Monday, 31 March 2014

Another short priced favourite on the interest rate indicator

On the eve of the Reserve Bank board’s April meeting the Owl’s indicator pointed strongly to there being no change.
31-03-2014 aprilinterestindicator

One for that Joe Hockey audit commission: change the font and save millions

Chanel No. 5 perfume costs $38 per ounce. The equivalent amount of Hewlett-Packard printer ink can cost up to $75. So if you are a big printer like a government saving ink can produce a big saving.
That was the theory of 14-year-old Suvir Mirchandani when he was given the task at his Pittsburgh-area middle school of trying to think of ways to cut waste and save money . CNN tells the story:
2014-03-31_fonts
Interested in applying computer science to promote environmental sustainability, Suvir decided he was going to figure out if there was a better way to minimize the constant flurry of paper and ink.
Reducing paper use through recycling and dual-sided printing had been talked about before as a way to save money and conserve resources, but there was less attention paid to the ink for which the paper served as a canvas for history and algebra handouts…
Collecting random samples of teachers’ handouts, Suvir concentrated on the most commonly used characters (e, t, a, o and r).
First, he charted how often each character was used in four different typefaces: Garamond, Times New Roman, Century Gothic and Comic Sans. Then he measured how much ink was used for each letter, using a commercial tool called APFill® Ink Coverage Software.
Next he enlarged the letters, printed them and cut them out on cardstock paper to weigh them to verify his findings. He did three trials for each letter, graphing the ink usage for each font.
From this analysis, Suvir figured out that by using Garamond with its thinner strokes, his school district could reduce its ink consumption by 24%, and in turn save as much as $21,000 annually.
Encouraged by his teacher, Suvir looked to publish his findings and stumbled on the Journal for Emerging Investigators (JEI), a publication founded by a group of Harvard grad students in 2011 that provides a forum for the work of middle school and high school students. It has the same standards as academic journals, and each submission is reviewed by grad students and academics.
Suvrir was then challenged  to apply his project to a larger scale: the federal government which, with has an annual printing expenditure of $1.8 billion.
Suvir repeated his tests on five sample pages from documents on the Government Printing Office website and got similar results –change the font, save money.
Using the General Services Administration’s estimated annual cost of ink — $467 million — Suvir concluded that if the federal government used Garamond exclusively it could save nearly 30% — or $136 million per year. An additional $234 million could be saved annually if state governments also jumped on board, he reported.

Strange words from Tony Abbott and other news and views for Monday 31 March

2014-03-31_jokovichjoke
  • I thought that Facebook post must have been based on a mistake or something but no. I checked on the PM’s website and he actually said it!
  • China seizes $14.5 billion assets from family, associates of ex-security chief: sources – “Chinese authorities have seized assets worth at least 90 billion yuan ($14.5 billion) from family members and associates of retired domestic security tsar Zhou Yongkang, who is at the centre of China’s biggest corruption scandal in more than six decades, two sources said. More than 300 of Zhou’s relatives, political allies, proteges and staff have also been taken into custody or questioned in the past four months, the sources, who have been briefed on the investigation, told Reuters.”
  • Why Islamic parties don’t win Indonesian elections – “Lost claims to moral superiority and a lack of ideological difference to secular parties has made it difficult for Islam-oriented parties to compete in Indonesian politics. Another lost selling point has come with the improved provision of social welfare by secular parties, undercutting the services provided in health and education by NU and Muhammadiyah. Though still far from perfect, government welfare services are improving and in some cases now cater better to poorer voters than those provided by the two big Muslim organisations.”
  • Operation sovereign borders – “ABC News Online documents the first six months of Operation Sovereign Borders, exploring the structure and events that have characterised the operation.”
  • Do Big Banks Have Lower Operating Costs?
  • The tyranny of party politics – “If economics is subordinated to party politics, some issues will be kept off the agenda. Neither Labour nor the Tories would be keen on an economics writer who raises thoughts such as: maybe politicians can’t do anything to raise long-term economic growth; perhaps bosses pay is a reward for power rather than skill; economic forecasting is impossible so talk about fiscal policy in the next parliament is mostly otious; or perhaps there are more intelligent ways of allocating public goods than by government decree.”
  • The price of political uncertainty – “Despite obvious ties between political uncertainty and financial markets, the nature of this connection has not been studied in detail. This column describes a theoretical framework for evaluating the influence of political uncertainty on financial markets. Political uncertainty commands a risk premium, especially when the economy is weak. By raising firms’ cost of capital, it depresses investment and real activity. Furthermore, by raising risk premia, political uncertainty destroys market value.”
  • Thailand’s ‘red shirts’ gear up for a fight - “The clock is ticking for Thai Prime Minister Yingluck Shinawatra, who faces impeachment within weeks, but her supporters are hatching plans to thwart any move to dismiss her, with some leaders assembling what amount to militias.”
  • Why We Got Fatter During The Fat-Free Food Boom

