Just Some Thought

Cell Biology

2010-02-10T01:14:00.002+11:00

Cell Biology

It is an interesting overview from Khan Academy

Concept words from the video are:

Nucleus
Ribosome
Endoplasmic Reticulum
Golgi Bodies
Eukaryoke (with nucleus) : {plants, animals, fungi etc}
Prokaryoke (no nucleus) : {bacteria, archaeu}

So many interesting information!

Deep State

2008-06-24T22:27:00.003+10:00

I have to say the points made by Professor Peter Dale Scott are rather disturbing.

Basically it is the same old story we heard again and again: USA government is controlled by a military-industrial complex (MIC).

In this interview, Peter has thrown in a lot of supporting evidence. The very existence of the Deep State has destabilized the Democratic state of USA.

An example he cited is the sponsorship of the Islamic extremist in Afghan back in the 80's. The whole goal of the exercise is to, in Zbigniew Brzezinsk's word, "to give USSR their Vietnam". The idea was strongly opposed by the State Department, but it was still carried out at the end by the CIA. The Democratic State (the elected President and his cabinet) simply could not stop the clandestine operations.

USSR, in hindsight, would eventually collapse given the mismanagement of her economic activities. However, the hawks in the MIC wanted a total victory. Eventually USA reaped what she sowed: the Islamic extremist, led by bin Laden, struck USA in downtown New York.

Importance of seeing thing

2008-06-22T22:03:00.006+10:00

In this interview, Professor Steven Chu has mentioned how important that modern equipment has allowed him to "see" and hence led to new discovery physics.

A similar theme was also covered by Benoit Mandelbrot in one of his interview, which unfortunately I cannot locate the relevant resource now. In the interview he said his development of factual theory is in part made possible due to advance in computer graphic.

Recent advance in Cognitive Psychology are in no small part brought along by the use of fMRI on human brain.

This is why the developed world has such an advantage in science R&D. Having new mean to see and explore new dimension in the world around us is instrumental to new scientific discovery. Few developing countries have both the financial strength and human capital to build this capability. Thinks: how many nations on earth has atomic accelerators?

Noam Chomsky @ Google

2008-06-17T01:40:00.002+10:00

Noam Chomsky talked about

Universal grammer
American Empire
Email and SMS's impact on languages

"One Soldier" by Steven Wright

2008-06-09T22:02:00.001+10:00

An interesting, very well-made short film by Steven Wright.

Hyperpower and Tolerance

2008-06-04T00:27:00.002+10:00

Yale Law Professor Amy Chua talked about her book, Day of Empire, which is about the rise and fall of hyperpowers. She cites that the practice of tolerance as a major contributing factor to the rise of a empire to the status of a hyperpower. Of course, the meaning and context of tolerance in the ancient times is very different from our present day concept. Using Roman Empire and Tang Dynasty as examples, tolerance is about valuing a person based on his skill and merit before his race and country of origin. The successful empire were also able to build an identity that the ruled were happy to adopt.

I think it is spot on. The current administration of USA has largely discarded this view and believed that they can subjugated other countries by mean of the military might. Iraq and Afghanistan have proved that Donald Rumsfield, Dick Cheney and other neo-con has learn the wrong lesson from history.

USA is still most qualified to be a hyperpower because of her diversity and the openness of her society. But it is not a given, especially in the light of growing xenophobia.

Just barely 8 years ago, USA is the country where everyone else looks up to. Who would have expected it?

My Favorite Comedians

2008-06-01T22:40:00.000+10:00

They are, not in any particular order,

Craig Ferguson
Russell Peters
Eddie Izzard
Jon Stewart
Stephen Colbert
Frank Caliendo - His Bush Impersonation is fun.
Wil Anderson
Dave Hughes

Going nuclear

2008-05-28T21:28:00.000+10:00

Italy is studying to restart their nuclear energy program. USA is looking at this option. In Australia, the Howard government, which has been voted out this year, has also argued the need of adopting the nuclear energy in the name of combating Global Warming (How ironic!). Australia, a major exporter of Uranium, has only limited unclear facility for research and has chosen to remain unclear-free so far.

Therefore, it just makes me wonder: why nuclear energy becomes a trend all of a sudden?

More than 50 years ago, general public in the developed world were more ready to accept the use of nuclear power. At that point of time, people, including the proponents of nuclear plants, believed that nuclear energy will solve energy crisis once and for all. Electricity would become so cheap that it would be too cheap to meter.

Of course, it turns out to be not the case. First of all, the cost to upkeep a nuclear plant is not cheap. Then comes cost of the handling and storage of nuclear waste. Thirdly the consequence of a major accident in nuclear plant, God forbid, is guaranteed to be catastrophic. The downside risk is simply too big to justify the marginal saving of energy cost.

So, why our politicians are so eager to promote the nuclear plant now?

I cannot help but think in conspiracy theory mode: a nuclear plant can only produce cheap energy if and only if a government is willing to bear part of the cost, be it incentive in form of tax concession or subsidy in various forms (e.g. sponsored a nuclear waste processing site using public money).

It is not only costly to build and run a nuclear plant, it is also very costly to close it.

