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Max Keiser on Goldman Sachs

This interview with Max Keiser is fantastic. Keiser doesn’t hold back with regard to how he views Goldman Sachs as “scum” that has “co-opted” the U.S. government. He even goes on to say they are financial terrorists that effectively held the U.S. hostage by claiming that the world would end if they weren’t bailed out (essentially, Keiser is equating the likes of Hank Paulson, who was head of the treasury when the massive bailout was orchestrated and is an ex-Goldman CEO was basically working for Goldman in his role at the Treasury). And yeah, Max is an outspoken guy, but I have to wonder how many others out there on Wall Street are thinking something very similar but keeping their mouths shut (out of fear of retribution or whatever).

Regardless, you have to wonder: something is extremely wrong when an investment bank squeaked out of implosion a year ago thanks to a massive government bailout only to be the last man standing to reap the benefits of underwriting tons of equity as a quasi-bank-quasi-hedge-fund-with-supreme-access-to-the-U.S.-government and then makes enough money to pay all of their employees $300K+ in salaries/bonuses.

If that isn’t confusing, if that doesn’t make you scratch your head and say, “huh?” then just start looking around. There are a few people like Max, Barry Ritholtz, and, of course, Matt Taibbi (See his RollingStone article if you haven’t already) who are spreading the word.

And this isn’t about envy over a company being profitable. It’s about a company that is succeeding because they have massive influence in D.C. and with the Fed and Treasury. That’s not right. It’s not capitalism. It’s not a free market.

Ok that’s enough from me.

[video:youtube:VSwWy4E6I04]

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Michael Jackson’s Life a Disturbing Portrayal of American Culture

http://bit.ly/14TCLS

Note: I don’t normally get into celebrity deaths, but to say Michael Jackson was an icon would be an understatement. Despite any number of freak-things related to the King of Pop, he was still an amazingly talented individual who created some fantastic music. I can’t say he’ll be missed — he’s only missed insomuch as I could displace the good things about him from the bad. And that had become increasingly difficult if not impossible over the past ten years.

From Yahoo! Finance comes an article titled “Jackson lived like king but died awash in debt.” You probably already know the gist. Jackson created any number of fantasies, from his freak narcissim to Neverland Ranch. He lived a life of extravagance and died almost a half billion dollars in debt.

A few short descriptors that come to mind when I think about Michael Jackson:

  • He was an amazing talent and produced a veritable catalog of pop masterpieces.
  • His family was dysfunctional — often disturbingly so.
  • He went from lavish wealth to huge debt. He got foreclosed on with Neverland Ranch.
  • After things had started going downhill, MJ’s investment in the Beatles’ songs (owning the copyrights) kept him afloat. It has always struck me as odd that you could own someone else’s musical creation. Rent seeking off of intellectual property rights? Check.
  • Jackson was freakishly narcissistic and/or had an extreme case of body dysmorphic disorder, engaging in all sorts of plastic surgery endeavors that ultimately made him look alien/gross/non-human.
  • He had some serious demons with regard to his sexual identity. Whether he actually acted on these things or not, I don’t know — it doesn’t matter, really. He had problems and they related to his sexuality.
  • MJ was one of most obsessed-over celebrities ever. And look how that turned out — he made his kids wear masks in public.
  • He died young of a heart attack.

I submit that Michael Jackson’s life is one of the more disturbing examples of modern American culture. He was an extreme case, for sure, but his problems are not unique: too much debt, too much spending, rent-seeking off of other’s work, twisted narcissism, broken family, repressed sexuality, and dying young of a heart attack*, the end result of a life of stress and poor nutrition.

It makes me sad to make this connection, but it’s just too striking to ignore.

America, what have we become?

* I guess cause of death is yet to be officially ascertained, but we’ll roll with this for now.

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“People are complicated!”

http://xkcd.com/592/

Love the latest xkcd comic:

people are complicated!

In three frames xkcd indicts central planning with the single line that, “People are complicated!”

Why is this simple truth so hard to understand? If people are complicated, so are all systems of human interaction (i.e. markets, government, relationships, etc.). And it doesn’t stop there, of course: all dynamic systems are complicated.

It shouldn’t be a surprise that the simple-minded solutions of central planners fail to manage such unpredictable complexity. So why are they even trying?

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Chance Wins

http://www.blog.sethrober…what-causes-it/

This bit by Seth Roberts reminds me all at once of Nassim Taleb’s work (Status quo, the fed turkey, works until it completely implodes), Seth Godin’s “This is Broken” idea, and the dinosaurs going extinct.