Sunday, 30 March 2014

Castrating hogs to cut through the media clutter in political campaigning

I’m  Joni Ernst. I grew up castrating hogs on an Iowa farm. So when I get to Washington I’ll know how to cut pork
30-03-2014 castratinghogs
That’s the message as the relatively unknown Joni Ernst seeks the Iowa Republican Party’s U.S. Senate nomination. Her television ad is designed to cut through the media clutter without the huge expense of constant repetition.
Brian Donahue, a strategist with Craft Media, told National Public Radio that when you see an ad like Ernst’s you’re also viewing a message based on political consultants’ understanding that emotion resonates more with voters than repetition.
It’s that emotional reverberation that sends it viral. “That causes what we call ‘the Buzzfeed effect,’ ” Donahue says, whose firm counts Republican political campaigns among its clients. “It compels you to do more than just shape an opinion. It compels you to share it too. Which is why so many people are seeing an ad like this.
“It did something different and it was so unpredictable,” Donahue says. “We had a female candidate running for office and she’s talking about castration and relates it to members of Congress, which is pretty unbelievable stuff. But beyond the race she’s running, people are sharing it online and that’s the effect you want to create. And that’s what emotionally, cutting-edge media does. It takes on its own life.”
Lori Raad, a consultant whose political-messaging firm, Something Else Strategies, is behind the Ernst ad, said she knew just the word itself was going to get noticed.
“Of course, our goal was for people to watch long enough to learn about Joni Ernst,” Raad says. “I wouldn’t have guessed that people would’ve linked to it to this extent, although you always hope.”

Thursday, 27 March 2014

Paul Krugman on the economics book of the year and other news and views for Wednesday 26 March

26-03-2014 capitalpikketty
  • Wealth Over Work – “It seems safe to say that “Capital in the Twenty-First Century”, the magnum opus of the French economist Thomas Piketty, will be the most important economics book of the year — and maybe of the decade. Mr. Piketty, arguably the world’s leading expert on income and wealth inequality, does more than document the growing concentration of income in the hands of a small economic elite. He also makes a powerful case that we’re on the way back to “patrimonial capitalism,” in which the commanding heights of the economy are dominated not just by wealth, but also by inherited wealth, in which birth matters more than effort and talent.”2014-03-26_googlecompare
  • Apples Vs. Oranges: Google Tool Offers Ultimate Nutrition Smackdown
  • Putin and the Laws of Gravity – “The morning after, he was the hero of Russia. Some moronic commentators here even expressed the wish that we had such a “decisive” leader. Well, let’s see what Putin looks like the morning after the morning after, say, in six months. I make no predictions, but I will point out this. Putin is challenging three of the most powerful forces on the planet all at once: human nature, Mother Nature and Moore’s Law. Good luck with that.”
  • Australia’s luck runs out as China slows – By Henny Sender in London’ Financial Times: “Reasons to be bearish on currency and country grow daily; There is only one good reason not to short the Aussie dollar: it is expensive. But the grounds for taking a bearish view on both the currency and the country become more compelling by the day.”
  • Profiles in Courage at the IRS (Really) - ” Randolph W. Thrower was IRS commissioner from 1969 to 1971. The Nixon White House insisted that the IRS audit the president’s enemies. Thrower, a lifelong Republican, refused to do it. According to the Washington Post, he also refused to hire Nixon dirty tricksters John Caulfield and G. Gordon Liddy. In 1971, Thrower asked to meet with Nixon, believing that the president would be appalled at the attempt to use the nonpartisan agency as a political tool. Instead of a meeting, Nixon aide and future Watergate convict John Erlichman called to tell him he was fired. After Mr. Thrower was thrown out, Nixon told top aides the kind of IRS commissioner he wanted.
    I want to be sure he is a ruthless son of a bitch that he will do what he is told, that every income tax return I want to see I see, that he will go after our enemies and not go after our friends. … Now it’s as simple as that. If he isn’t, he doesn’t get the job. We’ve got to have somebody like that for a change in this place.
    Thrower died last Thursday at the age of 100.

Wednesday, 26 March 2014

Will his wish be granted with the words "Arise Sir Alexander Downer"?

