Sunday, February 24, 2013

There's No Such Thing as Building a Business - Clive Crook - The Atlantic

There's No Such Thing as Building a Business - Clive Crook - The Atlantic

I think we have gone through a period when too many children and people have been given to understand "I have a problem, it is the Government's job to cope with it!" or "I have a problem, I will go and get a grant to cope with it!" "I am homeless, the Government must house me!" and so they are casting their problems on society and who is society? There is no such thing. There are individual men and women and there are families and no government can do anything except through people and people look to themselves first...

Britain was going through a v-Bi stagnation, innovations in technology led to more Iv-B where new ideas from individuals were being obstructed as deviant from the normalized society. Often the country was poor enought o become Roy, businesses became G public property as did housing. The new wealth from these Iv-B shoots wanted more GB privatization and individualism like a forest trying to grow from a near desert after new resources and seeds of innovation were added. Looking to themselves first is competitive Iv-B instead of cooperative V-Bi. This set off booms that would eventually bust like growing weeds.

There is no such thing as society. There is [a] living tapestry of men and women and people and the beauty of that tapestry and the quality of our lives will depend upon how much each of us is prepared to take responsibility for ourselves and each of us prepared to turn round and help by our own efforts those who are unfortunate.
To any fair-minded person, the idea that Thatcher denied the existence of society is as daft as the idea that Obama thinks Steve Jobs didn't build Apple. Actually her meaning was nearly the opposite of the quoted words. What she meant, and what she ought to have said, was, "When you tell society to fix something, remember it's not some abstract third party you're making demands on but the people who make up that society." What Obama meant, and what he ought to have said, was, "If you've got a business, you didn't build it on your own."

Economist's View: Shiller: Bubbles without Markets

Economist's View: Shiller: Bubbles without Markets

Some examples of social epidemics unsupported by any speculative markets can be found in Charles MacKay’s 1841 best seller Memoirs of Extraordinary Popular Delusions and the Madness of Crowds.The book made some historical bubbles famous: the Mississippi bubble 1719-20, the South Sea Company Bubble 1711-20, and the tulip mania of the 1630’s. But the book contained other, non-market, examples as well.
MacKay gave examples, over the centuries, of social epidemics involving belief in alchemists, prophets of Judgment Day, fortune tellers, astrologers, physicians employing magnets, witch hunters, and crusaders. Some of these epidemics had profound economic consequences. The Crusades from the eleventh to the thirteenth century, for example... Between one and three million people died in the Crusades.

These are usualy Iv-B and Oy-R, people are often deluded on both sides. For example Iv and Oy quack healers might see some results and this spreads to other quacks, R and B people also see some results and it spreads as rumours of cures like Chinese Whispers or a contagion.  

There was no way, of course, for anyone either to invest in or to bet against the success of any of the activities promoted by the social epidemics – no professional opinion or outlet for analysts’ reports on these activities. So there was nothing to stop these social epidemics from attaining ridiculous proportions. ...
Without I-O policing there is a disconnect where this contagion grows in secret while the more transparent V-Bi and Y-Ro parts of society ignore or don't see them. 

The recent and ongoing world financial crisis pales in comparison with these events. And it is important to appreciate why. Modern economies have free markets, along with business analysts with their recommendations, ratings agencies with their classifications of securities, and accountants with their balance sheets and income statements. And then, too, there are auditors, lawyers and regulators.
All of these groups have their respective professional associations, which hold regular meetings and establish certification standards that keep the information up-to-date and the practitioners ethical in their work. The full development of these institutions renders really serious economic catastrophes – the kind that dwarf the 2008 crisis – virtually impossible.

Not when there is weak I-O policing, the disconnect allows them to flourish undetected like quack healers without police catching them in their frauds. For example in Delhi there are as many uncertified doctors peddling medicine as those that are licensed according to the BB series Scam City. They each work disconnected from each other.

America's demographic cliff

Collectively, we boomers were lucky. We were the most healthy, educated and privileged generation ever born. Our youth was spent virtually worry free. Our college educations were inexpensive, gas was cheap, jobs were plentiful and our futures were bright.