In the other word, once we commit to nuclear energy, then even after we discover a better, cleaner and safer technology to generate energy, we will not be able to make a switch because it is not economical. A unclear plant will not be closed before its end-of-life date simply because better competitors force it out of market by way of market mechanism. It is because the upfront capital investment is so big no investor will voluntarily close it as long as the revenue will cover the operating cost. The astronomical cost to dismantle the nuclear site is also another disincentive. Unless, of course, unless someone come along and pick up the bill. Guess who will that be? Our government again on behalf of all the taxpayers, certainly.

It begs a questions: then why it is attempted at all to lock the general public into the nuclear energy? The nuclear power plants, once they are given the go-ahead, will cement the current centralized energy generation/distribution paradigm into next century, if not eternity. If the unclear energy supporters cannot get their way now, then in next 5 to 10 years, there is a distinct possibility that the renewable energy technology will become sophisticated enough to replace the need of any additional conventional power plants. There will no justification to build any large-scale energy generation plants at all.

It is certainly not a good news for existing energy sector incumbents. And probably mean loss of business opportunity to infrastructure sector and investment bankers. For some existing players in the energy sector, I speculate, they see renewable energy as a subversive technology because of its distributive (or democratic, if you will) nature. A right green energy technology will enable ordinary people to generate energy in their backyards to fulfill the energy appetite of an entire household. It will be a game changer to the current capital-intensive business model.

Some big infrastructure companies and bankers will also naturally prefer big projects like a mega-watt power plants. A plant will create demand for supporting infrastructure around the plant and the building of the the plant itself. Bankers can underwrite and issue debt to finance these projects. The big energy firms are most likely to pay handsome fee for any business and financial advises from the bankers.

What I have learnt from Eurovision

2008-05-27T22:08:00.000+10:00

There exists a nation called San Marino.

Wrong question?

2008-05-26T09:00:00.006+10:00

There is this interesting article, China’s Class Divide, by Daniel A. Bell in NT Times. Here is a brief summary of the content.

"Tsinghua is one of China’s most prestigious universities and it is known for its politically conservative orientation. President Hu Jintao is an alumnus, and most of my colleagues are Communist Party members, as are many of my students.
Yet the atmosphere is anything but conservative. The most popular lecturers tend to be the ones who openly criticize contemporary China. In private, students are quick to express frustration at Internet censorship and official propaganda. In class, student questions are often critical to the point that I need to introduce some “pro-government” views for balance.

Shortly after the uprisings in Tibet in March, I happened to lecture on Locke’s idea of constitutional democracy. A student asked if the “right to rebel” would justify the use of violence by Tibetans fighting for independence. In the interest of class time, I had to shut off the discussion. The next week we discussed Isaiah Berlin’s concept of freedom. Once again, I was forced into the strange position of cutting off debate before it got out of hand.

After the Sichuan earthquake, I was due to lecture on John Rawls’s theory of justice. I tried hard to think of an example that the students could grapple with.

Finally I came up with a good one (or so I thought). According to Rawls, the state should give first consideration to the worst-off members of the community. But which “community” matters? Do the state’s obligations extend outside national boundaries? For example, the cyclone in Burma caused more deaths than the Chinese earthquake. Should China help the victims of the Burmese cyclone, even if it means less aid for the rescue mission in China?

When I finished, the class went unexpectedly silent, to the point that I could feel a certain amount of hostility. Finally a student said that of course the Chinese government should help the Chinese first. But why, I said? Another student said, it’s obvious, the victims are Chinese. “But why, why?” I asked, somewhat impatiently. Give me some reasons.

Some students spoke up. There is no global institution that could distribute aid in accordance with Rawls’s principles of justice. The Chinese people pay taxes to the Chinese state, so the state has special obligations to them. The Chinese state couldn’t do much for the Burmese people even if it wanted to.

I responded that the Burmese government is truly awful, blocking aid to its own people, and that the Chinese government could have some influence on it. The bell rang. In the past, the ever-polite students would clap in appreciation before leaving. This time, there was no applause.

When I got home, I realized that I had trodden on sensitive territory. Chinese TV has been filled with scenes of death and devastation, of Chinese soldiers wading through mud and gore to help the victims. Every conversation is prefaced with concern about the victims. I sent an e-mail message to the class apologizing for the “wrong-headed” example.

A student wrote back saying, “It is not a wrong-headed example; we just have clear and strong identification.” That seems to go to the heart of what went wrong. It’s perfectly natural to care about people closer to home, especially in times of disaster."

I think while the questions is worthy of critical examination and scholarly discussion, the timing of raising it in the class cannot be worse. It is as if asking a class of American students why USA foreign policy caused the hostility from aboard right after 9/11. I don't think there are many of us who are capable to deal with the weight of the question rationally.

This question, I think, also highlights a difference in the Eastern and Western moral values: In the East, as exemplified by Confucius's teaching, the care for others are radiated from an individual along the axis of the distance of relationship. An individual is expected to care for himself and his family first, then his country, and lastly the universe. (修身,齊家,治國,平天下 - "Cultivate yourself, Maintain your family fair, Make your country peaceful and prosperous, Bring eternal peace to the World" )

The Western moral value is strongly influenced by the Christian faith. The value is deeply rooted in the culture and manifested as belief in Universal Values such as Human Right, even though more and more European, and to a certain extend, American, are turning their back to organized religions,

In China, A similar view has been taught by Confucius's contemporary rival school, Mohism. Confucius has refuted this as preposterous because he did not believe one can love a stranger as much as one can love his parent.