I had always thought of my old paper the Sydney Telegraph as being a journal of record but it’s not so any longer it seems. Prompted by a twitterer I went looking for a Tony Abbott promise on the question of knights and dames, entered the code  http://www.dailytelegraph.com.au/news/pm-tony-abbott-rules-out-reinstating-knights-and-dames-in-oz/story-fni0cx4q-1226788026229 – and this was the sad result:
26-03-2014 notfoundBut for history’s sake I was grateful for this from Sir Tim Þe Enchanter ‏@timb07 :
https://web.archive.org/web/20131222085221/http://www.dailytelegraph.com.au/news/pm-tony-abbott-rules-out-reinstating-knights-and-dames-in-oz/story-fni0cx4q-1226788026229
From where I rescued this:
26-03-2014 noknightsWith these being the key pars:
26-03-2014 knightsanddames

Keeping it in the family – dad looks after his Murdoch boys

The succession planning in the Murdoch empire has reached a new stage with dad Rupert promoting sons Lachlan and James to key posts at News Corp and 21st Century Fox.
Lachlan now has the titles of non-executive co-chairman at both companies. James becomes co-chief operating officer at 21st Century Fox.
2014-03-26_21stfox
In a statement the proud dad had this to say about Lachlan’s elevation at News:
“This appointment is a sign of confidence in the growth potential of News Corp. and a recognition of Lachlan’s entrepreneurial leadership and passion for news, digital media and sport.
“In this elevated role, Lachlan will help us lead News Corp. forward as we expand our reach and invest in new technologies and markets around the world. We have many challenges and opportunities ahead, and Lachlan’s strategic thinking and vast knowledge of our businesses will enable me as executive chairman and the company as a whole to deliver the best outcomes on behalf of our stockholders, employees and customers.”
And of the pair of his offspring moving up t 21st Century Fox the old fellow commented:
“Lachlan is a strategic and talented executive with a rich knowledge of our businesses. From 1994 to 2007, Lachlan’s executive career at the company spanned the globe, culminating as deputy chief operating officer responsible for the group’s most important publishing businesses in addition to its vast U.S. television station holdings. I’m very pleased he is returning to a leadership role at the company, where he will work closely with me, Chase, James, and the rest of the board of directors to drive continued growth for years to come.
“We are pleased to elevate James into this important role alongside my partner and trusted advisor Chase Carey. I’m confident James and Chase will continue to make a great team during this time of immense opportunity. James has done an outstanding job driving our global television businesses and our shareholders, customers, and colleagues will benefit greatly from his many talents.
“This company has never been better positioned to capitalize on the increased global demand for quality storytelling and news, and our collective future has never been brighter.”

Butter Is Back – No evidence that saturated fat increases the risk of heart disease

Butter is back, and when you’re looking for a few chunks of pork for a stew, you can resume searching for the best pieces — the ones with the most fat. Eventually, your friends will stop glaring at you as if you’re trying to kill them.That the worm is turning became increasingly evident a couple of weeks ago, when a meta-analysis published in the journal Annals of Internal Medicine found that there’s just no evidence to support the notion that saturated fat increases the risk of heart disease. (In fact, there’s some evidence that a lack of saturated fat may be damaging.) The researchers looked at 72 different studies and, as usual, said more work — including more clinical studies — is needed. For sure. But the days of skinless chicken breasts and tubs of I Can’t Believe It’s Not Butter! may finally be drawing to a close.

Will the left handers give Wikileaks a Senate seat from West Australia?

