A financial bond or note is a promise to pay some fixed amount at some given date. Two things, beyond the promised amount of payment, determine the price of a such an instrument.

First, there is the associated danger of a default. A possibility of default turns the bond or note into a sort of lottery, in which the actual pay-off could be the full, promised value, or nothing, or anything in-between (at least, anything reaizable in terms of the minimum division of the payment), or even some new pledge, promising a later payment of some sort. Each of these outcomes has some associated plausibility, and the lottery is valued accordingly.

Second, there is also the fact that the instrument is a promise of future payment; since pay-off cannot itself be put to immediate use (as consumption or as investment), its price is discounted to reflect time-preference and the forgone productivity of assets used to buy it.

Just to get the gist of that clearly, imagine that the value of a lottery were simply that of the mathematical expectation of its pay-off. The price of a bond would then be discounted expected pay-off.

So far, the causality here is just flowing one way. Possible-pay-offs and their probabilities determine an expectation or something like that, and then time-preference and productivity determine the present value of that expectation or expectation-like value, and that's the price of the instrument. And if the pledge were issued by a private institution, that would generally be it.

On the other hand, when such instruments are issued by a state, politics can make things interesting.

The Greek state is going to default on repayment of its borrowing. Its citizens are simply not willing to accept the costs to them of full repayment. In fact, they're not willing to fully repay what remains after politically possible subsidies from other states. Those who have lent money to Greece will receive less than they were promised.

The price of bonds issued by the Greek state already reflects the expectation of default. This reduced price is going to be used against bond-holders, both against those who are paying it now, and against those who paid a higher price and have held onto their bonds even as value dropped (as they gambled that the Greek state would not default or at least not default as much as some expect). What will happen is that populists, anti-rentiers, and opportunists will argue as if all bond-holders had paid that steeply discounted price, and as if those who paid that price lose nothing if they only recover the nominal purchase price.

And what makes that interesting is that it means that causality should now be flowing cyclically, where present price pronouncèdly affects the relative plausibilities of possible pay-offs, even as these continue to affect present price.

I've not sat down to work-out a formal model. But, while I don't expect that the equilibrium price of a Greek bond would be zero, I don't know that one can rule that out. (On the other hand, while economic equilibria are useful in understanding and approximating, the world is never in equilibrium.)

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I do think that something might be said here about the ethics of sovereign debt.

It isn't heads of state or of government, or treasurers, or legislators as such who repay this debt. It isn't voters as such who pay-off this debt. It is tax-payers as such who pay-off sovereign debt (except where it is paid by selling assets such as territory and state enterprises). Sometimes the tax-payers weren't even born when the state went into debt. Moral claims against them for repayment are thin at best. I once read buying sovereign debt compared to buying shares in pirate ships (which one could at one time do openly in some places, and can still do quietly in some places), and I think that comparison quite apt.

On the other hand, it is plain that most of the Greeks protesting against austerity measures are signally unconcerned about the welfare of the Greek tax-payer; they just want any resources drawn from him or her to be directed to them.

If one wanted to know the solution to particular mathematical problem, and found that different groups gave different answers, then it might be interesting to hear or to read what each group said about the motives of rival groups, but one really ought to chose which answer or answers were correct based upon principles of mathematics, rather than based upon which groups seemed most noble. If one lacked the competence to decide the issue based upon principles of mathematics, then it would probably be best to resist coming to any decision if at all possible.

Likewise, if one wanted to know the solution to a particular problem of the natural sciences, but found that different groups gave different answers, then it might be interesting to hear or to read what each group said about the motives of rival groups, but one really ought to chose which answer or answers were correct based upon principles of science, rather than based upon which group seemed most noble. If one lacked the competence to decide the issue based upon principles of science, then it would probably be best to resist coming to any decision if at all possible.

And if one wanted to know what sort of social policy ought to be applied to some case, but found that different groups gave one different answers, then it might be interesting to hear or to read what each group said about the motives of rival groups, but one really ought to chose which answer or answers were correct based upon principles of science in combination with rational criteria for evaluating ethical philosophies (if, indeed, those criteria are not themselves scientific). And if one lacked the competence to decide the issue based upon such principles, then it would probably be best to resist coming to any decision if at all possible.