Investment Survival Note 7 - Sound Accounting For Investors

2008-05-25T06:00:00.000+10:00

As an investor it is important to do proper accounting to keep track of the P/L of his/her holdings. Ideally the holding should be marked to market frequently if not monthly. All cost and income should be recorded. It helps an investor to have a realistic picture of the health of his/her investment.

An investor should also maintain a reserve account which sets aside cash for tax on realised and unrealised profit.

The book was first written in 1936, so, I reckon, it did require work and discipline for average do-it-yourself investors to keep track of P/L back in those days. Today, with all these online resources such as Yahoo Finance, it is a lot easier to do so.

Quick link to The Battle for Investment Survival by Gerald M. Loeb

Go and Life

2008-05-24T01:34:00.006+10:00

Go is an ancient Chinese board game. I always want to learn more about it, but never really have the time until recently.

The more I understand Go, the more I appreciate the beauty of the game.

The basic move is extremely simple: If you want to capture an enemy, just place sufficient numbers of your pieces surrounding the target such that they are completely cut off from their kind, then they become your PoW.

In order to win, a player must occupy a bigger territory than his/her opponents at the end of the game.

However, I can assure you that you cannot achieve this goal by simply just battling your enemy out.

In fact, focusing too much on winning individual battles may end up costing you the ultimate victory. Simply put, since it usually takes more pieces to take over enemy land, if you spend your resources (i.e. pieces) to warring, instead of territory building, you may risk not occupying enough land. Battles should only be a mean to secure your territory or weaken your opponent, not an end in itself.

How does it related to life? Well, sometimes don't we focus too much on immediate, short-term gain (akin to capturing enemy pieces in Go), and forget our bigger pictures in life?

Investment Survival Note 6 - Speculation and Investment

2008-05-24T01:04:00.002+10:00

The author reiterated his view that why investing for dividend and interest income doom to fail. His feeling is if someone aims to double his net worth might, he at least has a chance to succeed and retain his capital or even make a good profit out of it.

However, trying to double the money return requires a lot of hard work.

Quick link to The Battle for Investment Survival
by Gerald M. Loeb

Militant materialism

2008-05-14T05:38:00.011+10:00

Came across this co-ed article on IHT, by David Brooks. By coincidence I found this blog post , by Jean Kazez, soon afterwards, which is related to belief in God as well.

I do not think I have much nice thing to say about David Brooks. Let's say I am usually unimpressed by the arguments put foward by David in Shields and Brooks on PBS. Not because he is a Right-wing political pundit per se, but because what his reasoning and arguments are usually not very grounded. I still watched the PBS program because what he has to say, it seems to me, a good indicators of the current conservative sentiments and stances on issues.

But this article, which first appeared in NYT in case you may not know, articulated the issue of the current wave of militant materialism against the Religion rather well. Two outstanding icons in this movement are Richard Dawkin and Christopher Hitchens.

My primary reservation about Richard and Christopher's position is: If we apply reduction blindly, and dismiss phenomena in the field of spirituality rather offhandedly, then go on to brand people on opposite side as delusional or stupid, then it is not a scientific approach to study a problem.

God exists or not? I like to compare this question to the study of nature of light back in the 17th century. Issac Newton believed light is particle but Descarte thought it is wave. Do you think one side has a particular right to brand the other side delusional and stupid? We should always keep in our mind the limit and boundary of human knowledge and intelligence.

Jean's article has given his view on the reasoning and response from both side of the argument. I agree with the fact he pointed out: both sides are so ready to throw in stock arguments.

Overall, between the Militant Materialism and the Militant Evangelicals, there is no dialog going on. Just publicity grabbers grabbing for publicity.

A proof of the lack of depth: do take a look at how Christopher Hitchens debated his view against Kenneth Miller in the Templeton Conversation.

I was mildly offended when Christopher probed Kenneth's religious background. (Out of the blue, he bought up the question, "Incidentally, are you a Christian?", to Kenneth) While it is an effective debate technique, i.e. to highlight one's board identity in order to imply the innate bias, and hence invalidity, in his/her reasoning. It is not right in this debate especially when the opponent is sincere and candid in the discussion.

Google Tech Talk: Economic Naturalist

2008-05-07T21:53:00.004+10:00

An interesting talk.

Although some of the feedbacks on Amazon are somewhat less than positive (
Economic Naturalist: Explanations Everyday Enigmas).

UC Berkeley History 7B

2008-04-26T19:32:00.003+10:00

One of the podcast I enjoy a lot listening to lately is the UC Berkeley History 7B by Professor Jennifer Burns.

This course covers US History from Civil War to the present days. Some stories are amazing, some stories make your blood boiled. In about 40 lecture audio (usually about 1 hour in length), one will be able to walk through the path that USA as nation has taken to become what she is today in last 150 years, without the stress of examination and tutorial. Isn't it a good deal?

I have learn a lot of interesting thing from this series of podcast. For example, since the Reconstruction, industries in the North started moving to the South to take advantage of the cheap labor and land cost there. The seeking of cheaper production cost is obviously not a recent phenomenas. Coupled with today's technology, the shift of production base has a even wider and farther reaches. No longer confined within a national/cultural border, production process are either continuing to move South to Mexico or relocated to overseas (such as China) altogether.