It appears we all have a tendency to veer to the left when it comes to voting. Not towards some philosophical left. Rather an actual geographic one. And left handed people veer left much more strongly than right handers.
That, at least, is the finding of a recent experiment published in the journal Political Psychology.  The paper, Moderators of Candidate Name-Order Effects in Elections: An Experiment by Nuri Kim, Jon Krosnick and Daniel Casasanto, was based on an experimental election of two hypothetical candidates, each diverging on issues and each randomly sorted into a left or right spot on the ballot. Just as previous studies have shown a donkey vote favouring the first named candidate when people vote down a list,  candidates listed on the left-hand side of this experimental ballot enjoyed a distinct advantage in gaining votes compared with those on their right. What made the finding different came when comparing the votes of left handed people with right handed ones. ”Everyone, even righties, had a bias to select the candidate on the left, but that tendency was stronger in lefties,” author Casasanto says.
The paper itself is behind a pay wall but this is the abstract:
Past studies of elections have shown that candidates whose names were listed at the beginning of a list on a ballot often received more votes by virtue of their position. This article tests speculations about the cognitive mechanisms that might be responsible for producing the effect. In an experiment embedded in a large national Internet survey, participants read about the issue positions of two hypothetical candidates and voted for one of them in a simulated election in which candidate name order was varied. The expected effect of position appeared and was strongest (1) when participants had less information about the candidates on which to base their choices, (2) when participants felt more ambivalent about their choices, (3) among participants with more limited cognitive skills, and (4) among participants who devoted less effort to the candidate evaluation process. The name-order effect was greater among left-handed people when the candidate names were arrayed horizontally, but there was no difference between left- and right-handed people when the names were arrayed vertically. These results reinforce some broad theoretical accounts of the cognitive process that yield name-order effects in elections.
A report in the National Journal gives more details.
Let’s break down the results of the Political Psychology paper. Righties showed a bias for the candidate on the left because it is the first name they read. That’s consistent with other research on primacy, that there’s a bias for the first in a list. Lefties showed that effect, as well as an additional left-hand bias: Lefties chose the candidate on the left because his was the first name they read and because they have a positive association with things on the left. Whereas among righties, the candidate on the left showed a 21 percent advantage, among lefties, that jumped up to a 36 percent advantage.
There’s a huge caveat here. These results were pulled from an experiment on a fictitious election. And they are the first of their kind—it takes years of repetitive results to nail down a phenomenon. So take caution in extrapolation. “I don’t expect that we would see anything like that enormous, ridiculous, percentage point difference in real elections,” Casasanto says of the 21 percent and 36 percent advantages. “But in light of Jon [Krosnick]‘s previous data. I think we have every reason to believe that these effects are and can be found in real elections.”
That previous data is contained in a forthcoming paper in the journal Public Opinion Quarterly that, analyses all statewide California elections between 1976 and 2006. California rotates candidate ballot order district by district. The analysis found when candidates were listed first (no matter the ballot type), “on average, across all contests, candidates received nearly half a percentage point of additional votes compared to when they were listed either in the average of all later positions.”
In Australia the Wikileaks Party will be encouraged by this kind of research. In the new Western Australian Senate election it has drawn the prized Column A on the left hand side of a very wide ballot paper.
Last time around, when it was positioned elsewhere on the paper, Wikileaks managed only a paltry 0.73 per cent of the WA vote. That saw it eliminated quite early in the shuffling of minor party preferences that enabled a small primary vote to end up electing one of the political tiddlers in both versions of the counts that were finally held invalid leading to next month’s new poll.
Add half a percentage point because of the favourable draw and the chances of Wikileaks start looking a lot better. Add on a bit more for the impact of lefties and the Antony Green Senate Calculator: Western Australia shows them really in the race taking into account the latest lot of minor party wheeling and dealing over preferences.
Some examples:
The Wikileaks vote remains unchanged at 0.73%
2014-03-26_waresult1Wikileaks would make it to the 17th count before being excluded.
The Wikileaks vote improves by 0.5 percentage points to 1.23% – the same six elected with Wikileaks surviving until the 19th count before being eliminated.
The Wikileaks vote improves by 0.6 percentage points to 1.33%
2014-03-26_wasen2
And there we would have it: a Wikileaks Senator. A good reason for Julian Assange and his followers to get those left handers into the polling booths.

Australia on top of developed world growth list but be warned - it is just a forecast

The group of economists polled regularly by The Economist on future trends have Australia growing faster than other developed countries during 2015.
2014-03-26_gdpforecasts

Tuesday, 25 March 2014

Oh do shut up dear! The public voice of women and other news and views for Tuesday 25 March

2014-03-25_marybeard
  • The Public Voice of Women – A London Review of Books lecture at the British Museum by Mary Beard – ” I want to start very near the beginning of the tradition of Western literature, and its first recorded example of a man telling a woman to ‘shut up’; telling her that her voice was not to be heard in public.”
  • For our most powerful and hypocritical leaders, crimes are those that others commit – “Is there a better case study in brazen hypocrisy than the ongoing crisis in Crimea? Not just on the part of the loathsome Vladimir Putin, who defends Syria’s sovereignty while happily violating Ukraine’s, but on the part of western governments, too.”
  • Ukraine and the Crisis of International Law – “As frightening as the Ukraine crisis is, the more general disregard of international law in recent years must not be overlooked. Without diminishing the seriousness of Russia’s recent actions, we should note that they come in the context of repeated violations of international law by the US, the EU, and NATO. Every such violation undermines the fragile edifice of international law, and risks throwing the world into a lawless war of all against all.”
  • How to use a bank tax to make the financial system safer - “The current approach to taxing banks is perverse. It encourages precisely the kind of behaviour that supervisory authorities are trying to curb. Bank regulation requires banks to keep their equity above a specified level. Yet corporate taxation encourages the banks to use more debt and less equity. This perversity comes from the fact that corporate tax is levied on the banks’ profits. When a bank borrows money to finance its balance sheet, it incurs interest expenses that can be deducted against profits for tax purposes. The greater a bank’s borrowings, the larger the interest payments and the lower its tax bill. Tax bank liabilities instead of profits, and you will disadvantage liabilities more and bank capital less. Making that change would encourage banks to be better capitalised and stronger.
  • The Doctor and the Saint – Arundhati Roy on Ambedkar, Gandhi and the battle against caste.