Now, all of that ought to be obvious; but consider how much pundits and the major media focus on personalities and theories of motive when it comes both to policy and to science applicable to policy, and how little real science and how little careful dissection of philosophical case is presented. If one party wants one thing, and another wants something different, then we are given some tale of the nobility or at least the level-headedness of one group, and of the knavery or foolishness of the other; accompanying this narrative will be cartoon physics, cartoon biology, or cartoon economics. If ethics are relevant, then one might get cartoon philosophy of ethics, or some ethical philosophy might be implicitly imposed, as if no rival philosophy were conceivable. (If something is treated as good, there generally ought to be an explanation somewhere of what makes it good. If something is treated as bad, there likewise ought to be an explanation of what makes it bad.)

This practice is so prevalent because so many listeners and readers unthinkingly accept it. And I'm not just talking about low-brow or middle-brow people. The self-supposed high-brow folk, more educated and ostensibly more thoughtful, accept this practice. Most of the people who would, if they read them, say that the previous four paragraphs were trivially obvious accept this practice. I don't simply mean that they don't cancel subscriptions or write angry letters to the editor; I mean that they allow their own beliefs to be shaped by some group engaging in the practice. They fall into attending to one narration of this sort, and let it guide them until and unless some crisis causes them to turn their backs on it, at which point they almost always begin to be guided by a narration using the same basic practice to advance some different set of policies.

Sometimes, one must make a decision, with nothing upon which to go except the discernible motives of conflicting parties. In those cases, one should bear in mind that, except to the extent that they are reporting brute fact (rather than interpretation), one typically learns more about the narrators themselves from what they say (and avoid saying) of their opponents, than one learns about their opponents. (And one should not allow the emotional appeal of a narrative to lead one to pretend that one must make a decision that one can in fact defer.)

When I'm required to provide a working e.mail address for a relationship with an institution, I usually creäte a new address, specific to my account with that institution. The address itself is typically that of a forwarder, and that forwarder is almost always to an address whose sole purpose is to receive the e.mails from these various forwarders.

One benefit of this arrangement is that, if I want to disconnect from that institution, I can delete the forwarder. But my real concern has been control of spam. If I receive spam, then from the address of the forwarder I can determine which institution provided my address to the spammers; and I can cut-off the spammers by deleting the forwarder.

This morning, I received three pieces of spam, each with the title UPS notification, each ostensibly from UPS, and each with a body

Dear customer.


The parcel was sent your home address.
And it will arrive within 3 business day.

More information and the tracking number are attached in document below.

Thank you.

Copyright © 1994-2011 United Parcel Service of America, Inc. All rights reserved.

(Anti-spam software on the mail-server removed any attachment.) Many of you will have got e.mail similar or identical to this; it's a trick that has been employed now for years.

But what is of particular interest is that each of these three messages came to the address that I'd provided exactly and only to Fred Flare .com. So Fred Flare has allowed some or all of my account information to be leaked to some party who tried then to hijack my computer.

Upon discovering the first two, I quickly tried to contact Fred Flare. My first attempt failed because their own filters prevent the delivery of attachments, and I'd attached copies of the spam. My second attempt therefore omitted these, which potentially compounds the problem for Flare.

In my case, I can just delete the forwarder once I'm done communicating with Fred Flare, but other, more trusting people provided their principal e.mail addresses. It would be no small task for Fred Flare to make it right for those people, but it is the responsibility of Fred Flare to do so.

Having got my sleeping schedule out-of-synch with most of the world around me, I slept from early Monday after-noon into Monday night. One of my bedroom windows, which (from a third floor) faces onto the street, was open.

At some point, I caught a bit of conversation between a young woman and young man as they walked past. She, crying, was pregnant. And, from his tone and from what he said, it seemed that the young man loved her, but was far, far too weak to handle the situation well.

Whether a decision as such is good or bad is never determined by its actual consequences as such.

Decisions are made before their consequences are reälized (made actual). Instead, decisions are made in the face of possible consequences. There may be an ordering of these consequences in terms of plausibility, in which case that ordering should be incorporated into the making of the decision. Most theories even presume that levels of plausibility may be meaningfully quantified, in which case (ex hypothesi) these quantifications should be incorporated into the process. But even in a case where there were only one outcome possible, while the decision could (and should) be made in response to that unique possibility, it still were possibility of the consequence that informed the decision, and not actuality. (Inevitability is not actuality.)