This is the growing of Biv society in rich resources, B baby boomers growing up together and changing the world to suit themselves. They were highly competitive and innovative at this stage like the roots of a tree.
We were the "Hippies" of the late 1960's and early 70's. Love was free and drugs were cheap (orwas it the other way around).

 At this stage they become Bi teaming up to get more resources by cooperating.

Then the 1980's rolled around and we became "Yuppies". We began to believe that success was our birthright.

After Bi confrontation with the Iv dominated police of the establishment they grew up to be protected by the same police and to keep their brithright of their original B roots. They became Iv competitive. 

We bought our BMW's and wore our V-neck sweaters. We turned conspicuous consumption into an art form. Hell, even Newsweek Magazine gave us our own year (1984). We were so busy clamoring to the top of the corporate ladder we forgot to develop any job or management skills which would lay a foundation for future generations to flourish.

The corporate ladder is like growing Iv branches.
Then as we aged, we hit our peak spending and borrowing years in the 1990's.  We went a bit middle age crazy. We splurged on second homes and McMansions.

This is the V flowering phase before retirment, people seed like trees with their children after showing off their assets like flowers to attract suitors for them.

 We thought fuel would be relatively cheap forever and bought gas guzzling SUV's. We also padded our financial statements and maxed out our credit cards trying to "keep up with the Jones's". Some of our brethren became bank CEO's and leading politicians, whose unethical and irresponsible behavior has been a reflection of our entire generation. We didn't want the party to end and they just tried to prolong it for us. We wanted it all and never learned nor cared for moderation.

V people now form a team to get more assets, the top of a tree tends to grab more resources from the rest of it. 
And now in the Autumn of our lives it looks like we are going to get it all (of course in devalued dollars). We will leave those coming up behind us with nothing but debt, austerity and a lower standard of living.

The trees collapse allowing their seeds or children to use the humus to grow in.

We will be reigning in our spending and hoping to save so we can offset future inflation. The malls, our cathedrals of consumption, will be ghosts towns compared to what they were, with "30%-70% off" signs decorating their stores windows.

Like dead and dying trees of wood which takes a long time to decay into humus, or it can be propped up as a zombie economy.

We will be net sellers of equities and mutual funds soon, not net buyers. Therefore, trade accordingly. It was fun while it lasted but now the piper must be paid. You know the old saying; the longer the party the bigger the hangover. Well, this hangover may last 25-30 years until the last of my generation are dead, either through natural causes or intergenerational warfare.

Inequality: Complex machines, simple cogs | The Economist

Inequality: Complex machines, simple cogs | The Economist

Mr Lindsey approaches the question of rising inequality through the prism of complexity. Modern economic growth, he notes, has been the story of positive feedback loops between specialisation and knowledge accumulation, which have given rise to ever more complex social and economic systems. Economic outcomes in this world come down to differential abilities in managing complexity.

In Aperiomics this complexity is largely hidden in society until the chaos causes collapses, for example in the GFC. Until then we see glimpses of orderly exponential growth. This specialization is often not knoweldge accumulation but an accumlation of rumors and deceptions, for example like beliefs and hype in a real estate boom. The assumption is that someone else somewhere understands it which feeds back into false confidence then disillusionment in a crash. 

  The story of economic growth as one of ever increasing complexity is attractive. I'm not sure I'm sold on the idea that a steady increase in societal and economic complexity must necessarily lead to more inequality, however. That is certainly the story of the past 30 years, but I don't know if it's the story of the era of modern economic growth as a whole.

This inequality comes more in an Iv-B and V-Bi disconnect, Iv-B is like a poker game of bluff where some do far better creating inequality and happens around innovation.

 The honing of assembly line techniques allowed for further deskilling, but workers were able to capture a large share of the gains from the resulting surge in productivity. Production was becoming more complex, but jobs were getting simpler, and the upshot was an explosion in opportunities for high-wage, middle- to low-skill employment.

Assembly lines grow like Iv-B root and branch structures, parts are put together into a whole like roots coming together onto a trunk. Jobs can become more spcialized and chaotic, they can lead to an exponential growth or explosion of employment or collapses if industries fail. The system can be highly unstable as the explosion of growth in the 1920s led to the Great Depression.