Sunday, 23 March 2014

The virtues of reintroducing risk into childrens’ playtime and other news and views for Sunday 23 March

22-03-2014 ruilebook

Thursday, 20 March 2014

The banking industry has discovered that it can thrive without trust and other news and views for Thursday 20 March

  • You Don’t Say – “Peter Eavis… highlighted a statement… by… William Dudley (formerly of Goldman Sachs, then a top lieutenant to Tim Geithner): There is evidence of deep-seated cultural and ethical failures at many large financial institutions…. In 2008… people probably thought that our largest banks were just guilty of shoddy risk management, dubious sales practices, and excessive risk-taking… we’ve had to add price fixing, money laundering, bribery, and systematic fraud on the judicial system…. Framing the problem as a ‘trust issue’—customers no longer see banks as trustworthy institutions—is beside the point. Wall Street’s main defense is that its clients already realize that investment banks do not have their buy-side clients’ best interests at heart, and clients who don’t realize that are chumps. And in the wake of the financial crisis, I suspect there are few individuals out there who believe that their banks are there to help them. The banking industry has discovered that it can thrive without trust, which is not surprising; retail depositors trust the FDIC, and bond investors know that trust isn’t part of the equation…”
  • How wars can be started by history textbooks – “The imposition of an authorised version of events turns education into brainwashing.”
  • The Programmed Prospect Before Us – Robert Skidelsky reviews Mindless: Why Smarter Machines Are Making Dumber Humans by Simon Head.  ”The philosopher Hubert Dreyfus famously argued that artificial intelligence cannot mimic higher mental functions. No activity that requires intelligent behavior can be done by computers, he wrote, because algorithms cannot adequately structure the complex situations that are addressed by intelligent thinking. However, in most of the business activities described in this book, no intelligent behavior is required of most workers: the intelligence is provided by the managers; the workers only have to follow the rules of highly simplified situations. I see no reason in principle why the rules of behavior for such situations cannot be followed by machines… Recently, Michael Scherer, a Time magazine bureau chief, received a phone call from a young lady, Samantha West, asking him if he wanted a deal on health insurance. After she responded to a number of his queries in what sounded like prerecorded fashion, he asked her point-blank whether she was a robot, to which he got the reply “I am human.” When he repeated the question, the connection was cut off. Samantha West turned out to be a system of recorded messages that were part of a computer program created by the brokers for health insurance The point is not that humans were not involved, but that the experts had worked out that far fewer of them needed to be involved to sell a given quantity of health insurance. Orthodox economics tells us that automating such transactions, by lowering the cost of health insurance, will enable many more policies to be sold, or release money for other kinds of spending, thus replacing the jobs lost. But orthodox economics never had to deal with competition between humans and machines.
  • The sun never sets on Eton’s empire – “Controversy over the school reflects the increasing polarisation between rich and poor.”
  •  Einstein’s Lost Theory Discovered … And It’s Wrong – “Faced with evidence the universe was growing, Einstein apparently wanted to figure out why it wasn’t filling up with empty space. His proposed solution is in this newly discovered paper. As the universe expanded, he suggested, new matter showed up to fill the gaps. New stars and galaxies would just pop up, according to Einstein’s model, so that even as the universe grew, it would look the same. Just to be clear, this theory is totally wrong. But for a little while Einstein thought it was right. The numbers made sense, because he had made a mathematical mistake. In the middle of a complicated calculation, he wrote a minus sign where he should have written a plus.”
  • Half Of Americans Believe In Medical Conspiracy Theories – “Despite evidence to the contrary, many Americans believe cellphones cause cancer and that health officials are covering it up. Discredited theories about vaccines and fluoridation also remain popular.”