When the reälized consequences of a decision are undesirable, many people will assert or believe that whoever made the choice (perhaps they themselves) should have done something different. Well, it might be that a bad outcome illustrates that a decision were poor, but that will only be true if the inappropriateness of the decision could have been seen without the illustration. For example, if someone failed to see a possibility as such, then its reälization will show the possibility, but there had to have been some failure of reasoning for a possibility to have ever been deemed impossible. On the other hand, if someone deemed something to be highly unlikely, yet it occurred anyway, that doesn't prove that it were more likely than he or she had thought — in a world with an enormous number of events, many highly unlikely things happen. If an event were highly unlikely but its consequences were so dire that they should have been factored into the decision, and yet were not, the reälization of the event might bring that to one's attention; but, again, that could have been seen without the event actually occurring. The decision was good or bad before its consequences were reälized.

A painter whose canvas is improved by the hand of another is not a better painter for this, and one whose work is slashed by a madman (other than perhaps himself) is not a worse painter for that. Likewise, choosing well is simply not the same thing as being lucky in one's choice, and choosing badly not the same as being unlucky.

Sometimes people say that this-or-that should have been chosen simply as an expression of the wish that more information had been available; in other cases, they are really declaring a change in future policy based upon experience and its new information. In either case, the form of expression is misleading.

Some readers may be thinking that what I'm saying here is obvious (and some of these may have abandoned reading this entry). But people fail to take reasonable risks because they will or fear that they will be thought fools should they be unlucky; some have responded to me as if I were being absurd when I've referred to something as a good idea that didn't work; our culture treats people who attempt heinous acts but fail at them as somehow less wicked than those who succeed at them; and I was drawn to thinking about this matter to-day in considering the debate between those who defend a consequentialist ethics and those who defend a deöntological ethics, and the amount of confusion on this issue of the rôle of consequences in decision-making (especially on the side of the self-identified consequentialists) that underlies that debate.

This morning, I went to the website of NBC New York, to read a news story and a promo on the right-hand side of the page caught my eye: So NBC not only expects that I would enjoy reading about the mutilation of these people, but openly caters to such presumed enjoyment, and encourages its readers to indulge in it.

I am not aware of any reason that I should find gratification here.

I'm not a fan of cosmetic surgeory except to effect some bona fide reduction of injury. Most cosmetic surgeory instead represents an falsification of youth, of health, or of preferred genetic endowment, and does so at a cost of lasting (though perhaps concealed) injury. Nor am I a fan of celebrity (a creätion of journalism, with its need for material), nor of most celebrities, who are, as the saying goes, well-known for being well-known, and rarely arrive at their status by by virtue of desirable character traits. And, sure, to some extent, virtually every one of these people has brought it on themselves, but so would most other people if given a chance.

Celebrities did not and could not elect themselves to celebrity; for all the celebrities out there, there are many more people who try for it and fail, and an even greater number who simply wish for it to be thrust upon them. And whatever one might claim about actual celebrities wasting the opportunities that they are given, my experience of other people convinces me that a share as great or greater of the wannabe celebrities would make as much a mess if they had those opportunities. If I should wish ill upon the actual celebrities, I should wish it upon most of humankind.

Nor is cosmetic surgeory driven by vanity or by insecurity just an indulgence of the famous. If I flip through an issue of the local weekly, I find plenty of advertisements for such procedures, and I'd be rather surprised if NBC New York weren't selling commercial time to plastic surgeons. I certainly see plenty of women with utterly unnatural breasts, and occasionally see ruined noses or lips. I'm not sure what I'd find at the beach, but it probably wouldn't be pleasant. Some of the rich may keep going in surgical self-destruction, but many of these other folk have merely run short of funds and of collateral.

There's nothing new in the proposition that envy, sadism, or a lack of empathy will cause some people to indeed enjoy reading about plastic surgeory gone especially wrong, and looking at images of the results. But our culture has coarsened; the presentation and enjoyment has been moved into the mainstream. Bad enough that, for some, it's a pleasure; now it's a pleasure without a sense of guilt or even of shame.

Although I'm something of a fan of E[lzie] C[risler] Segar, what I like most when it comes to Popeye are the animated cartoons made by the Fleischer Studios, before they relocated to Florida. (Some years ago, the Woman of Interest got me a copy of Popeye the Sailor: 1933 – 1938, which was exactly the perfect collection for me.)

