Paul Krugman walks into a bar, and asks How much for a scotch, neat? The bartender looks at him, and thinks What could a Keynesian know about money? So he says One trillion dollars. Krugman gets on the phone, calls the Fed and the White House, and they send over $1 trillion. As Krugman is drinking, the bartender remarks You know, we don't get many Keynesians in here. Krugman replies Well, with these prices, it's no wonder!

[This post was delayed from yester-day, as my hosting service had a technical failure, and it took me rather a long time to persuade them of such.]

I read

This past week it was reported that the hacktivist collective known as Anonymous claimed credit for taking offline over 40 websites used for sharing pedophilia — and for exposing the names and identifying information of more than 1500 alleged pedophiles that had been using the sites.

But the actual list is of user aliases, not of personal names.

Not only are pædophiles not being exposed here, but non-pædophiles who've had the misfortune of pædophiles' using the same aliases (by chance or from malice) are going to come under suspicion by those who think that they recognize them on this list.

Further, if agents of law enforcement were themselves working to track-down the actual legal identities of the pædophiles, their investigation has now been severely compromised, possibly fatally so.

Once again, Anonymous has done less good than they have led the gullible to believe, and have caused more damage than they have acknowledged.

A recent comment by Zenicurean notes, implicitly, that economic pædagogy often uses a widget as a hypothetical economic good.

I most frequently use the veeblefetzer (borrowed from Harvey Kurtzman) when I want a good about which the audience will know little or nothing, and the hot dog when I want a good that will seem familiar.

I like the hot dog as an example in part because it has a long tradition in economic education while being fairly absurd as an artifact.

I also like it because it is easy to explain the idea of a shift in the demand curve using the hot dog. First, I present my students with a set of prices, polling them as to how many hot dogs they would buy at each of these prices; that gives us an initial demand curve. Then I discuss some of the things that are permitted to go into hot dogs, and we repeat the process for the prices. (So far, the demand curve has always shifted inwards.)

But the main reason that I like to use hypothetical hot dogs is because I think back to a question on the economics GRE when I took it.[1] In the set-up for the question, a family was working-out its annual budget, and decided that they would spend $800 per year on hot dogs, regardless of the price of hot dogs.[2]

The question was of what sort of demand elasticity were here displayed. Elasticity is a measure of sensitivity or responsiveness, with a general form of

or of (Whether there's a negative sign and whether an instantaneous form is used is based on what's convenient and practicable.) In the case of demand elasticity, the y is quantity demanded, and the x is unit price. One might think that demand responsiveness could be measured more simply by slope (Δy/Δx or dy/dx), but elasticity has a useful property. When elasticity is less than 1 in absolute value, responsiveness is sufficiently weak that expenditures (the product of quantity demanded and unit price) increase as price is increased; whereäs if elasticity is greater than 1, responsiveness is sufficiently strong that expenditures shrink as price is increased. The seller gets less revenue by increasing prices in the second case, where the curve is said to be elastic (sensitive); the seller gets more revenue by increasing prices in the first case, where the curve is said to be inelastic (insensitive).

If the elasticity is exactly 1 (in absolute value) then quantity demanded drops or rises to exactly off-set any price change; expenditures are constant as price changes. This is called unit elasticity. (BTW, a demand curve that is everywhere unit elastic will be a hyperbola.)

On the GRE, I was supposed to identify the demand curve of the family in the question as unit elastic, and so I did. But, because I'm not autistic, I was also greatly amused by this example. Imagine a family that is conscientious enough to budget, but they eat hot dogs. Imagine a family that budgets, but budgets such that if a hot dog costs $1600 then they will try to buy half a hot dog, and if a hot dog costs a penny then they will buy eighty thousand g_dd_mn'd hot dogs!

I laughed when I read this question. And, because I made multiple passes through the test, I glanced at that question repeatedly, laughing each time. I was the only person in room laughing. (The room had people taking different subject GREs, and I may have been the only one taking the economics test.)

When I use hot dogs as an example, it's mostly just in fond memory of that hypothetical family, crazy for hot dogs.

---

[1] This tale may seem somewhat familiar to those who read my now long-since-purged LJ.

[2] The amount may have been $600 per year, or perhaps $400 per year; it has been quite some time since I took that test, and I don't remember. But, mutatis mutandis, my remarks hold.

eBay lot #180729964545 sold on 26 September 2011 for a price of $1000 plus $140 for s&h. Categorized in Collectibles > Advertising > Food & Beverage > Cereal > Kellogg, the listing was entitled 1,000 Widgets. The description said only 1000 Widgets (omitting the comma). There was no picture. Two days later, the buyer left feedback declaring good widgets. thanks.