Now, after 20 years of development, the production cost of China finally starts to rise. The factory owners immediately respond to it and moving the plants to other cheaper location such as Bangladesh or Vietnam.

Public sentiment in developed countries, without exception, always blames 'Other People' for 'stealing' their jobs. The blame is laid on the wrong subjects.

Investment Survival Note 5 - How to Invest for Your Captial Appreciation

2008-04-19T22:00:00.005+10:00

One should not invest for the sake of "being in the market" or "Income". When one is making stock selection, he/she should take both income and potential of appreciation into account.

The only way to begin is learn by doing. An investor can invest in a handful of stock. The situation of the market will force the investor to think about buying, selling or holding. It is much better than "paper transactions" that many tyros indulges, because the real holdings test the investor's psychological reactions.

And this imply that one must invest time to study investments.

This initial experience fund should be very small, ideally not over 1o% of one's asset. And time. If time is an issue, then you may be better off delegate the investment decision to the professional. This exercise also help you to discover if you are cut out for trading.

The author argues that beginner should do more short-term investing. Some people believe that there is more peace of mind if one simply keeps a stock for a long pull. Experience seems to contradict this claim. It is because many 'long term' investors ignore change of market condition. They may be correct in short term, but may pay a dear price in the long run.

Short term method requires the closing of a trade for a good reason. If the condition changes again, then one can choose to re-establish a position again.

Quick link to The Battle for Investment Survival by Gerald M. Loeb

A New Energy Future

2008-04-15T22:53:00.005+10:00

It is an absolutely fascinating talk by Craig Venter.

Joining 3.5 Billion Years of Microbial Invention

Very well worth your 1 hr 45 min of your life.

Craig has actually covered a lot of subjects. A board outline here will not do justice to the brilliant talk, but I do it anyway:

Craig first recounted his oceanic expedition in which he sailed around the world and collected micro-organism in seawater every 200 miles for genome sequencing. On his way he has met French who jealously guarded their "genetic heritage" in French Polynesians territory, and even detained by British navy for a while.

The result is an astonishing proof of the richness and diversity of our eco-system.

Each local area has its own set of unique, diverse micro-organism. But due to modern logistic, these micro-organism are transported to different part of the world by our vessels. When anchoring in destination ports, large container ships discard sea waters which they have pumped up from, possibly, another part of the world far far away. Imagine the magnitude of the evolution challenge to the local species when millions of new, alien micro-organism are being released, along with the sea water, into the local environment on a regular basis.

Craig also described the mechanism to build a custom-design chromosomes. He emphasized that the scientists are not playing God. The technique is only possible because the microbial has invented the underlying mechanism through 3.5 billion years of evolution.

Lastly he introduced the vision of the 4th Generation Biofuel, a fuel that is generated by engineered bacteria using solely CO2 and solar energy (whereas the 2nd and 3rd generations of technology still require sugar as input to the process). It is a better solution because, comparing ethanol solution, the generated fuel can contain more energy per unit, does not absorb water and will not bid up the food price.

Investment Survival Note 4 - Pitfalls for the Inexperienced

2008-04-15T21:52:00.006+10:00

For any beginners in the stock market, they should try to gain experience by trading in the active , listed stocks. The beginners should learn to control their emotions through this exercise. After this they can start to choose a particular subset of the market to focus on and trade exclusively. The idea that someone can trade equity, bond, IPO, OTC and other exotic products equally well all at the same time is absurd. In today's world the advantage of specialization is already evident. The same holds true in capital preservation.

The main advantages of investing in leader stocks are the following: The transaction fee is usually cheaper, and it is possible to monitor the stock performance daily.

Beginners should avoid IPO because the prices are usually mispriced on the high side. Even if the IPO price is lower than fair value of the underlying, it will immediately lead to over-subscription. The amount allocated will be so small that it is hardly profitable.*

Secondly beginners should avoid buying shares directly from broker/dealer. We can hardly expect the salesman to be unbiased when they try to sell you their holdings.

One should also avoid secondary distribution because of the lack of price transparency.

Lastly, simply avoid the promoter, the penny stock and stock with romantic titles.

* I believes many "investors" in Hong Kong will dispute this.

Quick link to The Battle for Investment Survival by Gerald M. Loeb

Time travel

2008-04-11T21:43:00.004+10:00

By happenstance I picked up the book "Using the Wall Street Journal" (5th Ed.) by Michael B. Lehmann. This book has been sitting idly on my bookshelves, gathering dust, for a very, very long time.

On p. 99, there is a reprint of a news story published on 30, Jan 1995. In which it reported,

Greenspan Defends Moves

The Fed has been criticised for raising interest rates before seeing any evidence of worsening inflation, but Fed Chairman Alan Greenspan replied in remarks prepared for delivery over the weekend: "If we have waited until inflation had become evident, it would have been too late."

A lot has been changed since then.

Investment Survival Note 3 - Is There An Ideal Investment?

2008-04-03T07:04:00.007+11:00

From the Auther's point of view, an ideal investment vechicle is one that will repay income and principle in units of the same purchasing power as was originally invested. As far as we know, this kind of investment does not exist.