Moral Imagination and the Fate of the World

Now here's the thing about policy makers: they have in recent decades become less and less autonomous. Thanks largely to new information technologies, they're more constrained by public opinion, by immediate and powerful popular feedback. And I contend that whether they are "allowed" by their constituencies to pursue wise policies will depend on their constituencies' moral character in a certain specific sense.

This can become highly chaotic where leaders not follwing this feedback might suddenly collapse, their popularity might also boom and bust between floors and ceilings compelling them along this path. By conteast a V-Bi government might try to follow a normalized equilibrium of policy ignoring this pressure to become deviant. The sense of crisis forces them to become more Iv-B, and in some poorer Roy countries Oy-R. it can also be caused by revolutionary and counter revolutionary innovations and inventions, these cause weed like growth to use these new resources. The politicians then create more chaotic laws leading to a stronger disconnect and weakening of I-O policing which tries to moderate and ends up chafing all parties. For example Bill Black says under Clinton prosecuting fraud dropped because it would hurt innovation, for example a bank might collapse or lose the competition against other corrupt banks elsewhere, then get overshadowed.

Networked zealotry | Critical Thinking Applied

Networked zealotry | Critical Thinking Applied

The dramatic drop in communication costs, and explosion in ability to connect, that the information technology revolution represents means that the like-minded can associate together far more easily. This can be liberating and reassuring. It can also lead to intensification of beliefs as people reinforce each other and divergent information is excluded or discredited. An ironic effect of massively increased access to information is to make the crippled epistemology (pdf) which is so much a part of zealotry and fanaticism easier to maintain.
Established groupthinkThe established information institutions have (more than) done their bit to create the basis for these patterns. While critical thinking is allegedly an ideal of post-Enlightenment education (particularly universities), what educations systems have generally actually been teaching and practising (particularly universities) has been groupthink. (Scott Sumner, for example, regularly bewails the current groupthink among macroeconomists–all the more remarkable since it fails to conform to previous accepted analysis.)

This is V-Bi and Y-Ro thinking where teams develop normalized ideas and deviant information is discredited as potential deception or wrong Iv-B and Oy-R. 

Saturday, February 23, 2013



We normally carry our sense of identity around with us and are thus well aware of how we are relating to other people. There are ways, however of losing ourselves, including:
  • Becoming a part of a large group, such as a mob or army.
  • Becoming engrossed in an interesting task, such as a hobby.
  • Meditation and other contemplative activities.
Deindividuation into a group results in a loss of individual identity and a gaining of the social identity of the group. When two groups argue (and crowd problems are often between groups), it is like two people arguing. The three most important factors for deindividuation in a group of people are:
  • Anonymity, so I can not be found out.
  • Diffused responsibility, so I am not responsible for my actions.
  • Group size, as a larger group increases the above two factors. 

In many cases it is advantageous to join V-Bi and Y-Ro teams, however they lose the ability to deceive as individuals as well as to compete with others.

Dark Social: We Have the Whole History of the Web Wrong - Alexis C. Madrigal - The Atlantic

Dark Social: We Have the Whole History of the Web Wrong - Alexis C. Madrigal - The Atlantic

And then one day, we had a meeting with the real-time web analytics firm, Chartbeat. Like many media nerds, I love Chartbeat. It lets you know exactly what's happening with your stories, most especially where your readers are coming from. Recently, they made an accounting change that they showed to us. They took visitors who showed up without referrer data and split them into two categories. The first was people who were going to a homepage ( or a subject landing page ( The second were people going to any other page, that is to say, all of our articles. These people, they figured, were following some sort of link because no one actually types "" They started counting these people as what they call direct social. 

The second I saw this measure, my heart actually leapt (yes, I am that much of a data nerd). This was it! They'd found a way to quantify dark social, even if they'd given it a lamer name! 

On the first day I saw it, this is how big of an impact dark social was having on The Atlantic. 