Who is flying this plane? Do they really know what they are doing? Does chance win over purpose?

Seth’s blog post is centered around the broken U.S. healthcare system — a system which suffers both from a burgeoning status quo as well as no means of introducing alternative solutions. In other words, it is entrenched.

And just like the dinos, when that entrenchment ultimately leads to social upheaval, the failure may be catastrophic.

A robust system must be dynamic.

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Our system of human development is broken

http://daviddfriedman.blo…ed-talents.html

When I read this latest from David Friedman, I couldn’t help but think of one word, “broken.” There are so many people, myself frequently included, who are wasting their lives doing things they loathe. Meanwhile, they engage in hobbies, “other worlds” where their talents and energies are spent doing things they enjoy.

What we have is a system that tries to make widgets out of human beings. When the human beings inevitably fail to enjoy their particular widget design, they resort to other activities to distract or make their corporate lives bearable. Everyone loses in this system because people are not deployed to their highest and best (and most fulfilling) use.

The system is broken.

I was reminded of this recently when someone I know in WoW as an unusually competent and charismatic leader, organizer, and player, mentioned the problem of “parental agro.” He is apparently a college student, possibly a graduate student, living with his parents. Older examples are friends in the SCA of whose abilities and energy I think highly, who made their living as school teachers or secretaries or the like—respectable jobs, but not particularly high status or high paying ones.

The pattern is not entirely surprising. It makes sense that an energetic individual who doesn’t find much outlet for his energies in his current career will direct them towards his hobbies. Adam Smith long ago observed that, in the British universities of the time, a professor got no benefit by doing a good job of teaching, since the professors were on salary rather than, as in at least some of the Scottish universities, paid by the students. He concluded that if the professor were naturally energetic, he would spend his energies doing something that might be of some benefit to him rather than doing his job, which would not. Nowadays we call it “consulting.”

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“Their minds close and they turn around and go back to their lives.”

http://www.blog.sethrober…art-14-the-end/

I did a site search on Seth’s blog for “fructose” (On how to do these and improve your use of Google Search) as I was curious if Roberts had seen any negative impact to using fructose in his Shangri-La Diet. I wondered this because fructose is apparently sweeter than glucose, which per the SLD theory that flavor/calorie associations spur weight gain, might imply that ingesting fructose would actually cause weight gain (I was trying to tie this all together into Stephen at WHS’s recent post about sugar). Alas, apparently sugar-water using nothing but fructose works fine on SLD. I forgot that plain sugar water is tasteless regardless of the sugar used (I don’t understand how sugar is sweet, but sugar water is not, but it’s true)

Anyway, in a roundabout way I got to reading Roberts’ interview with Taubes (Only read the last two parts out of fourteen: need to find the time to read the rest!). It was at the end of this interview that Taubes made a fascinating comment about how people in the scientific community react to his research on insulin and carbohydrates. Specifically, these otherwise intelligent and reasoning folk tend to close their minds as soon as Taubes drops the “C word:” carbohydrates. One word shuts them down as they write off Taubes’ immense research by way of invoking the “Atkins diet” or any number of other “low-carb diets” that were all the rage a few years ago.

And I couldn’t help but think how this mental shutdown is what I’ve seen countless times with any person of religion — people who otherwise may agree with any number of points you make will completely shutdown on the invocation of certain words.

This is a fantastic example of rational people utterly failing to apply reason, and it is exemplified by scientists and people of faith, alike. Indeed, the common thread here is simply dogma. Interesting.

TAUBES I think that’s true, but there’s this contrary effect that happens. I said this in my lecture. The science I’m trying to get across can be accepted up until the point at which I say the the word carbohydrate, and then people shut down, and they think “Oh, it’s that Atkins stuff again.” Their minds close and they turn around and go back to their lives. Anyway, I look forward to seeing the interview and getting your book and reading it. I enjoyed this. Again, I like nothing better than talking about this stuff.

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Birthday Shoes dot com

As regular readers know, I have a pair of Vibram FiveFingers Classics (Reviewed last summer). I’ve gotten a lot of use out of my VFFs, having worn them for CrossFit, short runs, sprints, frisbee, world traveling, weight lifting, and for everyday uses like going to the grocery store or any number of other activities. Suffice to say that I think FiveFingers are a fantastic product and allow me the freedom of barefootedness.

