The ancient Greek computational mechanism
We now know a little more:
After a closer examination of the Antikythera Mechanism, a surviving marvel of ancient Greek technology, scientists have found that the device not only predicted solar eclipses but also organized the calendar in the four-year cycles of the Olympiad, forerunner of the modern Olympic Games.
The device also had a likely connection with Archimedes. Here is the full story.
Why blogs should cover some topics randomly
Think of a blog as competing with both Google and Wikipedia, among other aggregators. If you knew you wanted to read about "the minimum wage," you could bypass Tyler and Alex and Google to the best entries (some of which might include us, of course). But with Google and Wikipedia you must choose the topic. A good blog writer can randomize the topic for you, much like a good DJ controls the sequence of the music. Sometimes you might trust us more than you trust other aggregators, but we can’t count on that and arguably the other aggregators improve at a rate faster than we do.
Sentences to fear
Covered bonds issued by "too big to fail" banks are basically equivalent to mortgage backed securities guaranteed by Fannie and Freddie.
Here is much more, though I cannot see that the credit of the United States government is in danger. There is a) the printing press, and b) our location on the left side of the Laffer Curve. The point remains that additional debt for the major banks, while arguably necessary, weakens the off-balance sheet position of our government.
Markets in everything, the riches of Japan once again
So much for fixed costs, this time it’s weird drinks. How about "Bilk": 70 percent beer, 30 percent milk? That’s only the beginning. There’s a cheese drink, desalinated seawater (hey, isn’t that expensive?), placenta drink (made from swine placenta) and eel soda. And if that’s not enough for you, here is last year’s list. As I like to say, if you’re not thinking about Japan every day, you’ve yet to wake up.
Why isn’t Asian music more popular?
Going back to some old requests, Eric H., a loyal and perceptive MR reader and commentator, asks:
Why do the US (a wealthy country) and Africa (a poor continent) put out
more influential modern music than Asia (a populated continent of both
wealthy and poor extremes)?
1. Most African music has scales very similar to those of European music and thus we are arguably considering a unified and indeed accessible style.
2. Many African musics emphasize rhythms and rhythm is arguably the most universal element of music and thus it is relatively easy to export. American music has in this regard a strong African component, for obvious historical reasons.
3. The micro-tonal musics, as we find in India and the Middle East, don’t spread to many countries which do not already have a micro-tonal tradition. Cats wailing, etc., though it is a shame if you haven’t trained your ear by now to like the stuff. It’s some of the world’s finest music.
4. Many Asian musics, such as some of the major styles of China and Japan, emphasize timbre. That makes them a) often too subtle, and b) very hard to translate to disc or to radio. African-derived musics are perfect for radio or for the car.
5. African music is really, really good. And America is really, really good at entertaining people. It’s an unstoppable alliance.
Artistic disintermediation
A small menagerie of new Damien Hirst pickled animals took a bow yesterday, including a new shark, a zebra, a calf with solid gold horns and hoofs valued at up to £12m, and even a unicorn – a white foal fitted with a resin horn, rather than an apparition from a fairytale.
All have been churned out by his small army of assistants this year for an auction at Sotheby’s in September which will sell more than 200 pieces. The auction is predicted to raise £65m, comfortably setting a new world record for the artist, and blazing a trail which other artists will watch with interest, of bypassing the gallery and dealer system and going straight to auction.
Both the Gagosian Gallery, and Jay Jopling’s White Cube, his American and British dealers, have given the auction their blessing, possibly through gritted teeth…
If you are a dealer this is big news and indeed bad news. But why not? Hirst doesn’t need gallery publicity or buyer recruitment. Since galleries tend to sell their best works to loyal repeat buyers ("why?" is a good question), this implies that "seniority" will matter less and less for assembling a good collection. That favors foreign buyers and hedge fund types. Here is the link. Here is Felix Salmon’s very good post on the economics of contemporary art.
The economics of vengeance
Within a given country, people who have been victims of the same kind of crime (here, a burglary) tend to be more vengeful, but not if they have been victims of a different crime, like mugging.
Of course the basic idea comes from Adam Smith. Here is the full story, which features commentary by GMU economists. Here is my previous post on the topic.
“Markets” in everything
Playboy magazine in Braille. (The link is safe for work, by the way.) It is produced by…er…The Library of Congress.
Thanks to Jason Kottke for the pointer.
Are books overwritten?
…having said that, spending a lot of time on the internet, as I have
since 2002, has rubbed my nose in something that hadn’t really bothered
me before then: namely just how overwritten so many books and magazine
articles are. Seymour Hersh? He’s great. You could also cut every one
of his pieces by at least 50% and lose exactly nothing. And I’m not
picking on Hersh. At a guess, I’d say that two-thirds of the magazine
pieces I read could be sliced by nearly a third or more without losing
much. That’s true of a lot of books too.