Just look at that graph. On the one hand, you have all the social networks that you know. They're about 43.5 percent of our social traffic. On the other, you have this previously unmeasured darknet that's delivering 56.5 percent of people to individual stories. This is not a niche phenomenon! It's more than 2.5x Facebook's impact on the site.

Thw web is strongly Iv-B and Oy-R because of its root and branch structure, following these connections then is difficult. The more social V-Bi and Y-Ro social media is small like plants sprouting fast with few leaves yet. Often this chaotic part of the web is deceptive, people using false names and misrepresenting themselves.

This is then a V-Bi and Iv-B disconnect because of the weak policing on the web.

How your last name will doom your descendants centuries from now

How your last name will doom your descendants centuries from now

It’s well known that there’s a huge correlation between the earnings and social status of a person and the earnings and social status of that person’s parents. That correlation varies a lot by country. It’s very high in the United States, where there’s widespread economic inequality, and in Britain, which has a formal class system. But it’s much lower in Scandinavia.
Now, two researchers argue that the link is bigger than we thought — even in Scandinavia. Gregory Clark of UC Davis, the author of “A Farewell to Alms,” and Neil Cummins at CUNY have done two recent studies that track social mobility in Britain and Sweden using families with rare last names.* They figured that people with a rare surname are likely to all be related, which allowed Clark and Cummins to track the well-being of those people throughout the years.
They found that in both countries inheritance explains 49 percent to 64 percent of where you ended up in terms of social status. This is true whether you look at wealth, life expectancy or college attendance. In 2011, descendants of poor Britons from 1800 lived  2.3 fewer years, on average, than descendants of rich Britons from 1800.

Families tend to form a tree shape, a couple might see their ancestors as B roots of a tree so their wealth like a tree depends chaotically on what those people accumulated in assets and good genes. There is also a randomizing effect where genes come together and improve the family overall like a Ro herd mixes genes. In the future they can see their descendants like branches of a tree where the most successful might be competitors against other branches in that family like rivals, or against other families. A more Iv-B economy is more innovative so this root and branch effect is accentuated, people with abilities from these genes might do much better or collapse. A more V-Bi economy is stagnant so these abnormaly superior abilities are of little use in a random situation, families are then more likely to marry people with random abilities and characteristics diluting their "blue blood" distinctive gene heritage. This also happens in the Roy animal kingdom, a Ro herd might have dominant makes that mix their genes in the whole herd, to be replaced by a succession fo dominant males doing the same over time. Oy predators might select mates more on their ability and competitive advantages leading to more speciation and special characteristics.

The billionaires next door | The Great Debate

The billionaires next door | The Great Debate

Pittsburgh was one of the smelters of America’s Gilded Age. As the industrial revolution took hold there, Andrew Carnegie was struck by the contrast between “the palace of the millionaire and the cottage of the laborer.” Human beings had never before lived in such strikingly different material circumstances, he believed, and the result was “rigid castes” living in “mutual ignorance” and “mutual distrust” of one another.

Iv-B and Oy-R result in more inequality because they are chaotic without a normal equilibrium in wealth. They boom and bust, like poker the better players quickly get most of the money and the wealth distribution becomes more like an exponential than a normal curve.

  Gates said. “I haven’t found any burgers at any price that are better than McDonald’s.” He admitted there were some great perks, like flying on a private jet, but said that after a “few million or something, it’s all about how you’re going to give it back.”

V people are like the leaves of trees, they distribute a lot of wealth as charity to Roy people in the food chain. Even Y people can be like this as philanthropists or looking after their people, they act like the apex of the food chain that controls evolution according to what they destroy and what they allow to thrive.

A recent family of academic studies suggests that there may in fact be a coarsening effect of privilege. Paul Piff, a psychologist at UC Berkeley, and four other researchers devised seven different experiments to test the impact of affluence on how we treat others. “Is society’s nobility in fact its most noble actors?” the researchers ask. Their answer is a resounding no: “Relative to lower-class individuals, individuals from upper-class backgrounds behaved more unethically. ” Their explanation for the behavior of these ignoble nobles: “We reason that increased resources and independence from others cause people to prioritize self-interest over others’ welfare and perceive greed as positive and beneficial, which in turn gives rise to increased unethical behavior.”