So it was with great joy that I recently procured a pair of Five Finger KSOs via John at Kayak Shed, which I just reviewed yesterday. What’s that? You didn’t see my review? That’s because it’s not on justinowings.com. Rather, it is on my latest project, Birthday Shoes dot com, a site dedicated to being barefoot by way of consolidating information about the closest-thing-to-barefooted-footwear-available, Vibram FiveFingers:

Let me guess your thoughts. You think I’m out of my gourd to create a site about barefootedness, specifically one to support a product that is difficult to describe, a sock/shoe/foot-glove/ninja-shoe.

You might be right.

Five Fingers are just footwear: how great could this product be? Pretty extraordinary, actually. Why? Because they empower us modern hunter-gatherers to move about the earth and do things in accordance with our evolutionary design, which is to say, locomote a concrete, polluted and often trashy world wearing virtually nothing on our “birthday shoes” (Yeah, like “birthday suit!”) but a thin piece of rubber sole.

And though it might not be obvious at first glance, this is a very big deal. FiveFingers are important because they are designed to work harmoniously with our human nature. Sure, we all could entirely ditch any form of footwear, build up callouses on our feet, and roam the earth completely barefoot (Indeed, many do), but such a pure solution is also out of reach for most of us. By comparison, just as many pursue a “primal” or “paleo” diet by cutting out grains, sugar, heavily processed foods, and other modern food inventions, we still live in a modern world and aren’t hunting and gathering in a true sense, nor should we. There are fantastic benefits of modern technology; the trick is finding ways to marry our genetic hardwiring with our modern inventions.

FiveFingers go a long way towards that goal.

Birthday Shoes is an attempt to centralize information about Five Fingers, be a hub for different VFF experiences, display humans being human, barefooted or in their birthday shoes, and ultimately act as a sort of gateway-idea*, that can open the eyes of otherwise domesticated, corporate-dwelling, debt-servicing, and generally depressed people to a freer world, one more harmonious with our human nature.

In short, maybe I’m not that crazy after all, or at least, there is a method behind my madness. Check it out:

birthday shoes dot com

Recent posts at birthdayshoes.com:

* I’ve also called it a “trojan horse idea.” I can’t decide which way to describe VFFs is catchier. “Trojan horse” is kinda fun because the VFF is literally not unlike a mask or cover-up for our feet, hiding the reality of what is really going on. “Gateway idea” is nice because it uses the “gateway drug” definition — VFFs serve as a gateway or catalyst towards higher understanding about other things. Ah maybe I should just use both.

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Acheiving the HGH Flush in a Workout

http://fitnessblackbook.c…the-sweet-spot/

Rusty over at Fitness Black Book talks about how to know when you’ve reached a point where your workout intensity will have the lingering metabolism-boosting effect. The test is what he calls the “HGH Flush,” which is basically that point where you lose your breath and your skin is warm to the touch.

This is interesting to me for a couple of reasons. One, I think I’ve unwittingly been measuring my personal workout success by whether or not I reached this HGH flush state. I just hadn’t quite articulated it. Two, a part of this that Rusty mentions is not to do too much. It’s here that I think back to my CrossFit experience last summer, in which I put on muscle and lost some fat, as well. Any CrossFitter knows that the workouts typically result in an HGH Flush by design and also are completed in less then 30 minutes. In other words, they are very intense but also brief.

Comparatively, when I was making a concerted effort at additional fat loss earlier this year, I’d occassionally reach the HGH Flush, but overall, I just did more workout volume. Perhaps this is why I didn’t see noticeable results despite an ample amount of effort (in both IF, diet, and exercise).

How to Tell If Your Fat Loss Workout is the Correct Intensity?

I look for a thing called the “HGH Flush”. I forget who coined this term, but this is just an indicator of a good fat loss workout. If your skin is slightly red and hot to the touch and you are out of breath after your workout, then you have achieved the HGH flush. Remember your PE teacher in Junior High making you “run lines” or pushing you until you were out of breath and your skin felt like it was on fire? This is the HGH flush which is an indicator that your metabolism will be increased after your workout and that your body will release a bit more HGH than normal (your body’s fat burning hormone).

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Nassim Taleb is no friend of academics

Nassim Nicholas Taleb’s latest from Opacity, no 114 titled “Where is the evidence?” launches into Nassim’s current interest in how we know things given the lack of evidence (That is probably summed up poorly, but it is a focus on the absence of evidence/evidence of absence problem and humanity’s gross ignorance. Taleb mentions the concept in the hour long podcast at EconTalk if you’ve got the time to listen to it).

Taleb’s admonition of academia is brutal — i.e. Taleb says Ben Bernanke and Larry Summers are “arrogant, formal-thinking civil servants, and Ivy-league semi-retards.”