Anyway, I thought that I'd present my single favorite bit from those cartoons: For a better sense of what is happening here, watch Popeye the Sailor Meets Ali Baba's Forty Thieves (1937), or at least the minute and 48 seconds starting at 6:12.

Popeye and Olive and Wimpy are the restaurant of an oasis village, when there is a warning that Abu Hassan and his band of forty thieves are out on a raid. The villagers go into hiding (as does Olive). Indeed, the thieves approach this very village. Popeye hears a great commotion outside, leaps from his stool, and begins pumping his fists.

Popeye the Sailor Meets Ali Baba's Forty Thieves is, over all, not actually my favorite Popeye cartoon — which, off the top of my head, might instead be Popeye the Sailor Meets Sindbad the Sailor (1936), though I'm not sure — but this one bit is perfect. Popeye isn't sure what he's about to confront, but he's prepared to fight it! Popeye is emotionally prepared to fight anything,[1] and he expects to do so with his fists!

Popeye is, in important respects, a simple man. He has many apparently unexamined certitudes, leaps to conclusions, and often does things that are very inappropriate. And he knows that he's simple; that's part of what he's saying with I yam what I yam and that's all what I yam! Popeye doesn't typically think his way out of a problem; it doesn't even seem to occur to him to try. If thinking were suggested to him, then he'd probably confess that he couldn't. He uses his fisks 'cause that's what he's gots. And, ultimately, they've always seemed to be enough.

But, in the moral sphere, he is consistently doing his very best. Not just what others might see as enough, but his best. I yam what I yam and that's all what I yam! isn't used to rationalize shirking. Popeye is prepared to fight whatever comes through that door because, if it's bad, somebody has to fight it; and, if Popeye doesn't fight it, well, then who will?

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BTW, on Thursday, I received copies of the first three volumes of the Fantagraphics Popeye reprints from Edward R. Hamilton, mentioned in a previous entry; they had no remainder marks. (And the transaction seems otherwise to have been perfectly satisfactory.)

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[1] Except in-so-far as he has no personally acceptable means by which to fight a woman.

Some time within the last several weeks, I finally got around to reading The Secret Agent (1907), by Joseph Conrad. The novel is interesting for a number of reasons. One of those is that, as with Heller's later Catch-22, events are driven by the characters' unquestioned misunderstandings one of another, and by terrible narrowness of vision. (Unlike Catch-22, Conrad's book is not particularly humorous in its beginnings.) But what most struck me about The Secret Agent is that Conrad identified and unsparingly depicted the mental process that leads most who turn to state socialism to do so, and what essentially propels most of those who proceed on to left-wing anarchism to do that.

One of the characters of The Secret Agent is Stevie. Stevie is a low-functioning young man; operationally a person of very limited intelligence. He is also someone who is concerned — often overwhelmed with concern — about the fate of people and of beasts who seem to be ill-treated. Stevie's concern is illustrated at various points in the story, but it is in Chapter VIII that they begin to take political form.

Stevie's mother, over the objections of her daughter, has had herself moved to an alms-house; Stevie and his sister, Winnie Verloc, see their mother to her new home. The cab-man drives a much-abused horse to pull his carriage, and responds to Stevie's imploring that the horse not be whipped as if it were nearly incomprehensible. But, after the move has been effected, the cabbie tells Stevie that, however hard life may seem to be for the horse, it is harder still for the cabbie, who is a poor man with a family. Stevie is moved by this information. The driver departs.

Stevie is rejoined by his sister; they begin the journey homeward.

Before the doors of the public-house at the corner, where the profusion of gas-light reached the height of positive wickedness, a four-wheeled cab standing by the curbstone with no one on the box, seemed cast out into the gutter on account of irremediable decay. Mrs Verloc recognised the conveyance.[1] Its aspect was so profoundly lamentable, with such a perfection of grotesque misery and weirdness of macabre detail, as if it were the Cab of Death itself, that Mrs Verloc, with that ready compassion of a woman for a horse (when she is not sitting behind him), exclaimed vaguely:

Poor brute!

Hanging back suddenly, Stevie inflicted an arresting jerk upon his sister.