To quote,

"It is not hard to see why it should be merely a theoretical formula. Nothing is safe; nothing is sure in any field of life. Specifically the wealth of the world does not increased fast enough to allow payment of compound interest or pyraminding of profits on existing "invested captial". Every so often adjustment are made partly through bankruptcies and other scaling down of obligations and partly through deprecation. And it's all as old as the hills."

I find this passage specially relevant to the current sub-prime crisis. An triple A rating from a rating agency is never a guarantee of performance.

Quick link to The Battle for Investment Survival by Gerald M. Loeb

Investment Survival Note 2 - Speculative Attitude Essential

2008-03-29T09:07:00.008+11:00

If investment is as simple as just buying something for income, then compound interest should be suffice for this purpose. For example, if the Medici family had set aside $100,000 in a fund for 5% compound interest return, its 1933 value will be a staggering $517,000,000,000,000,000!

But there are a lot of threat to the preservation of capital: war, political change, new technical breakthrough, to name a few. As a result, only a handful of poeple can turn a profit from investment. Actually, for those who lost a portion of their purchasing power, they have done a lot better than most in the market.

Therefore , the author urged the readers to set a very high goal in their investment. The investors should aim at return so high such that it can cover the average loss sustained in the overall investment activities. The loss can be a consequence of, for example, poor investment decision, the effects of exchange rate changes, and unexpected closing position due to change in circumstances etc.

Quick link to The Battle for Investment Survival by Gerald M. Loeb

Investment Survival Note 1 - It requires knowledge, Experience and flair

2008-03-26T00:11:00.009+11:00

Unlike rules in the engineering disciplines that may stay true years after we left colleges, there is no universal rule in security valuation. Market values of stocks are influenced by too many factors.

However, to "Man on the street", he always believe, to the contrary, it is easy to make money. He is ill-equipped and unprepared. He take advises from brokers and dealers, and traded as instructed. If he loses, he loses so quickly that he believe he can recover from it just as fast.

It is almost impossible to beat the market consistently, even by the professional, but "Man on the street" believes that nothing is as easy to making money from the stock market. He is destined to lose.

If so, why should we still invest in stock market? Stock market provides unparalleled liquidity and frequent valuation of the stock. At low cost, one can quickly realised profit or cut loss. It is the virtue of a stock market. We should learn to avoid pitfall and wishful thinking, and take advantages of what the market mechanism has to offer.

At the end, the author asserts,

"Therefore, the more one learns about them, the more chance he has to preserve something. It is like anything else in life. Only a few amass fortunes. Only a few become really competent professional man or achieve real success in any line of endeavor."

Quick link to The Battle for Investment Survival by Gerald M. Loeb

The Battle For Investment Survival

2008-03-18T00:19:00.010+11:00

The recent market turmoil makes me reflect on the time-tested investment wisdom as laid out in the book "The Battle for Investment Survival" by Gerald M. Loeb.

Absolutely old fashion money advise. But for someone like me who is not a full time trader and has limited appetite for risk, these advises are actually very practical. The underlying principles are sound and easy to understand.

Therefore, I want to spend next few blog to write a sort of "reading report" on a few chapters of this book, such that, first of all, serves as a "note to myself", and hopefully make you interested in this book too.

R-Word Revisited

2008-03-15T06:47:00.006+11:00

I wrote a piece on mining the blog sphere for general sentiment of fear of recession, or the lack of it, back in September last year.

I revisited this subject, and surprise, surprise, here is the new set of figures:

It is just like economic data: it can be revised!

A bit of explanation of the table of data here: back in Sep '07, when I searched for total number of blog posts contained the word "Recession", says, for 2007, Google reported that there are 133,933 article. (As shown in the column "#Post as of Sep 07"). The figure, obviously, indicated blog posts created from Jan 2007 to 5, Sep 2007 only.

When I repeated the same search, the number of blog posts of 2007 has actually gone down, event though the time covered is full four quarters. Could it be caused by Google changing their search algorithm again, or people are actually withdrawing their blogs?

Nonetheless, from the relative change in the number of posts we can see a general rise in the awareness of the recession (be it we are in it now or it is going to happen). In the first month of '08, the number of posts covering Recession is almost 4/5 of the total number in 2007.

(Seems like it is not easy to construct a table in blogger)

Sydney Park

2008-03-14T21:31:00.003+11:00

Beautiful Sydney Park. Always remind me of the Teletummy Land.

(Click on the photo for a larger version)

Mental Illness and Capital Punishment

2008-03-07T22:33:00.009+11:00

I listened to this talk delivered by Bryan Stevenson, A Professor of Law at NYU Law School, to The DePaul College of Law Symposium. The subject is on Mental Illness and Capital Punishment in Alabama. I think the audio is only available in iTune U channel of Apple iTune application.

Strongly recommend to listen to.

Bryan is an excellent speaker. It is not only because he masters the art of public speaking, but also because he has many real stories, and an important message, to tell.

First comes the big picture: USA has the highest proportion of adult population behind the bars. It is a result of the so-called War on Drug. People will be thrown into jail by the Authority for procession of drug of any quantity. Those suffered most are -- surprise, surprise -- are women and children. It is because once anyone has been a convict, he or she will be automatically excluded from a majority of social security program such as food stamp and cheap housing.