I’m still not convinced the admonition about negative advice is exactly right, but why quibble? (See prior discussion on Nassim Taleb and Expert Advice)

Finally, I’ve ordered two books by John Gray, who Taleb cites as the “greatest living thinker.” And to think I hadn’t even heard of the guy.

I leave aside the confusion absence of evidence/evidence of absence–and the misunderstanding of the very notion of “empiricism”. It is a fact that in the real world of our daily decision-making 1) we do not have much evidence of most relevant things, yet we need to take action; 2) in most situations, “true/false” is never symmetric (one side is more harmful than the other), so the burden of evidence is one-sided. Which is why once these fakes “doing science” lose their tenures after the endowments (and charity) run out of funds, they will be barely fit to do anything in the real-life ecology. I wonder what you can do with an unemployed, say, academic orthodox economist. You could do better with non-post-academic cab drivers. Clearly those the most fit at dealing with “just evidence” will be idiot savants outside their evidence domain.

And I can expect that with the SP500 about 20% lower than here, you will see tenures unexpectedly evaporating. The silver-lining of the crisis, perhaps, with the de-academification of society.

So let me take this into more interesting territory, and express my anti-social-planner views. Even more that in Hayek’s days, the ecology of the real world is becoming too complex for Aristotelian logic: very, very little of what we do can be safely formalized, meaning asymmetries matter more than ever. Which puts the Western World today at the most dangerous point in its history: unless we get the Bernanke-Summers crowd out of there, it will eventually be destroyed by the machinery of arrogant, formal-thinking civil servants, and Ivy-league semi-retards.

Finally, beyond the current mess, I see no way out of this ecological problem, except through that tacit, unexplainable, seasoned, thoughtful, and aged thing crystalized by traditions & religions –we can’t live without charts and we need to rely on the ones we’ve used for millennia.

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Citizen Media Law Project covers IEHI’s New Hampshire Case

http://www.citmedialaw.or…0-what-have-you

Many of you may not be aware of this, but my company IEHI, Inc. (I.e. the Mortgage Lender Implode-O-Meter) is involved in two lawsuits. Both are absurd in their own right and work to stifle whistleblowing activities. Both have cost our company a great deal of time and money to defend (And the lawsuits are ongoing).

I won’t go into the details of these cases here, but if you want to know more:

Our primary website ml-implode.com is a thorn in the side for many because it takes a sardonic view of the imploding mortgage industry. Ever since the site was founded, way back before most of us had even heard of “subprime,” ML-Implode has broken big news that has made CEOs cringe, often alerting employees to their own company’s impending demise before their managers had bellied up and let the cat out of the bag (a.k.a. “I’m sorry, but we’re all out of a job.”). As distasteful as this function may be to some, we side on getting quality information out as soon as possible so that people can make informed decisions. Sometimes that pisses people off. We do not do it lightly.

As it is, the financial implosion genie has long since escaped the bottle. It’s common knowledge that the world is in a recessioin/depression/stagflation/OMG!WTF!/YGTBFKM! situation, so the fact that a start-up financial news site is getting hammered on by lawsuits has been largely ignored. Fortunately, with the recent Goldman Sachs suing of blogger Mike Morgan and articles like the one from Citizen Media Law Project (excerpted below – read it in full!), there may be a glimmer of hope.

I’m posting all of these thoughts on my personal blog to spread the word that just as we are being sued for not shutting up, your free speech is being attacked. Financial considerations aside, simply being aware of these attacks is important to you. The Internet has made way for little guys to be heard; unfortunately, little guys are still squashed by the big companies who have thousands of dollars to throw at legal fees all in an effort to stifle criticism. First amendment rights are fantastic in theory, but if the rubber doesn’t meet the road in cases like ours, anyone who posts material on the internet (And with Facebook, Twitter, millions of forums and blogs, who doesn’t?) is susceptible to losing everything they’ve worked for to frivolous lawsuits funded by deep pockets (The very deep pockets used to lobby the government for bailout funds or new legal loopholes to exploit).

