post about the Black-Scholes pricing model, its role in the financial crisis, and how economists continue to do themselves a terrible disservice by insisting that their discipline is a physical science like physics or biology, rather than the inexact social science that it is. I wrote:

We all use models in our daily lives, because they help us to make sense of what are often very complex problems. Models simplify, organize, and categorize the variables in an uncertain world so that we can better understand the impacts of our decisions. But they DO NOT, ever, have the power to tell us what to do. You don't even need to know a thing about Black-Scholes (and trust me, a lot of people who should know a lot about it... don't) in order to accept that assertion as fact. 

The intelligent person knows to use a model only as a guide to confirm (or refute) what our intuition tells us. Very often, our painfully simple heuristic models (which you can learn or hear more about from Gerd Gigerenzer's speech, if you're a nerd like me) actually outperform very elegant statistical models. How can this be? The answer lies in this brilliant polemic from economist Robert Wenzel (which is almost as great as a similar recent rant from Jim Grant).

In the science of physics, we know that water freezes at 32 degrees. We can predict with immense accuracy exactly how far a rocket ship will travel filled with 500 gallons of fuel. There is preciseness because there are constants, which do not change and upon which equations can be constructed. 

There are no such constants in the field of economics since the science of economics deals with human action, which can change at any time. If potato prices remain the same for 10 weeks, it does not mean they will be the same the following day. I defy anyone in this room to provide me with a constant in the field of economics that has the same unchanging constancy that exists in the fields of physics or chemistry.  

And yet, in paper after paper here at the Federal Reserve, I see equations built as though constants do exist.

Wenzel is dead on. We all know that models are useful, but they do not remove responsibility for rational risk management—only people have the power to do that. When callous risk managers at huge investment banks take another man's model on faith, and make huge bets with billions of dollars on the line without sanity-checking the model, that's nobody's fault but theirs.

While my points were correct, I took a little while to get the point across. For a more pithy take on things, we'll turn to Barry Ritholtz, for this week's Quote of the Week.

This week's QUOTE OF THE WEEK

"Economists are neither Engineers nor Scientists, as each of these fields has a significant degree of precision in what they do, and test their hypotheses in a lab. The better choice for Economists are 'Historian' or 'Sociologists.' The sooner the profession loses its 'physics penis-envy', the better off we all will be."
                                                  - Blogger Barry Ritholtz

I'll just let that "physics penis-envy" line stand on its own, because I think it's the single greatest takedown of modern economics that I've ever seen.

As our economy becomes more and more dependent on the fantasy-land models put together on Ben Bernanke's laptop, I sincerely hope that the damage done by these grand experiments isn't so grave that we all end up suffering for decades. But if we allow ourselves to entrust ever more of our lives to these "scientists", we're certainly running that risk.

Quote of the Week

This week's Quote of the Week is going to be a bit of a cheat, in that it's really a Clip of the Week. I'm not going to do any setup of this quote (short of posting up this blog post, which is particularly apt), except to say that this is actor Craig T. Nelson, it's three years old, and yet I just saw it for the first time and think it's terrific.

I'll be referring back to this Quote in a blog post that I intend to write tomorrow, but for now, enjoy the awesomeness.

This week's QUOTE OF THE WEEK

"We are a capitalistic society. Okay, I go into business, I don't make it, I go bankrupt. They're not gonna bail me out. I've been on food stamps and welfare, did anybody help me out? No." 
                                             - Craig T. Nelson

Simply stunning ignorance. Amazing work.

Quote of the Week

If you're like me (or like this guy), you got plenty sick of seeing Bob Costas' face on NBC during the Olympic coverage this summer. Be that as it may, Costas was on with Conan last week, and he took some pretty funny shots at NBC, endearing himself to some of the viewers and redeeming himself at least a little bit in the process. He's still a smug, smarmy, takes-himself-way-too-seriously little troll, but at least he seems willing to acknowledge that fact at times.

Either way, I got a kick out of his appearance on Conan, and he gets this week's honor for his ironic sense of humor.

This week's QUOTE OF THE WEEK

"I'm sure you'd be the first to attest, Conan, that when it comes to the tough calls, NBC usually gets them right."
                               - Bob Costas

Watch the video below to see the context. Good stuff.

Quote of the Week (I love Canada edition)

Couple of blog posts coming your way today, starting with your Quote of the Week, which will be a little lighter for a change. I gave some serious consideration to this eye-opening quote from Vladimir Putin, extolling the virtues of group sex (seriously, can you imagine Obama dropping a bomb like that on the campaign trail?), but nahhhh.

Instead, I'm going to keep things a little closer to home, heading up to America's hat. From Quebec...

This week's QUOTE OF THE WEEK

"Someone (possibly wearing super villain gear, although that’s pure speculation on my part until they’re apprehended) broke through security at the Global Strategic Maple Syrup Reserve in Quebec and made off with $30 million worth of Canada’s sweetest export."
                                         - Brad Moon, Wired
 
Whoa, whoa, whoa... Canada has a Strategic Maple Syrup Reserve? That... is... AWESOME.

Here in the good old U.S. of A., we maintain a Strategic Petroleum Reserve, to be tapped during times of supply disruptions or other emergencies (like, you know, a Presidential election... side note, amazing that the link there doesn't mention Fed policy at all when discussing the impacts on crude oil prices... savvy). At any rate, a petroleum reserve is one thing, given the outsized impact that fuel prices tend to have on our economy. But up in Canada, it's apparently maple syrup that's the prized commodity. Terrific.

This news item plays into all of the awesome stereotypes that I already want to have about Canada, so I'm not going to bother to do any further research into this matter. Canada is an awesome land of flapjacks and maple syrup and flannel shirts and lumberjacks and hockey and all of those things combined into something called "lumberjack hockey", and that's how I'm going to leave it. I love you, Canada.

[Wired]