More successful talented people can be Iv and cut throat competitive, however as they rise higher they can join the V club and support each other against these lower down Iv competitors.

Dana Radcliffe: The Cost of Deceptive Politics

Dana Radcliffe: The Cost of Deceptive Politics

At the heart of our ad-saturated democratic process is a moral paradox. Politicians raise and spend billions of dollars to convince us to trust them with the responsibility of governing us. But (as I argued in an earlier post) the fevered competition for votes virtually compels them to lie to us. Because lying inevitably undermines trust, including citizens' trust in their leaders and in government generally, we have cause to worry about the increasing dishonesty of political campaigns. For leaders distrusted by their constituents cannot hope to unify them behind efforts to tackle the urgent problems afflicting our communities, states, and nation.
As this year's elections proved, when today's consultant-driven campaigns fixate on the likely "effectiveness" of their messages, accuracy is a secondary concern.

Iv agents for right wing politicians can become deceptive with the competition, those that don't produce results for the V backers lose out in a Gresham's Law dynamic. The same occurs on the left B deceptive people in the Bi party hide behind the team strength and also use misinformation. So there is an Iv-B disconnect of competing deceptions to win votes along with a V-Bi open and transparent war of attrition with voter numbers and the amount of money they contribute as teams. 

This is an overtone for the Roy societies, Oy might be like an eminince grise that protects the Y dictator with misinformation, propaganda, and secret police. Ro people protestor with secretive R leaders often using more misinformation to exaggerate the crimes of Y-Oy. In both cases if I-O are weak the colors disconnect and war wasting resources. 

Give And Take: How The Rule Of Reciprocation Binds Us : Shots - Health News : NPR

The FP Top 100 Global Thinkers | Foreign Policy

Robert Cialdini is an emeritus psychologist at Arizona State University who studies how our behavior is affected by social rules that we're only vaguely aware of but which have incredible power over what we do. What happened to Kunz, he explains, is the direct result of one of the rules that most interest him: the rule of reciprocation. The rule, he says, is drilled into us as children.
"We are obligated to give back to others, the form of behavior that they have first given to us," he says. "Essentially thou shall not take without giving in return."
And so if someone passes you in the hall and says hello, you feel compelled to return their greeting. When you don't, you notice it, it makes you uncomfortable, out of balance. That's the rule of reciprocation.

This happens more in Biv parts of society, V-Bi teams tend to cooperate with each other and help each other in a positive sum game where all benefit. Also a positive sum game sually benefits both parties so in a wealthy GB area people generally benefit from this attitude. In a Roy society this works less well, a free horse might be ridden to death as favors are ussed up and not reciprocated. However people in Y-Ro teams migth look after each other because they know rival teams will exploit and weaknesses in their cooperation. Iv-B and Oy-R people only compete and so using up favors without reciprocating can be a competitive advantage.

The FP Top 100 Global Thinkers | Foreign Policy

The FP Top 100 Global Thinkers | Foreign Policy

They can act like a global V team cooperating and sharing ideas instead of hiding information from each other as Iv. In poorer areas they can appear more like a global Y mafia or predatory capitalists dividing the lion's share of resources between themselves.


The ‘words hurt’ model of polarization

The ‘words hurt’ model of polarization

They argue that simply identifying with a political party, as most Americans do, is enough to generate unfavorable attitudes toward the other side, or the “out-party.” (This idea should feel pretty familiar to Red Sox and Yankees fans.) And a variety of survey evidence shows that in recent decades Democratic identifiers have come to view Republicans increasingly negatively, and vice versa.

As GB resources become more scarce they become more like predator and prey, one gets resources only at the expense of another in a negative sum game. 

  To be sure, some of this “affective” polarization stems from the growing ideological differences between the parties. In particular, the authors found that policy preferences on social welfare issues were significantly correlated with how favorably Americans’ rated the out-party in comparison to their own party. This is consistent with Pew Research Centerdata showing that the largest “values” gap between Republicans and Democrats emerges on issues related to the social safety net.