Poor! Poor! he ejaculated appreciatively. Cabman poor too. He told me himself.

The contemplation of the infirm and lonely steed overcame him. Jostled, but obstinate, he would remain there, trying to express the view newly opened to his sympathies of the human and equine misery in close association. But it was very difficult. Poor brute, poor people! was all he could repeat. It did not seem forcible enough, and he came to a stop with an angry splutter: Shame! Stevie was no master of phrases, and perhaps for that very reason his thoughts lacked clearness and precision. But he felt with greater completeness and some profundity. That little word contained all his sense of indignation and horror at one sort of wretchedness having to feed upon the anguish of the other—at the poor cabman beating the poor horse in the name, as it were, of his poor kids at home. And Stevie knew what it was to be beaten. He knew it from experience. It was a bad world. Bad! Bad!

Mrs Verloc, his only sister, guardian, and protector, could not pretend to such depths of insight. Moreover, she had not experienced the magic of the cabman’s eloquence. She was in the dark as to the inwardness of the word Shame. And she said placidly:

Come along, Stevie. You can’t help that.

The docile Stevie went along; but now he went along without pride, shamblingly, and muttering half words, and even words that would have been whole if they had not been made up of halves that did not belong to each other. It was as though he had been trying to fit all the words he could remember to his sentiments in order to get some sort of corresponding idea. And, as a matter of fact, he got it at last. He hung back to utter it at once.

Bad world for poor people.

Directly he had expressed that thought he became aware that it was familiar to him already in all its consequences. This circumstance strengthened his conviction immensely, but also augmented his indignation. Somebody, he felt, ought to be punished for it—punished with great severity. Being no sceptic, but a moral creature, he was in a manner at the mercy of his righteous passions.

Beastly! he added concisely.

It was clear to Mrs Verloc that he was greatly excited.

Nobody can help that, she said. Do come along. Is that the way you’re taking care of me?

Stevie mended his pace obediently. He prided himself on being a good brother. His morality, which was very complete, demanded that from him. Yet he was pained at the information imparted by his sister Winnie who was good. Nobody could help that! He came along gloomily, but presently he brightened up. Like the rest of mankind, perplexed by the mystery of the universe, he had his moments of consoling trust in the organised powers of the earth.

Police, he suggested confidently.

And there one has it. A great many of us would agree that the world is economically harder on many people than it ought to be. A great many of us would agree that society ought to do something about it. But the typical state socialist just unthinkingly grabs for the first social institution that comes to mind, the State; or, as Stevie puts it, police. There's no real thought to what other institutions might be more appropriate. If the point that we are talking about an institution that is first-and-foremost about violence is considered at all, there is little reflection on the question of whether and when violence is appropriate, unless that consideration is to rationalize the conclusion that violence should be used after the conclusion was already implictly embraced. But Stevie isn't drawn to wrestle with the a theory of what ought to be the limits of the State or of the use of violence:

The police aren’t for that, observed Mrs Verloc cursorily, hurrying on her way.

Stevie’s face lengthened considerably. He was thinking. The more intense his thinking, the slacker was the droop of his lower jaw.[2]

And it was with an aspect of hopeless vacancy that he gave up his intellectual enterprise.

Not for that? he mumbled, resigned but surprised. Not for that? He had formed for himself an ideal conception of the metropolitan police as a sort of benevolent institution for the suppression of evil. The notion of benevolence especially was very closely associated with his sense of the power of the men in blue. He had liked all police constables tenderly, with a guileless trustfulness. And he was pained. He was irritated, too, by a suspicion of duplicity in the members of the force. For Stevie was frank and as open as the day himself. What did they mean by pretending then? Unlike his sister, who put her trust in face values, he wished to go to the bottom of the matter. He carried on his inquiry by means of an angry challenge.

What for are they then, Winn? What are they for? Tell me.

Winnie disliked controversy. But fearing most a fit of black depression consequent on Stevie missing his mother very much at first, she did not altogether decline the discussion. Guiltless of all irony, she answered yet in a form which was not perhaps unnatural in the wife of Mr Verloc, Delegate of the Central Red Committee, personal friend of certain anarchists, and a votary of social revolution.

Don’t you know what the police are for, Stevie? They are there so that them as have nothing shouldn’t take anything away from them who have.

