Updated: September 12, 2017
America’s got talent! I tend to think of military intervention as a last resort and to be avoided. But there is a five-step-program sense in which military intervention might be appropriate here. Randy, we have gathered all your friends here because we love you and want to stop you embarrassing yourself with such weak behavior. Perhaps you could get a job in the private sector? The internet is forever “lads.” Ew.
Noah Feldman goes after Senator Feinstein for anti-Catholic bias in her questioning of a potential judge. According to Feldman, Feinstein hinted that American Catholics’ first allegiance might not be to the USA its constitution. It must be the distorting influence of AIPAC, the American Irish Political Action Committee! The argument resonated with me because, as the joke goes, I don’t believe in God, but I’m sure as hell a Catholic. I would add only that I don’t believe in the church either. Anyhow, a much better argument would have been that while Catholics are fine, there are already far too many of them on the Supreme Court already. I like beer, but realize it should not be the only item in your diet. In fact, the ruling right-wing conservative junta has long been wall to wall papist, with Gorsuch just extending the pattern. It is almost like SCOTUS stands for Several Catholics of the United States. So rather than dissing Catholics, the much more polite thing to do would be to insist on more Jews, Congregationalists or — best yet — atheists.
Brad Delong takes Michael Boskin to task for lying about easily-confirmable facts from the early 1990s. (Sorry the link is to Delong’s site and not to the post specifically.) I admire Delong for being willing to wade through this stuff. But I am not so sturdy. Instead, I wonder why guys like Mike Boskin would need to lie like this. I get ideology: have some of that myself. I also get lying if that is required to feed your family. But why do these established guys put so little weight on their dignity? Is seventy-something Mike Boskin, prosperous and still respected, expecting some sort of reward for staying on message? I don’t get it. Partisanship is the easy answer. But why so strong? Weird.
I enjoyed this piece from Barry Ritholtz reviewing The Unpersuadables, a book from 2014 covering, among other things, how evolution has selected for some traits that might not work so great (Ritholtz adds) in financial markets. The ideas are not new, but Ritholtz tries to link them to investing in a way that seems sensible, if not particularly conclusive. I’ll probably pick that book up. My only pushback is that Ritholtz, or maybe his editor or illustrator, buys into the wrong view that evolution is “progress.” It ain’t. Environments change and with them the species best adapted to survive. There is one thing that Ritholtz did not mention that I will. Behavioral finance type errors aside, I really suspect that some fund managers are suited to some environments and not to others. For the past decade, global macro funds have sucked air. I doubt the people there got stupid or that their luck ran out. The environment changed is all. They blame QE for having distorted everything, which is funny, because that is only evidence that they are not now seeing it. Still, to me, you can hold your head high if you killed it when you saw it and then did not later get killed by it. Guys like that still have claim to have beat the EMH. I dunno. I think that is a fun thought, even if totally wrong!
From Economist’s View (a source I use often), I see that Tim Duy has a blog post debunking the idea that a surplus of multiple job holders is evidence that the labor market has not really approached full employment. Tim’s contribution is to point out that the number of multiple job holders is actually quite low when expressed as a ratio to total employment (or the labor force, I would add). Surely, this is tied for the easiest debunking of macro BS achieved this quarter. I have often noticed the utter lack of quality control on Wall Street. Explains the first 5 years of my career — plus 08! One bit of free advice to Tim, though. Just because there are dumb arguments for X circulating does not mean that X is untrue. In 08, I was pretty expert on why MEW was not the main driver of consumption. Spent a lot of time documenting that, which would have been better spent looking into the CDO tower of doom.
Bloomberg has a long piece describing the business culture over at my Westport neighbors, Bridgewater. I will spare you the discussion of “Principles”, but this anecdote is pretty fun and the concluding parenthetical part reminds me for some reason of Kim Jong Un, who is also in the news. “One former employee, who left after less than two years and would speak only on the condition of anonymity, recounted a Maoist-like struggle session where a young male employee was berated by a group of peers and superiors for not being good enough. Instead of helping him improve or getting rid of him, they needed to “get in sync” about the employee’s perceived inadequacies, he says. The encounter ended, he adds, with the man firing himself. (Bridgewater says it isn’t familiar with this episode and that in its most recent quarterly employee survey, 99.4 percent of respondents said communication is open and honest and their manager cares for them in a way that’s meaningful and genuine.)” The employees later went on all to shoot 17 holes in one at the civic golf course, Longshore.
I learned some nice history from Cass Sunstein‘s “plain answer to the Trump pardon question.” In particular, Sunstein relates an exchange between Madison and Mason seeming to prove that the Framers took a dim view of the president pardoning those whose crimes he may have “advised.” Seen in this light, Donald Trump ought not pardon his co-conspirators. That would be against the spirit of the constitution, in Sunstein’s view. But I think Sunstein’s historical account actually drives at a conclusion that is opposed to the one he favors. If you read his piece carefully, you will see that Madison tried to comfort Mason on his fear of abuse of the pardoning power by assuring Mason that in the event of such an abuse the ability of Congress to impeach would provide the obvious remedy. This raises two important points, the first of which Sunstein glosses over. Re the first, Sunstein is implying that Madison — whom he takes to be authoritative on this issue — accepts that there is no constitutional constraint against abusing the right of pardon, except that of impeachment. Clearly, that puts him much closer to Trump apologists than to, say, for example, Laurence Tribe who rejects that the legal right of pardon is absolute. Second, and more as a point of context, if Sunstein is right about Madison and if Madison is in fact authoritative, then this is quite a failure of foresight on behalf of the Framers, who are meant to have been so prescient. Clearly, James Madison could not have foreseen — and did not foresee — a Congress so utterly devoid of concern for limited government as the current GOP version. And speculating wildly, well beyond my competence, I would say that you can’t mostly blame Congress for the current malaise. The American people themselves are being recklessly indifferent to the survival of their constitution. Another Framer, Ben Franklin, warned famously that the US might not be able to keep its republic. That guy had vision!
Slate runs a piece discussing how Democrats are getting all hot and bothered these days over military types. It is hard to attack the Democratic candidate for being (typically) “effete” if she can land an F-18 on an aircraft carrier and has done bombing raids over Iraq and Afghanistan, etc. In my view, there are two things going on here. First, it is a sad comment on the current political culture that prospective supporters of either major party, including the one on centre/centre/left, believe that military types are uniquely qualified to comment on policy and to govern. It seems this has long been a strand in US politics, even though it is contrary to the spirit republicanism and civilian government. But it seems stronger now. Second, the Democrats want to take back Congress. Doing so may require dealing with the country as it actually is, rather than as it might be in some ideal state. The country needs urgently to weaken Republican control, so I say by all means — win. But this taste for genteel fascism, even among Democrats, is a sad comment on the country and a bad omen.