Here is the full piece, by Kevin Drum. My view is that many readers want overwritten books to tranquillize themselves, just as they enjoy dull, soothing voices on the radio.
Readers, do you agree that most books are overwritten? Please write your opinion of Kevin Drum’s point in the comments and feel free to refer to specific books. My favorite rock star, the extraordinary Hillel, would like to again create a song from your opinions. I will link to the song once it is ready. Hillel assures me that the quality of his song will reflect the quality of your input. Be poetic! Think music! Overwrite, if you wish!
Civil society
Mortgage fraud is terrible, but as crimes go it is a sign of how peaceful so much of the world has become:
A man once convicted of heading up a ruthless Haitian death squad that
is blamed for raping and killing political rivals has been convicted of
carrying out a mortgage fraud scheme in the United States.Emmanuel "Toto" Constant, 51, former leader of the Front for the
Advancement and Progress of Haiti, or FRAPH, was convicted Friday of
arranging millions of dollars in fraudulent financing for three
Brooklyn properties, according to a statement from the New York
attorney general’s office.
Ask any Haitian about FRAPH. Here is the full story. At least the CIA is no longer subsidizing him. Here is a list of his crimes against human rights. It is his second conviction for mortgage fraud.
Who first predicted the mortgage crisis?
The Mortgager and Mortgagee differ the one from the other not more in length of purse, than the Jester and Jestee do in that of memory. But in this the comparison between runs, as the scholiasts call it, upon all four; which, by the bye, is upon one or two legs more than some of the best of Homer’s can pretend to; — namely, That the one raises a sum and the other a laugh at your expense, and think no more about it. Interest, however, still runs on in both cases; — the periodical or accidental payments of it just serving to keep the memory of the affair alive; till, at length, in some evil hour, — pop comes the creditor upon each, and by demanding principal upon the spot, together with full interest to the very day, makes them both feel the full extent of their obligations.
That is Laurence Sterne, from Tristram Shandy, chapter XII.
Summers Vindicated (again)
For the past week or so the newspapers have been trumpeting a new study showing no difference in average math ability between males and females. Few people who have looked at the data thought that there were big differences in average ability but many media reports also said that the study showed no differences in high ability.
The LA Times, for example, wrote:
The study also undermined the assumption — infamously espoused by former Harvard University President Lawrence H. Summers in 2005 — that boys are more likely than girls to be math geniuses.
Scientific American said:
So the team checked out the most gifted children. Again, no difference. From any angle, girls measured up to boys. Still, there’s a lack of women in the highest levels of professional math, engineering and physics. Some have said that’s because of an innate difference in math ability. But the new research shows that that explanation just doesn’t add up.
The Chronicle of Higher Education said:
The research team also studied if there were gender discrepancies at the highest levels of mathematical ability and how well boys and girls resolved complex problems. Again they found no significant differences.
All of these reports and many more like them are false. In fact, consistent with many earlier studies (JSTOR), what this study found was that the ratio of male to female variance in ability was positive and significant, in other words we can expect that there will be more math geniuses and more dullards, among males than among females. I quote from the study (VR is variance ratio):
Greater male variance is indicated by VR > 1.0. All VRs, by state and grade, are >1.0 [range 1.11 to 1.21].
Notice that the greater male variance is observable in the earliest data, grade 2. (In addition, higher male VRS have been noted for over a century). Now the study authors clearly wanted to downplay this finding so they wrote things like “our analyses show greater male variability, although the discrepancy in variances is not large.” Which is true in some sense but the point is that small differences in variance can make for big differences in outcome at the top. The authors acknowledge this with the following:
If a particular specialty required mathematical skills at the 99th percentile, and the gender ratio is 2.0, we would expect 67% men in the occupation and 33% women. Yet today, for example, Ph.D. programs in engineering average only about 15% women.
So even by the authors’ calculations you would expect twice as many men as women in engineering PhD programs due to math-ability differences alone (compare with the media reports above). But what the author’s don’t tell you is that the gender ratio will get larger the higher the percentile. Larry Summers in his infamous talk, was explicit about this point:
…if one is talking about physicists at a top twenty-five research university, one is not talking about people who are two standard deviations above the mean…But it’s talking about people who are three and a half, four standard deviations above the mean in the one in 5,000, one in 10,000 class. Even small differences in the standard deviation will translate into very large differences in the available pool substantially out.