On 6 October, another 1000 widgets were allegedly sold as lot #180734234607, again for a price of $1000, but this time with $197 for s&h. The purchasing account left a feedback on 11 October that simply says acceptable.

The buying account is shared by Joshua Glew and his father, Steven John Glew. The latter has a 'blog that seems to relate some dirty doings by the Pez Corporation, but which I've done no more than skim because it's written in a decidedly ill-organized fashion.

A thousand widgets?

Fred Flare, Inc, has received the not-so-coveted rating of F from the Better Business Bureau.

Readers may recall my entry of 12 August on how Flare had allowed some of the information that I'd provided to them to be used by spammers. (I had creäted an e.mail address exactly for business with Fred Flare and provided it uniquely to them.) Not long after I'd posted that entry, I contacted the BBB; Flare should have been responding to the issue of a hacked customer dB with a sense of urgency, but there was no evidence of such a sense.

On 6 September, a representative from Flare commented to the 'blog, and also sent e.mail:

Please forgive our late response to customer complaint #8703538 from Daniel Kian M cKiernan.
We are investigating whether our email service provider iContact might have been hacked.
We haven't found any evidence confirming this as of yet but are being extra thorough.
Rest assured, no credit card information has been compromised. We DO NOT save cc details for that very reason.
I will update you as I learn more. Thank you for your patience.

Now, as I implied in reply to the 'blog comment, the theory in that comment casting suspicion on UPS is a poor one. There's no particularly good reason for the spammer to spoof the name of their source (indeed, there is good reason for them not to do this), other spam from this breach spoofs other senders, and UPS (along with FedEx and DHL) has for many years routinely been spoofed by spammers.

The second theory (that in the e.mail) has some plausibility, but was, at that point, just a theory.

The promise (in the 'blog comment) of More soon! went simply unfulfilled. Meanwhile, spam continued to be sent to the address, at least one piece using my full name.

When the BBB dead-line for communication from Flare was imminent, they sent no more than a copy of that original 'blog comment and of that theorizing e.mail. The BBB, following SOP, asked me if this resolved my complaint, and I explained why it didn't.

What that communication did was reset the clock. But this time it just ticked-down to zero with no further communication from Flare, and the BBB regards such silence as unacceptable; hence the F

I don't know how the NYC BBB handles attempts at a ratings change; the San Diego BBB has been known to allow merchants to revive cases after many months (and known then to completely discard the rating if the customer does not respond). (If Fred Flare does not act on this case, it will eventually be considered sufficiently ancient as not to be used in rating.)

For my part, I guess that my next step is to file a complaint with the FTC. I don't know that a lot will come of that, though.

I'm really saddened by this whole course of events. There is no question that Fred Flare offers some cool and whimsical stuff that is difficult or impossible to get elsewhere; I think that they should be rewarded for that much even setting aside whatever desire I might have for any of that stuff, and ceteris paribus I would want such an enterprise to prosper.

But it's imperative, in these days where information once loosed flows so freely, to take responsibility for the databases that we keep of information on other people (including the addressbooks of our e.mail handlers). Mistakes will happen, but we need to own any mistakes that we make, and to off-set their effects.

I had hoped that I'd get a reply within hours after I'd first contacted Flare. I should have been quickly told (as I was eventually told) that no credit-card information had been released. And Flare still needs to do something for those victims who, unlike me, provided addresses that are not easily discarded.

If you’re actually trying to install another version of Firefox, then click on the Firefox tag, as there may be an entry on that other version.

While my back was turned, Mozilla released Firefox 7.0.x. The installation method that worked for Firefox 6.0 under Scientific Linux 6.0 and 6.1 works, mutatis mutandis, for Firefox 7.0.1 under Scientific Linux 6.1, and therefore ought to work for Firefox 7.0.x under RHEL 6.x and under CentOS 6.x.

So here are the steps that I recommend:

1. Download the archive, firefox-7.0[.n].tar.bz2.
2. The tarball contains a directory, firefox, which should be dropped-in as a sub-directory of something. If you want to ponder where, then study the FHS. As for me, as root, I put it in /opt:
   

   tar -xjvf firefox-7.0[.n].tar.bz2 -C /opt/

   (Omit that [.n] if it isn’t in the name of the archive that you downloaded. Replace it with the actual number from the name of the archive if such a number was included.)