She avoided using the verb to steal, because it always made her brother uncomfortable. For Stevie was delicately honest. Certain simple principles had been instilled into him so anxiously (on account of his queerness) that the mere names of certain transgressions filled him with horror. He had been always easily impressed by speeches. He was impressed and startled now, and his intelligence was very alert.

What? he asked at once anxiously. Not even if they were hungry? Mustn’t they?

The two had paused in their walk.

Not if they were ever so, said Mrs Verloc, with the equanimity of a person untroubled by the problem of the distribution of wealth, and exploring the perspective of the roadway for an omnibus of the right colour. Certainly not. But what’s the use of talking about all that? You aren’t ever hungry.

Although it is plainly explained that Winnie is not really out to express a Machiavellian theory of the state, she has done so. Actually, many people from many otherwise very different ideologies would embrace this theory of what the State actually does; many anarchists (and not just left-wing anarchists) would insist that the State is at best unnecessary to all but those who would use to effect or to sustain an unjust distribution of economic power. But, in Stevie's case, in a matter of minutes he's invented state socialism, and then had his statism but not his socialism contradicted, and so heads down a path to left-wing anarchism. Someone else will later help him further down that path.

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[1] The poor driver has taken his meager pay not home to his family, but to a pub. Earlier, it is revealed that a scrub-woman frequently plays upon Stevie's desire to help her and her family, only to spend on alcohol the money that he gives to her. Perhaps Conrad was inclined to believe that Work is the curse of the drinking classes. or perhaps he meant no more than to emphasize Stevie's gullibility. In any case, the interpretation is separable from what I seek principally to note.

[2] Note that Conrad has written Stevie as quite literally a slack-jawed fool.

After one votes in California, one is offered a sticker announcing that one has done so. In my area, the stickers are typically available in English, in Spanish, and in Vietnamese. I ask for one in Vietnamese.

There are people who want English to be constitutionally declared to be the language of America; they are stunningly wrong.

Of most immediate importance, they are wrong because, whenever anything is made a matter of law, it is made a matter of force; behind any law is ultimately a gun. There are times for laws because there are times for force; there are times for guns. But language choice is not such a time. I have only contempt for someone who claims that there is a symmetry between being forced to speak the language of a merchant because he will not transact in another language and that merchant being forced by the state to transact in some other language, or official proceedings being legally restricted to a language utterly alien to important parties. (And my contempt extends to those who would force the use of minority languages, as well or instead of majority languages.)

Perhaps of even greater long-run importance, if a language is made an official language, the state is thereby empowered to determine whether this-or-that communication conforms to that language, which is to say that control of a language is seized by the state when the language is made official. The state develops the power to decide its grammar and its vocabulary.

America was given a foundation, however imperfect, of classical liberalism. It represents a gross violation of that foundation to tell people in what language they must express themselves, and a gross violation of that foundation to offer-up control of one of our languages to the state.

One of our languages. English is one of our languages; there are others. Any language spoken by an American is an American language. (And any name held by an American is an American name.) And there are people who don't know English who are far better Americans than those who would give that language a legally privileged position.

Catching shill-bidders on eBay used to be one of my hobbies. I would regularly stumble-upon suspicious confluences, start examining auction and bidder histories, and from them often assemble proof that there had been shill-bidding, which proof I would then send to eBay and to the victims. I'm sure that I wasn't the only person engaging in this sort of detection.

But eBay began choking-off the data available to us. With decreasing information, it became ever harder to make the case. It became impossible even to see some of the confluences that would have triggered suspicion in the first place.

For an honest auction firm, there may be an optimal amount of shill-bidding to allow, simply because of enforcement costs. (A perfectly secure trading environment would be prohibitively expensive.) But for a dishonest firm the question is of balancing the gain that otherwise comes from allowing ending prices (and hence fees) to be thus increased, against the alienation of users who consequently reduce their spending. Access to information which both empowers volunteers to catch shill-bidders and alerts users more generally to the occurrence of shill-bidding is, as such, not in the perceived interest of a dishonest firm.

BTW, the changes that reduced our abilities to spot shill-bidders, and which made it more typically impossible for us to prove a case of shill-bidding (as well as other changes that enabled eBay to be more easily used by thieves) were primarily effected while Margaret Cushing (Meg) Whitman, now the Republican Party nominee for governor of California, was eBay's President and CEO.