If you do the same type of calculation as the authors but now look at the expected gender ratio at 4 standard deviations from the mean you find a ratio of more than 3:1, i.e. just over 75 men for every 25 women should be expected at say a top-25 math or physics department on the basis of math ability alone (see the extension for details on my calculation). Now does this explain everything that is going on? I doubt it. As Summers also pointed out it takes more than ability to become a professor at Harvard and if there are variance differences in characteristics other than ability (and there are) we can easily get a even larger expected gender ratio.
Does this mean that discrimination is not a problem? Certainly not but we need the media and academia to accurately present the data on ability if we are to understand how large a role other issues may play.
Addendum 1: Andrew Gelman points out that perhaps alone among the media, Keith Winstein at the WSJ reported the story correctly.
Addendum 2: The authors show variance ratios of 1.11 to 1.21, I take a VR of 1.16. If we set the female variance to 1 this implies the standard deviation for female ability is 1 and for male ability 1.077. Using an online calculator for the Normal distribution you can find that given their standard deviation .0102% of males have ability of 4 or greater (4 female sds) but given their sd only .0032% of females can be expected to have the same level of ability, thus a gender ratio of 3.18.
Note that we are assuming that mathematical ability is normally distributed – we know the data fit this distribution around the mean but we don’t know much about what happens at the very top.
Sherlock Holmes on prediction markets
"When you see a man with whiskers of that cut and the ‘Pink ‘un‘ protruding out of his pocket, you can always draw him by a bet," said he. "I daresay that if I had put £100 down in front of him, that man would not have given me such complete information as was drawn from him by the idea that he was doing me on a wager.
That is from Adventure of the Blue Carbuncle and of course the link is added by yours truly. The latest news from the prediction markets, by the way, is that the U.S. basketball team is given about a 75 percent chance of taking home the gold medal.
The cost of mortgage agency bailouts
I’ve read varying estimates of the cost of the mortgage bailout, including a sum of $1 trillion mentioned in The Wall Street Journal. I have no idea what the number will be (and I’m not ruling out zero, or close to zero) but here is how to think about the costs:
1. Reimbursing agency debt holders is a transfer, not an economic cost. No resources are destroyed by the reimbursement.
1b. The previous bad lending involves a cost — in this case too many homes — which already has been incurred. This is not a cost of the bailout per se.
2. If government taxes the citizenry to raise money for the bailout, those taxes involve a deadweight loss. Maybe 20 percent of revenue raised is a decent estimate of this cost.
3. Bailing out debt holders means that future lenders won’t be as careful as they should be. This problem dates from LTCM, or even further back, and it gets worse each time. The result is excess leverage and leverage of the wrong kind, namely to "too big to fail" institutions, which then become even bigger and more leveraged. I haven’t seen a back of the envelope estimate of how much that really costs, much less a careful estimate, but this is a very important magnitude for calculating the net cost.
4. Often in these plans equity holders are (nearly) wiped out. So beware all the talk of moral hazard. The real moral hazard is on the side of future creditors, not the current, possibly-soon-to-be-extinguished equity holders. They really are getting burned.
5. If the government dallies in executing the bailout, borrowing costs for the entire economy will rise. A bailout has to be swift and decisive, assuming you want to do it. Yet a swift and decisive bailout will likely involve errors of detail.
6. Doing a justified bailout this time makes it harder next time to avoid an unjustified bailout. The bailout mentality is contagious in the political arena.
7. The transfer to the debt holders is generally regressive, at least under the likely assumption that the marginal taxpayers are less wealthy than the debt holders. Of course some of the debt holders are foreign governments, which adds another element to the mix.
8. When it comes to the mortgage agencies, there is no real choice but to bail out the debt holders. The alternative is a run on the dollar and collapse of faith in U.S. government securities and the end of the world.
Markets in everything, Japanese edition
The DVD is called Miteiru dake (Just Looking),
and it features various talent/models just staring straight ahead.
That’s right, the models on the DVD do very little other than stare
straight at the camera. According to the website, the idea is to get
young males who aren’t used to socializing with women to become more
accustomed to making eye contact and/or handle the fact that a sentient
being sits across from them and awaits interaction. The DVD hopes to
cure those afflicted with shyness so that they may rejoin society.
Here is more information, with an embedded video at the link. Thanks to Justin Mancinelli for the pointer. Of course the market offers real variety:
The result,
from what one can see on the website, is strangely disconcerting. A
girl will stare back at you for an extended period of time,
expressionless and periodically blinking (the blinks are eerily
profound). Once in a while the model will utter a phrase like "ohayoo"
(good morning) or make a move to say something, but for the most part
there is just an uncomfortable silence. Most of the women on the DVD
are jimusho-based talento (most have blogs on Ameba
and other DVDs of their own to sell), but there are also foreign women,
young girls, and older women thrown in the mix to give the viewer
experience in handling long, uncomfortable silences with those of
different races and ages.