So take note, and spread the word. Thanks. And here’s The Citizen Media Law Project’s take on our New Hampshire case (which we are appealing):

A reader recently tipped us off to a troubling ruling from a trial court in New Hampshire: The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc., No. 08-E-0572 (N.H. Super. Ct. Mar. 11, 2009). In the decision, Justice McHugh of the Superior Court for Rockingham County ordered the publishers of the popular mortgage industry watchdog site, The Mortgage Lender Implode-O-Meter (“ML-Implode”), to turn over the identity of an anonymous source who provided ML-Implode with a copy of a financial document prepared by The Mortgage Specialists, Inc. for submission to the New Hampshire Banking Department. The court also ordered ML-Implode to reveal the identity of an anonymous commenter who allegedly posted defamatory statements about the company and enjoined the website from re-posting the financial document or the allegedly defamatory comments. …

Justice McHugh’s March ruling granted all of the requested relief. He issued an order: (1) prohibiting ML-Implode and its agents from “displaying, posting, publishing, distributing, linking to, [or disseminating] copies and/or images of [the] 2007 Loan Chart and any information or data contained therein”; (2) requiring ML-Implode to “disclose the identity of the individual and/or entity that provided it with the 2007 Loan Chart”; (3) requiring ML-Implode to produce all other documents concerning MSI that ML-Implode received from the source of the 2007 Loan Chart; (4) prohibiting ML-Implode from re-posting the “Brianbattersby” statements; and (5) requiring ML-Implode to disclose the identity of “Brianbattersby.”

Justice McHugh’s decision is troubling on so many levels that it is hard to even list them all, but I will start with its blasé attitude towards the whole matter. The court issued no detailed findings of fact or conclusions of law before issuing the injunction, held no evidentiary hearing (apparently the parties agreed to this), and failed to even specify what cause of action supported its decision to enjoin publication of the 2007 Loan Chart. This latter point is by no means clear, because N.H. Rev. Stat. Ann. § 383:10-b looks like it creates no private right of action against non-government parties like ML-Implode. The court apparently regarded all this formality as unnecessary because MSI sought only injunctive relief not damages, but this is obviously incorrect.

But wait, it gets worse. In its filings with the court, ML-Implode argued extensively that the requested relief constituted an unconstitutional prior restraint on speech, sought information protected by New Hampshire’s qualified reporter’s privilege, and impinged on its users’ First Amendment rights to speak anonymously. The court brushed aside all of these arguments without anything I would characterize as legal analysis. Justice McHugh did not even address whether the New Hampshire reporter’s privilege, which was recognized by the New Hampshire Supreme Court in Opinion of the Justices, 373 A.2d 644 (N.H. 1977), applies to online journalism sites like ML-Implode, and, if so, whether MSI had made the showing needed to overcome the privilege. …

With respect to the allegedly defamatory forum comments, Justice McHugh failed to make any specific findings of fact regarding actual malice, falsity, or reputational harm, so it is hard to accept his ruling as a “final adjudication on the merits” that would justify injunctive relief. Moreover, the court failed to explain why MSI could circumvent the hoary principle that “equity will not enjoin a libel” simply by not asking for damages, and why section 230 of the Communications Decency Act did not block MSI’s claims for injunctive relief with respect to user-submitted content (not an uncontroversial proposition).

Justice McHugh’s opinion is also oblivious to the U.S. Supreme Court’s decision in Bartnicki v. Vopper, 532 U.S. 514 (2001), which casts serious doubt on the constitutionality of punishing the dissemination of truthful material relevant to a matter of public concern when the publisher (as opposed to the source) obtained the information in a lawful manner. True, Bartnicki addressed the constitutionality of imposing money damages for the publication of truthful speech, but enjoining truthful speech seems equally inconsistent with protecting our “‘profound national commitment to the principle that debate on public issues should be uninhibited, robust and wide-open.'” 532 U.S. at 534 (quoting New York Times v. Sullivan, 376 U.S. 254, 270 (1964)).

Instead of tackling all these difficult legal issues, Justice McHugh’s decision focuses its attention elsewhere. Throughout, it appears motivated by a conviction that MSI is not asking for anything unreasonable and that ML-Implode is not being very nice:

Then when [ML-Implode] was asked to disclose the identity of persons or entities that had provided it with unauthorized information and potentially defamatory information [ML-Implode] refused outright. One would have hoped that when a legitimate publisher of information was notified of the fact that certain unauthorized information was given to it which was then published, presumably in good faith, the publisher would, in order to maintain the integrity of its publication, willingly provide the wronged party with the information requested. Instead, [ML-Implode] exhibited a knee-jerk reaction.

This is not a view shared by publishers (big, small, offline, online) or by the law. Counsel for ML-Implode intends to appeal the judgment to the New Hampshire Supreme Court, and there is good reason to believe that the state’s high court will reverse. For now, the decision stands as an excellent example of why we need strong procedural safeguards for courts to follow when deciding whether or not to compel the identification of anonymous speakers, why shield laws that constrain judicial discretion are important, and why constitutional doctrine should limit judicial power to grant prior restraints to such a vanishingly small category of cases.