Since many of these female convicts have children that they have to take care of, it is not hard for us to imagine the financial hardship these families have to face once they are released from jail, and how disadvantaged the kids are going to be. Poverty of this level has two consequences: they are more likely to have problem with the Authority; and if they suffer any mental illness, they are usually gone unnoticed or ignored.

As a rule of thumb, if someone seeks professional psychiatrist to defend himself in court on the ground of insanity, you will find this person, more often than now, can actually reason logically, can talk cohesively and have no problem understand consequence from a given action.

Poor people with real mental problem simply do not have access to or cannot afford professional help.

There is this terrible example of death sentence: A young man has stabbed his boss to death when his boss tried to sexually harass him. This happened in his boss's car. The young called 911 for help.

The young man was taken to court the next day 9:00 a.m. Three witnesses ware called: The Police call center operator who took the 911 call, the young man's colleague and the pathologist who conducted the autopsy. The colleague said since the same boss have any taken any sexual advantage of him, he did not believe his boss was gay. And -- surprise, surprise, the pathologist lend support to this argument by saying that his thorough examination of the corpse proves that the victim was not gay. Hearing was adjourned at 10: a.m.

Since the death occurs in an automobile, the young man is charged with a first degree murder -- a result of law reminiscent from the era of drive-by shooting. At 4:30 p.m. same day, a death penalty was handed down to this young man.

During this course of event, no one has checked the past history of this young man, who has been abused and raped as a teenager.

When he was locked up in jail to wait for his final chapter of his life, his psychosis was getting worse. He withdrew his appeal. He cut off one of his testicles, and almost killed himself. Then months later after this, he cut off the remaining one. At the end, he was executed by the State, and his case was never reviewed by either state court or Federal court.

Why, a country, as advanced as USA, cannot have some mercy for people who suffers so deeply from mental disease they have absolutely no control of?

(I am in a contemplative mood)

Nature and us

2008-03-02T20:38:00.004+11:00

The nature has a way to remind us that human is just a humble part of the eco-system.

(Click above picture to see the large version)

Growth vs Inflation

2008-03-01T22:54:00.005+11:00

By now, it is rather obvious that the Fed is determined to promote growth at the risk of having a runaway inflation.

Is it a sound policy?

I am never impressed by this obsession with growth. For example, Wall street expects the listed companies to grow continuously, ignoring the fact that there exists business cycle. Have you studied the "Constant Growth Model"? It is still a part of orthodox, formal financial education curriculum.

In order to fullfill this expectation, GE has to manipulate their accounting in order to smooth out their earning growth to satisfy the Wall Street analysts.

In making a choice between Growth Promotion and Inflation Control, it also highlights whom the Government and the Fed are serving.

Inflation control is in a way a self-imposed constraint of the Government and the Fed such that they will not impose tax implicitly on the public at large by printing money. Usually a low inflation rate is preferred because it allows the monetary base to grow with GDP without eroding the purchasing power of existing currency holder significantly.

However if the policy makers focus on keeping the momentum of growth of G.D.P., it is not clear who will ultimately reap the benefit out of this at the end. For example, employers, over the years, have mastered the art of boosting company profit at the expense of the worker by the means of layoff, or, the mere threat of doing so, to suppress the wage growth. General public does not get to share the fruit of the GDP growth.

Policy markers used to justify their pro-Growth decisions by saying that "A bigger pie feeds more people". But as modern technology has dramatically improved the productivity, a growth in G.D.P does not necessarily translate to increase of payroll positions.

I think I can see quite clearly who are going to lose out in next few years as a result of this series of rate-cut by the Fed -- the public.

Oversocialnetworkisation

2008-02-19T03:01:00.003+11:00

When I write this blog, I fully expect this information, given the exponential growing digital archive storage, will be kept for prosperity eternally.

As long as we can capture all these information in digital form of which, I can assure you, this tiny article is already in, then you, my dear reader, will always be capable of reaching this article, as long as you are so determined to know something about me.

The problem is: now since we remember so well, we are losing the ability to forgive and forget.

For example, some people made mistakes. Some people made mistakes occasionally, some people made mistakes all too often. We probably do not want to give forgiveness to perpetual liers, but we also should not dwell on one's bad move, which could be a result of poor judgment or simply circumstantial.

But today, every records are digitized. We can crosschecked records in A against records in B. Past stories no longer faded into oblivion with time.

As if they are trapped in a perpetual time capsule whose accessibility, paradoxically, is just a mouse click away.

A new generation of offenders now are the all-reaching social networks. It expands, it keeps tracks, it feeds on your personal information. Your misdeeds, once made public, by your own hands or not, will be instantly available to the World, and can never be retracted.

Your friend and your acquaintance will never forget too.

Those who watched will remember, those who had not will attempt to find out, those forgot can search to refresh the memory.

How will this impact human collective EQ is yet to be seen.

But I am glad this gives me a legitimate excuse to create a new word: Oversocialnetworkisation.

(The only worry is: the above "manifesto" makes me sound a bit like the Unibomder...)

Dysfunctional Market?