3. You’ll need a .desktop file for Firefox (though you may already have one). As root, edit/create /usr/share/applications/firefox.desktop, ensuring that it reads
   

   [Desktop Entry]
   Categories=Application;Network;X-Red-Hat-Base;
   Type=Application
   Encoding=UTF-8
   Name=Firefox
   Comment='WWW browser'
   Exec='/opt/firefox/firefox'
   Icon='/opt/firefox/icons/mozicon128.png'
   Terminal=false

   (If you didn't install in /opt, or changed the name of the firefox directory, then you'll need to change the above accordingly.)

4. Restart the GUI, by logging out and back in or by restarting the system.

One claim about Libertarians that won't withstand any real scrutiny — yet is very common amongst journalists and educators — is that Libertarians don't believe in doing anything to address the immediate needs of the poor. If asked to defend the claim, those who make it will either note Libertarian opposition to various state programmes, and with a crude induction draw the inference that Libertarians don't believe in doing anything to achieve the ostensible goals of those programmes, or they'll note the Libertarian objection in principle to any state programme with such goals, and treat this as QED.

Well, let's lay the form of that out:

L does not believe that X should be done by S,
therefore
L does not believe that X should be done.

Oooops! That isn't really very logical, is it? I mean that we can find plenty of X and S where this won't work, when we make ourselves L.

Libertarians don't believe that the state should do a lot of things, including farming, financial intermediation, and managing roads. Genuine anarchists go further, to claim that the state shouldn't do anything. That hardly means that they don't think that these things should be done by someone. It doesn't even mean that they won't agree that they should be those who do these things. (Indeed, people who rely upon the state are most likely to say that it ought to do whatever it does at the expense of someone else, as when they call for higher taxes on those who make more money.)

This point of logic ought to be obvious. Well, many journalists and educators are such damn'd fools that they truly don't see it, and an awful lot are knaves, who see it but don't want it to be seen by others.

One way that I see the eristicism effected is by the specious society-state equation — by treating the state as if it is society, which is to say as if it is us. Formally, this would be

L does not believe that X should be done by the state,
which is to say that
L does not believe that X should be done by society,
which is to say that
L does not believe that X should be done by any of us.

except that it's not explicitly expanded in this way, else the jig would be up. One place you'll see this eristic equation employed is in many quizzes that purport to tell the taker what his or her political classification is. If he or she answers affirmatively to a claim such as that society should help the poor then the typical quiz will score that towards state socialism and away from classical liberalism (of which Libertarianism is the extreme).

(Actually, one needs to be very careful whenever encountering the word society. In practice, it is often used to mean everyone else. Sometimes it's used to refer to some hypothetical entity which is somehow more than a group of people and their system of interaction; this latter notion tends to operationalize, again, as everyone else. Equating society with the state, and coupling this with demands for the state to make greater demands on other people is a popular way of making society mean everyone else.)

The fact is that one simply cannot tell, one way or another, from the datum that a person is a Libertarian whether he or she thinks that some goal ought to be pursued, unless the goal involves what a Libertarian would label coercion; because Libertarianism itself is no more than a belief that one ought not to initiate the class of behaviors to which they apply this label. A person can be a Libertarian and be all for voluntary redistribution, or that person might indeed be someone who embraced some of the more callous proclamations of Ayn Rand, or the Libertarian might hold some intermediate postion. Libertarianism itself is neutral.

(Within the Randian camp, there has been a willful confusion of the fact that Libertarianism itself has limited scope with the proposition that any given person who is a Libertarian must somehow have no view about matters not within that scope, or with the claim that a Libertarian must think that anything not prohibitable is good.)

Parallels can be found here with the claim that atheists do not believe in morality of any sort. Not only is the underlying fallacy very similar, but the implication in each case is that, should the persons in question believe that something ought to be done, they are more likely to see themselves as the someone who ought to do it.

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.)

---

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.)

As I was looking for a holder for the Esterbrook Nº 356 nibs that I got, I ran across dip pens being produced by Steven P. Engen of Cottonwood, AZ. While these could hold a Nº 356 nib, they're not particularly well suited for that particular purpose.

None-the-less, I was especially attracted by this pen made of African blackwood and alabaster (here with an Esterbrook Nº 048 nib):

It arrived yester-day and was as nice as it had looked in its pictures. I then ordered this pen made of olivewood and ironwood:

Honestly, I'm not sure how much I'll use them for writing (now-a-days, my every-day pen is a Lamy cp 1 black fountain pen), but I figured that I'd later think back with regret if I failed to get these two pens.