In a Biv society the debate is moderate Iv individualism against the Bi safety net, if the country becomes poorer it is more like Oy thieves or predatos like hyenas against the Ro gang acting like socialists with public G property or Ro herd animals.

John Stuart Mill on political correctness

 John Stuart Mill on political correctness

Our merely social intolerance kills no one, roots out no opinions, but induces men to disguise them, or to abstain from any active effort for their diffusion. 

In a Biv society they become Iv-B, a hidden prejudice that chaotically changes many situation.

With us, heretical opinions do not perceptibly gain, or even lose, ground in each decade or generation; they never blaze out far and wide, but continue to smoulder in the narrow circles of thinking and studious persons among whom they originate, without ever lighting up the general affairs of mankind with either a true or a deceptive light. 

Sometimes they can flare up but then hit a ceiling as they become too visible as V-Bi, I-O police can also become involved. usually it oscillates between this ceiling and a floor of minimum prejudice. 

And thus is kept up a state of things very satisfactory to some minds, because, without the unpleasant process of fining or imprisoning anybody, it maintains all prevailing opinions outwardly undisturbed, while it does not absolutely interdict the exercise of reason by dissentients afflicted with the malady of thought. 

 Many Iv-B and Oy-R parts of sosciety are hidden like this, like B being driven underground as roots and Iv branches hidden behind V leaves. Because Iv-B and oy-R are chaotic they can represent logical thinking of cause and effect to give these opinions, often though they run up against the random thinking of V-Bi and Y-Ro. For example someone decides a race is inferior, then they are confronted with random genetic mixes of that race clearly superior to them. The two attitudes then are that a race might grow in roots and branches indicated one is superior, the other is that random mixes of genes can create superior people in any race.

A convenient plan for having peace in the intellectual world, and keeping all things going on therein very much as they do already. But the price paid for this sort of intellectual pacification, is the sacrifice of the entire moral courage of the human mind. A state of things in which a large portion of the most active and inquiring intellects find it advisable to keep the general principles and grounds of their convictions within their own breasts, and attempt, in what they address to the public, to fit as much as they can of their own conclusions to premises which they have internally renounced, cannot send forth the open, fearless characters, and logical, consistent intellects who once adorned the thinking world. 

In the I-O marketplace of ideas there comes a balance between V-Bi political correctness often championed by Bi and Iv prejudice, often seen in the media as left versus right and policed by hate crime and libel laws.

The sort of men who can be looked for under it, are either mere conformers to commonplace, or time-servers for truth, whose arguments on all great subjects are meant for their hearers, and are not those which have convinced themselves. Those who avoid this alternative, do so by narrowing their thoughts and interest to things which can be spoken of without venturing within the region of principles, that is, to small practical matters, which would come right of themselves, if but the minds of mankind were strengthened and enlarged, and which will never be made effectually right until then: while that which would strengthen and enlarge men’s minds, free and daring speculation on the highest subjects, is abandoned.
How Napoleon Chagnon Became Our Most Controversial Anthropologist -

A Roy society has tribes or gangs that can war with each other, this is because resources are scarce G like public property. They are then controlled by whoever can do this, for example women might be scarce and so become Roy. Some foods might be Biv and not warred over, there might even be trade between some tribes. This is because it is more profitable to trade in some things that are abundant Biv rather than fight. 

In turning the Yanomami into the world’s most famous “unacculturated” tribe, Chagnon also turned the romantic image of the “noble savage” on its head. Far from living in harmony with one another, the tribe engaged in frequent chest-pounding duels and deadly inter-village raids; violence or threat of violence dominated social life. The Yanomami, he declared, “live in a state of chronic warfare.”
The phrase may be the most contested in the history of anthropology. Colleagues accused him of exaggerating the violence, even of imagining it — a projection of his aggressive personality. As Chagnon’s fame grew — his book became a standard text in college courses — so did the complaints. No detail was too small to be debated, including the transliteration of the tribe’s name. As one commentator wrote: “Those who refer to the group as Yanomamö generally tend to be supporters of Chagnon’s work. Those who prefer Yanomami or Yanomama tend to take a more neutral or anti-Chagnon stance.”