2008-02-06T06:18:00.009+11:00

In an ABC's podcast, Dr Paul Woolley gave an speech on Financial Sector Dysfunctionality. Indeed, witnessing series of financial stuff-up's in last centuries, one bigger than the other, shouldn't we slow down and take a good look at this interesting business sector?

Paul used his personal experience in the adoption of momentum trading to illustrate some recent worrying changes in the financial market. I don't think I can paraphrase very well, so please read full transcript here.

These days, financial sector is growing faster and larger, and taking increasing bigger share in GDP. It is, however, not entirely a result of the sector doing a better job as an intermediary between investor and borrower. Instead, especially after the rise of hedge funds, more and more financial operations are making profit from market volatility or other speculative behaviors. The money changed hand in the process has far exceeded the actual value of the annual global output. Does it make sense at all?

We can always reduce the phenomena to human greed and fear. In the other word, a financial market is for speculators to speculate, just like what Las Vegas is for gamblers.

But, could it be something more? If we know it is wrong and yet we fail for it decades after decades, could it be something more hideous that's lurking in our collective psychology?

Could it be similar to the construction of the Pyramids in Ancient Egypt? When a society make a collective economic choice and believe that a certain non-productive, expensive activities, conducted by a handful of elites, should be handsomely rewarded by the general public at large, is it a social/organizational problem?

For argument sake, let's assume it is. Then what purpose it serves? Could it be just a natural device to stabilize human population (e.g. to creating a underclass who either died of starvation or illness), or an essential mechanism to hold a society together (akin to a common religious experience)?

Actually the religious analogy can be further developed.

The various indexes are like the Oracle. It may or may not tell the future direction of the economy.
The big financial houses are like Temples. High priests are there to talk to the Gods.
Their royal servants, me included, dutifully takes up the responsibility of all daily housekeeping activities and, most important of all, money collection. We highlight the blessing one will receive if they sacrifice all their income to our product, and unconceivable suffering if they do not put away their for investment.
Occasionally we have good news to the people: "Rejoice, the Oracle of Gods hath spoken. A new era has come. Sell all your belonging and buy the stocks of these websites!"

Well, I think you have got the idea.

But seriously this topic deserves a more systematic, in-depth treatment.

France and Deregulation

2008-01-11T02:55:00.000+11:00

Very obviously, the martial status and love life of Sarkozy is taking the limelight, and mainstream media basically treat this story as if it belongs to entertainment section.

Oh, well, that's why mainstream media is mainstream, isn't it?

So, when I learn about the reform Sarkozy has brought to France, I was a bit surprised. News like this basically escape me, a news junkie.

The following are some example:

Abolished the 35 work hours/week restriction. On top of this, a worker does not have to pay tax on the income resulted from his/her overtime. Employer is also only required to pay a lesser contribution to pension and health care levy for the overtime payment.

Simplify the tax laws: for some lower income family, a bill is passed so that a ceiling, 50%, is imposed on they have to pay to government. This does not include just income tax alone, but also covering various government fee and charge.

Bills passed to weaken Union power

Actively encourage the R&D via financial incentive

(It is reported by Bloomberg on the Economy Podcast - Interview with Philippe Farve, 21 Dec 07 )

It seems like it is going to be a Generational Change in France. In the all these hype of BRIC (Bazil, Russia, India and China), people probably is not aware that Europe actually has a balanced and increasing vibrant economy.

Next to do: get some quantitative data to verify the above view.

Have It Both Ways

2007-12-05T06:16:00.002+11:00

Just had a chat with a colleague the other day. He was watching the BoC (Bank of China) Stock. My colleague said the stock price was depressed due to its involvement in the sub-prime market. A spokesperson of the bank said they are in it because their traders are "inexperienced".

I cannot help but laugh! "Inexperienced"? You really can't have it both way: when you are making money, you are the smartest person on the world. All the profit are the result of your vision, insight, education, risking-taking spirit, understanding of market and sophistication. But when the tide turns against you, "Oops, ya know, this thing is kinda new to me". Yet handsome bonus is still waiting for you at the end of the year, like usual.

It does not make sense to me. You should not have it both ways.

(*What my colleague said is not fact checked)
(Writing in a slightly sarcastic mode)

The R-word

2007-09-05T22:41:00.000+10:00

Recession is now being discussed again.

I vaguely remembered that there was an academic study of the correlation between number of published news articles and the occurrence of recession. I believe the conclusion is that the article numbers is probably a good leading indicator to a looming recession.

Todays, can we use the blogsphere as a data source? A quick Google search gave the following result:

Year	Count
'07	133,933
'06	66942
'05	19049

It is a very rough sketch. It did not take into account the blog entries that existed during the surveyed time period. It did not check the context either.

But if blogshpere serves as a place for collective rumbling, maybe there are messages to be mined out of it.

House of Cards

2007-09-05T22:24:00.000+10:00

Some high-profile resignations:

Michael Brown of FEMA resigned on 12 Sep, 2005

John Bolton, UN Ambassador, 4 Dec, 2006

Donald Rumsfeld's resignation took effect on 18 Dec, 2006

Pual Wolfowitz, World Bank, 30 Jun 2007

Karl Rove left the White House on 31 August, 2007.

Alberto Gonzales's resignation will be effective on 17 September, 2007.

These are the people President Bush trusts and believes to have done a helluva job.

Without a doubt, Bush administration has become a lame duck government.

And, where is Dick Cheney in all these? In this sense, he is very smart: he is able to pull off the Iraq war but yet seemingly immune to any political trouble.

Unfolding of Events (Subprime market)

2007-08-20T02:15:00.000+10:00

The Fed has cut down the discount rate by half a percent last Friday (17 Aug). We can see it as a move of FRB (Federal Reserve Board) to allow those financial institutes in trouble to have access to liquidity without yielding to demand for a board Fed Rate cut. "The money-changers must accept some kind of haircut and should not expect bail-out" seems to be the signal of the move.

Probably as long as no major financial institutes go belly up, we can say the crisis is contained within the financial sector? But then, it is a very narrow definition of containment. Like Daniel Gross of Slate.com said, if containment of Cold War was as effective as this one, we will all be speaking Russian and farming collectively. A recession is inevitable.

NY Times has this piece of reporting on the subject. One theme in this articles is "somehow, the best brains in the Wall Street just did not see it coming". Yeah, Ken Lay did not know anything about accounting in Enron either.

More plausible explanations are the following:

Of each of these well-known financial power houses, the role of research departments to traders are like the "fair and balanced" Fox news to the Republican party. Research reports from these Wall Street firms are the smoke and mirror in their proprietary trading and M&A activities. Long gone are the days when (some) researchers can write about their honest opinion. Therefore obviously the research departments said very little about the riskiness of the subprime market.
Traders in hedge fund and their counterparties in the financial powerhouses, who profited immensely from the paper profit from these subprime securities, simply do not have the will nor incentive to do the right thing. If the trend in the market is to buy these secularization products on leverage in order to make that outrageous return, why not follow the flow? At least one has to be in the game to show that he/she is professional. After all, it is the management fee/brokerage fee these fund managers and deal maker care about. Repercussion that may surface five years from now? It cannot be quantified as a number on P/L anyway, so no one care.
It is of absolutely no one's interest to forestall a bubble. No Fed chairman or regulatory bodies will do it. When the time is good, any proactive measure will be perceived as 'spoil the party'. When thing turns sour and the Fed have to engineer a rescue, the players just have to sit back, play dumb and blame the market. Ultimately, the financial institutions will be very likely be bailed out by Fed; Fund managers and broker have already pocketed their bonus in good years; Fed chairman emerges the Hero.

Point 2 highlights an issue in the current financial markets: the lack of diversity. After years of consolidation, smaller players are simply gone. An investment idea can now spread across this industry like an fungi infection in a banana plantation. The financial strength and simple-mindedness of the investment community will be a root cause to more stupid yet severe financial crises in years to come. Maybe more can be said on this subject.

An article by Edward M. Gramlich of FRB on Subprime.

Subprime now and S&L Crisis in 1980s

2007-08-12T20:47:00.000+10:00

The Subprime crisis is still unfolding. In nature it is similar to the S&L Crisis in 1980s. What we can learn from the past? And can we predict what will happen next?

The lessons are always the same as in other major financial crises:

Easy Credit leads to bad investment decision. (Inefficiency in economy)
Excessive risk built up in the system
Moral hazard
"When thing is too good to be true, it probably is"
A bigger fool theory is proven once again (w.r.t to home buyers and subprime security investors)

The unfolding of the Subprime is ugly. US housing was busted about a year ago, but most news outlet are mute about the looming crisis. All of a sudden, the market was 'awaken' to the reality that massive amount of loans will become bad debt because the borrowers simply could not repay.

How could these lenders be so blind just a few years ago? Of course not, they were rational players in this game: Borrowers get the money they want for buying the house in a bull real-estate market, thinking they can always sell the house next month for higher price; Lenders have access to cheap money and are willing to lend out for high interest, then repackage the mortgages via securitisation to get rid of the risk. Professional investors or fund managers took them up because their performance immediately looks good.

So, hopefully this time around the impact is limited. Hopefully the central bankers play their cards carefully and will not let the Asian Financial Crisis American Version to happen. Since Fed did a lot to rescue the economy during the bust of the Dot-com bubble, therefore, while a recession is pretty much a certainty, we probably will not see a meltdown in market this time too. (A counter argument is: the Fed flooded the market with money in order to avert a meltdown due to dot-com bubble, by which it indirectly created this housing mega-bubble. Now, how can the Fed pull the same trick since there is no market bigger than real-estate? Honestly, I don't know)

Back in the time of Dot-com bubble I was very risk-averse and did believe in "the possibility of deflation - 1920s style meltdown". It turned out to be groundless because all our money are fiat money. Deflation is not possible unless the Fed wants it to happen.

Now, let's cross out finger and watch how Bernanke handles this crisis.

At the moment, politically, comparing S&L, this crisis may draw less attention from the public because, first of all, this crisis did not really wipe out deposit of "ordinary folks" en masse. Secondly, so far, the effect only impacts some people. The rich may lose via their investment in high risk hedge funds (which the government will bail them out eventually); Employee/retiree via their pension fund loss (which may not surface immediately).

So, if past experience is any guide (the Dot-com bubble and Enron crises), it is very unlikely that Fed and Bush administration will allow the subprime crisis to develop into a major financial disaster.

Mood: cautiously optimistic.